Bolsover DC, Chesterfield BC and North East Derbyshire DC Board/20070320/Ag… · V1.1 Updated with...
Transcript of Bolsover DC, Chesterfield BC and North East Derbyshire DC Board/20070320/Ag… · V1.1 Updated with...
Bolsover DC, Chesterfield BC and North East Derbyshire DC
Corporate Services Options Appraisal
Release: FINAL
Date: 24th January 2007
Author: Vicky Pollitt
Owner: Mark Evans
Corporate Services
Options Appraisal
Contents
1 Management Summary .................................................................................................. 4
1.1 Overview................................................................................................................. 4
1.2 Corporate Services .................................................................................................. 4
1.3 Recommended Option............................................................................................. 4
2 Introduction.................................................................................................................... 6
2.1 Purpose of the review.............................................................................................. 6
2.2 Layout of Document ............................................................................................... 6
2.3 Context for the review............................................................................................. 7
3 Approach...................................................................................................................... 10
4 What are the Councils looking to achieve?.................................................................. 12
4.1 What are the ambitions of each authority?............................................................ 12
4.2 What are the principles for collaboration?............................................................ 12
5 How can we deliver the Councils’ Vision?.................................................................. 13
5.1 Governance arrangements..................................................................................... 13
5.2 Long list of ‘service delivery’ options .................................................................. 15
5.3 Short list of options ............................................................................................... 16
5.4 Summary of the options available......................................................................... 28
6 Assessment of Options................................................................................................. 29
6.1 Assessment criteria ............................................................................................... 29
6.2 Options Appraisal ................................................................................................. 29
7 Recommendation and conclusions............................................................................... 33
8 Appendices: Detailed Services Assessment................................................................. 34
8.1 Service Evaluation ................................................................................................ 34
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Document Control
Control Details
Document
Location:
Production
Software:
Microsoft Word 7
Author: Vicky Pollitt
Document Amendment Record
Issue Amendment Detail Author Date Approved
V0.1 Original draft V Pollitt 15/8/2006 AT
V1.0 Draft for comments A Thomson 19/12/2006 JN
V1.1 Updated with comments from Mark Evans V Pollitt 10/01/2007 AT
V1.2 Updated with comments from CEO Group V Pollitt 24/01.2007 AT
V1.3 Updated with comments from David Shaw V Pollitt 26/01/07 AT
V1.4 Final Draft V Pollitt 29/01/07 AT
Document Sign-off
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1 Management Summary
1.1 Overview
This review was commissioned by Chesterfield Borough Councils, North East Derbyshire and
Bolsover District Councils to identify the options for alternative service delivery of corporate
services as a partnership, and provide a final recommendation as to which option was most
likely to be successful.
1.2 Corporate Services
The services identified as being of a corporate nature across the three authorities were:
• Finance;
• Revenues and Benefits;
• ICT;
• Human Resources;
• Legal Services;
• Property Services;
• Customer Services;
• Commercial and Development;
• Communications
It was agreed that for the purposes of this review, those service (or parts of services) that
were of a strategic or policy setting nature and those which were unsuitable due to their very
nature (democratic services, mayoral office), would remain the sole responsibility of each
authority and were therefore excluded from the remainder of the review.
1.3 Recommended Option
Through a structured analysis of current local authority service delivery accompanied with
consultation with chief executives, directors and heads of service from each authority, the
scenario options were shortlisted:
• The creation of a single shared services unit supporting all three authorities. This unit
will be characterised by a single process for each service, a single management and
team structure for staff, ideally colocated (the feasibility of suitable property for shared
location has not been included within this review). This unit would be funded through a
pooled budget and set independent performance targets.
• The shared service unit has the option to involve the private sector in the following
ways:
o Large scale involvement of private sector through a long term strategic
partnership
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o Incremental involvement of private sector in delivery of specific service areas
as identified on a business case basis
o No private sector involvement
• Also, in order to provide the appropriate governance for the shared service unit, the
authorities had the following governance options:
o Governance by committee / board structure underpinned by legal
memorandums
o Governance through an independently created Joint Venture Vehicle with each
authority having an equal share of the Venture.
The following criteria were then applied to the options above to identify the most
arrangement for the delivery of the shared services unit.
Criteria Relative Weighting
Opportunity to reduce operational costs 5
Opportunity to improve customer experience 4
Opportunity to improve staff development 3
Opportunity to generate capital investment 3
Ease of Implementation 1
It was recommended that due to the lack of strategic congruence within the partnership to the
acceptability of long term large scale strategic partnership, it was recommended that the option
most likely to succeed in delivering corporate services in an alternative manner was:
• The creation of a shared services unit supporting all three authorities, characterised by
a single process for each service, a single management and team structure for staff,
ideally operating from a single location. This unit would be funded through a pooled
budget and set independent performance targets. Where it is identified as beneficial
through a business case, the private sector should be engaged to partner the unit in the
delivery of individual services.
• It is also recommended that this shared service unit is governed through the existing
shared working board arrangement with additional legal support to clarify the new
arrangements.
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2 Introduction
2.1 Purpose of the review
This review was commissioned through the East Midlands Centre of Excellence to appraise
the options available to Chesterfield Borough Council, North East Derbyshire District Council,
and Bolsover District Council to improve the delivery of Corporate Services through closer
collaboration.
The study was undertaken to help the three authorities:
• Develop a set of principles and objectives to be achieved from closer collaboration in
the area of Corporate Services;
• Agree a common set of services which define Corporate Services;
• Understand the long list of ‘delivery options’ for collaborative working;
• Develop a short list of ‘delivery options’ which are most likely to deliver the principles
and objectives as agreed, and indication of risk against each option;
• Agree a set of appraisal criteria and critically assess each option in order to identify the
preferred option for likely success;
• Provide an analysis of where the models have been applied in other local and regional
government scenarios and the benefits derived
We were not required to develop detailed financial costings or estimates of potential
savings.
2.2 Layout of Document
• Executive Summary;
• Introduction;
• Approach Undertaken;
• What are the Councils looking to achieve?;
• How can the Councils deliver the vision?;
• Assessment of options;
• Recommendation and conclusions;
• Appendices;
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2.3 Context for the review
2.3.1 Local Context
The three Councils occupy the northern geography of the Derbyshire sub region formed of
eight districts, the City and the County councils. They are a mixture of rural and urban areas,
with Chesterfield being the second largest town in the county.
Chesterfield BC Town Hall and North East Derbyshire Civic Centre are located within a short
distance of each other. Bolsover District Council has ward boundaries adjacent to both North
East and Chesterfield, with their Council Offices located around 6 miles from the other two
authorities.
Through this geographical proximity and desire to improve services, the Councils have a
history of joint working and this is one of a series of projects currently being undertaken.
Although politically there are differences between the authorities there appears to be a genuine
appetite for co-operation and collaboration.
In the context of this report the services currently delivered by the three authorities under the
title, ‘Corporate Services’ are:
• Finance;
• Revenues and Benefits;
• ICT;
• Human Resources;
• Legal Services;
• Democratic Services;
• Property Services;
• Mayoral Office;
• Customer Services;
• Policy, Performance, Strategy;
• Commercial and Development;
• Communications
2.3.2 National Context
Closer working and collaboration across Local Authorities and within the wider Public Sector
has been part of the Government agenda. The National Audit Office (NAO) in 2005 indicated
that there is significant scope to achieve efficiency savings through closer working, where front
and / or back office services are shared jointly across Local Authority departments or between
differing statutory agencies.
The general underpinnings of this agenda include: -
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• Satisfying increasing customer demands – overall need for greater effectiveness in the
delivery of public services in order to meet increasing customer demand;
• Achieving Value For Money (VFM) – increased pressure to meet externally set targets
and assessments required to demonstrate VFM in the use of tax payers money;
• Learning lessons from the private sector – the private sector has demonstrated through
the use of enterprise wide technology and appetite to realise efficiencies that shared
services, where appropriate, can deliver cost and operational improvements;
• Releasing scarce resource – principle of releasing cashable and non cashable resources
to be redirected form Back Office functions to Front Office services requires a
challenging view of service delivery
2.3.3 What does ‘collaborative working’ mean in this context?
In this context, collaborative working is recognised as a model whereby authorities come
together to improve service delivery (both front and/or back office) in a combined or
collaborative manner. This may involve sharing knowledge, staff, resources and skills with
other organisations, irrespective of whether the delivery model involves the public or private
sectors.
The principle of collaborative working is about optimising people and their skills, assets, time,
business processes and other resources in order to drive efficiencies. A collaborative
arrangement, regardless of the governance model under which it operates, can in theory handle
any business function effectively, as long as there is competent management to realise the
benefits from the arrangement and performance criteria that meets the needs of the ‘governing’
councils.
