Strategic Partnering Taskforce Rethinking Service...

Strategic Partnering Taskforce

Rethinking Service Delivery

Volume Five Making the Partnership a Success

Strategic Partnering Taskforce

Rethinking Service DeliveryVolume Five Making the Partnership a Success

February 2004

http://www.detr.gov.uk/

Office of the Deputy Prime Minister

Office of the Deputy Prime MinisterEland HouseBressenden PlaceLondon SW1E 5DUTelephone 020 7944 3000Internet service www.odpm.gov.uk

© Crown copyright 2004.

Copyright in the typographical arrangement and design rests with the Crown.

This publication (excluding the Royal Arms and logos) may be reproduced free of charge in any formator medium provided that it is reproduced accurately and not used in a misleading context. Thematerial must be acknowledged as Crown copyright with the title and source of the publicationspecified.

Further copies of this report are available from:

Kevin DaviesODPM3/A6, Eland HouseBressenden PlaceLondon SW1E 5DUTel: 020 7944 5190 Fax: 020 7944 4099E-mail: [email protected]

Published by the Office of the Deputy Prime Minister. Printed in the UK, February 2004 on materialcontaining 100% post-consumer waste.

SPT – Volume Five: Rethinking Service Delivery Page 3

Contents

PREFACE....................................................................................................................................................5

GLOSSARY.................................................................................................................................................9

1.INTRODUCTION..................................................................................................................................14

PEOPLE AND CHANGE..................................................................................................................................15POLITICAL LEADERSHIP ..............................................................................................................................15THE FORMAT OF THE GUIDANCE .................................................................................................................16

2.TRANSITION AND CONTRACT START-UP..................................................................................17

TRANSFER OF STAFF....................................................................................................................................18TRANSFER OF ASSETS..................................................................................................................................19TRANSFER OF PROPERTY.............................................................................................................................20DUE DILIGENCE ...........................................................................................................................................20LEARNING POINTS .......................................................................................................................................24

3.STRUCTURES FOR PARTNERSHIP MANAGEMENT.................................................................26

STRATEGIC ..................................................................................................................................................27MANAGEMENT ............................................................................................................................................28OPERATIONS................................................................................................................................................34LEARNING POINTS .......................................................................................................................................37

4.THE ROLE OF ELECTED MEMBERS.............................................................................................38

LEARNING POINTS .......................................................................................................................................41

5.ELECTED MEMBERS AND ACCOUNTABILITY ........................................................................42

LEARNING POINTS .......................................................................................................................................45

6.REVIEW AND EVALUATION ..........................................................................................................46

LEARNING POINTS .......................................................................................................................................49


7.RELATIONSHIP MANAGEMENT ...................................................................................................50

SUCCESSION PLANNING...............................................................................................................................50TRUST..........................................................................................................................................................51CULTURE .....................................................................................................................................................53INCREMENTAL PARTNERING .......................................................................................................................54MANAGING CHANGE ...................................................................................................................................57LEARNING POINTS .......................................................................................................................................61

8.THE CLIENT FUNCTION ..................................................................................................................62

ORGANISATIONAL DEVELOPMENT ..............................................................................................................66LEARNING POINTS .......................................................................................................................................67

9.PERFORMANCE MANAGEMENT AND OUTCOME MEASURES ...........................................68

MONITORING PERFORMANCE......................................................................................................................69SPECIFICATION AND PERFORMANCE MEASURES.........................................................................................70MEASURES FOR PERFORMANCE ..................................................................................................................71MEASURING SUCCESS .................................................................................................................................77OUTCOME MONITORING ..............................................................................................................................82LEARNING POINTS .......................................................................................................................................83

10.DISPUTE RESOLUTION ..................................................................................................................84

LEARNING POINTS .......................................................................................................................................86

11.EXIT STRATEGIES – PLANNING THE END ..............................................................................87

OPTIONS ON EXIT ........................................................................................................................................89LEARNING POINTS .......................................................................................................................................89THE SHARED PRIORITIES.............................................................................................................................90

INDEX........................................................................................................................................................91


Preface

Strategic Service Delivery Partnerships (SSPs) have emerged, not through central direction, but as

initiatives of the leaders and senior executives of innovative local authorities. They are indicators of

significant changes in the behaviour and culture of those local authorities and indicate that authorities

are becoming less inward-looking and protectionist and more sharply focused on identifying and

satisfying the needs of citizens in an efficient and effective manner.

The Strategic Partnering Taskforce (Taskforce) was established in September 2001 to support local

authorities that wished to implement strategic service delivery partnerships. The Taskforce is part of the

Office of the Deputy Prime Minister (ODPM) and has a responsibility to carry out an active research

programme and disseminate information in respect of partnering and improved service delivery.

The work of the Taskforce represents part of the national strategy to provide firm foundations for better

procurement. The Taskforce’s responsibilities for that national strategy are set out in Towards a National

Strategy for Local Government, the joint response of ODPM and the Local Government Association

(LGA) to the review of local government procurement in 2001.

The Taskforce’s publications are issued in response to that responsibility. The publications build on the

work of others, the experience of the Taskforce’s Pathfinder authorities and draw on the guidance

developed by the Office for Government Commerce (OGC), the 4Ps and others. The guidance also

provides a basis for implementing the recommendations contained in the Audit Commission’s report

Competitive Procurement (2002) which emphasised the need for every authority’s procurement decisions

to be informed by a well thought-out corporate procurement strategy.

There is increasing pressure on local authorities to deliver better services, often within strict budgetary

constraints. This pressure comes from many sources, including rising public expectations. It is a feature of

the Government’s modernisation agenda and the need to seek continuous service delivery improvements,

which is enshrined in best value legislation. Impetus also comes from the Comprehensive Performance

Assessment (CPA), the need to achieve e-government targets and also, crucially, from authorities’ own

desire to improve.

The purpose of the Taskforce publications, including this final volume, is not to add to the pressure but to

offer practical assistance in the development of SSPs.

http://www.local-regions/

mailto:[email protected]


Choosing a partner is only the start. A partnership will only deliver if it is positively managed throughout

its life. The governance of a partnership needs to reflect the considerations referenced in the Audit

Commission’s report Corporate Governance (2003) if the partnership’s role and its delivery mechanisms

are to be reflected within the overall strategic planning of the authority. This volume of the Rethinking

Service Delivery series is designed to assist members and officers in the governance and relationship

planning for partnership working once the deal is in place, drawing on experiences of SSPs to date and

other researched work that has gone before. It also seeks to introduce a new methodology for measuring

the impact of partnership on the desired outcomes.

Partnership arrangements are a new way of working for many authorities and may also be new to the

service provider. Both parties need to be 'intelligent partners' in that they understand what each has to do

to develop and maintain a productive and mutually beneficial relationship. For the partnership to succeed

it must achieve the objectives of each partner. These will include improved services to the public and,

where a private sector company is involved, profits for its shareholders.

This guidance is supported by case study work which can be viewed on the Taskforce website:

www.local-regions.odpm.gov.uk/ssdpart/index.htm

The Taskforce handbooks and guidance for authorities include:

All the Taskforce guidance is designed to offer practical solutions to you as a local authority member or

officer on whether to use a SSP approach. The guidance covers how to procure a SSP, how to manage

that procurement process and the workforce matters inherent in the approach, and, from experiences to

date, making the partnership successful.

In addition, there are companion volumes which include:

Strategic Service Partnerships – a decision makers’ guide (ODPM 2003) – this booklet is aimed at

members and chief officers to guide them through decisions and implementation.

Volume 1

Introduction toStrategic Service

DeliveryPartnerships

Volume 2

From Visionto

OutlineBusiness Case

Volume 3

From OBCTo

Public/PublicPartnership

Volume 4

From OBCto

ContractSigning

Volume 5

Makingthe

Partnershipa Success

mailto:[email protected]


Structures for Partnerships – technical notes (ODPM 2002) – a guide to the various forms of partnership

structure that are available, the advantages and disadvantages of each model, legal and regulatory issues

of which to be aware.

Employees and Partnerships – technical notes (ODPM 2003) – a guide to the many complex employee

issues that arise and that need to be addressed to secure successful change in partnering situations.

The Partnership Assessment Tool (ODPM 2003) which provides a health check of the partnering

relationship.

Risk Management in Partnerships – technical notes (ODPM 2003) provides a framework for risk

management at both the strategic and project level in strategic service delivery partnerships. This

document also provides generic risk registers to assist project managers in developing and enhancing their

authority’s approach to risk management.

All the guidance is provided free of charge and is available on the website www.odpm.gov.uk or from:

The Office of the Deputy Prime MinisterPO Box 236WetherbyWest YorkshireLS23 7NB

Phone: 0870 1226 236

For further information about the work of the Strategic Partnering Taskforce or publications,

please e-mail: [email protected] or phone: 0207 944 5190

Acknowledgement

This volume has been produced under the guidance of a Strategic Partnering Taskforce Working Group,

whose members are listed below.

Enid Allen, Strategic Partnering Taskforce ODPM

Vicky Everett, JSS Pinnacle

Michael Ford, ITnet plc

Keith Fossey, Bedfordshire County Council

Helen Horrocks (Chair) Walsall Metropolitan Borough Council

Alan Kirkham, Wakefield MDC


In respect of this volume, the principal author is Enid Allen. Other members of the Taskforce have

contributed and their contributions are gratefully acknowledged. We also thank the authorities,

Government departments, the Audit Commission and other organisations that made helpful comments on

the earlier versions of the guidance.

If you have any comments on the guidance please submit to [email protected] or John Layton,

Strategic Partnering Taskforce, ODPM, Room 3/A6 Eland House, Bressenden Place, London SW1 5DU.

February 2004


Glossary

4Ps The Public Private Partnerships Programme – a body financed from top-sliced Revenue Support Grant funding to local government. Provides supportand advice to local authorities entering into partnerships. Also providesGateway reviews of progress in project development.

Action research The research methodology used for the Taskforce’s research anddevelopment programme. A type of research that involves the feedback offindings or actions to help in the design and implementation of furtheractions and improvements to the overall programme’s effectiveness.

Asset management plan A plan for the better use, maintenance and replacement of tangible assets byeffective business planning.

Balanced scorecard An approach to overall organisational effectiveness which uses apredetermined range of quantitative and qualitative measures to guidemanagement decision making and to assess organisational performance.

Baseline data Information from all available sources (both internal and external) of thecurrent and future needs of the services, levels of performance andsatisfaction, cost profile, assets used, investment needed and staff.

Benchmarking Comparison of the direct and indirect costs of services or elements of servicewith other authorities and other providers.

Centre for Public Scrutiny Established in January 2003 to define, articulate and promote the role ofscrutiny. The Centre will provide practical guidance and support to thedevelopment of scrutiny as a professional discipline.

Change mechanism A formal or contractually agreed device for the implementation of changesof significance to service requirements.

Client The responsible officer designated by the authority to represent the councilin the dealings with the partner.

Contract management The formal process of the monitoring and management of that which hasbeen contractually agreed. In a SSP this would include relationshipmanagement, amendments to the contracts, reviewing the benefits realisationand updating the exit strategy and contingency arrangements.

EFQM The European Foundation for Quality Management which provides a modelfor qualitative and quantitative assessment of performance, currentachievement, evaluation and continuous improvement.

Employers’ Organisation The Employers’ Organisation (EO) was established by the LocalGovernment Association in 1999 to support local authorities in their role asemployers to deliver quality services. The EO provides expert advice andinformation on people management and development in local governmentand leads the formulation of policy on some employer issues.


Exit strategy A workable and contractually agreed element of the contract or partnershipagreement. The exit strategy should bind your partner to support your exit –at the end of the term or in the event of significant failure - and give clarityregarding assets that are essential for future service delivery.

Full Business Case The full business case is a working document, used to manage theprogramme or project. If the justification for the project is no longer valid theproject should be stopped. The business case is maintained throughout theproject, being reviewed at each key decision stage. It provides the basis forthe post-project review (and beyond) to check whether key objectives andbenefits have been realised.

Gateway review The Gateway review process is a review of a procurement project carried outat key decision points by a team of experienced people, independent of theproject team internally. The process is currently being trailed by 4Ps for localgovernment procurement. The process is based on well-proven techniquesthat lead to more effective delivery of benefits together with more predicablecosts and outcomes.

Governance The framework of accountability to users, stakeholders and the widercommunity, within which organisations take decisions, and lead and controltheir functions, to achieve their objectives.

IDeA The Improvement and Development Agency established by the LocalGovernment Association to provide direct support to modernise localgovernment. It develops and delivers innovative approaches for knowledgetransfer along with practical solutions for performance improvement.

Incremental partnering Incremental partnering involves working with a strategic partner or partnersbut without the requirements of a comprehensive all-inclusive commitmentfor the long-term to cover a range of core activities. Instead, it allows thelocal authority to build up confidence with a supplier partner to work withthem to develop a stage-by-stage approach to process re-engineering theiractivities.

IPR Intellectual Property Rights - an intangible asset owned by an organisation,for example, copyright, software, know-how.

ITN An Invitation to Negotiate, issued to an agree short-list of competentsuppliers based on the pre-qualification process, which would usually includea contract, output specification, pricing mechanism, and any template formethod statement.

Joint Committee Where permitted by statute, an arrangement under S101 of LocalGovernment Act 1972. It is an unincorporated body and cannot enter intolegal contracts, hold assets or employ staff.

Joint Service Delivery When two or more public service bodies work collaboratively to deliverservices or support the delivery of service outcomes across boundaries.

Joint Venture Board A Board of Directors appointed to run the joint venture company. Where theauthority has an equity stake it may be involved in a number of ways. In itsrole as shareholder it is able to vote at general meetings, exercise rights ofapproval or rights of veto over those matters which have been reserved to theauthority. The authority may also nominate one or more directors to theBoard or only attend in the capacity as observer.


Limited LiabilityPartnership (LLP)

Formed under the Limited Liability Partnership Act 2000, a new form ofcorporate business association. LLPs are a partnership relationship whichexists with a view to profit.

LPSAs Local Public Service Agreements – a negotiated process between central andlocal government that incorporates targets for services that are relevant to theauthority’s residents and other providers. Greater freedoms and financialincentives are provided to reward achievement of those targets.

Novation The substitution of a new arrangement for an old one under a contract orformal agreement.

Office for GovernmentCommerce (OGC)

OGC is an independent office of the Treasury. OGC works with governmentto improve procurement and project/programme management. OGC alsoworks with suppliers to make the government marketplace more efficient andattractive to business

Open-book Disclosure of the costs and inputs associated with the delivery mechanismsfor services and projects.

Outcomes The impact on strategic objectives.

Output specification A statement of service requirements based on the outputs required by theauthority, rather than any measure of inputs.

Outline Business Case A combination of business analysis and investment appraisal to conclude on away forward.

Overview and scrutiny A formal function of the modernised local authority under the LocalGovernment Act 2000 with a role in ensuring proper accountability ofexecutive bodies, that services are responsive to community needs, thatperformance and delivery is scrutinised from the citizen’s perspective and toassist in securing community wellbeing.

Partnering This is an umbrella term that covers all of the associated behaviours andtechniques, arrangements and agreements that incorporate a partnering ethosand can take the form of a partnering arrangement, partnering agreement or alegal partnership.

Partnering agreement Partnering agreements, like partnering arrangements, capture the partneringbehaviours and techniques. But their distinguishing feature is that theylegally bind the partners to collaborate to refine a requirement and/or toproduce the solution of a requirement over the period of the Agreement.Generally, partnering agreements are long-term contracts. So a partneringagreement both defines the work to be done and governs the behaviours ofthe parties in a legally binding contract, which provides remedies in the eventof breach by either partner. The agreement also sets out the roles of thepartners in pursuing the objectives of the contract. It must reflect the agreedobjectives of both parties.

Partnering arrangement Describes a relationship that has adopted elements of the partnering ethos.An arrangement is not generally in a legally binding form with remedies inthe event of failure. However, it is an expression of the intentions of theparticipants, possibly across a range of contracts. A partnering arrangementmay be taken into account by a court as evidence of intended behaviour.


In some circumstances, contractual provisions may underpin partneringbehaviours and techniques. Open-book accounting can be a contractualobligation, but that in itself does not make the contract a partneringagreement.

Partnering ethos Describes the behaviours and techniques aimed at promoting effectivecommunication between local government and its partners to achieveopenness and trust, better mutual understanding, earlier identification ofproblem areas in projects, and increased value for money in complexprocurement projects.

Partnership Board A Board established within a partnership agreement or arrangementcomprising representatives of the partners with a key role to develop strategyand oversee delivery of the joint objectives.

Payment mechanism The way in which a supplier partner is paid for services, reflecting theconcept of ‘what gets paid for gets done’ and providing the means to achievecontinuous improvement and best value. Provides a clear link betweenperformance and payment.

Protocol An agreed process for an arrangement between partners: e.g. for the scrutinyprocess of the benefits of a partnership.

Prudential code or regime The new financial control mechanism for local government from 1 April2004. The new framework will provide much greater freedom to constructtransactions in accordance with normal commercial practice. The majorchange is the switch from a detailed rule-dominated system to arrangementsbased on a prudential control system. In the new system, affordability andaccounting treatment will be dominant.

Public/private SSPs Provides the public sector with access to new sources of capital investmentand also to private sector skills and expertise within a collaborativearrangement.

Public/public SSPs Public sector bodies collaborating to achieve joint service delivery to providemeaningful customer-focused services in the most efficient manner.

Relationship management Developing the most effective working relationship between partners at alllevels of each partner’s organisation to ensure that the quality of thoserelationships enhances service delivery.

