Report For Stoke–on-Trent University Quarter

Ed Parker Associate Director

Turner & Townsend 63 Church St Birmingham B3 2DP

t: +44 (0)121 2621100 e: [email protected] w: turnerandtownsend.com

Shared Services Feasibility Study April 09

Stoke University Quarter Shared Services Feasibility Study

Contents

1

EXECUTIVE SUMMARY

1

2

APPROACH

7

3

LEARNING

10

4

SERVICE PROFILING

16

5

OPTIONS IDENTIFICATION

25

6

EVALUATION

30

7

OPTIONS APPRAISAL

82

8

NEXT STEPS

96

Rev

Originator

Approved

Date

0

Malcolm Roe

Ed Parker

8th December 2008

1

Malcolm Roe

Draft for Comment

13th January 2009

2

Ed Parker

Final Draft

16th January 2009

4

Ed Parker

Paul Richards

31st March 2009

© Turner & Townsend Management Solutions. All rights reserved January 09. This document is expressly provided to and solely for the use of Stoke-on-Trent University Quarter and must not be quoted from, referred to, used by or distributed to any other party without the prior consent of Turner & Townsend Management Solutions who accept no liability of whatsoever nature for any use by any other party.

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University Quarter Shared Services Feasibility Study

1 1.1

Executive Summary Introduction Turner & Townsend were commissioned by The Staffordshire University, supported by a grant from the Higher Education Funding Council for England (HEFCE), to undertake a feasibility study for the development of shared services between the three academic partners in the Stoke-on-Trent University Quarter. The project was overseen by the University Quarter Education Facilities and Services Group (EFSG). This is the strategic group responsible for the development of the education facilities within the Stoke University Quarter Regeneration Project. The senior responsible owner for this project was Paul Richards, Deputy Vice Chancellor of Staffordshire University. The overall conclusion of this report is that there is potential for the academic partners within the Stoke-on-Trent University Quarter to secure sustainable efficiency improvements by working more closely together and developing approaches to sharing services as the University Quarter develops. The academic partners operating in the University Quarter have concluded that collaborating in the provision of compatible services will achieve either one or a mixture of the following benefits:


Cost reduction




Performance improvement




Making the service more customer focused

As construction commences for shared buildings there is a unique opportunity for the partners to develop innovative approaches to share services to improve the experience of students, maximise opportunities for progression and to achieve cost savings.

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1.2

Key Findings a) Historically there has been little or no formal sharing of services between the partners. There is evidence of a number of informal arrangements, and the benefits from these have already proven their value. For example there has been some collective procurement activity and the two colleges work together to provide consistent pre-entry advice. The physical changes in location arising from the University Quarter programme mean that the time is right for driving through a more collaborative approach to delivering services. b) The institutions are moving at different speeds, the build for the Further Education College is already underway and decisions have already been made that could influence the ability of the partners to effectively share facilities in the future. This is of particular concern as the client populations of the three institutions are so diverse. c) Although plans are quite advanced for the new buildings for the University Quarter to date there has been little progress on developing approaches to sharing services across the new buildings and shared facilities (e.g. grounds maintenance, parking and security management). The lead organisations in the development of each building within the new quarter are undertaking different approaches to their building design and IT integration. This approach prevents the identification of opportunities for potential sharing services and infrastructure across SUQ in the future. d) The academic partners have shown a sustained strategic commitment to working together, this is demonstrated by the engagement of the College Principals and the Deputy Vice Chancellor of the University in this project. e) Workshops attended by senior staff indicated a desire to collaborate at a local level (i.e. a local service run by local people). Considering the high levels of local unemployment, the need for strong community involvement and given that VAT may be irrecoverable on outsourced shared services, a pragmatic approach to sharing services, starting at a local level and then re-considering strategic options as the services mature would seem appropriate. f)

Throughout the project there has been a lack of detailed financial data to analyse costs of individual services which has impeded our ability to undertake detailed options appraisal. As the institutions continue to work together this lack of detailed information will present a significant barrier to management being able to make informed decisions and improve efficiency. There is limited evidence that the institutions undertake benchmarking or cost analysis, this implies that opportunities to learn from best practice to improve efficiency are being missed.

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g) There is a shortage of Crèche / Childcare places for each of the partners, and this could present an opportunity to meet the need through the development of a shared service. In addition to this, when the 6th Form College moves to its new buildings, the existing facilities at Fenton Manor may prove to be too far away to be viable. h) Stoke FE College have in place a robust training and development plan for their IT technical staff. The University and Sixth Form Centre do not have such a robust process. Given all organisations are moving toward a Cisco / Windows based architecture, it may be viable to have a central training function for all organisations. This would also help develop relationships between key staff. i)

Users from all organisations will be using the same computers in shared new buildings. The organisations could either create a single sign on (SSO) policy or authenticate users against different independent domains. The benefits of a SSO policy should be evaluated and a technical solution created, implemented and tested to ensure functionality required by each organisation is achievable.

j)

The Health, Safety and Environment role for each establishment is included in the Estates Services departments. The role tends to be one of a specialist nature and the pooling of skill / knowledge would benefit all the partners and may provide opportunities to reduce costs.p

k) All partners appear to experience the same types of problems with parking management. With new buildings taking over spaces previously used for parking, the problems will become more exaggerated. Sharing services in this area will provide a standard approach to policy and optimising use. l)

There is a lot of common ground for the Security Services in all three establishments, in that they all have an in-house service during the day and an outsourced service at night. Benefits from sharing this service will arise from economy of scale (cost efficiencies) and commonality of approach (which will become more important for the shared buildings).

m) Procurement in each of the partners seems is reasonably robust, however a more collaborative approach, using best practice Procurement and Sourcing methodology, will deliver benefits in the short term. These benefits can then be used as a platform to explore further options to improve the delivery model in the future. n) Given the infancy of the approach to sharing services in the new build areas of SUQ, the creation of new workstreams, focussed on how operational management of the new sites will work, would be beneficial; particularly in the areas of ICT / communications / infrastructure and facilities management.

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1.3

Recommendations Shared services are the logical conclusion in a co-located campus such as the Stokeon-Trent University Quarter, especially within the context of current financial pressures and the need to deliver efficiency savings. Our key recommendations are: 1. Develop the role of the Education Facilities and Services Group (EFSG) to drive the effective sharing of new and existing facilities. There should be an urgent focus to ensure that the new buildings will deliver their potential to transform the education experience for the student of all three institutions. 2. The EFSG should lead a defined change programme based on the OGC Management Successful Programmes approach that is focused on delivering the business benefits that will result from the completion of new facilities. 3. The partners should re-affirm commitment to the University Quarter project at Strategic Governance level to provide a clear mandate to change ways of working and develop joint approaches as the University Quarter develops. 4. The EFSG should develop an engagement strategy for managers, staff & students, outlining the purpose of the changes, why the change is required the plan for implementation and the part that stakeholders will play. 5. This Feasibility Study has identified several areas where there are significant opportunities for sharing services in the medium and longer term. In the short term the University Quarter academic partners should take forward formal collaboration towards developing shared services for the following services:


Crèche / Childcare – develop shared facilities




Health & Safety Management – consider shared service




Parking Management – develop shared service




Security Services – develop shared service




ICT – develop common architecture to facilitate sharing facilities




Procurement – collaborate more formally to identify and deliver savings

6. The ESFG should commission an Outline Business Case for shared childcare facilities, investigating the demand, location and sources of funding available.

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1.4

Implementation Timescales The following actions are recommended over the coming 12 months to build momentum and build on the shared services:


Confirm Shared Services projects to be taken forward:

March 2009




Formalise remit and structure of EFSG:

April 2009




Complete shared review of procurement spend:

May 2009




Agree remit and Project Initiation Documents for projects:

May 2009




Establishment of project teams for Shared Services:

June 2009




Develop detailed financial information for projects:

Sept 2009




Detailed scoping of each service requirements:

Sept 2009

Delivery of Quick Wins:


Outline Business Case for Nursery / Crèche facilities:

April 2009




Shared approach for Health & Safety:

June 2009




Approved Plan for shared Nursery / Crèche for SUQ:

Dec 2009




Approved Plan for shared development of IT:

Sept 2009




Implementation of shared service for security & parking:

March 2010

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1.5

Benefits Realisation The absence of detailed financial and staff data has restricted analysis of the current service provision. Whilst benefits are not empirically quantifiable at this stage, there is evidence that the following benefits should be achievable:


Learning and efficiency from sharing best practice




Standardising and improving processes




Increased efficiency and effectiveness (value for money)




Increased flexibility




Standardisation




Better information and data




Improvement in performance and measurement




Enhanced capability




More focus on student needs

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2 2.1

Approach Brief Following the publication of the Gershon Review in July 2004, the Department for Education and Skills (DfES) agreed a target of realising annual efficiency gains of at least £4.3 billion by 2007-08 by:


reducing the number of civil servants in the central department




improving procurement of goods, services and new school buildings




increasing productivity in schools, colleges and higher education institutions




reducing regulation

It has been estimated that universities spend around £700 million on Human Resources and Finance each year, and considerably more on other support services. There is a presumption in current thinking that sharing such services with other organisations will release efficiencies by standardisation, simplification and sharing, deliver better value for money and therefore enable more to be spent on ‘front-line’ services. HEFCE invited expressions of interest from higher education institutions in leading feasibility studies on shared services. The University Quarter education partners responded to this by seeking support to commission a feasibility assessment to:


Examine the potential for sharing of services




Create a vision for shared services




Identify how to progress in developing shared services.

While the work carried out has enabled recommendations to be made to move shared services forward it should be noted that the absence of detailed financial information has meant that it has not been possible to develop detailed financial analysis to support the business case, however detailed analysis of the short listed services has been completed and a strategy for achieving rapid progress has been developed.

2.2

Exclusions The University Quarter programme has separate workstreams considering optimisation of the shared facilities and how best to deliver the curriculum in the new buildings; these are out of the scope of this study. This study also excludes the

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sharing of services between two partners, although there are areas where this could be considered.

2.3

Value Improvement Process The approach delivered by Turner & Townsend has been developed from best practice in the public and private sector and incorporates guidance from both the Office of Government Commerce (OGC) and the Cabinet Office. Experience with both public and private sector organisations has led to the development of Turner & Townsend’s proven methodology and framework – Value Improvement Process (VIP).

Core to this approach is the combination of fact based analysis and engagement with managers, staff and service users. This approach develops a consensus for change based on the head (the analytical outcomes of evidence based evaluation and options appraisal) and the heart (participation in workshops evaluating options on the basis of cultural fit, improvements in services and risks). Throughout the project a series of workshops, interviews, briefings and group discussions were held with members of the EFSG and senior managers. In addition service specialists conducted a series of joint interviews with the partners’ senior management staff. These interviews were used as the basis of the evaluation section of the report and provided:


Understanding of the basis for change and establishing the areas for sharing,




understanding the cost basis for each service and assisting in the identification of synergies and cost savings, and

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evaluating the potential for shared services to succeed.

Following Office of Government Commerce (OGC) best practice guidelines, a business model based on splitting support functions into three tiers. Tiers one and two correspond to services which need incumbent expertise from each partner to run and manage them, and tier 3 represents those which could be shared. Workshops with the partners categorised the services accordingly and the level three services were further examined to produce a list of services which had the greatest potential for sharing. Each of the services on this reduced list was evaluated through interviews with key staff. The information gathered was then subjected to an options appraisal process to develop the final recommendations.

2.4

Governance The project governance structure was established as below. As the project developed changes were discussed with the Senior Responsible Owner (SRO) and agreed by EFSG.

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3 3.1

Learning Purpose The purpose of this section is to capture the key lessons learnt from engagement with senior managers as part of the feasibility study and to capture learning from best practice and the successful implementation of other change programmes.

3.2

Strengths The interviews with managers and a workshop with the EFSG resulted in the following strengths being identified:

3.3




A clear shared understanding of the vision for the University Quarter and the implications for the three academic institutions at the strategic management level.




Strong relationships have been formed and are improving as managers work together to develop common solutions.




The wider partnership is growing and is strong with valuable engagement from Advantage West Midlands and Stoke-on-Trent City Council.




There is mutual support and understanding of context across all organisations.




Existing history of partnership working is providing confidence that future opportunities will be developed.

Challenges At the same time the partners recognise that there are significant challenges in developing the University Quarter and a shared service model:


Institutions are keen to preserve their individual identities which requires balancing the advantages of collaboration with the preservation of unique cultures and distinctive offerings




There is competition for students at the margins




There is limited appetite for sharing entire services, however, there is strong confidence around: a) Sharing knowledge and good practice b) Standardising and improving processes

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c) Partial sharing of services where risks are manageable and benefits are significant.

3.4




There is currently a lack of detailed financial and staff data to support benchmarking, performance improvement and decision making.




Service offerings differ across all partners and student surveys indicate preference for maintaining status quo.




The majority of services are currently report being stretched to capacity.




The fragility of the local job market is a concern when considering outsourcing.




Student surveys indicate a reluctance for students to go to different campuses (even within easy walking distances).

Resistance to Change within the University Quarter Senior managers recognised that there is resistance to change from staff. Reasons cited for this include:


A perception that proposed changes ‘do not stack up’ (‘If it ain’t broke’…)




Fear of loss of control, and concern for the future




Worry that performance may be affected




Concern at working in new ways outside established norms and ‘comfort zone’

Section 7 addresses the need for change. The senior managers identified the following factors as being critical to overcoming resistance so that the majority of staff understand the context and the required changes:


Clear purpose and vision so that staff and stakeholders understand the context and purpose of the change




Strategic intent – ‘snappy’ so that staff at all levels are able to succinctly summarise the purpose of the change




Acknowledge ambiguity and that not everyone will benefit from the change, as this is crucial to retain trust

This project only engaged with senior managers. A general observation is that strategic management are committed and are role modelling partnership behaviours,

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and that at an operational level there are already some good examples of collaboration. However some resistance was encountered from managers who were at times reluctant to prioritise meetings and provide the level of information requested. This suggests that engaging senior staff is crucial to success. These findings are reflected in the diagram below showing how resistance can be experienced in an organisation that is failing to implement change.

