This paper examines the debate over replacing non-instructional school employees with professional service providers as a cost-reduction strategy. It reviews the potential financial savings that outsourcing food, janitorial, and other non-mission-critical functions can offer educational institutions, particularly given economies of scale available to large service providers. It also addresses the quality-control concerns that arise when institutions lose direct oversight of contracted workers. The paper argues that successful outsourcing depends heavily on clearly defined objectives, measurable outcomes, rigorous contract design, and proactive stakeholder buy-in. Drawing on literature from higher education administration, the paper concludes that outsourcing is viable when best practices are followed.
Replacing non-instructional personnel in schools with professional service providers is a controversial topic for several reasons. Parents and other stakeholders are naturally more reluctant to trust the welfare of their children to for-profit professional service providers than to local school employees. Whereas schools have direct control over their own employees, outsourced workers are more loyal to their employers than to the schools they serve. There are also concerns about the quality of services and how that quality might be adversely affected by cost-cutting measures. On the other hand, outsourcing non-essential functions could potentially represent significant cost savings for educational institutions.
On balance, outsourcing non-instructional functions is a viable approach to cost reduction, provided that institutions follow best practices in the selection of service providers and in the accurate calculation of measurable projected outcomes. However, beyond the actual implementation of an effective service-selection process, there are also internal political considerations that must be addressed.
The cost of education in America has been continually increasing for decades, particularly at the college level, so much so that hundreds of colleges have cut departments and services and reduced options available to students as cost-cutting measures (Bushman & Dean, 2005). Outsourcing non-instructional or non-mission-critical functions can often reduce costs and improve services. However, where it is not properly researched and implemented, it can actually cost more than retaining institutional employees in those positions (Maciejewski, 2007). Whether the transition to professional services increases or decreases the quality of services is an important concern, as is the identification of processes to ensure the former and prevent the latter.
Generally, professional service providers can furnish the same types of food service and janitorial functions for lower costs than the comparable cost of directly employing the staff necessary to furnish the same services. This cost advantage arises mainly by virtue of economy of scale and the efficiency of processes associated with large operations dedicated to specific kinds of services (Bushman & Dean, 2005; Weaver Smith & Smith, 2012). Large operations can maintain services at sufficiently low overhead costs that they can typically offer highly competitive prices even after accounting for a healthy profit margin (Bushman & Dean, 2005; Weaver Smith & Smith, 2012).
"Loss of direct control risks lower service quality"
"Best practices and stakeholder buy-in drive success"
"Conditional recommendation for outsourcing with safeguards"
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