How to Effectively Manage Your Maintenance Program-Answer Key - How to Effectively Manage Your Maintenance Program

Answer Key - How to Effectively Manage Your Maintenance Program - Activity 4

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The Greensville Housing Agency is evaluating whether to continue performing landscaping services in-house for Laurel Park Apartments or to contract these services out. The costs of maintaining landscaping in-house include personnel expenses of $40,500, benefits amounting to $12,600, equipment costs of $3,200, and materials such as gas totaling $1,190. In contrast, the agency can contract out the landscaping at a cost of $700 per week for 40 weeks and $470 for 12 weeks annually, resulting in a first-year cost of $33,640 for contracted services. <br /><br />In a cost-benefit analysis, the direct costs of in-house landscaping sum up to $57,490 for the first year. Additionally, indirect costs of in-house work might arise from maintenance staff being diverted from other duties, potential equipment damage, and possible delays in completing landscaping due to competing priorities. Though there are benefits, like knowing the residents and setting service standards, the costs and inefficiencies seem to outweigh these.<br /><br />On the other hand, contracting out might result in some loss of customer service quality and resident recognition. However, it offers benefits such as staff with specialized training, insurance coverage for damages, and the efficiency of often having a team complete the work. <br /><br />Given the significant difference in direct costs ($57,490 versus $33,640) and the added benefits of specialization and lower indirect costs, contracting out seems to be the more cost-effective and beneficial option for the Greensville Housing Agency. The agency would need to manage any potential drawbacks, such as ensuring service quality and resident engagement through contract management.

Keywords

Greensville Housing Agency

Laurel Park Apartments

landscaping services

in-house costs

contracting out

cost-benefit analysis

direct costs

indirect costs

service quality

specialized training