LA Metro contracted with InfraStrategies to perform a cost comparison of in-house and contracted services within the Operations Department. The purpose of this analysis is to support Metro in making informed decisions about the cost effectiveness of bringing a service in-house rather than contracting it out. The InfraStrategies team performed a peer and literature review, reviewed approximately a dozen contracts, and identified key decision points in order to develop a decision tree framework and model.

While this study focused on Metro Operations, the primary recommendation is to implement an assessment process for procurement decisions which is applicable to all major cost centers in the agency. This process is based on both qualitative and quantitative factors. Two tools were developed to support the decision process: a decision tree and a cost comparison model, which together will help Metro decision-makers determine whether a specific activity should be considered to be brought in-house or continue to be outsourced.