Within this arrangement, the functions are concentrated either geographically or virtually
through enabling technology and common governance arrangements. Any collaboration will
require funding through a pooled budget with all the partners or agreed recharging
mechanisms, and be accountable to its ‘governing’ councils, to which it would report on the
performance and outcomes achieved.
2.3.4 Characteristics of services appropriate for shared delivery
Typically, the services best suited to collaborative working and shared delivery:
• Are those which are common to all members of the partnership (it is possible to
provide services which are only pertinent to one or two authorities, however this would
need to be agreed through the governance structure as it will have an impact on the
resources required to deliver services, and if appropriate would have to be robustly
reflected and effectively managed in any contractual arrangements where a third parties
are involved);
• Have similar levels of activity across each authority
• Have a high volume of activity;
• Have a low level of complexity;
• Are transactional (e.g. rules based, standardised and repetitive);
• Are common / standard activities applicable to multiple businesses;
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• Are non strategic / policy setting;
• Are easy to separate out with minimal impact on other processes;
• Provide opportunity for performance improvement;
Therefore, services less appropriate for collaboration or shared delivery display the opposite
characteristics, e.g. low volume, highly complex, judgment based, derived from non standard
activities, are strategic or policy setting in nature, have little opportunity for performance
improvement, or have unequal levels of activity across each authority
2.3.5 Maturing Markets
Collaborative working and shared service delivery can involve a range of private sector
partners, the extent of which will be dictated by the strategy of the participating authorities. The
market for private sector delivery of local authority services is one that can be categorised as
‘maturing’ and in some areas as ‘mature’. A number of significant suppliers are active in this
market and are already operating a number of partnerships with individual authorities and also
with groups of authorities collaborating together.
This maturing of the relationship between the private sector and the public is reflected through
the move away from the private sector operating as a replacement for service delivery (or
outsourcing model) to one which is characterised as a strategic, or transformational,
partnership. This strategic partnership often reflects a greater participation of the private sector
to engage in more flexible contracting arrangements recognising risk/reward sharing, skills
transfer and capacity building within the public sector, alongside a greater understanding of the
challenges and pressures facing local authorities.
This has resulted in a move away from the historic confrontational contracting that
characterised early private sector involvement in public sector delivery, to a more collaborative
longer term partnership based upon greater mutual collaboration.
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3 Approach
The approach undertaken when carrying out the review is as set down in the Project Initiation
Document and summarised below:
Project Start Up
Vision
Service
Identification
Assessment of
Options
Recommendation
of Preferred Option
Output: Project Initiation Document
(PID)
Questions: What will the end state look
like?
What do we want to achieve
corporately?
What form may this vision
take?
How will the Councils be
different from now?
Questions: Which services from each Council provide
the best fit with the agreed vision?
How will differing services affect the
vision?
Questions: What are the criteria for assessment and
their individual weightings?
Outputs: Application of above to identify preferred
option(s)
Report and
PresentationOutputs: Production of final report and presentation of
findings
3.1.1 Consultation
Throughout this project a consultative approach was taken to define the parameters of the
project. As well as achieving consensus through workshops, consultation with staff members at
all levels (including Union Officials) was undertaken, and a collaborative e-Room was
provided for dissemination of information. All authorities were engaged at each stage in order
that balanced decisions were facilitated and achieved.
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3.1.2 Visioning and Service Identification phases
Meetings were held with each Chief Executive to contextualise the project and understand the
priorities for each authority. Following these meetings a Visioning workshop was held on 29th
June 2006 with members of Senior Management Teams and key members of staff. This
workshop formalised the priorities for the project, and began to define the scope of the services
defined as ‘Corporate’.
Following the workshops the services within scope were rationalised in terms of suitability
(based upon criteria such as volume, complexity etc) for a collaborative corporate services
function. Further details of the individual services (ICT systems used, potential barriers,
impending legislative changes affecting the service etc.) were obtained through an extensive
range of interviews with the Head of Service, or with a key member of staff. The result of this
generated a shortlist of corporate services with the best fit for collaborative working that was
agreed through workshop-based discussion.
3.1.3 Delivery Option Assessment, Risk Assessment and, Option
Recommendation phases
Workshops were held on the 11th September 2006 for Chesterfield BC and Bolsover DC, and
repeated on the 1st November 2006 for North East Derbyshire DC, involving the Chief
Executives and Senior Management, where the long list of service delivery options for
collaboration were presented and discussed. A consensus was achieved through discussion that
a number of options were less suited to delivering the aims and objectives, and were therefore
excluded from the remainder of the review. The subsequent shortlist of options were agreed and
taken forward for appraisal.
A final workshop was then facilitated whereby, through independent voting technology each
authority articulated their weightings for each appraisal criteria, and then scored each criterion
against the short list of options for collaborative working.
The analysis the outcomes and evaluations from the workshops where considered alongside
wider Deloitte market analysis formed the basis of the recommendations.
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4 What are the Councils looking to achieve?
4.1 What are the ambitions of each authority?
The primary question to be addressed in order to maximise the likelihood of success in
achieving greater collaboration in the delivery of Corporate Services is - what does each
authority want to achieve from the exercise and are any of those ambitions mutually exclusive?
Following discussions with the Chief Executive and Senior Management from each Authority,
the main areas of priority can be summarised as:
Chesterfield BC Achieve cashable efficiencies
Upfront inward capital investment, especially in
areas of Customer Access
Bolsover DC In tune with efficiency agenda (improving
services not just cutting costs)
Emphasis on improving customer experience
North East Derbyshire DC Improvement in quality of services delivered
Efficiencies reinvested to continue service
improvement
In addition, to the above, within the context of closer collaboration, it was agreed through
consensus with senior staff and Chief Executives at the Visioning workshop that the following
were the ambitions for any alternative service delivery:
Improved service delivery; improved staff opportunities and knowledge building/ transfer;
robustness of delivery; efficiency gains/ savings; inward investment.
(Please note at this stage the relative importance of each of these objectives to the partnership
was not defined.)
4.2 What are the principles for collaboration?
The following principles defining the premise of any collaborative working were also
agreed at the Visioning workshop:
• The implementation should be carried out at the same speed across all authorities,
creating a robust functioning three-way partnership;
• A Programme Board approach to governance is preferable;
• Adequate provision for agreements around policy change must be made.
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5 How can we deliver the Councils’ Vision?
The next stage of the review examined the range of options available to the partnership for
closer collaboration that would deliver the ambitions of the authorities, taking into
consideration governance arrangements and service delivery.
5.1 Governance arrangements
Any collaboration by the three authorities in the delivery of services will require appropriate
governance arrangements to be put in place.
The governance options for consideration are:
• governance by committee / board;
• governance through a Joint Venture Vehicle
Each is discussed further below.
5.1.1 Governance by Joint Committee / Board
One option for governance is through a committee, or board arrangement involving members
and officers from each authority.
If the authorities at any point wished to procure services from the private sector as a
partnership, one authority would be required to lead this procurement, as the joint committee is
not a legal entity in its own right and therefore cannot contract in its own right. In this case risk
management policy would have to be robust enough to facilitate effective supplier and contract
management, and would also need to ensure the risk of such a relationship was equitably shared
amongst the partners.
Governance by board is already being successfully applied across the partnership, in particular
through the shared audit functions.
The advantages of governance through a committee / board arrangement are as follows:
• Public partnership;
• Single arrangement for delivery of services;
• Partners do not take on additional responsibilities / legal duties;
• Procedures well established in Local Government law;
• Governance by Board already in operation across the three authorities
The disadvantages however are:
• Joint committee / board is not a separate corporate entity and therefore cannot contract
in its own right;
• Risk transfer;
• Potential for political sensitivities between partners;
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• Potentially slow to react and make decisions;
• There is an increased likelihood of management and staff being intrinsically linked to
the working practices of their original authority and therefore become restricted in
applying innovation and challenge to service delivery;
• Not legally possible to act as a trading unit to other public bodies on an income
generating basis.
5.1.2 Governance by Joint Venture Vehicle
This model represents a scenario where the three authorities create a separate legal entity
through a Joint Venture Vehicle (JVV) with the specific purpose of delivering corporate
services back to all three authorities. Each authority would have an equitable distribution of
governance rights (including risk sharing), which would also enshrine redistribution of any
income generated if the JVV provided services to others on a fee-generating basis.
Resources would be owned by the company, and staff transferred through TUPE arrangements
to be employed by the JVV.
Any procurement from the private sector, either for goods or services, required for the delivery
of services would be undertaken by the JVV, as opposed to a lead authority through the
committee arrangement.
However, depending upon the nature and value of the services to be provided by the JVV back
to the authorities, the appointment of the JVV itself may be subject to EU procurement law.
