Properties and Services

Background

The Properties and Services Department (P&S) holds the biggest departmental budget at UCT (R108m in 1999), employed 253 staff at the start of the AIMS Project, and spans an eclectic range of services. The first stage of the AIMS investigation was to compile a detailed dictionary of the services offered to the UCT community by P&S. As there are more than 70 distinct support processes carried out in P&S, it was simply not practical, nor appropriate, to investigate all of these in the same level of detail. In each functional area the intent was to identify the processes and compile them into the process dictionary, to group them where appropriate and possible, and thereafter to classify them in terms of their perceived efficiency and their strategic importance. At the same time an initial view was established as to whether the existing location of the service was ideal, or whether the service could potentially be outsourced, or insourced (given to existing employees to run as small business) or moved to another location (e.g. some faculties being responsible for maintenance of their own equipment).

The classification procedure is illustrated in Figs. 6A and 6B below.

Fig. 6A

Fig. 6B

This analysis revealed that a large proportion of services could potentially be relocated or outsourced. A presentation was made to the AIMS Steering Structure on 16 February 2000 and approval was given to go ahead with a process to determine whether a compelling financial and/or non-financial case existed to indeed outsource or insource the particular service and to commence consultation with all staff that might be affected by the outcome of such a proposal.

The seven services or service areas within P&S that were designated for further investigation were:

• Traffic Management
• Classroom Facilities Unit (CFU)
• Campus Protection Services (CPS)
• Facilities Maintenance Management
• Postal Services
• Commercial Accommodation and Letting (CAL)
• Insurance Office

The P&S management team compiled detailed Requests for Proposals (RFPs) to determine the level of interest and the financial viability of potentially outsourcing or insourcing each of the services listed above. The Business Modelling workstream devised financial and non-financial criteria to evaluate the various responses to the RFPs. These criteria are outlined in the two tables below.

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The RFP and Evaluation Process

The overall process and timing for the issue of the RFPs and for the submission and evaluation of proposals was as follows:

• 24-25 March, 2000 - advertisements via the Cape Argus, UCT electronic noticeboard, placement on physical noticeboards, and via Sourcelink of the availability of the RFPs. The RFPs were then picked up from the UCT Purchasing Department by any interested party.
• 10-14 April, 2000- briefing sessions and visits to sites within UCT for potential respondents to the RFPs.
• 28 April, 2000 - closing date for submission of proposals in response to the RFPs.
• 31 May, 2000 - extended closing date for UCT staff to submit proposals in response to the RFPs.
• 8-11 May, 2000 - P&S management team screens proposals for technical competence.
• 23-26 May, 2000 - P&S management team evaluates proposals in respect of non-financial criteria.
• 23-26 May, 2000 - AIMS Business Modelling workstream finalises evaluation of proposals in respect of financial criteria.
• 30 May - 14 June, 2000 - meetings of the Evaluation Committee.
• 22 June, 2000 - presentation of findings and recommendations to the AIMS Steering Structure.

The Evaluation Committee comprised Prof Geoff Everingham (Chair - Dept of Accounting), Mr A J Cilliers (Dept of Accounting), Mr Henry Fairweather (Director, P&S), A/Prof Derek Japha (Dept of Architecture), Dr Duma Malaza (Director of Planning), Ms Lesley Shackleton (Director, Executive Projects and International Academic Programmes Office). In addition, three observers were invited to attend, namely Ms Avril Beukes (UCT Staff Association), Mr Leonard Malukazi (NEHAWU - National Education Health and Allied Workers Union), and Mr Ted Stuart (nominated by P&S staff). Mr Tom Papenfus (Shell South Africa) attended as a technical advisor.

Specifications of the various RFPs were distributed to members prior to the meetings of the Evaluation Committee. In view of the complexity of the exercise, Properties & Services in conjunction with AIMS team members had processed the various proposals received together with internal financial data from UCT to provide a summary of the proposals to the Evaluation Committee.

