The next generation in public services…..

March 15, 2013

The Strategic Plan for Next Generation Shared Services issued by the UK Government should be of immediate interest to service delivery agencies across the Irish public sector.

In it there is the acknowledgement of much learning since the introduction of the shared services initiative in 2004. The next Shared Services Programme is planned “to deliver a significant reduction in costs while raising the customer experience. It will look to achieve this through consolidation of volumes and services, standardisation of processes and leverage of IT, buildings and people assets.” In the process saving the UK Government some £600 million in hard cash.

The Strategic Plan is important reading as it sets out the lessons learned, the fact that expectations were not always achieved and that, in fact, in a number of instances, shared service initiatives actually cost the British exchequer a lot more than what was saved. So the Strategic is now more firmly based on a business case analysis which does not profile unrealisable savings into the cost structure.

The Strategy highlights the benefits of moving towards a shared services approach to service delivery but very much with a view to underpinning territorial organisation rather than a wholly isolated thematic approach. So it can deliver significant savings once the barriers and silos begin to break down and it does so through:

• a standard way of working across more customers, enabling greater staff synergies;
• fewer errors or types of errors resulting in fewer staff to ‘fix’ problems;
• greater customer income enabling greater investment in automation tools;
• the sharing of management expertise across many customers;
• greater volumes of business giving the leverage to obtain better prices from providers for the same level of service;
• shared systems across more customers resulting in lower expenditure on hosting, supporting and maintaining systems;
• common processes and systems, reducing the cost to support, maintain and upgrade these systems compared to unique and bespoke systems;
• Shared Service Centres having the scale to justify their own facilities away from expensive front-line locations;
• the ability to offer more opportunities to staff which should result in lower turnover and lower recruitment costs; and
• improvements in financial control and transparency.

Equally critical the UK Strategy focuses on the need for quality public services and recognises that quality and cost are not mutually exclusive where it comes to improving services. The Strategy wants to ensure that this is indeed the case by having:

• a focus on performance management through key performance indicators and outcome- based delivery;
• experienced providers delivering services that they have delivered for customers many times before;
• customer involvement in the governance of the SSC through customer forums and even shareholdings;
• the professionalisation of Shared Service Centre roles along with engendering a pride in being involved in the organisation by delivering customer service training alongside technical training; and
• consistent service through a single customer service management structure.

Moves towards similar models have become a feature of the overall effort to constrain Irish public service spending. It is very early in the Irish case to determine whether the proposed model will work, a point accepted by the relevant Minister, Brendan Howlin T.D. as he announced his own public service reform plans.

Nonetheless, the progress in rolling out the new Strategy in the UK should provide the Irish policy-makers with the opportunity to benchmark progress on this side of the Irish Sea. It will also provide the opportunity to share experience something which would be more than useful given the high level of experience in the UK.

There are clear examples of effective shared service delivery supported by active union engagement and partnership across the various tiers of government and the private sector in England. Learning from this could underpin the process in Ireland and perhaps help the avoidance of making the same mistakes as others, most notably in the UK but also in other countries.

Placing the citizen, as citizen and not just customer, at the heart of a move towards shared services is something clearly being learnt and now applied in Britain. Keeping a similar focus in Ireland would immediately underpin other policy initiatives in the Republic, most notably those in local government reform, rural development and the re-organisation of front-line services across the public sector.

The integration of the UK Strategy with moves towards community based reforms, budgeting and re-configuration of the local economic and planning process is also something of note as services move towards shared service platforms in Ireland. Most notably and interesting is the dynamic for public-private engagement which is beginning to bring some economic benefits to communities at the heart of the shared service process, an evident necessity in the Irish case.

Finally, if the process can develop as it is in the UK, Germany, Sweden and elsewhere across the OECD, it might actually delivery an improved public service along with real financial savings that are so clearly needed in Ireland.

Watch this space!