ABSTRACT
Outsourcing Auxiliary Services in Higher Education:
An Integrated Risk Management Model
By
Alfonso A. Quinones
May 2024
Chair: Lars Mathiassen
Major Academic Unit: Executive Doctorate in Business
Managers can explore outsourcing as an alternative to in-house provisioning of various services. Within the realm of higher education on college campuses, institutions deliver auxiliary services directly or indirectly to students, faculty, and staff. These services typically stand apart from the core business of the institution. Outsourcing auxiliary services in higher education has, therefore, been a prevalent practice for decades, encompassing a range of services from food and housing to mental health and wellness centers. These services significantly contribute to students’ life experiences and success on campus.
Financially, outsourcing auxiliary services is often viewed as a straightforward solution, driven by fiscal pressures from both the public and private sectors to cut costs, maintain tuition rates, and explore new revenue streams. However, outsourcing comes with its set of challenges, including strategic misalignment, unrealistic expectations, lack of contractor expertise, and insufficient leadership accountability. Moreover, the complex effects of outsourcing on the student life experience are challenging to assess over the long term.
In the absence of proper communication and understanding of the campus community’s needs, outsourcing can become counterproductive, negatively impacting how students perceive campus life. Despite the intricacies and high stakes involved, the existing literature offers limited guidance to managers in higher education on navigating outsourcing options and overcoming barriers to successful short- and long-term solutions.
Against this backdrop, this dissertation develops a model for managing risks in outsourcing auxiliary services in higher education. The model is based on a review of relevant literature on outsourcing within higher education and across industries, most notably the IT industry. By integrating insights from diverse sources, the proposed Risk Management Model offers a comprehensive structure for handling outsourcing in higher education. To enhance its practicality, the model incorporates risk areas and items, risk resolutions and actions, and heuristics for applying resolutions to specific risks.