This pattern can be countered with structured and open two way communication as typified by the 4 P model below which requires staff and key stakeholders to be effectively engaged so that they can clearly articulate the following:


the Purpose - why the change has to happen




the Picture - what is happening at the moment




the Plan - step by step progress and what will be different




the Part - what part staff and stakeholders play in moving forward

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3.5

Key Learning from the Project Reviewing the project as a whole the following key learning points have been identified:

3.6




Strategic commitment to working together and shared enthusiasm and commitment to the UQ project has not yet translated to operational level




Institutions moving at different speeds so that agendas are not yet strategically aligned and not yet co-ordinating key areas of potentially shared operations – eg IT, space planning, access control which presents a significant risk to the project




Lack of detailed financial data to analyse costs of individual services which meant meaningful cost analysis and benchmarking was not possible

Making it Happen John Kotter (1995) developed a model, which has subsequently been widely used and found to be effective to support management teams implementing strategic change. The model identifies 8 elements that underpin the delivery of a successful change programme:


Sense of Urgency




Form a Powerful Guiding Coalition




Create a Vision




Communicate the Vision




Empowering Others to Act on the Vision




Planning for and Creating Short-Term Wins




Consolidating Improvements and Producing Still More Change




Institutionalizing New Approaches

Based on Kotter, Why Change Efforts Fail, Harvard Business Review, 1995

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3.7

Programme Management Approach Programme management provides the tools to enable the co-ordinated management of a portfolio of projects that change organisations to achieve strategic benefit. Programmes are initiated to realise benefits through change and differ from projects because they focus on the delivery of strategic benefits (improved service, reduced costs) rather than delivery of specific outputs (a new building). A programme enables organisations and partnerships to:


to do things differently




to do different things




to do things that will influence others to change

A programme management approach supports organisations to achieve:


3.7.1

Improved Outcomes: the result of change, normally affecting real-world behaviours or circumstances.

Benefits of Programme Management Programme management provides a framework for the partners to:


Plan & implement required changes




Focus on strategic objectives




Manage risks




Improve control




Deliver smooth transition to new ways of working




Efficiently manage (shared) resources




Achieve real business benefits




More efficient co-ordination and control of the often complex range of activities

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3.7.2

OGC Managing Successful Programme A widely used programme management approach in the public and (increasingly) private sector is the OGC Managing Successful Programmes approach. The approach identifies critical governance themes (the outer ring), the transformational flow (the central flow chart). The approach is illustrated below:

     

Critical Success Factors Scope of Programme Quality Quality Process Configuration Management Reviewing & Assessing Quality Quality Management Strategy & Plan  Information Management  Strategy & Plan  Differences between programme & t project lit y e n

Identifying /9 a% 11 1 % Programme 9 1/

11

1 /9

%

Establish

Closing a Programme

11

1 /9

P la n n in C o n tr g & ol      

Programme Plan Resource Management Strategy and Plan Programme Control Project Control Planning and controlling transition

Review & Prepare

11

% 11

1 /9

%

ig n n t D es B lu e p ri v e ry li e &D

1 /9

%

 Nature of stakeholder engagement and role of leadership  Leadership  Business Change Management  Communications with projects and other programmes  Steps involved in stakeholder engagement

%

B R en e e an alis fits ag ati em on en t

s es sin Bu ase C

11

Realising Benefits

% 1 /9

1 /9

M

Delivering the Capabilities

rship & Leade older Stakeh ement Engag

Defining a % 1 /9 1 1 Programme

11

 Genesis of the Business Case  The Business Case  Reviewing the Business Case  Managing the Business Case

 Programme Vision  Characteristics of good Vision Statement  Developing & Maintaining the Vision Statement

a tio n

g agin Man ches ran the T

Ris k Ma & Issu nag em e ent

11

O rg a n is

n io is

Principles of Risk Management Risk Management Process Risk Management Strategy Risk Management Assurance Issue Resolution Strategy Issue Resolution Process Change Control

Change Team Programme Office Additional Governance Roles Implementing & Managing Programme Organisation

V

      

a m Q u ge a n a M

   

 Blueprint Design  Designing Blueprint Delivery  Evolution and refinement of the Blueprint

         

BRM & Change BRM & Strategy Outcome relationship modelling Benefits Management Strategy Benefits Mapping Benefits Profiles Dis-benefits Benefits Realisation Plan Benefits Realistaion Process Change readiness

Adapted from MSP 2007

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4

Service Profiling

4.1

Purpose The purpose of the service profiling exercise is to gain a high level overview of the support services offered across the three institutions. There are two primary objectives for the development of shared services within the University Quarter, improving the quality of the educational experience and delivering efficiencies resulting in reduced costs. To identify the scope for achieving these objectives it is necessary to develop a shared understanding across the partners of the support services currently provided to staff and students working within the University Quarter. This section of the report outlines the context for the Shared Services Feasibility Study, considers the current (‘As-Is’) situation and includes a high level analysis of costs.

4.2

Context The University Quarter is a key regeneration project for Stoke-on-Trent and North Staffordshire as a whole. The overriding mission of the Quarter is education-led regeneration, designed to significantly raise the achievement of higher level skills and qualifications in the City, making the City a more attractive and competitive location for inward investment. The vision of the University Quarter is:“The University Quarter in Stoke-on-Trent will generate a thriving knowledge economy that is globally connected leading to sustainable prosperity and an ambitious and dynamic community. It will create an integrated learning experience, focussed upon creativity, skills and employability, promoting participation and progression”. The University Quarter programme combines the physical regeneration of a rundown area of the City Centre with an initiative by educational partners working together in a unique partnership to raise educational expectations, aspirations and attainment within the local area. The education partners are: •

Stoke-on-Trent Sixth Form College

•

Stoke-on-Trent College

•

Staffordshire University

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Within the programme a number of projects have been identified and these will be developed over the coming years designed to promote economic, social and physical regeneration of the sub-region. They have been selected for their ability to support the region’s economic development in line with the North Staffordshire Integrated Economic Development Strategy as well as the curriculum strengths of the educational partners. The proposed shared facility projects are:


Knowledge Hub




Science Centre




Media Place




Sports Village




Performing Arts & Music Centre

The following map identifies the current locations of the educational partners:

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4.3

Shared Services Definition Definitions of shared services vary. Typically they describe a model of providing services (not just so-called “back-office” services) in a combined or collaborative function, sharing processes and technology. In the private sector this is usually within the same group of companies, but in the public sector it will most often be between separate entities. The most sophisticated models involve establishing a completely new organisation, run and managed as an autonomous business. For the purposes of this report, we have adopted the widest possible definition of shared services, focusing not so much on the structure or governance arrangements, but rather on all areas where the partners could co-operate in the delivery of services and in sharing information and skills.

4.4

As-Is Model During the Service Profiling stage, the main services for each of the partners were investigated and compared against each other to identify their similarities. An ‘As-Is’ model, designed using the best practice advice on shared services from the Office of Government Commerce (OGC) and the Cabinet Office, was developed to record the findings of this stage. The model categorises all services in terms of three tiers. Tiers 1 and 2 represent the services which need implicit knowledge and experience to operate, and which would not be suitable for sharing. Tier 3 corresponds to those which are of a more generic nature and which could be considered as candidates for sharing. This model provides an accurate representation of the entire services estate, and if kept up-to-date, can also be used for future initiatives.

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4.5

Initial Service Profile The initial Service Profile is illustrated below:

Finance

HR

ICT

Tier 1 Management Policies Audit Planning Process Balanced Scorecards Allocations Tier 2 Specialist Support Mgt accounts Business cases Budgeting Forecasts Consolidated reports Tier 3 Administration Supplier mgt Routine reporting Data integrity Accounts payable Accounts receivable Asset register Procurement Purchase order processing T&S Processing Cash management Debtor / creditor control Project accounting Tax accounting Specialist Procurement Revenue collection Payroll admin Tier 1 Management Policies Diversity Performance mgt Pay & Benefits Training Industrial relations Organisation design Board effectiveness Leadership development Tier 2 Specialist Support Workforce planning Absence Mgt Performance mgt Training plan Induction Training admin Succession planning Communications Analysis / reporting Advice to employees Trend analysis Tier 3 Administration Benchmarking Recruitment Exit processing Pensions admin Pay & benefits recording Moves & promotion admin HR IT expertise Reporting Occupational Health Counselling Tier 1 Management

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In-House?

Improving

Established

Performance Monitoring

Constraints

Student Focussed

Current Performance

Shared already

Geographical Restriction

Staff Cost (£k)

Non-Pay Costs (£k)

Non Teaching Staff

Staffordshire University

University Quarter Shared Services Feasibility Study

Legal services

Marketing

Facilities mgt

Student Services

Key:

Application development Disaster recovery Tier 2 Specialist Support Service management Data centre services Tier 3 Administration Governance & Assurance Network Management Desktop hardware Desktop support Desktop software MFD's / Printers Specialist needs Install, moves, add or change ICT Training Telecoms Call-centre support Technical consultancy Video conferencing Application support Tier 3 Administration Public Liability Claims Procurement / Contracts Tier 3 Administration Hospitality & Events European students Publicity Printing Tier 1 Management Buildings Maintenance Waste Mgt Tier 3 Administration Electricity Gas Water Buildings Maintenance (delivery) Cleaning Parking Mgt Security Document Archiving Creche / childcare Reprographics Health & Safety Management Groundskeeping Library Services Sports Facilities Travel Planning Catering Porterage Tier 1&2 Strategic/Specialist Student Union Facilities CV generation Support & Progression Outreach teams Grants / loans Employer links Tier 3 Administration Job Hunting Advice on FE/HE options Admissions Exam Results Record Keeping Councelling & Suppport Chaplaincy Disability Support Careers / Employment Ground Sharing expertise Pre-entry Advice

Geographical Restriction Shared already

N - No restriction, could be anywhere in country; L - Must be in University Quarter campus; R - Restricted, must be at specific locations. U - Unitary (not shared); O - Outsourced (external provider); J - Joint Venture; S - Strategic Partnership (i.e. Ucas); L - Lead department (Pay by use); J - Joint initiative (Local shared service)

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4.6

Amended Service Profile Information The partners agreed that the initial service profile template was too burdensome to complete. The feedback was that the information required to complete the profile was not available at the appropriate level of detail. The profile was instead used as the basis for a discussion with senior managers over which areas of support services would be most appropriate to develop the potential for shared services. The benefit of this approach was that it enabled specialists to focus efforts on fewer specific areas; the consequence was that there is a lack of quantitative analysis to support the selection of the areas that became the main focus of the feasibility study.

4.7

Financial Analysis

4.7.1

Overview The financial information provided by the three partners was high level and is summarised below:

College

Expenditure (£k)

Non-Teaching Staff Costs Non-Pay Expenditure Premises Transport Supplies & Services Other Misc Costs

Total Costs Student Numbers Staff Numbers

Sixth Form

University

12,368

2,162

27,667

2,171 3,760 2,317 5,553 13,419 8,650 1,001

1,794 534 5 1,080 175 3,956 1,800 200

33,957 5,659

67,283 19,106 1,778

A critical factor is the difference in scale of the three organisations, with the University being more than ten times larger than the sixth form and more than twice the size of the Further Education College. The implication is that there could be significant economies of scale from combining activities between Stoke College and the University and that the sixth form could leverage significant economies of scale by using services provided or procured by the two larger partners.

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Staff Costs The following chart shows the average cost of each member of staff employed in the provision of support services. It indicates that the 6th form pays more than the college.

Overall Average Staff Cost

30 25 20 £k 15 10 5 0 College

6th Form

University

The highest staff costs are associated with the university and the following chart breaks this down by service:

College

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6th Form

Disability Support Careers / Employment Ground Sharing Pre-entry Advice

Chaplaincy

Catering

Porterage

Creche / childcare Groundskeepi ng

Security

Parking Mgt

Cleaning

Buildings Maintenance

IT

40 35 30 25 20 15 10 5 0

Counselling & Support

Average Staff Cost by Service

Procurement

4.7.2

University

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University Quarter Shared Services Feasibility Study

From this chart it would appear that the costs are comparable for most services, however, Counselling and support, disability support and pre-entry advice show significant differences, and would benefit from further investigation. Staffing Levels As outlined above the partners differs in size, the following chart provides a comparison of the equivalent number of students serviced by each staff member (total student headcount divided by number of staff):

Students per Staff Mamber

College

6th Form

Catering Counselling & Support Chaplaincy Disability Support Careers / Employment Ground Sharing expertise Pre-entry Advice

Porterage

Security Creche / childcare Groundskeeping

Parking Mgt

IT Buildings Maintenance Cleaning

4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 Procurement

4.7.3

University

From these two charts the following areas would benefit from further investigation:


Economies of scale in IT and procurement




Procurement staffing levels for the College (apparently high staffing levels)

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4.8

Output of Service Profiling The output of the service profiling was a facilitated workshop reviewing the activities in the seven core support areas identified below to select those suitable for further investigation.

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5

Options Identification

5.1

Purpose The purpose of this stage is to group support services from across the partner services and to identify possible models for the future delivery of the shared support services. The output is a short list of services to be evaluated in detail at the next stage of the process.

5.2

Shared Service Models Service provision is currently fragmented. Predominantly each partner delivers their services independently of the other partners. The following diagram shows the transformation anticipated as a result implementing shared services:

Each of the existing services for the partners has been modelled and activities categorised as 1, 2 or 3.

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University Quarter Shared Services Feasibility Study

5.2.1

Models for Consideration This section summarises advice from the Institute of Public Finance (IPF)1 on the models typically used for sharing services in public sector organisations. The complete list of options were reviewed in workshops and the partners excluded some options (indicated by cross) as being unsuitable on the grounds that they presented a significant risk and unmanageable levels of complexity – these were the PFI, Joint Venture, Trading Company and Consortium models.

Degree of Complexity

The remaining options are explained in further detail in the remainder of this section.

Different models are best suited to different specific shared services. This feasibility study does not make any recommendations as to which model will be best suited to each service as insufficient financial information was made available. Accordingly, the descriptions of the models define the structural approach to sharing services within the University Quarter; noting that there is a potential role for private sector involvement as described in 5.2.2.

1

Shared services: The opportunities and issues for public sector organisations. © IPF, June 2006

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5.2.2

The role of the private sector The private sector can make a contribution in a number of ways that could be valuable in providing both a catalyst for change and for moving the process forward with focused and dedicated inputs that sometimes in-house teams find difficult to provide. The models included below suggest what the role of the private sector could be in each model but overall could include:


Innovation




Capacity, skills etc., particularly around BPR and process improvement




Entrepreneurial skills




Impetus for change




An ability to smooth the implications of investment, particularly in the early years of a new enterprise




5.2.3

Risk transfer, where appropriate. Model one – in-house shared service developed (Partnership) The provision of the services would come from a shared service established to service all the partners. The operating model in this scenario provides the opportunity to leverage support from the private sector on an advisory basis with preferably a risk and reward payment mechanism for achievement of agreed standards. This model permits a use of pooled resources and a combined approach to collective procurement.

