Service Transformation

03.07.17

Public sector outsourcing: a marriage that must work

Source: PSE Jun/Jul 17

Kerry Hallard, the president of the Global Sourcing Association, argues that despite some highly-publicised cases of breakdowns in public sector outsourcing, the relationship has generated much success.

The public sector and the sourcing industry relationship is a bit like a celebrity marriage; it faces ongoing intense scrutiny by the outside world, with its detractors poised to jump on any modicum of news that might support the accusation that it is doomed. They are egged on by the occasional revelation from ‘inside sources’ that has typically been leaked by an agenda-driven relative, whilst behind the ‘public’ façade both sides are usually committed to the relationship and working assiduously to make it a success. 

But whether you are for or against the partnership, one thing is certain: the UK needs this particular marriage to work, and more so now than ever before. 

All around us, the world of consumerism is going through a tsunamic transformative period, with public sector services having to swim extremely hard to keep up or risk being completely overwhelmed. Our population is demanding a better consumer experience all round; they want more tailored services to be made available to them, and at a time that is convenient to them. They want to talk (or text or email) when it suits them, and they want to transact through a range of channels and platforms that can be accessed by them anytime or day. Digitalisation has hit the mainstream, and the public is voraciously consuming it in huge quantities in order to help them navigate the complexities of their own ever-demanding lifestyles. The cost of surviving and thriving in this new digital economy is at a scale, however, that many private sector enterprises are struggling to compete in, never mind their public sector cousins. 

Despite some highly-publicised cases of breakdowns in public sector outsourcing, the relationship between the public sector and the sourcing industry has generated much success. It is easy to understand that in times of austerity, every penny of public spending is scrutinised and private sector providers can be cast as profit-driven bandits, taking public funds and returning a poor service. The reality, though, is that it’s simply not true. The growing market for public sector procurement demonstrates how cost-effective, efficient and competitive organisations have helped deliver crucial services to those most in need, whilst helping the public sector manage costs. 

It’s a fact that spending on public procurement had been growing since its ‘big bang’ in the late 1980s. In 2012, the market in public sector contracts was worth £93.5bn and it has grown since, eclipsing £100bn in the past few years. That said, according to recent research, there was a marked reduction in government allocation of contracts in Q1 2017, from 49 agreed in Q1 2016 to just 22 in the same period this year. Government departments spent £304m on outsourcing in Q1 2017, compared to £1.6bn in January to March 2016. 

The reason cited was that public sector organisations are adopting a ‘wait and see’ approach in the wake of Brexit and the general election. It is no surprise, therefore, that both sides are increasingly looking to see how they can work better together to avoid the blunders of the past and unlock the value beyond what’s in the contract. 

The Global Sourcing Association has been doing its part by creating the Global Sourcing Standard with the help of major buyers of outsourced services, including organisations in the public sector. This is a world-first unifying standard of practice that both buyers and suppliers can be accredited to, in both the private and public sector. It encourages closer strategic alignment and is supported by a framework of transparency principles, competencies and capabilities and best practice. The BBC was the first public sector organisation to become accredited and has since gone on record in estimating annual cost savings of up to £42m through adopting the principles and strategies that have been outlined in the standard. Numerous other public sector (and private sector) organisations have since embarked on the same journey of discovery. 

As the public sector drives for efficiency and cost-effective solutions in the digital age, robotic process automation and artificial intelligence will play a great role in future solutions. Adoption by some councils is encouraging, and it would be worth investing some of your time to learn more about automation. We have, of course, been reminded of the dangers of operating in the digital age: the recent cyber-attack on the NHS has highlighted a vulnerability that will require further investment in sourcing from the public sector. The sourcing industry works closely with cyber security analysts and experts to provide the greatest possible defences against cyber criminals. 

We will be hosting our annual Symposium on 27-28 June in London, with a keynote from Dr David Bray, Eisenhower Fellow and CIO of the US Federal Communications Commission, discussing how cyber security is an issue for all organisations. Whilst you are there, you can also attend a half-day training session on Strategic Process Automation, and find out how you can improve on the broad scope of fundamentals of sourcing, as well as learn more about the Global Sourcing Standard. 

