Less than two months following the departure of Executive Vice President John Fry, one of the cornerstones of his tenure in office has fallen by the wayside.
When unveiled in 1998, Penn's decision to outsource management of its facilities was hailed as the most visible and most radical change in the way that the University did business.
It was also arguably Fry's most important move, and one of which he was proudest. It was the first and largest major facilities outsourcing deal signed by a college or university, paving the way for a number of other schools to turn facilities operations to an outside provider and jumpstarting Trammell Crow's very lucrative higher education practice.
While Fry still believes that outsourcing was the way to go, the fact is that the Trammell Crow deal was a failure from day one. After only two years, Penn renegotiated the agreement, eliminating the Dallas-based company's management of the University's on-campus residences and facilities, the most revolutionary part of the deal.
In the end, Penn is better off with Trammell Crow out of the picture. The company was brought in to make the facilities division more cost effective and more responsive. It failed on both counts.
Trammell Crow should serve as a cautionary tale to administrators. Experimenting with new ways of doing business can be beneficial, and restructuring inefficient departments is important. But when a deal looks too good to be true, it probably is.
But perhaps more important, it disproves a central tenet of the Fry era -- that outsiders will always do a better job than insiders.
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