The study sample consists of the Department of Water Affairs and Forestry and the Imperial Group. Develop a sustainable business model for outsourcing services within the Department of Water Affairs and Forestry.
Background of the Study
The private sector has proven that it can undertake a range of tasks more efficiently and cost-effectively than government departments. As a result, a number of other mechanisms have been developed to involve the private sector in government enterprises.
Theories on outsourcing services
What they often lack, however, is access to the types of knowledge, technologies, capital, economies of scale and other resources that the larger outsourcing providers enjoy. The small manager outsourcing providers become so bogged down in running the business that they can no longer concentrate on building the business (Corbett, 2002).
Previous studies on outsourcing services
The study also found that some outsourcing service firms generally thrive in a weak economy, but outsourcing revenue increased by 20%. A study by Spalding (1998) in the outsourcing of transport found that one of the last areas in the supply chain where business focuses on reducing costs is transport. The study found that almost 60 percent of all Fortune 500 companies in the United States of America spend their logistics costs on transportation.
The study found that outsourcing is one of the primary reasons displaced workers are quickly re-employed. Their research studies on displaced workers found that outsourcing tends to employ poorer and disadvantaged people who work longer hours for less pay. Swanger, Chewning and Eugene's (2001) study on outsourcing found that outsourcing is an effective tool for ensuring transparency, especially when services such as auditing are outsourced.
Conclusion-
In their study of loan officers, independence was perceived to be impaired when both internal and external audit services were operated without separate staff. It has been stated that the value of outsourcing is its benefit to the company in terms of cost reduction, efficiency, flexibility and improved performance. This study examines a specific case with enormous financial implications between an outsourcer and a service provider.
The case review therefore concerns the outsourcing strategy and its financial viability to the Ministry of Water and Forestry. It is therefore crucial that the documents discussed here are not only relevant, but also contain all the details of the outsourcing strategy, as well as data on the financial viability of the outsourcing company for the Ministry of Water and Forestry.
Research method
The case study method chosen in this case allows the researcher to focus on one case and analyze it in order to provide valuable information that can influence policy decisions. The target organizations, that is, the Department of Water and Forestry and the Imperial agreements have been carefully studied and all sources of data between the two. The study focuses on the contracting aspect between the two organizations and excludes irrelevant information that has no benefit to this study.
Sample·
The contractor shall ensure clarity on the management plans and information systems for managing the contract, as required in the output specifications. The approval or rejection of a vehicle by the representative does not in any way release the contractor from his obligations under the contract. The Contractor shall submit monthly itemized invoices to each nominated NUD Transport Officer, certified as correct by the Project Manager.
Provisions for metering for each part of the services are initiated in the price schedule. This also applies mutandis in favor of the contractor with regard to the correctness of a submitted invoice. The contractor shall comply with all laws and regulations of the Republic of South Africa during the term of the contract.
Whether or not the Guarantee is accepted is at the sole discretion of the State. In addition, and without limiting the foregoing, Contractor shall deliver such documentation to the State immediately upon expiration or termination of the Contract. The contractor will inform all its employees of the identity, powers and duties of the representative or the person authorized by him.
According to the model, the Department of Water Affairs and Forestry must outsource because transport is a peripheral service, but the management of the contract improves in terms of the recommendations in the previous chapter.
Data collection
Data analysis••
Conclusion
The Department of Water and Forestry and the Imperial Group have an outsourcing agreement. The financial feasibility of this outsourcing strategy is discussed in the next chapter. This chapter presents the data and discusses the findings of the study on the effectiveness of outsourcing services as a tool for improving service delivery in the KwaZulu-Natal Ministry of Water Affairs and Forestry. The decision to outsource services is generally based on the cost-effectiveness and financial feasibility of such a service.
