The document discusses outsourcing of civil engineering maintenance work. It defines outsourcing and describes how comprehensive outsourcing of all maintenance services under one contract is being implemented for a residential campus. Only 2 bidders were technically qualified and performance has been found to be better with improved quality of service, coordination among disciplines and customer satisfaction. Issues related to workers and supervisors still need resolution.
2. DEFINITION OF
OUTSOURCING
OUTSOURCING IS AN ARRANGEMENT IN WHICH
ONE COMPANY PROVIDES SERVICES FOR
ANOTHER COMPANY THAT COULD ALSO BE OR
USUALLY HAVE BEEN PROVIDED IN-HOUSE.
THE CONTRACTING OR SUBCONTRACTING OF
NON CORE ACTIVITIES TO FREE UP CASH,
PERSONNEL, TIME, AND FACILITIES FOR
ACTIVITIES IN WHICH A COMPANY HOLDS
COMPETITIVE ADVANTAGE .
OUTSOURCING IS ANY TASK, OPERATION, JOB
OR PROCESS THAT COULD BE PERFORMED BY
EMPLOYEES WITHIN AN ORGANIZATION, BUT IS
INSTEAD CONTRACTED TO A THIRD PARTY FOR
A SIGNIFICANT PERIOD OF TIME.
3. TO PURCHASE (GOODS) OR SUBCONTRA
CT
(SERVICES) FROM AN OUTSIDE SUPPLIER
OR SOURCE.
TO CONTRACT OUT JOBS, SERVICES, ET
C.
OUTSOURCING IS THE ACT OF
TRANSFERRING SOME OF AN
ORGANIZATION'S RECURRING INTERNAL
ACTIVITIES AND DECISION RIGHTS TO
OUTSIDE PROVIDERS.
4. OUTSOURCING
IN THE PRESENT CONTEXT, OUTSOURCING
IS CONTRACTING ALL THE SERVICES TO BE
CARRIED OUT RELATED TO MAINTENANCE
SERVICES IN A RESIDENTIAL CAMPUS.
BASICALLY IT IS COMPRHENSIVE
MAINTENANCE TO BE CARRIED OUT
INCLUDING REGISTERING, MONITORING,
SUPERVISION AND ATTENDING THE
COMPLAINTS.
OUTSOURCING IN THE PRESENT CASE IS
DIFFERENT IN TERMS THAT IT STILL
REMAINS THE CORE ACTIVITY OF THE
ORGANISATION.
5. IT TAKES TIME TO IMPLEMENT AN
OUTSOURCING INITIATIVE AND LONGER
TO DO IT RIGHT
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6. OBJECTIVE OF
OUTSOURCING
RECRUITMENT
TRAINING
LEGAL OUTSOURCING
IT OUTSOURCING
WEB DESIGNING
LOGISTICS
MANUFACTURING
TECHNICAL SUPPORT
BUT IN THE PRESENT CASE, OUTSOURCING
IS RESORTED TO CIVIL ENGINEERING
MAINTENANCE.
7. WHY OUTSOURCING?
LACK OF EXPERTISE
COST EFFECTIVENESS
CONCENTRATING CRUCIAL BUSINESS
IN THE PRESENT CASE, OUTSOURCING IS
RESORTED FDUE TO NON AVAILABILITY
OF INHOUSE STAFF, CUSTOMER
SATISFACTION AND BETTER CO-
ORDINATION AMONG DIFFERENT
DISCIPLINES.
8. ADVANTAGES
SWIFTNESS AND EXPERTISE
CONCENTRATING CORE PROCESS
RISK SHARING
REDUCED OPERATIONAL AND
RECRUITMENT COST
EFFICIENCY
IN THE PRESENT CASE, OUTSOURCING IS
BEING RESORTED FOR SWIFTNESS,
REDUCED OPERATIONAL COST AND
EFFICIENCY.
9. DISADVANTAGES
RISK OF EXPOSING DATA/INFORMATION
SUB STANDARD QUALITY
LACK OF FOCUS ON CUSTOMER
LOSS OF TALENT
DEPENDENCY
LACK OF INDEPTH KNOWLEDGE
LACK OF SKILL DEVELOPMENT WITHIN
ORGANISATION
LEGAL DISPUTES
11. ACTIVITIES OF CENTRAL
PUBLIC WORKS DEPARTMENT
CONSTRUCTION
MAINTENANCE (CIVIL+ ELECTRICAL &
MECHANICAL +HORTICULTURE
SERVICES+ HOUSEKEEPING)
DAY TO DAY
ARMO
SPECIAL REPAIR
ADDITION AND
ALTERATION
12. MAINTENANCE
DAY TO DAY
MAINTENANCE
DEPARTMENTAL
WORKERS
(INSOURCING)
COSOURCING
CONTRACTING
OUTSOURCING
ARMO, SPECIAL
REPAIRS AND A/A
WORKS
13. WORKMAN
"WORKMAN" MEANS ANY PERSON
EMPLOYED IN OR IN CONNECTION WITH
THE WORK OF ANY ESTABLISHMENT TO
DO ANY SKILLED, SEMISKILLED OR UN-
SKILLED MANUAL, SUPERVISORY,
TECHNICAL OR CLERICAL WORK FOR
HIRE OR REWARD, WHETHER THE TERMS
OF EMPLOYMENT BE EXPRESS OR
IMPLIED
14. THE SUPREME COURT OF INDIA IN THE CASE
OF STANDARD VACUUM REFINERY COMPANY
VS. THEIR WORKMEN OBSERVED THAT
CONTRACT LABOUR SHOULD NOT BE
EMPLOYED WHERE: —
(A) THE WORK IS PERENNIAL AND MUST GO
ON FROM DAY TO DAY;
(B) THE WORK IS INCIDENTAL TO AND
NECESSARY FOR THE WORK OF THE
FACTORY;
(C) THE WORK IS SUFFICIENT TO EMPLOY
CONSIDERABLE NUMBER OF WHOLE TIME
WORKMEN; AND
(D) THE WORK IS BEING DONE IN MOST
CONCERNS THROUGH REGULAR WORKMEN.