Social capital An asset forged from the informal association of interested people in thecommunity to build and enhance their own communities and improve societyin the context of citizenship – a form of social entrepreneurialism.

Social Enterprises Social Enterprises are businesses that trade in the market to fulfil social aims,such as employment creation or the provision of quality local services.Working towards the objectives of economic development and social gain,Social Enterprises share two common characteristics – enterprise-orientedwith explicit social aims - and are autonomous with participation bystakeholder groups or trustees in the governance and ownership structure

SSP Strategic Service Delivery Partnership – a collaborative way of working witha strong relationship focus. Can be between public, private orvoluntary/social enterprise sector partners.


Stakeholders All those with a particular interest in the authority and the services delivered,for example, service users, staff, elected members, etc.

Third-party contracts Contracts for supply with another organisation or individual external to thepartnership.

Transition In this context, the state of moving to the new partnering arrangements.

TUPE Transfer of Undertakings (Protection of Employment) Regulations

Variations In this context, changes to the original contract terms and deliverables thatare regarded as significant and have an additional cost implication.

VFM Value for money is a test of reasonableness in financial terms that must becarried out by public bodies for all transactions. A project may representVFM but may not be affordable. Affordability and VFM are not the samefinancial tests.


1.Introduction

“Partnering involves two or more organisations working together to improve performance

through mutual objectives, devising a way of resolving disputes and committing to

continuous improvement, measuring progress and sharing gains.”

The Egan Report, Rethinking Construction 1998

Strategic Service Delivery Partnership (SSP) working is becoming more commonplace for many local

authorities. However, strategic service delivery partnerships pose new and complex governance

challenges: for example, how do elected members or new administrations get to make decisions or have

influence when a contract has been let for a long time? It is inevitable that any SSP will involve a loss of

some control over service delivery. Partnership means that control is replaced by influence and members

have a responsibility to ensure that influence is exercised effectively and knowledgeably. The best

partnerships will be seen as political priorities; led by politicians and seen to contribute to wider political

priorities. Governance needs to link formally into the political and managerial processes of the Council

and to other partners’ governance arrangements.

Much of what is needed to make partnerships successful is common sense rather than some obscure piece

of management practice. Successful SSPs are not achieved easily and require considerable effort to

develop and manage. However, the rewards that can be generated from a SSP are significant and can

underpin the authority’s community leadership role to great effect by working across organisational

boundaries and increasing corporate capacity by working with others that can add real value.

This guidance is designed to help elected members and officers of local authorities that are considering

entering into a strategic service delivery partnership – or who already are in such a partnership – to make

their partnership a success. This is the final volume of the Rethinking Service Delivery series and starts at

transition phase of the relationship and considers the important issues that will occur during the life cycle

of the partnership.

Partnerships could be structured to develop over time or a local authority might build partnerships with a

number of service suppliers or build up strategic partnering from smaller, pragmatic arrangements. These

are new approaches – incremental ways of achieving success and new ways of delivering services.


There is a wealth of information on how the partnerships can be commissioned, procured and developed

and the key learning from the Taskforce Pathfinders and other sources has been captured in the earlier

volumes of Rethinking Service Delivery. There is little researched information on the techniques needed

to sustain and develop SSPs over their whole life. Perhaps this is not surprising given that the first SSPs

formed are less than four years old. However, the Taskforce has commissioned case studies and these,

linked to other experiences from the Taskforce’s Pathfinder projects, have been used to provide some

foundations for good practice in managing SSP arrangements.

Partnerships need to be actively managed through their whole-life, taking time out to assess the health and

continuing usefulness to the authority’s community strategy and its overall objectives. The quality of the

relationship and the effective dialogue between partners will be what allows the partnership to prosper

and adapt to the changing environment.

Good governance makes for high quality public services, whilst poor governance is at the heart of many

public service failures. Good governance is at the heart of excellent public services.

People and changePeople are the most important resource that local government and public service delivery depend on to

deliver modern, customer-focused services in a timely and cost-effective way. As such, the change

agenda must be clearly articulated to all who are involved in the authority and any partner organisations

to ensure that the right behaviours and ethos are firmly established. Leadership is vital in any successful

organisation and that role becomes increasingly important in times of change. Strong leadership is

required at all levels of an organisation and those in positions of authority and who have staff for whom

they are responsible, need to feel empowered to find effective ways of delivering the change programme

on which the authority has embarked. The authority should ensure that its people-development plans

reflect the way in which the authority is now delivering its services and that skills, both personal and

professional, it wishes to build within the workforce are reflected in the plans. The partner organisation

also needs to be responsive to the ethos for change that the authority is managing and implement similar

plans that will ensure its workforce is addressing the same vision.

Political leadershipLeadership from elected members in the continuing development of the partnership involves their

continuing commitment to the relationship on which they have embarked. Their role may be defined in a

number of ways. Members may be part of any partnership board that the authority and its partners have

established to give strategic direction to the partnership. The overview and scrutiny function will also


have a valuable role for Members to play in ensuring effective partnership development that is meeting

the needs of the service users. The local ward members provide the conduit for the users as stakeholders

and are an important voice in the on-going development of the partnership and ensuring flexibility to meet

changing needs. Officers will need support for both the implementation and the management of the

partnership and members’ leadership in this capacity will be an important role. Accountability for

services remains firmly with the elected members and the early resolution of any conflicts or disputes in

the partnership must be a matter of priority to ensure the continuous improvement of local services. The

most crucial role for the political leadership to play is one of supportive enthusiasm for the partnership,

particularly during its initial period. Our research has shown that following a long period of negotiation

the launch of a new partnership brings with it high expectations of service improvement. The programmes

of re-engineering and culture change cannot happen quickly and often service quality can decline before it

begins to improve. This period of transition needs strong political leadership to support those leading the

change programmes.

The format of the guidanceThis guidance follows the life of the partnership through from transition to exit. It covers in essence the

more important aspects of working collaboratively to achieve better results. The drive to improve services

associated with best value and continuous improvement needs to underpin the way the partnership is

established and managed. The guidance covers the following topics:

� Transition and contract start-up

� Structures for partnership management

� The role of elected members

� Elected members and accountability

� Review and evaluation

� Managing change

� The client function

� Performance management and outcome measures

� Dispute resolution

� Exit strategies – planning the end


2.Transition and contract start-up

How well the transition is managed is an important step on the road to making the partnership a success.

Ensuring continuous service delivery during the start up and the transition phase is important. This will be

the first test of the partnership. Good planning during the negotiation stage will help to identify any

cultural issues that may need to be addressed, provide a seamless transfer of services and ensure service

continuity during the transition period.

The transition period is the time between the decision to award the contract and the commencement date

for the partnership. It is the planning undertaken at this stage that will help to ensure a seamless transfer

of service delivery. Good and regular communication remains an important factor just as in the earlier

stages of the project’s development.

The authority will have a document “bible” comprising all the contractual documentation. This “bible” is

a complete record of the transaction and contains the project agreement and other legal documentation.

That documentation will govern the relationship of the parties moving forward into the service delivery

phase. It puts in place a contractual relationship between the parties. A key issue is to ensure that external

advisors accurately record all agreements reached during the negotiations, so that the council has some

protection if it needs to rely on such a record. On a practical point, the partners should be clear who needs

to sign and seal the agreement or contract. Subsequent practical arrangements may also entail low-key

negotiations and again a clear and accessible record needs to be kept so that the interface between service

areas of the council and the SSP delivery vehicle is clear to all.

However, before that new relationship is cemented, it is necessary to have a period of “handover”, which

is when the practical transition between the delivery of services under an in-house arrangement and

delivery under the SSP occurs. In a public/public partnership the change is often more incremental in its

approach rather than a transfer or handover. It is more likely to take the form of an agreement to

collaborate with a gradual progression to joint service delivery.

A single date is normally agreed for handover and on that date responsibility changes. Most parties

favour this “big bang” approach so that the issue of responsibility is clear and, importantly, all the staff

affected by the partnership know their lines of responsibility and that the requirements of TUPE are met.

The exact details of the transition arrangements will be based on a transition plan which will have been

agreed as part of the negotiations. The phasing of significant changes need to be well planned. The plan


will include an implementation schedule which identifies which tasks/services are to be transferred and in

which order.

Any handover needs to implement an agreed plan which addresses a range of issues. The main elements

to be dealt with are:

� Transfer of staff;

� Transfer of assets (including ICT);

� Transfer of property;

� Transfer of “bureau” and other third-party services.

Most SSP arrangements between public and private sector partners will involve the transfer of staff from

the authority to the SSP. Again, most will also involve the transfer of certain assets which are necessary to

perform the services. The use of a SSP arrangement may also give rise to property implications, with the

SSP occupying property formerly used by the authority. The SSP also needs to ensure that it has its own

support services, for example payroll and personnel. These may be provided by the service provider, by

third parties or may (at least for a temporary period) be obtained from the local authority in the form of a

service contract.

Transfer of staff

Staff considerations must not be underestimated during this time, whether there are any TUPE transfers or

not. Again, experience has shown that the most stressful and hence risk to service quality, comes from

uncertainty. Staff and their unions need to feel part of the transition process and hence have a

commitment to making it happen smoothly. This will only happen when a comprehensive communication

plan is in operation. It is the same staff that will be providing the services under the new partnership and

they must be committed to the success of the partnership. Where seamless transfers have happened,

research has identified that regular meetings between the staff and the provider partner prior to the

commencement of the partnership were important to outline their roles and responsibilities and to develop

confidence in the future management.

Staff should be provided with the right, relevant information as early as possible in the process in order to

minimise the potential negative effect of transition. Consultation with staff and unions and regular two-

way dialogue will be of prime importance throughout the whole process and on into the partnership.

Employees and Partnership – technical notes (ODPM 2003) explains the TUPE obligations and the Best

Value obligations of local authorities in this respect. That guidance also stresses the need for

communication with staff who are facing change. The local authority and the SSP provider both have


obligations in this respect. The SSP provider has the task of developing an approach that will encourage

staff to see that the new start can be a positive move. The local authority has an equally important role in

ensuring that staff move across with sufficient information and support to enable them to be informed and

positive about the future.

The partnership contract may involve staff physically transferring to another building. If this is to be

undertaken then briefings with the staff about their new accommodation are essential. If the staff are

transferring with their existing equipment it is also essential that this is supported by a transition plan to

ensure that on their first day of the contact the equipment is up and running.

The process of communication should have started even before the SSP was procured and should have

continued throughout the procurement process. Where staff are transferring, one-to-one access is

necessary for the staff to meet their new employer. If staff are being transferred from an incumbent

supplier to a new partner, solutions to staff access will need to be covered in early discussions with the

authority and the existing partner.

In a public/public partnership, direct communication is equally important to reduce concerns and to allow

personal issues to be addressed.

Transfer of assetsIn relation to the transfer of assets necessary to deliver the services there are again a number of variables.

The service provider may provide most of the assets, either in the form of new investment (e.g. a new

resource management system), or by using the existing resources within that SSP. There will normally be

some assets that were previously used in relation to the service that was offered in-house. An example

would be PCs and furniture.

The key decision for the authority is whether or not the ownership of these assets should be transferred

outright, or retained by the authority (subject to the granting of a right to use the assets). The former

option means that the authority has greater dependence on the service provider if it ever has to unravel the

arrangements.

Attendant on assets are maintenance agreements; these may need to be novated following the consent of

the original party offering maintenance services. Such consent may not always be easy to obtain for a

wide range of reasons, e.g., the supplier may view the risk profile of the partner as lower than the public

authority, or refusal may be merely taking the opportunity to negotiate a higher price for the service.

Often difficulties arise around the transfer of IT licences or even in permitting a third party to use a


licence originally granted to the authority, but not to any potential partners. It is important that these are

addressed well ahead of handover to avoid costly delays or service interruptions. The implications for the

partnership of technology that is not transferred need to be considered.

Experience has shown that accurate asset schedules are frequently very difficult for public authorities to

prepare. Although this problem can be overcome through the goodwill of the partners, it can be a real

problem when the assets in questioned are leased.

Transfer of property

The authority’s needs for property may be changed by the partnership. The SSP may release buildings

which could be sold, or the SSP provider may wish to use the authority’s accommodation, at least on a

temporary basis. Particular care is necessary to ensure that, if the property is leased rather than owned by

the authority, that the consent of the owner (lessor) is obtained to any use by third parties. Once the

consent is obtained a “sub-lease” or licence to use may be given.

Changes in property use may also trigger planning considerations which can adversely affect the

timetable if not factored into the project plans early enough.

The transition period is thus one of focus on planning, implementing and managing the defined

transitional arrangements. There will need to be a strong focus on staff, whether there is a TUPE transfer

or not, as the change will need to have commitment from all staff and they will need to be well informed

to give that commitment. Unions and staff representatives should continue to be involved and can add

much value to the transition phase. A focus group can be useful, set up at an early stage of the process, so

that issues can be flushed out and dealt with as they arise. A review of the communications strategy will

be relevant in this period as there may be different stakeholders coming on board at different stages of the

development of the SSP.

The ‘seamless’ transition has much to commend it and the early work in support of such an approach will

have been addressed in the procurement planning stage (See Rethinking Service Delivery – From Outline

Business Case to Contract Signing (ODPM 2003) or Rethinking Service Delivery – Public/Public

Partnerships (ODPM 2004)).

Due diligenceOne of the key actions usually undertaken by the prospective private sector partner in the transition phase

is completion of the due diligence work necessary for a final firm price to be agreed. Basically the

purpose of the due diligence work is to ensure as far as practicable, that the nature and extent of

SP

contractual risk has been evaluated. This may encompass the latest service performance levels, the size of

process backlogs, the actual numbers of staff that will be transferring under TUPE and so forth.

It is the interests of all parties to the agreement to ensure this work is done thoroughly. It is in nobody’s

interest for there to be any surprises once the partnership has become operational.

Critical issues to be addressed in transition

� Clarification of roles and responsibilities for all affected personnel

� Staff arrangements (see Employees and Partnerships – technical notes (ODPM 2003))

� Assets, which may include ICT, other systems, buildings

� Risk management

� Service continuity and quality

� Elements of service to be retained by original provider

� Process changes required by restructuring

� Management of other suppliers

� Consultation and communication with service users

� Contract performance monitoring and reporting arrangements

� Agreement on the partnership board operation, management body and other formal interactions.

� Connections to or implications of other partnerships the authority is currently engaged in or may

be considering for the future e.g. ALMOs etc

� Novation of contracts

Key individuals from the project team that was in place during the bidding period should be retained

during the transition phase and, indeed, into the ongoing monitoring of the relationship. The reason this is

so important lies at the heart of partnership relationships. The relationship between the people that

negotiated the detail of the partnership can never be completely transferred to others. Neither can the

subtleties of the negotiations and inevitable trade-offs be completely captured in the formal legal

agreements. Hence the importance during the initial period of the partnership for those individuals who

understand the way the agreement was reached to be part of its implementation.

For more information, see Rethinking Service Delivery - From Outline Business Case to Contract Signing

(ODPM 2003)).

The transition period can be a risky period for the partnership. A schedule of meetings will need to be put

in place to ensure that all those directly responsible for the relationship and the contractual deliverables

ca

T – Volume Five: Rethinking Service Delivery Page 21

n develop and address:


� Transition plan - phasing of the significant changes planned

� A common understanding of the transitional issues that is agreed by all parties

� A programme of short-term fixes by the incoming provider where it is agreed that (in IT-related

projects) the existing technology, processes or tools are not really fit-for-purpose and are holding

back service levels

� Impact on third-party contracts

� Technology implications

� In-depth staff and union consultation

� An implementation schedule

� The management processes that will be followed

� The roles of key staff

� The administrative and liaison arrangements that will support and deliver the partnership

There are different approaches to transition to a new partnership – for some; transition is a continual state

(See Rethinking Service Delivery – Public/Public Partnerships (ODPM 2004)). For others, transition may

be a more one-off event that will need to be project-managed with critical path monitoring by a high-level

team. Consider extending due diligence through the transition period to test out assumptions – if extra

costs are found and affordability does not allow for this, other contractual obligations can often be relaxed

as a compromise.

This phase needs also to address the expectations of the partners. For example, if the service is poor, it is

unlikely to transform overnight and may deteriorate in the transition stage if it is not well managed. The

timetable for addressing and delivering improvements will be part of the final agreement reached. Joint

training and workshops will help to cement working relationships from an early stage and can be

instrumental in getting SSPs off to a flying start. Shared induction processes, joint interviews for key

partnership posts, attendance at each other’s management team meetings – all help to provide the practical

reality of making the partnership a success. There is further consideration of the important issues around

staff – both transferring to or engaged in the partnership and those retained within the existing authority

structure - see Employees and Partnerships – technical notes (ODPM 2003).

In a public/public partnership, there is a less-clear ‘start-up’ plan, rather a gradual transition to a close

collaborative way of working that provides opportunities for relationships to develop that will help to

avoid the demarcation lines between different professional ‘fiefdoms’. This gradual building of trust and

confidence will also help to alleviate the concerns of managers who may feel vulnerable in the new joint

working arrangements. However, even in an incremental approach the phasing of the work needs to be

confirmed and a timetable agreed for both or all parties.

Sound planning and forward strategic management can greatly assist in the process and provide further

opportunities for joint working to emerge.


Considering the wider opportunities that partnering with other public bodies presents is a key part of an

options appraisal process. Such arrangements will have a tendency to always be ‘in transition’ by their

nature and public/public partnerships will develop incrementally, taking advantage of the circumstances

that exist locally and building on those opportunities.

