ACCOUNTABILITY: RESPONSIBLE CONTRACTING
Updated On: Oct 24, 2018

RESPONSIBLE CONTRACTING

At its core, contracting work (outsourcing) is not bad per se. Outsourcing is the contracting out of a business process to an independent organization from which the process is purchased back as a service. Contrary to popular belief, you do not necessarily outsource to save money. In fact, outsourcing may not save you money at all. You outsource so that you can focus on your core competencies and the true mission of your organization and hire someone else to do those things you really are not very good at. Here is a classic example: an advertising company’s core business is creating commercials. Now this advertising company has an accounting department in charge of paying its employees. Payroll is not its core business. At some point, the advertising company decides to outsource its payroll department to a “payroll company” so as to devote its attention and resources to creating and selling more comercials. On the positive side, this may result in better and cheaper payroll services thus saving some money to be redirected to its core business, advertising. On the negative side, the employees working at its payroll department need to be laid off. The advertising company becomes leaner, better focused, and more competitive.

Contracting out taken to its extremes can be very detrimental. In “extreme outsourcing” scenarios, companies start shaving off entire departments from their core business. For example, the advertising company decides to outsource the music for its comercials to a record company because they have plenty of musicians eager to write music for whatever purpose. Then it outsources its printing to a desktop publishing company. You get the picture. The advertising company has become an assembly line of disparate departments. In the short term, its shareholders may be quite happy since now the company offers greater dividends, in other words they get more bang for their buck. In the long term, the advertising company loses its soul and the quality of its commercials deteriorates. Why? Apathy. Its employees never get to see the product from start to finish becoming assembly line operators of a product they have little control over. The advertising company employees have lost ownership.

An offshoot of extreme outsourcing is offshoring described as a company relocating a business process to another country. In public services, budgetary constraints coupled with an ideology of “less government is always better” can lead to extreme outsourcing and its very nefarious consequences. In its essence, outsourcing is an exercise in delicate compartmentalizing and careful decision-making. Outsource a bit and you may end up with a more focused and competitive company or a more efficient government. Outsource too much and you kill the company or create a dysfunctional government.

So how does outsourcing fare in the interpreting industry? Except for language pairs in high demand (e.g. Spanish <> English), interpreter services in the US are generally outsourced and for good reason. Unless you are a language company, interpreting is by definition an ancillary service, not a core business. Companies and governments can ill afford the liability created by hundreds of interpreter employees that will be used a couple of times per month at best. Below please find the procurement models currently in use for interpreter services.

In-house: interpreting provided by employees of the entity that requests it.

1.    Bilingual employee: a staff member fluent in two languages who may provide services in another language and/or be asked to interpret (e.g. a Somali <> English nurse).

2.    Staff interpreter: a professional interpreter hired to work as an employee whose job title reflects that position  (e.g. a Spanish <> English court interpreter employed full or part time by the court).

Outsourced: interpreting provided by independent contractors brought in from outside the entity that requests them.

1.    Direct Contracting: scheduling, invoicing and payment of freelance interpreters through a web portal, email, telephone or text messaging.

  • Proprietary: the payer’s IT department develops and maintains its own software (Washington State’s King County District Court).
  • SaaS: the payer leases online software and tech support (Washington State’s Tukwila Municipal Court).

2. Subcontracting:  scheduling, invoicing and payment of freelance interpreters through intermediaries. This can be done either through a web portal or by contacting interpreters one by one over the telephone, email or text messaging.

  • Language agency: paying a commission to a referral services company for scheduling, invoicing and paying freelance interpreters.
  • Brokerage: paying a commission to a company or entity who in turn subcontracts with several language agencies that charge a commission for scheduling, invoicing and paying freelance interpreters.

3. Coordinating entity:  negotiating rates directly with freelance interpreters as a group (labor union) and paying a flat fee to a language agency for scheduling, invoicing and funneling payments to freelance interpreters. Interpreters’ pay simply passes through the coordinating entity (e.g. Washington State’s Health Care Authority for Medicaid enrollees).

Outsourcing should not be synonymous of surrendering your better judgment.  There is a tendency by management to treat outsourced public services as out of sight, out of mind. Nothing is less true. Outsourcing a public service does not absolve management from monitoring, evaluating, and auditing continually to see, whether or not, the taxpayers are getting genuine value for money.  Below please find 10 steps to successfully outsource interpreter services.

  1. Issue an RFI – Request For Information – to learn all there is to know about language interpretation, the service you are intending to outsource.

  1. Seek input from end users, requesters, payers and, above all, the INTERPRETERS without whom none of this can happen.

  1. Experiment in a limited and controlled environment by setting up (hopefully free) pilots.

  1. Draft the contract separating administrative costs from the interpreters’ wages.

  1. Aim for direct contracting by limiting the layers of intermediaries between you and the interpreters who are the ones providing the language interpretation service.

  1. Aim for interagency agreements by consolidating scheduling, invoicing and payment to individual independent contractor interpreters.

  1. Clearly specify the types of interpreters’ desirable credentials for each type of language interpretation service.

  1. Issue an RFP – Request For Proposal – and patiently answer all questions on a public format (e.g. webpage).

  1. Draft short-term contracts with enough wiggle room for down the road adjustments.
  2. Tie the renewal of the contract to performance reports conducted by an independent consulting firm.  What was the fill rate? Were the interpreters properly credentialed? How much did you waste in no shows or late cancellations? Was the administrative cost below 15%?


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