The Evaluation Committee met on three occasions during the week of 12 June, for about 10 hours in all. In general the approach taken, to use the words of the Shell advisor, was to determine whether the committee endorsed the findings of Gemini and P&S rather than attempting to rework what had already been done. In view of the time constraints it was not possible for all members of the Evaluation Committee to be present at all meetings, but a minimum of 4 were present at all times. The NEHAWU observer did not attend (being on leave). NEHAWU were invited to send a substitute, but did not do so. The two other observers attended throughout.

A number of proposals had been excluded by virtue of scope (in that they failed to meet the specifications of the RFP), or competence (in that the respondent clearly lacked the resources to meet the service level requirements envisaged by the RFP). Further, some respondents failed to complete the proposals adequately (for example, costs were not dealt with); in essence, these proposals represented expressions of interest, rather than being formal proposals. After review of the reasons furnished in each case, the Evaluation Committee concurred with the exclusion of these respondents from further consideration.

Several proposals had been received from staff. P&S had screened these, with some excluded on the basis of scope. All exclusions had been explained by Henry Fairweather to the staff concerned.

Proposals which passed the scope and competence hurdle had been evaluated as follows:

• Financial aspects - a Gemini Consultant with members of the AIMS Team
• Non-financial aspects - Properties & Services.

A parallel assessment of UCT costs, and service levels was undertaken by AIMS and P&S respectively.

A number of respondents submitted proposals in more than one of the seven categories. In two instances, the proposals were clearly linked to an intent to provide overall Facilities Management (replacing many of the functions currently carried out by P&S).

For each proposal, Komani Mfuni (Gemini consultant on the Business Modelling workstream of AIMS), made a short presentation as to the financial aspects, followed by a presentation by the relevant P&S manager. Following questioning and discussion, Mr Mfuni and the P&S managers left the meeting, and the Evaluation Committee proceeded to decide upon its recommendation. The committee gained the distinct impression that P&S had sought to be as objective as possible, despite the potential threat implicit in the outsourcing evaluation.

Basis of Assessment

P&S had used a basis of scoring the non-financial considerations (to a maximum of 20 in each category) in an effort to assist comparability. This was not used as an absolute yardstick, but did give considerable assistance in providing a measure of UCT performance and the probable performance of the leading contenders). In assessing the financial factors, allowance had to be made for the cost of interface management in the event of outsourcing. This was added to the UCT costs, based on an estimate of relevant management time.

A number of issues arose relating to assessment:

• The meaning of a "compelling case" for outsourcing needed to be considered, as the phrase has been much used and clearly implied that in borderline cases, outsourcing would not be undertaken. However, this seemed somewhat in conflict with what the Evaluation Committee understood to be part of the underlying mission of UCT, namely to focus on core activities of teaching and research. The committee did not attempt to resolve this philosophically, but took the approach of focusing on the need for improved levels of service delivery in support of the core operation, taking into account the risks involved.
• The degree of influence of financial factors. The committee took the approach that this should not be the dominant factor, as the emphasis should be on service delivery first. In some cases, however, there might be a case for outsourcing on the grounds of improved service levels, but the costs involved would rule this out.
• Whether UCT should be assessed "as is", or on the basis of what might be (in the sense that improved service delivery might result in the face of the prospect of outsourcing, or could be achieved by better management). The Evaluation Committee took the view that UCT's service delivery levels were best measured by what is happening currently.

Evaluation Committee Recommendations

The report on the evaluation process and the recommendations of the Evaluation Committee were presented to the AIMS Steering Structure on 22 June 2000. The presentation material made available here (as a 360kb pdf file) has been modified only in respect of the Vendor names which have been changed to "Vendor 1", "Vendor 2", etc.