Matters can of course be more complex when legislation or policy drives the building of public/public

partnerships but again, in this scenario, transition will invariably be a continuous state. However, for

success, such partnerships need to be well grounded in strong project management and forward planning,

with a strong collaborative relationship.

Case StudyThe PAWS partnershipAdur District and Worthing Borough Councils

This is a public/public partnership between Adur and Worthing Councils which started as a waste

Case Study ExampleConsortiumAuditCorby, Kettering, Northampton and Wellingborough Councils ina consortium partnership for internal audit services.

The four authorities formed a consortium to deliver their internal audit function. Internal audit is an

important but relatively small function in any council and one which has increasingly had difficulty in

recruiting and retaining staff.

Staff transferred under TUPE to Northampton, the host authority, from the other three authorities and

the Consortium subsequently acquired PricewaterhouseCoopers as an additional partner to provide

specialist advice, training and development, new ways of working and other added value activities.

ConsortiumAudit now supplies Internal Audit services to others in the public sector.

Building on the strong strategic relationship between the four authorities, further opportunities are

being identified as circumstances present themselves.

For example, Wellingborough is about to start delivering NNDR administration for Northampton

Council. Again, NNDR is a small but complex activity and as a vacancy had arisen within

Northampton and there was a need for new software, it became an excellent opportunity for further

collaboration to address the need for change by the partnership.

For full details of the case study on ConsortiumAudit, see www.odpm.gov.uk


Learning points


� There needs to be a great emphasis on staff issues across the authority in the planning of the transition

phase.

� Consult widely and understand the implications of the transition period for service performance and

critical phasing of major change projects.

� Transition should be linked to transformation – the plan should provide the flexibility to recognise

that change would be the norm.

� Staff involved in the negotiation of the contractual agreement should be retained through the

transitional phase and into the full operational phase of the partnership.

� In a public/public partnership, it is just as important to clarify transition plans, even though transition

to the new state will be a more gradual process.

� Building a collaborative trusting relationship between authorities and other public bodies will lay the

foundations for joint service delivery that improves cost-effectiveness and benefits the user.

� Clarify all matters around technology, including third-party consents and novation, along with

compatibility of old and new systems.

� Verify other leases and assignment rights on relevant property that is affected by the partnership.

� Ensure the asset inventory is accurate, up-to-date and reflected in the transition plan.

� Verify that due diligence gave a true perspective – it is in the authority’s best interest to ensure that it

reflects reality.

� The transition plan should be agreed by all parties.

� Management plans and roles and responsibilities must be clearly defined.

� Transition can be risky and needs careful management, linked to relationship-building activities and a

communication strategy.

� A sound strategic partnering relationship with other local authorities will enable opportunities to be

realised as they present.

� There may need to be a cost indemnity agreement to progress initial phases of a project if partners

which to proceed in advance of contract signing.


3.Structures for partnership management

Good corporate governance is a mix of hard and soft factors: robust systems linked to effective leadership

and high ethical standards. Good governance supports effective decision making, which always involves

risk, but that risk is reduced when the culture is open and free discussion and debate takes place.

Authorities are unlikely to ensure that partnerships are effective unless their corporate governance is

effective.

How corporate governance affects the quality of partnership outcomes and how partnership affects the

authority’s own governance arrangements are important issues that are discussed in this guidance. These

links are intrinsic to overall effectiveness.

How the authority plans and manages its SSP, and its internal resources to support its policy and strategy,

is fundamental to the effective operation of the authority. Partnership management calls for interactions

across all levels of the organisations to build viable relationships but, fundamentally, partners need to

have a formal structure to address strategy, management and the operational activities for the partnership.

Within such a structure, the role and responsibilities need to be clearly defined. But partners should never

lose sight of the importance of the right behaviour – relevant behaviour – for a partnership that will build

trust and encourage the sharing of information to achieve common goals.

In any SSP there needs to be adequate access to information for the Council’s Monitoring Officer, S.151

Officer, and both internal and district audit functions to enable all to comply with their statutory duties.

The project agreement needs to include appropriate provision.

Partnership agreements and contractual arrangements can be large and complex documents. There will be

different legal structures for different partnerships to meet the circumstances that an individual authority

needs to address. This guidance does not deal with those in any detail; the Taskforce guidance and the

implications of each legal form can be found in Structures for Partnership – technical notes (ODPM

2002). However, the translation of the legal framework into a working relationship where there is

understanding and clarity of roles and responsibilities is of prime importance. Using plain language

protocols and standards to cover issues such as managing the partnership, applying the change control

procedures, the media and public relations generally, can be of great value and assist authorities in

building an effective, collaborative relationship.

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orporate change can be inhibited in existing devolved management structures, including decisi

aking processes and technology. If departments are too focused on their own issues, corporate

ill not be achieved without strong direction from the centre. A central client role needs to adop

f consulting and then reaching a decision if timely actions are to occur.

ifferent partnerships are structured in different ways and are designed and adapted to meet the

hat partnership in that environment. What works for your SSP is what matters but it will need t

hree main areas of governance – strategic planning, management and operations.

trategic he strategic overview is required from a senior level in the organisation, including elected mem

rovide the continuing review of the direction of the partnership and to ensure that the objective

artners are achieved over time, reviewing those achievements and the outcomes (good or bad)

earning from the process.

hatever the particular forum is called – partnership board, joint committee, strategic group, jo

enture board – the important function that it needs to address is strategy, which should be deve

rom the strategies of the partners’ own organisations. A clear, community-focused strategy cov

ull range of issues that the partnership supports will be a prime tool by which the SSP evolves o

uthorities may consider that one or more external stakeholders – for example, the local strateg

artnership - should take a seat on the partnership board where the partnership has district-wide

egional) implications. Strategy needs to be with reference to the community strategy for the are

uite likely in the majority of councils this will contribute to the achievement of Public Service

PT – Volume Five: Rethinking Service Delivery Page 27

greement (PSA) targets. The executive body needs to ensure that any matters arising from the

artnership that fall into the category of ‘key decisions’ are adequately reflected in the council’s Forward

lan.

he authority has obligations under the legislation on equality and needs to consider how it should work

ith commercial partners or other public bodies including their SSP to promote equality in employment.

he authority’s role would include raising awareness of how the application of equal opportunities in staff

ecruitment and management practice can bring commercial and other partnership benefits to the SSP.

he authority will need to state and certify within its annual performance plan that all contracts awarded

uring the past year which involve a staff transfer comply with the requirements in the Code of Practice

n Workforce Matters in Local Authority Service Contracts (Annexe D ODPM 3/2003). Authorities are

ow required to produce improvement plans and these need to take into account the status and objectives

f any partnership arrangement with effective improvement planning to address any areas that are under-


performing and to exploit new opportunities and deliver better quality services. Responsibility for

improvement planning lies with the authority and any partnering arrangement needs to make provision for

addressing such plans within the contractual arrangements. Further advice will be issued by the ODPM

during 2004 on the establishment of cost-effectiveness measures in the context of best value performance

indicators and local PSAs. These will reflect the importance that is attached to service delivery at the local

level, regardless of who provides the service for the authority and its citizens.

Sustainable development is fundamental to best value and as leaders in the community, authorities are

expected to work for the long-term well-being of their community. Sustainability should feature as part of

the development of partnership initiatives and be reflected in the strategic planning that underpins the

partnership.

The partnership’s strategy will need to be supported by management objectives and targets linked to

operational plans and delivery mechanisms and processes. It is too easy when operational difficulties

occur – as they will from time to time – for the strategic board to focus on those aspects and become less

effective at developing the forward perspective. Changes in local priorities must be clearly articulated and

reflected in strategic development, with partners encouraged and motivated to contribute to effective

solutions.

The executive body of the authority needs to be able to influence the partnership board for effective

integration as well as the partnership board being capable of supporting and contributing to the

developments of the authority – this is a strategic partnership. In some public/private SSPs, trust and

common interest has reached a point where the private sector partner now sits on the corporate

management team of the authority. This assists in having a sound understanding of the authority’s

business, its financial pressures and other influences that regularly test the forward planning of local

government.

Management

This will be provided by the directors or other senior management to agree major projects in accordance

with the objectives of the strategic body, to confirm the development of the business plans and to receive

and monitor progress from the operational managers. This body represents the combined management of

the partners that is responsible for implementing the strategic plans of the Board into a well-managed

reality. Clear protocols are required for the empowerment of management within the overall governance

structure. These should be well-documented, communicated and understood to avoid misunderstanding,

the development of a blame culture and blockages.


There will need to be business cases prepared for new projects that the SSP is to address and for the

authority to consider the suitability and cost of such projects in a well-informed way. Early joint

involvement in new areas of development will reap dividends but the authority must retain sufficient

capacity to test and challenge as appropriate major new developments. Retention of an adequate budget

for third-party advice where the authority may have retained modest client capacity should be considered

as an alternative way of providing intellectual and professional input to the management of the

partnership.

Commitment to good contract management, resolution of disputes, and mechanisms for realising new

opportunities should have been developed and stated clearly within the partnering agreement or contract.

This also extends to change management.

London Borough of Greenwich and Deloitte & Touche

Partnership Governance structure (see also page x for more information about thisproject)

© Deloitte & Touche 2001

Operational GroupOperational Group

ProjectBoard

ProjectBoard

ProjectBoard

ProjectBoard Project

BoardProjectBoard

e-gov Programme Strategy Group e-gov Programme Strategy Group

GMT IT Strategy Group

Cabinet GMT

SI Partner IT Client ServicesIT Client Services

Lead Member

KeyGMT The London Borough of Greenwich Management TeamSI Service Integration partner (Deloitte & Touche)


The change mechanisms in place need to be flexible and adaptable to adjust for changes in requirements

with the strategic partner contributing to the ways in which the changing business of the authority can

best be delivered.

A large-scale, multi-function partnership existing over many years is bound to require changes to its

requirements. Work volumes are likely to fluctuate up and down. And in a time of service revolution, the

content of the partnership might need to be re-shaped significantly. It is essential therefore that the

relationship and the contract or agreement define mechanisms to allow variations to be agreed efficiently

and economically. The change mechanism should not be so onerous as to avoid changes to the contract,

nor should it be so detailed that every minor variation needs to be put through the process.

Where a group of authorities have entered into a SSP, a protocol would have been agreed for ongoing

management. This may cover the method of sharing payment for services for example, in a joint customer

contact centre. Consider whether payment is to be based on use of the centre in respective proportion to

the population served or some other basis that will provide an equitable arrangement for all partners.

Where a number of public partners are involved in a partnership it may be worth considering jointly

funding the lead planning and partnership management posts. It may also be advantageous to consider

having a joint structure with devolved authority from both or all bodies.

It is important to provide effective, sustainable management arrangements in a multi-authority partnership

with a form of delegated decision-making that will make decisions on behalf of the partnership group as a

whole.

Who should represent the partners requires careful consideration as there will be different requirements in

different types of partnerships. It is equally important that substitutes for representatives at meetings need

to be fully briefed and capable of making decisions or valuable input may be lost and delays detrimental

to the overall partnership relationship may occur.

There may be further management complexities when different authority partners have signed up to a

different arrangement within one joint procurement; this will require a comprehensive understanding of

those different contractual arrangements across the partnership as a whole, along with the ability to assess

the impact of individual changing requirements on the core deliverables.


Again, in multi-authority partnerships agreeing variations of service will be an important matter. In such a

context, authorities will need to have regard to the scope of the relationships to be managed both with the

private sector partner and with the other partner authorities.

Some authorities may choose a joint committee structure arrangement for management but the prime

focus must be on how the relationship is maintained and developed. Whatever arrangements have been

Case Study ExamplePartnering Adur and Worthing – The PAWS partnershipSimultaneous Executive Meetings(For more information about this partnership see page 24)

The project management structure for the two councils introduced a new concept – simultaneous

executive meetings, which is the main decision-making body.

Members from each Council hold a meeting at the same time and at a single venue to discuss PAWS

issues and then break into separate groups for voting. The two authorities have different democratic

arrangements so this innovative decision-making structure allows decisions to be made more quickly

than via joint committee reporting but still encourages full member involvement. All members from

both councils receive the SEM papers and can attend the meetings.

Simultaneous ExecutiveMeetings

Joint COMT

Project Sponsor

Project Manager andTeam

Project Support

Adur COMTWorthing COMT

KeyCOMT: Chief Officer Management Team


entered into, the operation of the protocol or change mechanisms will need to be reviewed to see if they

work and for adjustments to be made as necessary.

New Forrest and Test Valley Councils Joint Committee Structure

All SSPs need mechanisms that recognise the need for continuous improvement within the context of the

best value review process established by the Local Government Act 1999. In public/private SSPs these

can take the form of break clauses after five and ten years of the contract. Such clauses require partners to

co-operate with the local authority to undertake a best value review to determine whether the council is

achieving value for money through the partnership, both for the services delivered from within but

reflecting the other benefits that were envisaged – gain-share or other community benefits. Any

benchmarking and review process should not only focus on the initial specification and resource plans but

cater for the evolving nature of the partnership.

Similar arrangements should be in place for public/public SSPs to ensure the partnering arrangement is

continuing to fulfil a useful function in a cost-effective manner. Both parties should agree the

methodology employed for conducting the review and about the comparisons to be used. There should be

provisions within the agreement or contract to prepare for adjustments to price and service delivery.

CouncilTVBC

Chief ExecTVBC

Director of Commercial

Services

Chief ExecNFDC

CouncilNFDC

CommercialServices Joint

Committee3 Executive TVBC Members3 Executive NFDC Members

Joint Overview &Scrutiny Committee

3 Non Exec TVBC Members3 Non Exec NFDC Members

KeyNFDC New Forrest District CouncilTVBC Test Valley Borough Council


Mechanisms should be built in to provide for continuous improvement from an agreed baseline position.

This would include regular benchmarking with public and private sector providers.

Following a best value review, if an agreement cannot be reached on the changes needed to improve the

services then most partnerships have a provision for the termination of part or all of the partnering

agreement or contract on that basis. The 4Ps have developed a more in-depth guidance document on this

issue entitled Contracting for Best Value and it can be accessed at www.4ps.co.uk.

Case Study ExampleBlackburn with Darwen in partnership with Capita

The Council, rated ‘Excellent’ by the Audit Commission, transferred 500 staff under TUPE into a

new partnering arrangement with Capita in July 2001. It is a 15-year partnership contract to provide

a range of support services including ICT, HR and payroll, revenues and benefits, architects services,

highways, property, technical services and finance administration.

The partnership contract provides for a five-yearly review of best value of the whole partnership by

an independent third party. In addition, it provides for

� A modern business centre integral to the Council’s town centre regeneration programme

� 500+ new jobs in the town centre within the first five years of the partnership with specific

targets for postcodes with high levels of unemployment, ethnic minority employees and people

with a disability. [This target has been exceeded within the first three year with 700 jobs created

as part of Capita’s BBC TV licensing and the Criminal Records Bureaus contracts.]

� Gain-share from new business

� Incentive payment structure on achievement of key targets for job creation and diversity

objectives

� Performance indicators for key services with an incentive payment structure on achievement of

35 key performance targets – including job creation and diversity targets.

� Partnership Board, chaired by the Leader of the Council, agrees contractual changes

� Capita as a member of the Local Strategic Partnership to contribute to community planning and

to skills development in the local area.

� The Council and Capita to deliver BDirect – an integrated customer service initiative based on a

contact centre and one-stop shops.


Commitment to good contract management, resolution of disputes, and mechanisms for realising new

opportunities need to be stated clearly within the contract. The Partnership Board may well be the final

arbiter of disputes.

As partnerships become more complex and for longer duration, the need for changes to the requirements

of the agreement and contract will be many. The process of change has to be managed in an equitable

way, balancing the spirit of the SSP with the requirements and obligations of the agreement/contract.

Partners may be prepared to adopt an open-book approach in such contracts and authorities will need to

develop the skill and capacity to address the often-complex approaches to new projects and changing

requirements. Any open sharing of costs should be two-way and used to engender a high level of trust

and to support common objectives for mutually beneficial outcomes.

The agreement/contract itself should set out the change control and variation procedures and the

appropriate clauses need to be followed carefully to avoid breaches. However, it may be appropriate to

have working protocols that set out how minor variations are handled.

Operations

This monitoring role is undertaken by the officer(s) with client responsibility and will usually be achieved

through a combination of informal encounters and formal meetings that address ongoing business matters.

When true collaboration is achieved, operational management will be carried out jointly. There are

opportunities for further enhancement of joint commitment to success by facilitating matching personal

reward packages, e.g. the client manager and the provider partner’s delivery manager are both

incentivised (by bonuses, for example) on the same criteria for the success of the SSP.

Within the operational arrangements, there will usually be a facility for engagement with users of the

service to ensure dialogue regarding satisfaction, further requirements and matters of concern.


(Diagram with acknowledgement to NLGN, extracted from Managing Strategic Delivery Partnerships Allen 2002)

A formal management structure needs to be in place in public/public partnerships to ensure interactions

are structured and that all partner organisations have regard to the relevance of the partnership.

The following diagram has shows the structure of the strategic service delivery partnership between

Barnsley Metropolitan Borough Council and the Primary Care Trust as commissioners for Heath and

Social Care in Barnsley. The project has a pooled budget (under s31 of the 1999 Health Act.

Bedfordshire County Council/HBS Relationship Management Structure

Strategic Partnership Management Board

Strategic Partnership Steering Group

Partnership Review Forum

The Project Teams

HBS - Chief Executive, RegionalMD, Head of Operations(Services), Head of Operations(Education & Development),Regional Finance Director

HBS – Head of Operations,Project Manager and Learningarea representative.

