EVALUATION AND DECISION METHOD OF OUTSOURCING
IN THE ADMINISTRATION
Tsuyoshi, KARIYA, Masanobu, NAGANO, Seigo, NASU
Kochi University of Technology
ABSTRACT: Presently, in Japan, the financial condition of local government and prefectural goverrnment isfalling into an unprecedented crisis. As a result many local governments have come to reconsider, reduce or
eliminate many administrative functions and public works projects. Therefore our local governments can’t
avoid a decline in quality of services. And also when local governments choose the method of outsourcing,
most of them haven’t done appropriate decision making. A change for the worse of the financial condition of
local governments is caused by an increase in social security outlays for an aging society and also financial
demand by increasing standard of resident’s services. In order to change the financial situation, the current
budget – making system and state subsidy system have not always been ideal. Also there are many points at
issue in local government conditions which are extremely dependent on the finances of the state.
This research proposes a new governmental management system with a comprehensive evaluation anddecision method of outsourcing projects to the private sector.

This is why this system suggests deciding

local government’s policies which combine outsourcing to the private sector, total budget and personnel
resources. Outsourcing is critical for administration work at the moment. As the result of constructing thissystem, although there is some possibility of achieving simplification of administration, the method doesn’t
give a route by which to solve farsighted problems of local governments.
So this research proposes an evaluation and decision method of outsourcing of work as one of methods for
efficient administration.
KEYWORDS: Local Government, Administrative Management, Outsourcing
1. INTRODUCTION

immediately have to investigate the causes that theirorganizational framework and financial system is

Presently, in Japan, as the local governments have

keeping expanding but also review and requested tothe debt of 200 trillion yen or more, their financial

try to restructure social systems that surround local

pictures are very unprecedented crisis. Therefore thegovernments and local government’s system.

local governments which decide the review and thetermination of the various administrative works are

1.1 Background and purpose of research

not endless. This is a natural result that the local
governments lose sight of a conventional, essential

In these years, the economy in Japanese society hasrole and don’t appropriately choose desiring andbegun to be sluggish after the collapse of thehave been continued to submit for the resident’s

economic bubble and have passed through the span

public services which keeps inventing them everyof “lost decade”. In addition, on the one hand due today. Therefore the local governments not only

uncertainly over social security in the future, spreadof the nuclear family and the trend toward fewer

decided by Koizumi Cabinet at the end of June inchildren per family are progressing, on the other

2003, the revolution in distribution of allocation tax

hand, the advances in medical science that keeps

made continuing the local government moredeveloping has been rapidly extended the life

difficult.

expectancy and has rushed into the super-aging

Therefore, the administrative work have been madesociety which is unparalleled also in the world.

to the division of labor and been specialized, theAccording to the transition of our country’s sectional

budget that the local government holds expands, insocial security benefits (the pension, medical

addition, the number of staff who related to thetreatment, welfare and so on) from year 1970 to year

administrative

2003(Figure 1.1), the amount spent on socialorganization mechanism has been complicated.

work

have

increased

and

the

security keeps increasing year after year. This is thereason that the nursing insurance system that started

1.2 Structure of problem

in April, 2000 in addition to the failure of pension
system and the medical treatment expense that keeps

As for the outsourcing that has been done up

soaring comes in succession, too and the state

to now in the local government, there is no clear

contribution etc, that had to be donated welfare

method of the decision making no criterion when

additionally increased.

anexternal

consignmentis

decidedandevaluated but the administrative work is not（Trillion
Yen）

45

performed to the verification of the validity ofPension44 Trillion Yen（31.6%）

40
35
30

the external consignment when the external is

Medical Treatment
26 Trillion Yen（31.6%）

consigned. Furthermore, neither a concrete

Welfare etc
12 Trillion Yen（15.3%）

that consigned the external was proper were

25
20
15
10

provided.
Moreover, it comes off from essence that the5

weak point field that is an original meaning of

0
70
19

criteria nor the check function whether the work

73
19

76
19

79
19

82
19

85
19

88
19

91
19

94
19

97
19

00
20

03
20

（Year）

outsourcing is external consigned from talent's
ability in the organization etc. and it specializes

Figure1.1 The transition of sectional social security

in the specialized field, and the problem of thebenefits

implementation confirmation the work thatconsigns the external of which the standard is

What is more, as central government and local

resident's satisfaction rating and the quality

governments has cordially protected development ofcontrol remains being left.

a region and the program for town management as

Then, this research is used to deal with such awell as has promoted public works investment

problem (Figure 1.2), that the method of

aggressively until now, almost of the local

deciding an installation of criterion and an

governments are not possible to manage it inexternal consignment is constructed with theindependent revenue sources alone. In such a social

analysis of the problem of the system structure

environment and financial background, by havingof past outsourcing to make of an externalbeen worked out “the reform of the Trinity” that wasconsignment of the local government proper, andnew"Management

systemofoutsourcing"proposes it.

