AoC Grant Fund Projects:New Models of DeliveryCreating the environment for reinvention and innovationIntroductionIt is undoubtedly This short report summarises six project casetrue that reductions studies (www.aoc.co.uk/shared-services/case-in government studies) that received assistance from the Sharedfunding have been Services Grand Fund to implement new ideas,a key motivator for models, techniques and strategies for the benefit ofthe surge of interest the further education (FE) sector as a whole.in shared servicesand new models of The Six Project Case Studies are:delivery over thelast three years. In `` City College Norwich – Transformingthe wake of seed Education in Norfolkfunding from the `` The Wessex FederationSkills FundingAgency, simply `` Federation of Strategic Servicessaving money may `` Shared Services Sussex and Surrey Collegesbe the key aspiration `` Adult Enterpriseof new partnershipsand collaborations `` Quality Improvement using lean and six sigmabut there are many processesother aspects to beconsidered.
Setting up new models of deliveryThe diversity of shared service projects is a credit to the many architects of the new FE legal paradigm.Groups of Colleges are now collaborating and exploring new models of delivery in ways unimaginableimmediately after the era of incorporation. Whilst the visions and outcomes of each project can rangefrom simply sharing practice on enrolment procedures to creating a new educational landscape foradult enterprise, the underlying leadership and change-management processes used are remarkablysimilar.Robin Gadd, Project Director for the Wessex Foundation, summed up the three stages as: Can we do this? (Feasibility study) Should we do this? (Business case) How are we going to do this? (Implementation plan)The South East Group of Colleges using Lean and Six Sigma processes articulates the common journeyin a little more detail: identify specific elements of provision that need to be improved identify all associated processes and their physical locations determine the current baseline performance for each chosen issue identify the current cost and impact of the issue clearly articulate the intended outcome identify and recruit appropriate staff to the project team, and finally begin the quality improvement journey.Permeating all of the above stages was the need for carefully considered communication plans.Tim Strickland, Managing Director of the SISSC project (Shared Services in Sussex and SurreyColleges) and CEO of FE Sussex Ltd states: “All of our Principals coordinated the release of importantcommuniques, so that debates happened at the same time in each College.” As well as the top downrelease of vision and overall direction, Dick Palmer, Chief Executive of Transforming Education inNorfolk (the TEN Group) is clear that staff need to be fully involved in the evolution of the ideas andprocesses: “You have to manage the staff engagement regularly – you can’t do it with one roadshowand an email.” Robin Gadd, Project Director for the Wessex Federation, described this as using“Internal politicians to drive implementation”.Most projects, however, recognised an additional and essential step that comes before: ‘Can we dothis?’ For collaborations such as SSISC (Shared Services in Sussex Colleges), this preliminary stepwas taken over a decade ago by the formation of FE Sussex Ltd. Through years of sub-regionalcollaboration, the partners had developed a level of trust that enabled them to enter into sharedservice discussions free from suspicions and ulterior motives.
Models and legal structuresAt the outset of any large scale collaborative project, there can be a temptation to create a fullyarticulated vision of how the new partnership will work. What is clear from this series of case studies,however, is that while it is important to be clear about overall aspirations, the journey to pragmatismwill be buffeted and shaped by the demands of others, the expertise of operational staff, and theregulatory frameworks of stakeholders. For five of the projects, this resulted in the formation of aseparate, but wholly owned, limited company. The advantages of this model are that agreementsbecome binding, providing a secure footing for financial planning and in some instances theemployment of shared service staff. The approach also enables partnerships to meet the requirementsof the VAT cost-sharing exemption and competitions law. Within this approach, however, areimportant variations. Three of the newly created companies are limited by guarantee, one is limitedby shares, and one is a limited liability partnership.Whilst this is still an unfolding picture, it is clear that the project teams want to limit their liabilities,without limiting their possibilities. Partnerships choosing the limited by guarantee option, with itsaccountabilities to members rather than shareholders and focus on the ‘community’ it serves ratherthan profit, often go on to seek charitable status. For Matt Atkinson, Principal of City College Bathand Chair of Adult Enterprise states this decision isn’t clear cut: “There’s a downside to charitablestatus as it can actually limit what you can do.” If the partnership’s aim is simply to set up a jointventure to service its members’ needs, then limited by guarantee with charitable status may well be anappropriate vehicle. So it is the grandness of the vision that determines the final choice of legal entity.For the TEN Group and SSISC teams, ambition to grow an important part of the project aims. Theydo not want restrictions on their ability to raise finance or, for SSISC at least, to provide a commercialservice for other colleges and the wider education sector. Tim Strickland highlighted the fact thatSISSC Ltd is a joint College enterprise and, like any other venture, has targets to meet and costs tocover.For the remaining Grant Fund projects, focused on sharing and developing good practice and jointprocurement, there was no need to create a separate business entity.OutcomesWhilst outcomes will inevitably become clearer over time, there will probably never be a definitive listfor any of the shared services projects due to the complexities and far-reaching effects of these newinitiatives. That said, it can clearly be seen from the six Grant Fund case studies, that all have achievedtheir first-year savings targets – and much more.Common to all of the case studies, and the shared service agenda as a whole, is the recognition thatthe FE paradigm has changed and that there has never been a better time to invest in innovation– sweeping away the accumulation of ‘established’ practice and the tradition of incrementalimprovement in favour of reinvention. Colleges have teamed up not simply to share good practice, butto share their issues and challenges.Back-office practices have been re-engineered and the new possibilities provided by ever-increasingIT capabilities are being realised, resulting in service improvement and staffing efficiencies. Fromincreasing utilisation of staff involved with collective procurement, to reducing the number of humantransaction in a supply chain, year one savings from these six case studies alone is in the region of£4M. Forecast savings rise to many millions by the end of year five. However does this represent the