Gove turns his guns on procurement and programme management

One time thought to be a contender to become PM, former Secretary of State for Education, and Secretary of State for Justice has set his sights on public sector procurement and programme management professionals today, in a Comment piece in the Times. I will watch with interest the Letters section to see if CIPS reply.

Gove does a fine job of cataloguing procurement and programme management disasters. Indeed, many of the cases he cites are those I have blogged about in the past and/or used as case studies when training.  I will spare you an echoing of the cases; the average man or women on the street is familiar with many of them anyway.

While it is interesting that Gove has put pen to paper on a subject dear to many of us, what is particularly interesting is who he considers to blame - the 'Sir Humphrey's but not the Ministers.

Gove calls for a shift to weekly reporting on progress to Parliament of procurements and programmes. Would there be enough Parliamentary time and, if there was the time, would we see any interest from MPs?

Controversially he also wants to

see the names of civil servants responsible for these programmes to be published, their explanations for failure (or success) recorded and those who've failed be removed while those who can demonstrate clear, measurable, success get promoted. I know this concept- let's call it accountability - may be somewhat revolutionary for our civil service.

This is an interesting notion but isn't Gove missing the point about why we have Ministers in charge of government departments?  It is the democratically elected politicians who have to call those in their own departments to account.  It is the democratically elected politicians who have to rein in the pursuit of unrealistic political timescales.  It is the democratically elected politicians who have to develop the skills to scrutinise and manage professionals to ensure that they deliver on their objectives. Yes, perhaps civil servants need to use a louder voice in explaining to politicians the risks of pursuing some projects. But you can't just point the finger at the civil servants without recognising a failure of political performance management.

Also worrying is the implication that civil servants are being influenced by lobby groups. Can he really believe that, and if he does, why doesn't he blow the whistle on what really amounts to corruption.

This, one time, very influential political may well have lost a lot of his power, but should he ever regain it, CIPS will have a major problem if they don't educate the former Secretary of Education now.

  

For want of an archaeologist ...

I love it when I find a new example of a Bottleneck item - those purchases which are often comparatively low price but of critical importance.  Today's Times yielded one such example which I'm not sure many would have thought of: archaeologists!

UK politicians have made a lot of noise about the need for more housebuilding. In parallel, the HS2 is quite possibly the biggest, and most politically sensitive infrastructure project for some time, for example, it's 350 miles long - you can read more of my observations on its procurement here. The financial cost of each of these initiatives is enormous and logically delays will add to cost and have a negative impact on delivery of the business case.  Politicians accountable for delivery will understandably be a bit sensitive too.

However, before work can actually commence on site there is a requirement in the UK for an archaeological investigation.  The estimated demand for archaeologists means that an additional 25% of these 'Indiana Jones' types are required.

I'm sure you can see where this is going - what's the lead-time to get an archaeologist with the necessary skills trained, was the supply pipeline of archaeologists created in sufficient time, has enough attention been given to attract students to pursue archaeology, how much had been budgeted for the premium costs which may now need to be paid for this scarce resource, has the Home Office thought through the potential visa implications for non-EU citizens who may be required? You get the feel for the procurement, project and programme management risks?

Somebody tell me that this has all been previously risk assessed and mitigated. Do I sense an 'In The Thick of It' moment?  Perhaps. as they used to say of procurement, this is Archaeology's opportunity - but hopefully not at Procurement's expense.

Lessons for procurement change from the Common Agricultural Policy Delivery Programme

The Public Accounts Committee has just released its report on The Common Agriculture Policy Delivery Programme which could be the basis of an episode of 'The Thick of It' on change management. Indeed The Times uses the wonderful headline: "Civil servants' row with Mr Fancy Pants costs millions".

The report is short so you can quickly read it but some salient points are:

1. If you want a programme to be delivered successfully you need clarity, consistency and ownership of vision. Those supposedly driving this programme had competing objectives which hampered progress.
2. Make sure those bringing about the change and the leadership of the organisation to be changed can work together. 
3. Make sure the organisation is ready for the change. It appears the department concerned were neither ready nor adequately supported in the change.
4. Make sure the approach is pragmatic. A digital solution was being pursued even though the users lacked the skills and even the required broadband coverage.
5. Sometimes you need to go native. In this case the mistake was as basic as the change agent turning up in a very formalised setting dressed as if they could have been going to a beach party - the old saying 'clothes maketh the man' may sound trite but sometimes an unnecessary explicit culture clash can be perceived as arrogance and work against success.   

