OUTSOURCING IN CIVIL ENGINEERING MAINTENANCE WORK

DR K M Soni, Chief Engineer, WZ-I, Central Public Works Department, Mumbai

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.

TO PURCHASE (GOODS) OR SUBCONTRACT (SERVICES) FROM AN OUTSIDE SUPPLIER OR SOURCE.

TO CONTRACT OUT JOBS, SERVICES, ETC. OUTSOURCING IS THE ACT OF

TRANSFERRING SOME OF AN ORGANIZATION'S RECURRING INTERNAL ACTIVITIES AND DECISION RIGHTS TO OUTSIDE PROVIDERS.

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.

IT TAKES TIME TO IMPLEMENT AN OUTSOURCING INITIATIVE AND LONGER TO DO IT RIGHT

(www.123rf.com)

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.

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.

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.

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

INSOURCING CO-SOURCING CONTRACT COMPREHENSIVE OUTSOURCING

ACTIVITIES OF CENTRAL PUBLIC WORKS DEPARTMENT

CONSTRUCTION MAINTENANCE (CIVIL+ ELECTRICAL

& MECHANICAL +HORTICULTURE SERVICES+ HOUSEKEEPING) DAY TO DAY ARMO SPECIAL REPAIR ADDITION AND ALTERATION

MAINTENANCE DAY TO DAY

MAINTENANCE DEPARTMENTAL

WORKERS (INSOURCING) COSOURCING CONTRACTING OUTSOURCING

ARMO, SPECIAL REPAIRS AND A/A WORKS ON CONTRACT

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

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.

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.

OUTSOURCING PROCESS/PLANNING INITIATIVES

PRESENT CONTRACT INCLUDES;

DAY TO DAY MAINTENANCE

ARMO SPECIAL REPAIR WORKS OPERATION OF E&M

SERVICES HOUSEKEEPING MANAGING SERVICE

CENTRE

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 maintaining the records through website www.cpwdsewa.gov.in.

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.

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

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 scheduled Bank.

Bidding Capacity = A*N*2-BWhere 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 capacity of the contractor is required to be more than the estimated cost.

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.

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

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.

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

1. Graduate Engineer

Civil/Elec. Principal Technical Representative

1 5

2.Graduate

Engineer orDiploma 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.

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

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

BIDS RECEIVED ONLY 2 Nos. WERE TECHNICALLY

QUALIFIED COMPREHENSIVE OUTSOURCING

IMPLEMENTD PERFORMANCE FOUND TO BE

BETTER

ISSUES NEED TO BE RESOLVED WORKERS ISSUES SUPERVISORS ISSUES CO-ORDINATION ISSUES ENGINEERS ISSUES

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)

ADVANTAGES OF OUTSOURCING

1. INCREASED CUSTOMER SATISFACTION

2. BETTER CO-ORDINATION AMONG VARIOUS DISCIPLINES

3. IMPROVE QUALITY OF SERVICE4. BETTER MANAGEMENT5. COST COMPARABLE

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