Fig. 6C

Fig. 6D

The full recommendations made by the evaluation Committee are shown in Figs. 6C and 6D. In summary their findings and recommendations were:

• That no compelling case existed to outsource Traffic Management, Classroom Facilities Unit, Facilities Maintenance Management, Postal Services and Commercial Accomodation and Letting.
• That a compelling case existed to outsource Campus Protection Services and the Insurance Office.

It was subsequently recognised during further investigation of the Insurance Office that the role of an external service provider had not been correctly defined and that this needed additional investigation. The process followed for the outsourcing of Campus Protection Services is discussed further in some of the following sections.

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Observers' Report

The two observers (Ms A Beukes and Mr T Stuart) who attended all the meetings of the Evaluation Committee made the following comments in their report:

"The Executive staff members of Properties and Services presented their findings and recommendations to the committee based on the criteria used by Properties and Services. Overheads were shown at the meeting on the criteria used and how the scoring was arrived at.

We the observers felt that the presentation by Properties and Services was well done. The information that was shared and the preparation of the presentations must have taken them an enormous amount of time and effort.

During the presentation the committee members asked many valid and appropriate questions.

After each area section was presented, the P&S staff left the boardroom and the committee discussed and debated over what was presented to them. At no time during these meetings were the findings presented by Properties and Services and AIMS automatically accepted by the committee. The committee members were committed in arriving at the best solutions and ensured that the recommendations put forward by them would be highly considered.

The process in which we were involved as observers was done openly and in-depth.

We also believe that the selection of the committee members was well done and the diversity and strengths brought by each member contributed greatly in assisting with the recommendations."

The Consultation Process

The overall consultation process followed the framework established by the HR/ER workstream and adhered to the sequence of milestones defined in that framework.

The consultation process with staff in P&S commenced on 25 February, 2000, when Henry Fairweather (then newly appointed as Director of P&S) announced to the Department the the University was considering outsourcing many of the functions provided by P&S. Other redesign options included improved service provision from within P&S, or from alternative locations within UCT, together with the opportunity for existing UCT staff members to establish their own service companies. The Staff Association and NEHAWU were invited to attend the briefing session together with P&S staff and both bodies had been informed of the issues in a prior meeting.

P&S staff, the Staff Association and NEHAWU were invited to make representations on the proposed rationale (ER milestone 3), and to develop their own alternatives for redesign, motivated by business cases. Several representations were received, considered and responded to.

Following the meeting of the AIMS Steering Structure on 22 June 2000 consultation in respect of a proposal to outsource CPS (ER milestone 4) began with affected staff (those in CPS and traffic officers in payclass 5) during the period 4-6 July, 2000. Meetings were also held with the Staff Association and with NEHAWU. The representations received were carefully considered and led to significant changes in the proposal and recommendations that were taken to Council on 6 September 2000 and on 1 November 2000. In particular, the AIMS Core Committee and the University Executive had initially intended to recommend to Council that CPS be outsourced as a "going concern", but following representations this was modified so that the final recommendation to Council was that CPS be outsourced in a phased process in which no UCT staff would suffer involuntary retrenchment.

A total of more than 160 formal consultative meetings took place with the staff bodies (the Staff Association and NEHAWU), with groups of P&S staff, and with individual staff members.

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Final Recommendations for CPS Outsourcing

The document presented to Council on 6 September 2000 and on 1 November 2000 summarised the reasons for recommending the outsourcing of CPS as follows:

• Outsourcing of security has become the norm in business and industry. An article in Business Day 0f 1 August 2000 indicated that 94% of South African companies let outside experts take care of non-core activities such as security,
• The leading vendor's costs are significantly lower than those of UCT.
• The leading vendor's non-financial performance, i.e. service levels, is considered to be higher than that currently provided by in-house UCT security.
  • Vendor's size and resources allow them to provide additional trained personnel at very short notice.
  • By virtue of their widespread operations the vendore are exposed to the latest trends and techniques in the field of security. This is applicable not only to security activities within South Africa, but also internationally.
  • The leading vendors have advanced training techniques for their staff and are continually exposing staff to the latest advances in security services.
• UCT will be placing its security in the hands of professionals whose core business is security.
• Management found that this recommendation is consistent with the University's rationale for possible changes in that:
  • It will allow improved focus on the University's core activities of teaching, learning and research, as the University will now have a specialist organisation looking after the security function. This will reduce senior management's involvement in managing this non-core activity.
  • Service levels should improve as the University will now have improved manning levels and greater flexibility. The vendors have the capacity to manage contingencies related to staff absences and unplanned events.
  • The proposal complies with the requirement for increased cost effectiveness while adequately protecting the University's assets as there is a potential savings over a period of time whilst improving the current levels of security at UCT.
  • The University Strategic Planning Framework supports the principle of investigating outsourcing of support functions to minimise the support structures and maximise output.
  • In essence, the recommendation to outsource will provide the University with improved service levels while achieving significant savings in the longer term.
• In essence, the recommendation to outsource will provide the University with improved service levels while achieving significant savings in the longer term.

Six options were presented in the Council document, these being:

Option 1: Remain as is

This implies that CPS retains its present form, staffing levels and method of operation. The services currently outsourced (Medical and Hiddingh Campuses) will remain outsourced and from time to time this will again go out to tender.

Option 2: Implement Business Process Reengineering in CPS

In this case a Business Process Reengineering exercise will be carried out on the current operation.

Option 3: Disestablish and Outsource

This will mean that the CPS staff (with the exception of the Investigation Unit) are retrenched and the security services are provided by the preferred vendor. The vendor will be required to interview all UCT staff and must offer employment to all UCT staff who meet their requirements. However, this offer of employment will be at the vendor's remuneration levels and under their conditions of employment. The University will incur once-off retrenchment costs of approximately R2.5m.

Option 4: Outsource as a going concern

Under this option all the current CPS staff, will be offered voluntary retrenchment or early retirement. The remaining staff will be transferred to the preferred vendor. These staff will retain their current conditions of service and remuneration. Where the vendor is unable to provide a particular benefit, such as educational assistance, UCT will be liable for this. All accumulated benefits such as accumulated leave etc. will be transferred to the vendor.

Option 5: Co-source with a management contract

Under this option UCT staff remain in the employ of UCT (with all their benefits and remuneration unchanged) but the management of the complete security operation is handed over to the vendor. UCT therefore retains responsibility for its staff but they are managed by the vendor. Again staff will be offered the option of voluntary retrenchment or voluntary early retirement. Services currently outsourced will be supplied by the preferred vendor.

Option 6: Phased approach

With this option the security services which are currently outsourced will remain outsourced, but to the preferred vendor. The current CPS staff will be offered incentivised early retirement and voluntary retrenchment packages and, where appropriate vacancies exist, CPS staff will be redeployed within the University. Early retirement and voluntary retrenchment packages should also be offered to staff in the UCT Traffic Department to allow additional redeployment of CPS staff. No vacancies within CPS will be filled, but as the services provided by CPS are reduced the vendor will provide these services. This proposal still has as its ultimate objective the provision of security by a specialist external vendor. However, the transition will be a phased one. The new vendor will be required to interview CPS staff, who want to take a package from UCT and join the vendor, and employ them if suitable. CPS staff who wish to remain employed by UCT will be able to do so. The vendor will become involved in training and accreditation of CPS staff and will have direct input into crime prevention strategies.

Management noted that they had originally favoured option 4 (to outsource as a going concern), however there were very strong reservations expressed by potentially affected staff and by the staff bodies about the going concern proposal. These were mostly around the financial strength of a vendor and its ability to meet the monthly payments to staff, the security of their pension funds if transferred to a vendor's pension fund and the length of time for which the vendor can sustain paying CPS staff at such a large differential to the vendor's own staff. Staff also felt that the vendor would not be able to use them on any contract other than UCT and that their future would be in jeopardy if the University did not renew the vendor's contract after the initial period.