local government today.
“Outsourcing” is “making of resource the outside”

Review ofadministrative work

Examination
cost■Conventional Management System

Outsourcing Outsourcing

Decisionmaking model

Criterion ofevaluation

and until now, it was possible to mean that “theenterprise must consign their business or a part offunction outside of a special trader and the

Judgment

Criterion of
judgment

quality of the resident service becomes strong in theProcess of
systemCost
management

Staff skills

subsidiary”. Nowadays, the local government cameto promote an external consignment positively and it

Syst

em M
ainte
nanc

R
adm eviewofinistr
ative
work

Crite
ri
judg on ofmentDemak cision
ing m
odel

■New Management System

Evalu

Evalu
ation

e

Qua
lity

Management System
of Outsourcing
Proc
e

ation
fu

nctio

n

Cos
t ma

nage
men

ss ch

tends to mean that it generally with the privateorganization, NPO, and furthermore to consign a part

Con
trol

Outs
ourc
in

of the administrative services or all of them to thegindividual. The technique of outsourcing had beenartttaken since this economy received the boom the day

Figure1.2 Propose of new outsourcing systembefore when the asset-inflated economy collapsed
though the financial picture of the local government
falls into a critical situation and the technique of

2. What is outsourcing?

outsourcing had become a main current. The change
The local government in our country has answeredin

the resident needs by taking a variety of clericaldeterioration of the local government has come towork businesses according to the enhancement of

have a very important meaning as a means ofhigh economic growth and the social security systemstrengthening the competitiveness in the marketplace

after the war in the organization. This means a role

and as what should be of roles between public andoriginal between government and the people inprivate sector.

“thebusiness

environment”

offinancialaddition to having been depressing the frame fromthe range of the defense of current administrative

3. Construction of outsourcing management

service even to the service offer area of the jumping

systemover private company has collapsed.
Moreover, in recent years, it is difficult in a current

3.1. Project management of administrative work

financial picture and the organizational frameworkthat has been followed from generation to generation

Then, it proposes the method of constructing theto complicate, and to secure an enough amount ofadministrative management system concerning thethe service supply and a satisfying quality for aadministrative work that pays attention to a solewide-ranging, public service according to themethod of outsourcing that is the theme of thediversification of a social background that keeps

research.

changing rapidly and administrative service.

First of all, the charge of the work that accompanies

For such reasons, the work that the organization

all divisions, rooms, bureaus, and them is encodedholds is consigned to the specialized field bybased on a typical organization mechanism chart of a

introducing

certain local government and it arranges it (Table

a

sole

method"Outsourcing",

strengthening the weak point field is aimed at, andmovement to try to prevent the decrease in the

3.1).

inside the other similar work as convicted matter andTable3.1 Work management code list

adjustment item except work in daily life are◆Local Government Work Management Code List

included in all the administrative work which is■Affiliated agency
0700000 Local finance Division
0700100 Section of Local Finance
0700200 Section of Local Administration
0800000 Planning Division
0800100 Section of Planning and numericalstatement
0800200 Section of Regional Development
0800300 Section of National Land Survey■City mayor departments and agencies
0800400 Section of Location Promotion of
Self-Defense Forces
0500000 General Affairs Division
0900000 Revenue Division
0500100 Section of General Affairs
0900100 Section of Property Tax
0500200 Section of Personal Affairs
0900200 Section of Citizen Tax
0500300 Section of Office Administrator
0900300 Section of Receiving Cashierand Publication
1000000 Citizen Division
0500400 Section of information implementation
1000100 Section of Citizen
0600000 Disaster Prevention Countermeasure Division
1100000 Human Right Division
0600100 Section of Disaster Prevention
1100100 Section of Human Right
and Traffic Safety
1200000 Environmental Measure Division
1200100 Section of Environment
0100000 Congress Office0100100 Section of Congress
0200000 Auditing Committee Office0200100 Section of Audit
0300000 Board of Elections
0300100 Section of Election
0400000 Agricultural Committee Office

investigated.
◆Local Government Accounting Code List
■00000 General Account■1000000001 Congress expense
00001-1 Congress expense

10001

00002 General affairs expense
00002-1 General administration
expense00002-2 Expenditure for tax collection

local government, its organizational framework is

National health insurance Special
Account
10002 Healthcare of the aged Special Account10003 Nursing-care insurance Special Account10004 Water supply project Special Account10005 Sewerage works Special Accountto be continued・・・

00003 People’s livelihood expense
00003-1 Social welfare expense
00003-2 Child welfare expense

Both general account and special account in
the local government are coded.

To be continued・・・

By encoding the organization mechanism in theSpecial Account00004 Medical expense
00004-1 Health services expense
00004-2 Clearance expense

By coding the items of expenses in bothgeneral account and special account, theadministrative work is linked clearly withbudget of local government.

