Who cleans your coffee cup?
If you work in a large corporate office, chances are there is some person who doesn’t work for your company but who comes in before you do and cleans up the kitchen, stacks away all the dirty coffee cups that got dumped on the kitchen bench overnight and cleaned up the bits of exploding cheese in the microwave.
You might know their name. You may even stop to talk to them. They may even become well enough known to be invited to the birthday morning tea celebrations.
But they really are not your problem, and the kitchens are nice and clean which you really like. You don’t have to care why they are ill or sick (someone else will be sent along after all), and they do not share in your company’s bonus schemes or your newly introduced family violence leave policies.
Outsourcing the cleaning did away with the endless office emails reminding you that you wouldn’t leave your own kitchen that way. And you will never have to step in and stack the dishwasher yourself when someone is sick or on holiday.
Winners all round, right? Outsourcing the cleaning is legally and economically rational.
But is it?
In an examination of the consequences to schools in Australia following the outsourcing of cleaners [1], (a huge trend in economic rationalism that gained traction in the 1980s), a whole range of consequences emerged:
There was a reduction in direct contact between the school and its cleaners as to the health and safety issues at schools.
Increased paperwork and bureaucracy, the cleaners (often independent contractor’s) dealing with a barrage of independent communication channels from the organisation they were engaged through and the schools who had to manage tender processes and administer these new contracts (and problems under them).
Additional management to supervise the cleaners.
Teachers and parents picking up the tasks not explicitly covered by the cleaning contract or not done because the cheap price that won the job led to short cuts.
Insecurity, with minimum pay slashed to zero the cleaners no longer had the stable employment needed to qualify for mortgages.
Loss of trusted adults in the school yard outside of the teaching hierarchy.
Loss of consequences and remorse for the kid making the mess – they don’t know the name of that cleaner after all.
Another area the subject of extensive examination is in the arena of hospital privatisation, especially following the extensive adoption of the public private partnership (PPP) model in this industry. In most cases the private sector is responsible for providing many parts of a hospital’s essential services, like cleaning, asset management and catering[2] in exchange for an agreed fee.
Championed as cost effective and efficient, what emerged in practice included:
Loss of morale.
o Imagine being responsible for looking after patients but having no direct control over a fundamental thing, like food quality, which keep your patients healthy.
o Being in the radiology department and fearful that your service is the next to be outsourced.
Increased management, administrative and legal costs because no one fully considered what it would take to actually manage the PPP contract and relationship.
Loss of pride. Staff no longer working for the hospital directly become contract employees with little vested interest in the hospital’s outcomes. Combined with the pay squeezes, loss of job certainty and staff reductions, we get a lack of care, trust, and quality.
Ward support staff picking up the grey between where the outsourced works starts and stops, adding to staff tension and frustration.
In many cases, hospital privatisations were back sourced, the services retuning to the control of the hospital.
So, before you reach for your clean coffee cup as you plan to save your company $$ in the next round of outsourcing:
Have you thought about how people really behave in the business structure you are crafting?
What costs of the model have you underestimated or not taken into account?
What strategies do you really need to put in place to make the outsourcing work?
What are your organisation’s values and is the model aligned with those values. Or are you creating a divide between the haves and have nots?
Do you know the name of the person who cleans your coffee cup and what price you really pay for not knowing their name?
[1] Frances Flanagan, ‘What’s the school cleaner’s name? How kids, not just cleaners, are paying the price of outsourcing’ The Conversation, April 26, 2019
[2] Risky Business, ‘The pitfalls and Missteps of Hospital Privatisation, the McKell Institute, November 2014