Val Earle considers why the current economic crisis might be the kick-start needed for real council transformation
Councils, like many other not-for-profit organisations, maintain reserve funds for times of crisis, and have financial strategies to make this money work harder for them through investments.
Some invest in bonds and other financial instruments, others in more physical assets, such as commercial property.
But both are causing problems across the UK, in the face of economic uncertainty.
Some authorities had saving plans intrinsically linked to their accommodation and property rationalisation strategies, designed to provide cash to the council by releasing capital from their property asset portfolio. But, with the current downturn in the UK property market, councils can no longer rely on this strategy of fundraising.
Despite the confirmation of increased public spending to address the current economic climate, the tough spending limits in the current Comprehensive Spending Review and increased demands for services, has meant councils are required to do more with less.
So, authorities now find themselves in a position where they need to focus on the transformation agenda to deliver real cost savings and efficiencies more than ever.
Now is a great time for authorities to reassess their situation. Local councils need to go over their spending programmes with a finer toothcomb to ensure scarce resources are focused on projects where efficiencies are one of the outcomes.
It has become critical for councils to adopt a strong programme management and governance approach to ensure that effort and resources are focused appropriately to achieve the desired end results. The challenges faced vary, depending on the size of authority.
A key transformational element for larger authorities is to gain greater value from their assets. Visionaries such as Nottingham City Council have taken the lead in reducing their departments’ carbon footprint, and removing duplications in departmental operations allowing substantial reduction of property portfolios.
Critically, authorities such as Nottingham have agreed local service outcomes, and are now examining or implementing dedicated change strategies and programmes delivering to targets.
The structural realignment of joining up back-office and front-office technology systems to deliver these projects, indicates the belief that the benefits of larger-scale change programmes outweigh the limited gains from incremental improvements for larger authorities.
This belief is also demonstrated by the Liverpool Direct service company, meeting local people's needs better, saving millions of pounds, and releasing a whole building previously groaning with paper filing systems, by setting up software-based administration through electronic document management and workflow.
Many councils have yet to develop comprehensive change programmes which are capable of shifting their service and business platforms decisively towards citizen-centric services.
Due to the current climate, and ahead of calls for councils to help their local businesses more directly, Birmingham City and Essex CC are exceptions to the rule, identifying the local economy's changing need and responding to it by offering financial services and support for their citizens.
Such examples demonstrate how the councils which have already made investments in resources, processes and technologies as part of the transformation agenda, are able to enjoy rapid deployment of new service models for the benefit of their communities.
Perhaps the biggest changes will come as district councils continue to move ahead in transforming their services. These authorities will be even more focused on driving value for money out of decreasing funds than larger, better funded counterparts.
They can move beyond balanced budgets to look at innovative ‘self-funding’ change programmes which align services to local demand while meeting funding constraints.
Working with trusted partners, councils should be demanding that suppliers demonstrate how their investment will pay for itself through meeting agreed financial targets – and thereby helping the authorities meet their own savings and efficiency targets.
Despite great examples of councils which have taken on board the transformation agenda, and are using the current climate as a driver to offer more innovative and cost-effective services, many barriers to transformation will remain the same for authorities throughout 2009, including:
l a lack of appreciation of risk associated with ill-prepared change programmes
l limited commercial expertise and programme management skills
l the loss of experienced staff from the public sector, as senior and middle managers reach retirement
Authorities’ objectives, ambition, resources, management skills and infrastructures vary considerably. However, their own strategic change abilities can be supplemented with knowledge and expertise from trusted partners with the in-depth understanding needed to engineer genuine change.
An increased focus on service transformation and driving cost efficiencies using this approach now will help authorities through these trying times, and set them up for longer term benefits. w
Val Earle is director of transformation strategy at Civica
Some invest in bonds and other financial instruments, others in more physical assets, such as commercial property.
But both are causing problems across the UK, in the face of economic uncertainty.
Some authorities had saving plans intrinsically linked to their accommodation and property rationalisation strategies, designed to provide cash to the council by releasing capital from their property asset portfolio. But, with the current downturn in the UK property market, councils can no longer rely on this strategy of fundraising.
Despite the confirmation of increased public spending to address the current economic climate, the tough spending limits in the current Comprehensive Spending Review and increased demands for services, has meant councils are required to do more with less.
So, authorities now find themselves in a position where they need to focus on the transformation agenda to deliver real cost savings and efficiencies more than ever.
Now is a great time for authorities to reassess their situation. Local councils need to go over their spending programmes with a finer toothcomb to ensure scarce resources are focused on projects where efficiencies are one of the outcomes.
It has become critical for councils to adopt a strong programme management and governance approach to ensure that effort and resources are focused appropriately to achieve the desired end results. The challenges faced vary, depending on the size of authority.
A key transformational element for larger authorities is to gain greater value from their assets. Visionaries such as Nottingham City Council have taken the lead in reducing their departments’ carbon footprint, and removing duplications in departmental operations allowing substantial reduction of property portfolios.
Critically, authorities such as Nottingham have agreed local service outcomes, and are now examining or implementing dedicated change strategies and programmes delivering to targets.
The structural realignment of joining up back-office and front-office technology systems to deliver these projects, indicates the belief that the benefits of larger-scale change programmes outweigh the limited gains from incremental improvements for larger authorities.
This belief is also demonstrated by the Liverpool Direct service company, meeting local people's needs better, saving millions of pounds, and releasing a whole building previously groaning with paper filing systems, by setting up software-based administration through electronic document management and workflow.
Many councils have yet to develop comprehensive change programmes which are capable of shifting their service and business platforms decisively towards citizen-centric services.
Due to the current climate, and ahead of calls for councils to help their local businesses more directly, Birmingham City and Essex CC are exceptions to the rule, identifying the local economy's changing need and responding to it by offering financial services and support for their citizens.
Such examples demonstrate how the councils which have already made investments in resources, processes and technologies as part of the transformation agenda, are able to enjoy rapid deployment of new service models for the benefit of their communities.
Perhaps the biggest changes will come as district councils continue to move ahead in transforming their services. These authorities will be even more focused on driving value for money out of decreasing funds than larger, better funded counterparts.
They can move beyond balanced budgets to look at innovative ‘self-funding’ change programmes which align services to local demand while meeting funding constraints.
Working with trusted partners, councils should be demanding that suppliers demonstrate how their investment will pay for itself through meeting agreed financial targets – and thereby helping the authorities meet their own savings and efficiency targets.
Despite great examples of councils which have taken on board the transformation agenda, and are using the current climate as a driver to offer more innovative and cost-effective services, many barriers to transformation will remain the same for authorities throughout 2009, including:
l a lack of appreciation of risk associated with ill-prepared change programmes
l limited commercial expertise and programme management skills
l the loss of experienced staff from the public sector, as senior and middle managers reach retirement
Authorities’ objectives, ambition, resources, management skills and infrastructures vary considerably. However, their own strategic change abilities can be supplemented with knowledge and expertise from trusted partners with the in-depth understanding needed to engineer genuine change.
An increased focus on service transformation and driving cost efficiencies using this approach now will help authorities through these trying times, and set them up for longer term benefits. w
Val Earle is director of transformation strategy at Civica
