article
An education in sharing
23 July 2008
The business case for sharing services is compelling. According to
the latest statistics the Government states that up to £23bn in
savings had been achieved since 2004, surpassing a target of £21.5
billion. However a major report by law firm Browne Jacobson sheds
new light on the level of savings that can realistically be
achieved and reveals a series of critical barriers preventing
public sector bodies, including those engaged in the Education and
Social Care sector, in seeking to reap the full benefits of shared
service initiatives.
The Shared Services Survey 08 is the
result of research carried out among 178 senior and middle managers
across the public sector. According to the study, 98% of those
working in Education and Social Care are positive about the shared
services agenda. Of the 41 senior and middle managers from the
Education and Social Care sector taking part, 74% agreed that the
long term rewards of sharing services justified the ‘short term
pain’, with more than half (54%) identifying advances in IT as
offering the greatest opportunities for sharing services.
In fact those working in Education and Social
Care generally perceive more benefits from Shared Services than
other sectors. The ‘delivery of joined up services’ was seen to be
particularly beneficial with over two-thirds of Education and
Social Care managers regarding this as a significant or very
significant benefit. The London’s eAdmissions service is a prime
example of how shared services are benefiting local communities and
enhancing local authority services. The system was launched in
September 2006 and was developed to allow the 33 London Boroughs to
offer online school admissions.
However the report also identified a plethora
of barriers to implementing shared services with more than
three-quarters of Education and Social Care managers (85%) citing a
lack of financial resources, whilst 71% identified insufficient
manpower as key. Managers also seemed less optimistic about the
level of savings possible compared to government estimates.
According to the study senior managers in Education and Social Care
believe a total of 11% of their organisation’s budgets could be
saved by sharing services over time. This is against a backdrop of
publicly stated central targets of 3% per annum as outlined by Sir
Peter Gershon’s review of public services.
Procurement risks were seen as especially high
for managers in this sector. Around 7 out of 10 managers see
procurement as a significant concern, compared to only 47% of
health sector managers. 49% of Education and Social Care
managers considered apportioning responsibilities to each partner
when designing contracts to be a significant risk. There were
also significant concerns that shared services schemes may not be
viable if one partner withdraws, or in the event of a serious
disagreement.
The research also identified the key drivers
behind shared services, namely senior managers and elected
representatives. Front line workers are seen as a driver of shared
services by just 20% of Education and Social Care managers, and the
public by just 15%. This may shed light on the “back office”
emphasis when it comes to shared services, with only half of those
engaged in the sector seeing the potential for front line services
according to Browne Jacobson’s study.
The risks and barriers highlighted perhaps go
some way to explaining why Government targets aren’t being achieved
despite the overall positive views towards the agenda. Managers
need to be aware that in implementing shared services the
challenges that will inevitably arise are not insurmountable
and need to be addressed before the long term benefits can be fully
realised. Buy-in from all stakeholders is key. Clear consultation
and communication with employees, unions and local representatives
is essential if many of the hurdles are to be overcome.
An approach must be developed for the consolidation of front
line services. Embracing partnerships with the private and
voluntary sector could also offer further opportunities and
expertise, as well as helping to gain funding which is so vital to
set up. With such ambitious government efficiency targets in place
for the coming years, shared services will remain high on the
strategic agenda for public sector leaders. A bolder approach, and
greater focus on the front line and the demands of citizens, may be
required as we move into the next phase of the public sector
efficiency drive.
To access a full copy of the report go to: www.brownejacobson.com/sharedservices
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