5.3.2 O&M Approaches

In meeting the ITS O&M challenge, the MDSHA will be faced with a series of technical and business opportunities. For every opportunity, there is, however, an associated risk and the CSC/PBFI Team will assist MDSHA in evaluating the benefits and risks of each alternative. The following discussion reviews the benefits and risks associated with in-house support, privatization, and facilities management. In-House Support

The first option is for MDSHA to continue to support the O&M of CHART II with in-house forces much as it does today. Table 5-1 illustrates some of the benefits from in-house support.


Table 5-1. In-House Support Benefits

CSC/PBFI Advantage: In-house support offers a way to continue high-tech growth within an organization.

In-house Benefits


Establish a high-tech career track within the State government.

Share staff with other departments with similar needs.

Recruiting, retention, and staffing technology positions is difficult in this region, with private firms offering high salaries to personnel with similar qualifications

Traditionally difficult to control costs and maintain quality standards, for the reasons cited above

Competing priorities within the State government make it difficult over the long term to maintain the commitment

The problem with utilizing in-house support is the maintaining of skills necessary to support the fast changing technologies. Where required, in-house support can be supplemented by utilizing contractor support as you do today. In this case, the CSC/PBFI Team can contribute to the efficiency of the effort by providing consulting services during the system start-up phase to include:

- Technical. Training on maintenance of controllers, communications facilities, central hardware, central software, and other similar components. This training would cover how to manage the maintenance of the physical infrastructure for the system.

- Business. Training on how to develop O&M contracts for special tasks, how to develop ITS public/private ventures, and other similar tasks.

- Budgeting

- Staffing levels and skills

- Annual work program development

- Regional traffic management coordination

- Development of incident management strategies including timing plans for diversion routes and

- Other similar tasks


        1. Contractual Services

The MDSHA could contract out a larger portion of the O&M of the system. Accomplishing the needed functions through a contractor that would steer its efforts through a well-defined set of contractual criteria. Contracting is characterized by careful development of a detailed, clearly defined set of contractor requirements, including task descriptions, schedules, performance standards, and payment terms.

Privatization contracts (contract for services) normally:

These contracts have been a mainstay in the service industry for decades, and, therefore, many contract models are available for the MDSHA to utilize. Table 5-2 illustrates some benefits resulting from contracting operations and maintenance responsibilities.


Table 5-2. Contracting Benefits

CSC/PBFI Advantage: By contracting O&M to an outside company MDSHA can obtain experts in the field.


Contracting Benefits


Clear separation between government and contractor responsibilities

MDSHA can decide what tasks it wishes for the contractor to perform, and which it wishes to perform with its own forces

Little flexibility to get services outside the specific scope without extensive administration and additional cost

Little incentive for the contractor to exceed performance standards or accomplishment criteria

The Network Management Services (NMS) contracting vehicle that is currently in place is an example of this option and could be used in conjunction with the some of the tasks included in this project. MDSHA has made attempts to use this vehicle to support the maintenance of the existing CHART system. Likewise, this option is available to MDSHA to support the CHART II system. Facilities Management

The third option discussed here is for the MDSHA to engage a facilities management contractor in a public-private venture for the purposes of system O&M. While facilities management (FM) shares some characteristics with contracting out, it also provides a level of flexibility and incentives for both parties that a services contract does not.

Facilities management, or facilities outsourcing, involves use of private-sector staff to perform traditional government services, working on a broad mission basis, and targeting the standard of mission accomplishment. Although facilities management is a new concept in traffic management, it is a tried and true method for providing service in other high-technology environments, including computer facilities, law enforcement dispatching systems, and telecommunications systems.

Facilities management is different than contracted services, where the private contractor is required to follow the explicit directions of the government manager. Under a contracted services arrangement, there is little incentive for the private contractor to control costs, because it is paid by the person-hour employed. Under facilities management, the private-sector firm and the government agency have congruent goals and the same incentive to succeed. Because it is paid for mission fulfillment, the private-sector contractor has the incentive to seek efficiencies and cost-effective techniques for achieving the contract objectives.

This type of proposed partnership recognizes that both the MDSHA and its contractor want to capitalize on the investment in the implementation of the CHART II System. They both have incentive to ensure that its operation provides a high level of reliable service to Maryland citizens and visitors under both normal and incident conditions. At the same time, because of the significance, location, and visibility of this system, MDSHA and its contractor will also want to showcase the system. CHART II can be an example of how a true public/private partnership can work to effectively and fully use all of the capabilities of an advanced transportation management system, benefits of this can be seen in table 5-3.


Table 5-3. Facilities Management Benefits

CSC/PBFI Advantage: Facilities Management provides common goals for those involved.

FM Benefits


Keep up with technical realities

Keep up with business realities

All public/private ventures are risks if incentives are not carefully crafted.

Control and Liability concerns.