Tinkering around the edges of outdated business models will never produce the efficiencies currently required from all parts of the public sector, says Neil Malpas
A new era of frugality will only add to the pressure on public sector organisations to improve performance and deliver even greater value for money.
Many bodies in the public sector, however, are hugely inefficient because of the business models they use, in terms of where they allocate resources and how they deploy staff.
Changing the way existing processes work can have a dramatic impact on both performance and the bottom line. One example of this is Doncaster Prison. Most prison models work around the various stages a prisoner encounters – pre-screening, entry, care in prison, leave and ultimately the probation system – but these aren't what really impact on the individual. It's the other things – the separation from their partner or children, being distanced from the job market and having nowhere to live on release – that make reoffending more likely.
By looking at things from a personal perspective and introducing projects to provide prisoners with accommodation on release and a "Lads and Dads" programme to maintain contact with their children in the meantime, Doncaster Prison has been able to ensure prisoners retain links to the real world, resulting in a lower rate of reoffending and making significant savings for the taxpayer.
Another example is a police force that had a problem with incidents such as car thefts or bag- snatching, which can have a huge impact in terms of people's perception of policing in the local area. By reallocating people with specific skills to the parts of the police process that took the most time and effort, the force was able to achieve a significant reduction in "volume crime" figures.
But simply juggling the existing setup will only result in a tiny percentage improvement. To multiply that, bodies need to look at things from a new perspective. Any organisation can do that if they have people – perhaps managers within different departments – who have been there and done it before. But there should be no sacred cows – everything must be up for review.
Managers need to take a bit of time looking at what has been done in the past to try to improve processes. But often in the public sector there is a strong desire to avoid projects "not invented here" and this lack of ownership needs to be suspended. Take the time to look more broadly across similar areas and departments and other public-sector organisations. Set aside some time for some creative thinking, if only to establish that there really isn't another way to do it.
Sometimes an external partner is needed to provide that kind of sideways view. We were recently asked to look at a public sector organisation that had 26 locations across the UK and ran a fairly straightforward process. The business itself was also asked to provide its own analysis. Its cost-efficiency programme revolved around closing two offices because two towns contained two sites. We came back with one location across the UK and a completely different setup. Turkeys are never likely to vote for Christmas but it also shows the value of having been through similar projects in the past and having a fresh approach.
Such an analysis should also include an evaluation of outsourcing. Some elements of an organisation's operations have to be kept in-house and those can then be subject to more traditional efficiency programmes – cutting costs but also implementing measures to improve people and the support they get to do their jobs. Other processes can be best provided by external providers; in which case it's about looking at the scope of any project and the levels of risk transfer. But that can only be done if organisations have already evaluated the business processes through experienced eyes.
Using a partner organisation can also create a greater degree of flexibility in projects that remain in-house, but this will only work if there's a genuine relationship based on visibility. If everyone only sees their own bit they will never be able to help respond to client requests or spot potential problems in the future.
Another area where effective business modelling can have a real impact is project rescue. Often the trend here is to flood the project with extra people, but that simply hides the issue for another two years. Where projects are going wrong – rather than just having the wrong programme director or a poorly skilled team – a complete redesign is usually required, looking again at how things are being done and the overall structure of the project. Again, it's looking sideways at what's not working rather than simply trying to fix the broken parts.
The next few years offer an unparalleled opportunity for public sector bodies to improve efficiency. But that will only be possible if they're prepared to challenge the way things have always been done.