5.2.4

Model two – Trading Company established (Lead Partner) A company would be established with a view to trading with the other bodies and organisations in addition to the purpose of supplying services directly to the parent unitary authority. The private sector can provide advisory services, including capacity creation and organisational change skills, in this scenario without any equity stake, linked to a risk and reward model or other model that ensures remuneration is related to achievement of objectives. Staff would transfer under TUPE or, by agreement, be seconded to the new enterprise.

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5.2.5

Model three – Internal Centralisation The partners each retain their own service. Where the service has been split across a number of faculties or departments, the service would be consolidated to one central department. Under this model, existing staff would be transferred internally to the central department.

5.2.6

Model four – outsourcing or a strategic service delivery partnership with the private sector (Outsourcing) In this model, the partners procure a contract to outsource the services with appropriate specifications and key performance standards, which in effect ensures that the services are delivered by the private sector under the agreed contractual terms. Alternatively, the contract could include a strategic partnership agreement that aligns key organisational objectives with the private sector partner and difficulties and developments are addressed within the terms of the partnership. This model also ensures the service delivery from the private sector. The models for a strategic partnership arrangement could also include a joint venture company. Staff would transfer under TUPE or by agreement, be seconded to the private sector partner.

5.2.7

Model 5 – Co-Sourcing The partners pool their requirements and use the increased buying power to buy aggregated service offerings. Variations of this model include the use of third party consortium buyers, who can procure services such as utilities at a discounted rate (often this type of service would realise purchasing power for a much larger client base than just the University Quarter partners).

5.2.8

Model 6 – Informal Collaboration The partners agree to an ad-hoc sharing of best practice and agree to co-ordinate actions to their mutual benefit. This model provides the maximum in flexibility, as it needs no formal legal / contractual agreements, however, it also has potentially the lowest return as it is the hardest model to implement and it is difficult to apportion savings.

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Output of Options Identification The following table identifies the services which were identified during this feasibility assessment as having the greatest potential for sharing and an indication of the benefits that could be accrued from doing so. The table also shows the anticipated timeframe for implementation, noting that the services which are highlighted were agreed by the Educational Facilities Steering Group for building into the next stage of the process. The services recommended for taking forward were assessed by the partners to meet the criteria that form the headings of the columns. These headings are based on the criteria set out by the DfES:

Service Procurement Network Management Buildings Maintenance Cleaning Parking Mgt Security Creche / childcare Groundskeeping Porterage Catering Counselling & Support Chaplaincy Disability Support Careers / Employment Ground Sharing expertise Pre-entry Advice

Incr ea and sed ef fic e (val ffective iency ue f n or m ess one y) Incr eas ed f l e xi Sta bilit nda y rdis atio I mp n ro effe ved se r ctiv ene vice ss I mp ro proc ved urem ent I mp rove d sus tain abil ity Bet ter i and nform atio data n Per for mea mance sure a men nd Enh t anc ed c apa Tim bilit efra y me

5.3

               

               

               

               

               



               

               

               

Timeframe Key: 1: Quick Win 2: 1 to 2 Yrs 3: 2 years plus Yrs

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1 1 3 3 2 2 2 2 2 2 2 2 2 2 1 1

University Quarter Shared Services Feasibility Study

6 6.1

Evaluation Purpose The purpose of this stage is to develop an evidence base that enables the service delivery models that have not been eliminated in Stage 2 to be assessed in more detail to identify potential for sharing services and to assess the impact on improving aspiration and educational attainment. The outcome of this stage is the development of proposals that will be subjected to detailed options appraisal.

6.2

Constraints Because the University Quarter Programme has separate workstreams dealing with ‘Facilities’ and ‘Curriculum’ (i.e. design of the buildings and how they are to be used for delivery of the syllabus), these areas have not been considered in the preparation of this report. It would be unusual for a major business change initiative (such as this programme) to be received favourably by the workforce. During development and establishment of the individual projects, there will be a strong need for tact and diplomacy. Robust Stakeholder Management and communications planning will be critical to success.

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6.3

Service Evaluation: Pre-entry Advice

6.3.1

Management Pre-entry advice is managed across a number of faculties for the College and the University. The teams handling it for the College are being reorganised at the moment. A small specialist team handles pre-entry advice for the 6th Form College.

6.3.2

Purpose of the Service The purpose of pre-entry advice is predominantly to sell the services of the organisation to potential students (and employers). The service supports potential students, by providing them with the appropriate level of information to assist them with making an informed decision about which course they wish to take. The College and the University both provide financial advice, via finance support. The information differs greatly between the two organisations as the funding sources vary greatly (i.e. 10% of College students receive financial support). The 6th Form College and the College informally collaborate at the working level to make sure that students choose the right course to suit their needs. This is done through their on-line co-ordinated prospectus which permits the students to choose courses based on needs, travel commitments and what will lead to employment / moving on to FE. There is a strong focus on making sure that the students don’t get pressured into the wrong course, and on ‘providing a familiar face to be able to talk to’.

6.3.3

Current Model for Provision of the Service All the partners provide most of their pre-entry advice through in-house experts. However, the University contracts out its pre-entry advice to a specialist provider for international enquiries, and independent finance advice is provided by the Student Union. The College is closely integrated with Connexions (some advisers are even located on the premises).

6.3.4

Proposed Model for Future Provision of Service For the University & College, the opinion of the staff interviewed was that approximately 80% of the pre-entry advice could be classed as generic, however there is a compelling argument that pre-entry advice is about a customer’s journey. Swapping a customer from a generic service to a bespoke one, then back again (possibly several times in their journey) will alienate the customer and not permit a service team to ‘own the prospect’.

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Because there are instances when more than one organisation may be trying to attract the same customer, it was felt that sharing pre-entry advice would not be received well by either the customer or the respective organisations. Should the above barriers be overcome, there is a strong need to retain a local facility to show potential students (and employers) around the buildings and to be able to ‘sell’ the benefits of taking a course at each organisation. For this reason, the model best suited would need to be a partial partnership (some elements of the service shared, with local staff on each site retained for ‘selling’ the courses to visitors). The 6th Form College take a lot of pride in following up all enquiries personally. The personalities of their team are considered important in reflecting their identity and in building relationships with the local secondary schools. There is merit in collaboration over school visits and having a single point of contact, however, when this was attempted previously it was not well received by schools.

6.3.5

KPI’s used to manage the effectiveness of the Service The College tracks targets set by LSC (via heads of departments). These include recruitment targets, employer targets, 17+ progression targets, space utilisation targets and student progress (via student level reports). There is a strategic plan to review and update these targets on a regular basis. The University has service levels to maintain, and is starting to track ‘hot prospects’. The 6th Form College also tracks LSC targets, and has additional measurement of retention, enrolment, response times, uptake of courses following taster events and a number of other performance measures, all designed to track performance.

6.3.6

Buildings Used by the Service The University is currently re-structuring the service (completion due January 2009). Pre-entry advice is currently scattered across a number of faculties on both Stoke and Stafford sites. The College uses all of its sites (Cauldon, Burslem and the three neighbourhood colleges), and pre-entry advice is split on each site, dependant on which course(s) the customer is interested in. The 6th Form College has a small team, who are all located together. This team also regularly travels out to schools.

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6.3.7

Interfaces with the Shared Service College

University

6th Form

Students

Students

Students

Employers

Employers

Employers

LSC (Reporting)

HEFCE (Reporting)

LSC (Reporting)

Parents

International Agencies

Parents

Connexions

Carers’ / Apprenticeships

Connexions

All the partners provide links to their respective financial support providers.

6.3.8

Target Users The College has a wider remit than the University and is actively targeting young and old people, employers, employees, NEET’s and those already in education. The College and the 6th Form College both have a focus on attracting school leavers, however, the College tends to attract those who want a vocational qualification, whereas the 6th Form attracts those students who want to follow a more academic route. There is an informal arrangement, which may benefit from becoming more formalised, whereby the focus is on making sure that the curriculum does not overlap and students are not pressured into making a choice which may not suit them.

6.3.9

Characteristics of the future business model The University is moving towards a more flexible agenda. There is no longer a consistent customer, and it is examining new ways of working such as short term residential courses over weekends or holidays, or specialist services such as conferencing facilities for private businesses / bespoke training interventions. The University currently provides no courses in the evening and is closed over the usual holiday periods. The College works throughout all holidays (with the exception of Christmas), and runs evening courses. Courses on Saturdays are under consideration, as are courses after 21:00. Both the College and the University are exploring what opportunities and challenges exist for distance learning initiatives. Since the College and the 6th Form College essentially do not offer the same courses, there would seem to be a benefit of a more formal collaboration, such that only one team attends an event (at the moment both teams attend, often wasting resources and time), and operating a

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‘one stop shop’ (offering impartial advice, and focussing on finding the best course to match a students needs).

6.3.10

Funding overview Both the college and the 6th Form College receive funding via the LSC. There is also occasional NEET’s funding from the local authority for both partners.

6.3.11

Benefits overview Implementing shared services could result in improvements to services for students / parents, improved co-ordination of staff, and reduction of time wasting at events by reducing unnecessary attendance. It is worth noting that Stoke’s performance is at the bottom of the national league tables, so the focus must be on working more efficiently, so as to attract and retain more local students into FE / HE.

6.3.12

Key Risks to developing a shared service University:


Losing the tangible relationship with potential students




Pre-entry advice has a wider remit (local accommodation, guidance on the local area) which could be compromised




Risk losing to ability to be flexible College:




Need to maintain personalisation




Call-centre approach will not be specific enough to provide a high quality service, as staff from each department are used in pre-entry advice currently




Existing people and processes are effective and considered really important 6th Form College




Need to maintain their identity, as this is a key selling point




Concerned that the University Quarter may need to recover their investment, at the expense of attracting students to inappropriate courses




Needs to maintain the current level of personal service and contact




A call-centre approach would not be acceptable in the current economic climate

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There was a strong consensus of opinion that elements of pre-entry services could be shared and standardised, however, there is a risk that this could reduce the quality of service that students receive and this would need to be carefully managed to ensure service levels were maintained.

6.3.13

Quick Win areas During the interviews, there were a number of areas which were considered as being mutually beneficial:


Enrolment on-line for simple / routine courses




Guaranteed progression routes (i.e. College to University)




Facilitated engagement of employers / private businesses. There would need to be agreement on mutual benefits and common objectives, whilst keeping the customer at the centre




Sharing of bids for external funding




Hold regular meetings between the three organisations to share best practice and work towards service improvement / possible integration planning




Formalise the prospectus planning and timetabling of events, so that they work to the advantage of the students (i.e. hold events on the same night, at a central location, so that parents and students can compare all offerings together)

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6.4

Service Evaluation: Student Services

6.4.1

Summary At present each of the partners provides their Student Services (Counselling & Support, Chaplaincy, Disability Support, Careers / Employment, and Childcare) through an in-house provider. Whilst there are differences in the services, mirroring funding rules and operational constraints, there are wide areas of similarity that could be used as the basis for either full or partial sharing of each service.

6.4.2

Themes During the interviews undertaken, there were number of repeating themes:

6.4.3




Because of the similarity of the services, there will be clear benefits to all partners by sharing best practice and operational processes.




There is a shortage of crèche / childcare places for each of the partners, and there is an indication that it may be beneficial to segment the current offering (babies / children)




Measurement of service performance varies greatly across the services, ranging from contribution towards the generic student satisfaction survey, to in-depth analysis of performance metrics

Recommendations Over the short term there would appear to be quick wins by bringing the service heads from each of the partners together and sharing best practice. Also in the short term there is a pressing need to consider pooling resources and sharing childcare. With demand outstripping supply there is a clear need for an increase in childcare capacity, and there may even be opportunities to generate additional revenue by opening the service to local residents. In the medium to long term the possibilities range from sharing of an entire service to partial sharing of elements of a service. Considering that sharing services is in its infancy, we would recommend returning to this matter in six months, after reviewing how well the short term projects are progressing.

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6.5

Purpose of Services Service Counselling & Support

Chaplaincy

6th Form

College

University

To provide a confidential and independent service; that can represent students and liaise with each of the partners. The College service also represents staff, and the University uses a private organisation for their staff. To provide prayer room for all faiths. The University also has a full time chaplain and unpaid faith advisors, but only has a prayer room for Muslims. All partners use guest speakers.

Disability Support

To provide learning support and staff training. University runs a Regional Assessment Centre for Staffordshire and also provides non-curriculum support. 6th Form collaborates with Blackfriars Special School.

Careers / Employment

To provide advice on courses, guidance on course progression, continuing in education or moving into a career. 6th Form has Connexions 4 days a week on site. College and University have Job / work banks and their own careers advisers. The University also runs skills training (CV and interview skills), careers library, e-resources and runs virtual employers fairs.

Ground Sharing Expertise

To share best practice, develop topics which are currently giving problems, share experience about effective ways of getting around common obstacles.

Childcare

No facilities on campus. Share facilities at Fenton Manor.

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Small Nursery on campus. Demand is greater than supply.

Crèche available but limited number of places. Demand is much greater than supply.

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University Quarter Shared Services Feasibility Study

6.5.1

Current Model of Services

Service

6th Form

College

University

Counselling & Support

In-House

In-house

In-House

Chaplaincy

N/A

N/A

In-House

In-House

In-House. Ranstad supply support workers for disability support.

Disability Support

In-House. Some students referred to Mind and Assist.

Careers / Employment

All provided In-House. Connexions work on all sites. University leases space to Work Bank.

Ground Sharing Expertise

In-House

In-House

In-House

Childcare

Use facilities at Fenton Manor

In-House

In-House

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6.5.2

Potential Future Model

Counselling & Support

Chaplaincy

Disability Support

Careers / Employment

Childcare

Possibility of sharing. Presence needed on each site, and staff would need appropriate training for different audiences. Sharing would provide a useful improvement for the 6th Form and College. Obstacles would include funding restrictions, and the need to get unpaid resources to cover a wider base. Sharing best practices and processes. Need to establish common handover and transition mechanisms. University funding currently via local authorities, however, in 2010 this will transfer to the Student Loan Co. which may alter the funding model. Collaboration of mechanisms for Pathways / moving on. There may be benefits from sharing elements of their databases for employer engagement, work experience and transfer of student information. Shared service, available on each campus. There is a strong indication of a need for this service, with demand exceeding supply.

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6.5.3

Key Performance Indicators

Service

6th Form

College

Counselling & Support

Volume of students supported. Next year planning to look at retention. Also use student questionnaires.

Retention achievement analysis. Use student questionnaires. Department heads generate annual reports.

Chaplaincy

N/A

N/A

Disability Support

Retention achievement.

All appeals and complaints analysed by disability, gender, age and race.

Volume of students seen by Connexions.

