Monday, 22 June 2015

The risk of dysfunction Procurement Strategy

The revelation today that changes to Home Office immigration rules will mean the need for many overseas recruited nurses to return home reminds of us the need to have a holistic approach to risk management when developing policy and strategy.  It is only a short time ago that a small fortune, £20.19m,  was invested in overseas recruitment as a means of addressing nursing shortages. Now, having made that investment, the HO changes mean that investment was only a short-term 'band-aid'. It didn't solve the problem. Did the original business case recognise the wider dependencies?

From a procurement perspective, we have to see this pending crisis in parallel with the DH  'clamping down' on Agency spend. I have already questioned that strategy, but that was in the absence of knowing about the HO plan which would generate additional shortages. Did the DH lack awareness too of the HO plans when they announced the 'get tough' on Agencies strategy? Did the HO think through the dependency on overseas workers? Did the HO and DH speak to each other - did they even understand the need to risk access their strategies?

Now the DH go into negotiations with Agencies in an even weaker position. The can't train sufficient nurses within the HO 2017 guillotine and demand will only increase, and they can't make sure that the anticipated nursing shortages can be addressed through Agencies or temporary staff. It will take some very creative thinking to achieve a good outcome.

While it's easy to see the flaws in central government strategy, the lessons to procurement practitioners are clear:  don't embark on a strategy prior to doing your research and understanding what else is being considered in the organisation; have a clear articulation of dependencies; risk assess your strategy; and, avoid placing yourself in a position or weakness in the market.

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