Commercial Best Practice
1. Locally lead the NHS
2. Work with community partners
3. Engage with public and patients
4. Collaborate with clinicians
5. Manage knowledge and assess needs
6. Prioritise investment
7. Stimulate the market
8. Promote improvement and innovation
9. Secure procurement skills
10. Manage the local health system
11. Make sound financial investments
Where Procurement Skills have Impact ?
World Class Commissioning Competencies
PROCUREMENT SKILLS
1. Locally lead the NHS
2. Work with community partners
3. Engage with public and patients
4. Collaborate with Clinicians
5. Manage knowledge and assess needs
6. Prioritise investment
7. Stimulate the market
8. Promote improvement and innovation
10. Manage the local health system
11. Make sound financial investments
23
4
56
7 8
9
1011
Strategic SourcingSupplier Relationship ManagementSupply Chain Theory
Market Engagement and AnalysisBusiness analysis and commercial planningStakeholder/Customer Relationship Mang
Project ManagementSpec Dev, Tendering, Legal and RegulatoryCommercial, Finance, Budgetary, AccountingContracting and NegotiationMarket ManagementContract and Performance Management Contractor and Supplier Management
8
9
10
1
1. Analyse Undertake Opportunity Assessment Service/Needs Review Data Collection and Analysis Benchmarking Market Analysis
2. Plan Establish Stakeholder Groups Demand management Develop Procurement Strategy Develop Project Plan and Risk Register Use best practise models to develop Expressions of Interest, Pre-Qualification Questionnaires,
Specifications, Invitation to Tenders, Evaluation Criteria, Draft Contracts, SLAs and KPIs
3. Do Manage the Tender Process Provide Legal Advice and Contract Drafting and Production Negotiate Contractual Terms & Conditions, Price and Performance Contract Award and Implementation
4. Review Develop Supplier Relationship Management Ongoing Supplier management against Contract Terms, SLAs and KPIs Benefits Tracking Periodic Stakeholder Reviews
Procurement Stages
Commissioning Cycle and Competency 9 - Procurement
Strategy Cycle
Operational Cycle
Priority Setting Service Design
Strategic Commissioning
Supplier/Contract Strategy
Budget/Affordability Model
ServiceSpecification
Market Management
OperationalReporting
ContractManagement
Supplier Development
Needs Assessment
Demand Portfolio
Contracting Process
Adapted from Newchurch for the Leadership Academy
Source: IPC framework for joint commissioning and purchasing of public care services - CSIP
Procurement forms an integral part of the process...
Commissioning and Procurement examples:
1. Analyse Current & future needs
Suppliers strengths and weaknesses
2. Plan What is being provided and what is
needed Developing service specifications
and decide on contract type and terms
3. Do Decommissioning redundant
services Tendering requirements and letting
contracts
4. Review Identifying any change in
population Monitoring and reviewing contracts
Integrated Commissioning
Review
Plan
Do
Analyse
PROCUREMENT
PROCESS AND
SKILLS
COMMISSIONING PROCESS
Gap Analysis
Joint commissioning
Strategy
Service Design
Change Management
Budget & Market Management
Strategy Monitoring Performance
Management and Review
Purpose and Guidance Market Analysis Resource
Analysis
Risk Analysis
Supply and Demand Analysis
Procurement forms an integral part of the process
1
23
4
3
4
4
5
6
7
7
6
8
8
8
9
101011
11
2
2
2
87
Project Management
Operations
Commercial/Procurement
Medical/Clinical
IM&T
Legal and Regulatory
Finance
Communications
PURCHASED HEALTH CARE
COMMISIONING SKILLS SET
Market Engagement and Analysis Business analysis and commercial planning Project Management Strategic Sourcing Supplier Relationship Management Supply Chain Theory Stakeholder and Customer Liaison and Relationship Management Specification Development, Tendering, Legal and Regulatory Commercial, Finance, Budgetary and Accounting Contracting and Negotiation Market Management Contract and Performance Management Contractor and Supplier Management
World-class Commissioning identifies Procurement as one of the key organisational competencies that PCTs need to secure to deliver health and care services, these skills comprise:
Procurement Skills
Key Statements of Procurement Maturity
Procurement impact / value
Board visibility and interaction
Demand management, innovation and engagement
Management information
Policy and process compliance
Sourcing / market management
Purchasing processes
Supplier relationship management
Collaboration
Green / sustainable
The PCT recognises that the benefits of procurement are greater than cost reduction, and procurement supports the strategic agenda of the PCT
Procurement elements of commissioning are represented and addressed at board level
The PCT systematically challenges demand, introduces innovation and optimises resources whilst engaging with clinicians and other stakeholders
The PCT has full visibility of its external spend, provider performance and commissioning function performance
The PCT shows high levels of compliance to policy, processes and contracts established or selected by the PCT