Volume of students seen by Connexions. Full analysis of student achievements and where they all went. Targets set for improvement by Government.

Careers / Employment

Questionnaires, annual reports and achievement data. Children’s centre committee reports on user profile, turnover, CPP and absence.

Childcare

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University Questionnaires from counsellors to clients. Annual student satisfaction survey. Annual report on volumes / usage, and breakdown of types of clients / problems. Management reporting. Multifaith advisory committee reviews their work. All appeals and complaints analysed by disability, gender, age and race. Reporting to disability forum, with representatives from each faculty. Questionnaires sent to students. Annual student satisfaction survey. Annual report on volumes / usage, and breakdown of where students went after graduation (Hefce survey). Questionnaires. Annual satisfaction survey. Annual report on volumes / usage.

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6.5.4

6.5.5

Interfaces with Shared Services


Access card system may be needed for shared services, as each partner has differing access strategies (young people need greater protection).




College has public access to training areas (hairdressing, restaurant…).




External service staff are either permanently based in buildings or visit (some frequently and others infrequently)

Strategic Fit Mostly driven by finance and the expectations of Governors, with a strong drive to proving that each service makes a tangible difference. The funding providers often have restrictive clauses and are invariably supported by business cases with key performance measures. Current focus for all partners is for the inclusion / participation agenda, and in some cases the financial model is augmented with a need for matched funding

6.5.6

6.5.7

Key areas for future co-operation and sharing


Sharing of best practice




Shared service standards (i.e. referral system – acting as a helpful neighbour)




Possible to share fee information / match fees, so as to reduce competition over cost (so the students can choose the most suited provider without cost being a major factor)




Understand the differences between partners, and work towards common staff development programmes

Key Risks


Any change initiatives will need careful scrutiny, because of the performance measures that are currently in place.




College has approximately 2000 ESOS (Education Services Overseas) students and University has approximately 500 Chinese / Foreign students. Any change must not negatively impact these figures.




Student surveys indicate reluctance to access services either on a different campus, or in the case of the larger campuses in buildings which are some distance away.

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6.5.8

6.5.9




University students are very conscious that they are paying for their services and it is thought that they would react badly to any perception that they were subsidising anything for the other partners.




There is anecdotal evidence that improving the service offering will increase demand (increases in cost are not a viable option).

Critical Success Factors


Retention and attraction of students is critical to all partners. Anything perceived to threaten this will strongly compromise sharing services.




Performance of the shared services will need to either match or improve on the current service levels.

Target Users Students/ Staff/ Visitors/ Public & Community/ Actual Employers (students would seek employment with).

6.5.10

Overview of Funding for Student Counselling

Service

6th Form

College

University

£6k

£650k (approximately 3000 students use service)

£800k

90 students out of 1700

2000 students out of 30,000

800 students

Funding Overview

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6.6

Service Evaluation: Building Maintenance

6.6.1

Summary At present the Building Maintenance Services for both Stoke Colleges and the Staffordshire University are a combination of small in-house teams and outsourced specialist maintenance contractors. This combination of service delivery would appear to provide all three campuses with the quick reactive maintenance provision that their respective target users require. In addition, they all have the capacity to meet ‘call-off’ requirements from specialist maintenance providers, via outsourced contracts, set up by their individual establishments. Unfortunately, we were unable to specifically determine the exact costs associated with this particular FM Service – though the 6th Form College advised of a £250k budget and the University advised of an overall departmental budget of £5.6M. However, taking account of the University’s overall turnover of £100M, we could surmise that their Building Maintenance budget would be around the £3M area and the Stoke College’s overall turnover of £42M, may give them a Building Maintenance budget of around £1.25M.

6.6.2

Purpose of Service To maintain an environment that ensures that education services can be delivered economically, sustainably, in a safe condition, and following compliance requirements.

6.6.3

Recommendations There is an urgent requirement to agree operation of shared facilities for new buildings. The configuration of building maintenance services, for all three establishments should be reviewed. This review could be conducted over the medium or long term; however, there is a possibility that a review of these Services could commence in the short term given that the Building Maintenance Service is probably the largest cost in the Estates Services department. Although limited information was available it is likely that significant efficiencies and improved services may be achievable by reviewing the options for sharing the Health, Safety & Environment roles for each establishment.

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6.6.4

Current Service Model 6th Form College

Small in-house Team Outsourced Contractors

6.6.5

Stoke College In-house Team of 4FTE: Building Services Manager; x2 Electricians; x1 General (minor repairs) Outsourced specialist contractors

In-house Team of Head of Building & Estates Services, Maintenance Manager, x5 Electricians; x2 Plumbers (reactive repairs) Outsourced specialist contractors In-house Helpdesk service

Buildings 6th Form College

All of the 6th Form College Campus – building and site

Stoke College 2 Main Campuses – Cauldon & Burslem (Note: No Porterage service at Burslem site)

University 2 Main Campuses – Stoke & Stafford

Joint venture site with Lichfield College

City Centre leased building 2 Neighbourhood Colleges 8 Locations in Stafford (offices for meetings)

6.6.6

University

3 Hospital Buildings (for teaching nursing)

Shrewsbury, Oswestry, Telford

Themes All three education environments appear to need a speedy and effective, reactive maintenance service to ensure educational needs are correctly delivered during weekday core hours. Each establishment has its own in-house skilled personnel, such as electricians, as well as individually procured, specialist maintenance controls.

6.6.7

Critical Success Factors Maintenance responsiveness from in-house teams at all locations – allows for quick reactions to problems at sites and speed of resolution.

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6.6.8

Proposed Model of Future Provision Mixed in-house/outsourced service (small in-house rapid response during core hours only).

6.6.9

Interfaces, Users and Key Performance Indicators

Area Interfaces with Shared Services (Strategic Fit)

6th Form College Primarily Building Services and Security work closely with ICT

Stoke College Primarily Building Services and Security work closely with ICT

University Primarily Building Services and Security work closely with ICT Interface with Students Unions

Target Users Students/ Staff/ Visitors/ Public & Community/ Actual Employers (students would seek employment with) KPI’s used to manage the effectiveness of the service

An E-Mandate completed annually – which contains lots of feedback information

Formal feedback on Estates from the Faculties In process of setting up a helpdesk system (on the back of the IT helpdesk system)

Formal feedback on Estates from the Faculties

Reactive Maintenance Information/feedback via the on-site Helpdesk system Estates Management Statistics Annual student surveys (FM questions and Property focused) Formal meetings with Head of Facilities and Business Managers Overall Limited Feedback

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6.7

Service Evaluation: Cleaning

6.7.1

Summary The cleaning services for the 6th Form College and Stoke College are outsourced to two separate service providers; KGB (short term contract) and ISS (three year contract) respectively. Staffordshire University have a large in-house cleaning provision with up to 80 staff, managed by their Domestic Services Manager. The cleaning services are tailored to the specific needs of the education building types and target users. Financially, the cleaning services are generally around 1% of a business’s turnover. The 6th Form College’s costs for this service were £100k, Stoke College costs were £420k and Staffordshire University’s costs were estimated from their £100M turnover to be £1M.

6.7.2

Purpose of Service Important aspects are appearance, a pleasant environment and the timing of the service delivery.

6.7.3

Current Service Model 6th Form College Outsourced – KGB Company (short term contract)

6.7.4

Stoke College

Outsourced – ISS Company (three year contract)

University In-house Team of 70-80 staff, managed by Domestic Services Manager, reporting to Head of Campus Services

Buildings 6th Form College

All of the 6th Form College Campus – building and site

Stoke College

2 Main Campuses – Cauldon & Burslem (Note: No Porterage service at Burslem site) City Centre leased building, 2 Neighbourhood Colleges 8 Locations in Stafford (offices for meetings)

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University

2 Main Campuses – Stoke & Stafford,Joint venture site with Lichfield College 3 Hospital Buildings (for teaching nursing) Shrewsbury, Oswestry, Telford

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6.7.5

Themes Whilst the timely maintenance of a clean, hygienic and pleasant environment is the key success factor of any cleaning service within each of the education environments, the question asked to ‘whether these Services are particularly outsourced or in-house’, appears not to be a major factor – though it was noted that a key risk raised was the TUPE of an in-house team and the unions representing them.

6.7.6

Recommendation It would seem sensible to further review the possibilities of the configuration of the cleaning services for all three establishments. Again, this review could be conducted over the medium or long term; however, there is a possibility that a review of these Services could commence in the short term, given the two Colleges’ short term outsourced contracts, and the fact that the overall service costs are the second highest in the Estates Services department.

6.7.7

Interfaces, Users and Key Performance Indicators

Area Interfaces with Shared Services (Strategic Fit)

6th Form College Primarily Building Services and Security work closely with ICT

Stoke College Primarily Building Services and Security work closely with ICT

University Primarily Building Services and Security work closely with ICT Interface with Students Unions

Target Users Students/ Staff/ Visitors/ Public & Community/ Actual Employers (students would seek employment with) KPI’s used to manage the effectiveness of the service

An E-Mandate completed annually – which contains lots of feedback information

Formal feedback on Estates from the Faculties In process of setting up a helpdesk system (on the back of the IT helpdesk system)

Formal feedback on Estates from the Faculties

Reactive Maintenance Information/feedback via the on-site Helpdesk system Estates Management Statistics Annual student surveys (FM questions and Property focused) Formal meetings with Head of Facilities and Business Managers Overall Limited Feedback

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6.7.8

Sourcing Options 1. Single outsourced cleaning contract for all the partners which could be managed centrally of locally by each institution 2. In-house service – managed either locally or centrally 3. One cleaning contract outsourced to the University’s in-house service

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6.8

Service Evaluation: Parking Management

6.8.1

Summary Parking Management and Security Services appear to be two very closely linked services at all three education campuses. There are in-house teams employed to carry out parking management, which includes barrier control, flow plates, problematic parking of cars, and adherence to planning and/or legislative issues, at all three establishments. Costs associated with this Service were available for Stoke College only - £180k (as the 6th Form College include their costs in their Security Service and the Staffordshire University had only advised of a total departmental cost of £5.6m)

6.8.2

Purpose of Service The purpose of the service is the management of parking within the campuses including barriers, flow plates and adherence to planning/legislative issues.

6.8.3

Current Service Model 6th Form College In-house Team

6.8.4

Stoke College In-house Team of 5FT and 2PT Security Officers (covering both sites)

University In-house Campus Services Team

Building Used 6th Form College

Stoke College

All of the 6th Form College Campus – building and site

2 Main Campuses – Cauldon & Burslem (Note: No Porterage service at Burslem site) City Centre leased building 2 Neighbourhood Colleges 8 Locations in Stafford (offices for meetings)

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University 2 Main Campuses – Stoke & Stafford Joint venture site with Lichfield College 3 Hospital Buildings (for teaching nursing) Shrewsbury, Oswestry, Telford

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6.8.5

Themes All three education environments appear to experience the same type of problems with parking management, i.e. problematic car parking and limited measures or policy available to assist. (One area which was discussed was the option of working with the local football club to introduce measures like ‘Park n Ride’.)

6.8.6

Proposed Mode for Future Provision Future provision should be through an in-house team for core hours. There is the possibility of an outsourced ‘Park n Ride’ venture with local football ground.

6.8.7

Sourcing Options Shared outsourced contract between all campuses. Site specific in-house parking management teams.

6.8.8

Recommendation In the short term the parking management issues could be addressed (probably in tandem with Security Services) as a bespoke service area for all three education establishments, or indeed on an individual establishment basis. However, taking account of the new Stoke University Quarter Campus, and the changes to buildings, and potentially the increased numbers of personnel within them, the logistics of parking management, etc, a medium to long term review would be beneficial. Note: Those representing the FM Services advised there may be restrictions re: future parking developments around the existing Stoke University Quarter campus and sites.

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6.8.9

Interfaces, Users and Key Performance Indicators

Area Interfaces with Shared Services (Strategic Fit)

6th Form College Primarily Building Services and Security work closely with ICT

Stoke College Primarily Building Services and Security work closely with ICT

University Primarily Building Services and Security work closely with ICT Interface with Students Unions

Target Users Students/ Staff/ Visitors/ Public & Community/ Actual Employers (students would seek employment with) KPI’s used to manage the effectiveness of the service

An E-Mandate completed annually – which contains lots of feedback information

Formal feedback on Estates from the Faculties In process of setting up a helpdesk system (on the back of the IT helpdesk system)

Formal feedback on Estates from the Faculties

Reactive Maintenance Information/feedback via the on-site Helpdesk system Estates Management Statistics Annual student surveys (FM questions and Property focused) Formal meetings with Head of Facilities and Business Managers Overall Limited Feedback

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6.9

Service Evaluation: Security

6.9.1

Summary Linked closely with the parking management services at all three education establishments, the security services are all provided by in-house staff during the core daytime hours, and then outsourced during the evenings. Outsourcing is to different contracted security providers for each establishment. Costs for these services were difficult to ascertain, as they appear within the Parking Management Services’ costs. For the 6th Form College a cost of £20k was stated, Stoke College were able to advise of costs of £180k and part of the overall £5.6M departmental budget for Staffordshire University covered this Service.

6.9.2

Purpose of Service The purpose of the service is to ensure a secure environment, promoting a positive/vibrant attitude, and to offer understanding and respect to students/staff. Security within the campuses is everyone’s responsibility. CCTV’s are monitored at local level at all campuses.

6.9.3

Current Service Model 6th Form College In-house Team x1 (Barrier system in operation) Outsourced evenings – callout system

6.9.4

Stoke College

Outsourced evening (Redguard Company)

University In-house campus Services Team Outsourced evenings (ISS Pegasus)

Sourcing Options 1. In-house day teams brought together and managed as one service 2. Shared outsourced contract between all the partners

6.9.5

Themes There was a lot of common ground for the security services in all three education establishments, in that they had in-house services during the day and outsourced the service during the evenings. Having security in-house teams was seen as a benefit and critical success factor to the services provided, because they had a good understanding and relationship with the students and staff at the campuses, and sound knowledge of an educational environment. (Note: Previously outsourced security services were viewed as too ‘Police biased’)

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6.9.6

Building 6th Form College All of the 6th Form College Campus – building and site

6.9.7

6.9.8

6.9.9

Stoke College 2 Main Campuses – Cauldon & Burslem (Note: No Porterage service at Burslem site) City Centre leased building 2 Neighbourhood Colleges 8 Locations in Stafford (offices for meetings)

University 2 Main Campuses – Stoke & Stafford Joint venture site with Lichfield College 3 Hospital Buildings (for teaching nursing) Shrewsbury, Oswestry, Telford

Critical Success Factors


Colleges – have an in-house security team that has a good understanding/relationship and mutual respect with students and staff, and knowledge of the working environment education sector requires.