Therefore, two procurement exercises may be required, one for the procurement of the JVV as
the procurement (or delivery) vehicle for the partners and one for the supply of services by any
private sector provider if required. Legal advice should be sought in this area by the
partnership.
In summary, the advantages of shared services managed through a JVV arrangement are as
follows:
• Distinct legal entity;
• Tailored solution;
• Sustainability;
• Risk sharing;
• Clarity of accountability;
• New body avoids history of departmental practices
The disadvantages however are:
• May have to procure JVV in open competition under EU procurement regulations;
• Political sensitivities of local authorities in involvement of a JVV;
• Takes time to set up;
• Ongoing arrangements to be managed and financed, including company filing requirements
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5.2 Long list of ‘service delivery’ options
The long list of service delivery options available to the partnership are presented below across
six broad areas of collaboration along a spectrum of alternatives moving from left to right as
the degree of collaboration and organisational change increases:
• No Collaboration – Each authority achieves their strategic ambitions through
pursuance of their own ‘improvement programme’ projects with no collaboration as a
partnership;
• Advisory Role – non-binding agreement across all three authorities to work closer
together to provide knowledge sharing and operational advice in the area of corporate
services. Service Delivery remains the responsibility of each authority;
• Single Service Agency – The delivery of individual corporate services is provided on
behalf of all authorities by the Authority which is the ‘best placed’ to provide that
service. In effect, each authority acts as a service delivery agent on behalf of the others.
A matrix of corporate service delivery will result;
• All Service Agency – All corporate services are provided by one Lead Authority on
behalf of the other Authorities. In effect, one authority will be the sole agent for all
corporate service delivery across the partnership;
• Autonomous Shared Services unit – Corporate Services are delivered through an
autonomous delivery unit, with a single process for service delivery replacing the three
authority processes under a single management structure. This model would require the
creation of a single delivery unit for corporate services and the amalgamation of staff,
resources and budgets to deliver the services. This would also require process re-
engineering exercise to ensure there is a harmonisation of processes. This unit would
be set performance and budgetary targets to reach, which would be monitored through
the governance structure discussed above. Services can be delivered through a range of
options:
o Public partnership: The shared services unit is created and resourced from
within the partnership;
o Mixed public and private sector delivery: The private sector is engaged to
deliver specific services (identified on a business case by business case basis)
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on behalf of the partnership, with the remaining services delivered within the
partnership;
o Private sector service delivery: All corporate services are delivered through a
private sector partner under a large-scale partnership arrangement.
5.3 Short list of options
The above long list of options were then analysed to identify a shortlist, which were most likely
to fit within the agreed ambitions and principles for partnership.
The following delivery model options were agreed through workshop discussions on 11th
September and 1st November as less appropriate in terms of the partnership and have therefore
been excluded from more detailed consideration:
• Collaborative Advisory Facilitation;
• Single authority providing individual services on behalf of others;
• Single authority providing all services on behalf of others;
It was felt that these models did not provide an adequate opportunity to achieve significant
change, nor would the agency arrangement be politically acceptable as this could be interpreted
as some form of delegation of responsibility to another authority, which is contrary to the
intentions of the review.
The shortlist of delivery models for detailed consideration is therefore:
• Autonomous Shared Services unit governed by either committee / board structure or
JVV with services delivered through either:
o Delivery Option 1: Large scale strategic partnership with the private sector
(100% private sector delivery of services);
o Delivery Option 2: Public, public, public partnership (100% council delivery)
o Delivery Option 3: Mixed public and private sector (private sector involvement
on a service by service basis);
The potential benefits to be derived from an autonomous shared service unit are summarised
below:
• Perceived independence of management;
• The opportunity to reorganise services around the customer and rethink or redesign the
way that councils do business;
• Reduced cost – management overheads, ICT, process re-design;
• Shared skills across all authorities;
• Greater resilience from a wider base and more staff with key skills or the specific
services;
• Increased efficiencies from standardised processes and technologies;
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• Economies of scale;
• Common ICT and shared platforms;
• Shared training and development opportunities for staff;
• Improved commercial bargaining power for any subsequent procurement from the
private sector; and
• A foundation for trading or expansion to other councils.
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5.3.1 Delivery option 1: Large scale strategic service delivery partnership
This option would involve the authorities engaging with a single private sector partner in the
large scale delivery of all appropriate corporate services at one time. This would represent the
most significant degree of change, both operationally and culturally.
The most common arrangement for partnership with the private sector is for strategic elements
of corporate services to remain within the remit of the Council, with a large scale transfer of
transactional services to private sector provider, with required staff either transferred across
under TUPE arrangements, or on a secondment basis.
This model requires a strong contracts management team on behalf of the client (either the JVV
or the lead authority under committee arrangements) and performance management clearly
defined and linked to payments.
The last few years have seen a movement away from the traditional outsourcing relationships
based on merely the provision of services, towards strategic partnerships where both parties
work together to achieve common aims. In order for this type of relationship to prosper it is
vital that the authority manages the supplier relationship effectively, devoting dedicated
resource to contract and performance management in order to minimise the risk of such an
arrangement, whilst maximising the value.
5.3.1.1 Which corporate services would be the best fit for large scale strategic service
delivery partnership?
Due to the premise that the commercial business case for the private sector is based upon
creating efficiencies by process redesign and economies of scale, the larger the number of
services included within the contract, the more attractive the proposition for the private sector
and therefore the better the contract to be negotiated with the partnership.
Therefore basket of corporate services for consideration within this option are:
• Finance;
• Revenues and Benefits;
• ICT;
• Human Resources;
• Legal Services;
• Property Services;
• Customer Services;
• Commercial and Development;
• Communications
5.3.1.2 What would this option mean for the three Authorities?
Depending on the arrangement agreed contractually, and the internal controls in place within
the authorities a large scale strategic delivery partnership with the private sector could lead to a
variety of advantages for the partner authorities, such as:
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• Inward capital investment;
• Skills transfer;
• Capacity building;
• Innovation;
• Transfer of operation risk of delivering efficiencies
However, this style of partnership is based on commitment from all parties to a long term
agreement (usually around 8-12 years). Although there is much evidence to suggest that
efficiency gains and process improvements are achieved in the short/ medium term, there is less
evidence to support long term success. Success is predicated upon political and operational
support, not simply to a strong business case in the short term, but also to working closely and
to building a robust yet dynamic supplier relationship with the delivery partners, facilitating
flexibility and developing the relationship to build on initial achievements.
In effect implementing such partnerships requires substantial cultural change – both
operationally by, for example, developing strong contract and supplier management capability;
building mature upward and downward communication networks to facilitate speed of issue
resolution – and strategically, sacrificing, to some extent, control of service delivery; working
in collaboration, not only with public sector partners but also with the private sector, which will
require acceptance and support of different cultures and objectives.
Furthermore by implementing a strategic delivery partner relationship collaboratively, the
complexity involved is amplified. There must be strategic congruence between all partners, as
without this successful delivery risks being negated due to a lack of common objectives and
divergent needs. There must be a clear and agreed definition of what the partnership wants to
achieve, in other words what ‘success’ would mean both mutually and individually, coupled
with an appetite for change which is strong enough to enable the culture shift needed to make
such an arrangement work.
In the case of Chesterfield, North East Derbyshire, and Bolsover such harmonious aims do not
appear to exist in this area of corporate services, moreover the appetite for cultural change
within the individual authorities does not appear to be equally strong. With such a divergence
in positions it would be highly difficult to implement a large scale delivery partnership which
would generate equal success for all parties.
5.3.1.3 Examples of application of this model elsewhere
The information stated is not verified, taken in good faith only and is in no way endorsed by
Deloitte
Authority Partner Services
Sheffield City Council Liberata ICT; Revenues and Benefits;
Exchequer Services inc.
Payroll, Sundry Debtors,
Creditors; Customer Services
inc. Contact Centre and
Reception Points
Blackburn with Darwin
Borough Council
Capita Revenues and Benefits;
Finance Administration;
Highways; Property Services;
Human Resources; Payroll;
ICT
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Linconshire County
Council
HBS Finance; Human Resources;
Property Services; ICT;
Catering
Mendip District Council Capita Revenues and Benefits;
Finance and Accounting;
Payroll; Elections
Management; ICT
Thurrock Council Vertex ICT; Revenues and Benefits;
Customer Services; Property
Rationalisation Strategy;
Human Resources
Rochdale Borough Council Agilisys & Mouchel
Parkman
Customer Services;
Highways and Engineering;
Payroll; ICT; Property
Management; Regeneration
Strategy
Middlesbrough Council HBS Revenues and Benefits;
Customer Services; Human
Resources; ICT; Property
Management
London Borough of
Bromley
Liberata Revenues and Benefits;
Payroll; Pensions
Administration; ICT Services
(Source Liberata website; HBS website; Agilisys website; Capita website; SOLACE;
Blackburn with Darwen website)
Detailed Case Studies:
The benefits and information stated below are not verified, taken in good faith only, and are in
no way endorsed by Deloitte.