The PCT has commissioned the right contracts, with the right providers, through the right route, in full knowledge of the options and how they will meet their needs
The PCT is acquiring all products and services through an efficient purchasing process
The PCT is developing effective relationships with key providers
The PCT is taking advantage of collaborative opportunities and is aware of the potential benefits and value brought by collaboration
The PCT is maximising social and economic benefits and minimising damage to the environment through the services it commissions
Aligning the Procurement Diagnostic with WCC
WCC Competency
Maturity Statement
Lo
ca
lly le
ad
the
NH
S
Wo
rk w
ith c
om
mu
nity
pa
rtne
rs
En
ga
ge
with
pu
blic
an
d p
atie
nts
Co
llab
ora
te w
ith c
linic
ian
s
Ma
na
ge
kn
ow
led
ge
an
d a
cc
es
s n
ee
ds
Prio
ritise
inv
es
tme
nt
Stim
ula
te th
e m
ark
et
Pro
mo
te im
pro
ve
me
nt a
nd
inn
ov
atio
n
Se
cu
re p
roc
ure
me
nt s
kills
Ma
na
ge
the
loc
al h
ea
lth s
ys
tem
Ma
ke
so
un
d fin
an
cia
l inv
es
tme
nts
Demand management, innovation, stakeholder engagement
X X X X X X X X X
Visibility of spend and performance X X X X X XCompliance X X XCorrect contracts and providers X X X X X XEfficient procurement processes XEffective relationships with supplier X X X X X X XCollaboration X X X X X X X XMaximising social and economic benefits
X X X
Recognition of wider benefitsBoard involvement
The Blueprint is based on a framework which covers all the key activities of a PCT as a commissioning organisation
13
A.T. Kearney
House of Commissioning*
1. Strategy, Organisation
& Governance
1. Strategy, Organisation
& Governance
5. Segment strategy &
Implementation
5. Segment strategy &
Implementation
4. Health Market Analysis
4. Health Market Analysis
6. Segment & Provider Management
6. Segment & Provider Management
9. Performance Management
9. Performance Management Knowledge / Information
ManagementKnowledge / Information
Management
12. Support Functions(HR, Finance, Legal, IT, Estates)
12. Support Functions(HR, Finance, Legal, IT, Estates)
3. Clinical Leadership3. Clinical Leadership
2. Public Health
Management
2. Public Health
Management
Strategic Commissioning
11. Talent Management & People Development11. Talent Management & People Development
10. Knowledge & Technology Management
10. Knowledge & Technology Management
Processes
People(1)
Information & Data
• Provides a dedicated market management role over three “dimensions” (segment, provider and system)to ensure strategies are delivered,
• Provides a dedicated market management role over three “dimensions” (segment, provider and system)to ensure strategies are delivered,
8. Programme & Change Management
8. Programme & Change Management
7. Stakeholder Engagement & PPE
7. Stakeholder Engagement & PPE
Notes: (1) Includes skills, knowledge and behaviours * Adapted from A.T.Kearney’s House of Purchasing and SupplySM
Sources: AT Kearney
• Centre-led strategy for commissioning that is linked to the PCT’s overall Strategy and Operating Plan
• Multi-year plans for leveraging provider market opportunities
• Greater focus on strategic vs transactional activity
• Centre-led strategy for commissioning that is linked to the PCT’s overall Strategy and Operating Plan
• Multi-year plans for leveraging provider market opportunities
• Greater focus on strategic vs transactional activity
• Deployment of advanced techniques to model current and future needs – identifying trends and shaping provider markets
• Deployment of advanced techniques to model current and future needs – identifying trends and shaping provider markets
• Priorities are identified based on a clear set of goals and an understanding on the market opportunity
• Categories are assessed for collaborative sourcing opportunities
• Priorities are identified based on a clear set of goals and an understanding on the market opportunity
• Categories are assessed for collaborative sourcing opportunities
• Strategies are developed based on a deep understanding of the current and prospective provider market – eg, non- traditional providers
• Should cost analysis is used to support provider discussions
• Strategies are developed based on a deep understanding of the current and prospective provider market – eg, non- traditional providers
• Should cost analysis is used to support provider discussions
• Pro-active and systematic measuring of commissioning outcomes
• Measures linked to the overall goals of the organisation
• Pro-active and systematic measuring of commissioning outcomes
• Measures linked to the overall goals of the organisation
• Broad understanding of specific role in supporting overall commissioning goals – eg, recruitment strategies requiring greater engagement with universities; legal considerations relating to market strategies
• Broad understanding of specific role in supporting overall commissioning goals – eg, recruitment strategies requiring greater engagement with universities; legal considerations relating to market strategies