University - to work very closely with the outsourced security company who provide out-of-hours service.

Proposed Mode for Future Provision


In-house team for core hours




Outsourced evenings

Recommendation As above for Parking Management recommendation, in the short term the Security Services could be addressed (in tandem with Parking Management) as a bespoke service area for all three education establishments, or indeed on an individual establishment basis. However, taking account of the new Stoke University Quarter Campus, and the changes to buildings, and potentially the numbers of personnel within them, changes to what and whom need security measures etc, a medium to long term review would be beneficial.

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6.9.10

Interfaces, Users and Key Performance Indicators

Area Interfaces with Shared Services (Strategic Fit)

6th Form College Primarily Building Services and Security work closely with ICT

Stoke College Primarily Building Services and Security work closely with ICT

University Primarily Building Services and Security work closely with ICT Interface with Students Unions

Target Users Students/ Staff/ Visitors/ Public & Community/ Actual Employers (students would seek employment with) KPI’s used to manage the effectiveness of the service

An E-Mandate completed annually – which contains lots of feedback information

Formal feedback on Estates from the Faculties In process of setting up a helpdesk system (on the back of the IT helpdesk system)

Formal feedback on Estates from the Faculties

Reactive Maintenance Information/feedback via the on-site Helpdesk system Estates Management Statistics Annual student surveys (FM questions and Property focused) Formal meetings with Head of Facilities and Business Managers Overall Limited Feedback

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6.10

Service Evaluation: Grounds Maintenance

6.10.1

Summary Grounds Maintenance Services for the 6th Form College and Stoke College are outsourced to two separate service providers; Croppers (short term contract) and M&S respectively. Staffordshire University have a small in-house team of three personnel. The Grounds Maintenance Services are tailored to the specific needs of the education campus types and target users. Costs were not available for two establishments; the 6th Form College indicated theirs were around £10k.

6.10.2

Purpose of Service The purpose of the service is to provide a safe and pleasant environment around the campuses which are eco-friendly, as well as providing functional sporting facilities on the campuses.

6.10.3

Current Service Model 6th Form College Outsourced – Croppers Company (Short term contract)

6.10.4

Outsourced – M&S Grounds Maintenance Company

University In-house team of Grounds Manager plus x2

Building Used 6th Form College All of the 6th Form College Campus – building and site

6.10.5

Stoke College

Stoke College 2 Main Campuses – Cauldon & Burslem (Note: No Porterage service at Burslem site) City Centre leased building 2 Neighbourhood Colleges 8 Locations in Stafford (offices for meetings)

University 2 Main Campuses – Stoke & Stafford Joint venture site with Lichfield College 3 Hospital Buildings (for teaching nursing) Shrewsbury, Oswestry, Telford

Themes All three education establishments were content with the grounds maintenance services they receive, and the risk associated with this service (chemicals used for

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weeds, paint for sports pitch marking, etc) were considered high, for the two Colleges. The University did have internal staff issues, though did not believe the Service could not be wholly outsourced given TUPE would apply.

6.10.6

Proposed Model for Future Delivery Outsourced (given scale of grounds within University Quarter and sports facilities required) – though in-house team of three personnel to consider.

6.10.7

Recommendation Not a Service which necessarily needs to be addressed short term though should be included in the medium to long term review of FM and Estates Services, when the new buildings and campuses come on-line.

6.10.8

Interfaces, Users and Key Performance Indicators

Area Interfaces with Shared Services (Strategic Fit)

6th Form College Primarily Building Services and Security work closely with ICT

Stoke College Primarily Building Services and Security work closely with ICT

University Primarily Building Services and Security work closely with ICT Interface with Students Unions

Target Users Students/ Staff/ Visitors/ Public & Community/ Actual Employers (students would seek employment with) KPI’s used to manage the effectiveness of the service

An E-Mandate completed annually – which contains lots of feedback information

Formal feedback on Estates from the Faculties In process of setting up a helpdesk system (on the back of the IT helpdesk system)

Formal feedback on Estates from the Faculties

Reactive Maintenance Information/feedback via the on-site Helpdesk system Estates Management Statistics Annual student surveys (FM questions and Property focused) Formal meetings with Head of Facilities and Business Managers Overall Limited Feedback

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6.11

Service Evaluation: Porterage

6.11.1

Summary The Porterage Service at the three education establishments is one geared very much to an ‘Internal’ service, by in-house staff, managed locally, reacting to the fluctuation of duties from one area to another. Post, furniture, equipment, storage and even driving duties are the main aspects. Costs for this Service are staff related with £50k stated for the 6th Form College, £160k for Stoke College and Staffordshire University’s costs are inclusive within their £5.6M budget.

6.11.2

Purpose of Service A service which operates an efficient movement of post, equipment, furniture and storage. The University also includes driving duties.

6.11.3

Current Service Model 6th Form College In-house Team

6.11.4

In-house Team (includes Postal team)

University In-house Campus Services Team

Buildings Used 6th Form College All of the 6th Form College Campus – building and site

6.11.5

Stoke College

Stoke College 2 Main Campuses – Cauldon & Burslem (Note: No Porterage service at Burslem site) City Centre leased building 2 Neighbourhood Colleges 8 Locations in Stafford (offices for meetings)

University 2 Main Campuses – Stoke & Stafford Joint venture site with Lichfield College 3 Hospital Buildings (for teaching nursing) Shrewsbury, Oswestry, Telford

Themes All establishments appear to offer a similar type of Service/Duties.

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6.11.6

Proposed Model for Future Delivery In-house only due to bespoke nature.

6.11.7

Recommendation A Service offered by in-house staff which would, if even considered to be outsourced, provide some major logistical difficulties in the direct management of them. Short term we would not recommend reviewing this Service, as it appears very bespoke to the Educational environments. Medium to long term there may be some mileage in reviewing these ‘Internal’ teams, with the possibility of combining them.

6.11.8

Interfaces, Users and Key Performance Indicators

Area Interfaces with Shared Services (Strategic Fit)

6th Form College Primarily Building Services and Security work closely with ICT

Stoke College Primarily Building Services and Security work closely with ICT

University Primarily Building Services and Security work closely with ICT Interface with Students Unions

Target Users Students/ Staff/ Visitors/ Public & Community/ Actual Employers (students would seek employment with) KPI’s used to manage the effectiveness of the service

An E-Mandate completed annually – which contains lots of feedback information

Formal feedback on Estates from the Faculties In process of setting up a helpdesk system (on the back of the IT helpdesk system)

Formal feedback on Estates from the Faculties

Reactive Maintenance Information/feedback via the on-site Helpdesk system Estates Management Statistics Annual student surveys (FM questions and Property focused) Formal meetings with Head of Facilities and Business Managers Overall Limited Feedback

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6.12

Service Evaluation: Catering Services

6.12.1

Summary Catering Services for Stoke College and Staffordshire University are at present an inhouse operation and the 6th Form College has an outsourced service provider, Scholarest. The catering outlets provided in the three education environments are a good mix of large restaurants, smaller cafes, vending, hospitality facilities and retail, geared towards their respective target users. Financially, the 6th Form College and University are not regarded as profitable, yet the Stoke College has an in-house operation, which is making profit and adding to its organisation’s funds.

6.12.2

Themes All three education environments appear to primarily need elements of change and flexibility within their respective food service provisions, and these needs are required on a timely basis. It would seem that the Stoke College and Staffordshire University’s in-house teams are able to react to these issues quicker than those of the outsourced service provider, whom may have restrictions under their contract. There is a clear theme that catering services play a key part to the learning environments within the education establishments, in that a good array of food services, e.g. cafes for quicker service, larger restaurants to offer a wide variety of food types, are on offer.

6.12.3

Recommendation There appear to be pro’s and con’s to both in-house and outsourced catering service providers. A quicker reaction to change and greater flexibility in food services, appear to be a huge plus point for the in-house option, whereas the outsourced option takes the risks of staff issues and food, health and hygiene regulatory requirements. As part of the project development of the new Stoke University Quarter Campus buildings, it would seem prudent to investigate, over the medium term, the options available for the provision of catering services, across all three education environments.

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CATERING SERVICE PROFILE - 6TH FORM COLLEGE, STOKE Purpose Buildings Used Current Model of the Service

Interfaces Target Users KPI’s used to manage effectiven ess of the Service Benefits / Critical Success Factors Key Risks

Funding Overview Proposed Model for Future provision of Service

Sourcing Options

To provide Catering provisions for students, staff and visitors to the College to enhance the learning environment and experience 6th Form College Campus only Business Hours – 0730hrs – 1700hrs (Wed/Thurs til 2100hrs for Open University) Outsourced Catering to Scholarest – Initial Contract 4yrs + 2yrs extension. x1 Catering Manager/x9 Catering staff Catering Outlets include: Main Servery (Hot/Cold) – 70 seats – 0745hrs – 1400hrs, Café – 40 seats – 0900hrs – 1500hrs, Shop (Grab ‘n’ Go) – 0800hrs – 1630hrs, Staff Canteen – 0800hrs – close of business, Vending (College by Shcolarest/ Staff area by College), Large scale kitchen/servery equipment replacement and maintenance – college take responsibility, (Servery 5 years old) College staff interface with Caterers and their external Management. Caterers use college building/rooms for their meetings 1600 Full time students, 200 staff, Visitors, Public/Local Community & Open University, Actual Employers (whom students may seek employment with) Contractually: Monthly report and invoice received by college. Indicates performance financially. Twice per term student forum held: Feedback on all college items. Catering part of these forums. Specific Catering focus group meets ad hoc: Chaired by Director for Finance & Resources/ Attended by staff & students, Catering Manager & Area Manager. No official KPIs record Service Delivery No cash flow for college, Contractors risk to cover absences Outsourced Contractor has network/connections with other catering providers at other colleges, Students on committee of tender, Customer service very good. Staff trained and rotated around various catering units. Staff turnover low No major risks perceived ‘Change’ process is slower when Outsourced ‘Flexibility’ of Services limited for College, when Outsourced Length of Contract (4+2 years) possibly too long An agreed budget with College and Outsource Contractor. Surplus is shared on 50/50 basis. Deficits are college borne. £350k turnover – Profit share based on takings/budget Catering provision for moving to new SUQ campus has been agreed and is similar in numbers and configuration to that of the present 6th form College. Given a different ‘Customer Base’ i.e. younger students, to that of University and College, Catering outlets are probably best placed in keeping them separate. However, provision of one jointly appointed Catering provider could be considered. Outsourced – on single building contract In-house College service – on single building contract Combined service either Outsourced or In-house with Stoke College and/or University’s contracts

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CATERING SERVICE PROFILE - STOKE COLLEGE Purpose Buildings Used Current Model of the Service

Interfaces Target Users KPI’s

Benefits / CSF Key Risks Funding Overview

Proposed Model for Future provision of Service

Sourcing Options

To provide Catering provisions for students, staff and visitors to the College to enhance the learning environment and experience Stoke College Buildings on two campuses (Cauldon – main campus and Burslem) Nursery building on Cauldon Campus - 64 places (meals provided by Caterers) In-house Catering service (Note: Gained ‘Healthy College Status’ in Catering – 2nd College in country to do so) x1 Catering Manager/x40 Catering staff – all internal College staff Catering Outlets include: 3 Restaurants (1 large main servery & 1 café at Cauldon Campus/ 1large main servery at Burslem campus) 3 Retail shops (2 Newsagent type shops at Cauldon campus/ 1 snack shop at Burslem campus) Hospitality – for meetings, etc Vending (Contracted out) Training kitchen/restaurant at Cauldon site (as part of student course in Catering)– meals are available from this restaurant at lunchtime Department Heads meet fortnightly – Interfaces on various projects Catering Manager - Ambassador for Health & Safety for College 30,000 Students (Full and Part time ‘foot fall’), Several hundred staff, Visitors, Public/Local Community ,Actual Employers Student Survey Questions on Catering, Cross College Survey, Programme Area – feedback meetings, Focus Groups with Catering Manager Customer service is very ‘focused’ – as it is provided by an In-house team. Flexibility of In-house team – seen as ‘bigger part’ of College’s staff. In-house Catering Operation is Profitable – adding to funds Outsourcing option may not offer staff flexibility Outsourcing would not necessarily add any funds to the College The Catering Operation is profitable – adding to the College’s funds £2.6M turnover – £2.3M expenditure Restaurants £750k (plus contract for sandwiches and fruit boxes) / Retail £340k/ Vending £12k Catering provision for moving to new SUQ campus has been agreed and includes: Two large Restaurants - one at each Campus (Cauldon & Burslem), One ‘Grab ‘n’ Go’ Outlet (Cauldon), One Pie type shop (Burslem), Coffee Bars around the College, Hospitality and Conference provision, Vending Given a different ‘Customer Base’ i.e. different to that of the 6th Form College, and the location of the College at the SUQ Campus, Catering outlets are probably best placed in keeping them separate. However, provision of one jointly appointed Catering provider could be considered. In-house College service – for two campuses (as is) Outsource – for two campuses Combined service either Outsourced or In-house with 6th Form College, Stoke and/or University’s contracts

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CATERING SERVICE PROFILE - STAFFORDSHIRE UNIVERSITY Purpose of the Service

To provide Catering provisions for students, staff and visitors to the University Campus to enhance the learning environment and experience.

