workshop c : profitable partnerships in tough times mike britch, norse group managing director
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Workshop C : Profitable Partnerships in tough times Mike Britch, Norse Group Managing Director. “LAs must consider fundamental changes to the way in which services are provided.”. - PowerPoint PPT PresentationTRANSCRIPT
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Workshop C: Profitable Partnerships in tough times
Mike Britch, Norse Group Managing Director
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“LAs must consider fundamental changes to the way in which services are provided.”“Partnership working between Councils and other local agencies is key to re-designing public services and to ensuring good outcomes at lowest cost.”Department for Communities and Local Government
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Partnership“An agreement in which parties agree to co-operate to advance their mutual interests.”
Contract“An agreement entered into by two or more parties, each of whom intends to create one or more legal obligations between them.”
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Partnership versus Contract Contract
High reward/high risk Requires detailed
specification Can drive win/lose
behaviours Certainty of outcome but
change can be expensive
Partnership Lower risk/reward Flexibility Influence Speed
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Profitable partnerships? Public/Private partnerships• Requirement for full OJEU process
Public/Public partnerships• Use of Teckal exemption
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Common objectives Valuing each other’s contribution Knowing what success looks like The partnership being greater
than the sum of its parts
Ingredients for a successful partnership
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Freedom to: Trade Innovate Generate profit Do things differently Experiment/get things
wrong Be successful!
Ingredients for a successful partnership
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What can partnership offer? Financial return over and above initial
savings Vehicle for service transformation Flexibility Operational freedom:• expand skill base• capacity• commercial culture
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To combine public service ethos with commercial andentrepreneurial skills Commercial and dynamic leadership Cultural change by staff
• Career opportunities• Business focus• Client centric
Robust monitoring and reporting systems Built around service specifications and KPIs
Profitable partnerships need . . .
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Accountability and personal ownership Commercial systems
• HR• Finance• ICT
Sales Function Awareness of importance of cash flow
Profitable partnerships need . . .
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Formed in 2002 Grew out of DSO/DLO and set up in response to CCT Staff transferred to company NCC single Shareholder Board of Directors to ensure NCC strategic control 2002: Turnover = £47m 2012-13: Turnover = £250m
The Norse Group
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The Norse Group Joint Venture Model Separate joint venture companies limited by shares – 19 in place
already Board of Directors• 2 senior Partner Authority nominated• 3 Norse Group
Shareholding split 80% Norse – 20% Partnering Authority Profits split 50-50 Norse Group takes commercial risk Equal Shareholder rights Shared vision and objectives
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Via its partnerships, the Group has: responded to market failure• Care Homes• Affordable Housing• Contract failures – Connaught
created new opportunities• Energy management – CRC• Waste disposal
changed with the market• Free Schools• Academies
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Driving value from partnership Doing the same things via a different
vehicle will not deliver a step change or profitability
Use the partnership to change the outcome in service delivery and client commissioning
Success can only come from growth. Service efficiencies will only go so far