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Making the business case - Alpha | Sarah Prag | October 2015
The document presents an analysis of costs and potential savings associated with local waste service standards, emphasizing the challenges of acquiring comprehensive data from multiple councils. It estimates a potential national saving of £650 million over seven years if councils adopt digital solutions and upgrade their contracts, highlighting specific areas for efficiency, such as customer contact and digital front-end costs. The text calls for a discussion on the model's utility and accuracy, as well as further exploration of costs and savings for suppliers.
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Making the business case - Alpha | Sarah Prag | October 2015
- 1. Local Digital Programme Building the business casefor standards Sarah Prag, @SarahPrag Independent Service Design Lead DCLG Local Waste Service Standards Project #LocalDigital @LDgovUK bit.ly/WasteProject
- 2. Cost of fuel Costof complaints Cost of investigating a “missed” collection Cost of running/supporting online tools and forms Cost of answering calls Check info Check info Report online Ring up Answer Check logs Ring back? Schedule collection Drive to address Report/c onfirm Running costs: Missed collections Set up costs Customer contact Investigation Resolution New contract costs (time spent specifying, documenting, data reformatting etc) Digital front end costs (building forms, licences) Integration costs (integrating a new service with a CRM, customer account etc) DCLG Local Digital Programme 2015
- 3. DCLG Local DigitalProgramme 2015
- 4. DCLG Local DigitalProgramme 2015 What did we learn? - Hard to get an end to end set of figures for any one council, but enough to piece together an initial picture - Trends did emerge e.g. 0.05 missed bin contacts per household, £10k to clean up data - If contracts are renegotiated every 7 years on average then 50 councils are going through that every year
- 5. Tendering process (Costs: £140kpeople time Could save: £120K Cleaning & prepping data Costs: £10k Do it once and save £10k next time Integration costs Costs: £300k Could save: £150k Digital front end costs Costs: £240k (5 waste services) Could save: £120k Set up costs & savings for an average council (68,000 households) Cost of answering all waste calls: £61k Offering a better online option and shifting 80% to that could save: £49k Customer contact Cost of keeping online tools and forms up to date: £120k per year More automated updates could save £90k per year Investigating/processing waste related contacts Costs: £300k Could save: £250k Resolution Hard to break this out of overall running costs Running costs & savings for an average council DCLG Local Digital Programme 2015
- 6. Tendering process £9.2 million Cleaning& prepping data £3.5 million Integration costs £49.5 million Digital front end costs £39.6 million One off savings across all 350 councils Fewer calls = £17.1 million Customer contact More efficient online content & forms = £31.5 million Investigating/proce ssing waste related contacts £87.9 million Resolution ? Running savings across all 350 councils DCLG Local Digital Programme 2015
- 7. Where does thereally big number come from? - We’ve talked about saving £650 million over 7 years - This is based on 50 councils “upgrading” to the standard each year for 7 years as they renegotiate their waste contract - Each of those councils could save almost £300k on the set up costs and then £390k each year after that in running costs… which adds up to £650 million nationwide DCLG Local Digital Programme 2015
- 8. What might itcost to unlock all of these savings? - Maintaining & promoting the standard (£50k per year) - Covering the £10k data prep costs for every council? (£3.5 million) - Covering the costs of the first 20 councils to go for it? (£11 million) DCLG Local Digital Programme 2015
- 9. What next? - Isthe model useful? - Are the numbers right?! - Can we plug some of the gaps? - What about the costs & savings for suppliers? - Come and discuss further in the session later! DCLG Local Digital Programme 2015
Editor's Notes
- #3 Based on what we’d learnt in Discovery, this is what I originally can up with, and shared with MVC An end to end view of a service Where are the avoidable costs? Which of these might be reduced by use of standardized data?
- #4 And I asked them to answer specific questions based on this – to give us the data. In plain English, based on how the service is set up and run , end to end
- #6 And this is the picture I was able to build up Note: I think the costs of updating the online offer may be too high
- #7 350 councils in the UK that manage waste services Renegotiate every 7 years – so 50 doing it in any year