It is therefore important that once the services have been outsourced, a thorough evaluation of the cost and viability of the outsourced service is carried out. The study of this nature requires document analysis to be selectively synthesized to distinguish separate researchable information and information not relevant to this study. All relevant documents were available and most of the information required for the purpose of this study was obtained and analyzed.
Document analysis·
The representative and/or the Transport Officer determines the value of the services monthly, on the agreed date. Under the terms of the contract, the service provider may be obliged to operate other passenger services, provided that the operation of such services does not in any way hinder or impede its ability to provide the services provided for in the terms. of the contract. That the type and condition of all vehicles to be provided by the Contractor correspond to the requirements of the performance specifications, if so ordered by the Representative, the Contractor shall remove from the Services all unsuitable and/or unroadworthy vehicles.
That the representative and any person authorized by him/her shall at all reasonable times have access to all vehicles, workshops and warehouses of the contractor for the purpose of quality monitoring and general inspection and the contractor shall afford every facility and give every assistance regarding such access. The contractor, at the request of the representative, must submit evidence of the validity of all licenses, permits and any other requirements arising from the contractor. Such evidence shall be provided no later than seven (7) days from the date of receipt of the request for return by the representative.
Analysis of data
The study showed that outsourcing has major negative financial implications for the Department of Water Affairs and Forestry. The conclusions reached in this study show that the problem highlighted is the financial impact that outsourcing services can have for the Department of Water Affairs and Forestry. That the peripheral services in the department of water affairs and forestry are outsourced and the department focuses on core duties.
To find out whether outsourcing is essential for the Ministry of Water Affairs and Forestry. The government has opted for outsourcing as a way to save on expenditure where necessary within the Ministry of Water Affairs and Forestry. The findings of this study show that outsourcing has enormous negative financial consequences for the Ministry of Water Affairs and Forestry.
Necessity for outsourcing in the Department of Water Affairs and
Viable business model for outsourcing services within the Department of
Conclusion
Conclusion.-.•
Literature shows that among the most outsourced services such as technology, auditing, transportation, etc.; transportation is a service that companies around the world consider outsourcing more often than any other service. The reasons for this tendency to outsource transport services include: the sample and data sources to be analyzed were the agreement between the two institutions; this is the Department of Water and Forestry and Imperial car hire. An outsourcing service to the public bodies is a tool that is used to relieve the non-core functions, such as transport, for a period of time.
The outsourcing model developed in the previous shows that the profile of task or process aligned with the first (leftmost) column will require the outsourcing of the task to a supplier. Water and Forestry outsourcing choice, i.e. transport is a peripheral service and is in line with the outsourcing model that has been developed. The previous chapter through financial analysis further shows that although the outsourcing of transport seems the right option in terms of the model, it has major financial implications for the Department of Water Affairs and Forestry.
Recommendations
Establish an objective, measurable scorecard in advance and use it as a cornerstone of the management process. This venture has been estimated to save the ministry and government approximately R1 billion in operating costs. This system is currently operational, but already the management of the Department of Water and Forestry has realized that such a venture with huge financial consequences should.
Therefore, this study will determine whether outsourcing is essential for the Department, how outsourcing can improve the Department's cost structure and what the viable business model for outsourcing services for the Department will be. When outsourcing, the Department must make use of the outsourcing model developed in this study and put in place measures such as those listed under recommendations to manage the contract and also to avoid any form of avoidable contract failure. The outsourcing model above developed in this study shows that the profile of task or process aligned with the first (leftmost) column will require outsourcing the task to a supplier.
Statement of problem·
Research method
All data collected in a study such as this one that uses a case study method is relevant to the case being studied. The two organizations were chosen because the outsourcing strategy could serve as a yardstick to measure similar deals in the future. The specific area of focus is the car rental agreement between the two organizations.
Outsourcing services to government agencies is a tool used to relieve non-core functions, such as transportation, for a certain period of time. According to the theory, it is more cost-effective to outsource peripheral tasks because the alternative, namely maintaining the same services within the organization, is expensive.