00005 agriculture, forestry and fisheries
industry expense
00005-1 Agricultural expense・・・

clearly articulate and also the budget that eachdivision executes and the business system in the

Figure3.2 Work management code list

organization can be understood. Additionally, it isprofitable for the clear setting of "Unit of the

As the end of the project management of

subcontract of the business" not only to become

administrative work, the work level is set in order topossible when the staff examines outsourcing but

decide the range to outsource them. By this setting,also to be going to make the business manual etc. ineach staff is accomplishing what work every day,the future.

and whether it is done according to what procedure

Secondarily, each accounting code is given to thewhen the work is accomplished can be understood.

division, room, and person in charge's codes and it

The method of setting the work level and theclarifies how each section is related to the budget.

procedure are shown as follows.

The purpose of this is to understand the whole image

Hierarchy at level in this system consists of three

as the staff in charge who executes the workhierarchies( from LevelⅠtoⅢ), LevelⅡis an object

manages and the each budget and has executedof outsourcing (Figure(Figure3.2). However, as the local government has

work level is shown as follows.

introduced already a peculiarity financial accounting(1)Work Level. Ⅰ : It sets it by summarized

system, although it has an accounting code inside it,classification of the work.

this accounting code is different from a past, simple(2)Work Level. Ⅱ : It sets it by individual

accounting code, for this cord has the necessity foradministrative work based on Work Level.Ⅰ.

making it link with the idea of subcontract of work(3)Work Level. Ⅲ : It sets it by work flow ofbased on the method of the outsourcing.

individual administrative work based on Work Level.

Thirdly, all the administrative work which eachⅡ.

section provides as public services is investigated
and they are reorganized. At that time, points thatshould be noted are that those items have to delete
from the list of the administrative work or comprised

3.3). The definition of theCriterion of judgment concerning Rank A: If the◆Setting up the level of work
■1400000 Insurance medical treatment Division
1401000 Section of Insurance, Pension, Medical treatment
1401100 National Health Insurance
1401200 Pension
Work Level.Ⅲ（Flow of work ）1401300 Medical Treatment
1402201-1-1 Administrative Work D-1
Work Level.Ⅰ Work Level.Ⅱ■1402000 Section of Nursing insurance
1402201 Work of Qualification management
1402101-1 Administrative work A
1402101-2 Administrative work B
1402101-3 Administrative work C

1402201-1-2
1402201-1-3

Administrative Work D-2
Administrative Work D-3

1402201-2-1
1402201-2-2
1402201-2-3
1402201-2-4
1402201-2-5

Administrative Work E-1
Administrative Work E-2
Administrative Work E-3
Administrative Work E-4
Administrative Work E-5

1402201 Work of Accreditation management 1402201-3-1 Administrative Work F-1
1402201-1 Administrative Work D
1402201-3-2 Administrative Work F-2
1402201-2 Administrative Work E
1402201-3 Administrative Work F
1402201-4 Administrative Work G
Level.Ⅱ is set on work for an
1402201-5 Administrative Work H

administrative work falls into either of the criteria
from ① to ③, it is judged as “abolition”.
Criterion of judgment concerning Rank B: If theadministrative work doesn’t correspond to either ofcriterion of judgment concerning Rank A, it isjudgedas“an

4.1 Necessity judgment of administrative work
Then, it is Level based on the decision making
model of outsourcing as for the administrative work
to which it is encoded and the business level is set.

with

There is no necessity on administrative work.
①

4. Decision making model of outsourcing

work

continuance”.

outsourcing.

Figure 3.3 Setting of Work Level

administrative

The necessity of administrative work is declined and its accomplishment value
has already been lost by the change in a social structural background.

Rank A
Criterion
The continuing existence of significance in the administrative work has alreadyof② been lost by improvement or elimination of a law or an establishment.
Work Level.Ⅰ Judgment
Work Level.Ⅱ
The necessity of administrative work has already been lost or decreased■1402000 Section of Nursing insurance③ by deteriorating in resident’s needs.
1402201 Work of Qualification management
1402101-1 Administrative
Rank B Work A There is a necessity on administrative work.
1402101-2 Administrative
Criterion Work B
The administrative
work which doesn’t correspond to either
1402101-3 Administrative
Work
C
of
judgment of criterion of Rank A.
1402201 Work of Accreditation management
1402201-1 Administrative Work D
Rank A
Rank B
1402201-2 Administrative Work E
1402201-3 Administrative Work F The necessity of
Execution
Termination
1402201-4 Administrative Work G administrative(Continuation)
work
1402201-5 Administrative Work H

Work Level.Ⅱ

Rank A：It doesn’t do on the administrative work.
Rank B：Go to the matrix of the administrative work pattern.

