Commissioning & Procurement Transformation
Commissioning & Procurement Transformation

Thurrock Council invited the East of England LGA (EELGA) to carry out a procurement health check in 2012 as it was concerned about its infrastructure for managing and supporting its £170M annual expenditure on third party goods and services. The subsequent report, undertaken by Ken Cole, an associate from EELGA’s “Talent Bank”, was accepted by the Council. It showed that there was an attractive business case for streamlining the whole commissioning and procurement process including upgrading the supporting systems and introducing skills development programmes.

This fitted in well with the Council’s broader transformation programme which had identified it as an area in need of modernisation. In early 2013, the work stream sponsor, Barbara Brownlee (Director of Housing) asked EELGA to lead the transformation programme, with some constraints.  Transformation would be done in twelve months, for a budget of no more than £120k and was required to embed a lasting legacy so that the Council could operate independently from third party consultants.

Ken Cole, recognised as one of the UK’s top procurement and commissioning transformation specialists, led the programme which was divided into six strands of work:

  • Strategy and Policy 
  • Structures and Delivery
  • Business Processes and Technology 
  • Marketing and Communications
  • People (skills and knowledge transfer) 
  • Savings

The scale and complexity of what was required to deliver the transformation, combined with the constraints applied by the client, meant that a series of operating principles needed to be put in place, i.e.:

  • Bringing in proven systems and approaches and piggy backing on the work done by others where possible
  • Using networks and contacts to gain a fast track for each work stream
  • Up-skilling of staff immediately to avoid consultancy dependency and broaden the core team
  • Re-using work done for other clients at no charge
  • Reporting to the Council’s Transformation Board comprising Chief Officers to ensure that it got visibility and support and delivered a lasting legacy

Giving people the authority and skills to make savings from existing contracts and improve supplier performance is crucial if local authorities are going to operate in a tougher financial regime. At Thurrock a ‘contract challenge process’ has been introduced which ensures that all contracts with possible extensions are subject to a review process with the contractor, requests for cost increases are challenged and non compliant contracts replaced.

Barbara Brownlee – Director of Housing and Project Sponsor said “EELGA has been great with the quality  of their support for our project including in providing their associate, Ken Cole”

Kelly Sandiford – Organisational & Development Manager said “This programme identified the importance of investing commercial skills and knowledge in people as a way of driving real transformation”

Key outcomes

A new commissioning and procurement strategy based on unified management of the commercial cycle, making social value and financial value complementary goals.

  • A new Commercial Services structure for clienting Serco, supporting the Council’s ICT strategy, managing policy and encouraging professional development has been put in place.
  • A revised services schedule for Procurement Services between Serco and the Council has been adopted setting out the boundaries and roles and responsibilities
  • A Procurement and Commissioning Management Board, chaired by the Assistant CEO and comprising Chief Officers, has been set up to manage and direct the transformation changes and ensure that savings targets are met and exceeded
  • Electronic quotations (Quick Call), electronic tendering (Delta) and a contracts register (Contract Manager) have been enabled
  • A project to streamline the Oracle i-Procurement implementation resulting in Thurrock becoming only the 2nd UK local authority to implement Oracle i-Supplier (electronic invoices) with over 175 suppliers signed up at the go-live
  • A full one day commercial skills programme has been devised and delivered to 29 key “non- procurement” people.  This covers negotiation, understanding suppliers and contract and relationship management
  • A full range of commercial skills programmes backed by EELGA are being made available to Council staff and accreditation from Anglia Ruskin University is being pursued
  • All staff have been empowered to seek cost reductions against current contracts and there is a corporate policy in place that no contract will be extended without a full performance and cost review
  • A monthly ‘Saver Award’ is given to the member of staff / team that makes the best saving. This  has been introduced as a pilot for a broader recognition programme
  • The project delivered over £200k savings towards its  £900k target in categories such as postal services, catering, furniture, ICT and consultancy

Learning

The learning points from this multi stream transformation project are as follows:

  • Agree a vision and aims at the start that are  expressed in plain language and to which staff can understand and identify
  • Set out clear outcomes that can easily be measured with a simple traffic light system
  • Lead from the top but involve people at every level and listen to their concerns and issues
  • Recognise that a multi-disciplinary approach is required if it is to be successful: finance, audit, procurement, legal, commissioners, chief officers, and external providers too
  • Have a realistic timescale – we recommend no longer than a year to make the changes, and three years to embed them in the organisation
  • Have a proactive, two-way marketing and communications programme
  • Use consultants wisely, ensuring full skills transfer occurs and plan to remove them from the outset

Key statistics

  • The Oracle i-Supplier project took five months to implement, cost less than £30,000 in specialist support and makes Thurrock the 2nd local authority in the UK to have a conversion from order to invoice in five clicks. It is also now three years ahead of the game as all councils are expected to be required to offer e-invoicing by 2017
  • Programme cost just over £100k to deliver providing an attractive ROI when savings start to come on line later in 2014
  • Over 30 people being put through the commercial skills programme - extending the ability to identify and deliver savings

Contact details
Authority contact name and details:  Barbara Brownlee – Director of Housing bbrownlee@thurrock.gov.uk

East of England LGA Contact name and details Eddie Gibson – Senior Manager
Eddie.gibson@eelga.gov.uk

 

This has been a very innovative transformation project which has allowed us to really understand how we commission and procure £170m of goods and services each year

Steve Cox – Assistant Chief Executive Officer - Thurrock Council