Pendle Borough Council
In 2005 Pendle Borough Council outsourced the majority of their Corporate Services to
Liberata, with 150 employees transferring via TUPE to the provider.
Services outsourced were: ICT; HR and Payroll; Property Services; Revenues and Benefits; and
Customer Services. In 2006 this partnership was awarded Beacon status as an outstanding
example of Public Private Partnerships.
The contract implemented was for 15 years and is managed through Pendle’s internal
procurement team. The contract contains service targets developed from the authority’s own
delivery plan.
This arrangement to date has enabled the authority to cut costs by almost 10% and has also
enabled regeneration of the town centre, with their partner constructing a 50,000 sq ft new
business centre, and creating 300 new jobs within the area.
Whilst we are unable to comment on the costs associated with this partnership, the authority
has indicated significant benefit associated with this implementation.
As this partnership develops the potential for collaboration with other local authorities is high,
and the expansion of the arrangement likely to follow a similar route to the Barrow in Furness
partnership, which has been incremental and focused on specific activities (Revenues and
Benefits in particular). (Source Liberata and Pendle DC)
Corporate Services
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21
5.3.2 Delivery option 2: Public partnership service delivery
This would involve the three authorities creating a semi autonomous shared services unit that is
managed and delivered as a partnership, with no private sector involvement.
5.3.2.1 Which corporate services would be the best fit for three-way public partnership
shared delivery?
Whilst the ‘basket’ of corporate services under consideration are clear when a large scale
private sector delivery partnership option is pursued – all corporate services which are regarded
as non strategic, the services to be included within a three way public partnership delivery unit
are less clear.
It is necessary to reduce the long list of corporate services, stated in paragraph 2.3.1, to a short
list of target services that display the characteristics of services most likelihood to generate the
required efficiencies. Furthermore the assumption has been made that all services considered
for the short list should be of equivalent volume and consume equivalent resources, in order to
facilitate corresponding benefit and requirements equally across the partnership. Implementing
services with unequal levels of activity across the councils will restrict the efficacy of the
partnership as each authority will have an unequal interest in the services administered.
Therefore in the short to medium term the authorities should look to incorporate services of
equivalent volume and resource need. Through consultation with Chief Executives, Heads of
Service, and key members of staff via workshops and analysing each service in terms of this
assumption, and the shared service criteria, the following key corporate services show the
greatest potential to be delivered jointly:
• Revenues and Benefits;
• Customer Services;
• Finance;
• ICT;
• Human Resources;
• Legal Services
Each of these service areas were then analysed through data gathering and interviews with key
personnel to identify any subsequent factors, which may impact upon their suitability for
incorporation within a shared service unit. The factors considered were:
• Systems – which primary systems are used for the delivery of the service;
• Current Levels of Collaboration – what, if any, collaboration is in place currently, and
whether this collaboration is formalised or not;
• Process Complexity – how bespoke the process are to the individual authorities, and the
level of specialisation associated with undertaking the service;
• Barriers to Collaborative Working – barriers include awaited or recently implemented
legislation; non-comparative resourcing; political pressure for non-inclusion;
• Drivers for Collaborative Working – drivers include need for investment; large appetite
within each authority; political pressure for inclusion; comparative resourcing models;
Where all three authorities use the same IT systems, are currently already involved in
formalised collaboration, process complexity is relatively low, transaction volumes are high,
barriers low and drivers high they were seen as highly suitable for inclusion in a shared services
arrangement. Similarly where these ratings did not apply or were only applicable to some
Corporate Services
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22
degree a lesser rating was applied. The detailed results of this analysis can be found in
Appendix 1.
5.3.2.2 Implementing a three-way public partnership
There are certain decisions which would have to be made in order to minimise the risk, and
maximise the value associated with such a change. In simplistic terms there are two ways to
implement this option:
• Big Bang – all appropriate services are implemented within the delivery vehicle in one
phase. This option means that change is implemented relatively quickly, and major
results or benefits from this change are also realised relatively quickly. Conversely,
however this approach may also prolong some benefit realisation as ‘quick wins’
would be included with the main implementation and would not be actionned in the
short term. For this to be successful there must be a large appetite for change across the
individual authorities along side robust programme and change management processes.
The risk profile of such a change is high and this can lead to staff unrest as well as
potential initial delivery problems multiplied across all included services.
• Phased Delivery – appropriate services are implemented within the unit on a phased
basis. This option spreads the risk of implementation across a whole programme of
deliveries, and allows the organisation to adjust to the change over time rather than
necessitating an immediate revolution in process, culture etc… This however would
also require strong programme management in order to ensure that the impetus for
implementing individual projects is maintained and that the transformation keeps to
schedule, avoiding unnecessary management of change issues.
Although not risk averse, in terms of risk appetite the three authorities are seen to be moderate.
Moreover the lack of project and change management expertise available internally would
restrict the perceived ability to implement using a ‘big bang’ approach. A phased approach to
implementation is therefore recommended in this instance. The recommended phasing of
services is outlined below.
5.3.2.3 Phase One Services
Phase one is made up of Revenues and Benefits and Customer Services. This also includes
supporting ICT, These services have been chosen as they provide areas of multiple process
transactions, but also high volumes of activity thus indicating healthy opportunities for
collaboration within corporate services.
To include these services within a shared services unit would require substantial process re-
engineering, however both services offer reduced complexity for integration through having
similar systems and in the case of Customer Services advanced collaboration with North East
Derbyshire and Chesterfield.
CORE 1 Phase 1
Revenues and Benefits
Customer Services
ICT
Corporate Services
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5.3.2.4 Phase Two Services
Phase two is made up of the services that provide less immediate opportunities for
collaboration in terms of volume and process complexity, and may also hold some barriers to
inclusion such as imminent legislation, or requirements for substantial process re-engineering
and system integration. However these barriers are balanced by reasonable appetite for
inclusion and in most cases some already established collaboration.
The services suggested for this phase are: The remaining ICT functions – Helpdesk and
Disaster recovery management; Human Resources services – Training co-ordination,
Recruitment administration, Health and Safety and Equalities; Finance – Payroll and Insurance
services; and Legal Services – Land Charges.
This phase of integration should take place after Core 1 and will further establish the co-
operative practices between the authorities.
5.3.2.5 Additional Service Considerations
Phase 2
Human Resources
Finance
ICT
Legal
Phase 1
Revenues and Benefits
Customer Services
ICT
ADVISORY ADVISORY
Project Management; Knowledge Management;
Legislation Guidance
Phase 2
Human Resources
Finance
ICT
Legal
Phase 1
Revenues and Benefits
Customer Services
ICT
Corporate Services
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24
The ‘advisory’ element is devised from a selection of services where collaboration could be
provided on an ad hoc basis. These should enable further economies of scale through reduced
need for the individual authorities to resource the services, furthermore they should facilitate
improved efficiency and effectiveness across all departments through better knowledge sharing,
and access to specialised capability.
This phase of services could be implemented at any point in the development of the corporate
services unit.
5.3.2.6 What would this mean for the three Authorities?
A public/ public/ public partnership would provide the opportunity to achieve collaboration
between the partners, without the associated contractual, reputational and implementation risks
associated with a large scale strategic delivery partner relationship. It is an option that, although
requires a certain amount of culture change, there is not the necessary paradigm shift in
strategic and operation ethos that involving the private sector in significant delivery alliances.
Through this delivery option the three councils would be able to achieve efficiencies, via
knowledge transfer, development of effective processes, and reduction in duplicated effort by
effective use of resources. All efficiencies gained would be retained by the individual
authorities – where as with private sector partners these would be achieved and kept by the
delivery agent (i.e. the private sector partner). Furthermore the authorities would be able to
retain control of the delivery of services, and there would not be the requirement for, and
additional complexity involved with, robust contract management.
However as with the first option there are drawbacks in terms of suitability for the three
authorities. The need for rigorous performance management is still apparent, as the unit must
be able to demonstrate success, in terms of the needs of the individual authorities, and be
sufficiently flexible and reactive to resolve issues efficiently. There is more scope in this model
for achieving disparate objectives as the control lies solely with the individual authorities,
however this lack of congruence could restrict the success of the partnership to some degree.
Following from discussions held with the partner authorities it is apparent that there may not be
the impetus and knowledge within the authorities in terms of project and programme
management, process re-engineering skills, change management, for example, to facilitate and
implement such a change within the authorities. There may also be a need for independence
and separation from the partner authorities in defining and operationalising the model in order
to make the change as effective as possible. This concern would also stand true in terms of the
sustainability of such a delivery model where the need for best practise experience and
innovative skills is necessary to maintain momentum and benefits across the partners.
