Archived decisions

Contact: Jon Pittam ([email protected]) 01962 847400, ext 200 7400

Jeff Pattison ([email protected]) 01962 847321, ext 200 7321

Jos Creese ([email protected]) 01962 847436, ext 200 7436

1. Purpose of the Report

1.1 The purpose of this report is to review the work currently being undertaken by external consultants on the Contact Centre Programme and to set out proposals for re-letting this work to bring the current phase of the programme to a close.

1.2 It recommends that external consultants are appointed to support the second phase of Hantsdirect as originally planned, but that further market testing is undertaken to demonstrate value for money. The outcome of the market testing should be available at the decision day, but will not be completed in time for despatch with this report.

1.3 The report also describes how the handover to internal staff will take place to remove the reliance on external consultants in the longer run.

2. Recommendation

That approval be given to:

(a) Appoint four external consultants, for a period of up to six months until July 2008, based on the procurement and market testing approach set out in this report with the recommendations of the selection process being put forward for consideration at the meeting.

(b) Implement the handover plan to internal resources by July 2008, and earlier if possible.

(c) Note that the procedure adopted is in full compliance with European Union and County Council contract procurement rules.

(d) Note that the District Auditor has endorsed the procedure adopted, as at Appendix B.

3. Background

3.1 The original plans for the Contact Centre programme identified the need for external specialists with specific skills and experience in the design and implementation of complex multi-service local authority Contact Centres. This course of action has proved its worth with the successful launch of the project.

3.2 The present consultants were recruited through some market testing but Standing Orders and procurement rules were not fully complied with. This irregularity, when spotted, was quickly escalated and resolved. It is essential that new contracts on this programme demonstrate thorough and effective market testing, and that legal and financial procedures have been followed. Openness is essential as is the demonstration of value for money.

3.3 The Hantsdirect programme continues to deliver to plan and within budget, despite being one of the most complex change programmes that the County Council has embarked upon. The current phase of the programme (Phase 2) is the implementation of Adult and Children's Services with Hantsdirect, representing the most difficult and high risk area of the programme. Success will depend on having the right skills and experience in the team to manage the risks associated with the changes being implemented.

3.4 There are three areas where external expertise is still required by the programme:

· Programme management;

· Technical consultancy - in particular the configuration of the Lagan customer relationship management computer software to support Adult and Children's Services processes;

· Other specialists supporting the implementation of the programme alongside internal team members, (business change and operational set-up).

3.5 At the same time a key part of the plan is to ensure the completion of knowledge transfer between external specialists and internal teams to enable the County Council to become self-sufficient in the ongoing development and operation of the Contact Centre. This is described in the report.

4. Current Position

4.1 Formal reviews of the performance of the programme overall have been reported to the Programme Board, and the performance of the external programme manager has been reported to the Programme Chairman. Both have been viewed positively. The programme is currently on target to deliver within the budget set by the Corporate Management Team and Cabinet. The most difficult part of the programme is now underway, increasing risks, but success to date is a creditable achievement of the programme team.

4.2 There are currently four external consultants working on the project whose assignments are currently committed to the programme to the end of January 2008. It has always been intended to have break points to reassess developing needs and to tailor on-going external resources to those needs. Timescales for Phase 2 of the Hantsdirect programme have now been agreed and will run to the end of July 2008.

4.3 Market testing has been carried out for further consultancy (Section 6 below) and a plan for handover to internal staff agreed (Section 9 below). The aim is to have a clear exit strategy and avoid dependence on external consultants in the future.

5. Options for Team Resourcing:

5.1 To complete the next phase of the programme (Phase 2), there are two main options for team resourcing:

· Replace all external consultants at the end of January 2008 with internal staff. Whilst this would, in theory, be feasible, it would be highly undesirable in terms of risk to successful delivery of Phase 2 of the Contact Centre programme and would represent a change to the original intention to retain external experience through this phase.

· Appoint external consultants as proposed in this report, on the basis that:

o this demonstrates clear value for money through market testing;

o there is an effective handover plan from dependence on external consultants;

o there is effective management of risks for the programme and to public services provided through the Contact Centre;

o financial and legal processes are in place and have been followed.

5.2 Entering into new commitments with external consultants is the recommended option, following the original intention of the programme, and as agreed in principle by the Programme Board at its meeting on the 29 November 2007.

