Shared Services

SocITM Annual Conference at Brighton 11th October 2010

Geoff Connell – London Boroughs of Newham & Havering

Andy Heys & Graham Catlin – Cheshire Shared Services

It Might Look Calm on The Surface, But We Are Paddling Like Mad!

• We know that we have to cut our ICT overheads. And yet we must retain sufficient capacity to transform council service provision in order to make the big savings that are needed.

• How do we do this?

• Continue down an evolutionary path of incremental savings?

• Outsource all or some of our services and share the savings with a private sector supplier / partner?

• Or, we could retain ALL of the savings in the public sector by sharing services. This presentation will show you how this is possible.

Slide 3

Agenda

1. Introduction – What are shared services?2. Cheshire Example.3. East London Solutions – Newham and Havering Example.4. Panel Discussion / Q&A.

Slide 4

Introduction – What are shared services?

• Different things to different people – massively overused term.• Largely hype in the past perhaps?• They require a buyer and a seller. We can’t all just sell our

services. Someone has to give up budget &/or control.• Different models: franchise under common management, mergers

and acquisitions, joint outsourcing, aggregated procurement etc.• Can come about in a variety of ways, but need a strong driver for

change and a willingness to change in order to get up and running. • We will present a couple of examples of how they can come about,

how they can work and what challenges to watch out for. • 1st up is a real and established example from Cheshire.

Andy HeysGraham Catlin

( )shared = -29%6D+ 1C2

Year Zero

Set Up Service

Rationalise Technology

Deliver Transformation

Set Up• Structure

– Hosted– Delivery & Commissioning

• Mood– Trust, Suspicion and Control

• Staff– Reduction– Competency and skills– Communication

• Big savings, but how much?

Rationalise• Harmonise applications

• Revs and Bens• Oracle R12

• Centralise services• Kelly House & Macclesfield Technology Centre• Service Desk

• Simplify activities• Standard business processes• Incident control

• Renew culture• Professional services• One team

We had achieved a lot, but…

• We needed:• Leadership• Governance• Planning• Focus

• We needed to know what we were trying to achieve, prioritise and to stop fire fighting!

• A battle weary team who had achieved great things very quickly

• A team on the way to demonstrate that private sector savings can be achieved the public sector

• A team that needed a plan to be recognised as a professional, efficient service delivery team

What did I find?

What did I do?

• Leadership

• Governance

• Planning

• Focus

What key lessons did we learn?

Over 100

individual

points

What key lessons did we learn?

• Baseline performance• Communicate relentlessly• Focus on governance• Realise the benefits; and,• Remember: Culture trumps everything

What next?• Recruited a permanent replacement HOS• Further savings• Service Improvements• Potential clients• Commercialisation

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East London Solutions (ELS) & Newham and Havering ICT Partnership Working Arrangements

• Funded by Capital Ambition and the boroughs• Support team led by Rita Greenwood.• Various works-streams led by each borough.

Our purpose

• To re-shape services that better meet customer needs • To deliver greater efficiencies and savings to release

funding for priority areas • To make better use of capacity and skills • To improve the ability and capability to deliver services in

partnership • To deliver increased collaboration in East London • To promote better engagement with established projects • To challenge the Status Quo • To provide improved awareness of opportunities

Our Vision

"Deliver and commission shared and collaborative services and products to facilitate improvement, efficiency and innovation."

Slide 16

Objectives of the Newham & Havering Shared ICT Arrangements

• To reduce the overheads associated with running Newham and Havering’s ICT support services.

• To share knowledge and skills in order to improve the quality of the respective ICT infrastructures and services.

• To accelerate the rate of improvement of Havering’s ICT infrastructure.

• To demonstrate what could be achieved through partnership working with a view to offering the arrangements to the other ELS boroughs.

• Operates as a “franchise” & “centre-of-excellence” model.

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How did it come about?

• ELS & ICT Work-stream Lead.• Turkeys don’t vote for Christmas! Vacant Head of Service.• It’s all about people and trust. “Hi are you busy? Could you come

and run our ICT service?”• 1 Month assessment. Didn’t look promising at first.• Sold a Roadmap to Havering CMT and Cabinet.• Approval through agile Members and Management arrangements.• Objectives and estimated savings agreed by both authorities.• Labour Mayoral approval & Conservative Leader agreement to

formalise partnership working.

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How does it work?

• Leadership package - 1*FTE – Shared Head of Service, PA Support & technical expertise where needed. Critically - Enterprise Architect to align technologies.

• Converging ICT roadmaps. Standardisation key to savings.• Can operate as a “franchise” : aligned teams in each borough. And/or as a

“centre-of-excellence” model : One borough provides service, other consumes. (Microsoft & Oracle examples).

• Sharing of experienced resources.• Reshuffling when vacancies arise – natural attrition/wastage.• Process by process (ITIL) review and rationalisation.• Extending the arrangements into other authorities, could include overall

management control or offer discrete services at a lower cost, higher quality or both. An alternative to in-house or outsourced alternatives. (AD Forest)

• Joint procurement where outsourcing/hosted/cloud offering offers best value.

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What savings have been achieved & What are planned?

• Newham & Havering have already made significant revenue savings over last 3 years (> £1M).• Doing much more would have been very difficult without reducing service breadth or quality.• Shared service arrangements are the best way to keep the savings going. • Examples….• 1 head of service, one 1 PA and 2 contract/consultant senior managers released at Havering.• Plus 7 other FTE headcount reduction achieved due to greater operational efficiency.• Circa £250k income for Newham in 2010/11 (Delivering staff cost savings in Havering).• £1M shaved off Havering capital programme on the basis of shared Info-sec work, better value

driven from existing contracts, etc.• £100k reduction at Havering, year on year minimum saving already allocated.• Better procurement. Microsoft example (procured once rather than twice & increased discount).• Greater value driven through other procurements due to greater choice (Newham data centre

for example).• Shared expertise at actual cost rather than pay market rate for contractor/supplier (& retain

skills / knowledge in-house). • I predicted 15% saving within 3 years, rising to 25% over 5 (from a £20M total revenue budget).

Slide 20

What other benefits have been achieved & what are planned?

• Member and Exec sign up to partnership and technology standardisation roadmap.• ICT Transformational Programme as delivery vehicle for change. Havering

Programme manager and team, but with Newham expertise contributing. Knowledge transfer in progress.

• Legacy technologies being rapidly replaced with confidence of working with a team who have done it before.

• Customer Services Technologies being jointly developed, implemented and supported.

• De-duplication of roles, systems and support arrangements. Head of Service & Enterprise Architect in place. Now looking at Help Desk systems and ITIL lead roles (starting with Change).

• Joint hosted Unified Comms trial (based on MS stack) with Waltham Forest.

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Lessons Learnt / Advice?

• Think big, but start small (if your starting point allows you to do so).• Sell your vision up, down, then across the organisation(s) and keep repeating it. Remember

repetition, repetition, repetition!• Delegate effectively and develop management capacity or your personal capacity will become

the bottleneck. Being in two places at once is really hard.• Get Member backing as early as possible (once you have developed the business case – with a

primary focus on the cost savings).• Appoint a single lead for aspects of the partnership wherever possible to drive standardisation of

policy, procedure and technologies.• Baseline performance and costs so that benefits can be measured.• Remember, you can’t just sell services. To achieve sustainable relationships and savings you

must also be open minded about consuming services. (From other public sector bodies and private sector suppliers, particularly as cloud offerings mature).

• If you don’t win hearts and minds, you will have a constant battle to drive through service changes. Harmonising staff cultures will always be the greatest challenge.

• But it is possible and may represent your best opportunity to make the savings you have to find.• And finally…. I’ve really enjoyed the challenge!

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Thanks for Listening. Questions/Debate?

• East London Solutions (ELS)Geoff.connell@newham.gov.ukGeoff.connell@havering.gov.uk

• CheshireGraham.Catlin@cheshiresharedservices.gov.ukAndy.Heys@cheshiresharedservices.gov.uk