Developing a Contract Provision Framework for Outsourcing of

DEVELOPING A CONTRACT PROVISION FRAMEWORK FOR OUTSOURCING OF FACILITIES MANAGEMENT

Prof. Dr. Sr. Abdul Hakim Bin Mohammed (Leader)

Assoc. Prof Sr. Maizan Bin Baba

Dr. Izran Sarazzin Bin Muhammad

Assoc. Prof. Dr. Buang Bin Alias

Centre For Real Estate Studies,

Faculty of Geoinformation and Real Estate

Universiti Teknologi Malaysia

81310 Skudai, Johor, Malaysia.

ABSTRACT

Previous researches show that outsourcing success depends on social as well as contractual relationships. However, none of the research sought the perception of the users, although it is users who ultimately judge the performance of the contractor. The initial stage of this study indicates that the users of outsourced facilities management services in public hospital are not satisfied with the performance of the contractor. Their complaints were pointed at the contract provisions that are not meeting their requirements and thwarting them from successfully performing their diagnostics and healthcare duties on the patients. Therefore, it is essential to identify an outsourcing contract provision framework that is user-focussed as perceived by the users themselves. Hence, this research was set out to identify the outsourcing contract provision framework for public hospital facilities management services. One hundred ninety two (192) contract provision framework items were identified through literature review and practices of the private and public hospitals in Malaysia, and subsequently benchmarked to international practices of the United Kingdom. A questionnaire survey was conducted among users of the outsourced facilities management services in three selected major public hospitals in Malaysia. The result from frequency and importance index analysis indicates that the users perceived all 192 contract provisions to be very important for the success of outsourcing. This result was then verified by a group of professional through a workshop session. The workshop result that is based on the practicality, fairness and efficiency criteria shows that only 165 contract provisions were accepted for inclusion into user-focussed outsourcing contract provisions for public hospital facilities management services. The result of this research has contributed to outsourced facilities management services in meeting the requirements of users.