5.3.2.7 Examples of application of this model elsewhere
The details stated below are not verified and taken in good faith only, and are in no way
endorsed by Deloitte.
Partnership Services
Norfolk Connect Partnership (8 Councils
inc. Districts and County)
ICT; Customer Contact
Association of Greater Manchester
Authorities
Procurement
(Sources Local Government Chronicle; Norfolk Connect Website)
Detailed Case Study:
The benefits and details stated are not verified and taken in good faith only, and are in no way
endorsed by Deloitte.
Corporate Services
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Consortium of North West District Councils
Established in 2001 this consortium of 5 authorities has implemented joint consultation and
procurement services. The partnership is not a legal entity, moreover it is a collaborative
enterprise governed by committee and board. The partnership has its own budget, targets and
performance indicators on which they report monthly to the Governance Board and the funds
are mainly derived from an annual subscription fee each authority pays, however this funding is
often increased through income generating initiatives via external organisations such as the
Regional Centre of Excellence.
When procuring services or goods the partnership cannot issue contracts on behalf of the
authorities. A lead authority is usually appointed and standard terms and conditions for all
authorities agreed, however each authority will have their own contract with the supplier, or
else a framework contract is implemented. However, this arrangement is complex and this can
lead to prolonged procurements and benefit achievement timescales. Legally this is also
potentially restrictive for suppliers as each arrangement could mean multiple contracts and
contract managers. Furthermore to achieve these benefits large input from the private sector in
terms of advisory services has been required.
The authorities involved have enjoyed a substantial amount of benefit through Economies of
Scale (both cashable through increased buying power, and non-cashable through reduced input
need), as well as improved services and processes both for the individual authorities and the
customer. Indeed the partnership has gained local and national recognition for both services.
Over the past 5 years, since its inception, the individual partner authorities have achieved
between a 5 and 30% saving across both the procurement and consultation services.
(Source Consortium’s Website)
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5.3.3 Option 3: Three-way Public Partnership with Private Sector Involvement
on Service by Service Basis
A Public partnership can involve the private sector on an incremental basis, combining service
delivery between in house provision and outsourced services. This way the involvement of the
private sector can be procured on a service by service basis depending upon need, with the
remaining services being delivered as a partnership of authorities.
5.3.3.1 What would this mean for the three Authorities?
The three-way partnership as described in Option 2 would be established. However, in addition,
services would be further analysed in terms of delivery options. Business cases for each service
would be undertaken, referencing internal capability, value for money, current performance,
best practise and cost (building on the analysis already undertaken). This will allow the
partnership to establish which services should remain in house within the shared service unit,
and which services are appropriate for delivery through the private sector.
This would facilitate a robust approach to maximising value, whilst also overcoming much of
the complexity associated with the disparate aims of the three authorities. Where strategic
partnerships require very long term delivery agreements, this option would allow the authorities
to develop relevant contracts with the most suitable and best value suppliers for individual
services; and where appropriate services will remain in house thus maintaining knowledge and
capability within the authorities. Where skills or knowledge are not available in house
procuring this resource externally would enable the development of internal capacity and
knowledge, this should also improve capability across the authorities (not just in that particular
service area) helping the authorities to capitalise on thebest staff, establishing best in breed
service provision.
This option obviously means that the partnership would potentially have to undertake multiple
procurements and as such the cost of procurement would increase. There is also the risk that
due to the lower level of services indicated within the ‘basket’ for private sector involvement
there may be a reduced level interest from the private sector. However procuring private sector
partners for individual services is not unusual and many of the service agreements in operation
currently are based around the delivery of few services rather than all corporate services
together.
Strong contract and relationship management is once again required in order to maximise value
and minimise risk. The measuring and monitoring of all services – whether provided internally
or externally is vital to the success of this model. Where expected levels of achievement and
benefit are not being achieved in a certain service, analysis of processes / performance must be
undertaken by the partnership to resolve any issues and generate successful delivery.
Political and operational support is again necessary to enable successful transformation.
However, unlike the large scale delivery partnership, entering into agreements with multiple
providers based on specific business cases and implementing suitable contracts with
appropriate suppliers, coupled with keeping core services in house where necessary should
build service provision which is both robust in terms of delivery as well as being robust in
terms of business case and appropriateness for the authorities.
5.3.3.2 Examples of application of this model elsewhere
The information stated below is not verified, taken in good faith only, and is in no way
endorsed by Deloitte
Authority Partner Services
Hertforshire County
Council
Amey PLC and
Mouchel Parkman
Highways and Streetlighting
Corporate Services
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Suffolk County and Mid
Suffolk District
BT Customer Services; Financial
Services
Essex County Council Nabarro Nathansons Legal
Rossendale Borough
Council
Capita Revenues and Benefits;
Customer Services
Stirling Council Dundas and Wilson Legal
Birmingham City Council Vertex Customer Services
Birmingham City Council Capita ICT
AGMA TBC Currently scoping joint
delivery of Revenues and
Benefits
Detailed Case Study:
The benefits and information stated are not verified, taken in good faith only, and are in no way
endorsed by Deloitte
Background
Liberata have partnered Barrow in Furness Borough Council in the Revenues and Benefits
services. This service has now been extended to 5 other local authorities ( London Borough of
Southwalk, London Borough of Houslow, North Somerset District Council, Swindon Borough
Council, and Trafford Borough Council), as well as providing ICT support to Redcar Council.
This arrangement has delivered significant benefits to each authority, namely annual
improvements in collection rates, with the service now performing in the upper quartile.
Furthermore processing improvements have also been achieved, with processing time being
reduced by 117 days on average at London Borough of Southwalk, for example.
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5.4 Summary of the options available
In summary, the options available to the Councils, which will provide them with the most
likelihood of successfully achieving the aims of the partnership, are as follows:
5.4.1 Governance
Creation of a semi autonomous shared services unit across the three Authorities. This unit to be
governed by either:
• Committee or;
• Joint Venture Vehicle.
5.4.2 Service Delivery
Services to be delivered by either:
• Large scale private sector partnership - encompassing as wide a range of non-
strategic corporate services as possible;
• Public partnership – all services delivered by common resources via shared
services unit provided by the partnership. Phased approach to creation of unit
involving:
o Phase 1 services:
� Revenues and Benefits;
� Customer Services;
� Supporting ICT;
o Phase 2 services:
� Human Resources;
� Finance;
� ICT;
� Legal;
• Mixed public and private sector delivery – services selected on a business case
basis for provision by private sector. Remaining services remain under public
provision through shared service unit
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6 Assessment of Options
6.1 Assessment criteria
The criteria with which to assess the suitability of short-listed service delivery models to meet
the partnerships strategic objectives were agreed through workshops and stated below:
• Opportunity to improve customer experience –
Access to best practise / improved access channels; ability to provide consistent
excellent customer service, flexibility of the structure to respond to demand;
• Opportunity to improve staff development –
Access to appropriate and best practise training; access to knowledge and
knowledge leaders via knowledge management processes; robust career paths
and career management processes; ability to attract and keep high quality staff;
• Opportunity to generate capital investment
Investment prospects in facilities (including buildings, kit etc); technology;
• Opportunity to reduce operational costs
Ability to implement improved processes and technologies; ability to reduce
inefficiencies; ability to take advantage of economies of scale and reduce
replicated processes;
• Ease of implementation
Low relative cost; high speed of implementation; low relative resource
requirements and need for specialist resource; low relative levels of process
complexity;
6.2 Options Appraisal
We facilitated a workshop, held on the 6th December 2006 and attended by Chief Executives,
Deputy Chief Executive and heads of service from each authority. A facilitated appraisal of the
short listed governance and delivery options was undertaken with each authority feeding back
into the group through the use of voting technology their consensus view. Each authority was
asked to weight the assessment criteria and then to score the relative opportunities provided by
each delivery option in meeting the criteria.
This exercise provided a consensus view of the parameters within which the Councils will be
able to succeed in working together.
6.2.1 Governance options:
Through discussion at the workshop it was confirmed that a working board arrangement was
already in place governing the delivery of certain collaborative services across the three
authorities. This Board already had memoranda and legal underpinnings to share equitable risk
in the event of one authority leading any procurement on behalf of the others.
With this in mind, this established governance arrangement should be extended to include any
shared corporate service delivery function. Discussions should be undertaken with the
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appropriate legal teams to ensure these additional roles and responsibilities are understood and
accepted by each authority.
6.2.2 Service Delivery Options
6.2.2.1 Criteria weighting
During the workshop, each authority was asked to weight each criterion on a score of 1- 5, with
5 being the most important to them and 1 being least important. The results are shown below.