HBS –Head of Operations,Reg. Finance Director,Corporate GovernanceManager. Heads of Service foreach service

BCC - 5 cllrs, Chief Executive,Assistant Chief Executive(Partnership Director), StrategicDirector (Learning)

BCC - Assistant Chief Executive,Strategic Partnerships Advisor andHR and Learning representativesand professional associates.

BCC – Assistant CE plus Finance and HRlead officers, Strategic PartnershipsAdviser. Nominated Officers for eachservice.

ContactCentre

SAP - resourcemgmt system

Development ofKPIs

Accommodationrefurbishment

Managementof existingpartnerships

Review ofbusinesssupport

New projectsand initiatives


JOINT AGENCY GROUP

Strategic Direction Agree Priorities Monitor/performance manage Allocate budgets

Client Based Boards

Strategic Planning, Commissioning and PerformanceManagement of Lead Providers

BARNSLEYPRIMARY CARE TRUST

BARNSLEY METROPOLITANBOROUGH COUNCIL

BarnsleyParticipation

Process

ServiceUser/carer

IndependentSector

Organisations

Healthier and Safer CommunitiesGoal Group

BMBC Healthand Social

AffairsScrutiny

Commission

LearningDisabilities

Children andYoung People

PhysicalDisability &SensoryImpairment

Community Plan

MentalHealth

Drug,Alcohol &Tobacco

CHC

Barnsley DistrictGeneral Hospital

Acute Trust

OlderPeople

Partnership in Action, Barnsley

Lead ProviderBMBC

Lead ProviderBPCT


Learning points

� The partners need to have interactions across all levels of the organisations to build effective

relationships.

� Strategic planning, formal management and operational arrangements must be within a clearly

defined structure.

� Have plain English protocols to cover all the key issues for the management of the SSP.

� Changes in local priorities must be clearly articulated and reflected in the strategic development of the

SSP.

� The authority’s executive body needs the right representation on the strategic board to ensure

influence over the direction of the SSP.

� Consider including your partner on the corporate management team of the authority.

� Sharing understanding of your partners’ individual issues and pressures will help everyone one in the

prioritisation of the partnership’s agenda.

� Ensure flexible change mechanisms within the contract with agreed processes to authorise change.

� Best value review clauses must be formally agreed within the partnering agreement/contract with a

defined process to test VFM, continuous improvement and community focus.

� Public/public partnerships need to be reviewed at regular intervals to ensure that VFM is delivered,

that partnerships continue to be relevant, and that the partners’ joint objectives are being delivered.

� New projects within the SSP should be planned jointly and assessed for risk for both (or all) partners’

business.

� Ensure sufficient client capacity that may include budget provision for third-party support.

� The importance of retaining an ‘intelligent client function’ cannot be overstated.

� A formal mechanism for stakeholder and user input should be devised to ensure a proper consultative

process, feeding into both strategic and operational levels.

� Protocols for sharing costs and benefits are essential in any public/public partnership, based on agreed

criteria, relevant to the partnership.

� Joint decision-making structures will assist in timely and effective decisions in public/public

arrangements.

� A strong collaborative and strategic relationship between authorities, particularly district councils,

will potentially give access to funding opportunities and greater freedoms and flexibilities from

improved services.


4.The role of elected members

A strategic service delivery partnership should be part of the portfolio of one of the cabinet or executive

members. It is essential for this relationship to be established not just when the partnership begins

operating but when decisions are being made to enter into a SSP, leading, challenging and championing

the process throughout. There will be a continuing role in relation to additional major projects once the

main agreement/contract has been awarded. This role would include agreeing the outline business case for

new, significant projects and members satisfying themselves that the processes for managing the SSP are

operating effectively.

There is a parallel role for members of the overview and scrutiny committee of the council that should

include:

� Questioning effectively the progress of major projects

� Reflecting stakeholders’ views of the effectiveness of the SSP

� Ensuring that, organisationally, lessons are learnt from major projects and other partnerships that the

authority may be involved with

� Reviewing generally the performance of the SSP and other related activities.

Members now have an opportunity to use their scrutiny powers to monitor and evaluate the effectiveness

of partnership arrangements. This is an important opportunity to hold to account executive members and

client officers for the performance of the partnership and to secure input and advice from service users

and outside expert witnesses for their deliberations.

Members should set out a protocol for scrutiny engagement, so that public and private sector partners are

clear about the ‘terms of engagement’ in the scrutiny process. This may cover such issues as when and

what level of information should be available to the public (some information may be commercially

sensitive), and relationships with the media. The use of ‘commercial in confidence’ clauses in SSPs

should be kept to the minimum and ideally avoided entirely. The process of scrutiny should aim to be a

positive and constructive one even if it stems from perceived service delivery failure. Those responsible

for spending public money are accountable for ensuring that public business is conducted in accordance

with the law and proper standards and that public money is properly accounted for, and used well. To do

this, members and officers are responsible for putting in place proper arrangements for governance and

stewardship.


Where partnerships are concerned, these arrangements should involve:

� openness and honesty in all decision-making with proper records

� clarity about the full cost of the partnership process, including all client-side costs

� access rights to all the records of the partnership

� disclosure in the published financial statements.

Councils have developed different arrangements and structures for their scrutiny and overview function

that reflect their culture and ways of working. That is as it should be, as the effectiveness of scrutiny lies

in the positive way in which the process is approached and the transparency that provides confirmation of

the effective discharge of the council’s functions. Scrutiny provides a form of review process that can

complement and add rigour to the decision-making process and has particular value in the appraisal of the

SSP. There should be terms of reference within a clear framework and a timetable, with clarity on the

expectations from the scrutiny process and the outcomes that are sought. Engagement with the public is at

the core of the scrutiny function, with community representation actively engaged in the process

providing evidence of progress towards the outcomes being achieved by the partnership. Effective

scrutiny will provide focus on the achievement of those outcomes and the delivery of continuous

improvement.

The Centre for Public Scrutiny was set up in 2003 to promote the value of scrutiny in modern and

effective government and is developing approaches for enhancing the scrutiny role to improve the quality

of public services. The Centre is in the process of compiling a good scrutiny guide in addition to its other

activities. (www.cfps.org.uk)

Where a number of authorities have formed a SSP and procured a private sector partner, as a matter of

principle and of law (Local Government Act 2000) each authority should have its own scrutiny

arrangements. However, when carrying out scrutiny in the SSP, joint-working arrangements should be co-

ordinated for effective conduct of scrutiny. Some local authority public/public partnerships have adapted

joint scrutiny arrangements (see case study below) and this is seen as beneficial. However, even where

joint scrutiny is performed, members will be aware that their primary responsibility is to the body that

they are members of, not the partnership as such. In any joint arrangements, there is a need to recognise

that for individual councils, political balance rules apply in the setting up of Overview and Scrutiny

Committees.

http://www.lg-employers.gov.uk/skills/procurement/index.html

http://www.lg-employers.gov.uk/skills/procurement/index.html


Case study exampleTest Valley Borough Council and New Forest District Council

This partnership is a joint venture between the two councils with the aim of integrating their DSOs into a

single commercial services unit. The project is being developed on an incremental basis, addressing

governance and management in the initial stages.

The joint committee is set up under S101 of Local Government Act 1972. The joint committee is

empowered to take decisions within the policy and budget framework approved by both councils, and can

make urgent decisions within an approved limited budget.

Three executive members from each authority sit on the joint committee. The joint committee is

empowered to delegate to officers of each authority.

A joint scrutiny committee comprising members of both authorities has been set up.

Three non-executive members from each council are appointed for scrutiny reflecting the political

proportionality rules. Call-in arrangements follow Test Valley Borough Council’s procedures as they are

responsible for the day-to-day administration of the joint committee.

The Monitoring Officers and the S.151 Officers from both partners make sure that each council complies

with their statutory responsibilities.

Internal audit has independent access to the joint committee.

The two management teams have been merged to reduce duplication and the Partnership Director reports

directly to the joint committee and is accountable to both Chief Executives.

For the full case study, see www.odpm.gov.uk

Local ward members can be important figures in helping to work with local residents to ‘make the

partnership work’ on the ground. All members will monitor what is happening through their

representative role and should seek to bring about improvements where needed.

In the development of any SSP the specific member individual development needs should be taken on

board as well, whether the member is the project champion, Chair of scrutiny, backbencher etc. This

needs to be built into the development of the project and to ensure changes at elections are reflected in the


member development plan so that is it an ongoing process as part of a wider organisational development

programme.

When there are multi-authority projects councils should seek to harmonise their key decision criteria, at

least for the purposes of the SSP. Additionally, decisions that require any formal executive action need to

take into account the governance structures of each partner, particularly in terms of timeframes for

decisions.

Most elected members are likely to be involved in best value reviews and other important aspects of

planning service delivery at some stage. It is important that they understand the role of the SSP in

achieving best value for the authority generally and that importance is attached corporately to high quality

procurement, project management, risk management and performance management. IDeA, the Employers

Organisation and 4Ps have devised a skills framework for strategic procurement and contract

management in local government. This reflects the skills required for staff at the operational end of

procuring a SSP. Members and officers should ensure that the right skills are in place that will provide

effective contract and relationship management. The skills framework can be found at www.lg-

employers.gov.uk/skills/procurement/index.html . The central agencies and professional bodies are

working to develop the range of training and development programmes to meet the needs identified by the

skills framework.

Learning points� The SSP should be part of the portfolio of a cabinet or executive member.

� Agreeing business cases for new projects will be part of the role.

� Members need to be engaged in the project from the early stages of development – leading,

challenging and championing the process.

� The SSP must be part of a Cabinet member’s portfolio form the first decision to investigate the

possibility of establishing a SSP.

� Members with scrutiny responsibilities should use their powers to monitor and evaluate the

effectiveness of the SSP and the client management function.

� Have a protocol for scrutiny arrangements that clearly defines the terms of engagement.

� Consider joint scrutiny working arrangements if other authorities are part of your SSP.

� Take into account member development needs specific to strategic service delivery partnership

working.

� The plans for a SSP must fall clearly within the remit of a single Overview and Scrutiny Committee.


5.Elected members and accountability

The public accountability principles and mechanisms should be developed when the partnership is being

formed, be it a public/public partnership or with a private or voluntary sector partnering arrangement.

It has been suggested in the Commission for Public Private Partnerships Report (IPPR June 2001) that:

� Performance data on services provided through partnerships should always be made publicly

available.

� The responsibility of different bodies to a partnership should always be explicit in the contract. Public

bodies are responsible for ensuring that citizens will not suffer as a result of contractual deficiencies.

� The status and competence of decision-making bodies such as partnership boards should always be

made explicit

Partnership arrangements can deliver greater accountability potentially than in-house service provision.

Agreements within a partnership should always contain measures for redress and rectification in the event

of failures to deliver, as befits a split between purchaser and provider. Realistically, internally delivered

services can lack such accountability, and redress is more limited or tenuous to say the least.

Improvements in quality can emanate from the better specification of services, from defining strategic

outcomes as a result of entering into partnership relationships, and from the improvements in monitoring

that go hand-in-glove with such partnering activities.

Accountability is essential in a SSP and both the provider partner and the client partner have to be

accountable to each other and to the wider community. Member scrutiny has a major role to play in this

and should hold the council executive to account for client partnership management and for public service

performance - for this cannot be delegated to the provider. Overview and Scrutiny Committees also have

a policy development role and it is important that this is fed into the direction taken by the partnership.

This is even more relevant in an incremental partnership. The provider partner should expect to be the

subject of member scrutiny in respect of the partnership. The client function may also benefit from the

scrutiny function, as the way in which the client manages the contract or partnership agreement and

contributes to the development of the relationship.

Members will wish to see the development of a common methodology to provide management

information across all services where the SSP will impact. They will wish to identify how the partnership

arrangement will assist in defining responsibility and accountability for performance. They will want to


be able to identify and audit VFM savings. They will wish to be reassured that if “something goes

wrong”, there is a clear chain of responsibility.

Elected members should be given access to any private sector partner in certain situations e.g. where the

vision for the service is being rethought or where they have complaints about service levels and should

not always have to go through the client function. This would remove a source of frustration and

bureaucracy from the way some partnerships are managed by clients. Elected members often value the

access they have directly with officers to resolve issues speedily with the most knowledgeable person.

When a partnering arrangement exists or a contract is let and the services are transferred into a

partnership, this relationship will change. Discussions around these concerns need to take place in the

negotiations to form the partnership and ensure that any related costs of different forms of access are

included in the final pricing. Private sector partners and other partners should have clear protocols which

are not seen to restrict member access.

The role of elected member scrutiny in the overall performance management function remains a key link

to the democratic process. Elected members are often service users as well and there is a need to be

sensitive to the Code of Conduct, particularly where the SSP embraces a whole range of services. A

commercial protocol may be a useful device which will be relevant both during contract negotiation and

as the SSP develops. With cabinet structures, delegation of decision-making to individual members and

elected Mayors, there may be fewer checks and balances on how decisions are made and the

reasonableness principle may give grounds for call in or other challenge if care is not taken. Changes may

be necessary to the council’s constitution, particularly financial procedural rules and contract procedure

rules to ensure that, procedurally, the SSP can function, but such changes should be kept to a minimum

and be clearly explained and justified.

The local authority and its elected members will remain accountable for services, regardless of the

provisions that are made for their delivery. Making the decision to enter into a SSP and the evaluation of

alternative service delivery models is an exercise of the accountability for the elected members.

Responsibility for delivery will remain with the authority and therefore a contract and a partnership

agreement can provide an effective way of discharging that responsibility.

Local authorities can delegate functions to other local authorities and in some instances accountability can

be transferred to another public body. Such delegation has occurred in respect of leisure activities and

aspects of ‘street scene’ activities.


Case study ExampleLondon Borough of Richmond upon Thames in partnership withITNET

The elected members and officers in Richmond upon Thames have demonstrated enthusiasm to improve

effectiveness and efficiency and to meet the Modernising Government target for electronic service

delivery by entering into a new partnership. In a deal signed in February 2003, ITNET are to work with

the Council to deliver the challenging target of E-government one year early – as part of the Council’s

Public Services Agreement with central Government.

The Council views this as an exercise of its accountability for making the best use of available resources

and recognising the need to have an experienced IT partner to meet the business goals.

The Council also needed a creative commercial arrangement like this in which the Council has transferred

its assets to the partner. The arrangement allows the authority to pay for its services out of revenue

budget, rather than capital, thereby reducing the need to borrow and enabling the borough to target capital

funds on other pressing community needs.

For the full case study, see www, odpm.gov.uk

SSP arrangements should be part of a regular review process and reported to members to assist in

fulfilling their duty of accountability and to inform other decisions that the authority may take in pursuit

of their procurement strategy. Performance statements covering service delivery, stakeholder views,

finance and comparisons with plans should be available at least quarterly.


Learning points� Performance data on the partnership should always be publicly available

� The status of the decision-making body, such as a partnership board, should be made explicit

� Formal agreements/contracts in a SSP deliver a high level of accountability

� Member scrutiny should confirm the accountability arrangements for the SSP

� Private sector partners need to develop robust, cooperative arrangements with Overview and Scrutiny

Committees.

� Elected members need to have direct access to provider partners in defined circumstances

� Making the decision to enter into a SSP is an exercise of accountability by the elected members

� Members should formally review the benefits from the SSP periodically.

� Overview and scrutiny has a policy development role and this needs to feed into the strategic

partnership body.

� Changes to the constitution and other rules should be subject to open scrutiny to ensure that support

for the SSP is not weakened through misunderstanding.

� Provider partners should expect to be subject to scrutiny, as should the client function.

� Elected members will wish to be able to identify value for money savings.

� A clear line of responsibility needs to be identifiable for members in the event that something goes

wrong.

� Changes may be necessary to the council’s constitution and its financial and contract rules to ensure

that the SSP can function as planned.


6.Review and evaluation

Regular review and evaluation are essential to the continued success of SSPs. There should be a formal

review, involving a third party (for objectivity), every year and a more thorough review timed to link

every five years with the authority’s best value responsibilities. The use of a third party in the review

process allows additional skills and knowledge, that may be either scarce or absent in the authority, to be

brought into the process in addition to providing external rigour and distance that allows greater

objectivity. In some instances, it may be better for the review to be provided by an outside organisation

but it can be better if the local authority leads it. If an approach using a third party is employed, the

authority’s partners need to be committed to such a review, as confidentiality concerns will arise. The

partnering agreement/contract does need to set the framework at the outset for reviews and the

involvement and use of third parties.

Many SSPs involve significant investment. Reviewing and reconsidering how investment is structured in

a partnership following the introduction of the prudential regime for local government finance can

potentially provide a new mechanism for successful development of partnering activities and new projects

within a partnership. The ability of the council to provide investment more readily into a joint endeavour

may well assist in improving the deal structure along with the negotiating ability of the council for

changes that will arise in any long-term partnership.

The review should also ask if the SSP is providing business value to the private sector partner. The

equivalent of VFM for the client is probably VFI (Value From Investment) or ROI (Return on

Investment) for the provider. If it hasn’t been achieved the provider will look to cut its costs and operate

perhaps too ‘close to the wire’. VFI clearly comes from revenue but it also comes from further business

opportunities opened up – growth in the account, case studies, experience, references, and shared

platforms with the client to promote further sales. Private sector VFI needs sustainability on which to

build consistency of approach; public sector VFM must reflect expectations at the start of the process and

be reassessed on the changing business case over time.