Whether the administrative work which is set by

Figure 4.2 Flow of the necessity criterion ofWork LevelⅡis not possible outsourcing or possible

judgment of the administrative work

is judged.
First of all, It is judged whether the administrative

4.2 The administrative work patternwork in the Level Ⅱ work is necessary or notnecessary in the local government. In that case, theNext, it classifies work which was judged to benecessity of the administrative work is judged by

Rank B by the character of work based on thenecessity criterion of judgment of the administrative

administrative work pattern. The characteristic of thework (Table 4.1) and when the necessity doesn't

work that does outsourcing can be recognized byexist as the administrative work, it is judged “Rank A

doing this character classification. From the work

= Termination” or when the necessity exist as theexperience with a current author, the pattern of theadministrative work, it is judged “Rank B =work was classified into six types from the following

Continuance”. Table 4.2 is a flow of judgment.

α to ζ. The definition and the table of the work
pattern (Table 4.3) are as follows.

Table 4.1 The necessity criterion of judgment of the(α) Fixed form work: Work that is called generaladministrative work

affairs done in staff most usually and that doesn't
especially need qualification to perform the activities.

There is no necessity on administrative work .
Rank A
Criterion of
judgment

Rank B
Criterion of
judgment

Ex) Resident's card issue, Payment of staff salary,①

The necessity of administrative work is declined and its accomplishment value has
already been lost by the change in a social structural background.

②

The continuing existence of significance in the administrative work has alreadybeen lost by improvement or elimination of a law or an establishment.

Document management work etc.

③

The necessity of administrative work has already been lost or decreased bydeteriorating in resident’s needs.

( β )Special work: Work that needs special

There is a necessity on administrative work.

The administrative work which doesn’t correspond to either ofcriterion of Rank A.

qualification and work experience.

Ex) Measurement, Design, Child care work, andto outsource or not.

Nursing service etc.

The advantage to judge the administrative work by(γ) Policy and measure adjustment work: Work that

this matrix is that it has each character and if its

needs important decision making, and doesn'tcharacter is different, the stage of judgment is also

become familiar with outsourcing.

different. Additionally, the decision making model ofEx) Staff's personnel management and work

outsourcing in the most of local governments

concerning administration and finance reform etc.

actually consists of same roots or process of(δ) Project management work: Establishment of

judgment. Stage setting of judgment and process by

integrated promotion plan of local government,

the pattern of decision making is as follows.

holding of various events and symposiums etc.

(1)α: The administrative work that is judged as the(ε) Facilities management work: Work concerning

fixed form work is judged by decision making model

maintenance management such as facilities that local

Ⅰ.

government owns.

(2)β or δor ε :The administrative work that is

Ex) Control of maintenance of public office building, judged as the special work or project management
facilities for Senior Citizens and the Disabled,

work or facilities management work is judged byassembly houses, sport facility etc.

both decision making modelⅠand decision making(ζ) Other work: Work that staff of local government

modelⅡ.

is chiefly obligated to be engaged.

(3)γ or ζ:The administrative work that is judgedEx) Work concerning fire fighting and disasteras policy and measure adjustment work or otherprevention, work concerning election of head andwork don’t need to judge by decision making model.

assembly member etc.

That is to say, this is a reason that it isn’t suitable for

Administrative Work

α. Fixed form work

○Service to the public over the counter○Payment work ○Public bidding work ○Audit work
○Tax collection work ○Material management○Work for taking the conference minutes○Statistical survey ○Document management○Work for taking in and out of materials○Budgetary planning work
○Work on an ordinance etc

β. Special work

○Work for public project ○Survey work ○Cooking food work
○Cleaning work
○Child care service ○Elderly care service ○Work for medicament○Bus service ○Website maintenance○System development of computer ○System maintenance of computer○Illustrative rule management etc

γ. Policy and measureadjustment work

○Personal management ○Assembly steering work
○Work for reorganization of a system○Work for administrative and financial reform○Generalization of budgetary planning etc

δ. Project management
work○Establishment of a variety of plans○Promotion of sightseeing ○Work of international exchange○Plan a variety of events and symposium○Holding of lecture meeting and workshop etc

ε. Facilities management
work○Control of maintenance of the government office○Control of maintenance of the community facilities

ζ. Other work

○Work of extinguishing fire and disaster prevention○Official commendation ○Work of election etc

outsourcing on character of the work. Therefore, it
doesn’t need to judge by decision making modelⅠ
andⅡ,as a result, it is judged the administrative
work(= core work) and the local government need to
execute in itself.

Work Pattern
Level Ⅱ
Code / Name

Fixed form

Special

Policy andmeasureadjustment

Projectmanagement

Facilities
management

Other

α

β

γ

δ

ε

ζ

Flow

1
2
3

Table 4.3 List of administrative work pattern

45

4.3 The matrix of the administrative work pattern

6αThe fixed form work : This is judged by decision making model Ⅰ.
The special work or project management work: These are judged by both decision

The character of the work is understood from theβ・δ・ε making model Ⅰand decision making modelⅡ.
γ・ζtable 4.3 and then it describes to the pattern matrix(Table

4.4).

From

this

patternmatrix,theadministrative work is judged whether it is capable

Policy and measure adjustment work or other work : They don’t need to judge by
decision making model.

