Quarkside

14/02/2011

Governance Sandwich: The missing link

Filed under: Governance,Innovation,Local Government,Outcomes,Process,Technology — lenand @ 10:30 pm
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Entering the market for selling services to local government could not be tougher than now.  The cost per sale is high unless a supplier already has a large customer base to support the cash flow.  Levels of innovation from established suppliers are low, because innovation could have a negative impact on margins or income.  Competing successfully against an existing supplier, even an internal one, requires more than a glossy brochure.

In discussion with one such aspirational supplier, it was evident that they have the strategic, analytical, implementation and support skills.  Yet they felt that something was missing.  They do not have the traction they deserve. Internally they have reduced administration costs by 30% in one year – and sales performance and productivity has improved.  They have valuable lessons that should be transferable to local government.  But they can’t reach the Chief Executive level with a marketing message that carries any weight.

Chief Executives priorities are (or should be) methods of minimising administration and bureaucracy.  Heads of Service tend to protect their own fiefdoms and not promote radical changes. Sharing services with neighbouring boroughs could be a short cut to redundancy.  Heads of services are not going to be in listening mode for outsourcing ICT enabled innovation.  The energy for shared services has to come from a meeting of a small number of Chief Executives.  They need to envision that 30% reduction in bureaucratic overhead in their own budgets.

Their joint concern is ensuring that any shared service programme is within their statutory and regulatory vires – many of which may have been defined assuming they applied to a single authority.  We always hear that Chief Executives don’t want to go to gaol for breaking the law – but is it a credible risk?  Michael Gove apparently did something unlawful in closing down the BSF programme – but I don’t think he has had the police knocking on his door.

For shared services, imagine a sandwich with a top layer of partners’ desired outcomes on the top and a bottom layer of supporting technology on the bottom, operating across multiple agencies.  The filling is a single governance layer.  This is the realm of the Chief Executives.  Jointly they have to agree common governance processes.  Our supplier now understands the importance of engaging Chief Executives in their most important role – Governance.

Governance matters. You must have regard for the three fundamental domains:

  • Process: What is needed?
  • Governance: How is it controlled?
  • Technology: How is it to be done?
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