Transcript Document

LG NSW – Regional Collaboration and Shared Services
April 2015
Donna Galvin, Executive Manager, WBC Strategic Alliance
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the provision of a service by one part of an
organization or group where that service had
previously been found in more than one part of the
organization or group. Thus the funding and
resourcing of the service is shared and the
providing department effectively becomes an
internal service provider. The key is the idea of
'sharing' within an organization or group.(wikepedia)
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What is currently done BY many….
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In the future is done by ONE…..
….FOR many…………
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1. MODEL
Entity – options and best fit
for us
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Governance arrangements
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Funding
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Location
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CEO – role & appointment
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Board – role & decision
making
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GM Advisory Group
2. SERVICE SELECTION &
BUSINESS CASE
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Future state of operating
model – vision/purpose,
objectives
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Methodology for service
analysis and selection
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High level analysis – first
cut
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Detailed business case –
ROI, Service Level
agreements and cost of
services
What MODEL ?
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Voluntary (Alliances – non binding)
Legal entity
- Corporation
- Cooperative
- Company limited by guarantee
- Incorporated Associations
- Joint venture
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Regional organisations (ROCs)
Joint production (eg rates processing)
Outsourcing
Council Controlled Organisations (New Zealand
model)
County councils
Joint
Organisations
JV Alliance Members’ Agreement
Central
Tablelands
Water
Cabonne
Shire
Council
Blayney
Shire
Council
Wellington
Shire
Council
New
Member
Council/
Rural
Council
New
Member
Council/
Rural
Council
Guarantee of $10 per Member Council
THE ENTITY – NAME TO BE CONFIRMED
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Appointed by Member
Councils under JV Alliance
Members’ Agreement
Board of Directors
General Managers’
Advisory Council
Chief Executive Officer (CEO)
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Shared Services Delivery
and Procurement
One Director to be appointed
by each Member Council,
preferably Mayors.
Ability to appoint up to 2
independent, external directors
Appointed by the Board
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Voluntary versus binding?
Formal (legal) versus informal?
Optimum number of partners?
“Like” minded council partners?
Depends on what you want to share and the
level of relationship and trust that will carry the
strategy forward
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Relevance of the service/function to the member
organisations and other councils
Financial and Efficiency gains to be achieved
Human Resources required to provide the service
or function and any potential industrial
implications
Risk Analysis
Capacity improvement to the member councils
Asset consolidation/reduction (eg. shared IT &
communications infrastructure)
Community and geographic considerations.
SHARED SERVICES INC??
VISION:
Enhance the capability and capacity of participant organisations
to deliver efficient, effective public services
PURPOSE:
Deliver sustainable, cost effective, quality public and support
services through a commercially focused cooperative business
model
STRATEGIC OBJECTIVES:
1. Release operational efficiencies through formal collaboration on service delivery
2. Release operational efficiencies by leveraging operational assets, fleet and
machinery
3. Attract, retain and develop employees to meet key skills areas
4. Re-use operational efficiencies to meet identified gaps in service provision
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Cost benefit analysis establishes case for change
Meets identified capability and capacity gaps
Enhances ability to attract and retain key skills
Utilises standard systems/process
Operations and benefits can leverage further
through increased scale and scope
There are existing shared arrangements
There is limited consequential impact on other
services
Preserves community employment in key areas
Service delivery is an established political priority
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Using the design principles we selected 20
functions in 3 service groups for analysis:
Strategic and support services (34.4 EFT)
– Financial management, accounts payable/receivable,
payroll, HR, ICT (support and infrastructure) asset and
fleet management, contract and tender management
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Specialist Services (8.2 EFT)
– Development assessment, PCA, Public health and
inspections and design
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Direct Field Services- (70.7EFT)
- water supply and water treatment, road
construction and maintenance
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Current functional structure of 3 councils
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FTE – position descriptions
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Cost of FTE
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Assets data, including utilisation, asset life, depreciation
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Financial data – income and expenditure, debt exposure, LTFP
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Performance data (hands up who has this??)
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Efficiency savings were identified in the 3 service groups by
centralising functions and having staff specialise.
The efficiencies come from specialisation and represent “part
positions”. Therefore all the functions in a service group
would have to “move” otherwise efficiencies won’t be
achieved…..this is going to be our greatest challenge. One
arm, one leg, …..
Currently assessing the ROI for the large change that would
be required to make those efficiency savings
The estimated savings is in context of maintaining current
EFT levels. There is additional opportunity if the strategy
included reduction in EFT………BUT, is there an appetite for
this at the moment? And what impact would that have on
service levels?
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Does the Alliance group have the scale for Shared
Services……OR do we need additional partners?
The next step is detailed business case – we have
established the case for change.
We need much more detail on current cost of service
delivery vs proposed model……….to be sure that
service delivery costs will be lower through a shared
service model.
Councils seldom have a clear picture on how well they are
performing prior to the proposed changes which means
they cannot properly determine how change will effect
their performance before and after the change
(Brian Dollery – review of NESAC)
All of the following are achievable but require a high level of
leadership , management and determination……..
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Industrial relations – moving staff to a company structure?
Moving staff to a different location?
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Governance arrangements of the new entity – need a binding
commitment to “buy” services from the new entity for a period
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Establishment and operating costs – the ROI may be 3 – 5 years
- the councils need initial funding to manage the transition and
fund the entity
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The future model for regional cooperation ?Joint Organisations
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Strong and sustained leadership and commitment from all
partners
On regional collaboration………….
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Embrace regional cooperation and do something with your
neighbours or broader LG community
Pick your partners well
Work on trust and relationship first before tackling major
change or transformation
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Define your shared vision for collaboration
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Resource it, drive it and get some early wins……..
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On Shared Services………..
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Ensure all partners are clear on the what shared services means ,
what the potential benefits might be (start with the end in mind)
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Base your decisions on a sound business case for change that
MUST include your ROI and clearly identifies that service delivery
will be more efficient and effective than it currently is
You will need strong sustained leadership and commitment –
this is long term transformational change – it is not a soft option
to avoid amalgamation
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Provide the resources to make it happen and manage the change
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Identify and manage enablers not necessarily in your control
eg Industrial, the Act, legal status, technology platforms etc
…“nice” is not enough.
A number of factors can limit the
ambition of local government to realise
the full savings potential of moving
to a shared service model –
the biggest obstacles are often political.
(Deloittes 2010)