By judging the characterof the administrative work,
it is understood the feature
In itself,

Figure 4.4 The matrix of the administrative work
pattern

4.4 Criterion of judgment based on the exclusive

able to be protected by confidentiality agreement, it

competency and external consignment

passes the process for decision making.
Decision making model Ⅱ :As the process of

On this section, the administrative work which is

judgment, this model is judged sequentially from ①

classified by the administrative work pattern isto ③ (For example, if ① is OK, next ② isjudged concretely by decision making modelⅠandjudged and then if ②is OK, next ③ is judged.). If

Ⅱ

all the criteria items are OK, its administrative work

whether it corresponds to Rank 1 or itcorresponds to Rank 2 (Table4.5).

isjudgedbycost

management

systemofadministrative work.
Table4.5

Thecharacterclassification

of

the

administrative work

As the overall notes of this decision making model,
from the fact that the local governments are different
from many of thing, for example, the number of

The characterclassification of work

Rank 1

Rank 2Administrative work
＝Core work
（direct management ）Outsourced administrative work
＝Non core work
（Target of outsourcing）

work, accomplishment procedure of work and theenvironment that surrounds the local government,
the criteria item in these decision making modelⅠ
andⅡneeds to be maintained in order to made to

The following table shows the content of decisionadjust to the local government that introduces thismaking modelⅠandⅡ, the process of judgment, its

system. That is to say, they have to be changed or

criteria and overall notes on this model.

modified.

Table4.6 Decision making modelⅠandⅡ

4.5

Whether it should be voluntarily done directly or whether there is a necessity as anadministrative work in the local government is judged.

Decisionmakingmodel
Ⅰ
Criterion

Ⅱ
Criterion

andsignificance

of

cost

management system sheet of administrative work①

The act is ruled by legal restrictions that the administrative staff have to do theadministrative work.

②

The administrative work is fraught with a public power or is applicable to exerciseof public power.

③

The authority of the administrative work cannot be represented by others.

which is judged by decision making modelⅡ, it is④

The policy judgment and the decision making are required in the administration as
the policy, the measure, the planning, the adjustment, the decision and so on.

necessary to compare the costs between the local⑤

Protection of individual information, the secret and the crisis management arestrongly requested

It is judged whether the outsourcing of the administrative work is an enable to be
concretely done .
Decisionmakingmodel

Introduction

By managing the administrative work at cost pricegovernment and the private sector.
That is to say, by comparing the expense accounts①

The outsourcee exists. For example, NPO, SOHO, MB, Individual, Private sector
and so on.

between the local government and the private sector,②

Knowledge and the skills of the outsourcee is more excellent than those of thelocal government.

the administrative work is made whether it is③

The implementation confirmation of the administrative work that outsourced iseasy.

decided whether outsourcing can be finally done.
Therefore,

thissystemintroduces“cost

Decision making model Ⅰ : As the process ofmanagement system sheet of administrative work”

judgment, if the administrative work is applicable toand it is assumed the indicator of the cost judgmentfrom ① to ⑤ even by one, it is judged as Rank1

in an external consignment (Table 4.7).

and is executed by the local government in itself. As
notes, even if the administrative work is that it isrequiredstrongly

theprotectionofpersonal

information, confidentiality and risk management,
when it is outsourced and made a contract, if it’s

Table4.7

Costmanagement

systemsheetof

Next, to quantify the decision making modelⅠ, theevaluation function of the decision making model

administrative work Ver.1.0

Ⅰis constructed.
Division CodeDivision Name

Section Code

Section NameWork Level.Ⅰ CodeWork Level.Ⅰ NameWork Level.Ⅱ CodeA-CodeB-CodeC-Code◆①Employment Cost
Official labels

Table5.1

Work Level.Ⅱ Name

Account Code

（Unit-cost：Yen）

Sequence of
Numbers

Time /
Quantity

Hourly rate /Unit cost

Benefits package

Mutual aid
expenseTotal necessary
cost

S1

The

S3

Criterion of judgment

S5

D-Code②＝X2（A）◆②Other overhead costs
E-Code（Unit-cost：Yen）
Item

Unit

Quantity（Number of times）

Unit cost

Amount（Necessary cost）

concerning（Input value :Yes=0, No=1)
Yes=if applicable No=not applicable

①＝X1

S4

Total

function

decision making model Ⅰ
Decision making
modelⅠS2

evaluation◆Evaluation function:
f1=X1×X2×X3×X4×X5③＝X3

Remarks column

④＝X4
⑤＝X5

Total other overhead costs◆Inclusive sum（A＋B）

（B）

（C）

Until now, when the local government put together■Decision making modelⅠ∴ f1=X1×X2× X3×X4×X5=0∴ f2=X1×X2× X3×X4×X5=1