• Data across the full spectrum of providers/services available in a form to support commissioning activity
• Category strategies , contracts , etc, are stored electronically and readily available to key stakeholders
• Data across the full spectrum of providers/services available in a form to support commissioning activity
• Category strategies , contracts , etc, are stored electronically and readily available to key stakeholders
• Commissioning is directly engaged in with patients to define requirements
• Proactive and reactive media management processes
• Commissioning is directly engaged in with patients to define requirements
• Proactive and reactive media management processes
• A systematic process for assessing future commissioning needs based on capabilities, skills, etc
• Talent identified and nurtured – use of individual development and retention plans
• A systematic process for assessing future commissioning needs based on capabilities, skills, etc
• Talent identified and nurtured – use of individual development and retention plans
• Use of a range of contract types based on need
• Provider management covers strategic as well as operational goals
• Use of a range of contract types based on need
• Provider management covers strategic as well as operational goals
• Supporting commissioning process through market-facing specification improvement initiatives
• Provides clinical leadership, governance and assurance
• Supporting commissioning process through market-facing specification improvement initiatives
• Provides clinical leadership, governance and assurance
Not Exhaustive
D
E
M
A
N
D
GATHER DATA AND ANALYSIS
Requirements Planning
Customer Demand
Policy Initiatives or Imperatives
PLANNING
Recurring Requirements
Unforeseen Requirements
Prioritisation
Aggregation
Co-operation
Collaboration
Procurement Strategies
Procurement Plans
Market Intelligence
C
O
N
T
R
A
C
T
I
N
G
Frameworks
Call Off Contracts
Service Contracts
Supply Contracts
Contract Management
Supplier Management
Performance Management
Contracts Administration
ACQUISITION
S
U
P
P
L
Y
Develop Specifications
Supplier Landscape
Procurement Strategy
Supplier Capability
CATEGORY MANAGEMENT
The schematic below illustrates Kearney’s industry standard process flow of Strategic Sourcing
World Class Commissioning Competencies and the Commissioning Process
Overview WCC in Processes
Access Needs
Review Provision
Prioritise
Define Services
Shape Supply
Communicate Change
Manage Performance
Plan5. Manage knowledge and
assess needs6. Prioritise investmentsEngage and Lead
1. Locally lead the NHS
2. Work with community partners
3. Engage with public and patients
4. Collaborate with clinicians
Procure7. Stimulate the market8. Promote improvement
and innovation9. Secure procurement
skills
Manage10. Manage providers11. Make sound financial
decisions
The Good Practice Framework
ContractStart upContractStart up
ProcurementInitiation
ProcurementInitiation
Policy ContextPolicy ContextNeeds
AssessmentNeeds
Assessment
ProcurementRoute
ProcurementRoute
Specification DevelopmentSpecification Development
ConsultationConsultation
MarketSoundingMarket
Sounding
Evaluation PlanEvaluation Plan
StandardContractsStandardContracts
TenderingTendering
Provider SelectionProvider Selection
ContractAward
ContractAward
OutcomesOutcomes
Current Service & Demand
Current Service & Demand
Contract Review
Contract Review
BenchmarkingBenchmarking
Market Assessment &
Stimulation
Market Assessment &
StimulationOptions
Development & Resourcing
Options Development & Resourcing
Pricing ModelPricing Model
Commissioning Plan and Business Case
Commissioning Plan and Business Case
Performance MeasurementPerformance Measurement
Continuous ImprovementContinuous
Improvement
Strategic Review
Strategic Review
StrategicPlanning
Acquisition
Performance Management
Stakeholder Engagement
Where can CSUs add value?
Skills and capabilities for assessment
Clear vision & leadership
Robust governance
• Benchmarking
• Cost base analysis
• Coding practice
• Process redesign• Admin & FM productivity & management
• Performance management•Quality Account management
• Service line management
• Rostering& workforce strategy• Theatre planning and scheduling• Capacity planning and scheduling• Clinical engagement
Productivity & performance improvement
• Spend analysis
•Procurement strategy, structure and skills• Sourcing and category management
Supply chain management & strategy
• Contract and supplier relationship management
• Distribution and inventory management (departmental and cross-Trust)
• Purchase-to-pay process improvement
• Benefits realisation and tracking
Market planning & strategy• Demand forecasting• Customer analysis (incl. commissioning strategy)
• Competitor analysis
• Private income strategy
• Core strategic analysis (e.g. PEST)
Change management & project management
• Project management
• Project planning & resource allocation
• Stakeholder management
• Patient involvement and experience strategy
• Marketing & communication
• Management information & reporting
• Overall & service line governance
Top Related