Given this feedback, and the fact that there was no immediate financial benefit, management reviewed the situation and then developed option 6 (phased outsourcing). This option addressed all the concerns raised by staff and meets most of the requirements of the University. Option 6 is also a far more socially responsible option.

The benefits and concerns that were noted for option 6 are shown in the table below.

It was recommended that Council approve the outsourcing of the security function at the University by means of option 6 and that management is authorised to enter into such a contract with the preferred vendor.

In addition, management requested approval to offer CPS staff the option of voluntary retrenchment and/or incentivised early retirement. They also requested approval for the same offer to be made to staff in the UCT Traffic Department in order to create opportunities for the redeployment of CPS staff.

Council considered the proposal only briefly at its meeting on 6 September 2000 as the Vice-Chancellor had requested permission to withdraw the proposal to afford more time for discussion with the staff bodies and with the Student Parliament.

At the Council meeting on 1 November 2000, it was reported that a management task team, convened by Professor Gevers, had consulted widely and had signed an agreement with the UCT Employees Union in which they withdrew their objection to an enhanced proposal for the phased outsourcing of CPS in which no existing staff member suffer either forced retrenchment or involuntary transfer to an external vendor.

The management team had also met with student leaders (SRC members and members of the Student Parliament Management Committee) after which process a letter was sent to Council by the SRC President also withdrawing objections to the outsourcing of CPS, conditional on a number of factors being explicitly taken up in the implementation phase.

Professor Gevers reported that a number of meetings had been held with NEHAWU, that a draft agreement identical to that signed with the UCT Employees Union had been offered to this Union, and that discussions were continuing on matters of detail.

Council approved:

• the outsourcing of the security function at the University by means of option 6 (phased outsourcing), and authorised management to enter into such a contract with the preferred vendor; and
• that management offer CPS staff the option of voluntary retrenchment and/or incentivised early retirement. Approval was further given for the same offer to be made to staff in the UCT Traffic Department in order to create opportunities for the redeployment of CPS staff and for all CPS staff who elect to remain in CPS to be placed on the redeployment list. This process should be undertaken in line with the agreement signed with the UCT Employees Union.
  

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Additional Recommendations

The Evaluation Committee also recommended that those functions where it had been decided that there was no case for outsourcing should be considered candidates for Business Process Reengineering. Several functions within the facilities maintenance area were subsequently scheduled for BPR and several other functions within P&S were investigated to assess whether BPR was appropriate. Links to the descriptions of these various BPR workstreams or to the reports of the investigations are provided below:

• Project Realisation (BPR Wave 2)
• Reactive Maintenance (BPR Wave 2)
• Planned Maintenance (BPR Wave 3)
• P&S Service Centre (BPR Wave 3)
• Educare (investigation)
• Classroom Facilities Unit (investigation)
• Postal Services (investigation)

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Implementation

Prior to Council's decision, Properties & Services Department had met with the potential service providers and again ensured that they understood fully the requirements of the University and had asked them to submit revised proposals for the provision of this service. A vendor evaluation committee was established which consisted of Properties & Services as well as some key users and representatives from staff organisations. The potential service providers made detailed presentations to this committee and on the basis of this it was agreed that the University would appoint Gray Security Services as the service provider for security on our campuses.

Gray Security Services were informed of this and regular planning meetings were held with them to plan the transition with them. On the 4th December 2000 Gray Security took over the security services on the Hiddingh and Medical Campus. During November a workshop was arranged which was attended by members of the Academics Association, Student Housing, Staff Association, SRC, CPS delegates, Gray Security, Properties & Services staff as well as several key users. At this workshop the parties shared expectations and planned the provision of security services on the campus. This workshop was very beneficial in ensuring that the key players met and understood each other prior to Gray arriving on site.

