Outsourcing of housing services in Hong Kong: optimization of transaction value

Purpose – Outsourcing is now a common strategy for delivery of property services. Recent reviews of empirical literature find support for the efficiency and cost savings from outsourcing is at best mixed. In the housing context, organizations are still sceptical to the real cost benefit and are reluctant to enter into multiyear outsourcing contracts to deliver their housing management and facilities services. This study aims to investigate whether outsourcing can bring significant cost savings to housing services, and if so to explore how the transaction process should be structured in order to optimize the transaction value through minimization of production and transaction costs.Design/methodology/approach – Single‐case study methodology, based on a typical major housing corporation in Hong Kong, was used to quantitatively examine the impact of outsourcing on cost savings using independent‐samples t‐test, and competition on fees (production cost) using Pearson correlation analysis. Pearson analysis was ...

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