Administrative work in thelocal government（Core work）Rank1
Outsourced administrative
work（Non core work）Rank2

budget which cost the administrative work, it hasn’t
needed to calculate “labor cost” in detail, for theThis evaluation function replaces the item of

local government has a system of duty assignment

criteria from ① to ⑤ on the decision making

and job classification which set down the municipal

modelⅠwith the parameter of 5 phases from ①=X1

by law or rule, its compensation system is decided

to ⑤=X5 and it is judged that when comparing withby the appointment and years of experience. In

the each criteria and corresponding to each criteria,

addition, the labor cost has been calculated by theYes equal to 0 and not corresponding to each criteria,

staff on General Affairs Division which takes charge

No equal to 1.From this decision making modelⅠ,of staff's payroll accounting and payment. But inwhether the administrative work corresponds to

private sector, when the expense account is estimated, Rank 1 or it corresponds to Rank 2 is judged (Table
the hourly wages and the time required a staff

5.1).

engaged in the business are clearly calculated for thework. So, when thinking about the expense account

5.2. Modeling of decision making modelⅡthat requires it, such detailed calculation grounds inthe local government are necessary. Today that exists

This evaluation function replaces the item ofin a situation critical the budget of the local

criteria from ① to ③ on the decision making

government, it has to renews the idea of pastmodelⅡwith the parameter of 3 phases from ①=X1

budgetary process and change the constitution

to ③=X3 and it is sequentially judged that whenmanaged by cost.

comparing with the each criteria and corresponding
to each criteria, Yes equal to 0 and not corresponding

5. Deriving of evaluation function concerning

to each criteria, No equal to 1.From this decision

decision making model

making modelⅡ, the combination of the judgment
results is as shown in the following Table5.2.

5.1. Modeling of decision making modelⅠ

Table5.2

Theevaluation

functionconcerning

ⅠandⅡwere replaced the evaluation function anddecision making modelⅡ
Decision making
model ⅡIn section 5.1 and 5.2, the decision making model

Criterion of judgment（Input value: Yes=0, No=1)
Yes=if applicable No=not applicable①＝Y１

then the process of decision making model was◆Evaluation function：
f2=Y1＋Y2＋Y3

②＝Y２
③＝Y３

quantified.
In this section, by making the means of calculationon cost management to the evaluation function, the■Decision making model Ⅱ

It is judged by combination from ① to ③.
①②③(a) Y1＝０ Y２＝０(b) Y1＝０ Y２＝０(c) Y1＝０ Y２＝１

Y３＝０ ∴ Y1＋Y２＋ Y３＝０

∴０＋０＋０＝０

Y３＝１ ∴

Y1＋Y２＋ Y３＝１

∴０＋０＋１＝１

Y３＝０ ∴

Y1＋Y２＋ Y３＝１

∴０＋１＋０＝１

(d)

Y1＝１

Y２＝０

Y３＝０ ∴

Y1＋Y２＋ Y３＝１

∴１＋０＋０＝１

(e)
(f)
(g)

Y1＝０
Y1＝１
Y1＝１

Y２＝１
Y２＝１
Y２＝０

Y３＝１ ∴
Y３＝０ ∴
Y３＝１ ∴

Y1＋Y２＋ Y３＝２
Y1＋Y２＋ Y３＝２
Y1＋Y２＋ Y３＝２

∴０＋１＋１＝２∴１＋１＋０＝２∴１＋０＋１＝２

(h)

Y1＝１

Y２＝１

Y３＝１ ∴

Y1＋Y２＋ Y３＝３

∴１＋１＋１＝３

costs between the local government and the private
sector are compared. Input value of evaluation
functionandcalculating

formulaconcerning

evaluation function on cost management are as
follows.
Cost of administrative officer:

Moreover, from the decision making modelⅡ, it is

Employment cost Unit cost (Hourly rate＋Benefits

judged whether the administrative work corresponds

package etc): wi

to Rank1 or Rank2 by the result of the combination

Head-count (Pursuer): niconcerning the evaluation function, and as for theTime (Necessary engaging time): ti

judgment result, its result from (a) to (h) is set

Overheadpriorities in the order ③＜②＜①. By setting these

Quantity( Number of times :q): pq

priorities, from the administrative work which it is※I is different according to the official position or

possible to outsource easily, the cost is analyzed

the ordinance of local government.

according to the evaluation function of cost

(Example: From1=Secretary to 8 = Department

management (Table 5.3).

chief)

Table5.3 The result of combination concerning theCost of outsourcee:

decision making modelⅡ

Employment cost Unit cost (Hourly rate＋Benefits■Decision making model Ⅱ

The result of combination
① ② ③

(a)

Y1＝０ Y２＝０

Y３＝０ ∴

Y1＋Y２＋ Y３＝０

∴０＋０＋０＝０

(b)
(c)

Y1＝０

Y２＝０

Y３＝１ ∴ Y1＋Y２＋ Y３＝１

∴０＋０＋１＝１

Y1＝０

Y２＝１

Y３＝０ ∴ Y1＋Y２＋ Y３＝１

∴０＋１＋０＝１

(d)
(e)

Y1＝１
Y1＝０

Y２＝０
Y２＝１

Y３＝０ ∴ Y1＋Y２＋ Y３＝１
Y３＝１ ∴ Y1＋Y２＋ Y３＝２

∴１＋０＋０＝１∴０＋１＋１＝２

(f)
(g)

Y1＝１
Y1＝１

Y２＝１
Y２＝０

Y３＝０ ∴ Y1＋Y２＋ Y３＝２
Y３＝１ ∴ Y1＋Y２＋ Y３＝２

∴１＋１＋０＝２∴１＋０＋１＝２

(h)

Y1＝１

Y２＝１

Y３＝１ ∴ Y1＋Y２＋ Y３＝３

∴１＋１＋１＝３

Outsourcing is easy.