Criteria Relative Weighting
Opportunity to reduce operational costs 5
Opportunity to improve customer experience 4
Opportunity to improve staff development 3
Opportunity to generate capital investment 3
Ease of Implementation 1
This clarifies that for the three Authorities reducing the operational costs of service delivery
was the most important criteria, with improved customer service behind that. Staff development
and opportunities to generate capital investment following. The ease of implementation of the
model was the least important criteria to the Councils.
6.2.2.2 Scoring the options
Following the agreement of the weightings, each authority then scored the options against the
criteria. These scores were amalgamated and multiplied by the weightings to derive a
consensus view of which option could be successfully achieved together.
The results of the appraisal of each option are shown below:
Opportunity
to improve
customer
experience
Opportunity
to improve
staff
development
Opportunity
to generate
capital
investment
Opportunity
to reduce
operational
costs
Ease of
Implement-
ation
Total
score
Public, Public,
Public
partnership
52 27 18 55 9 161
Part public,
part Private
partnership
36 30 27 65 7 165
Large scale
strategic
private sector
partnership
20 21 42 50 7 140
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The workshop identified that across the three Authorities, the option which has the greatest
consensus as to its likely success in delivering the objectives, is a shared service unit which
delivers services through a public partnership but engages with the private sector , where
necessary, to deliver individual services identified on a business case basis.
This is closely followed by a shared service unit delivered through shared public sector
resources provided by the three authorities.
The option of engaging with the private sector through a large scale partnership was considered
by the group the least likely to deliver the required objectives.
The obvious ‘outliers’ in terms of the scoring, which require some interpretation are:
• Significantly lower customer experience through the large scale strategic partnership:
This is often cited as a weakness for private sector involvement due to the cultural
differences and ethos between the two sectors. The argument extends that the larger the
private sector involvement the more apparent these differences are especially in front
office services. Whilst historically this argument held more weight in earlier strategic
partnerships, the more recent ‘intelligent’ partnerships between the public and private
sector can manage this risk. However there is clearly a more significant degree of
cultural challenge in a large scale partnership, which whether perceived or actual is
likely to have an impact upon the customer experience.
• Opportunity to generate capital investment: One of the clear attractions of long term
partnerships with the private sector is their ability to provide investment in capital
infrastructure which may not be available through the partnerships funds. This
investment is likely to correspond to the size and length of the contract entered into. A
large scale, long term partnership is likely to generate greater capital investment than a
piecemeal service by service arrangement.
• Opportunity to reduce operational costs: Reduction in operational costs requires
redesign of process, structures and targets alongside managerial innovation. These
techniques can be applied by the introduction of the private sector, or through in house
capabilities. It should however be recognised that within a private sector led efficiency
drive the reduced operational costs will be achieved to maximise the profit generated,
and depending upon the contract likely to be retained by the private sector. Within a
public arrangement any efficiencies are retained inhouse.
Whilst it is recognised that the workshop outcomes are tempered by differing degrees of
experience in alternative service delivery by the attendees, the outcomes where consistent with
findings gathered earlier in the review, both through individual interviews and group working
facilitated by Deloitte.
6.2.2.3 Final appraisal of options
Through the workshops and wider observations it is possible to conclude:
• There is a clear opportunity (an appetite) to achieve efficiencies through operational
scale and process redesign by the creation of an autonomous shared services unit which
provides corporate services back to each authority.
• The partnership does not display a strong enough appetite as a group for the
involvement of the private sector in the form of a large scale strategic partnership,
however is not adverse to the private sector involvement per se. In addition it is
recognised that the partnership may lack internal skills to manage process redesign etc
that would be required to deliver efficiencies.
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With these factors in mind, it can be recommended that alternative service delivery for
corporate services is pursued through the creation of an autonomous shared services unit
which combines services from across the three authorities into one team with consistent
processes and single management structure. Where necessary a partnership is entered into
with the private sector to deliver individual services, where a business case identifies a
clear need to do so. This is an incremental use of the private sector rather than a large scale
strategic partnership.
However, with this in mind the recommendation need to be considered against each individual
authority’s strategic priorities.
6.2.2.4 Consideration against individual authority’s strategic aims:
As stated above, as a partnership the option most likely to succeed in achieving alternative
delivery of corporate services which achieves the agreed criteria is a shared service function
delivered with a mixed public and private partnership, however achieving these will require:
• strong internal project management skills;
• internal process redesign and benefits realisation skills;
• internal change management and communication skills
If these skills are not available internally across the three councils it will be necessary to
procure additional support in this area. Without a strong application of these skills, this option
will be unlikely to deliver the required benefits.
However it is also recognised that this option may restrict the opportunity for generating inward
capital funds for investment in service delivery, as it may be perceived by the private sector as
a restricted opportunity and therefore not as economically attractive as a large scale partnership.
As ultimately there is no consensus amongst the partners in terms of the relative importance of
inward capital investment, this option may not go far enough by itself for those authorities
which consider inward capital investment as a primary importance, and it may therefore be
necessary in this case for those authorities to pursue a large scale private sector partner that will
deliver in this area on an individual basis.
If this situation did arise, and one authority within the partnership wished to enter a large scale
strategic partnership independently of the others, it would be recommended that this authority
names the other authorities as potential partners in the OJEU procurement process, which
would allow the agreed contract to be extended to include the others as future partners without
having to enter into a separate procurement exercise.
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7 Recommendation and conclusions
As a result of the options appraisal it can be concluded that:
• Governance: governance arrangements supporting closer collaboration should be
conducted through the existing board arrangements, with necessary additional legal
underpinnings to ensure appropriate risk sharing is drawn up;
• Delivery: As a partnership the option of closer collaboration is most likely to be
achieved through the creation of a shared services unit with any private sector
involvement brought in on a service by service basis based upon business case
decisions:
o In order to maximise the opportunities inherent within this model, the
partnership will need to equip itself with appropriate project management,
change management, process re-engineering and communication skills. These
skills should be drawn from internal resources if available, or provided through
external support if necessary;
o It is acknowledged that this option may not deliver the necessary inward
capital investment to meet each authorities strategic aims. Discussions should
therefore be held as to whether individual authorities wishes to pursue a single
procurement of a large scale private sector partner. In this instance it would be
recommended that this authority name the other authorities as potential
partners within the OJEU notice, to ensure that any contract negotiated can be
applied to the others without having to enter into a separate procurement
exercise if they wish to enter into this arrangement at a date in the future.
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8 Appendices: Detailed Services Assessment
8.1 Service Evaluation
The following service assessments refer to the main services offered by departments across all
three authorities and in some cases do not include all services. Where a service is not listed
only one or two of the authorities undertake it and it is also seen as a very low volume activity.
8.1.1 Revenues and Benefits
Service Scope; Process and Delivery Complexity:
The services operated within Revenues and Benefits are:
� Council Tax; � NNDR; � General Income collection; � Debt / Non-payment management; � Litigation; � Bailiff Services
Whilst Council Tax, NNDR, General Income collection, and Debt / Non-payment
management are seen as appropriate for a joint corporate services delivery due to their
relative low process complexity. Although certain aspects of policy may differ between the
authorities and these will have to be considered in delivering a combined service.
Litigation poses some difficulties as this aspect of the service is seen as specific to the
individual authority, and legally would pose problems, as generally this would be governed
by the particular policy of the organisation. Bailiff Services are currently, in all cases,
outsourced and are thus excluded from this phase of investigation.
Whilst Chesterfield BC operates all aspects of delivery directly through their Revenues and
Benefits Department with much of this transferring to Customer Services in the near future;
Bolsover (Face to Face services) and North East Derbyshire (Face to Face and Telephony)
already engage their Customer Services Departments to facilitate the delivery of some
aspects of the service.
Volumes: Typically mainly due to the volume of transactions, Revenues and Benefits would make up
the core of any Corporate Services delivery, and this is true of the situation within all three
authorities here. All three operate multi-access channels with reasonable volume of activity
through each – although on-line payment options are still fully to be adequately taken
advantage of. There is no use, at present, of 3rd party payment providers such as PayPoint
outlets
Systems:
Both Chesterfield and Bolsover are using the Academy system to provide the service, whilst
NE Derbyshire are in the process of implementing the same system. However although the
fact that all authorities are, or soon will be, using the same IT system this should only be
viewed as the foundation for joined provision, as bespoke modules and individual
developments are operated within each authority’s technology.
Current levels of Collaboration:
Informal collaboration exists across the authorities in the form of discussion groups and
open communication. However there is little evidence of current formalised collaboration.