Let's remember that the failure in delivery cost money, £60m.

Are there any lessons for those seeking to bring about procurement change/improvement, yes, don't make the same mistakes!

'Cut the Cards: making SAP work' - Book review

At first glance you may wonder what relevance this book could have to you. Don't be put off by the title as it is not a book for SAP 'techies'; it is much more and I would view it as recommended reading for anyone on an MBA course or with an interest in PRINCE2. I suspect those who would benefit most though would be those designated as Sponsor of an ERP implementation and those charged with an oversight or scrutiny role.

Donnelly has produced an easily readable book on what could be a very dry subject and his black humor works very effectively. Having said that, assuming there is a second edition, I think the addition of section headings would be beneficial.

In a forensic analysis of public and private sector IT implementation disasters, Donnelly provides a diagnosis of what he believes really went wrong: cash-flow, poor leadership, self-serving partners, poor project management, poor risk management, and poor contract management are all there.  Key lessons for me are the need to modify SAPs standard processes as little as possible, so change management should be concerned with moving from the As-is to the correct SAP process, having the correct governance in place and use PRINCE2 methodology.

Also covered, although indirectly, is SAP's marketing strategy - a good case study in itself.

But what's there for a procurement practitioner? If there's an ERP project the CPO needs to have a seat at the table as part of the business case development, specifying, contract drafting, selection, risk management, change management and contract management. Then the CPO needs to be engaged with Blueprinting the To-Be - I have previously discussed how that should be an opportunity for procurement transformation, yet too often is missed through automating the existing, yes, that still happens!

Can the Major Projects Authority deliver?

The Financial Times reported this week that John Manzoni, head of the UK Major Projects Authority,  has now lost critical expertise due to outsourcing and now lags "five to eight years behind business". He also implies an absence of execution and delivery skills - that's not a big surprise as I have frequently discussed the gap between policy and implementation. A related article then talks about the scarcity of skills in Whitehall to deliver big programmes.

Let's be honest, the average man or woman in the street could have said that.

But the average man and woman in the street wouldn't be in a position to understand that there have already been many, many, many years investment in MSP and PRINCE2 training over the years. There have been no shortage of methodologies and training opportunities, either - reflect on the former Civil Service College prospectus.

While I support the notion of the Major Projects Authority, my prediction is that it will just join the plethora of other good but failed ideas.  Sadly, it too, will in all probability, fail in delivering the desired outcome. Why? Well quite simply, we don't need school lessons on why projects fail. We need  a breed of managers who are brave enough to say to politicians: "No - this isn't the best approach", "We're not ready yet",  "We haven't sufficient resources", etc..

The problem is that those good writing and negotiating policy are politicans echoing what Politicians want to hear - they are diplomats as opposed to change managers. Perhaps they see implementation as 'lower down the food chain". Rewards, in the form of promotions aren't for delivery, they are for political nous not the bravery to speak truth.

Can the Major Projects Authority itself deliver? I don't think you can change the DNA of those who have been groomed in risk aversion. Nevertheless, let's revisit this blog in five years time and see if I am wrong.

Strategic procurement programmes: Before and after

We're all familiar with the 'before and after' images which so often paint a picture that suggests 'after' is more attractive than 'before'. If only that were the case with strategic procurements.

After years of 'before' trumpeting the anticiapted aspirational success of the NHS National Programme for IT, a programme which appeared to be the offspring of political egotism, the first signs of faltering, and the cosmetics of a name change, now politicians want answers:

"There has to be a reckoning. We have to know how much money has been squandered and what could have been done instead."

"If the people letting the contract have made a catastrophic, gargantuan mistake then there is an opportunity cost. It is the taxpayer who has to fork out money for what should have been spent n services they need."