The outcome from the formal review process should establish a clear understanding of how the

partnership plans to move forward and provide information to select the best course of action. The review

process could be a valid work plan for Overview and Scrutiny, supported or facilitated by an objective

third party or peer group.

http://www.4ps.gov.uk/


In a public/public partnership, in addition to the VFM issues, the review should look at some of the

following:

� Ensuring that there is continuing buy-in across the organisations – this can be particularly challenging

in constantly changing political environments.

� Keeping the focus on service delivery and the big picture issues.

� Addressing cultural issues to maintain cultural ‘best fit’.

� Clarity of outcomes delivered and to be delivered.

� Understanding each authority’s budgetary position and financial expectations.

Evaluation of progress and problems should be done in an objective and structured manner against pre-

defined criteria. It should:

� Confirm what happened

� Understand why it happened

� Identify and be able to disseminate good practice

� Inform future planning

� Assess whether external developments (e.g. a change in the law) need a response.

It should also establish whether:

� Objectives have been achieved

� Performance standards and costs agreed or specified in the contract were met

� The service outputs/specification still meet current needs

A SSP review

� Are the business cases for projects and the SSP overall realistic?

� Does the SSP continue to provide VFM and best value?

� Does the SSP continue to add value to the private sector partner’s business?

� Does the public/public SSP continue to add value and represent VFM for all the partners?

� Do the SSP and all the services provided meet the changing business need?

� What is the impact of the business changes on:

� Relationship management

� The client function

� Services

� Performance

� Are resources and continuity of management appropriate for purpose?


Areas to consider:

� Did the agreement/contract meet its original objectives?

� Does the relationship between the parties feel like a partnership?

� Has it provided value for money?

� How does it compare with other similar agreements/contracts?

� Was the specification changed and if so, in what way?

� Were the costs higher or lower than anticipated? If so, why?

� Were all performance targets met consistently?

� If the partner was providing technical expertise, has it been proved to be correct?

� Have any independent technical audits been undertaken?

� Was the partner proactive? How did they react to problems? Did they solve them?

� Was performance and information provided on time? Was it accurate and of the quality required?

� Evidence from users or other feedback?

� How much resource (staff, time, other) was used in managing and monitoring the agreement/contract?

Was it more than expected?

� Were any contract variations introduced? What were they and why were changes to the service

needed?

� Was the partner’s performance consistent throughout the contract life?

� To what extent did the partner’s personnel change? Did it influence the contract?

� With whom did you deal on a regular basis?

The Office for Government Commerce has some useful information on the review of the benefits

delivered from a contract and preparation for the future within the process for Gateway Five of the

Gateway Review mechanism (www.ogc.org.uk).The 4Ps are currently (2003/4) piloting the Gateway

Review process in local government service delivery partnerships.

The Gateway process is based on well-proven techniques for more effective delivery of benefits, together

with control of costs and successful achievement of outcomes. For more information on the Gateway for

local government, visit www.4ps.gov.uk.


Learning points� SSPs should be formally reviewed, preferably involving a third party, every year (preferably linked to

key milestones) with more thorough reviews at least every three years

� The process and framework for review should be included in the contract or agreement.

� Formal reviews will confirm whether VFM is being achieved and that the partnership continues to

meet the authority’s needs.

� Collecting the baseline information and agreeing practical and measurable performance indicators is

key to a successful review. Get ‘stakes in the ground’ as early as possible.

� Reviews should consider the client function, relationships, services performance and trends.

� Review and evaluation is just as important for the private sector partner.

� The authority needs to be concerned that the private sector partner is receiving appropriate business

benefits from involvement in the partnership.

� Reviews should ensure that changing business needs are reflected into the partnership’s objectives.

� The Gateway process uses well-proven techniques for effective delivery of benefits. Use it if you can!


7.Relationship management

There are many ingredients that comprise good relationship management and these may vary to some

extent in different types of SSPs and in SSPs between different kinds of organisations. However, there are

some features that have common threads through all types of SSP.

Succession planning

Succession planning is important for a SSP as well as within a local authority generally. Thorough

preparation means that the departure of key personnel becomes, in effect, a planned event rather than

disruption which is potentially damaging and can create a downturn in organisational performance. This

approach applies equally to all partners in a SSP.

Succession planning is necessary, visionaries and leaders move on and retaining a sound understanding of

the SSP is essential, with other personnel developed to deliver further partnering benefits and to continue

to deliver the vision. Visionary thinkers and leaders often set up SSPs but SSPs need to be sustainable

beyond those pioneers and visionaries. Succession planning is equally relevant for the private and

voluntary sectors. When people move on, the partnering relationship can suffer if adequate preparation

has not taken place. If managed well, key personnel changes can combine the need for continuity of

approach with fresh dynamism being brought into the relationship.

The key is joint planning. Authorities carry out succession planning in their own organisations, both from

the corporate and the service perspective, so why not joint succession planning? This way there will be no

surprises, no shocks, and very importantly, no undermining of trust. Systems need to be in place for

grooming other employees for promotion and contingency plans drawn up for the unexpected departures

of key personnel. Then it becomes an expected event: planned for, well executed, with a smooth

handover. Successful people are always looking for new challenges – that is what makes them successful.

So be prepared for some departures once your SSP is in place.


Succession planning

� Discuss from the beginning, both within the partnership and in the authority, the impact of

people change, along with the level of current commitment to the SSP by leading individuals.

� Talk about imminent people-change that may affect the SSP.

� Partnering workshops could have an important role in your approach to succession planning,

ensuring wider understanding across the whole of the partner organisations and the role the

partnership fulfils.

� Build relationships at all levels in the partnership and forge networks, learning mechanisms,

and contacts generally. This will help to minimise any negative impact from the change

resisters and gatekeepers. (See Rethinking Service Delivery: from Vision to OBC (ODPM

2003) for change management guidance.)

Trust

Trust between the partners at all levels is fundamental to the relationship that a SSP seeks to build. Trust

develops from the early days of engaging with a potential partner. How the potential partners behave and

how open they are in their approach will set the tone for the future. The way in which the authority

addresses effective contract management but allows for flexibility in relationship management is a key

factor in successful partnerships. This requires a maturity of judgement on the part of the client and those

charged with prime responsibility for the relationship that enables the ‘tight/loose’ approach that can

ensure the partners delivers the joint objectives. This means being close enough to recognise what is

important and potentially vulnerable and mature enough to step back from those aspects where partners

are confident that professionalism will bring the results required – along with the knowledge to change

tack when there are indicators that show regression rather than progress.

Lack of trust is a major obstacle to success and can turn a partnership into an old-style adversarial

customer-contractor situation more quickly than it is possible to envisage. But trust can be built and re-

built by partners being honest and mature enough to admit the existence of difficulties and disputes and

by partners who get on with jointly finding the solution to difficulties. Appointing and maintaining the

right people in roles that interface between the partners is probably the most important action taken by the

partners. Those individuals will dictate whether the partnership succeeds or fails.


Case study ExampleSheffield City Council – the partnering authority

Sheffield has a population of 531,000 and is England’s fourth largest city. Over the course of the last

20 years there has been a need for economic structural changes throughout South Yorkshire, as the

traditional industries such as steel and mining reduced in significance as local employers.

In recent years, Sheffield City Council has forged the way on new types of partnerships to increase

its capacity and to improve its standards and performance. It is now assessed as a ‘good’ authority in

CPA terms, something that would have seemed way beyond reach (had such assessments then been

part of local government life) only seven or eight years ago.

There are four strategic service delivery partnerships (discounting PFI and LIFT) that make

Sheffield a model for change. These are with:

� Liberata for ICT, exchequer, and revenues and benefits� DLA solicitors in a legal services partnership� Onyx – for collection and disposal of municipal waste and an Energy from Waste

initiative� The Kier Group in a limited liability partnership for housing responsive repairs and all

municipal building repairs

As organisational learning took place following the first significant partnership with Liberata

(formerly CSL), which had to deliver huge service improvements and inevitably experienced some

difficulties in the early days but grew into a strong and productive relationship. The Council

developed confidence in its own ability to take a mature approach to working in new, collaborative

ways that led members and chief officers to explore other opportunities for improvement. Strong

leadership is seen as one of the key ingredients at Sheffield that enables officers to conduct business

with their partners in a pragmatic and business-like manner.

Sheffield is also now viewed by potential partners as a trusted and competent authority with the

capability to work in a collaborative and co-operative fashion.

For more details see the SPT case studies on www.odpm.gov.uk


Some other obstacles to building and retaining trust:

� Internal barriers and politics, territorial protection, people’s past issues – either with the partner

organisation or company, or with other partnering relationships that have not gone as well as desired.

� Fear of being open and therefore of advantage being taken.

� Lack of mutual understanding and expectation management by various partnership members can

result in misunderstandings and subsequent mistrust if ‘promises’ appear to be broken.

� Inflexible positions by traditional custodians of the corporate rules – the gatekeepers.

� Lack of the right formal structures and mechanisms to handle the partnership – this is often about

culture and how different cultures may make partnering more difficult or problematical. (But too

many structures and too many meetings are all extra cost and potential delay for all partners.)

� Failing to recognise that it is not organisations that relate in a partnership, it is people that relate to

people.

Culture

Understanding the organisations with which the authority partners will be of importance to success. Local

authority client managers should be recruited and trained to have a general understanding of partnering

and contracting in the environment they are responsible for managing. The private sector should also be

required to provide managers who are similarly experienced and trained to understand the local authority

environment.

Differences in working practices should be fully addressed and this may extend to including stakeholders

in the discussions that will need to take place. This should be done as early as possible and will allow

input into solutions from those affected by the partnership and encourage buy-in. Managing the change in

culture requires effective leadership to ensure that ownership of new working practices is achieved.

Consider testing the culture of your authority before entering into a partnership as discussed in Rethinking

Service Delivery – from Vision to OBC (ODPM 2003). Reflect on the measures needed to redress this,

which may include senior management intervention, clarification of responsibilities, joint training etc.

Teamwork allows for a high level of trust to be developed, enabling open and honest communication on

any issues, no matter how sensitive. Finally, always remember that it is the people that interface day to

day in the partnership, at all levels in the organisations, who will allow the SPT to succeed or help it to

fail.

Incremental partnering

One of the greatest risks to the any of the partners in a SSP is finding out 6 months or a year into the

relationship that actually you don’t get on as well as you had hoped and hence the strategic nature of the

relationship is unlikely to flourish. Unfortunately, the complex nature of the legal agreements underlying

most partnerships means it is not possible to have a trial period to see if the SPT works. However it is, we

believe, possible to limit the partner’s risk by creating an incremental partnership, which may meet the

needs of some authorities in some circumstances.

Many of the SSPs in recent years have been extremely large, complex relationships. A number of these

partnerships have been with private companies covering a substantial range of services representing a

large proportion of the authorities operational functions. Although most of these SSPs have successfully

delivered benefits to the partners, the all-embracing nature of this ‘big bang’ approach has felt too risky

for others.

Incremental partnering allows a local authority or a consortium of authorities to build up confidence with

their partners through a stage by stage approach to the re-engineering of their activities. The SPT

guidance Incremental Partnering-Technical Note 9 provides further advice on incremental partnerships.

The Taskforce has found that public/public partnerships are inherently incremental in their evolution but

public/private partnerships are only recently being formed on that basis.

The concept of working jointly in a harmonious relationship is common to both the large ‘big bang’

strategic partnerships and incremental partnerships. The prerequisite for such an approach will be a

comprehensive plan to modernise or process re-engineer a significant number of services. The authority

will not need to have developed a detailed list of requirements for those services but will have established

a prima facie case for change.

Essentially, incremental partnerships grow on the basis of robust business cases for expansion to other

areas of the authority, requiring the authority to be an active partner in developing strategy and evaluating

propositions on a more frequent basis than may be involved in the ‘big bang’ approach. In public/private

incremental partnering, mini-ITNs may follow the business case preparation to select the partner to

progress the development where it looks worthwhile. It is only then that the true cost-effectiveness,

affordability and VFM can be tested. Where only one partner is on board, clients will need to be satisfied

as to VFM, say, by benchmarking or an open-book approach.

There are different management challenges for incremental partnerships but many authorities might find


this a satisfactory way of developing a strategic relationship.


Case study exampleLondon Borough of Greenwich with Deloitte & Touche

The London Borough of Greenwich has an incremental partnership with Deloittes as a service

integrator for the all ICT services and business process re-engineering. The Council’s requirement was

for a partner who could drive the Council’s e-government initiatives forward and ensure radically

improved, e-enabled services into the future. The role of Deloitte’s is as systems integrator and

consultant providing strategic consultancy in addition to managing service provider contractors.

Deloitte’s have formed an alliance with SX3 for systems. However, their role with the Council

requires them to be clear that their obligations are to the Council and the payment mechanism is

structured to provide incentives to deliver on their consultancy promises. There is a four-year

framework contract which has an initial value of £4m and there is opportunity for other initiatives that

come forward with business cases but this work is not contractually guaranteed.

A proportion of the fees (and associated service credits) has been specifically allocated to the

provision of consultancy. Secondly, liability is not artificially split. Failure by the consultants to

provide any aspect of their contracted service can have a direct impact on the overall fees they receive.

The authority can still contract with other people for non-core IT and is not locked into long-term

fixed specification contracts.

The role of integrator is illustrated in this model:

Project Director e Government (LBG)Project Director e Government (LBG)

SI Partnership Programme Manager (D&T)SI Partnership Programme Manager (D&T)

IT Services Contract Manager (SX3)IT Services Contract Manager (SX3)

e-governmentSolution Project

Manager


Manager


Manager


Manager

e-governmentSolutionProject

Manager

e-governmentSolutionProject

Manager

Service Integrator Lead Partner (D&T)Service Integrator Lead Partner (D&T)

IT Services Contract Director (SX3)IT Services Contract Director (SX3)


South Gloucestershire Council with Unisys

SGC activity

Combined activity

Unisys activity

(Step 1)Prepare

specification and timetable

Idea for Phase 2 project

(Step 3)Identify funding

for OBC and FBC

(Step 4)Commission

OBC

(Step 6)Decide to

proceed with FBC

(Step 7)Commission

FBC

(Step 9)Decide to

proceed with project

(Step 10)Agree funding

(Step 2)Quote for

OBC

(Step 5)Prepare

OBC (share costs)

(Step 8)Prepare FBC(Unisys bears

costs)

(Step 11)Agree contract

schedules

(Step 12)Implement

Phase 2 Project

CLOSE

CO-OPERATION

CLOSE

CO-OPERATION

CLOSE

CO-OPERATION

SGC activity

Combined activity

Unisys activity

(Step 1)Prepare

specification and timetable

Idea for Phase 2 project

(Step 3)Identify funding

for OBC and FBC

(Step 4)Commission

OBC

(Step 6)Decide to

proceed with FBC

(Step 7)Commission

FBC

(Step 9)Decide to

proceed with project

(Step 10)Agree funding

(Step 2)Quote for

OBC

(Step 5)Prepare

OBC (share costs)

(Step 8)Prepare FBC(Unisys bears

costs)

(Step 11)Agree contract

schedules

(Step 12)Implement

Phase 2 Project

CLOSE

CO-OPERATION

CLOSE

CO-OPERATION

CLOSE

CO-OPERATION

A framework agreement has been put in place whereby individual projects are specified and developed

according to an agreed process. Improvement to the revenues and benefits services has taken place and

other projects are subject to a business case being agreed. This model was selected as it satisfies the

Council’s aim to retain its staff in-house wherever that represents best value, whilst also enabling

modernisation and streamlining of service-delivery through investment in business process re-engineering

and new ICT systems, with implementation risk shared with a strategic partner.

Key features of the model:

� Predominantly in-house service delivery enhanced through skills transfer between partners

� Projects require Outline Business Case (OBC) and Full Business Case (FBC) before implementation.

� Business process re-design is conducted by Unisys in full co-operation with the Authority

� Payment mechanism provides substantial risk transfer

� Unisys provide initial capital investment such that the assets procured are ‘off balance sheet’ for the

purposes of accounting.

� Revenues and Benefits project is substantially funded by through-life cost-savings.

� Individual projects are separate schedules to the contract with individually negotiated funding,

payment and performance terms.


Managing change

The rationale for entering into a partnership is about change: change in performance or the speed of

performance improvement, change in the quality of service to customers, change in the local economy

and job creation and change in the performance management techniques used by the authority.

But change is essentially about people, how they perform and how they are motivated and led to achieve

the council’s vision and strategies. It is essential for the authority to ensure that its employees have a

personal development plan that seeks to enhance each person’s capabilities that will enable them to

deliver the council’s objectives. Staff who have transferred, or who are transferring, to a new employer as

a result of the council entering into a partnership also need to be a focus of attention. Joint training and

development plans demonstrate the commitment of the partners to achieving the objectives to which the

partners are committed. By ensuring the standards and quality of services required within the output

specification, the council will be demonstrating its commitment to the appropriate management practices

that will ensure that the changes are compatible with the way in which the council wishes staff to be

treated.

Authorities need to have people-management practices that will identify the route map from where the

authority is now to where it needs to be. The role of people management in performance improvement –

in or out of a partnership – cannot be over-emphasised. The leadership needs to set a clear context for all

policies relating to people in the organisation, making it clear that managing and motivating people is a

responsibility for all managers.

Some authorities are now involved in a number of partnerships and it is important to consider the impact

and inter-relationships between the different partnerships for effective corporate learning and integration

and to avoid fragmentation into new silos that could replace the former departmental silos.

