Thursday, 13 March 2014

Are 21 Crown Representatives an indictment or a solution?

The 4 March announcement of an additional six Crown Representatives means the UK government are relying on a cohort of 21 part-timers to address, what the Financial Times refers to as, Whitehall's "insufficient civil servants with the commercial skills to [manage outsourcing contracts]".

Now let's be clear, outsourcing is not remotely new and there has been major outsourcing in the public sector for many years, but the most recent trend probably dates back to CCT of the 80s. So, let's  say the UK public sector has 25 years of outsourcing yet are not perceived to have developed sufficient skills! How can that be?

Right at the core of Gateway Reviews, PRINCE2 and MSP methodologies are questions relating to whether the client has the skills in place to effectively deliver the project/programme. So how on earth did so many of these 'problem' projects navigate the QA' system without demonstration of the required skills? Is this indicative of a deficiency in the systems as well as the people?

Bill Crothers, the Chief Procurement Officer, justifies the Crown Representatives by saying:
Our Crown Representatives are bringing in top business acumen into Whitehall - our procurement reforms saved £3.8 billion last year and we want to go even further.
The problem is that we just can't differentiate between the savings which are directly attributable to Crown Representatives and those which are attributable to the cohort of commercial senior civil servants. Having said that, I'm sure there are some senior civil servants going through the appraisal system at the present time, claiming that much of the savings the CPO cites are solely attributable to them.

Equally, we can't see the outsourcing experience of the Crown Representatives. Undeniably, they have illustrious pedigrees but are those pedigrees directly relevant to managing outsourcing contracts. Or to put it a slightly different way, had these posts been recruited in the traditional civil service manner, would the existing Crown Representatives satisfy the essential criteria? If the answer to that question is 'no', then the problem is not just the absence of commercial skills, ineffective QA project systems, but also ineffective recruitment processes.

Naturally we expect critics of outsourcing to scream that the services should not have been outsourced in the first place. But when you outsource a service not only do you work on the assumption that the new provider will be better able to deliver the service but that you are able to manage the provider. I don't think the public can tell at the present whether or not the 'problem' outsourced services would, even if they could, be better insourced? While it is easy to point the finger at the providers, surely the client should constantly have to demonstrate that 'buy' is still better for the taxpayer than 'make'. Where is the transparency? Why haven't the Crown Representatives been asked to review the basic make/buy options given their business acumen?

All the theory argues you should not outsource your core competencies, for example, the ability to manage strategic contracts. If you outsource your core competencies you have really thrown the baby out with the bathwater and you are at the mercy of the provider. You become dependent on a provider whose first loyalty is to their own firm as opposed to you as a client. Power has shifted from the buyer to the seller. You are dependent on them more than they are dependent on you. Are Crown Representatives a version of outsourcing the core competency of procurement?

Now let me pose some other questions:

  1. Are Crown Representatives a sustainable solution in the long-term?
  2. Is there any evidence that in the big bad world of the private sector, there is an equivalent of the Crown Representative? if not, why not?
  3. How are Crown Representatives accountable in the way in which civil servants are?
  4. Are Crown Representatives a short-term avoidance tactic rather than address the failures of people, systems, transparency and accountability? 
  5. We now have 21 Crown Representatives how many more are justified or required?
NB. First published on 6 March as a Spendmatters Guest Post Spendmatters

No comments:

Post a Comment