Admission is free to all public sector ‘buyers’ of sourcing services, but you will need to register to attend. Join us and help make the marriage between the public sector and sourcing industry a better informed, more efficient and highly-effective relationship for all.

FOR MORE INFORMATION

W: www.gsa-uk.com/gsa-symposium-2017

Comments

There are no comments. Why not be the first?

Add your comment

 

public sector executive tv

more videos >

latest public sector news

The National Audit Office's guide to cloud services

25/06/2019The National Audit Office's guide to cloud services

The National Audit Office’s digital transformation expert, Yvonne Gallagher, focuses on assessing the implementation of digital and related... more >
How community-led initiatives can help save the housing shortage

19/06/2019How community-led initiatives can help save the housing shortage

Tom Chance, director at the National Community Land Trust Network, argues that community-led initiatives are a productive way of helping to solve... more >
Aberdeen's green transport fleet attracting international attention

19/06/2019Aberdeen's green transport fleet attracting international attention

Aberdeen City Council’s hydrogen spokesperson, councillor Philip Bell, highlights the Granite City’s determination to play a leading ... more >

editor's comment

25/10/2017Take a moment to celebrate

Devolution, restructuring and widespread service reform: from a journalist’s perspective, it’s never been a more exciting time to report on the public sector. That’s why I could not be more thrilled to be taking over the reins at PSE at this key juncture. There could not be a feature that more perfectly encapsulates this... read more >

last word

The importance of openness after Grenfell

The importance of openness after Grenfell

Following the recent Grenfell Tower tragedy, Lord Porter, chairman of the LGA, argues that if the public are going to have faith in the safety testing process then everything must be out in the o... more > more last word articles >
View all News

the raven's daily blog

New rules to change the future of Social Value

05/06/2019New rules to change the future of Social Value

The government has announced the introduction of new rules to change the future of social value and make the way housing developers stump up the money for infrastructure both simpler and more transparent. These regulatory changes are designed to help achieve its ambition to deliver 300,000 extra homes per year by the mid-2020s.  ... more >
read more blog posts from 'the raven' >

comment

Peter Kyle MP: It’s time to say thank you this Public Service Day

21/06/2019Peter Kyle MP: It’s time to say thank you this Public Service Day

Taking time to say thank you is one of the hidden pillars of a society. Being on the receiving end of some “thanks” can make communit... more >
How community-led initiatives can help save the housing shortage

19/06/2019How community-led initiatives can help save the housing shortage

Tom Chance, director at the National Community Land Trust Network, argues that community-led initiatives are a productive way of helping to solve... more >
Aberdeen's green transport fleet attracting international attention

19/06/2019Aberdeen's green transport fleet attracting international attention

Aberdeen City Council’s hydrogen spokesperson, councillor Philip Bell, highlights the Granite City’s determination to play a leading ... more >
A fifth of public sector workers have never received a thank you from the people they serve

13/06/2019A fifth of public sector workers have never received a thank you from the people they serve

A fifth of the country’s public sector workers say they have NEVER received a ‘thank you’ for doing their job as Public Service... more >

interviews

Artificial intelligence: the devil is in the data

17/12/2018Artificial intelligence: the devil is in the data

It’s no secret that the public sector and its service providers need to invest in technology to help make better use of their resources. Bu... more >
Digital innovation in the public sector: The future is now

17/12/2018Digital innovation in the public sector: The future is now

One of the public sector’s key technology partners has recently welcomed a new member to its team. Matt Spencer, O2’s head of public ... more >
New Dorset Councils CEO on the creation of a new unitary: ‘This is going to be the right decision for Dorset’

05/11/2018New Dorset Councils CEO on the creation of a new unitary: ‘This is going to be the right decision for Dorset’

The new chief executive of one of the new unitary authorities in Dorset has outlined his approach to culture and work with employees, arguing tha... more >
Keeping the momentum of the Northern Powerhouse

15/10/2018Keeping the momentum of the Northern Powerhouse

On 6 September, the biggest decision-makers of the north joined forces to celebrate and debate how to drive innovation and improvement through th... more >

public sector focus

View all News