To me the NPfIT was clear who was leading and the governance structure to be used. But back in 2011 I asked what happened to the application of Gateway Reviews on the Programme. Of course MPs received NAO reports on the Programme's progress too - they were not ignorant of the risks.

So when the Public Accounts Committee and the Public Administration Select Committee sit down looking for answers, I hope they start by considering their own role in oversight - didn't they have a responsibility to the electorate? They could ask about political pressure that that was exerted and if civil servants 'pushed back'? They could then ask about who was getting paid for Programme leadership, where, when and why it went wrong? Then they could get the detailed findings of the Gateway Reviews? Then look at the risk register, how it was reviewed and when and what actions were taken? Then they could look at similar debacles, of which there are many, forget the political rhetoric and posturing? Finally they must ensure an environment exists which ensures there are very real penalties in place for those who should have blown the whistle on this and similar programmes yet didn't - did they lack the knowledge or the spine?

Unfortunately the 'after' looks fairly ugly for this Programme but perhaps the Beast could spawn some Beauty's for the future.

Not a good day for IT procurement strategy news

Not a good day for public procurement IT stories: two embarassing stories.  One looks like a procurement risk management and strategy issue linked with implementing a policy, regardless of understanding the risks; the second, concerns procurement project leadership credibility.


The Financial Times suggests the the Cabinet Office strategy of moving from big IT companies may have compromised effective delivery, in that the consortium of SMEs used as a preferred strategy may have stretched capability and led to service failures. 'Shambolic' is the term used!  While there are calls for delaying further rollout until lessons are learnt, is it not obvious that a phased rollout should have started with small departments should have been managed by the client with a watchful eye. Equally, while I can understand the sentiment of the policy, why on earth were ministers not aware of the risks, or were they?

The second story, this time in The Times, concerns the allocation of responsoibility for the Met's 'Total Technology' modernisation programme. It appears that one of those responsible for managing the programme brings with him unfortunate baggage of a past IT failure which cost £15m. While Grant Thornton found the oversight of the failed project in Surrey was 'not fit for purpose' it seems Rowley, who is now leading 'Total Technology', doesn't recognise that as relating to his leadership. Failure to recognise the need to learn lessons isn't a good place to be in - Mr Rowley and the Met need to understand what went wrong at Surrey and how those lessons will be applied in the future. As it is, Rowley's ability to gain the confidence of the programme team may already have compromised success. It is not a good omen.

So some key messages:

1. A policy needs to be risk assessed and then implementation managed;
2. If the decision is made to pursue a policy and strategy which is high risk it is best have a phased implementation starting with lower risk areas;
3. Where a project has failed due to leadership which is 'not fit for purpose' understand the reasons behind that statement, acknowledge the failure if necessary, and be clear how the lessons learnt with be applied;
4. Do expect a failed leader to deliver better leadership on a bigger programme without ensuring a strong governance structure is in place.

HS2 still needs to get all aboard

Only last week I applauded the publication of Making the Games - lessons learnt from the Olympics. Will we learn? Can we learn? 

Well we've now learnt of some of the early ingredients going into the mix for HS2 procurement and it does not strike me that we are looking at a recipe for success: 

• A lack of political agreement in any party let alone cross party agreement;
• Some politicians, even at this early stage, branding it an "enormous waste of money" while the Chancellor calls it "an engine for growth";
• An estimated cost increase of almost £2bn in the past year;
• The brief already beginning to change, including, the addition of a station at Manchester Airport;
• A lack of winning the hearts and minds of key stakeholders on economic benefits;
• Allegations of 'insider' knowledge which led to personal benefits while others lose;
• Projections based on a 67 year whole life cost - heaven only knows what changes will take in transportation in the next 20 years never mind the next 67?
• Legal challenges which have the potential to add years to the project.

Current projections are that the project should cost £34.5bn and be completed in 2034 - may be worth taking a note of that baseline figure and placing a bet on the actual figure and when the project will actually be signed off as completed.   

I remain completely agnostic as to whether or not HS2 is a good idea but have discussed before the need for accentuating the positive as part of a communications strategy, unfortunately the volume needs to be turned up and a bit more clarity on the business case. 

Although it is not too late to get the fundamentals in place, It doesn't look as if we've a good foundation for success yet. 

