1. Outsourcing: Opportunity and Risk Randy Soifer Grant Thornton LLP National Business Consulting Service Line Leader (780) 401-8240 / rsoifer@GrantThornton.ca

2. CAUBO Pre-Conference Workshop June 12, 2004 Agenda What is outsourcing? What are the opportunities? Why should you consider outsourcing? What are the potential pitfalls? What are the elements of successful outsourcing?

3. CAUBO Pre-Conference Workshop June 12, 2004 What is outsourcing? Contracting with a vendor to provide a service rather than providing it yourself Widespread in the corporate sector Becoming more common in the higher education / not-for-profit sector

4. CAUBO Pre-Conference Workshop June 12, 2004 What are the opportunities for outsourcing? You can outsource practically anything!

5. CAUBO Pre-Conference Workshop June 12, 2004 Traditional Bookstore Endowment Management Food Services Housekeeping Legal Services Payroll Pension Administration Security Telecommunications Vending Services

6. CAUBO Pre-Conference Workshop June 12, 2004 New Benefits Administration Conference Administration Duplicating Services Health Services Human Resources Information Systems Residence Halls Training & Development Web Site Development Maintenance

7. CAUBO Pre-Conference Workshop June 12, 2004 Why should you consider outsourcing? Most important reason: Focus more directly on core functions such as education and research, reducing time and attention devoted to support activities. Anything outside of your mission statement.

8. CAUBO Pre-Conference Workshop June 12, 2004 Possible reasons to outsource Higher quality service Expertise / experience More cost effective or efficient (more up to date and sophisticated technologies, for instance) More qualified personnel (with career track) May not have been able to successfully manage function Operating expense may be less Limited or no capital investment Less attention is required Shifts some accountability

9. CAUBO Pre-Conference Workshop June 12, 2004 What are the potential pitfalls to outsourcing? Less quality Less institutional control Higher financial costs Ethical / social costs

10. CAUBO Pre-Conference Workshop June 12, 2004 What are the elements of successful outsourcing? Clear communication Clear accountability Clear objectives and methods of evaluation Staff of the provider of services treated fairly Demonstrated commitment to customer service and sensitivity

11. CAUBO Pre-Conference Workshop June 12, 2004 Other factors to consider Institution must still provide oversight of outsourced services – it cannot abdicate responsibility for quality and cost Cost reduction isn’t a sufficient reason Institutional expertise and memory might disappear

12. CAUBO Pre-Conference Workshop June 12, 2004 Other factors to consider Staff of the service provider have a primary allegiance to that provider, not to the institution The “corporate” culture of the service provider could clash with the institution’s culture

13. CAUBO Pre-Conference Workshop June 12, 2004 Independent advice and information Developing outsourcing strategy and criteria Assessing candidates for outsourcing Identifying and evaluating vendors

14. Thank you! Randy Soifer (780) 401-8240 rsoifer@GrantThornton.ca