Reader Feedback – 2007-07-15

Beware of costly consulting contracts

Back in the days when outsourcing in general was an alien concept, the novelty that anyone actually had a business for outsourced production maintenance was enough to differentiate anyone in the business.

Indeed, times have changed. In fact the concept of outsourced factory maintenance is catching on quickly. Analysts have pegged the market for outsourced factory services at well over $100 billion and growing. And with its current rapid adoption rate, many of the largest consultancy companies have begun offering it as part of their pallet of services.

But look before you leap into a costly consulting contract.

Maintenance is, and will always be, a hands-on craft, the likes of which does not seem to match up with pin-striped suits. Not that we have anything against fashion or consultants, but consulting companies can only show you a way — they can’t take you there. They all stop short of implementing a real plan.

That’s why when seriously considering outsourcing production maintenance, it’s important to look for a company that can provide more than a high level concept of what should be done. Look for a company that can execute the plan — and one with a list of successes and metrics to help you sleep better at night.

Outsourcing can provide outstanding gains in productivity and increased output. It can also be a disaster if not implemented correctly. There are many issues that must be considered — from studying the current machine data to spare parts inventory to managing the human issues — all of these must be improved quickly with the least amount of unplanned disruption.

Don’t be afraid to ask the companies you are considering how many of their contracts have been terminated in the first 12 months. This is important to know because it reflects on their internal culture’s ability to manage change in your environment.

Simply stated, companies with weak change management skills or companies that merely replace or substitute people will fail more often than not, because they are unable to affect change in the host company’s culture.

On the other hand, an outsourcer that has a strong culture based on principles of Six Sigma and continuous improvement can complement — and even thrive — within your organization. That’s because Six Sigma and continuous improvement are disciplines for dealing with change — and in today’s volatile manufacturing economy, change is the rule — not the exception.

So choose your partners carefully, read what editors and other experts in the field have written. And above all, schedule time to visit sites where you can see the company at work.

Don Johnson
Vice President, Marketing
Advanced Technology Services. Inc.

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