6. Market Testing and Value for Money

6.1 Whilst some market testing had been undertaken when the first contracts were placed, in proposing new contracts, further and more comprehensive market testing has been undertaken in conjunction with Legal Services and County Supplies working with IT Services on behalf of the Hantsdirect Programme Board.

Approach to Market Testing

6.2 There are two procurement routes which provide the basis for competitive comparison which comply with European Union and the County Council's own procurement regulations within the programme timescales:

· The Council's contract for the supply of temporary workers with Manpower;

· The Catalist frameworks offered by OGCbuying solutions (OGCbs).

(OGC is Office of Government Commerce)

6.3 The Manpower Framework contract has been subject to a full European Union (EU) compliant tendering regime. West Sussex County Council obtain IT staff through this contract and it is widely used by Hampshire County Council for temporary and other agency staff.

6.4 OGCbs Catalist offers a set of pre-tendered public sector framework contracts set up by Central Government. These are described in OGCbs information as best-practice procurement with all suppliers having been subject to a rigorous procurement process.

6.5 Manpower have been given explicit instructions to seek the widest possible list of candidates to match against detailed role specifications for the Contact Centre programme. This includes approaching suitable vendors on their books as well as other specialist agencies that the County Council has nominated (subject to such organisation(s) being willing to supply to the Council through Manpower). Candidates supplied by Manpower, either directly or through these specialist agencies, are being interviewed by a selection panel comprising County Supplies, a Programme Board member and senior managers in IT Services and Finance.

6.6 In addition to the Manpower route, supplier entries within the OGC Catalist catalogue have been reviewed to see if additional suppliers can be identified. At the very least, this provides additional benchmarking information, and it will be possible, following a mini competition, to place an order through the catalogue if the costs and quality of the individuals available through Manpower do not meet our requirements. The review of frameworks and pre-qualified suppliers in the OGC Catalist catalogue has identified an appropriate framework (multi-disciplinary consultancy), and this has revealed that the current rates charged by external consultants on the programme compare favourably with all of the catalogue suppliers in this category.

6.7 Proposed Actions and Timescale

· County Supplies asked Manpower to present candidates by 17 January 2008 for each of the four roles with a strong emphasis on providing effective competition (selection process week commencing 21 January, appointment week commencing 28 January, commencement 1 February);

· IT Services have nominated suppliers of temporary IT/project management staff that they believe could contribute effectively to the process to Manpower (completed on Monday 7 January);

· IT Services have reviewed the Catalist frameworks to obtain relevant benchmarking information and sought to identify a best value for money supplier for comparison against candidates provided by Manpower (completed on Monday 7 January);

· Selection criteria will be based on expertise and experience (and therefore quality), availability and cost.

6.8 As can be seen from this timetable, it has not been possible to include the results from the selection exercise in this report. These will be available towards the end of the week preceding the Executive Members' Decision Day on Monday 28 January 2008. Accordingly a confidential appendix will be produced and presented at the Executive Members' Decision Day giving a full analysis of the results of the selection process and preferred tenderers.

7. Finance

7.1 Regular financial reports have been presented to the Programme Board demonstrating that the programme remains within the budget set at the commencement of the programme.

7.2 Budget provision was made for contract renewals as proposed in this report and no new funding would be required. Appendix A summarises the current financial position on the programme, agreed with the County Treasurer. Currently £437,300 is uncommitted including £341,300 of the sum allowed for transitional costs. Assuming that the transitional funding is not needed for transitional costs (such costs were not incurred in phase 1) some of this sum could be used to fund the new contracts proposed in this report after provision has been made for other likely costs, internal staff working on the programme and a contingency to cover unforeseen events.

8. Legal and Procurement

8.1 The Monitoring Officer has been closely involved in the approach proposed, given previous issues. The Monitoring Officer is of the opinion that the approach proposed, through the use of the County Council's Manpower Framework Contract, or as a fall back by ordering through the OGC Catalist catalogue, is in line with both the European Union procurement rules and the County Council's own Contract Standing Orders.

8.2 The Monitoring office has also sent an early draft of the report to the Council's District Auditor, Kate Handy. (Appendix B.) She has commented as follows:

"I have considered the Councils proposals for the market testing and appointment of external consultants to the end of the second phase of the Contact Centre Programme as set out in this report. I am satisfied, on the basis of the information before me, that these arrangements, as proposed, follow due process."

