Transcript Embedding VFM

Embedding VFM
If VFM is now really about business effectiveness,
what are the kind of behaviours, processes &
practices you need to embed it in your
organisation?
Achieving VFM: a model
Let’s start with a model* of how you might
achieve VFM….
*HouseMark work in progress
1.Purpose
5.Right
outcome
Achieving VFM
and business
objectives
4.Right
delivery
2.Right
activities
3.Right
assets
Efficiency
implementation
Purpose – basis for an
organisational definition of VFM
The board should define VFM based on:
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clear understanding of what they are in business
for – purpose & objectives - commercial head,
social heart
reconciliation of the value perspective of
different stakeholders, including customers
reconciliation of competing priorities across
activities
context such as PEST, client group, geography
1.Purpose
5.Right
outcome
4.Right
delivery
2.Right
activities
3.Right
assets
The provider’s VFM definition is
likely to amount to the
achievement of its objectives in
the most cost effective way
possible
1.Purpose
Right activities
Engage in the right things - business
activities - to achieve objectives.
5.Right
outcome
2.Right
activities
The board’s strategic direction drives:
• the right mix of activities or products, eg
social rents, affordable, supported, care,
regeneration, tenant services
• the right allocation of resources between
these activities - reconciled across
development, stock improvement, front-line
services, etc
4.Right
delivery
3.Right
assets
Right assets
Invest in inputs – housing assets & delivery
model - to achieve objectives. This about
economy:
1.Purpose
5.Right
outcome
2.Right
activities
• invest in the right physical assets of the right
standard in the right places for the right cost
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coherent asset management - understand return on
assets and the financial, social, environmental
benefit of any investment
invest in the right delivery model for the right
cost
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about service delivery and back office functions
about investment in people, offices and equipment….
… and the procurement of goods/ services from
others ….
…including consideration of alternative delivery
models…
..but you might have services to sell too….
4.Right
delivery
3.Right
assets
Right delivery
The right delivery practices to achieve
objectives - adopting efficient and effective
operational practices - doing things right:
1.Purpose
5.Right
outcome
2.Right
activities
• efficient operations:
• smart business processes
• people (workforce management) – right
skills, staffing levels, HR practices,
sickness management, etc
4.Right
delivery
3.Right
assets
• effective business practices:
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performance management
risk management
financial management & cost control
income management
ability to join things up internally & externally (teamwork & partnerships)
1.Purpose
Right outcome
• if previous steps undertaken correctly
the desired outcomes should be
achieved… not by magic, by
management
• evaluate effectiveness - have the
financial, social, environmental and
service quality returns been achieved?
… including efficiencies/surpluses
5.Right
outcome
4.Right
delivery
2.Right
activities
3.Right
assets
…. the model assumes a wider ‘take’ on
VFM than previously. What are the
behaviours, processes & practices that
together embed ‘total’ VFM?
To help marshal your thinking, a cultural
web….