Barriers to Collaboration:
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Although generally between the authorities barriers are minimal, in terms of provision, it is
recommended that delivery models become consistent across all authorities, furthermore
increased use of Customer Services is suggested (as seen at NE Derbyshire). Therefore this
would mean that inclusion of at least this aspect of Customer Services would have to happen
to facilitate the provision of Revenues and Benefits within a joint corporate services model.
Drivers for Collaboration:
Broadly speaking the political appetite for including Revenues and Benefits within the
model is very high. It is seen as an obvious area for achieving economies of scale and thus
providing benefit to each authority. In addition the resourcing models are reasonable
comparative as is the maturity of provision in terms of use of technology and access
channels.
Conclusions:
The Revenues and Benefits service is seen as optimum for inclusion within a primary phase
of delivery.
8.1.2 Customer Services
Service Scope; Process and Delivery Complexity:
Currently Customer Services is provided collaboratively by North East Derbyshire on behalf
of NEDDC and Chesterfield BC, whilst Bolsover independently provides the function.
The services included within the delivery of Customer Services, however, alter between
each authority. Bolsover and North East Derbyshire have implemented a significant number
of services, and are thus operating a mature model; where as Chesterfield are looking to
build on the services incorporated, currently having only Environmental Services operating
within their CS department.
More investigation is needed into the differences in processes between each authority,
however it is safe to assume that the level of complexity involved in delivering each is low
in as far as the level of highly specialised resource needed to progress the majority of
enquiries is low. However there may be differences in policy between each authority that
will need to be accounted for when delivering each service.
Volumes:
In addition to Revenues and Benefits, Customer Services also traditionally are a part of
corporate services deliveries. However, volumes of transactions within Customer Services
are reliant upon the number of services taken on by the department. As such the level of
transactions handled by NE Derbyshire’s and Bolsover’s customer services departments are
greater than those undertaken by Chesterfield’s.
There is multi-channel access provision (Telephone, Post, Face to Face, internet, SMS), yet
Chesterfield only has telephone and post access within the department, and similarly to
Revenues and Benefits again the provision of web form access is low and this medium is
still to be used to its potential. Use of SMS messaging has been implemented across all three
authorities, yet this is generally used as communication tool for ‘news alerts’ rather than as a
customer access channel.
Systems:
All three authorities have implemented Northgate as their CRM; however in terms of
telephony systems North Derbyshire and Chesterfield use McFarlane, where as Bolsover use
Siemens. Although the same CRM system is used across the authorities, each system will
have bespoke modules and processes built in to them and as such if joint provision for
Customer Services is implemented work will need to be undertaken to bring all systems in
line with each other.
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Current levels of Collaboration:
The relationship between North East Derbyshire and Chesterfield in terms of Customer
Services is well established – providing many benefits including economies of scale through
formalised joint working. Bolsover are also currently collaborating with Derbyshire County
Council on a Customer Services project, implementing at the end of the year. However there
is little formalised collaboration between Bolsover and North East / Chesterfield, although
informal discussion groups and knowledge sharing does take place.
Barriers to Collaboration:
Although Customer Services collaboration is advanced between North East Derbyshire and
Chesterfield, the profile of services included in this delivery offering differs between the
two authorities, with North East taking more of a lead role in its provision.
Furthermore there is a strong political push from Bolsover to not be included within joint
provision of this service. There are concerns from Bolsover that the already established
formal joint working arrangement with Derbyshire County Council could be jeopardised
through any arrangement with Chesterfield and North East Derbyshire. Moreover any
centrally located team from all three authorities involving moving the established Bolsover
team is seen as potentially difficult due to Bolsover’s current property arrangements. In
addition Bolsover have recently undertaken a large programme of process redesign within
the department and implementing another major change programme is seen as potentially
detrimental to service.
Drivers for Collaboration:
The well-established relationship between North East Derbyshire and Chesterfield lays the
foundation for a successful joint provision of Customer Services. Furthermore resourcing
profiles for the two departments (Bolsover, and North East / Chesterfield) are similar in
terms of roles and responsibilities.
Conclusions:
The joint provision of Customer Services is seen as optimum for inclusion within a primary
phase of delivery. It is suggested that, however, thorough investigation of the use of virtual
technology should be investigated as this may bring collaborative opportunities with
Bolsover.
8.1.3 Finance
Service Scope; Process and Delivery Complexity:
The main services operated across the Finance departments are:
� Accounts production (incl. management and implementation of new legislation); � Management of purchase orders, invoicing and account reconciliation; � Budget setting and management; � Payroll; � Insurance services
Finance is made up of various services each of which vary in the level of complexity
involved in their execution. To this end Accounts Production; Budget Setting and
Management are seen as highly complex and thus not suitable for inclusion in this phase.
Bolsover are currently the only authority with a central processing department for purchase
orders, invoice management, and reconciliation as Chesterfield and North East Derbyshire
have devolved these services to the individual departments. However this service is an area
requiring minimal specialist resource to execute.
Corporate Services
Options Appraisal
37
Payroll and Insurance Service Management (not including claims processing) are dealt with
in house by all three authorities and are on the whole relatively low in terms of process
complexity.
Volume:
In terms of volume, however, Payroll services and Insurance Management differ as Payroll
has a moderate high volume of activity across all authorities where as the latter in
comparison has minimal volume of activity associated
Despite the fact that only one authority provides purchase management centrally there is still
a moderate volume associated with this function.
Systems:
In terms of the Financial Management Systems used, Bolsover use Civica, Chesterfield use
Agresso, whilst North East Derbyshire use Task. All three systems are recently implemented
and have bespoke models and functionality for the individual authorities.
Current levels of collaboration:
There is no formal collaboration in place; however informal knowledge transfer and
discussion groups do exist between all three in terms of VAT, Insurance, and Procurement.
Barriers to collaboration:
Due to the nature of the majority of the work undertaken by the relative finance departments
there is not a large scope of services to include within a joint corporate services offering. As
already stated there is also divergent delivery models operating purchase management
across the three authorities, this if this were to be included in a joint model there would be a
requirement for either a process and policy change within North East Derbyshire and
Chesterfield centralising this service; or a robust recharging model including only Bolsover
for this aspect.
Drivers for collaboration:
There is an appetite for including Financial Services within this offering; furthermore
Payroll services across the authorities have similar resourcing models.
Conclusions:
Although the initial scope would seem limited there are areas that should be considered as
suitable for inclusion within the Corporate Service package. Payroll would be a prime target,
however there is only moderate volume associated with this area and therefore is being
considered as a lower priority than a higher volume service such as revenues and benefits.
There are also other service areas that could present opportunities for inclusion such as
advisory services around new legislation for end of year account production. Presently a
resource intensive activity to understand enforced policy and procedure changes is
undertaken within each authority. This exercise could potentially be undertaken once, on
behalf of all three authorities – thus reducing the resource impact on the individual
authorities.
8.1.4 ICT services
Service Scope; Process and Delivery Complexity: The main services operated within this department are:
� Helpdesk; � System administration and management; � Project Management; � Management of Disaster Recovery plans
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Options Appraisal
38
There are a large number of different systems operating within each authority and therefore
the complexity associated with this service is moderate to high. However, Helpdesk does
offer opportunities within the first and second line support, as in the most part this requires
only minimum specialist/bespoke knowledge to undertake.
Furthermore there are also aspects of System Administration, where still centralised within
the department, that are low complexity, whereas the management of the systems and any
contracts in place with vendors is seen as a complex process; one which should remain
exclusive to the individual authority.
Although project management is in its self a specialist skill, there is little requirement for in
depth specific knowledge of the individual authorities - organisation specific knowledge
would come from local subject matter experts.
The management of Disaster Recovery is seen as a policy decision, however, where a shared
corporate services unit is implemented as an independent service provider disaster recovery
options will need to be defined and implemented.
Volume:
The Helpdesks with each authority handle with moderate to high volumes of enquiries, with
the majority coming through via telephone calls. System administration and management is
also of a moderate volume, where as depending on what projects are undertaken within the
authorities Project Management can either have a large or a moderate volume of activity.
Management and implementation of Disaster Recovery plans is not an area, which has
traditionally had a huge amount of focus, however Chesterfield’s current arrangement has
been tested recently with success, whist Bolsover and North Derbyshire are defining and
implementing plans currently.
Systems:
As already stated there are a large number of systems operating within each authority, thus
in terms system administration and management there are bespoke processes and specific
needs that are addressed internally.
Helpdesk approaches also differ; Chesterfield currently use a database to monitor calls and
manage the service; whereas Bolsover and North East Derbyshire both have implemented
specialised systems to operate the service. All three authorities operate a first line and
second line support in house.
Current Collaboration:
There are no formal collaborative practices in place, however there are examples of informal
collaboration through discussion groups and action groups.