9. Plans for Handing Over from External Consultants to Internal Staff

9.1 Work is already underway in the handover from external consultants to internal staff:

· The Contact Centre internal Operations Team is now in place and will be fully up to speed to support the Contact Centre by the end of July 2008. Training, coaching and knowledge transfer from external consultants and suppliers is progressing according to plan;

· The IT Services department will lead on any IT development work beyond the 31 July 2008 including the final stages of Lagan and Swift integration (the main systems involved for Adult Services), and IT support to the Contact Centre is already in place and operating successfully;

· Ongoing recruitment and training for Contact Centre staff is already being successfully managed by the internal HR support team;

· An interim Contact Centre manager has been appointed to lead on the interface between the Hantsdirect service and the departments which depend on it;

· Internal Programme Management has already commenced and will take the lead on the programme by March 2008, working alongside the external Programme Manager to effect a smooth handover. It is expected that external resource will run down before the end of July 2008.

9.2 Over the next 3-6 months, the handover to internal staff from external consultancy will be completed as follows:

· Business Solutions within IT Services will provide a programme manager to initially work alongside the existing external consultant. They will jointly produce a plan that will enable the internal staff member to take the overall lead for the programme as soon as is practical.

· Business Solutions will also identify internal staff to take the lead in Business Transition and in the Planning, Transition and Operational Set-Up roles that are currently being undertaken by external consultants. This will also be planned to ensure that adequate skills transfer and handover activities are managed effectively. The County Treasurer's Consultancy Team will assist this process.

· Lagan Configuration expertise will also need to be secured to take over from the current external consultants. This is likely to require both training of existing internal staff and some recruitment activity, both of which will commence in the near future.

9.3 Additionally, responsibility for programme management is in the process of being transferred from the Business Improvement & Corporate IT Manager responsible for conceptual development to the Business Solutions Manager in IT Services, reflecting the move to operational management. The Business Solutions Manager will manage the external consultants and phase-out their involvement as quickly as possible without risking significant delays or disruption to the project, and within the remaining budget available for external and internal resources. The Programme Board will continue to monitor progress and the Director of Children's Services will take over as Chairman in January 2008.

10. Risk Assessment

10.1 The programme is currently in the most challenging phase, as Adult and Children's Services are implemented with the Contact Centre operation. It is essential that risks to public services in this area are well managed. In this respect, evaluation criteria have been set for the market testing activity, which recognise cost and quality issues, including relevant experience and confidence that the project can be completed within an appropriate timescale.

10.2 There are, of course, the normal risks associated with any procurement of this nature in terms of the prices offered and the quality of the individuals, and in this instance, Manpower's ability to source candidates either from their own vendor panel or other specialist agencies.

11. Conclusions

11.1 This report concludes that the preferred approach is to appoint external consultants for the Hantsdirect programme to the end of Phase 2 of the programme (up to the end July 2008). This is in line with original plans and will minimise risks to services during completion of the next phase of the Hantsdirect programme.

11.2 The proposals for new contractual commitments are based on having demonstrated value for money through market testing.

11.3 The proposals have been endorsed by Legal Services, Internal Audit and Corporate Finance as being rigorous and robust as well as adhering to all corporate procedures, including Financial Regulations and Standing Orders on Contracts. The approach to procurement has been led by County Supplies and endorsed by the District Auditor.

11.4 The report also describes the hand over plans to remove the reliance on external consultancy to enable the County Council to become self-sufficient in the operation and further development of Hantsdirect.

Section 100 D - Local Government Act 1972 - background documents

The following documents discuss facts or matters on which this report, or an important part of it, is based and have been relied upon to a material extent in the preparation of this report.

NB: the list excludes:

1. Published works

2. Documents which disclose exempt or confidential information as defined in the Act.

None.

Appendix A

Financial Position of the project

Main Project Budget	£
Main project	4,863,000
Provision for transitional costs	750,000
Total	5,613,000

Original budget set - December 2005

Current financial forecast as at January 2008 to the end of 2007/08

	2005/06	2006/07	2007/08	Total
	£	£	£	£
Costs incurred - main project	22,300	1,639,000	2,222,000	3,883,300
Commitments - main project	-	-	885,000	885,000
	22,300	1,639,000	3,107,000	4,768,300
Costs incurred - transition commitments	-	261,800	64,000	325,800
Commitments - transition			81,600	81,600
	-	261,800	145,600	407,400
Grand total	22,300	1,900,800	3,252,600	5,175,700

This leaves £437,000 uncommitted. This is broken down as £341,300 of the transitional costs and £96,000 that is provisionally allocated to be spent on the programme team.

Appendix B