Buildings Used by the Services

Staffordshire University Buildings on three Campuses (Stoke – main campus/ Stafford and Lichfield centre). Nursery building on Stoke Campus (meals provided by Caterers) Head of Hospitality & Leisure Services has Residential Services under his remit. Buildings used for this are all student accommodation halls. Current In-house Catering service Model of the x1 Catering Manager/x1 Head Chef/Catering Supervisors/ Chefs/ Cooks and Service General Assistants - 70 Catering internal College staff Catering Outlets include: Stoke: Two Student Restaurants – 0700hrs – 1730hrs Two DolcHe Vita Coffee Bars – 0800hrs – 2000hrs One Hospitality Suite Stafford: Two Student Cafeterias One DolcHe Vita Coffee Bar One Hospitality Suite Lichfield: One Coffee Bar Student Union Bars are at two Campuses but NOT managed by the In-house Catering teams Interfaces Head of Hospitality & Leisure Services links closely to other Facilities Management, Property & Estates personnel, as well as Shared Services personnel, the Vice Chancellor & Chancellor. Target Users Students, Staff, Visitors, Public/Local Community, Actual Employers (whom students may seek employment with) KPI’s Annual Student View Finder: On-line survey for students, which includes Catering questions. To be replaced with Internal Student Barometer – with more detailed Catering Questions. Quality Assessment - from those eating in Catering Outlets and any formal letters/emails of complaints received Benefits / Catering Services are geared toward the students/customers at the campus – Critical and changes to the Services shift with those customers’ needs. In-house team Success allows for that flexibility. Offering a wide range of Catering Outlets (either Factors dispersed over campus or centrally) to meet the growing and changing needs of the University’s customers Key Risks Funding uncertainty for new SUQ Buildings Designing a Catering Operation now; though delivering food service in 3 years time. Will the needs then fit what is built? Nutritional awareness – changes from customers eating patterns Key investment needed in premises – to update facilities Changes to staffs employment terms, etc Funding College turnover £107M. Subsidiary Budget given for Catering. Overview £6.6M turnover for Hospitality & Leisure (£4.2M Residential) Income for Catering £1.2M with 10% subsidiary. Agree income levels for each year with University. Revenue for equipment/maintenance £2k Staffing 60% of costs. Catering deficit £120k per year (student numbers key factor) Financial monthly reviews held with Head of Catering

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Proposed Model for Future provision of Service

Sourcing Options

Catering provision for moving to new SUQ campus is still to be agreed. The DolcHe Vita coffee brand would be seen by the Caterers as ideal to expand upon, around the campus. Given a different ‘Customer Base’ i.e. a large eclectic student type at the University, the Catering outlets are possibly best kept separate from those of the College and 6th Form. However, provision of one jointly appointed Catering provider could be considered. In-house University service – for three campuses (as is) Outsource – for three campuses Combined Service either Outsourced or In-house with 6th Form College, and/or Stoke College contracts Given size of Campus and customer base, take over Catering Services for all three Campuses (University, Stoke College and 6th Form, Stoke) and offer a sub-contracted service to both Colleges

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6.13

Service Evaluation: IT Network Management

6.13.1

Purpose of the Service Network Management is a key part of an organisation’s IT function. Network Management refers to the provision and administration of the organisation’s network infrastructure. This includes;


Network Infrastructure – The physical topology and architecture of the organisation network.




Operation and Administration – The method for managing and monitoring network performance and enabling effective service delivery.




Maintenance and Service Provision – The processes and procedures in place for maintenance, repairs, configuration, service charges etc.




User profiling and administration, security and performance – The controls in place at user or ‘group’ level to control and manage privileges, access rights and security.




Resources and Training – Training of internal staff to develop the required skills/knowledge required in network management.

An analysis of the above in each organisation has provided a number of activities and initiatives that may be undertaken to meet the shared services requirement.

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6.13.2

Current Model for Provision of the Network Management Service

Function

Component

Current Model – SU In-house provision

Current Model SC In-house Provision

Current Model - S6FC In-House Provision

Infrastructure

Local Area Network

Wide Area Network

Lead department

Strategic Partnership via SU

Strategic Partnership via SU

Incoming Communications

Strategic Partnership – JANET

Strategic Partnership JANET

Strategic Partnership JANET

Core Switches

Management – Inhouse Provision

Management – Inhouse Provision

In-house Provision

Product Support – Outsourced

Product Support Outsourced

Management – Inhouse Provision

Management – Inhouse

Product Support – Outsourced

Product Support – Outsourced

Management – Inhouse Provision

Management – Inhouse

Product Support – Outsourced

Product Support – Outsourced

Management – Inhouse Provision

Management – Inhouse

Product Support – Outsourced

Product Support – Outsourced

Wireless

In-house Provision

In-House Provision

Telephony

Currently Inhouse. Provision

Distribution Switches

Edge Switches

Networks Firewalls

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In-house Provision

In-house Provision

In-house Provision

In-House Provision

Outside of IT

Management – In-house

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being reviewed and procurement for new system in process.

Operation & Administration

Network Management Software

In-house Provision

Department remit

Provision Product Support Outsourced

In-house Provision

In-house Provision. Product Support Outsourced

Maintenance & Service Provision

User Profiling & Administration, Security, Performance

Network Access/Security

In-house Provision

In-house Provision

In-house Provision

Change Control

In-house Provision

In-house Provision

In-house Provision

Hardware Management

In-house Provision

In-house Provision

In-house Provision

End Client Management Software

Set-up; Outsourced

All in-house Provision

All in-house Provision

Some in-house, outsourced where required.

Outsourced

Operation: In-house Provision

Resources and Training

Internal Training and development

Outsourced

There are a number of key areas where service provision can be shared between the three organisations. These range from operational support to alignment of hardware and technology infrastructure.

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6.13.3

Proposals for Developing the Service 3 – 6 Months ‘Quick Wins’ Training & Knowledge Transfer; Stoke FE College has in place a robust training and development plan for their technical staff. This training is undertaken on a needs basis. Both the University and Sixth Form Centre do not have such a robust process. Given all organisations are moving toward a Cisco / Windows based converged architecture, it makes good sense to have a central training function for all organisations. This would also help develop relationships between key staff. New Building Technology Integration; It appears the lead organisations in the development of each building within the new quarter are undertaking different approaches to their building design and IT integration. This approach prevents the identification of opportunities for potential shared services and commonality of infrastructure across SUQ in the future. It is suggested that discussions are held between the three institutes regarding the current status of the building design and opportunities for shared services in the future. Further to this, a common IT architecture specification should be created and accounted for within the Employers Requirements for each of the building construction projects. Active Architecture Strategy and Planning; There is a consistent approach to the deployment of Cisco / Microsoft architecture. Common principles should be agreed for the design, configuration and deployment of this infrastructure going forward. This will ease the issues of network operation in shared buildings and decrease the operational overhead associated with general management. Equipment Procurement; Agreements should be sought in the procurement of ICT goods and related services. Currently all three organisations use differing procurement frameworks. These should be streamlined and suppliers identified for specific products and services. Service Delivery Support; A working group should be set-up with technical representation from each of the stakeholders. The objective of the group is to provide technical and resource support to each organisation as specific projects and BAU technical activities are planned / undertaken. The creation and sustainability of the relationships created in this group will facilitate understanding each organisation technical architecture and operational processes. 6 – 12 Months Network Infrastructure Shared Service Agreements; All three organisations use different suppliers to support the network hardware. Commonality of service levels and a reduction in overall operational costs could be achieved via appointment of a single supplier to undertake the network hardware for all organisations. The

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importance of this will increase when the three organisations share the same building. E-Learning and Content development; Both Stoke FE College and the Sixth-Form Centre develop electronic content for publication on learning platforms. There is sufficient scope for both organisations to leverage the content provided to date and create a single learning platform for access to all students from both organisations. 12 - 24 Months ITIL Operation Standards; There is limited adoption of ITIL standards and processes across the organisations. Improvements and commonality of IT Service Delivery should be achieved through a central project to implement ITIL across all organisations. This should include central help desk services, central change management and central issued resolution. Single Sign On; Users from all organisations will be using the same computers in shared new buildings. The organisations can either create a single sign on policy or authenticate users against different independent domains. The benefits of a SSO policy should be evaluated and a technical solution created, implemented and tested to ensure functionality required by each organisation is achievable. 24 – 36 Months 1st line, 2nd line 3rd line Support; Support services to the operation and maintenance of the network are currently undertaken internally by the three separate organisations. A strategy for the collaboration of technical support should be considered. This shall enable opportunities to be identified that shall promote flexible and adaptable use of technical resources. By working together, an organisation could seek additional technical support in the event of a network incident or security threat. Furthermore, streamlined technical support would also provided more cost effective and greater coverage support during ‘out of hour’ periods, when staff availability is limited.

6.13.4

KPI’s used to manage the effectiveness of the Service A plan is required which defines specific service delivery milestones. These milestones will measure the performance of the organisations in the creation and implementation of a Network Management Shared Service. The milestones must consider the technical, operational, organisational and contractual changes of the shared service.

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6.13.5

Buildings Used by the Service All new and existing buildings will use the service. All existing equipment in buildings will require assessment and evaluation to inform whether the changes proposed by the Shared Service can be implemented.

6.13.6

Interfaces with the Shared Service The following are the key interfaces with the shared service:

6.13.7




Technical Architecture; the passive and active network architecture (types of technology) needs to be consistent across all organisations.




Operational / Support Processes; methodology implemented by each organisation (E.g. ITIL) in the management of IT. Strategic fit Staffordshire College and Sixth Form College are well placed for strategic fit. The College is well developed, has established processes and a robust technical architecture. The users are also very similar, thus provides a foundation from which the organisations can share services. The University operates a much more autonomous technical environment; however there is opportunity to implement shared services across a significant proportion of the network management function.

6.13.8

Target Users Service changes will affect the network management and IT operation functions of each organisation. General users of each organisation will notice minimal change to their interaction with technology.

6.13.9

Characteristics of the future business model (5 – 10 years) Potential for a single team who manage Network Infrastructure, the network Operation and Administration, Maintenance and Service Provision, and Resources and Training. User Profiling and Administration should be undertaken by each organisation but managed as a central team.

6.13.10 Funding overview Capital funding (from new build), annual CapEX and OpEX funding will have to be aligned between all three organisations.

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6.13.11 Benefits of ICT Shared Service The following are benefits which have been identified but not yet discussed with all stakeholders. These have been split into People, Processes, Product and Procurement.

- Defined IT Organisation - Better and more frequent Training. - Improved Network Management efficiency - More job opportunities. - Greater ability to react to changing technologies. - Greater ability to react to changing customer demands.

- Similar product roadmaps for all organisations. - Reduced TCO via OpEX savings. - Increased value through reduced supply chain. - Maximise supply chain relationships.

People

Procurement

SUQ Network Management ‘Shared’ Service

Process

Product

- Improved organisation and operational processes. - Consistent IT service across all organisations. - Specific teams for specific applications or systems. - Known metrics for operational performance.

- Defined ‘Service’ Offering across all three organisations. - Measurable technical and operational performance. - Target resources at required area for improvements.

6.13.12 Key Risks Primary risks:


Stakeholder engagement – There is a risk the primary stakeholders do not value the improvements demonstrated by the shared service structure and do not engage early enough.




Leadership – There is a risk the defined benefits will not materialise due to a lack of ownership and leadership.

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Consistent Infrastructure – There is a risk a number of benefits will be constrained due to decision being made on types of building IT infrastructure for the new campus.




Communication – There is a risk a number of benefits will be constrained due to lack of communication between the organisation stakeholders and also between the stakeholders and capital project development team.

6.13.13 Sourcing Options / Decisions Creation of a single network management support organisations. Internal sourcing from each organisation. Outsource hardware support contracts.

6.13.14 Converged ICT Estate Opportunities The converged estate provides opportunities for developing services in the following areas 1) Network and Communications


Single connectivity and management of the JANET link.




Opportunities for a additional multi-site resiliency.




Single and centralised approach to network management and monitoring




Utilisation of cross-institution IT resources to support/manage the network during academic holidays and trouble shooting periods.




Ability to share training and CPD opportunities for IT resources across the institutions.




Centralised wireless LAN for flexible connectivity across sites for students




Opportunity to deploy shared IP-enabled building services (e.g. CCTV, Access Control, VoIP, IPTV etc)

2) Building Security and Control


Centralised CCTV solution for campus wide security monitoring and management




Centralised Access Control solution to enable students and staff to securely access different sites




Opportunities for campus wide cashless catering using a standard access card

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Combined Building Management System strategy for centralised and remote monitoring

3) Active Network Architecture


Combined purchasing power




Centralised support and maintenance contracts




Ability to utilise cross-institution knowledge and experience

4) Data Centre


Shared data centre and rationalisation of space requirements




Shared facilities, providing centralised management and support.




Opportunity to combine forces for energy efficient and cost saving strategies.




Centralised support and maintenance contracts




Combined approach to business continuity and disaster recovery




Future proofing for expansion of services

5) Client Devices and Peripherals


Combined purchasing power




Centralised support and maintenance contracts




Ability to undertake renewal and refresh devices campus wide for efficient lifecycle management




Opportunity to deploy mobile devices for use across the various sites




Centralised printing strategy to enable ‘follow me’ printing and charge back across the academic estate.




Sharing best practice of the coordination of FF&E and M&E, including the usage of the most appropriate technologies to be used in spaces to achieve flexibility.

6) Learning Platforms and Applications


Collaboration and information sharing across the learning platforms

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Collaboration and information sharing across the institutions MIS




Centralised pool of learning resources and tools




Opportunity to rationalise the portfolio of applications used by the various institutions




Ability to rationalise the number of software licences for optimum usage

7) Audio Visual


Centralised audio visual solution for teaching and learning




Combined purchasing power




Centralised support and maintenance contracts




Shared video conferencing facilities and ability to purchase a more powerful solution




Opportunities for shared IP based TV distribution services to enable teaching and learning across sites




Opportunities for combined and institution specific information displays/kiosks across the campus

8) Telephony


Combined purchasing power




Centralised IP telephony solution




Centralised Call Centre for the management and routing of calls across the institutions




Reduced call charges between the institutions




Rationalisation of external communication lines and contracts




Opportunity for increased resiliency of telephony provision




Opportunity for future expansion and integration

9) Service Level Management


Centralised contract and supplier management of IT services

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Uniformed service level agreement




Centralised IT Support Help Desk

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6.14

Service Evaluation: Procurement

6.14.1

Purpose The University Quarter of Stoke-on-Trent are looking to establish what areas of their operations would be suitable for adopting a Shared Services model. Following a selection and validation exercise, procurement was one area which was felt may be suitable for being delivered as part of a shared service.

6.14.2

Approach In order to establish the feasibility of delivering procurement as part of a Shared Service centre model, a scope and readiness assessment was undertaken, which examines key areas of the current state of procurement operations. The current state analysis focuses on the following key areas:

6.14.3

•

Department Structure and Systems

•

Collaboration and use of Central Purchasing Bodies

•

Spend Reporting and Analysis

•

Governance

Current State Following information gathering via email and a subsequent workshop where representatives of the three institutions were present to provide detail on the focus areas listed above.