15. ISSUES OF OUTSOURCING
MAINTENANCE
TO OUTSOURCE OR NOT TO OUTSOURCE – STRATEGIC
DECISION
HOW MUCH TO OUTSOURCE ?
WHERE TO OUTSOURCE ?
DRAWING SPECIFICATIONS OF THE WORK/REQUIREMENTS ?
DRAWING ADMINISTRATIVE, PAYMENT AND COMPENSATION
STRUCTURE ?
DRAWING CONDITIONS NOT VIOLATING LAWS AND ACTS ?
DRAWING SPECIFICATIONS AND REQUIREMENTS OF
EQUIPMENTS.
CONDITIONS OF TRANSITION AND HANDING OVER OF
ASSETS.
FRAMING CONTRACT DOCUMENT INCLUDING THE PERIOD
OF OUTSOURCING CONTRACT.
DRAWING ELIGIBILTY CRITERIA FOR SELECTION OF
APPROPRIATE AGENCY.
ISSUES RELATED TO UNIONS AND ASSOCIATIONS.
17. DETAILS OF SERVICES
Civil engineering repairs of plumbing, carpentry,
masonry work etc.
Electrical engineering repairs like repair of wiring,
switches etc.
Horticulture operations
Caretaking operations like sweeping in external
areas and common areas
Lift operations
Water supply and pump operations
Fire fighting and fire protection equipment
maintenance
Watch and ward of common services and vacant
quarters
Operations of service centers which include
receiving the complaints, their disposal and
18. SALIENT FEATURES OF THE
CONTRACT
The contract includes the day to day
maintenance and repair, annual repair,
special repair and up-gradation of
Hyderabad estate campus having flats of
type IV-32, type IV special- 70, type V-160
Nos., single suit with kitchen-13 and double
suit with kitchen-76 Nos. with 14 quarters
for departmental maintenance staff.
19.
20. VENDOR SELECTION
CRITERIA
Satisfactorily completed three similar
works each of value not less than 50% of
estimated cost (present case Rs. 8.35
crore) or two similar works each of value
not less than 60% of estimated cost or one
similar work of value not less than 80% of
estimated cost in last 7 years and one
work of any nature (either part of given
above or separate one) costing not less
than 50% of the estimated cost
21. VENDOR SELECTION
CRITERIA• Should have had average annual financial
turnover of 100% of the estimated cost of
work for one year maintenance on
construction / maintenance works during
the last three financial years ending 31st
March 2014.
• Should not have incurred any loss in more
than two years during the last five years
ending 31st March 2014.
• Should have a solvency of 40%of the
estimated cost for one year from any
22. Bidding Capacity = A*N*2-B
Where A = Maximum value of works
executed in any one year during the last
5 years,
N = Number of years prescribed for
completion of work for which bids has
been invited (2 in the present case study)
and
B = Value of existing commitments and
ongoing works to be completed during
the period of completion of work for
which bids have been invited. Bidding
23. MARKS ALLOCATED
(a) Financial strength: Maximum 20 Marks (16 for
financial turn over and 4 for solvency certificate),
(b) Experience in similar work during last seven
years: Maximum 20 Marks,
(c) Performance on works (time over run):
Maximum 20 Marks, (d) Performance on works
(Quality): Maximum 15 Marks,
(e) Personnel and Establishment: Maximum 10
Marks,
(f) Plant and equipment: Maximum 15 Marks.
Total: 100 Marks
To become eligible for short listing, the bidder
must secure at least fifty percent marks in each
criterion and sixty percent marks in aggregate.
24. ELIGIBILITY CRITERIA
IF THE BIDDER HIMSELF IS NOT
REGISTERED IN ANY CLASS AND
CATEGORY IN CPWD FOR THE
FOLLOWING WORKS, HE HAS TO
ASSOCIATE APPROVED AND ELIGIBLE
CONTRACTOR OF CPWD IN THE
CATEGORIES LISTED BELOW FOR THE
EXECUTION OF RESPECTIVE WORKS.
