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Transforming public services

Source: Public Sector Executive May/June 12

In the run up to his presentation with Sefton Metropolitan Borough Council at the National Outsourcing Association’s 25th Anniversary Conference, Michael Jones, partnership director for NAO member arvato’s relationship with Sefton Council, talks about current challenges in public sector outsourcing and his predictions for the industry.

Current challenges in public sector outsourcing 

In the current economic climate, with even sharper cuts to council budgets, the focus is on the transformation of services and new models of service delivery.

Increasingly, outsourcing partners in the public sector need to recognise they are in it for the long-term. The goals and objectives of a client can look completely different towards the end of a partnership than they did at the outset. Today, the most successful partnerships are those that are able to adapt flexibly to changing priorities and financial pressures.

A true sense of partnership

With Sefton Council, like many of our client relationships, we looked at how we could build on and go beyond our initial contractual commitments. Specifically, we jointly focussed on solutions that would help improve services whilst supporting the council to meet its financial targets, by generating additional savings as well as new income. This meant that our 10-year partnership, which started in 2008, delivered an additional £1.6m of contributions in 2011/12 on top of the 10% day-one savings. This includes £600,000 of ‘one-off’ savings, £500,000 in additional income and to-date £500,000 of annual, sustainable savings.

Public sector outsourcing predictions

Channel shift – Channel shift towards selfservice will continue to be a major trend over the next twelve months in order to meet budget challenges and empower citizens. As councils realise that they have done all they can to streamline suppliers, they now need to look at what can be done to better manage and influence citizen demand for services. Customer insight and citizen understanding are key to ensure councils deliver services and engage in the way that best suits citizens. For example, channelling more transactions through the internet or other new media channels and devices for suitable demographic groups will yield cost savings and free up time to prioritise services for citizen groups that require more support or one-to-one contact.

Shared responsibility as well as shared service – As public sector reforms continue, intelligent, flexible framework models need to be introduced to enable councils to take ownership of not only how they deliver longterm benefits for their own organisation but take advantage of bigger knowledge pools, either through private sector partners or other councils, or both. Through shared services, councils can not only drive standardisation and achieve economies of scale and efficiencies, but also share best practices and gain the external insights needed to transform services.

Up-skilling to support transformation – Finally, we will continue to see more sustainable, effective working practices. This will require a major review of skills available within existing teams to meet changing demands, focus on areas for growth and increase productivity while maintaining a continued high level of service to citizens. Facilitating lean thinking through introducing skills such as Six Sigma as well as robust project management training will enable employees to take a more strategic approach to improving and re-engineering working processes.

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