6.14.4

Department Structure and Systems At present there are no formal reporting lines across the three institutions. Within each organisation there are staff dedicated to procurement or procurement administration activities such as purchase order processing. The Staffordshire University has devolved the raising of Purchase Orders to staff in the various departments and faculties. However there is one full time Procurement Officer, reporting to the head of Finance, whose remit is to ensure compliance where possible, manage the supplier database, obtain quotations, and to issue Invitation to Tender documents. Within Stoke College, there is devolution of the raising and issuing of purchase orders, as only two individuals have delegated authority to issue POs on behalf of the

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College. Purchase requests are raised by individuals in the departments and faculties; however these are vetted for compliance by the two individuals who then issue the PO to the supplier. The College also has one full time Procurement Officer, who issues requests for quotations and low spend Invitations to Tender documents, as well as negotiating aspects of subsequent responses. As with the Staffordshire University, the 6th Form College has a devolved authority on the issuing of POs to budget holders throughout the College, however the value of the respective PO that can be issued is governed by a series of thresholds, which in turn determines who finally vets each PO. The 6th Form College has no dedicated Procurement Officer; however one individual has purchase ledger responsibilities, as part of their day to day activities. At present all three organisations operate on different purchase order generation and processing systems, with the 6th Form College and Stoke College both operating with paper-based systems. In order to deliver procurement as part of shared service centre across the three institutions, a unified and electronic purchase order generation and issuing system would require implementation to some degree. In terms of staff numbers, the combined 3rd party spend of the three institutions, around £28m per annum, would typically justify the number of individuals currently engaged in Procurement activity on a full time basis, however in the absence of data on transaction numbers, it is impossible to provide an exact figure on the staff numbers required, in the event of a shared service centre being established. Indeed, the same can be said for the complexity of the electronic purchase order management system required, in that with the absence of data on the amount of POs processed and the type of procurement undertaken, no recommendation could be made without further, more detailed investigation. Finally, at present none of the staff engaged in procurement undertake pro-active strategic sourcing activity based on spend analysis. For a shared service centre model to be applied, the level of 3rd party spend being addressed would merit someone undertaking this activity on a more regular, or indeed full time basis.

6.14.5

Collaboration and the Use of Central Purchasing Bodies There have been limited occasions where all three institutions have collaborated on procurement matters, the most notable occasion being some informal collaboration on the procurement of HR Software.

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However, there is a good degree of utilisation of frameworks, such as those provided by the OGC and Staffordshire County Council and collaboration with central purchasing bodies such as North West Procurement Consortium and the CPC Consortium. Despite a history of some informal collaboration, there remains significant spend on commodities where each institution sources in isolation. For example, each institution is currently sourcing energy provision separately. Energy, like other high spend commodities, could benefit from a more collaborative approach which would increase the leverage the combined spend would bring. Also while it is important to be aware of what is available through frameworks, these should not be seen a sourcing solution in their own right, as prices quoted in such frameworks may have fallen since their availability. A dedicated procurement or commodity professional, working as part of a shared resource, would use any frameworks as a benchmark, forming part of the sourcing strategy and subsequent sourcing decision.

6.14.6

Spend Reporting and Analysis. All institutions were able to provide an approximate value of their influencable* 3rd party spend as follows: Staffordshire University with £11m, Stoke College with £8.2 and Stoke 6th Form College with £1m. However the levels of detail of spend provided was limited. Staffordshire University were able to provide a spend–by-supplier breakdown and Stoke College, a spend-bycommodity group. Having a completely paper based system, Stoke 6th Form College were not able to provide any form of spend breakdown; however, this could be produced if so required, although it would be a very labour intensive exercise. The availability of detailed spend information is essential in the preparation of an effective procurement strategy and attention should be paid as to how it can be used to aid any pro-active sourcing activity. The presence of a more automated, electronic purchasing management tool would be essential if the University Quarter were to move to a Shared Service model for procurement. However based on the data provided on spend by commodity for the three institutions, the following spend by commodity profile can be drawn up.

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Spend by Commodity (Stoke College, Stoke 6th Form & Univ. of Staffordshire) £3,500,000

6.14.7

£3,000,000 Spend

£2,500,000 £2,000,000 £1,500,000 £1,000,000 £500,000 Registration Fees & Educational Educational Visits Student Travel Postages Trainee Payments Rates Hospitality Water Services Non-Educational Office Copying & Printing Learning Resources Recruitment Costs Insurance Retail Cost of Sales Telecommunications Residential Courses Staff Travel & Provisions Staff Development Rent & Hire of Teaching Materials Computer Energy Costs Cleaning Publicity & Promotion Repairs & Hired & Contracted

Governors Expenses Miscellaneous Vehicle Running Staff Welfare Clothing & Laundry Contract Vehicle Hire

£0

Commodity

Those commodities listed to the left of the dotted red line are high spend commodities which have the biggest potential for benefits yield. As the above profile is constructed using actual spend by commodity for Stoke College and subsequent spends for Staffordshire University and Stoke 6th Form College calculated on a pro rata basis, these are commodities where a more collaborative approach could be adopted, even in the absence of the three institutions working via the same purchase order management and process system. The spend by supplier data provided by the Staffordshire University further serves to highlight the opportunities of adopting a more collaborative approach Spend by Supplier - University of Staffordshire £500,000 £450,000 £400,000 £350,000 £300,000 £250,000 £200,000 £150,000 £100,000 £50,000 £0 Supplier

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The above graph shows a large supplier tail, accounting for a total of 777 suppliers, many of who will be common across the three institutions and many supplying the same goods or services. By obtaining this data for all three institutions and adopting a collaborative approach a cohesive procurement strategy can be formulated which would include the following activity: •

Migration to best price across common suppliers

•

Supply Base Rationalisation

•

Leverage Negotiations

•

Go to Market

•

Benchmarking

In addition, these key, high spend commodities could be assigned a management structure from the following:

Attributes

Description

Model

Centralized Procurement Site All procurement at centre with minimal site presence

 Leverage/strategic

Strategic Teams Site

Outsource New Co

Site

Lead Site Buying Lead Site

Site

Procurement

Procurement

Commodities are sourced centrally and managed by cross functional team

Sourcing responsibility is delegated to an outside firm

Country responsible for sourcing a commodity on behalf of the other Countries

 Lack of external  Potential risk  Reduce internal

 Competing

 Strategic core at focus centre define policy, define strategy and  Sharing of best negotiate groupwide practices  Resource deals allocation/flexibility  Sites responsible for  Lower costs local call off,  Better standardization negotiation, supplier  Common external interface, image to suppliers transactional processes

Decentralized

control

headcount  Achieve leverage  Focus on core

competency

79

No formal centre but all reporting functionally

 Speed

responsibility  Access to local skills  Part time role  Knowledge of local plant  Questionable buy-in

of response/flexibility  Knowledge of local procedures & requirements  Raised awareness of procurement  Low value commodities better handled at local level  Greater accountability  Knowledge of local plant

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The key commodities, such as those listed to the left of the red line in the spend-bycommodity graph, would adopt the centralised model, with lower level spend commodities following the strategic teams model. At present the lack of availability of spend data has had an effect, in that no proactive procurement is undertaken, which in turn provides reason as to the lack of a formal procurement strategy being present in any of the institutions. Therefore, with the current state of procurement operations in the three institutions as they are, there is scope for a more collaborative approach to procurement, provided best practice procurement methodology is applied.

6.14.8

Governance. All three institutions operate procurement under the governance of a procurement manual, be it as a stand alone document as in the Staffordshire University or as part of the financial procedures. The strict vetting of purchase requests at Stoke College and Stoke 6th Form College and limitation of purchase order issuing at these institutions would suggest that governance is robust and in line with delegated authority. The Staffordshire University has devolved the issuing of purchase orders to various departments, which is a relatively low risk approach provided those issuing purchase orders are familiar with the governance outlined in the procurement manual. However there is anecdotal evidence of maverick spend and there is little control or vetting as to what suppliers are included on the supplier database. A more centralised approach in this respect for key commodities would increase compliance and reduce off-contract spend, ensuring that negotiated benefits and discounts are captured.

6.14.9

Conclusions & Recommendations At present, procurement within the Staffordshire University, Stoke College and Stoke 6th Form College is reasonably robust, in terms of structure, processes and governance. While there are obstacles in adopting a Shared Services model for procurement across the University Quarter, they are not insurmountable. The main constraints centre on the following: Level of Spend: With an approximate combined, influencable 3rd party spend of £20m, the setting up of a completely new procurement hub would not typically be merited.

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Purchase Order System: A common automated system would assist in the provision of spend data for analysis for all three institutions – a key factor in the preparation of an effective procurement strategy. Lack of Data: Very symptomatic of the lack of a purchase order system, in that all data collation is labour intensive, however accurate data would enhance and provide more credence to any business case for further investment in a purchase order system and staff. If the three institutions were to adopt a more collaborative approach to procurement in the short to medium term, a more accurate business case could be made for, or against moving to a Shared Service model for procurement delivery. Adopting this approach, along with best practice procurement and sourcing methodology would deliver benefits form an early stage, as well as providing a platform to explore further options on which delivery model procurement will adopt in future. By obtaining this data for all three institutions and adopting a collaborative approach a cohesive procurement strategy can be formulated which would include the following activity:


Migration to best price across common suppliers




Supply Base Rationalisation




Leverage Negotiations




Go to Market




Benchmarking

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7

Options Appraisal

7.1

Purpose The purpose of this stage is to deliver an appraisal of options on the basis of their acceptability, feasibility and suitability. This stage of the project combines objective analysis with engagement of senior management teams to identify the options that are suitable to be included in the Pilot Study.

7.2

Statement of Business Problem The city of Stoke-on-Trent ranks as the 22nd most deprived local authority and has a culture of low skills, low educational attainment and low aspiration. To tackle these serious issues, the University, working with its two neighbouring FE partners, has forged the vision of a University Quarter, which will drive educational achievement through a unique model of integrated curriculum and shared facilities, teaching and administrative resource. The University Quarter is a key regeneration project for Stoke-on-Trent and North Staffordshire as a whole. The overriding mission of the Quarter is education-led regeneration, designed to significantly raise the level of skills and qualifications in the City, making the City a more attractive and competitive location for inward investment. The University Quarter partners are in close physical proximity and, as a result of the work that will be undertaken through the University Quarter project, are currently preparing proposals for the construction and sharing of five major buildings. With the development of these shared facilities it is now imperative that the partners move towards more formalised arrangements for shared services with a real commitment to make this happen. In June 2006 an Education and Skills Sector Plan was produced to help the DfES Efficiency and Reform board to optimise returns on shared services investments and guide future investment decisions. Within this Plan the key benefits of shared services were summarised and it is these benefits that the University Quarter will strive to achieve through its own shared services provision:


Increased efficiency and effectiveness (value for money)




Increased flexibility




Standardisation




Improved service effectiveness

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7.3




Improved procurement




Improved sustainability




Better information and data




Performance and measurement




Enhanced capability.

Defining Success for Shared Services The partners defined success for the Stoke University Quarter shared services as:


Improved economic efficiency – value for money




Curriculum integration – improved progression




Linked campuses – separate identity, shared facilities




Access to more facilities – more easily available to all students




Intelligent IT infrastructure, making content available across organisations




More professional support services




Extending the partnership - working with Stoke-on-Trent Council and other partners




Drive for innovation and learning in the City




Consistency across organisations




Service delivery to be consistently as good as the best

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7.4

Case for Change The section on learning set out the need for successful change programmes to be underpinned by a clear rationale for change. The EFSG developed the following themes as reasons to implement the changes required to achieve the full benefits from Stoke University Quarter. Working together as part of the University Quarter will enable us to:

7.5




Do the right thing for the city by securing the future for the people of Stokeon-Trent




Contribution to regeneration of the city securing local jobs for local people




Provide better services and facilities which will make us more competitive and attract the private sector

Developing a Vision for Shared Services The vision for the University Quarter is: “The University Quarter in Stoke-on-Trent will generate a thriving knowledge economy that is globally connected leading to sustainable prosperity and an ambitious and dynamic community. It will create an integrated learning experience, focussed upon creativity, skills and employability, promoting participation and progression.” The EFSG endorsed the vision for Shared Services developed by senior managers: “We will improve our customers’ experience and support the delivery of the University Quarter through efficient and effective shared services. We will measure our progress through improvements in customer satisfaction and value for money.”

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7.6

Business Objectives and Critical Success Factors The following table identifies the business needs to be addressed by future Shared Services initiatives, and gives an indication of suitable critical success factors.

Business Need

Critical Success Factor

By When (if applicable)

The University Quarter project is making a significant investment in the region. Funding for this investment is by means of a loan. The savings made by sharing services are anticipated to contribute to the repayments on this loan.

Reduction of service provision costs (compared against costs of 2007/8 service provision)

1 year from project commencement.

Phase 2 of cost savings - As above, for medium term savings.

Further cost saving

2 years from project commencement.

Phase 3 of cost savings – As above, for long term savings.

Further cost saving

10 years from project commencement.

Improve customer service.

Increase in student satisfaction survey performance

3 years from project commencement.

Standardisation of service offerings for shared services being developed

Agreed standard processes for service provision and performance reporting (100% agreement by all partners).

2 months prior to shared service golive date.

No reduction in service performance.

Service performance degradation is not noticeable to the end user (measured by number of specific complaints).

Measure 1 month after shared service go-live date.

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7.7

Challenges to delivering effective shared services The partners need to maintain independence, and there is some perceived competition for attracting students which could result in significant challenges to implementing shared services. The services considered by this report show that this should not be an insurmountable barrier as there is evidence that the partners already informally cooperate very effectively in a number of areas. Other significant challenges are likely to include2:


People – should staff be seconded or transferred under the Transfer of Undertakings (Protection of Employment) Regulations 1981 and 2006 (TUPE) regulations into any new entity established? How should organisations deal with laws, regulations and cultural issues? Institutions implementing shared services need to plan carefully at an early stage. Strong leadership and good communications are vital from the very beginning.




Technology – different systems with different operating practices and skill sets. Maintaining information integrity whilst integrating systems is important. Use of common systems is not a prerequisite for shared services, although it will most likely have a significant impact on long-term efficiencies.




Processes – how can commonality be provided for a group of potentially diverse organisations whilst providing the necessary flexibility for genuine differences?




Accommodation – considerable efficiency gains are possible from implementing a virtual shared services solution that does not require physical relocation but uses ICT to pool resources in common systems and applications.




Governance and accountability – these are vital in publicly funded organisations such as HEIs and accountability mechanisms need to be appropriate. The use of different models (joint venture companies, joint committees, limited liability partnerships) brings different legal challenges.




Affordability – redundancy or severance costs, one-off capital investments in premises or new systems and the need for consultancy support means that

2

Extract from KPMG report to HEFCE July 2006.

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paybacks are rarely achieved in less than three years (unless they are written into contracts with a third party provider as with the NHS/Xansa agreement).


Stakeholders – potential impact on students, local businesses, funding bodies. Any downturn in performance, even in the short term, could have a significant impact. One final challenge is the need to ensure real commitment to a shared service arrangement by all participants. If participants, including funders, were able to leave such an arrangement or cut back their contribution at short notice this could have an adverse effect on the service provided to others (a recent example is the decision by the Learning and Skills Council to reduce its funding to JISC, which has impacted on the services that JISC can now deliver in ways which go beyond the simple proportionate reduction in the service but that is having an impact across the whole service because of the integrated nature of services). It is therefore important to ensure agreements cover the orderly withdrawal of participants.