◆The cost analysis with the cost management sheet is added to the combination of these judgment
results, and outsourcing is done in order of the cost.

Amount

(Unit

cost:

p)

×

package etc): W
Head-count (Pursuer): N
Time (Necessary engaging time): T
Overheadcost

Amount

(Unit

cost:

p)

×

Quantity( Number of times :q): PQ

Outsourcing is difficult.
■Setting on weighted combination by the result of judgment from (a) to (h).
As the total result of these combination takes it to becoming 3→2→1→0, the outsourcing is moreeasier in the administration.
■The priority level of these weight is ③＜②＜①.
①：It makes external consigning ahead and the education and guidance are done in order to receive
an order.
②：To accomplish the administrative work, it educates and it guides external consigning ahead.
③：It is possible to correspond only by improving the administrative management system.

cost（W・N・T）＋PQ
f (x) =

８

Σ(wi・ni・ti)＋pq
i=1
And when this evaluation function is used in order tocompare the public sector with the private sector,
according to the condition of the following

5.3. The evaluation function concerning cost

evaluation functions (1) and (2) led from thismanagement

evaluation function, whether it corresponds to Rank
1 or Rank 2 is judged, and an external consignment

0500101-1-2: This work is judged as pattern α

is decided.
If f(x)=（W・N・T）＋PQ
８

due to be classified a fixed form work. Therefore,＞1, Rank1 （Core work）（1）

Σ(wi・ni・ti)＋pq
i=1

If f(x)=（W・N・T）＋PQ
８

this work is also only adopted by the decision
making modelⅠ.

≦1, Rank2 （Non Core work） （2）Σ(wi・ni・ti)＋pq

0500101-1-3: This work is judged as pattern β
due to be classified special work. Therefore, thisi=1

5.4. The countermeasure for which the judgment

work is adopted by both the decision making modelof character classification consists of irregular

ⅠandⅡ.

pattern

As the result, this administrative work 0500101-1 isconsisted of pattern α- patternα- patternβwhich

When the administrative work is accomplishedis called irregular pattern.

usually, the work flow which consists of the

Therefore, as it is impossible for this irregularadministrative work is often composed by a number

administrative work to be judged as a totally sameof different patterns. This system calls the casepattern, the irregular work like this is dealt withwhich is composed different work patterns “Irregularusing the decision making model of outsourcing

pattern” and the judgment method for using thewhich is capable of classifying into individual

decision making model of outsourcing and the costpattern. In other words, as for an irregular pattern,management sheet is as shown in following

the unit of outsourcing doesn’t need to be set the unit

Figure5.4of Level.Ⅱbut the unit of level.Ⅲ and it will think■Example) Case where pattern of the administrative work becomes
irregular.
From the administrative work pattern and its pattern matrix, when an
Administrative work on Level.Ⅱ is a work that works out with thefollowing below,
Decision making modelWork Level.Ⅲ (Flow of work)
Work Level.Ⅰ Work Level.Ⅱ
05000101-1-1 Administrative Work A-1◆0500000 General Affairs Division=α05000100 Section of General Affairs This is judged by decision making modelⅠ.
0500101-1 Administrative Work A 0500101-1-2 Administrative Work A-2
0500101-2 Administrative Work B=α0500101-3 Administrative Work C This is judged by decision making modelⅡ.
0500101-4 Administrative Work D 0500101-1-3 Administrative Work A-3=β0500101-5 Administrative Work E
This is judged by decision making modelⅠ＋Ⅱ

as it is judged that this administrative work pattern is consists of
α-α-β, this one is an irregular pattern.

about the cost management sheet in a similar way.
From now on, the number of general affairs which
are representative of the fixed work, for example “awork of payment”, “a work of documentation
management” and so on in the administrative work isdone in each section every day and their works don’t
only have to be reorganized as all one work but also
have to be checked up whether it is possible for themto outsource.

