Support for shared services agenda

Shared services mean different things to different people. Take these three definitions from the recent Shared Services Survey published last month: “It is where a number of organisations agree to form a consortium to provide common services, normally back office functions.”

“It is where local authority departments are working together for their mutual benefit to provide a service which will reduce costs to a taxpayer.”

“It is the pooling of resources, be that money, people, assets or any other kind of resources, in terms of delivery of service to a common group of customers.”

Within the survey 83% of local authority managers in adults’ services recognised the potential for efficiency savings in procurement – although social care and education managers were less enthusiastic.

Arrangements for delivering services are often informal and not governed by any particular contractual arrangements, but by legislation and regulations instead.

Many senior and middle managers in health and social care believe their organisations have gone as far as they can in taking part in shared services initiatives. In social care 41% of respondents were not planning to take part in any further shared services initiatives and in health this rose to 45%.

A three-year study Partnership and Regulation in Adult Protection published last year by the University of Sheffield said adult protection was a difficult area to investigate. The study examined the nature of inter-agency work, its prevalence, and looked at both the advantages and potential barriers to a “partnership approach”.

The Sheffield report highlighted that multi-agency working was viewed as time-consuming, hard to co-ordinate and a difficult means by which to reach consensus decisions. It was also pointed out that there is a significant variance in the degree of involvement each agency had in adult protection.

That is always going to be a challenge when organisations work together in ­informal collaborations.

According to the Shared Services survey, 80% of social care public sector managers have delivered services in informal collaborations and 49% of them were fearful of the dangers of poorly drafted contracts. The survey also showed that managers’ concerns were about adequate financial resources with lack of staff a close second.

Public authorities reported there was some opposition to the shared services agenda, with 32% of respondents feeling their workforce opposed it. In social care and education this figure dropped significantly: only 12% believed their workforce opposed shared services.

This is probably because this sector has led on, and seen effective delivery of, services in a multi-agency context for many years. Nevertheless, a robust communication and consultation strategy will be key to effective implementation of this agenda. At least one survey has shown that bad management, low morale and poor training can cost organisations 117 lost working days a year on average.

Procurement risks are seen as especially high for managers in this sector. About seven in 10 managers see procurement as a significant concern, compared with only 47% of health managers. There were also concerns that shared services schemes may not be viable if one partner withdraws, or if there is a serious disagreement. Formalising agreements where possible and clarifying responsibilities as well as the steps to be taken in order to resolve a dispute will reduce the risks.

Taking on responsibilities for other organisations’ services is a concern raised by more than half the managers in the social care and education sector. This is why a clear and cost-effective strategy needs to be in place, so that it can be easily implemented in the event of the need for withdrawal. This should minimise the impact on delivery of the service.

Procurement problems can be overcome by ensuring compliance with EU procurement directives, domestic legislation and contract procedure rules. Agree exactly what you want with your procuring partner authorities before you do anything.

Our experience is that sometimes procurements are started with only a vague agreement of what the partners want – halfway down the line they realise they want different things.

Agree and record in writing who is going to carry out the procurement. Set what each party is going to do and with what resources. Incorporate useable performance monitoring and payment arrangements, and make sure they are properly adhered to at your end. Ensure the whole process is documented and recorded, and that all key documents are signed, dated and retained.

You should behave reasonably, fairly and even-handedly throughout the process, to avoid being challenged by judicial review.

It is important that the workforce are on your side, so take time to bring them with you. So, do not short-cut the planning. Identify your objectives at the outset and implement a realistic timetable ensuring compliance with all regulatory and other legal requirements. Develop a joint communications strategy to be agreed by all participating authorities and consult widely across all levels – make it clear that redundancies are a last resort.

Ensure that sufficient training is available for incoming staff and those who may require new skills. And if relocating employees determine what temporary accommodation might be needed and whether there needs to be a lead-in time for fit-out works.

To ensure you have perfect partnerships, identify partners your organisation can work with and with which you share a common vision and ethos. Formalise arrangements where possible. Agree each partner’s targets in terms of people, process and client measures.

Shared agreement should make it clear how costs, risks and rewards are to be shared among the partners. Make sure a flexible and practical exit strategy is in place. It should be flexible enough to allow partners to join or re-join later.

Contract documentation should specify who will make key decisions and the mechanisms in place in case of disagreement.

And finally, aim for equality: unsuccessful partnerships suffer from power struggles between personalities. Ensure that governance is correct and devolves power to an appropriate board or committee.

• Sarah Erwin-Jones is a partner at law firm Browne Jacobson and she specialises in social services, the care sector and legal costs along with education

• For more information on Browne Jacobson’s Shared Services Survey contact serwin@brownejacobson.com, or phone 01159 766136, or visit www.brownejacobson.com/sharedservices

• For more on the Browne Jacobson survey go to www.communitycare.co.uk/108170

• To see the Sheffield study Partnership and Regulation in Adult Protection: The Effectiveness of Multi-agency Working and the Regulatory Framework in Adult Protection, go to www.prap.group.chef.ac.uk