Operation Management Ii

1. In Outsourcing context, a company have to pay attention to several factors before it decide whether the work would be performed in-house or not. The factors are:
- Available Capacity
- Expertise
- Quality Consideration
- Nature of Demand
- Cost
- Risk
In this case, the advantages that Deaconess Clinic, as a service company, would have if they performed it in-house would be at quality and risk factors. If the cooking activity performed within the hospital, it would be easier for the management to control the quality of the food, and minimizing the risk of contamination from outside. Other than that, employees could feel more about the “family” atmosphere if they doing the activity in a same room and doing teamwork.
On the other hand, if the hospital decides to have the activities done outside the hospital’s area, it could save cost and area consumption. The hospital could use the area for cafeteria’s kitchen for other purposes, such as storage or warehouse. It also could save the hospital’s expenses, such as for gas and electricity.
As the summary, a complete calculation and study will be needed for the company before it can decide which one is better.

2. In the housekeeping situation, there are still several benefits that the hospital could earn from outsourcing system. Rehiring previous employees would solve the problem in the personality area, but outsourcing the employees would free the hospital from obligation to give them benefits and insurance. Also, it would free the hospital to take care the administrative matters, such as payroll reports, recruitment process, tax calculation, etc.

3. If the hospital could join with other hospitals to outsource their laundry service, it could increase their bargaining position. They could manage to get lower price from laundry service provider, and also set their own standard in