What we now need is some bravery in saying "get the basics right" otherwise we have a long slow journey ahead with little notion of the ETA or fare. 

An Olympic torch

Well hat's off to The Times CEO summit for aiming to identify the success factors behind the delivery of the Olympic Park.  I would have been more impressed had this been a government led review of lessons learnt, but nevertheless this is a start.

The key success factors identified by Sir keith Mills, deputy chairman London Olympic Organising Committee where:

"From the bid [process] to today, we had the right team in place and have demonstrated competency to complete what is an immensely complex project.  The Government had confidence that we knew what we were doing because we built confidence by delivering...  Buy into a vision, find the right people, give them the money and get on with it"

Fairly obvious lessons which you would expect.  Would you be surprised if a project or programme failed if it had the wrong team, lack of competency, lack of stakeholder confidence, the wrong team, and insufficient money?

'Letting them get on with it' causes me a little bit of a problem though - surely he also meant to say the right governance structure.

Now, can we progress from the strengths to the lessons learnt from the many things which didn't go according to plan, starting with the budget, ...


Background reading;
Hepwell, D. and Asthana, A. (2012) 'Ministers 'can learn from Olympic delivery success'', The Times, 12 June, p.13

   

You've got to accentuate the positive,

Eliminate the negative,

Latch on to the affirmative,

Don't mess with Mr In-Between. 

I tweeted recently to that effect: 'Student loans misunderstood, Health reforms misunderstood, DWP reforms misundertood: Dave and the Commotions, 'Please don't let me be misunderstood''.

Communication misunderstandings aren't unique to public policy reform, they are also a frequent procurement weakness; the procurement 'end' appears to be misunderstood.  An example was provided as recently as 2 March with the furore over the supposed 'police privatisation'. The only message which appeared to have been communicated was the 'negative'.  Why was there such a complete lack of confidence in the affirmative that the procurement could deliver a better outcome for citizens even though so much appears to have been contracted in the past? Highly respected procurement commentator, Peter Smith, even went so far as to refer to it as an example of 'stupid sourcing'  While I largely agree with Peter, in terms of a questionable sourcing strategy but the stupidest aspect is the associated communications strategy.

A lot of my blogs ask the simple question, 'Did the procurement deliver the anticipated results?'  I have argued that effective political leadership, scrutiny and use of 'fearless' gateway reviews all have a contribution to effective procurement outcomes - they certainly would have helped with the police procurement debacle.  But these are concerned with the procurement 'means' as opposed to the procurement 'end'.  The achievement of the outcome sometimes gets lost in the bureaucratic process or indeed in debating the process.

Yet I have also argued that suggesting some ends can be met when the process constrains that is also political folly.

Nevertheless, too many times investment just hasn't delivered what it was supposed to - that epitomises ineffective procurement;

Policing pitfalls of 'I see, I want, you buy ASAP'

I’ve decided to revisit the NAO report ‘Mobile Technology in Policing’. Previously I focused on the need for robust challenge and to avoid being bullied into bad procurements in pursuit of political expediency. Arresting as that discussion was, the report provides further lessons on how procurement and programme management effectiveness could be improved; let’s look at just three.

There were three objectives in the procuring the required Blackberry’s, etc.:

1.    Increase police officer visibility to the public;

2.    Reduce unnecessary bureaucracy; and

3.    Increase efficiency and effectiveness of the police service.

Had the objectives been uppermost in the minds of those leading the procurement there would have been a trail of evidence demonstrating the appraisal of alternative ways of achievement. The NAO couldn’t find that evidence.  Instead

Minister admits Public Procurement Litigation Agency overspend

Today the new Secretary of State responsible for procurement was questioned by the influential Public Administration Committee on why there had been a five fold increase in the costs associated with running the Public Procurement Litigation Agency.  She explained that a new industry had grown up on the back of the The Public Contracts (Amendment) Regulations 2009.  The Regs were introduced to implement the Remedies Directive (2007/66/EC) and according to the SoS have changed the dynamics within the public procurement market.  The Regs were the first justification for the overspend.