Successful SSPs will not only commit to joint outcomes but will add value through willingness to share

learning and contribute to professional and organisational development in the partner organisation. By

such mechanisms transfer of knowledge and understanding of the partner’s business can be delivered and

then the establishment of trust is more readily achieved, as in any close relationship. A willingness to

learn from others is not a sign of vulnerability or lack of professional skills; it is part of how personal

development and organisational enhancement takes place. Mentoring, shadowing and resource pooling

are all additional aspects of how cross-organisational development can occur and change management is

implemented.

Authorities should not underestimate the task of cultural and organisational change and the challenge it

represents. As a prime example, the Green Paper Every Child Matters (DfES 2003) sets out for

consultation a framework for improving outcomes for all children and their families, to protect them, to

S

promote their wellbeing and to support all children to develop their full potential. The paper states

“

h

w

r

c

Radical reform is needed to break down organisational boundaries”. Local bodies such as the police and

ealth organisations will, subject to consultation, have a new duty to safeguard children, promote their

ell-being and work together through these partnership arrangements. Local authorities will be

esponsible for breaking down these organisational boundaries and it will call upon all their skills as

ommunity leaders to address this challenge.

Case StudyWest Berkshire Council and Amey - partnering as an agent forchange

West Berkshire Council has a 10-year partnership with Amey for support services including

HR, Finance, ICT and procurement. The objectives for the partnership are improved service

delivery, investment in change, the introduction of new skills and cost savings for the

Council – a relatively small unitary (population 145,000). To achieve this Amey has

brought extra capacity, new systems and financial investment, underpinned with investment

in all staff to deliver the cultural change vital to modernisation.

Elected members sit alongside Council Officers and Amey managers on the Partnership

Board. Amey managers are an integral part of the Chief Executive’s senior team and advise

Councillors directly. The Council and Amey have adopted a Partnership Plan that maps out

the development of the Partnership going forward and the aspirations of both parties.

Despite some difficulties faced by Amey prior to the purchase by Ferrovial in June 2003,

there has been little staff turnover and the Council’s Chief Executive is extremely satisfied

with the progress made to date (November 2003).

A five-year Service Improvement Programme, managed and led by Amey, is the

Partnership’s catalyst for change and is clearly articulated so the public know what to

expect. As part of the programme a new Customer Contact Centre (entirely funded by

Amey) was delivered within the first twelve months of the partnership. Amey has

introduced their KPI ‘dashboard’’ system and are helping West Berkshire to reconfigure

their services through business process re-engineering. Amey provide specialist resource

for projects such as process re-engineering and change management.


For the full case study, please see www.odpm.gov.uk


All partners in a SSP are likely to start out with different cultures and the differences may show up in

working practices, terms and conditions, approaches to management and management practices.

Partners should not underestimate the difficulties that differences in culture can bring to a partnership and

unless identified and resolved in the early days, the partnership may stagnate and under-deliver – or

indeed fail – if the differences are not addressed. There is some further guidance on assessing the culture

of organisations in Rethinking Service Delivery – from Vision to OBC (ODPM 2003) which can be useful

in making the partnership a success. The Partnership Assessment Tool (ODPM 2003) may also be a

useful device for surfacing covert concerns that partners may have and provide a useful review

mechanism on the current health of a partnership. Employees in Partnerships: technical notes (ODPM

2003) contains further guidance on how to manage change successfully.

Technology may also present a challenge to the change process. There may be incompatibility between

new ICT systems for the SSP and ‘the way we do things around here’ that will inhibit the drive for

change and the chance for the authority to reap the full business benefits of investment unless new ways

of working are implemented. Engaging all staff in new projects, training initiatives and team briefings are

some of the ways that the culture can be influenced to support the business change that is needed.

Joint working, joint project teams and other joint initiatives, including secondments between partners, can

provide the greater opportunities for innovation and effective project delivery.

Case studyAdur and Worthing Councils – the PAWS partnership(See also pages 24 and 31)Whilst there were clear and quantifiable advantages in combining resources and sharing a depot for

the waste disposal fleet, there were a number of cultural issues relating to joint working that needed to

be resolved before the shared depot could be implemented.

Discussions with staff revealed that some differences in working practices and systems existed

between the two councils, such as fleet vehicles/maintenance, paperwork and accounting practices

existed. There are also different attitudes and beliefs between the two workforces which it is

recognised will take time to overcome, assisted by more involved stakeholder consultation. However,

the pilot project in the incremental partnership provided an opportunity to iron out some of these

differences before implementing further stages.

For full details of this Case Study see www.odpm.gov.uk


Leadership is much spoken about and rightly so. Without demonstrable and strong leadership little can be

achieved other than the continuation of the status quo – whatever that may be for an individual authority.

Case studyNorwich Connect – a 15-year partnership between Norwich CityCouncil with a consortium led by Steria and including AtosKPMG Consulting, BT and Comino

The contract includes renewal of existing ICT and installation of new IT facilities. It includes business

process re-engineering to ensure that the full benefits are gained from the ICT to improve the quality

of the council’s services and gain efficiencies. The contract enforces joint efforts by the council and

the partners for the change management and the project management required to implement far-

reaching changes.

The City Council seconded 12 staff to Atos at the start of the contract for up to three years. The joint

project team scopes the Business Process Reengineering (BPR) studies and carries out redesign, based

on both the professional judgement of the seconded staff and the consultancy expertise of Atos.

Additional credibility is given to the proposals that come forward by the Council staff’s involvement

in the BPR team and is seen as critical to the process.

Savings from the redesigned process are essential to fund the gap between the cost of the new

technology and the existing ICT budget. The savings overall represent about 120 jobs across the entire

council. Heads of departments need to be satisfied that proposals coming forward are workable, will

deliver the benefits to the services and create the necessary savings for affordability.

The seconded staff on the joint project team are highly knowledgeable about existing service delivery

methods and this helps to ensure acceptability of the new ways of working. At the end of their

secondment the NCC staff will continue to use their change management and BPR skills in the future

to further enhance efficiency. This skills transfer is seen as personal development for the staff

involved and assists in the development of partnership working. The NCC team will become a central

unit for continuous improvement.

Two members of staff from Atos have been seconded into NCC in a change management role to assist

the council’s staff in implementing the new business processes.

For full details of this case study see www.odpm.gov.uk


The drive for improved local services requires leadership skills that are unprecedented in any other sector

of business life. Effective leadership is demonstrated by influencing change, communicating and

motivating others and ensuring that everyone has an opportunity to work effectively. Effective leadership

is essential for the success of a SSP. Partnerships require new ways of working and not all employees

will necessarily be wildly enthusiastic.

Leadership skills can help to bring people into the new working arrangements and, over time, can

generate the ownership that is necessary for continuing success. The culture of an organisation is greatly

influenced from the top and the commitment of the top management, including leading members, can

create the climate for partnership working.

Learning points

� Succession planning is important – in or out of a SSP - if there is to be continuity to deliver the vision

for improvement. Succession planning also applies to private sector partners and the voluntary

sectors.

� The quality of the relationship between the partners at all levels is of prime importance to progress

and to address the day-to-day difficulties of managing significant change.

� Trust is fundamental to working successfully in a SSP. Consider all the ways in which trust can be

built – and rebuilt if things have gone wrong.

� Managing change requires effective leadership to bring people into the new working arrangements

and to create ownership.

� Commitment and the continuing involvement of chief executives and other leaders is a key factor in

delivering to challenging deadlines and to progressing change.

� Have a people-management plan for all staff in and out of the SSP. It is people who deliver service

improvement.

� Cultural differences between parties need to be identified and aligned where they are likely to be a

barrier to success.

� Take all opportunities to build sound relationship-management practices – joint training, secondment,

shared interviewing procedures, and mentoring can be helpful ways of building understanding.

� The partner can add value by being involved in the authority at the strategic level.

� Demonstrable leadership will be essential to making the partnership a success.

� Consider the impact and inter-relationships between different partnerships the authority is involved in

for effective corporate learning and integration.


8.The client function

One of the main responsibilities of the local authority is to manage the agreement/contract. All SSPs need

effective agreement/contract management, providing the active management of the formal relationship

between the partners to ensure delivery of the agreed objectives for the partnership. The degree of close

management needs to be proportionate to the value, risk and complexity of the services delivered by the

partnership, and the implications on all partners of both success and failure of parts of the programme.

Levels of client monitoring

The structure of the client side may already have been considered during the vision or business case phase

of the process. Research has identified that it is easy for authorities to recreate the client side in full and to

duplicate the management information systems. This is not good practice and can result in significant

duplication and hence unnecessary cost. By doing this, the authority can also indicate to the provider that

there is an inherent mistrust of the information that they are providing.

Client managers need to understand a wider range of commercial and service issues. A client will need a

range of skills that may need to be developed and honed for greater effectiveness. Some partnerships have

found that they need people who can think innovatively and flexibly, have regard to the different cultures

and values of the partners and can work collectively, negotiating difficulties with maturity as problems

IndependentReview

Scrutiny

User surveys

Supplier information

Monitoring

Knowledge/information


arise. Successful contract managers must have the confidence to represent their organisation in the day to

day ‘give and take’ which is inherent in any real partnership. An absolutely fundamental requirement,

they must have the ability to get on with their partner equivalents – that vital chemistry that cannot be

taught but can clearly be seen in the way the partners interact.

Successful contract management depends on the soundness of the agreement or contract and the

effectiveness of the partnering relationship. The contract management process needs to be conducted in a

positive and co-operative way so that it is both time-efficient and cost-effective for both (or all) partners

and supportive of staff.

Over-detailed or disproportionate arrangements will lead to distrust. However, supplier development and

relationship management initiatives and other incentives are important to build a mutually beneficial

partnership. Monitoring of workforce-related issues should be concerned with those matters identified as

relevant to the performance of the contract, as well as to statutory and regulatory requirements and should

be part of the normal reporting routine to avoid unnecessary burdens on the partner supplier. Monitoring

of the contractual requirements should be the same between in-house and external service providers.

A positive approach to contract management will not only have benefits for the services but will also

provide an opportunity for contractors to develop and enhance their reputation as a good employer

providing good quality services. This will improve market contestability and will stand the authority in

good stead for future tendering exercises.

With regard to health and safety obligations the authority should have monitoring arrangements in place

to ensure that any risks arising from the work contracted out are being managed properly. The level of

monitoring will depend on the hazards and risks associated with the work.

The importance of having sufficient client capacity both for the management of the SSP and other

projects that may be initiated should be considered within a risk management plan. Senior staff

transferred to the partner organisation can mean that valuable knowledge also transfers and may not

benefit the authority in future initiatives.

Dealing with significant change and changing demands will be a feature of managing a partnership, just

as change is a feature of managing in a local authority environment. It is necessary to continue to ensure

that value for money is achieved in any changes that are negotiated and the authority’s overall benefit

from the arrangement is not diminished.


Some of the benefits that flow from effective agreement/contract management

� More favourable outcomes� Delivery of agreed objectives� Improved services with greater customer focus� Better value for money and financial control� Decreased risk � Clarity of the roles, responsibility and relationships� Early identification of difficulties and earlier resolution of problems in a non-adversarial

manner� Clarity of contractual changes and variations� Adaptation of cultural fit

An agreement or contract management plan is an important tool for any SSP as it ensures that the local

authority identifies and addresses all relevant issues over the whole life of the partnership. It is a dynamic

document which is created during the formation of the contract or any partnership agreement and will be

modified throughout the life of the partnership. The need for a written plan gains emphasis where:

� The SSP is fundamental to the operation of the authority

� The SSP has significant public profile

� The consequences of failure are extreme or serious

� The terms and conditions of the agreement/contract are complex.

A review of all the client functions will be necessary, as inevitably some fine-tuning will be required.

This could cover which PIs are monitored on a regular basis, the governance arrangements, and the

assessment of outcomes achieved. It may be appropriate to consider involving an independent third party

to support this process.

As referred to earlier in this guidance, the continuity of the project team moving on into the client

function is a critical aspect of success for the development and evolution of the partnership. Client

managers need to have been recruited or receive training and development prior to the contract award so

that they have a sound understanding of the contract and the environment in which the SSP will function.

However, it is still more beneficial if they have had a key role in delivering the project from the earliest

days as they will retain knowledge of the subtleties of the relationship that were apparent during the

negotiation phase.

Some of the client’s key responsibilities will include:

� Setting out roles, responsibilities and standards

� Monitoring performance, KPIs and milestones for projects

http://www.4ps.org.uk/


� Monitoring the partnership agreement or arrangement

� Development of outcome indicators within an agreed methodology with the partner

� Management of risk, jointly where appropriate

� Effective communication between all parties, without bias

� Monitoring any conflicts of interest that may arise between the parties and facilitating their resolution

Helping to manage the partnership relationship with the authorities ‘user departments’.

� Managing the budget, maintaining financial control and paying for the contract

� Arranging for other scrutiny of the cost or desirability of projects from a third party

� Working with the partner for continuous improvement

� Managing changes or variations to the contract

� Developing opportunities for joint training and briefings to ensure the partnership ethos is widely

disseminated

� Developing joint projects

� Paying great attention to developing the relationship across the organisation

� Succession planning for ensuring continuity

� Resolving difficulties

� Reviewing benefits realisation

� Updating the exit strategy and contingency arrangements.

Risk management is critical to effective decision making. Authorities need to understand what could go

wrong and how they will deal with events if that eventuality arises. Even changes in the external

environment may mean that the chosen course is no longer the right one or realistic. Monitoring and

reassessing risk should be a key component of the relationship between the client and the provider

partners. The SPT guidance Risk Management for Partnerships – technical notes (ODPM 2004) provides

assistance to the risk management role of the client and the project manager in a strategic service delivery

partnership.

As contracts become more complex and for longer duration, the need for changes to the requirements of

the contract will be many. The process of change has to be managed in an equitable way, balancing the

spirit of the SSP with the requirements and obligations of the contract. Suppliers will need to be prepared

to adopt an open-book approach in such contracts and authorities will need to develop the skill and

capacity to address often complex approaches to new projects and changing requirements. The open

sharing of costs must of course be two-way and used in conjunction with a high level of trust and

common objectives for mutually beneficial outcomes. Not always necessarily appropriate for every

partnering relationship, it can be a useful attribute of shared endeavour rather than reversion to an

adversarial ‘trading’ system.


The contract itself will set out the change control and variation procedures and the appropriate clauses

that need to be followed carefully to avoid breaches. However, it may be appropriate to have working

protocols that set out how minor variations are handled.

Organisational development

The client team’s ability to add value to the development of the rest of the authority should not be

underestimated but supported at the highest level. Equally, client teams need to be well supported at the

most senior level to enable effective and pragmatic trade-offs and the resolution of conflicting

requirements.

Organisational learning should flow from the client team to providing continuing improvement in the

authority’s capacity to procure complex projects and manage them so that ad hoc project teams do not re-

invent the wheel each time they set out on a new procurement project.

The drive to improve client capability to assist local government to become a professional procurer of

partnerships is further supported by the Gateway Review process, currently being trialled in local

government by the 4Ps (www.4ps.org.uk). There will also be support from the Regional Centres of

Excellence being developed in 2004 to provide authorities with access to experienced personnel with

specific project and procurement expertise. These teams will be developed jointly by IdeA and the 4ps,

supported by ODPM.

The right staff with the right skills will make a significant difference to the relationship and performance

management of a partnership.

S

Learning points

� Continuity from the project team into the client function is desirable to achieve success.

� The degree of close management should be proportionate to risk.

� Client managers need to be in place prior to contract award to have the depth of understanding

necessary.

� A sound understanding of the contract and all the deliverables by all parties, including any sub-

contractors and council staff, is important to timely progress.

� Clarify the client’s responsibilities and roles.

� Open-book accounting will be helpful to the SSP for changes and new projects.

� The open sharing of costs between all partners will be helpful to the trust and successful pursuit of

common objectives.

� Consider using third-party or other specialist resources to supplement client capacity.

� Working protocols for minor variations to the contract or agreement will be helpful to progress

business efficiently.

� Allow sufficient budget provision for the use of special resources to assist the client function.



9.Performance management and outcomemeasures

Local authorities need to be ever more resourceful in achieving cost efficiencies to release more resource

to front-line service delivery, along with managing performance to sustain improvement. Continuous

improvement and greater cost effectiveness in local public services is at the heart of Government policy.

The imperative for change and sustainable improvement has never been greater. Performance

management is day-to-day delivery against targets that support the authority’s objectives. It is about

everybody meeting agreed targets – directly employed staff and partner organisations with responsibility

for delivery. Everyone needs to know what they have to do so that the targets overall for the authority are

met.

The council will need a clear vision for what it is trying to achieve – its aims and objectives-, whether it

has set out key objectives and sub-objectives, whether it knows what success will look like, the critical

success factors and whether it is measuring its achievements – the outcome/output measures. There

should be a natural flow from why the SSP is being established to how it is measured. In relation to the

success of SSPs, councils should make the assessment in terms of what they set out to achieve.

Authorities that are successful use performance management techniques designed specifically to meet

their objectives. All effective organisations measure their performance in order to know how well they are

doing and to identify opportunities for improvement. Where part of the delivery mechanism is through

another body or partner organisation, it is no less important to the overall effectiveness of the authority

and requires the same amount of attention and focus on the contribution that part makes to the whole of

the authority’s strategic plans.

Being clear about the intended outcomes and the objectives for a partnership is fundamental. To be able to

manage performance and to pay for achievement of performance, the authority must know its starting

What is thecouncil tryingto achieve?

