Tales of the unexpected, Harmeston & procurement leadership lessons

I do not recall when the professional credibility of a CPO has received as much attention as that of Kath Karmeston (for example,  The Guardian, FT,  and The Times).  Harmeston already had a significant profile, largely through the reputation she gained as Royal Mail's CPO, before moving to the Co-op.  At the Co-op she became responsible for cutting the costs of the >£1bn spent on 'goods not for resale', and The Times claims she was paid £357k a year for that!

However, after a remarkably short stay, say ten weeks, Harmeston and the Co-op parted company. Harmeston decided to pursue a claim of £5.2m for unfair dismissal (I've no idea how that figure was calculated and some would say it was an unachievable negotiating position). Whether intended or not, Harmeston brought the spotlight on herself through the decision to go to the tribunal. You can read the Co-operatives version of the Tribunal here.  Now after almost two months of waiting for an answer, it is reported she has failed in her claim against the Co-op for unfair dismissal.

I am not competent to comment on the legal aspects, and feel a slight discomfort intruding on private grief, but I can have an opinion on some of the alleged practice reported in press - let's remember this blogpost is based on reported evidence and some of the evidence was contested.  Much of evidence struck me as irrelevant to the unfair dismissal case but relevant to the profession and those who would hope to bring about procurement change - it's those areas I discuss below.

We are told Harmeston believed she had uncovered a lack of procurement policy compliance; 70% of the budget. Understanding the extent of non-complaint spend is certainly a good starting position for improvement - understanding 'why' and what to do about it would be an even better position. The CEO though claimed the issues raised by Kath were already known about and Kath had previously been briefed on them. It is always dangerous to claim the glory for uncovering something when others say you didn't - that applies just as much to claiming savings in isolation of the budget-holder's contribution. 

Nevertheless, when the Co-op's head of group risk probed Kath, he concluded that the CPO didn't know the details of the procurement policy. Now given that she was only in post ten weeks, it could be argued that was understandable. What strikes me as unacceptable though was his assertion:

Policy process and governance she defaulted to [her deputy] because she felt it was beneath her. 

Anyway, that was made worse by, Paula Keegan, the former group chief strategy officer's opinion that Harmeston knowingly chose to break the Co-op's procurement policy herself.

I cannot think of any situation when procurement governance should not be a primary concern when seeking to bring about procurement change, indeed even setting the example of compliance.

Perhaps you can already sense the loneliness of the CPO's journey. To me, when you want to bring about procurement change you also need a coalition of allies - the CEO, head of group risk and group chief strategy officer would be useful allies but Kath failed to gain their ownership.

Nevertheless,

Up on Cloud 9 with the Reform report '(Back to) the Future of public procurement'

I wearily plodded through Reform's report 'Cloud 9: The future of public procurement'. To be honest I think the highlight for me was making me think why on earth Estonia and South Korea were identified as exemplary benchmarks. I was about to compare the respective structures of devolved government and range of responsibilities and what they buy with that of the UK, and even the baseline from which their savings were achieved. Thankfully I stopped.

Sadly, the Reform report really doesn't tell us anything we didn't already know, and have known for at least 20 years.  Yes, we have heard over and over again that skills need to be improved, the benefits of embracing eProcurement, the need for better use of procurement data, a better attitude towards risk, etc, etc.. I could see nothing new there I'm afraid.

Indeed if we go back to the evidence given three years ago, by the then chief honchos of Government Procurement, to the Public Administration Select Committee (you can see an example of my posts at that time here) the mantra used in that evidence was that all these panacea were "Work in Progress".

What the Reform report doesn't tell us, which may help, is how did Estonia and South Korea bring about the change, assuming they did, which seems so illusive to the reform of UK public procurement. Do they hold individuals accountable for the bringing about change as opposed to just accepting "It's a work in progress"?

It would certainly be interesting to hear how the Reform report is viewed by the PASC and whether it acts as a catalyst to review progress since their 2013 inquiry.

In the firing line for buying bendy rifles?

If this were the 1st April I would have thought what follows was an April Fool, but since it is early March we will have to take reports that the Paris police have bought guns which don't shoot straight at face value.

We are led to believe the German army had concerns about Heckler & Koch G36 assault rifles and their unreliable aim in temperatures over 23C - supposedly 50cm off target at a range of 200m when the temperature is 30C!  As a result, the German army has embarked upon a replacement plan over the next three years.

However, the French appear to have been unaware of, or ignored, the German concerns and have just bought 204 of the same rifles as a part of a €17m investment. To make matters worse, it is also said that the French have insufficient shooting ranges where the rifles can be used.

So, some obvious questions:

1. Were the rifles purchased by brand or performance specification? A performance specification may provide the French with some reassurance?
2. Is a high degree of accuracy actually required by the French? If not, well perhaps the lack of accuracy isn't an issue unless you're an innocent bystander of course.
3. Were the rifles bought without considering the potential range of temperatures in which a high-degree of accuracy would be required? It certainly looks as though a warm day in Paris may cause problems and heaven only knows what the consequences of the searing temperatures of Syria would be.
4. Did the French reduce their exposure to risk by discussing their needs with other users to learn from their experience? If they were aware of the German concerns perhaps they were able to negotiate a particularly good deal to offset the lack of function.
5. Have the French reduced their risk of a product not fit for purpose by testing a representative sample in the full range of possible scenarios of usage? Maybe the test will provide an opportunity to escape from the deal.
6. Did the French consider the additional requirements of practice ranges when committing the purchase? Sometimes buyers forget the additional costs incurred in the pursuit of lowest price.

