1. When it comes to facility services, including security, concessions, parking, and custodial/housekeeping, there is a choice to keep these services in-house or to outsource those services to an outside party. What are the pros and cons of keeping each of these services in-house versus outsourcing for these services for a 20,000-seat multipurpose arena?
2. Discuss in detail the answer to the following: How much legal expertise is enough for a sport facility manager or owner?
Keeping Facility Services In House versus Outsourcing
Outsourcing refers to where a certain company pays other companies to provide them with specific services. This allows the company to concentrate on its core competencies and offer specialized services to the customers. In the case of a twenty thousand seat multipurpose arena, their main function is managing the use of the facility. Therefore,some services such as housekeeping, concession, parking and security can be outsourced rather than being offered in-house.However, the various advantages and disadvantages of outsourcing should guide the companies in determining whether or not to outsource some of the functions.
Question one- Pros
The management of the arena would not need to hire more employees if they decide to outsource functions such as security and housekeeping. When you outsource these functions, the service providers can be paid as contractors (Patel, 2017). For instance, if a cleaning company is given a contract to clean the arena,it would be their duty to hire cleaners, supervise them and provide them with all the necessary equipment to enable them do their work. This would take a huge burden from the managers of the arena as opposed to if the function would be offered in house.
In addition, outsourcing helps the management of the arena in getting the best people to handle different functions that enable smooth running of their business. Some of the functions such as security are quite critical and the right people should be hired to provide quality services. However, it is evident that finding the right people to do a specific job is a hard task (Steinbach, 2015). For instance,if the arena managers contract a competent security firm to provide them with security, they would not bother with the process of training, equipping and even hiring security officers. This is because a firm that specializes in offering security services has already done that.
Although outsourcing is beneficial to a company, some negative issues may arise in the process. For example, the management lacks direct control of the outsourced functions (Patel, 2017).When a company contracts another company to offer certain services such as housekeeping, it gives up control of that function. Therefore, they are not at liberty to control how the people work. They may give a directive on the quality of services they require however, they may not have the kind of control they need to have in running their business.
Moreover, the relationship between the management and their employees may be affected by outsourcing. Since the management is able to get the right people for a job at a good price through outsourcing, the employees may feel that they may lose their jobs any time. As a result, there may be anxiety at the work place which may in turn reduce the productivity and the quality of work done by the employee. To avoid this, the company needs to assure the employees of their job security.
Most agreements in the sports industry are done through signing of contracts between two or more parties. These contracts are legally binding and in case of breech, any party may be sued. It is therefore important for sport facility managers or owners to have basic knowledge in legal matters so as to understand the contracts they get into. However, the managers may have a way of avoiding the legal nightmare through outsourcing. For instance, athletic departments that choose to outsource concessions benefit immensely from the peace of mind that is experienced from a management standpoint (Steinbach, 2000). Concession contracts may be quite a nightmare for sports facility owners and managers due to a lot of legal requirements. By opting to outsource concession, the facility managers are able to concentrate on their core functions of managing the sport facility rather than dealing with legal matters.
In conclusion, outsourcing is a good way of ensuring that a company concentrates on its core competencies. However, managers need to weigh the advantages and disadvantages of outsourcing before making any decisions. In addition, they should also have basic knowledge in legal matters so as to ensure they understand the kind of contracts they get into so as to avoid legal suits.
Patel, D. (2017). The Pros and Cons of Outsourcing. Forbes. https://www.forbes.com/sites/deeppatel/2017/07/17/the-pros-and-cons-of-outsourcing-and-the-effect-on-company-culture/#59b6e3bd562d
Steinbach, P. (2000). The Benefits of Outsourcing Concessions. AthleticBusiness: The Resource for Athletic, Fitness and Recreation Professionals.
Steinbach, P. (2016). The Benefits of Outsourcing Concessions. AthleticBusiness: The Resource for Athletic, Fitness and Recreation Professionals. https://www.athleticbusiness.com/event-security/outsourcing-event-security-brings-challenges-advantages.html