How has thecouncil setaboutdelivering itspriorities?

What has thecouncilachieved todate?

In the light ofwhat thecouncil haslearnt, whatdoes it plan todo next?

Aim, Objectives,Sub-objectives

Critical SuccessFactors

Outcome/OutputMeasures

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point – its baseline – and the objectives it seeks to deliver from the partnership. (See Rethinking Service

Delivery - From Vision to Outline Business Case (ODPM 2003)).

Monitoring performanceMonitoring performance, measured against key indicators and linked to payments for service, is

becoming a standard feature of many major contracts. Performance must be assessed objectively with an

agreed methodology against standards and targets set out in the contract. Authorities should note that in

the absence of verifiable baseline data, it is almost impossible to measure improvement. Performance data

is the foundation of the specification and the benchmark from which continuous improvement will be

measured.

Monitoring needs to be proportionate. It needs to place the minimum burden necessary on both the

service provider and the authority.

The authority will require regular monitoring information on the provider’s service delivery obligations,

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nd that information will normally focus on the achievement of specified performance indicators. The

chievement of defined standards in the area of social and environmental issues, which may be part of th

utcomes the authority wishes to achieve, may be monitored alongside other service specific informatio

onitoring is likely to be an obligation of the service provider, with a regular report provided to the

uthority concerning the achievement of key performance indicators, as well as plans for remedial actio

here these are not met. In order to avoid duplication of resources the authority will normally “audit” th

onitoring rather than setting up its own parallel monitoring.

n the case of social and environmental issues, however, there may be a need to rely on external sources

rrangements may need to be put in place to interview contractor staff, to make site visits (for direct

The foundations for managing SSP performance

� What is the overall aim of the SSP?

� What is the Council seeking to achieve?

� What are the specific objectives – e.g. quality, innovation, new jobs, cost?

� What are the evaluation criteria for partner selection?

� What is the added value from the SSP approach over the in-house alternative?

� What are the critical success factors?

� What does success look like?


bservation), to use questionnaires of end users or a variety of such measures.


The contract conditions will contain measures dealing with the contractual obligations. These will

normally provide for a graduated or cumulative range of sanctions, ranging from warnings through to the

ultimate sanction of contract termination. Advice will be necessary on overcoming the practical problems

of enforcement: for example, the authority itself having to establish loss to claim damages, or that the

breach is fundamental and is not merely a technical breach of contract provision.

Most SSP arrangements will require a service provider to achieve satisfactory levels over a number of

KPIs to receive full payment. If some of those KPIs are linked to social and environmental issues, then

the normal remedy will be withholding some of the contract price for failure to perform.

Specification and performance measures The specification and associated performance measures will need to be developed at an early stage in the

project; this will need to include data on existing services. Experience to date with early projects indicates

that there is a lack of verifiable performance data for existing services.

Thought needs to be given to the link between the specification and the payment mechanism in the

contract. Also, there will be a need to develop key performance indicators (KPIs) to measure whether

outputs are being delivered and outcomes achieved.

The client is responsible for developing an effective system of performance measurement. The key aims

are:

� Delivering the outputs to the required standard and quality

� Ensuring contractors meet their contractual obligations

� Early identification of problems to ensure prompt remedial action

� Price and payment terms are complied with.

Formal review meetings need to take place and these should involve senior personnel from all partners.

The aim of the review process is to:

� Provide an overview of the operation as a whole

� Allow any outstanding issues or problems to be managed in an informed and effective manner

� Anticipate potential problems

� Minimise the incidence of problems and their severity

� Measure performance against key indicators


Measures for performanceOutcomes measures should be SMART (Specific, Measurable, Achievable, Relevant, and Time-related)

Milestones on the way to achieving those outcomes also need to be agreed so that partners can assess

progress as the strategy is implemented. Partners need to be explicit about what success looks like for

them individually and clarify what the shared vision of success in the future is like.

From these foundations relevant indicators can be developed for the evaluation and on-going monitoring.

Regular reviews of progress need to be made and the development of best value measurement for the

relevant basket of services should similarly be reviewed. Successful SSPs will meet performance targets

and price objectives and will feature performance incentives and payments linked to the delivery of

outcomes for citizens. It is also important to remember that in most areas of service delivery there will be

a degree to which both parties contribute to performance. This should be taken into account when

designing the payment mechanism and incentive regime.

Case Study ExampleThe limited liability partnership for building maintenancebetween Sheffield City Council and the Kier GroupSheffield CC has a partnership with the Kier Group to form the first limited liability partnership in

local government. The contract will run for 10 years with a break option at seven years. The contract

is for all building repairs and maintenance and is worth £640m over 10 years.

Incentivisation is provided through exclusivity and guarantees: Kier Sheffield LLP has exclusive

rights in respect of all defined work for 10 years, subject to breach, insolvency, loss of exclusivity,

or withdrawal at the break clause. The defined work is all responsive repairs, cyclical repairs, and

work on vacant property.

The LLP can also bid for additional work such as construction or modernisation schemes. This

process involves submitting a Business Case and the Council assessing whether it represents best

value. The LLP would automatically be included in the tender list when the council puts work out to

tender, unless it chose not to be included.

A turnover guarantee has been granted to the LLP, which reflects the current level of maintenance

work undertaken.



Authorities need to reflect carefully early in the process of procuring the partner on the measures that will

underpin the achievement of the objectives it seeks, as well as during the partnership when circumstances

change. Officers should report to members on the proposed methodology for performance management at

the time the decision to enter into the partnership is taken. The outcomes the authority seeks to support

through the partnership should also be well articulated and be supported by members in the development

of the partnership. Where practicable, it is recommended that relevant Best Value Performance Indicators

(BVPIs) and an appropriate range of industry standards be included in the contract.

The contract will contain details of the pay and performance mechanism (PPM) and will outline how

payment for services under the contract will be determined. Good practice suggests that the PPM should

be kept simple, yet allow for variations in performance. In any contract or partnership agreement it is

important to have a payment mechanism that is linked to the measures that are important to the authority

and which support its objectives for entering into the contract. Those measures chosen to link to the

payment mechanism should be the ones which are critical to success and drive the improvements and

service enhancements that the authority seeks to make. Measuring those things which can be measured –

and there will always be many of these – is simply to provide routine tasks for both or all partners: those

who have to report on such things and those who then need to verify that certain measure have been

delivered.

Performance monitoring needs to take place so that all parties, and other stakeholders, are aware of the

progress of the contract. Performance monitoring will ensure that issues are highlighted at an early stage

and procedures for rectification can be put in place. Performance management will help to identify

whether the objectives of the partnership are being achieved, whether the partnership is providing VFM

and will help to inform future planning. Agreement on monitoring timescales should be obtained prior to

the start of the contract. The information to be monitored should also be identified. It may be that key

performance indicators are monitored more frequently than some of the non-key performance indicators.

The key performance indicators should be chosen so as to provide a high-level overview of the progress

of the contract. The non-key performance indicators should merely support the key indicators.


When establishing the performance indicators before setting up the contract, it may be that any

improvement in performance is set out over the length of the contract. Good practice indicates that

milestones for each indicator should be set. If milestones are not established then it may be difficult to

monitor the performance of the contract. The milestones will also help to establish the feasibility of

achieving the targets.

Case Study ExampleBath and North East Somerset Council with HBS

An incremental partnership for 10 years (signed in June 2003) for ICT, payroll and some of the HR

function with a business improvement service (BIS) built into the partnership.

The partnership has been negotiated on a break-even basis for the above core services. However it is

anticipated that the partnership will be able to deliver savings in excess of the 2% year-on-year

efficiency target. These will be secured by the BIS on a profit-sharing basis.

The council baselined its services using the EFQM model prior to procurement and used the model

to assess the culture of the potential partners who expressed an interest in the project. The baseline

position will be used to assess what impact the partnership has had on services in scope and the

incidental effects on other functions.

The payment mechanism allows the council to make deductions for poor performance but there is a

one-month period for rectification.

The BIS will provide a BPR consultancy and develop robust feasibility and business cases for

change that will address issues that impact on the attainment of corporate plan objectives and

improve the authority’s CPA.

The partner will only receive additional payments if the business case is adopted and the benefits

realised upon implementation; that is, payment by results. Thus the incentive to produce results is

robust.

The ultimate measure of success will be the effect on the council’s CPA

For the full case study, see www.odpm.gsi.gov.uk


In public/public SSPs collaborative working between public sector bodies, including other local

authorities, becomes ever more a requirement for greater cost effectiveness, for making sense of services

from the citizens’ perspective and to remove boundaries from traditional service silos where they no

longer make sense or are inhibiting best practice.

The Green Paper Every Child Matters (DfES 2003) gives even greater emphasis to realigning all relevant

areas involving children’s services – Education, Social Services and Health - and placing the child as the

focus of the restructured services.

However, many authorities are now attempting to address some of these issues and progressing working

in partnership along with piloting such initiatives as Children’s Trusts. The importance of building up a

good strategic case and a business case from which success can be measured still applies (see Rethinking

Service Delivery –from Vision to OBC (ODPM 2003)).

All partnerships need to establish the criteria from which success will be measured and measured

consistently over time as to how the changes impact on the recipients and the overall pursuit of policy

objectives at both the local and the national level.


Case Study exampleThe Association of Greater Manchester Authorities (AGMA) –working together to address Out-of-Area Placements

All top-tier authorities spend significant sums on placing looked-after children into placements often

distant from their home and their own community due to the limited number of local placements and

the increasing numbers of children in such a situation.

There is clearly a potential to improve the service for the children and for the authorities to gain better

control of expenditure by close collaboration and joint commissioning of services with the consequent

opportunities for reinvestment in front-line delivery and improvement.

There are 10 authorities in Greater Manchester forming AGMA and two other unitary councils –

Blackpool Council and Blackburn with Darwen Council – are part of this project. Thus there is a

prima facie case for cost efficiency and improved service.

A business case has been prepared and these are some of the elements:

� Individual out-of-area placements can be in excess of £200k a year

� There are differential charges for similar placements

� The total cost of out-of-area placements across AGMA is £62.8m a year. Potential savings fromcollaborative effort are estimated at £3.6m a year across the partners

� The social agenda for inclusion of children in the normal activities available to most others isundermined by placing them far away from their own community

� Emergency placements are often with what is available rather than what will most help thatchild at that time

� The quality of the placements is variable although there is little formal assessment of thatquality and the implications in the longer-term for the child

� Additional demands are placed on other authorities’ education resources by children beingplaced outside the area

� Social workers and others have to travel longer distances to see the children increasing the costand demand on their scarce resource

� Government and society requires further improvements in services for children that can only berealised through partnership.

This then is the initial criteria from which success can be measured.



As befits a council’s responsibility and continuing accountability for service standards within a

partnership, the contract needs to consider how to address difficulties such as performance not meeting

the required standards. In addition, consideration needs to be given as to how the payment mechanism

should encourage the right level of performance and provide incentives to ‘do better’ than that which has

been provided for within the base payment mechanism.

Contractual provisions will usually include the ability of the council to issue a notice to a provider partner

where there is a material breach of the provider’s obligations under the contract. Good practice allows for

rectification of any errors or problems before a penalty is incurred. By including a period of rectification

the authority will be showing that it is truly working in a spirit of partnership. However, the rectification

period should not be so long as to allow the provider to continue to provide poor service without incurring

a financial penalty. Sometimes the provider partner’s performance is affected detrimentally by a failure of

the council. In these circumstances failure to achieve performance targets by the provider can result in

financial penalties for the council. Whatever the circumstances, a mature partnership should be capable of

dealing with the reason lying behind the performance lapse and ensuring that jointly any problems are

corrected.

The client will be monitoring the outcomes of service delivery, including a reference to any quality

systems that the provider partner has agreed to implement. In the event of failure, a default notice could

be issued that will require the provider to take remedial action within an agreed timeframe. It is in such

situations that the quality of the relationship linked to an effective client role may well prevent such

action being necessary by early collaborative action to steer the performance back on course.

Incentives can equally well play a part by the provider partner being rewarded with additional payments

linked to performance or to enhanced customer satisfaction.


Measuring successIt is important to have a well-developed methodology that will enable objective assessment to be made of

the partnership and the deliverables that are achieved. In a well-managed SSP, performance monitoring

will be managed jointly and the agreement/contractual framework will be designed for the achievement of

policy outcomes, the delivery of which may not be under the total direct control of the SSP or any

commercial partner.

There will, in most areas of service delivery, be a degree to which both or all partners contribute to

performance: this should be taken into account when designing the payment mechanism and incentive

regime. This will lead to the sharing of risk and responsibility.

Performance incentives to do better and to deliver outcomes would ideally be linked to an objective

system of measurement such as the Balanced Scorecard approach (adapted from Kaplan and Norton,

Case Study ExampleWoking Borough Council and Serco Government Services

Woking has entered into a partnership contract with Serco for Streetscene services – street

cleaning, parks, playground, allotments, housing amenity land, etc .

The payment mechanism ensures that Serco receives its base fee with no penalty attached to

achievement apart from if satisfaction falls below a given level or a material breach occurs (such as

continual failure to perform an expected activity).

Serco receives its profit directly linked to customer satisfaction that is measured quarterly by an

independent third party to an agreed methodology. The amount of the payment is based on the

percentages of satisfaction levels achieved. There is a cap to limit the amount of profit in total

within any year.

By putting in place such a mechanism, both partners consider that they are directly measuring a

key outcome - user satisfaction - and the provider partner is incentivised to consistently ‘do better’

in the measurement of this outcome.



1992). In some SSPs, other quality management approaches are used, such as EFQM, alongside

performance indicator systems.

It is important to identify what is culturally suitable for the authority, something that staff will buy into

and that is relevant for the way the authority does business.

(Kaplan and Norton 1992)

Establishing what is to be measured is clearly linked to the key drivers for the SSP and the relative

importance attached to the individual objectives. Ideally, performance reward mechanisms should be

aligned as closely as possible. Reference should be made to the SPT guidance Payment Mechanisms –

technical notes (ODPM 2004) for suggestions on how to achieve alignment.

Using a scorecard to measure success

The scorecard helps to represent the hard and soft elements of SSPs and performance measurement.

There is a need to understand the performance-driven lead indicators as well as the outcome-based

indicators and the cause and effect between them.

The key difference with using the scorecard approach in the partnership as opposed to solely within

the authority is that it is a shared process.


A model can be constructed specifically for the drivers, social and service objectives for the partnership,

taking into account the following:

� The aims and objectives for the SSP, as well as the measures that underpin them

� Apply weightings to all levels to provide a measure of their importance within, or contribution to, the

overall success of the partnership

� Calculate the aggregate total of the achieved critical success factors (CSFs) to provide an indication

of the success of the SSP

� Collate output/outcome measures which contribute to the balanced scorecard.

The original balanced scorecard was based on a measure of four quadrants which considered the views of

a number of stakeholders, including shareholders, customers, management and staff.

However, SSPs fulfill different requirements in organisational terms and as such the research undertaken

by ODPM has recommended an approach built on six high-level objectives rather than the four balanced

scorecard quadrants and this is expanded below.

This model reflects the fact that there are many stakeholders that will have a view on the success of a

SSP:

� The local authority – who will usually have commissioned the SSP

� Central government – in its role as having overall responsibility for local authority public services and

the Shared Priorities (see appendix ) which were agreed by the Central Local Partnership in 2002

� Service users and others in the community


Service user perspectives

Local governmentobjectives

Governmentobjectives

An example of how the results of an analysis translate to the balanced scorecard can be shown in the

following diagram.

WorkforceRelated

Ambitions

Env, Social and Econ Well-Being

WholeAuthority impact

Capacitybuilding

Increased CostEffectiveness

Increased CustomerSatisfaction (Step

change continuousimprovement)

Depending on the authority and its local circumstances, there will be different weightings attached to

different objectives – and to sub-objectives that sit under the different headings. Therefore this approach

differs from the classic balanced scorecard which assumes all objectives to be of equal importance.

How the Government expects local authorities toimprove generally and the contribution that SSPs canmake to furthering that agenda.

Local government priorities for service and genericimprovement including broader objectives such aseconomic regeneration.

Improved service delivery as it affectsthe public or citizens of anauthority’s area.

Stakeholder objectives


High-Level Objective Common Sub-Objective

Environmental, socialand economic well-being

� Environmental protection

� Regeneration of the local area

� Establishment of business centres

� Expanding the operating base into other sectors

� Securing social improvements, for example where social enterprisemodels are being pursued

� Local employment

Capacity building � Addressing capacity shortfalls within the authority – these could relate toa wide range of issues such as strategy development, service delivery,innovation, new access channels, etc

� Building capacity outside of the immediate scope of the SSP

Increased customersatisfaction

(including a step-change and continuousimprovement)

� Increasing customer satisfaction for the services within scope

� More user-focused service delivery

� Innovation leading to greater take-up and inclusion

� Improvements in key service delivery targets (e.g. Benefits processingtimes)

� Securing continuous improvement through payment and performancemechanisms and SSP contractual arrangements, including best valuemethod statements

Workforce-relatedambitions

� Securing employment in an environment where the volume of work maybe declining

� Increased job satisfaction

� Ensuring that TUPE has been applied successfully, the Code of Practice(ODPM 3/2003) recognised, and that a range of workforce-related issuesis secured

� Building local employment

� Career development

Increased costeffectiveness

� Securing savings

� Delivering greater outputs for less or the same

� Accessing additional resources

� Reducing duplication and rationalising service delivery

� Investment in new technologies and assets

� Risk transfer

Whole authorityimpact

� Acting as a catalyst for change within the whole organisation

� Securing other benefits outside of the scope of the SSP

� Building strategy across the whole organisation

� Adding to corporate assessments such as CPA

� Improved processes such as project and performance management


Outcome monitoring

Much data is already collected by authorities and where possible these should be drawn upon for the

purpose of monitoring the outcomes from the SSP and for comparison with the progress of other

authorities or with other organisations delivering similar processes.

