SubscribeGovernment policy development is becoming increasingly rapid, and the electorate more demanding in terms of demonstrable cost efficiencies and simple, flexible access to information.
Services are also becoming increasingly interrelated by virtue of the citizens using them and the processes required to support their delivery.
The Shared Services team recently established within the Cabinet Office will address this challenge by investigating how Government and Public Sector organisations can achieve significant savings and increased effectiveness by better management of the way in which corporate services are procured.
Major General Bill Robins, MOD Director General for Information and Communication Services (1995-1998) explains how Defence has benefited from the Shared Services principle through a number of initiatives, including the Defence Fixed Telecommunications Agreement.
"The concept of shared services is evolving. In the Public Sector, it initially meant the replacement of legacy networks and back office systems with fewer and better services. Some local governments developed the idea further by using previously unreachable private sector expertise by outsourcing back office functions like ICT and HR.
True Shared Services and economies of scale can then be gained by joining forces with similar organisations. Some geographically related county and district councils share resources, for example Chester County Council provides Information Technology services to Crewe and Nantwich District Councils.
Defence already demonstrates shared services in action with the Defence Fixed Telecommunications Service Agreement. Signed in 1997, DFTS was a groundbreaking Private Finance Initiative managed by BT in partnership with the Defence Communication Services Agency (DCSA).
The agreement transformed the MoD's Wide Area Network (WAN) within the UK. It reduced the 19 networks and 46 services all operated separately by the individual Armed Forces to one unified network and six services, providing interoperability between the Forces and saving the MoD £70m each year.
Other organisations with a requirement for similar services can now take advantage of the investment already made by utilising the agreement. DFTS supported the G8 conference in July 2005 and, through a Memorandum of Association, the Defence Science and Technology Laboratory (Dstl) and the Meteorological Office are set to make savings with access to DFTS services.
Outsourcing MoD services is a good way to increase the agility and flexibility of services. It delivers value for money and ensures consistency with the latest technology. However, it also brings new challenges, including balancing cultural differences and managing complex relationships with many organisations. Suppliers must foster a partnering approach, not only with MoD themselves but with other suppliers engaged in complementary lines of business.
This will be particularly important for Defence as the UK moves to develop its Network Enabled Capability (NEC), the ability to link operational forces by smart networks to ensure faster reaction times, more controlled application of force and more comprehensive awareness of what is going on. DCSA is a major player in the NEC initiative and DFTS is proud to play a part in it.
The partnering approach is vital for the Shared Services agenda. Industry partners delivering services for Government cannot work in isolation but must co-operate, which requires a fresh business model and an innovative approach to risk management.
An example is the important relationship being developed between DFTS and DII. Several co-operating groups have been set up between DFTS and the consortium Atlas, led by EDS, who were awarded the contract to deliver the Defence Information Infrastructure Future (DII(F)).
The MoD needs the relationship between these two large programmes, operating two separate contracts, to be close and productive. Working together the teams are successfully resolving issues and supporting the project delivery milestones.
With over 1300 public sector organisations in the UK, there is a huge opportunity to consolidate services across organisational boundaries. But management grip and commitment is needed; for example as part of the DFTS Agreement, the MoD has developed a WAN policy that directs that any requirement within Defence for a voice or data network should be supplied by DFTS. By doing this MoD is able to generate economies of scale and ensure continued savings.
MoD can also be assured of value for money in the transaction through regular market benchmarking. The key point about such arrangements is they work only if the customer organisation is committed to them at the highest level.
Moving away from the traditional procurement models towards Shared Services may be a difficult cultural shift for government but reference agreements already in place show the success of the principle in action.
I have the impression that the UK Government is now committed to a Shared Services culture that releases efficiencies through standardisation and simplification.
This should enable it to provide a faster response in delivering policy objectives through greater organisational flexibility, agility and interoperability. The Shared Services agenda puts citizens, the ultimate customers, at the heart of the organisation.
Those customers have a right to expect efficient, responsible and cost-effective spending from the public purse. All public sector organisations have a responsibility to ensure that expectation is met and Defence is determined to play a full part in this".