North East Derbyshire are mid-implementation of an ALMO relationship for their housing
function, providing an opportunity for off site disaster recovery. North East Derbyshire has
opened this opportunity up to both Bolsover and Chesterfield. Currently Bolsover and North
East are looking to progress this further.
Barriers to Collaboration:
The current implementation of the ALMO at North East Derbyshire is requiring a high level
of resource input, and thus should be considered when undertaking another resource
intensive IT programme – such as a shared corporate services unit. Furthermore there may
be legal implications and responsibilities associated with this relationship and as such work
needs to be undertaken to ensure that any option around corporate services are evaluated
with this relationship in mind.
Drivers for Collaboration:
Operationally there is appetite for including ICT within a joint delivery of corporate
services, furthermore the resourcing profiles of each authority is similar. Bolsover currently
Corporate Services
Options Appraisal
39
are experiencing a degree of under-resourcing, with some need for an improved skill set. By
working more collaboratively, in a formalised manner, skills transfer between the authorities
can be facilitated, thus improving resource profiles.
Conclusions:
There are many opportunities for inclusion of ICT services within a joint corporate services
delivery. There would need to be some degree of process re-engineering as due to the
number of incumbent systems. Also any services, which are included within the joint
delivery, would also have to be supported by the corresponding ICT function.
8.1.5 Human Resources
Service Scope; Process and Delivery Complexity:
The main services operated within this service are:
� Training – administration, and management; � Recruitment - administration; � Personal Record Maintenance; � Health and Safety; � Equality; � Occupational Health; � Dispute management; � Project work; � Policy definition and management; � Succession Planning; � Strategic change definition and implementation; � Union Liaison
Many of the services operated within Human Resources are related to the strategic or policy
direction of the individual authority and are thus excluded from this options appraisal
(policy definition and management, strategic change definition and implementation, union
liaison, succession planning and dispute management.)
There are, however aspects that are seen to be of low complexity and thus appropriate for
inclusion within a joint corporate services delivery - Training administration and
management; Recruitment administration; Equality; Occupational Health. Some of these
services (Occupational Health and Equality) are provided collaboratively already, with the
former between all three authorities and the latter provided between North East Derbyshire
and Bolsover.
Maintenance of personal records is primarily delivered centrally at Bolsover, yet is devolved
at Chesterfield and North East Derbyshire, furthermore the specific nature of this activity
would limit the scope for inclusion within a shared delivery unit.
Volume:
There is moderate volume of activity associated with each of these services however
individually the activity levels are not comparable to a large volume service such as
Revenues and Benefits.
Systems:
Chesterfield currently use Northgate as their Human Resource system, where as Bolsover
and North East Derbyshire both use Cris 21. Both systems have the functionality for some
self-service around basic information changes such as address alterations, however these
options have not been fully realised at any of the authorities.
Current levels of Collaboration:
Corporate Services
Options Appraisal
40
There is formal collaboration between the authorities through the provision of Occupation
Health, and then again with Bolsover and North East Derbyshire in the provision of
Equalities (shared Equalities Officer).
There is also informal collaboration in place in the form of discussion groups.
Barriers to Collaboration:
Each authority is at differing levels of single status implementation and this is drawing on
much HR resource to implement. The resource needs at North East Derbyshire are further
impounded by the implementation of the ALMO.
Terms and conditions between the three authorities differ and this will have implications on
management of staff as well as record keeping if the authorities were provide HR as a joint
corporate services delivery.
There is also a perception of discrepancy between the councils around the results of Job
Evaluation; it is thought that there will be scale differences between similar roles at the
individual authorities.
Drivers for Collaboration:
There is a political appetite for inclusion, and the resourcing profile within each authority is
similar.
Conclusions:
Although there are services, which would be very suitable for, inclusion within the Joint
Corporate Services delivery the volume associated within each is only moderate. There are
also a number of resource intensive projects ongoing within each authority that would draw
on the same resource pool that a corporate services implementation would require.
8.1.6 Legal Services
Service Scope; Process and Delivery Complexity:
The main services operated within the department are:
� Litigation; � Prosecution cases; � Contract administration management and implementation; � Land Charges; � Freedom of Information request handling; � Administration and award of licencing; � Planning, Environmental Services, and Housing Support; � Legal Conveyancing; � Committee Support (e.g. Housing Appeals)
The complexity involved within the delivery of this service is high and many of the
activities are bespoke and need to remain specific to the individual authorities such as
Litigation; Contract administration management and implementation; Service and
committee support; Prosecution; and Conveyancing.
Although administration and award of licencing is seen to be reasonably transactional in
terms of delivery, this area is provided jointly through Legal Services and Environmental
Services. This joint delivery adds complexity to this service and thus is recommended for
future assessment, rather than inclusion in the primary phases of implementation. Freedom
of Information request handling is also reasonably transactional, however, this is a service
that is provided differently within each authority and is thus recommended for future
implementation
Corporate Services
Options Appraisal
41
The services seen as lower complexity and thus more suitable for inclusion in a joint
delivery are land charges, and FOI request handling.
Volume:
There is a moderate amount of activity associated with each of these services however
individually the activity levels are not comparable to a large volume service such as
Revenues and Benefits.
Systems: There are a variety of systems in place and these are supported by a number of manual
processes within each authority. In terms of Land Charges there is a need for increased
investment within technology, both due to the forthcoming legislation around electronic
records and also to improve the efficiency and effectiveness of the services where manual
and paper based systems are restricting performance.
Current Levels of Collaboration: There is no formal collaboration in place currently however there are examples of informal
collaboration through forums such as the Planning Special Interest Group, which is borough
wide, and discussion groups.
Barriers to Collaboration:
There is legislation being implemented over the next few months, which will affect the
current processes around land charges, and this will need to be considered if this service is
included within a joint corporate services delivery.
Drivers for Collaboration:
There are some investment needs within the provision of Land Charges; furthermore with
the new requirements around electronic records there will be more requirement for
investment over the coming months.
Conclusion:
There are opportunities for collaboration within Legal Services, however the volume of
activity within each area is only moderate. Legislation is being introduced as well which
potentially impact on timescales and this ought to be considered before introducing these
services within a shared delivery.
8.1.7 Service Evaluation Summary
The above evaluations are summarised in the following table. Green indicates a current
optimum level against the criteria; Amber indicates a favourable level against criteria; and Red
a low level against criteria. For example in terms of Systems: Green – all three authorities use
the same system; Amber – two authorities use the same system and the other uses an alternative
system; Red – all three use different systems.
Corporate Services
Options Appraisal
42
Volumes Systems Current
Level of
Collab.
Process
Complex'y
Drivers Barriers Total
Assessm't
Council Tax 3 1 3 3 3 Core 1
NNDR 3 1 3 3 3 Core 1
General Income -
parking fines etc
3 3 1 3 3 3 Core 1
Debt / Non-payment
Chasing
3 1 3 3 3 Core 1
Telephony 3 2 3 3 2 Core 1
Email / Web forms 2 2 3 3 2 Core 1
SMS 1 2 3 3 2 Core 1
Kiosks 1 2 3 3 2 Core 1
Post 3 2 3 3 2 Core 1
Face to Face 3 2 3 3 2 Core 1
Training co-ordination 2 2 3 3 3 Core 2
Recruitment
administration
2 1 3 3 3 Core 2
Personal Record
Maintenance
3 1 2 2 2 Future
Health and Safety 2 1 2 3 3 Core 2
Equalities 2 2 2 3 3 Core 2
Succession Planning 2 1 1 1 1 Future
Policy Definition and
Management
3 1 1 1 1 Future
Employee relations
(Unions, Dispute
management, Tribunals)
2 1 1 1 1 Future
Payroll 2 2 3 3 3 Core 2
Insurance services 1 1 3 2 3 Core 2
Invoicing / Transaction
Processing
2 1 3 1 2 Future
Account production 3 2 1 1 1 Future
Budget Management 3 1 1 1 1 Future
Helpdesk 3 2 3 3 3 Core 2
Management of Disaster
Recovery
1 2 2 3 2 Core 2
Project Management 3 2 2 3 3 Additional
System administration
and management
2 2 1 2 2 Future
Land Charges 2 1 3 3 2 Core 2
Freedom of Information
request handling
1 1 3 1 1 Future
Administration and
award of licencing
2 1 2 1 1 Future
Prosecution 2 1 1 1 1 Future
Litigation 2 1 1 1 1 Future
Legal Conveyancing 2 1 1 1 1 Future
Service Support 2 2 1 1 1 Future
Committee Support 2 1 1 1 1 Future
Contract award and
management
2 1 1 1 1 Future
ICT:
Legal Services:
Corporate Service - Short List
Revenues and Benefits:
Customer Services:
Finance:
Human Resources: