With Parliament returning in session, local authorities’ attention naturally turns toward their next strategic review and the challenges it will bring. You don’t have to be close to the matter as to accurately predict what’s on the agenda; once again, the pressure to do more with less will certainly increase.
At the same time, public sector organisations are going through a time of accelerating sophistication and expectations. Initiatives like Universal Credit exemplify the kind of mature, co-ordinated and ambitious strategy that define the new and rising standards. As this variety and complexity continues to increase, the old models of working result in growing duplication of effort.
But many are pursuing a better, more efficient way to tackle these challenges. More and more local organisations are discovering the advantages of pooling resources and increasing efficiency through shared service centres. This concept is nothing new - but as the long list of examples where it’s providing exceptional savings will attest, the quality of execution is a league beyond what many have come to expect.
At the same time, it’s not a silver bullet. Engaging with a strategy on this scale and with multiple stakeholders is always going to require dedication and attention to ensure success. And taking such a path without the right direction and experience is risky business. After a decade of observing, managing and learning from projects in this area, we’ve come to know what works to stack the odds in your favour. And it’s rarely about simply playing the odds - it’s about a thoughtful, considered approach that learns from what works.
Let’s take a look at the key lessons and some real world examples that demonstrate how to get things right. Firstly, and perhaps most importantly, it’s essential that you work with trusted suppliers. But this doesn’t stop at just signing the contract. Communicate with them and make sure you have a thorough understanding of the areas that you need to cover. It’s absolutely essential that you consider these partnerships carefully, execute them with trust and use them to build a foundation to support the rest of your strategy.
It’s worth taking the time to get this right. Decide what the most important factors are to you and use those to establish the trust you require. Consider all areas of the strategy and keep an open mind when considering what this brings to the table - real world execution should always warrant a second look.
Next, don’t neglect the citizen perspective. As part of your initial planning, develop a holistic and comprehensive understanding of the services, admin and broader requirements affected. There may be many more than you think -- but the more you discover, the greater the opportunity for streamlining. Leave no stone unturned to give your shared services project the best chance of success.
Build ROI into your planning and adopt a business mind-set from day one. Just as you need to build a full picture of the elements involved in the work, being able to show the full extent of anticipated and realised savings against your investment is still very important.
A fresh set of eyes on any proposed activity can be another effective way to break out of your assumptions and shed new light on the matter.
So how do these three rules apply in the real world?
We recently unveiled a successful shared services project in South Worcestershire that consolidates the efforts of three councils to generate £3 million of savings within five years. Starting initially with the existing revenues and benefits service for the three councils, the partnership will offer transactional, assessment and a range of other services to support other councils looking to optimise how they run their operations.
It’s not just about small improvements here, it’s things that genuinely affect peoples’ lives. Cllr. Adrian Gregson, Leader of Worcester City Council, sums this up well: “With the advent of Universal Credit, South Worcestershire councils were facing the prospect of having to shed a large number of jobs in the shared revenues and benefits service. This partnership offers an innovative solution to protect local jobs while continuing to give the councils oversight of the service.”
Earlier this year, Gloucester City Council highlighted the success of its reinvigorated council tax collection project. Building on an already strong record of performance, the team has managed to reduce annual costs by £220,000 while increasing performance. In fact, council tax arrears have been reduced by the strongest ever margin this year, down by £1.5 million.
When describing their success, the priorities and focus offer a clear lesson. It’s only by locating weaker spots, and considering how to strengthen them, that better services and delivery models could be developed. A central part of this is adopting new behaviours and ideas from peers and expert third parties, to embed innovation into daily operations and future strategy.
But you may wonder whether these examples are early innovators or simply part of a broader, rising tide of adoption. We’re currently working with Localis to research the various stages of innovation within local government across the country and the factors that find these changes. With the results appearing later this year, we’ll soon see how the use of shared services has spread and how much scope still remains for local government to exploit this enormous opportunity as a rank to wider transformation efforts.
In the meantime, our key advice is to look at the best practice examples out there, learn what made it work and consider how this could transform your operation.