CIVIL
INTERNAL AND EXTERNAL ELECTRICAL
INSTALLATION
HORTICULTURE
25. ELIGIBILITY CRITERIA
FURTHER HE SHALL ASSOCIATE
AGENCIES ENLISTED/ANNUALLY PRE-
QUALIFIED IN CPWD IN APPROPRIATE
CATEGORY/CLASS FOR THE FOLLOWING
WORKS:
1. D.G. SETS.
2. FIRE ALARM SYSTEM
3. FIRE FIGHTING SYSTEM
COMPREHENSIVE MAINTENANCE OF
LIFT SHALL BE GOT MAINTAINED FROM
RESPECTIVE LIFT MANUFACTURERS
ONLY.
26. PROVISIONS OF MANDATORY
EQUIPMENTS
CIVIL/ELECTRICAL DEFINED AND INCLUDED IN THE TENDER
DOCUMENTS
Hopper mixer
Floor Polishing machines
Steel scaffolding
Welding machine
Tile cutters
Edge moulding machine
Aluminium ladder
Wheel ladder with platform
Megger
Earth resistance tester
Green barber (lawn mower)
Double bucket trolley
Trolley mounted Water jet
Walk behind sweeping machine (mechanical)
Vacuum cleaners
27. 1. Graduate
Engineer
Civil/Elec. Principal Technical
Representative
1 5
2.
Graduate
Engineer or
Diploma
Engineer
Civil Technical
Representative
1 Nil for
Graduate
Engineer
and 5 Years
for Diploma
Engineer
3. Graduate
Engineer or
Diploma
Engineer
Electrical Technical
Representative
1 Nil for
Graduate
Engineer
and 5 Years
for Diploma
Engineer
4. Hort.
28. Sl. No. Description Recovery for
absence
Per Day
1. Service Engineer Rs. 1000.00 Per visit
2. Enquiry Clerk/Supervisor/Computer Operator Rs. 900.00 Per Day / Person
3. E & M operator Rs. 800.00 Per Day / Person
4. Supervisor Rs. 800.00 Per Day / Person
5. Wireman /Operator /Mechanic Rs. 800.00 Per shift / person
6. Skilled labour (Mason / Carpenter / Plumber etc.) Rs. 800.00 Per Day / Person
7. Operator for Petrol Driven sweeping Machine (skilled) Rs. 800.00 Per Day / Person
8. Operator for water Jet machine (skilled) Rs. 800.00 Per Day / Person
9. Operator for Vacuum cleaner (skilled) Rs. 800.00 Per Day / Person
10. Unskilled labour Rs. 700.00 Per Day / Person
11. Khalasi Rs. 700.00 Per shift / person
RECOVERIES
29. OTHER CRITERIA
SPECIFIED
SAFETY CRITERION
MATERIAL SPECIFICATIONS
TIMINGS FOR WORKERS AND SERVICE
CENTRES
EMERGENCY REQUIREMENTS
TESTING CRITERION OF MATERIALS
DEPLOYMENT OF MINIMUM WORKERS
LABOUR WELFARE MEASURES
COMPLAINTS CLASSIFICATION
NO DELAY
MINOR
MAJOR
30. BIDS RECEIVED
ONLY 2 Nos. WERE TECHNICALLY
QUALIFIED
COMPREHENSIVE OUTSOURCING
IMPLEMENTD
PERFORMANCE FOUND TO BE BETTER
31. ISSUES NEED TO BE
RESOLVED
WORKERS ISSUES
SUPERVISORS ISSUES
CO-ORDINATION ISSUES
ENGINEERS ISSUES
32. MAINTENANCE OUTSOURCING
MODELS
Providing services of workers departmentally
or partially on contracts i.e. in-house work or
partial outsourcing (COSOURCING).
Individual contracts for each work i.e.
individual work outsourcing (CONTRACT).
Individual contracts for all the works of one
specialized field such as civil, electrical and
horticulture i.e. specialized fields outsourcing
(SPECIALISED FIELD OUTSOURCING).
Comprehensive maintenance in which all the
works are carried out under one contract i.e.
comprehensive outsourcing (OUTSOURCING)
33.
34.
35. ADVANTAGES OF
OUTSOURCING
1. INCREASED CUSTOMER
SATISFACTION
2. BETTER CO-ORDINATION AMONG
VARIOUS DISCIPLINES
3. IMPROVE QUALITY OF SERVICE
4. BETTER MANAGEMENT
5. COST COMPARABLE
36. CONCLUSIONS
AVAILABILITY OF LIMITED AGENCIES IN THIS
FIELD
LIMITED EXPERIENCE OF COMPREHENSIVE
MAINTENANCE IN CIVIL ENGINEERING
WORKS
INSOURCING VERY COSTLY
COST IS COMPARABLE
CO-SOURCING NOT VERY SUCCESSFUL
COMPREHENSIVE OUTSOURCING PROVIDES
BETTER CUSTOMER SATISFACTION AND
EFFICIENT SERVICES