The SOS then reminded PAC that a former Cabinet Minister had publicly admitted a bias amongst the public procurement community against UK suppliers.  Independent academic research then revealed

A double helping of Christmas cheer and IT procurement woes

This morning I read Peter Smith's exclusive on a previously undisclosed undisclosed procurement capability review.   I gave a cheer for Freedom of Information.

I then picked up my paper at the local shop and read the wonderful headline 'Patients get right to see medical records online' and laughed.  I laughed for three reasons.

Firstly I have spend the best part of a year

Ministry of Justice finds IT Offender for Probation Services

When I last wrote about IT fiascos I referred to the need for political ownership and effective use of gateway reviews.  But IT procurement just seems to keep on giving lessons, if not unwarranted public monies to the IT wizards in the midst of an Austerity Strategy.

The latest debacle is found in the Probation Service's new £250m IT system for the whole of England and Wales.

Titanic lessons for programme and project management

Last week I discussed perceived problems relating to the Titanic Signature Building and the perceived funding shortfall related to the procurement approach.  Now more information has emerged which goes beyond procurement and provides lessons for programme and project management.  To me there some shortfalls in the areas uncovered.

Today the Northern Ireland Audit Office published its report on 'signature projects' which provides further insights into a portfolio of five projects (£159m), of which the Titanic Signature Building is only one.  Interestingly the review is published prior to completion of the projects, so it can only be hoped that there will be a further report.  There must also be a rationale for publication at this stage, presumably to collect lessons learnt.

Looking across the portfolio, delays and shortfall in delivery are attributed to deficiencies on overall project planning, management and governance arrangements, a shortage of funding, time-limited funding, match funding issues and inadequate programme and project level performance management.   One of the criticisms is that each project stood alone and project actions plans were developed independently and organically.  Those are useful lessons which I don't intend to argue with, but merely supplement.

It is surprising that it does not seem to been recognised that this was a 'Signature Programme' and should have been managed as such, completed with a Blueprint and what were standalone projects managed as a Dossier, or at the very least a Portfolio.  Indeed as opposed to the NIAO view that an 'over arching projects board' would have been helpful, what was needed was a Programme Board.  That Board then could have looked across all the projects and also considered the total economic impact as opposed to discrete project boards defending their own interests.

But were the individual projects well managed?  Well the NIAO conclude that even at the project level there were a lack of SMART objectives and consequently a lack of performance management.  Time, cost and quality in terms of project performance management aren't sufficiently addressed, so I'm not surprised that outcomes don't feature.  I'm reminded of an excellent paper on 'muddling through'.

Also amazing is that while the projects date back to 2004, funding was only identified in 2008. In the meantime funds were diverted from elsewhere - no questions appear to have been asked about the impact of that displacement of funding!  We find a wonderful recommendation "When public sector capital projects are approved for implementation, every effort should be made to ensure that funding is made available at the same time".  Why are MSP and PRINCE2 standard methodologies not just advocated?  Is it conceivable that Northern Ireland could have a collection of major capital projects started but then completion unaffordable?  

While discussing the NHS IT procurement fiasco recently, I highlighted the need for senior politicians to be closely involved in projects, fully appraised and potentially act as SROs - the NIAO haven't identified that as a problem, so that lesson may need to be learnt some time in the future.  Some projects seem to have SRO's while other don't - of course SRO's relate to programmes as opposed to projects. We now also have a new role, the 'Project Promoter' - to me this is a major flaw, SRO's like (Project) Executives, are accountable, responsible, ensure the funding is in place and act as champions, 'Project Promoters', who lack a role definition in the report, only appear to be champions without accountability.  So, from the public sector, who exactly is responsible/accountable for this major investment?

It seems no time since the spotlight was on the Millennium Dome and the VfM calculations relating to visitor footfall.  Therefore it would have been assumed those lessons would have been taken on board (excuse the pun) by those responsible for the Titanic Signature Building and exposed to a robust sensitivity analysis.  Sometimes projects just keep on giving the same lessons to be learnt for the future!

"When will they ever learn", when will we learn?"

The NHS IT system procurement fiasco or Gateway Review fiasco?

