By Chris Furlong, Managing Director, Integra Housing Consultancy
Over the years, I’ve worked with organisations that would never consider outsourcing their repairs service and others that would never contemplate bringing one back in-house.
Both are convinced they are right.
And that’s precisely why the debate around Direct Labour Organisations (DLOs) continues to divide opinion across the housing sector.
Attend any repairs conference, speak to any group of housing professionals, or sit in on a board discussion about service delivery, and the conversation will inevitably arise.
“Should we have a DLO?”
It’s a question that has occupied housing providers for decades.
But I increasingly believe it’s the wrong question.
Because residents don’t care whether the operative fixing their boiler works for a contractor or a DLO.
They care whether they turn up on time.
They care whether the repair is completed properly.
They care whether their landlord keeps them informed.
Increasingly, the Regulator is interested in exactly the same things.
The real issue is not who delivers the service.
The real issue is whether the service delivers for residents.
Why DLOs Are Back in Fashion
Over the last decade, many landlords moved towards outsourced repairs models.
The reasons were understandable.
Contractors offered scale, specialist expertise and, in some cases, reduced management burden. In an environment where organisations were under pressure to reduce costs and improve efficiency, outsourcing often appeared an attractive solution.
But the landscape has changed.
Today, housing providers operate in a very different environment.
Consumer regulation has strengthened. Expectations around building safety have increased. Residents rightly expect more from their landlords. Boards are being challenged to demonstrate greater oversight and assurance over the services that matter most to customers.
In that environment, control matters.
Many organisations are now asking whether they have sufficient visibility over their repairs services, sufficient assurance over performance, and sufficient confidence that customer expectations are being met.
That is one of the reasons why DLOs have returned to the agenda.
The Benefits Are Real
There is a tendency in some parts of the sector to dismiss DLOs as expensive or outdated.
I think that overlooks some genuine advantages.
At their best, DLOs create a closer connection between the organisation and the services being delivered.
There is often greater alignment with organisational values, clearer accountability and stronger visibility of performance.
When a landlord directly employs its workforce, there is an opportunity to build a culture focused on customer outcomes rather than contractual outputs.
That matters.
Repairs operatives are often the face of the organisation. They spend more time in residents’ homes than many housing officers or managers ever will.
How those staff behave, communicate and deliver services has a huge impact on customer perception.
The best DLOs understand this.
They see repairs not simply as a maintenance function, but as a customer service function.
They recognise that every interaction with a resident is an opportunity to build trust and confidence.
DLOs can also provide valuable intelligence.
Operatives develop an understanding of properties, recurring issues and customer needs that can be difficult to replicate through more fragmented delivery models.
When organisations capture and use that information effectively, it can improve asset management, investment planning and service design.
But Let’s Not Pretend DLOs Are Easy
At the same time, I have seen organisations underestimate the challenge of running a successful DLO.
A DLO is not simply a repairs service.
It is effectively a business within a business.
Recruiting and retaining skilled tradespeople remains difficult. Productivity must be managed carefully. Vehicles, depots, materials and technology all need investment. Performance must be monitored rigorously.
Without strong leadership and operational discipline, costs can escalate quickly and performance can deteriorate just as quickly.
This is where many organisations run into difficulty.
The assumption that bringing services in-house automatically improves performance is no more valid than the assumption that outsourcing automatically improves efficiency.
Neither is true.
Success depends on capability.
The Most Successful Organisations Focus on Outcomes
One of the most interesting observations from recent years is that some of the highest-performing repairs services in the sector are delivered through DLOs.
Others are delivered through contractors.
Some are delivered through a combination of both.
The common factor is not the operating model.
The common factor is leadership.
Successful organisations are clear about what good performance looks like.
They use data effectively.
They listen to customers.
They hold people accountable.
They continually challenge themselves to improve.
In short, they focus on outcomes rather than structures.
That is where I believe the sector should focus its attention.
What Boards Should Really Be Asking
When discussions about DLOs take place at board level, I sometimes think the conversation starts in the wrong place.
Rather than asking:
“Should we have a DLO?”
Perhaps boards should be asking:
- Are residents receiving the level of service they deserve?
- Do we genuinely understand how our repairs service is performing?
- Can we demonstrate value for money?
- Are we confident in our compliance and assurance arrangements?
- Do we have the capability to manage whichever model we choose?
Those questions are far more important.
Because ultimately, a poorly managed DLO and a poorly managed contract will produce exactly the same outcome:
Poor services for residents.
The Future Is Unlikely to Be Binary
I also suspect that the future will not be defined by a simple choice between in-house and outsourced delivery.
Many organisations are already moving towards hybrid models.
Core services may be delivered through a DLO, while specialist works are outsourced.
Some landlords are retaining strategic control while using contractors to provide flexibility and capacity.
Others are bringing specific services back in-house while maintaining external partnerships.
These approaches reflect a growing recognition that there is no universal solution.
Different organisations face different challenges, operate in different markets and serve different communities.
The right answer will not be the same for everyone.
My View
Having worked with repairs services across different organisations, I have become increasingly convinced that the DLO debate is often a distraction.
The question is not whether DLOs are good or bad.
The question is whether they are well led, well managed and focused on delivering excellent outcomes for residents.
The same is true of outsourced contracts.
In today’s environment, residents expect safe homes, responsive services and clear communication.
Regulators expect assurance, accountability and performance.
Boards expect value for money.
Those expectations do not change because of the operating model.
Which is why the organisations that succeed will be those that spend less time debating structures and more time focusing on service quality, customer experience and operational excellence.
Because ultimately, residents do not judge landlords on their delivery model.
They judge them on the service they receive.
Five Key Takeaways for Boards and Executive Teams
- The operating model is less important than the outcomes it delivers.
- DLOs can offer significant benefits, but only when supported by strong leadership and operational discipline.
- Outsourcing does not remove accountability for service performance.
- Customer experience, compliance and value for money should drive decision-making.
- The most successful organisations focus on performance, not ideology.
How Integra Housing Consultancy Can Support
At Integra Housing Consultancy, we support housing associations and local authorities to review, strengthen and transform repairs and maintenance services.
Whether services are delivered through a DLO, outsourced arrangements or a hybrid model, our focus is helping organisations improve performance, strengthen assurance and deliver better outcomes for residents.
Because when it comes to repairs services, the question is not who delivers them.
The question is how well they are delivered.