In terms of the outsourcing proposal the current CPS staff were offered the option of voluntary retrenchment or incentivised early retirement. Several staff made use of this benefit and left the employ of the University during December 2000 and January 2001. Initially we had 65 in-house CPS staff (excluding 3 investigation unit staff). This reduced to 27 at the end of January 2001. With this reduction in CPS staff Gray Security took over the Upper Campus duties as well from the end of January 2001.

At the same time our Human Resources department was busy with a redeployment exercise for remaining CPS staff and throughout the period to the end of June staff members were redeployed into other positions within the University structure. This resulted in substantial reduction of CPS staff numbers and at the end of June 2001 we had 9 CPS Officers and 2 Managers.

The staff who remained have undergone a Security Officers Board (SOB) training course, which has been provided by Gray and this was completed during June 2001. As a result of this all of these staff now have SOB qualifications which are recognised throughout the security industry.

At present the remaining CPS staff are being used to provide security at special events such as exams, conferences etc. and when not involved in these functions they work closely with the crime prevention officer to enhance crime awareness on our campus. Two of these staff are also involved on a full time basis engraving all the UCT assets on the campus. This is especially valuable for computer equipment and ensures that these valuable items are marked in a permanent way, which should reduce the instances of theft.

One of the other initiatives of the AIMS process was the implementation of Service Level Agreements (SLAs) throughout the organisation. Within Properties & Services it was agreed that we would use the security services as the pilot project for SLA's. In order to design the SLA input was gathered from users and from the current CPS/Gray staff. Having completing this process we are now negotiating a Service Level Agreement which dictates the service levels which the security provider will deliver to the University community. There are already several key performance indicators (KPIs) being measured, which are reported on a monthly basis and discussed between users and the security services.

During our negotiations with various interest groups prior to outsourcing CPS there was a common request that they be involved on an ongoing basis with the service provider. This was implemented at the joint workshop, which was held in November 2000 when many of these interest groups were invited to be present. On an ongoing basis the Gray Operations Manager meets on a regular basis with the SRC member with the security portfolio to discuss performance, crime awareness and other matters of common interest.

The Operations Manager also meets regularly with other users on campus as well as with the managers off all the other outsource functions i.e. Supercare, Metro, Eco Garden Services. In addition to this regular meetings are held with Student Housing Wardens and Supervisors to ensure a high level of awareness at our residences.

In general our users are commenting favourably on the new service provider and a common theme which comes through is the higher level of visibility and approachability of Gray Security staff. In order to further improve our service levels a suggestion box system has been initiated. Suggestion boxes are installed throughout the campus and are emptied bi-weekly and these responses are incorporated into the KPI reporting system.

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Team

Champions:	Alex Hurter (to 31 January 2000) Yvonne Boswarva (to May 2000) Henry Fairweather (from 25 February 2000)
Team Members:	Mannie Abrahams Trevor Adams Chris Briers Shaheed Daniels Duke Metcalf Mohamed Omar John Tunstall
Consultant:	Nicola Coombe

 

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Properties & Services Evaluation Report

AIMS work in the Properties & Services area was evaluated by members of the UCT community during August and September 2001. Areas specifically under review at this time were the Outsourcing Investigation in P&S, business process reengineering workstreams on Reactive Maintenance and Project Realisation, and investigations in the Classroom Facilities Unit, Postal Services and Educare. (However, some reference was also made to work carried out as part of the more recent Planned Maintenance and Service Centre workstreams, to be evaluated during 2002.) The Properties & Services Evaluation Report may be accessed here, or via the Project Evaluation page, which describes the AIMS Evaluation process that has been followed since project end.

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Links to Additional Material

• File of printable Figures on this page (pdf 94kb)
• Presentation of Evaluation Committee Report to AIMS Steering Structure (pdf 355kb)

To navigate from this page to additional pages on the AIMS website please make use of the buttons in the navigation sidebar near the top of this page.

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Last updated: 2001-10-04