Niyamath Parveez

In this day and age, it is perhaps not great news to see a firm so heavily linked with nuclear arms to be doing well. Given that this is exactly the issue that leaves some countries eyeing each other nervously whilst stockpiling a little something in reserve, is it any wonder that most right minded people in the world shift a little uncomfortably in their seat nuclear power rears its ugly head? This is not the only reason that Serco has made money and been in the news recently, the company also runs the London Docklands Light Railway system, as well as Britain’s nuclear arms but they have really cleaned up thanks to the Government move to outsourcing.

Outsourcing was seen as the solution for many firms looking to reduce their labor costs without compromising the quality of the service but the success has not gone unnoticed. This means that many governmental bodies and departments have realized that they too can improve their financial situation by outsourcing a great number of their services which has opened the door for private firms to clean up and make a good chunk of money. The public will moan but then again, they would moan if the Government body weren’t chasing the most effective and efficient option for their money so it is hard to see if they would be pleased with any option. Quite often, a council department is damned if they do and damned if they don’t, which is exactly the situation they face when they consider outsourcing. This is why so many of them are now deciding it is worth their while to outsource, ignore the public furore and make plans with what to do with the money they saved.

Serco managed to deliver half year pre-tax profits of around £80m, a rise of over 30 per cent, which when you consider the current economic climate, is not bad going. There can’t be too many firms or industries experiencing this sort of result, so whilst it is only right to doff your cap to the firm for managing this, it should further underline the importance that outsourcing can have for firms. Yes, the usual focus falls upon the firm who is outsourcing their work but just think what this trend means to the firms who are providing the outsourced supply of work. With so many companies and government bodies reading that this is a golden opportunity, it remains to be seen how many more try to jump on board the outsourcing bandwagon.

Serco have managed to capture a whole host of outsourcing contracts with the current London Mayor, Boris Johnson, handing out a lot of deals. One of the more interesting and potentially lucrative contracts that Serco have obtained is the contract for the London cycle scheme. There are obviously environmental reasons for this sort of deal to be a major success and if it is given the proper push, there is no doubt that this could see a lot more money flow towards Serco in the near future.