Yet again The Times has provided an exclusive on the on-going procurement saga of the NHS IT system.  Initially it was to cost £6.2bn now it's £11.4bn.  No one could deny this does indeed rank high in any challenge for 'procurement case study classics'.  Yet what lessons have we learnt? Before I start to answer that question, let's pick up on some of The Times story.

The Times report:

1. Health trusts were threatened with cuts unless they agreed to implement the system;
2. Civil servants had privately estimated that the software had a three-in-one chance of being delivered;
3. £250,000 was paid in bonuses to DH staff for exceptional contribution to delivery;
4. Applications installed had failed to function or put on ice;
5. The estimated cost of scrapping the system were estimated as zero if things went wrong, now it's billions;
6. The key provider's CX and Chairman quit with a golden handshake worth millions of pounds;
7. The NHS has pulled the plug on the system but the provider has allegedly boasted it expects a contract extension until 2017 and £2bn extra (we can add that to the potential saving from the Vaccine Purchasing strategy).

In 2007 I picked up on an earlier Times report on the procurement of the system - at that stage it was stated "[the system] is not working and is not going to work".

But I asked above what lessons can be learnt?

To me, although not identified by The Times, had a robust approach to Gateway Review been applied we would have been in a different position.   How have I arrived at that conclusion?

• Gateway 0  should have identified alternative ways of achieving the outcomes - from memory GPs had put forward alternatives, were they given due consideration?
• Gateway 1 Should have identified two risks, firstly, an unrealistic timetable, and secondly, the right people did not appear to be in place to ensure delivery.
• Gateway 2 should have asked at least five questions, none of which appear to have been robustly challenged: Are there suppliers who can deliver? Is the specification clear? How can we control risk, indeed what's the risk management strategy?  Is the procurement strategy appropriate? Have [GPs] been consulted?
• Gateway 3 should have tested the incentives to ensure good supplier performance.
• Gateway 4 would have provided reassurance that the business case was still valid and KPIs were being met.
• Gateway 5 awaits - I hope!

Of course there's a further question which, to me, isn't addressed in the review process 'what's the exit strategy?'  Compare that question with Tony Blair's initial 2002 question 'how fast can you get it/how long will it take?' The response was to accelerate the initial timeline - was that clever?

So, while we may look at this as an IT procurement fiasco, I really want to highlight that the real lesson to be learnt relates to how robustly we approach Gateway Reviews?  Were the Gateway Reviews robust?  Were they cosmetic? What did they uncover?  Were green lights given? If green lights weren't given why did the process continue?

Space doesn't permit a comparison against MSP and PRINCE2 methodologies but it's clear only lip service was paid those too!

Hindsight is a wonderful thing and that's how we collect lessons learnt (or should collect AND LEARN FROM).

My argument is that it is now timely to have an evaluation of the application of Gateway Reviews across the whole of the public sector and senior decision makers need to evaluate and learn from the application of Gateway Reviews in their own organisations.

To me gateway reviews, MSP and PRINCE2 methodologies are worthy of praise and adoption - they do not appear to be at fault.  Isn't it a pity that the appropriate application of the methodologies is sometimes lacking!

Each organisation should by now have had a root and branch review all their projects, challenged against by gateway reviews and particularly, how does this fit with austerity priorities and what's the exit strategy.

The Austerity Strategy needs to address these issues before reducing the delivery of services to citizens.  

Background reading and sources:

Kennedy, D., Smyth, C. and Pitel, L. (2011) 'Exclusive NHS computer fiasco still costing billions'. The Times, 8 December 2011, p. 1.

Kennedy, D. (2011) 'Software firm is banking on getting £2bn extra for its failed system', The Times,  8 December 2011, p.6.
Kennedy, D., and Frean, A. (2011) '$7m payoff for boss behind IT 'nightmare'', The Times, 8 December 2011, p. 8.
Robertson, D. 'We pay toll for road of good intentions', The Times, 8 December 2011, p.8. 

Rose, D. (2007) '£6,2bn IT scheme for NHS 'is not working and is not going to work', The Times, 13 February 2007.
Smyth, C. (2011) 'Project blighted from the start by bad decisions', in The Times, 8 December, 2011, pp.6-8.