Interserve (Possible financial difficulties)

[Carlisle]

If you take cleaning. to a hospital or network rail, cleaning is not their core activity. so getting in a specialist to clean makes sense. you dont have to spend management time micro managing cleaners, you get on with running the railway. you just spend a little time monitoring the contract and its delivery.

Ok, but as far as the rail industry’s concerned that’s only really been the accepted view for about the last 20 years. Prior to that for most of its existence virtually everything had been in house, with voluntary minimum wage and benefit agreements made long before some recently became enshrined in law .

 

[gswindale]

Yes heard it all before. Private sector is fantastic, efficient, innovative etc etc.... Then I read about big companies going bust or in serious trouble because of incompetent management. And the people at the bottom are the ones who suffer the most. In another thread we keep getting told that the private sector is not the wild west that it's made out to be and that railway workers should not be scared of the private sector. Yet clearly, this being the second big company with large Government contracts the private sector, people's fears about the private sector are somewhat justified. Much like Carillion bosses prioritised dividend payouts over paying into pensions schemes in the months leading up to its collapse. These kind of businesses don't deserve Government contracts, especially when some blame having to pay somewhat decent wages to their lowest paid staff as the reason for their issues.

Once again, you're not paying attention to the content of other people's posts - did I say Private Sector was fantastic? No I did not.

Are you aware of the situation with Northamptonshire County Council? That looks to be a shining beacon of how to run things in the public sector.

If it was managed correctly, that situation would not have occurred - same in the private sector.

In both sectors, when cuts have to be made, it is always the ones at the bottom, so that is no argument against the private sector as you seem to think it is.

 

[gswindale]

There have been some good comments here and as someone who has been involved with a lot of outsourcing there are typically only 3 reasons why an outsource would fail:

• Poor procurement
• Poor bidding
• Poor management

Get these right and it should work. However, many times the subtleties of each are not correctly considered and you find

• A bid submitted on a win at all costs basis so the Business Development Director hits a target and gets their bonus
• A procurement team too week to reject a price that is too low to be sustainable
• A contract management team set up to deliver and not manage delivery (they are very different things)

With regards to in-house delivery there is no reason why this can't work well but it must be able to demonstrate value and quality i.e. Against measurable targets just as a good external service provider would have to do and there be consequences for failure i.e. Staff who don't deliver are sacked if unfortunately necessary. If this can be done why would you outsource apart from those tasks so specialist that no one would do them themselves.

Outsourcing is a complex area oversimplified by many including some involved in it.

If you could "like" a post, this would get one.

I would mention that "Poor Management" applies to both sides of the contract - the client needs to understand the role of the provider and allow them to do what they are good at well without too much interference, but also the provider needs to manage the contract well.

 

[pdeaves]

In the context of railways, whilst I do not have any qualms about outsourcing certain functions, I would argue that cleaning is a core part of the core business. It is something that can make or break the passenger experience and should be as important as, say, selling tickets. Whether in house or outsourced, it should not be an 'add on' and should have the same management priority.

The temptation with outsourced functions is that they somehow don't matter as much; let the company do its stuff and periodically change the supplier if something doesn't suit. I would rather see the same focus as all parts of the business, working through things as one team rather than blaming 'them' (which ever side of the fence you are). I have no doubt that there are good examples where an outsourced or in house 'contract' (not necessarily the right word for in house) is seamless and works to everyone's benefit. I also have no doubt that there are plenty of bad ones, too.

 

[HH]

If you take cleaning. to a hospital or network rail, cleaning is not their core activity. so getting in a specialist to clean makes sense. you dont have to spend management time micro managing cleaners, you get on with running the railway. you just spend a little time monitoring the contract and its delivery.

I hate to quote the example of Southeastern & Whettons at you. That didn't work out so well...

 

[Dave1987]

Once again, you're not paying attention to the content of other people's posts - did I say Private Sector was fantastic? No I did not.

Are you aware of the situation with Northamptonshire County Council? That looks to be a shining beacon of how to run things in the public sector.

If it was managed correctly, that situation would not have occurred - same in the private sector.

In both sectors, when cuts have to be made, it is always the ones at the bottom, so that is no argument against the private sector as you seem to think it is.

I do read posts. Just my ‘BS’ barriers tend to come up. The thing that defends the people at the bottom from poor management is..... unions! I’ve heard certain high profile company bosses whinging about the high cost of labour at the moment (cry me a river!). I’m sick and tired of reading about badly managed companies leaving ordinary people worrying about their pension provisions while bosses walk away without consequence. Like it has already been said examples like this do nothing to persuade people that the private sector isn’t the Wild West with people getting very wealthy off the back of others misery.

 

[43096]

I do read posts. Just my ‘BS’ barriers tend to come up. The thing that defends the people at the bottom from poor management is..... unions! I’ve heard certain high profile company bosses whinging about the high cost of labour at the moment (cry me a river!). I’m sick and tired of reading about badly managed companies leaving ordinary people worrying about their pension provisions while bosses walk away without consequence. Like it has already been said examples like this do nothing to persuade people that the private sector isn’t the Wild West with people getting very wealthy off the back of others misery.

My 'BS' barrier just went up. That looks like something generated by the RMT random press release generator.

 

[gswindale]

I’ve heard certain high profile company bosses whinging about the high cost of labour at the moment (cry me a river!).

Are you sure you're talking about a private company? Sounds more like you're talking about the CEO of a public authority to me!
I deal with an industrial estate owned by a Local Authority - when they purchased it, there were security guards providing overnight security patrols at a very low rate. As part of our management role, we proposed, with the client's agreement to raise the security guard's salaries to a more reasonable rate (I think it was below the National Living Wage to start with). Once the new budget was prepared, the client came back and said that the security costs were too high.
This is therefore a local authority telling us that we can't pay security staff who work in their authority a decent wage despite agreeing that they should be paid more. You will of course note that the security costs flow through the service charge and are therefore recoverable from the occupiers except where there is a vacant unit or a cap.

Thus it is clear that it is not just private businesses that suffer from poor management - anything that is publicly owned seems to suffer from the same issues - just without the risk of going under as there will always be a tax-payer bailout to cover the financial meltdown up.

 

[DarloRich]

Reports they are in deep trouble

Do they have any railway involvement?

carillion going bust affected the railway badly. could Interserve failure do the same?

Interserve hold cleaning contacts. Sorry facilities management contracts

 

[Ken H]

Title changed at mods request

 

[AndrewP]

Deleted