The types of measures that authorities should consider might include:

� Established best value performance indicators

� Local performance indicators

� KPIs within the contractual performance and payment mechanism

� Quality of life indicators

� Other indicators or measures – this may simply be the delivery of particular outcomes such as the

establishment of a new regional business or contact centre.

Authorities might find it helpful to capture and monitor environmental data that would help them to

assess whether other factors may have had an influence on the outcomes that are being observed.

Examples might include:

� Details of broader management arrangements

� Changes in political complexion

� Overall funding positions and changes

� Major demographic changes, and

� Other changes in service delivery in services with the SSP

Building the scorecard and reflecting the different weightings will be a matter for each authority and for

each partner. However, measuring the results consistently is what matters.


Learning points

� Performance management contributes greatly to the success of a local authority in meeting its

objectives.

� Authorities need to know the starting point – the baseline – to have the ability to measure success and

the impact on outcomes.

� The payment and performance mechanism within the contract will be what drives the results the

authority is seeking.

� The monitoring regime for a partnership has to be agreed as part of the contractual terms or any

agreement.

� Public/public partnerships need to similarly manage performance and assess the impact of the

partnership on the desired outcomes.

� Incentives should be provided to do better - continuous improvement should be a feature of any

partnering arrangement.

� Allow a period of rectification of performance failings and work co-operatively to help the partner

tackle such failings.

� A systematic approach using a scorecard approach may be used to consistently measure success.

� Use what is culturally suitable for your authority and your partnership.

� Assess the impact on the various stakeholders within the scorecard approach.

� Recording environmental data will assist authorities in determining the other influences that may

impact on the success of the partnership.


10.Dispute resolution

Effective communication is an essential feature of the SSP relationship and can help to prevent many of

the problems that could arise. Communication is important in all relationships and particularly where it

involves significant change – which is most certainly what a SSP brings. The initial dialogue between the

potential partners may well set the tone of the relationship for the duration and careful thought should be

given to this at the time the authority sets out to procure a partner. Once the SSP is in place and the

agreement/contract is signed, communication across the partner organisations at all levels must continue

to be addressed, so that both understanding of and identification with the partnership becomes part of the

culture and ethos of the authority and its partners. Cynics will exist at both member and officer level in

relation to the merits of the partnership. Without strong enthusiastic communication, that celebrates the

successes of the relationship in its early months, the difficulties and problems which will inevitably arise

will be magnified by the cynics and will undermine the partnership at its crucial start-up phase.

Workshops provide excellent opportunities for retained staff and partnership staff to better understand the

change and to work as colleagues in their new roles.

An effective local authority client needs to understand the partner’s business, both in relation to the

individual agreement/contract and the wider pressures on the partner that may affect the partnership.

Many conflicts are created by a lack of understanding of the others point of view. Working things out

together should be central to any partnership, thus avoiding prolonged disputes and certainly litigation.

Empower staff to resolve problems at the lowest level before they become disputes. Partners should aim

to remove the ‘I win/you lose’ element from any area of the business if trust is to remain.

What may cause problems?

� Change in political control where cross-party agreement was not sought or is not maintained

� Lack of leadership – losing the focus on the strategic objectives originally committed by the partners

� Change in management at Chief Executive level with a new person who is at odds with the partnering

philosophy

� Senior management fails to lead and inspire the process or deal with the gatekeepers or other resisters

of change

� Lack of trust which can lead to adversarial behaviour and poor communication

� Other matters in the partner organisations take priority over the partnership and the partnership is

neglected or sidelined

S

� A lack of commitment by the authority to change processes to drive through the full benefits of the

technology investment

� Innovations brought forward by one partner are not facilitated by the other and this leads to other

ideas remaining dormant

� Change in the partner company - vision, strategy, finances – that impacts quickly on culture and

deliverables

� Poor alignment of culture, strategy, structures, process or people

� The understanding of the partnership is not disseminated across the organisations, leading to a lack of

trust, lack of a common ethos, and behaviours not appropriate for a strategic partnership

� Succession planning is not addressed and the visionaries who put the partnership in place move on

� Disagreement about shared benefits and risks in the light of reality

� The design of the SSP was not right for this partnership and corrective action is not taken

� The expectations of the end users are not in line with the terms of the agreement/contract and there is

a failure by the authority to acknowledge the difference between expectations and the procurement

specification rather than subsequent poor performance.

It is clear that many of these difficulties could be avoided by activities being undertaken well, early in the

partnership development or procurement process. However, the reality is that problems and difficulties

will arise and it is how they are addressed that will make the difference to the sustainability of the SSP

and the delivery of the outcomes sought.

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voiding difficulties

The partners need to jointly manage risk and work collaboratively on projects

Be open about problems and consult with the partner on problem-solving

Review objectives on a regular basis and revise as necessary

Document all changes to services and the partnership structure so that there is no misunderstandin

Take time out to look at the big picture and don’t continually stay in the detailed operationalmatters

Involve stakeholders on a regular basis, check satisfaction levels, and encourage innovation andcreative behaviour.

Encourage involvement by the community where relevant and assist the focus on the acquisitionand use of various forms of social capital

Ensure that the different political groups within the council have a sound understanding of the SSand the objectives that it seeks to address.

here disputes do arise, clear procedures will help to minimise disruption and maximise the efficient


andling of any problem. Procedures should ensure that:


� Full details of the problem are recorded

� The partner contractor is notified that a problem has occurred

� The approaches to problem resolution and outcomes are clear and documented

� An open-minded approach with consideration of the facts should apply

� Escalation procedures are clearly defined.

When something does go wrong, the first steps are, identify:

� Exactly what has gone wrong?

� Has it happened before?

� Why has it gone wrong?

� Is it a one-off or is it likely to recur and when?

� Has the authority contributed to the problem?

� Can it be put right and if so, what is the cost to the partners individually?

Disputes should be identified and addressed as soon as possible to ensure effective resolution. Methods

for dispute resolution include:

� Negotiation

� Mediation

� Conciliation

� Arbitration

� Independent expert appraisal

The Centre for Effective Dispute Resolution, a not-for profit organisation, encourages and develops

mediation and other cost-effective dispute resolution and prevention techniques in commercial and

public-sector disputes. (www.cedr.co.uk) Other organisations provide similar services. Authorities should

consider making contractual provision for external arbitration with a named body.

Learning points

A formal dispute resolution process should be part of the partnership/contractual agreement

� Understand one another’s business so that it is easier to understand the stance that a partner may take

� Good communication at all levels keeps dialogue about difficulties free-flowing and less

confrontational

� Discuss real difficulties as soon as possible

� Document problems so that risk management practices can help to eliminate re-occurrences

� Understand the formal mechanisms that are available and avoid costly litigation.


11.Exit strategies – planning the end

Making a partnership a success clearly depends on many factors, not least the formalities or rules of

engagement within an agreement or contract that give both or all partners the knowledge that at the end of

an agreed period the parties can exit through an agreed process. If things go wrong to a significant extent,

the same applies – there is a way out. With that comfort and within that context, the partnership can

thrive.

Nothing goes on forever. Good partners plan the transition both into and out of the partnership together.

Agree before the contract is signed the rules for disengagement. Agree the key matters that need to be

addressed – the people, assets, IPR, service delivery, software and hardware upgrades, maintenance, co-

operation with the successor - whatever is fundamental to delivering the services for which the SSP is

responsible.

It is advisable to also have an exit strategy for public/public SSPs where joint service delivery has been

accomplished as this will give the necessary assurances for future service delivery when the partnership

has outlived its useful life or has terminated for some other reason.

Case study ExampleConsortiumAudit – Corby, Kettering, Northampton andWellingborough Councils in a consortium partnership forinternal audit services

The four authorities are in a partnership for the delivery of internal audit services – to their own

authorities and to external bodies with contracts won in open competition.

The staff in ConsortiumAudit transferred under TUPE to Northampton, the host authority, and new

recruits are on the Northampton payroll and Northampton’s terms and conditions.

The partnership is a legal agreement between the four authority partners and covers the full range of

important matters for service delivery, e.g. accommodation, employees, management arrangements

etc. But importantly it also includes an exit strategy that addresses all significant issues in the event

of termination.

For full details of the case study, see www.odpm.gov.uk


It is imperative that the requirement for completion, extension or renewal of a contract should be

addressed in adequate time to initiate the appropriate action prior to the contract expiry date. Careful and

timely planning ensures that there is a continuity of provision where this is required. Ideally, the partner

contractor will be required to produce an exit plan as part of the original bid process. A robust exit

strategy will describe for all parties what will happen at the end of the contract or in the event of early

termination, and provides certainty that service delivery will not be affected under these circumstances.

Partnership agreements between authorities or contracts approaching expiry need to be reviewed in

sufficient time for the authority to decide what best to do: whether to renew, re-tender or restructure its

approach. This review should be undertaken about 36 months before arrangements are due to expire.

Where authorities are maintaining a corporate contracts register this will further help and provide

information on what is under contract with the authority and from whom. This will provide data for

management on which to forward plan, including expiry dates and resources required for re-tender, along

with the potential aggregation with other contracts coming to expiry that might provide further

opportunities as the SSP draws towards its expiry date.

Where the authority has undertaken other work in conjunction with the partner, under contract to, say,

other councils, adequate arrangements need to be put in place as to how such contracts will be delivered if

the partnership terminates. If the authority has traded in partnership with the other partner using powers

contained in the Local Government Act 2003, such trading would be through a separate company and

disengagement in such arrangements will require similar consideration.

Where authorities are involved in a joint venture company, exit provisions will need to enable the

authority either to realise its investment in the JVC, thereby extracting the value from its investment or

alternatively, for the other party to transfer its interest to either the authority or an incoming partner. How

exit is managed in these instances will be dealt with in the partnership agreement and the company’s

memorandum and articles of association.

Many partnerships adopt a ‘slim’ client structure and rely heavily on the partner provider for data. This

avoids the attempt to replicate professional and technical expertise that has been transferred to the

partnership or contractor. While this is often a sensible use of resources and appropriate, authorities need

to ensure that partners are providing accurate performance data that can be substantiated for an audit and

for a re-tender that will require access to accurate baseline data.


The authority must obtain sufficient knowledge to act as an intelligent client, or be in a position to acquire

such expertise from a third party, when a contract comes up for re-tender. If not, there is a risk that the

client may be over-dependent on the existing partner for information and advice at this point.

Options on exit

� Completion

� A formal completion process should be undertaken at the end of the agreement/contract term, which

will depend on the nature and terms of the agreement/contract.

� Extension

� If the agreement/contract may be extended by an existing option, then the relative benefits of

extension versus alternatives should be considered.

� Renewal

� Where the need for goods and services is ongoing, a new agreement/contract may be entered into or

tendered and awarded prior to the completion of the current contract, with the commencement of the

new arrangements timed to coincide with the expiry of the existing agreements.

Envisaging the end of a partnership at the start of its life provides an opportunity to focus on what the

partnership can achieve in its whole life and how not to leave others with a legacy of difficulties that may

cause bigger problems years from now.

Learning points

� Agree the exit strategy before the agreement/contract is signed, covering all assets and staff that are

needed for service continuance.

� Exit will also need to be possible before the end of the life of the agreement/contract in the event of

significant failure or other defined circumstances.

� Review should take place in sufficient time before the expiry date (at least 36 months) to allow for

assessment of alternatives and any re-tender to take place.

� Consider the capacity to manage exit arrangement and maintain or buy in expertise from a third party

if necessary.

� Ensure access to data that enables exit arrangements to be put into effect.

� Remember to refer back to how to prepare a business case, and conduct and options appraisal and the

other key tasks for entering into a (new) partnership. See (Rethinking Service Delivery – From Vision

to Outline Business Case (ODPM 2003)).


� Ensure the client function has sufficient well-informed expertise to procure a new partner if

necessary.

� A corporate contract register will enable the authority to align other contracts coming up for renewal

for consideration of the best market opportunities with an appropriate bundle of services.

The Shared Priorities

The following themes are based on the Government’s shared priorities with local government for local

service delivery. The aim is to make a difference in local communities to improve people's lives. The test

of whether such initiatives work will be whether, for example, young people get an education, whether

older people are able to live longer in their own homes or whether the quality of our open spaces

improves. The shared priorities agreed between Government and the LGA (in July 2002) require joint

action by a range of key local service providers, including local authorities, the police and the NHS.

The themes agreed between central and local government

Children, young people and families at risk: by tackling child poverty, maximising the lifechances of children in care or in need and strengthening protection for children at risk of abuse

Older people by enabling them to live as independent lives as possible and avoid unnecessaryperiods in hospital.

Promoting healthier communities and narrowing health inequalities by: targeting key localservices - such as health, education, housing, crime and accident prevention - to match need;and the encouragement of healthy lifestyles.

Creating safer and stronger communities by working with the police and other local agencies toreduce crime and anti-social behaviour, strengthen community cohesion and tackle drug abuse.

Transforming our local environment by improving the quality, cleanliness and safety of ourpublic space.

Meeting local transport needs more effectively by improving bus services and other forms oflocal transport and securing better access to jobs and services, particularly for those most inneed.

Promoting the economic vitality of localities by supporting business improvement, providingpositive conditions for growth and employment, improving adult skills, helping the hardest toreach into work, and extending quality and choice in the housing market.


Index

4ps, 9, 33, 48, 66

Accountability, 16, 42Act, Local Government, 1972, 10Affordability, 13Audit Commission, 5, 6, 8

Balanced Date, 5, 6, 8Benchmarking, 9Best value, 37

Centre for Public Scrutiny, 9, 39Client, 9, 62, 64, 67Communication, 12, 84Comprehensive Performance Assessment

(CPA), 5, 81Critical Success Factors (CSFs), 79

Dispute resolution, 4, 16, 84Due diligence, 20

EFQM (European Foundation forQuality Management), 9, 78

e-government, 5Elected members, 15, 38, 41, 42, 45Employees, 7, 18, 21, 22, 59Employment, 13

Forward Plan, 27Full Business Case (FBC), 10

Gateway Review, 9, 10, 48, 49, 66Governance, 6, 10, 14

ICT, 18, 21, 59IDeA, 10, 41Incremental Partnering, 54Investment, 46, 81IPR, 10, 87ITN, 10

Joint Committee, 10, 32Joint Service Delivery, 10Joint Venture Company (JVC), 88

Joint working, 59

Leadership, 15, 60, 61Learning points, 3, 4, 25, 37, 41, 45, 49,

61, 67, 83, 86, 89Limited Liability Partnership (LLP), 11Local Government Act, 10, 11, 32, 39, 40,

88Local Government Act 1972 (LGA 1972),

10Local Government Association (LGA), 5,

9, 10, 90

Management, 3, 7, 21, 25, 28, 65Managing change, 4, 16, 57, 61, 65Measuring success, 4, 77Monitoring performance, 4, 64, 69

Negotiation, 86Novation, 11, 21

Office for Government Commerce(OGC), 5, 11

Office of the Deputy Prime Minister(ODPM), 2, 3, 5, 6, 7, 8, 18, 20, 21, 22,26, 27, 51, 53, 59, 65, 66, 69, 74, 78, 79,81, 89

Open-book, 11, 67Organisational development, 4, 66Outcomes, 11, 71Outline Business Case (OBC), 2, 11, 20,

21, 51, 53, 59, 69, 74, 89Overview, 11, 39, 41, 42, 45, 46

Partnering, 2, 11, 12, 14, 51Partnering agreement, 11Partnering arrangement, 11Partnering ethos, 12Partnership, 1, 6, 7, 12, 14, 18, 26, 34, 40,

42, 59, 79, 88Payment Mechanism, 78Performance monitoring, 72Property, 10Protocol, 12


Public Service Agreement (PSA), 11, 27Public/private SSPs, 12Public/public SSPs, 12

Relationship management, 3, 12, 50Risk, 7, 21, 65, 81Risk management, 21, 65ROI (Return on Investment), 46

Scrutiny, 39, 41, 42, 45, 46Service delivery, 5, 7, 10, 12, 14, 15, 17,

25, 28, 32, 35, 38, 41, 43, 44, 47, 48, 65,68, 69, 71, 76, 77, 81, 82, 87, 88, 90

Service provider, 90SMART, 71Social Enterprises, 12Stakeholder, 13Strategic Partnering Taskforce (SPT), 1,

2, 5, 6, 7, 8, 9, 15, 26, 53, 54, 65, 78

Strategic Service Delivery Partnerships(SSPs), 5, 6, 14, 15, 22, 28, 32, 38, 46,49, 50, 54, 57, 62, 68, 71, 74, 78, 79, 87

Succession planning, 3, 50, 51, 61, 65, 85

Towards a National Strategy for LocalGovernment, 5

Transfer of assets, 3, 18, 19Transfer of bureau, 18Transfer of staff, 3, 18Transition, 3, 13, 16, 17, 22, 25Trust, 3, 35, 51, 61TUPE, 13, 17, 18, 20, 21, 81Unincorporated, 10

Value for money, 13Variations, 13VFI (Value from investment), 46VFM (Value for money), 13, 37, 43, 46,

47, 49, 54, 72Vision, 2, 51, 53, 59, 69, 74, 89

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