I was on the elliptical machine at my gym which has nice LCD TV’s attached to the machines. Had been watching CNN when a fascinating story about outsourcing town hall came up. Tried to locate the story from the CNN website but it seems to have lost out to other momentous events of the day. Nevertheless, USA today has the story which is about a month old. More details appear at the Atlanta Journal.
New cities like Sandy Springs,Atlanta are outsourcing all town functions to private company CH2MHill save fire,police and judiciary. Why not fire,police and judiciary also? – after all companies have security contractors handling security all the time? I guess it is a question of "core competence" of the town hall. Their core competence is governance and that is why people elect the Town officials in the first place. The Town Hall managements do not see garbage removal,pothole filling, parks and gardens as "core competence" areas. For example just parks and recreation means getting lawn mowers,managing their maintenance and spare parts. Luckily Atlanta does not have to deal with snow which would mean managing salt and sand inventory as well!
When the organization is a public body and outsourcing is to a company I guess the phenomenon is called "privatization" and opens up a whole new set of issues. The initial rationale is that the cost/efficiency is better from a Private Company whose "core competence" is doing certain things like say "filling potholes". If the company does this for several towns then the economies of running a crew and materials probably work out. .. Why only new towns are trying this ? Apparently due to legacy labor union problems according to the news report…and privatization has its own problems as as Atlanta realized with its water supply- the contractor did not collect payments and gave poor service till they had to terminate the contract with United Water Services. Once again highlights the need of staying on top inter-organizational relationships…