Seems a pity that what appears to have been a rushed procurement with good intentions may be a case of flawed procurement - a faux pas.

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!

Impact of 'no procurement boycotts' Guidance Note?

The UK Government has now published the much anticipated and trumpeted guidance on procurement boycotts. Yes, it's one of those documents all public bodies will now have to risk access.  Time will tell whether it will also be cascaded to those 3rd sector organisations who receive public money, say through Lottery funding?

It's a Policy Guidance Note, so you may well find yourself asking your legal advisors: "what if I decide to ignore the Guidance?" or, getting into the detail, "Does this only apply 'above the threshold'?" - actually I understood that the Principles of the EU applied regardless of the threshold anyway.

Of course all these initiatives are dependent on whether those who view themselves as being 'victims' have the appetite to pursue a case through the courts.  Surely, anyone who has considered themselves wrongfully discriminated against in a procurement process during the boycotts up to now would have already taken a case - nothing has changed as this is only Guidance.

Regardless of all that, it may have been interesting to establish what the actual impact of the boycotts to date have been, for example, has a procurement decision actually been different in terms of its award outcome? If there was no change in a real life procurement decisions, then the boycotts could only have had 'political impact' in raising awareness of the issues - something which the anticipation and implementation of the new Guidance has paradoxically probably been more effective in doing.

Anyway, here's the key statement from the Guidance for anyone who has a interest in political procurement:

Public procurement should never be used as a tool to boycott tenders from suppliers based in other countries, except where formal legal sanctions, embargoes and restrictions have been put in place by the UK Government. There are wider national and international consequences from imposing such local level boycotts. They can damage integration and community cohesion within the United Kingdom, hinder Britain’s export trade, and harm foreign relations to the detriment of Britain’s economic and international security. As highlighted earlier, it can also be unlawful and lead to severe penalties against the contracting authority and the Government. 

I suppose you could also interpret this loosely as: "Public procurement can be used as a tool to boycott tenders from suppliers based in other countries if the UK Government decides it wants to, but that choice cannot be devolved to any lower level of government".  

CIPS Cyber Security for Procurement Professionals - a useful eLearning tool.

I have just become aware that CIPS released a free eLearning course 'Cyber Security for Procurement Professionals'  which was developed with the UK Government.

There are six modules and it is available free of charge regardless of whether or not you are a CIPS member.  The suggested time for completing the eLearning is 75' but you will need longer if you follow the various links.

To me the real value is in Module 3; the others are pretty generic cyber security awareness raising, while Model 3 provides really useful specific advice on what the procurement professional should do, for example, including the need for certifications in bids.  I think it also implies the need to give some thought to the implications of cyber security within S2P processes.

On the downside, there is some infuriating background music - turn it off. The 'Knowledge Check' questions are the end of each module are so basic they are of questionable value. Disappointingly, I found when I followed some of the early document links I ended up having to completely restart the tool as opposed to picking up where I left off.

Nevertheless, I think this is a useful CIPS offer and would recommend it be included as a 'must do annually'.  I wonder why it is not behind CIPS member only firewall?

Junior Doctors, the EU Referendum and procurement change management lessons

I honestly don't know who is right in the current NHS change management crisis with the Junior Doctors. Imposing the new contracts can only be viewed as a failure but it is also a symptom of the bigger failure of change management or mis-management. I suppose there are questions as to whether imposing contracts is even legal; like many of you, I have been the victim of having changed employment and pension contracts imposed on me - that did not make me feel good. There is of course no doubt that the NHS is in a crisis and the resolution of the Junior Doctors issue will set a precedent for future negotiations way beyond those with the Junior Doctors.

There is also a precedent for the current chaos - remember the communications debacle relating to care.data. The system was to improve service but the communications management was lousy.

The reason why I do not know whether Hunt or the Junior Doctors are right is very similar to the care.data debacle - the NHS communications setting out the current 'As-Is' and the future 'To-Be' has been abysmal. Those 'anti-change' have usefully played on emotion and fear. They have also managed to successfully infiltrate almost every one of the discussions on BBC Question Time for some weeks - the equivalent of the Greek Agora, the Roman Forum, and the works' canteen - the dessenters voice is very definitely the clearest and the loudest.  I ask myself why the NHS have not set out, in very simplistic terms, their case for change, perhaps on a webpage, a full page advertorial, or even a televised debate - that also needs to debunk the supposed myths of the BMA.  If that happened I could make an informed decision. If they really wanted to be aggressive they could also 'un-deify' the Junior Doctors - easy enough if you started to discuss the various NHS failures and how they could be linked to the problems the new contracts will overcome.

Of course the NHS' 'Junior Doctors' communications fiasco are only a warm-up for the EU debate - we can expect emotion and fear to dominate. We can expect communications to be poor - they already are.

So what about lessons for procurement? Well, if you want to bring about procurement change, the Junior Doctors crisis may serve as a useful warning:

1. Make clear, again, and again, and again, what the benefits of the 'To-Be' and how they address the problems of the 'As-Is';
2. Understand the negotiating power of those involved;
3. Understand the fears of those who will and could be impacted;
4. Address head-on the criticisms of the dessenters - some of their concerns will be justified, some will be nonsense, and some just scaremongering;
5. Remember that new systems and processes are not inanimate, they are concerned with people and it is people who will determine the effectiveness of the outcome;
6. Bring people with you, including those right on the periphery.