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7.8

Developing Shared Services – Strengths and Weaknesses Strengths

Weaknesses

Strategy

Loss of competitive advantage Loss of branding autonomy Existence of non-standard patterns of operation.

Variable fees Customer demands Quality provision Sharing risk Best value Skills and competencies

No recent experience of change A "conservative" community.

Local recruitment issues Different pay scales Fear of not delivering - do we have the required skills to deliver? Organisation

Difference in governance arrangements HEFCE / LSC external accountability Different performance management structures Different management and leadership styles Threat of outsourcing

Clear management leadership of shared service Clear accountability Common purpose

Culture Willingness to collaborate Culture of the University Quarter Strong team identities Partners not fighting over same turf historically Information systems and Technologies

‘Bigger the systems the greater the risk’

Commonality of systems Pace of IT change. Need of common architectures & processes for shared buildings. Processes Timing - different peaks and troughs Academic year shape different between partners

88

Similar process but different in IT systems Risk of service losing sense of place and brand

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7.9

Develop the approach for Options Appraisal The shortlist that was developed from the previous stages was assessed using the following criteria:

Evaluation

Issues Considered

Feasibility

Market Assessment Investment Required Return on Investment Timescale for Return on Investment Tax and VAT implications of proposed options

Acceptability

Alignment with vision for University Quarter Alignment with culture of organisations Management arrangements for staff Opportunity costs of proposed arrangements

Suitability

Ability to integrate governance models within existing structures Impact on educational attainment & progression Risk to individual organisations Risk to University Quarter

The following table aggregates the scores for each of the short listed services, using the rating system: 1: Poor match. 2: Moderate match. 3: Good match. Each of the scores is then added together to produce the overall score. This score then provides a quantitative assessment of the viability of implementing each service, and has been used as the basis for identifying and agreeing which services to move forward in the short term. For ease of reading the top scoring services have been highlighted yellow. It should be noted that the table shows all of the options which have been considered for the short to medium term. Those without the highest score should be considered for later initiatives.

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7.10

Output of Options Appraisal

Service Description Procurement

Feasibility Short term benefits from increased collaborative buying power.

Network Management

Needed for UQ, for those sharing buildings (assumed part of UQ budget).

Telecoms

Needed for UQ, for those sharing buildings (assumed part of UQ budget).

Buildings Maintenance

Suggest a review in the short term!

Cleaning

Review of services needed.

Parking Mgt

Minimal investment Reqd.

Security

Potential changes needed as part of UQ – partial funding may be available.

Creche / childcare

Possible revenue generation. Pooling resources would bring benefits.

Groundskeeping

Minimal investment if timed with contract renewals.

Porterage

Not recommended in short to medium term.

Acceptability Common purchase order system may be needed in longer term. Common systems architecture needed – may result in staff training Common systems architecture needed – may result in staff training Currently under review in University.

University - In House, remainder outsourced. TUPE issues for transferring staff. TUPE issues for transferring staff. Site development will increase parking pressure In-house during the day and outsourced at night (different providers). Shortage of available places.

University inhouse, others outsourced. TUPE issues for transferring staff. Current staff experienced with each of the partners needs.

90

Suitability Minor obstacles, not insurmountable.

Overall Score 9

Management arrangements can be simplified.

9

Management arrangements can be simplified.

9

Health & Safety management would benefit from immediate pooling / sharing. Unlikely to yield significant savings

8

Work needed as th incorporation of 6 Fm will increase pressure on current parking. Suppliers need to know how to work in these types of academic environment. Would contribute to student attraction. Provision needed for th 6 Fm (was at Fenton Manor). No perceived major problems.

Change is likely to be resisted, as staff have good working relationships.

4

9

9

9

6

3

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Service Description Catering

Counselling Support Chaplaincy

Feasibility

&

Funding restrictions.

Disability Support

Careers Employment

University funding rules to change in 2010.

/

Ground Sharing expertise

Pre-entry Advice

Currently the College is financially viable Funding restrictions.

Need to consider working arrangements with external providers. Sharing experience should have minimal cost implications.

Clear benefits for sharing best practice and co-ordinating curriculum offerings.

Acceptability th

6 Fm – Outsourced. Others – in-house. Presence reqd. on each site. Not currently provided for th College & 6 Fm. Unpaid resources would have more workload. Students reluctant to travel. University currently outsourced. Differing skills for each partner.

Unlikely to be received badly.

Would need to be clear about differentiators. College team currently being reorganised. Likely to meet with significant resistance.

91

Suitability Minimal risk & impact.

Overall Score 6

Staff training will be needed if shared. No perceived disadvantages (except cost).

5

May be disparities in performance measures.

3

Should facilitate easier movement of students between partners. Minimal risk. Not much evidenced experience of working in a shared environment. Need to keep identity of each partner. Perceived competition for attracting students.

6

3

8

6

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7.11

Recommended Services to take forward

7.11.1

Childcare Currently demand is outstripping supply. Each partner either has a facility, or access to one nearby. The partners have indicated that this service would benefit from early consideration for sharing and that there would appear to be some merit in splitting provision between babies and children. It is recommended that a feasibility assessment is undertaken to assess the potential to develop a shared childcare facility as a priority.

7.11.2

Health & Safety Management (& Environment) The Health, Safety & Environment role for each establishment, is included in the Estates Services departments. The role tends to be one of a specialist nature and it is believed that sharing this service would benefit all the partners.

7.11.3

Parking Management Parking Management and Security Services appear to be two very closely linked services at all three education campuses. There are in-house teams employed at all three establishments. Costs associated with this service were available for Stoke College only - £180k (as the 6th Form College include their costs in their Security Service and the Staffordshire University had only advised of a total departmental cost of £5.6M). All three education environments appear to experience the same type of problems with parking management, i.e. problematic car parking and limited measures or policy available to assist. In the short term the parking management issues could be addressed (probably in tandem with security services) as a bespoke service area for all three education establishments, or indeed on an individual establishment basis. However, taking account of the new Stoke University Quarter Campus, and the changes to buildings, potentially the increased numbers of personnel within them, the logistics of parking management, etc, a medium – long term review would be beneficial.

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7.11.4

Security Services Security services are all in-house staff during the core daytime hours, and then outsourced during the evenings – to separate contracted security providers for each establishment. Costs for these services were difficult to ascertain, as they appear inclusive within the Parking Management Services though for the 6th Form College a cost of £20k was stated, Stoke College were able to advise of costs of £180k and part of the overall £5.6M departmental budget for Staffordshire University covered this Service. In the short term the security services could be addressed (in tandem with parking management) as a bespoke service area for all three education establishments, or indeed on an individual establishment basis. However, taking account of the new Stoke University Quarter Campus, and the changes to buildings, potentially the numbers of personnel within them, changes to what and whom need security measures etc, and a medium to long term review would be beneficial.

7.11.5

ICT – Common Architecture Whilst the pre-existing scale of shared service in the IT area with JISC, MANs, JANET etc should be recognised, there are significant challenges in developing a shared service; however urgent collaboration is required to ensure that the infrastructure of the shared facilities meets the requirements of all the partners. In addition collaboration specifically around arrangements for disaster recovery and long term document retention seems attractive to all partners.

7.11.6

Procurement At present, procurement within the Staffordshire University, Stoke College and Stoke 6th Form College is reasonably robust, in terms of structure, processes and governance. While there are obstacles in adopting a Shared Services model for procurement across the University Quarter, they are not insurmountable. If the three institutions were to adopt a more collaborative approach to procurement in the short to medium term, a more accurate business case could be made for, or against, moving to a Shared Service model for procurement delivery. Adopting a collaborative approach, along with best practice procurement and sourcing methodology would deliver benefits form an early stage, as well as providing a platform to explore further options on which delivery model should be adopted for procurement in future.

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7.12

Indicative Costs and Benefits The limited financial information provided by the partners has meant that it has not been possible to develop a model of lifetime support and running costs for any of the proposed shared services.

7.12.1

Benefits Claims for cost savings for shared service schemes vary, but it is argued that successful shared services implementations can generate up to 30-50% cost reduction in the private sector and 20-30% in the public sector. Depending on the service, savings may result from:


Lower capital costs.




Lower development costs.




Reduced software maintenance costs and system support costs.




Rationalisation of accommodation, leading to sale of surplus assets.




Improved commercial bargaining power for procurement.




The avoidance of duplication.




Increased efficiency from standardised processes and technologies (including common ICT and shared platforms).




Lower personnel costs.




Increased student perception of the partner / University Quarter.

In addition to pure cost savings, other benefits include:


Improved service, leading to improved customer experience, as a result of greater focus and skills in the shared service centre, and the opportunity to reorganise services around the customer.




Improved morale amongst staff providing the shared services.




Senior management focusing their attention on adding value, rather than transaction processing activities.




Greater resilience from a wider base and more staff with key skills for the specific services.

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7.12.2




Shared training and development opportunities for staff.




A foundation for trading or expansion to other bodies.

Business and IT Costs The following areas will need further investigation, prior to commencement of the project:

7.12.3




The level and cost of current provision in partner institutions




Costs for the proposed changes – outline costs for development & operational running




Total project cost.

VAT implications A potentially critical issue for the feasibility assessment and any future work to look at validity of business cases is the likelihood of an enhanced liability for VAT through the introduction of shared services. If shared services are provided by a third party in the case of a separate legal entity or one partner providing the services to the others, there is a potential for an additional VAT cost to be created, since the University would only be able to recover input tax in line with its partial exemption method and would need to seek to charge the other partners on the irrecoverable VAT as part of the recharge. As this would be a taxable supply VAT would be charged on the total recharged amount, including the irrecoverable VAT. There may be a way of mitigating this apparent liability if the partners form an unincorporated association, however, as this topic is subject to frequent legal change and challenge we would recommend that the partners seek specialist advice.

7.12.4

Payback Further work is needed on assessment of costs, benefits and payback profile of a shared service provision.

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8 8.1

Next Steps Purpose To provide practical recommendations for implementing shared services between the education partners.

8.2

Moving On - Business Architecture Model As part of the enabling work for each shared service, it will be necessary to generate a Business Architecture Model. The Business Architecture Model will need to focus on the essential things that the partners have to do, leaving the design of how they are done as a later decision. The architecture will need to use a common language to provide a management tool that will enable a holistic view of:


each organisation,




the work it undertakes,




the roles that undertake it,




the interfaces that currently exist (or will need to be created).

Using this architecture the partners can identify areas of duplication of function, activity or subject matter and record an information profile. This single view of the business needs will enable senior managers to make informed decisions about how to enable better use of resources and deliver a greater focus on customer needs. The following outline Business Architecture Model shows the main areas that will were considered as part of the feasibility study.

Facilities Student Mgt. Services ICT Finance

Stoke UQ Marketing

Legal

HR

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8.3

Developing Projects The proposed Shared Services Programme will result in the development of a number of discrete projects. Each project will be focussed on identifying the scope, development and delivery of a specific shared service. For each discrete project the following context diagram will apply:

Partner 1 will take the lead role for the project and ongoing service delivery, whilst the remaining partners (2 and 3) will form the end users of the service, and prior to migration, will take the role of project assurance. After migration the partners will assume the role of client and will predominantly concentrate on service review, performance monitoring and service development. For each project (i.e. delivery of each discrete service), the early phase of the project will identify which partner is best suited to take the lead partner role (i.e. Partner 1 on the above diagram) and will identify which service model is best suited. The shared service business would have its own budget and account to its “parent/partner” organisations (and potentially a private sector partner) for its use and report on the performance achieved from the use of that budget. It is worth noting that the partners may start with one service model and migrate to others as the shared service matures and a better understanding of governance and roles and responsibilities is gained.

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8.4

Proposed Governance & Management The proposed governance structure for management of the services is as follows:

Shared Services Steering Group

Shared Service A

Shared Service B

Assurance

Shared Service C

In this model all partners would be represented in the Steering Group at a senior level. At the next level (i.e Shared Service A) the lead partner will take the dominant (delivery focussed) role and the other partners will take the role of business change management and performance monitoring. The Steering Group will commission project reviews to provide assurance that each service is designed for and will deliver the appropriate business functions. This role will also be responsible for investigation and resolution of any decline in service levels or disputes over performance.

8.5

Proposed Funding Model Because of the differing models for sharing services it is not possible to determine an appropriate funding model at this stage. It is understood that funding models are being evaluated for the new shared occupancy buildings and it is anticipated that a similar model is likely to be acceptable for each of the shared services as they are developed.

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8.6

How to deliver a successful shared services programme There are a variety of planning models available for achieving effective shared services. All of them have a number of stages which any institution wishing to implement a shared service programme will have to go through: 1. Establish a clear and realistic vision – setting out the role of the shared services operation, the role of existing functions which remain local, the balance between cost reduction and service improvements. 2. Prepare a business case – which should detail customer requirements, identify the appropriate structure, identify likely efficiencies, taking into account short-term increases in costs, set a realistic timeframe, and agree how benefits are to be allocated between customer/provider. 3. Communicate to staff and stakeholders, gaining buy-in before proceeding. 4. Establish clear targets (on e.g. time, cost and quality) and reporting arrangements, including penalties for non-performance. 5. Establish sound governance arrangements which all stakeholders are comfortable with. When the initiative is complete, best practice guidance indicates the need for a ‘Lessons Learned’ activity, where problems and difficulties encountered during the initiative are captured and shared amongst the partners as appropriate. The following process map shows an eight step approach, identifying how the programme could migrate from the current ‘As-Is’ state to the completion of the programme.

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8.6.1

Process for establishing shared service programme

8.7

Risk Management There are significant risks in implementing an ambitious change programme and best practice would suggest that a risk review is carried out and a risk management system established prior to significant investment of time and resources.

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8.8

Implementation Timescales The following actions are recommended over the coming 12 months to build momentum and build on the shared services:


Confirm Shared Services projects to be taken forward:

March 2009




Formalise remit and structure of EFSG:

April 2009




Complete shared review of procurement spend:

May 2009




Agree remit and Project Initiation Documents for projects:

May 2009




Establishment of project teams for Shared Services:

June 2009




Develop detailed financial information for projects:

Sept 2009




Detailed scoping of each service requirements:

Sept 2009

Delivery of Quick Wins:


Shared approach for Health & Safety

June 2009




Approved Plan for shared Nursery / Crèche for SUQ:

Dec 2009




Approved Plan for shared development of IT

Sept 2009




Implementation of shared service for security & parking:

March 2010

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