RISK ASSOCIATED WITH FACILITIESMANAGEMENT OUTSOURCING AND ITS IMPACT ON SERVICE PERFORMANCE

Abstract

In Sri Lanka, Facilities Management (FM) outsourcing has shown steady growth in recent years. Although FM outsourcing has become popular, organizations do not aware about what risks are involved with outsourcing and its impact on service performance. Therefore, the purpose of this study is to develop the strategic framework to analyse risks associated with FM outsourcing and their impact on service performance. Firstly, a literature review was done to identify FM outsourcing risks and its impact on service performance. Further, management strategies were reviewed to overcome FM outsourcing risk with a view to improving performance. A quantitative research approach based on questionnaire was followed to achieve research aim. The initial literature survey findings and preliminary survey finding were included in the questionnaire. Subsequently, questionnaire survey was conducted among the professional experts in both FM service provider companies and client organisations. The results were analysed using descriptive and inferential statistical methods. Accordingly, 31 factors were identified among the analysed 32 FM outsourcing risk factors. The relationship between FM outsourcing risks with service performance attributes were identified by using correlation analysis and FM service provider related risks were rated at the high side of correlation. The factor analysis was also carried out and six management strategies were identified as the most efficient strategies. Finally, a framework to enhance the FM outsourcing practice was developed based on the research findings, in order to suggest appropriate solution to overcome FM outsourcing risk. Hence developed framework can be used to effectively manage FM outsourcing practice for FM practitioners.