Figure5.4 Example of irregular work pattern

6. The process chart of outsourcing

For instance, if the administrative work 0500101-1

The process chart of outsourcing is a construction

which is located to Level.Ⅱstarts from 0500101-1-1

time schedule to settle on the plan to outsource theand completes 0500101-1-3, from the administrative

administrative work in a medium and longer term

work pattern and the pattern matrix, the criteria ofplan, for the administrative work which was judged

decision making model divides as follows.

to be able to outsource don’t have to keep

0500101-1-1: This work is judged as pattern αoutsourcing excessively and furthermore, it has todue to be classified a fixed form work. Therefore,

need to be relation with financial program. In thethis work is only adopted by the decision making

local governments, a variety of plans, for instance,

modelⅠ.

an integrated promotion plan, a city planning, a plan

（Head-count）

of health and welfare for the elderly, are settled in a 350
short or medium or longer term. In the case with

（Employment Cost：
Thousand Yen）

The number of staff

1,800,000
Employment Cost

1,600,000

300

1,400,000

thinking about outsource, making a process chart just 250
Work D

like such a kind of plan is absolutely imperative inorder to carry out outsourcing effectively.

200

1,200,000

Work C150

800,000

Work B
Work EWork G

600,000

100

6.1. Points of making the process chart

1,000,000

Work HWork FWork I

400,000

Work A50

200,000

0
H19

H20

H21

H22

H23

H24

H25

H26

H27

0
H28

Two points are shown as follows so as to make a（Year）

Figure6.1 Example the process chart of outsourcing

process chart.
First, the cost caused by outsourcing is necessary
not to become a double cost when it is compare with

When

the

local

government

outsourcethestaff’s labor cost etc. That is to say, the local

administrative work in premeditation, the point togovernment has not only to figure out the costwhich should be paid attention especially sets

adequately which caused by reducing employment

priorities on work which decided to outsource andcost but also decide to outsource the administrative

works out programs in order to outsource it in awork within the range of the reduction cost. This ismedium or longer term.

connected with the prevention of the fiscal
predicament. As it were, to deal with 2007 problem

7. The management cycle of outsourcingthat it will rush into in the age from which thebaby-boom generation retires in large quantities,

Finally, the new management cycle of local

staff’s decreasing tendency in organization, accurate

government will be proposed by carrying out

welfare expense of each staff, staff’s age structure

outsource the administrative work in premeditation.

and employment cost caused by being prompted

By carrying out outsource the administrative work

have to figure out.

in premeditation as well as using the decision

Secondary, to work the principle of the market withmaking model and the process chart , thewhere between needs of resident who requires publicmanagement

services and providing with public services accord,

specialized in an external consignment will bewhen the local government decides to outsource theestablished, which will be a circulative and spiraladministrative work, it is necessary to consider thetype (Figure7.1).

supply and demand between citizen and public
services.

cycle

of

outsourcing

which

is

■The management cycle of outsourcing
Plan→Do→Check→Action（PDCA）（Decision making）→（Consignment・Contract）→（Quality control）→（Evaluation・Improvement）

This management cycle is modified
and evolving by doing maintenance.

6.2. Making of a process chartP
A Management
Plan

By basing on the above-mentioned points, the local
government

has

to

make

the

process

term aspect when they actually outsource the

Systemmaintenance

Do

Cycle

D

C

P
Check
Management
A
Cycle D

chart

concerning outsourcing from a medium or longer
administrative work (Figure6.1).

ActionOMC

SystemmaintenanceVector of the
management cycle

P
A Management
Cycle DCC

Plan
（Decision making）

Do
ActionThe management cycle（Consignment/（Evaluation/of outsourcing
Contract）
Improvement）
Check（Quality control）■Magnified figure

the administration in acting the site because there is

Figure7.1 The management cycle of outsourcing

a necessity for immediately constructing the cost
Plan: Selection of the administrative work which ismanagement system in the local government actual.

outsourced and decision making→Do: Outsource theadministrative work (the consignment contract and9. EFERENCES

the consignee carries it out)→Check: Quality control
and evaluation of work that is outsourced→Action:
Improvementofoutsourcing

initself → The

National Institute of Population and Social Security
Research Web site, URL:

maintenance of total system→The following plan tohttp://www.ipss.go.jp/index.html (last date accessed:

be continued.

19 January 2007). (Website References)

The reason is that this management cycle forms the
spiral type is aiming at that the administrative work
which was outsourced is reviewed, modified andevaluated during the process which moves from
PDCA cycle to next PDCA cycle. Through the new
management cycle like this, it is thought that thequality of work which was outsourced as well as thissystem in itself will improve.
8. Conclusion and research in the future
In

this

writing,theconstruction

of

new

management system was tried by introducing thedecision making model and the evaluation functionin order to make a study on the modality of proper
outsourcing in the local government.
Now the financial picture in the local government isbeing thought serious every year and accountabilityof the administration is requested for the citizen andthe congress, the clarification of the division of theroles played by between the private sector and public
administration has been needed more and more andin addition, it is thought that the quality control ofwork to which was outsourced is demanded.
In the near future, the criterion not only isreexamined but also it will try to construct thecriterion of the quality control of administrative
service in the future. Moreover, this system is madeto be improved to a model near "Activity-based
costing" that appropriates the focus to "Activity" of