Supplier Relationship Management of Providers of Contracted Employment Provision

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Supplier Relationship Management of Providers of
Contracted Employment Provision
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Who are we?

• Toni Percival Head of Supplier Management.
  Commercial Employment Provision Commercial
  Directorate DWP
• Steve Marsland Commercial Director A4E
• Stuart Knowles Executive Director of Employment
  Shaw Trust

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What is Supplier Relationship Management (SRM)?
A tiered approach to supplier relationships
whereby suppliers are managed at an appropriate
level, dependent upon their criticality to DWP,
to provide balance, control and informed insight
in complex relationships where there is some
degree of interdependency. The two parties work
towards the integration of their businesses,
where that integration will bring mutual benefit
for the buyer and supplier.
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SRM is a structured approach to merging two worlds
Relationship and culture
Corporate strategy and structure
Strategic supplier
Customer
Change initiative management
Governance and infrastructure
Governance and infrastructure
Capability and capacity planning
Market sector and supply chain
Stakeholder / relationship management
Stakeholder / relationship management
Financial strengths and structures
Commercial and legal arrangements
Commercial and legal arrangements
Current and future project involvement
Performance measurement and management
Integration of two businesses
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Objectives of SRM

• Improve commercial relationships with providers
  by focusing on common objectives using clear
  measurement metrics
• Understand better the factors affecting success
  throughout the whole supply chain and across
  contractual and geographical boundaries against a
  clear definition of expectations
• Develop better ways of working and doing business
  together for mutual advantage
• Motivate providers to improve performance across
  the range of their Contracted Employment
  Provision business
•  

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Working closely with our providers, SRM can
deliver mutual benefits including

• Improved performance
• Improved communications more open relationships
  and trust
• Reductions in duplication and bureaucracy
  re-engineered processes
• Opportunities to collaborate in the setting of
  joint business objectives
• Ongoing development of staff and more job
  satisfaction
• Cost reduction and better value for money

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More benefits.

• Joint innovation and focus on continuous
  improvement
• Better focus on customer service
• Clear and well understood performance standards
  and measures
• Greater understanding of and development of the
  market
• Better identification and management of risk and
  contingency arrangements.

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Managing the provider base
Some providers span multiple OPUs, District
Offices and are classified strategic in nature
nationally, and we will need to manage the
relationship further at a pan- DWP level.
Capability Capacity Financial analysis Pan-DWP
performance Challenge policy Governance top
cover Overarching commercial structures and
benefits management
Supplier Relationship Management
Some providers span few OPUs, Districts and are
classified non strategic nationally but still
very important. We need to manage the provider
relationship pan contract but at OPU Lead
Centre owned relationship Top cover, Strategic
issues
Cascade goals and objectives
aggregate performance, escalate
1st/2nd/3rd tier provider development Overhead
cost reduction Outsourcing Asset management Lean
supply chain Etc.
Provider Management
Provider Management
aggregate performance, escalate
Some providers span few OPUs, Districts and are
classified non strategic nationally but still
very important. We need to manage the provider
relationship pan contract but at OPU Lead
OPU Lead on Relationship Development activities
OPU Lead on Relationship Development activities
Cascade goals and objectives
District level relationship
District level relationship
contract
contract
contract
contract
contract
PIs
PIs
PIs
PIs
PIs
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How SRM fits with contract performance
management
Embedding SRM Within DWP
Commentary eg highlights lowlights
key initiatives
Supplier Relationship Management(SRM)
MI metrics and measures
Contract Management Processes
Contract Management
Performance Management and Reporting
Performance Management
Performance Measurement
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Background to our SRM Project

• Jobcentre Plus Organisational Design Review
• less staff and formation of Operational
  Procurement Units
• Highlighted the need to move from a highly
  fragmented approach to one where we work more
  closely and strategically with our key providers
  to raise performance and get better value for
  money. Recognised we needed a step change in
  the way we engage with our larger providers to
  make a real difference to performance.Set up a
  Supplier Relationship Management team within DWP
  Commercial Employment Provision (formerly
  Jobcentre Plus Procurement Division)Decided to
  pilot our approach initially on a small scale.
  Ensure activity added value before committing to
  doing more

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Stages of a typical SRM implementation
9. Evaluate
Identify User Needs
Manage Supplier Relations
SRM
3 Engage with Suppliers Launch joint SRM team
Agree Strategy
Data Gathering
7 Plan and Launch Strategy
4 Gather Detailed Data
Conduct Relevant Analysis
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Stages of our SRM Pilot

• Analysis of the provider base
• Decide which providers to focus on
• Develop Team Implementation Plans
• Engage with providers and run launch workshops
• Develop joint strategy, objectives options
• Gather detailed data
• Set up run cross organisation, multi functional
  strand groups
• Set up and run Steering Groups
• Implementation
• Evaluation
• Report recommendations

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Criteria for Provider Classification
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Pilot Providers

• Classification formed basis for selection of two
  Providers for Pilot Phase
• Both are large providers delivering across most
  regions and whose delivery makes a significant
  contribution to the achievement of DWP and JCP
  business objectives. There are other major
  providers who came close and we will be looking
  at expanding this initiative to them.

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The journey so far.

• Working with and involving a wide range of
  stakeholders in each organisation.
• Held Launch workshops set up Steering Groups
• Developed agreed SRM objectives that align
  with DWP objectives and long term strategy
• Agreed Strands to take forward specific areas of
  work joint teams in each strand who are working
  on a variety of areas

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The journey so far (cont)..

• Working together to gather information and
  identify areas for improvement
• Agreed shared values and ways of working
• Improved understanding of each others
  organisations and the issues they face

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A view from Shaw Trust

• Launch Workshop identified some key themes to
  address
• Policy, Strategy New programmes
• Processes Systems (re-engineering end to end
  business processes)
• Quality Performance and Contract Management
• Financial assessment and payment processes
• Joint work on Finance and policy with Shaw Trust
• Improved provider involvement in early stages of
  provision development

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A view from A4E

• Launch Workshop initially identified the
  following key themes
• Planning, Forecasting, Innovation and Flexibility
• Processes and Systems
• Contract Management and Performance
• Funding
• Priorities changed
• Work on communications and culture with A4e/JCP
• More open and constructive communications
  especially when dealing with issues.

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And what about our other providers?..

• The SRM team plan to raise awareness and share
  findings of the pilot with other providers.
• We are developing a plan of communications with
  providers and representative organisations eg.
  ALP, ERSA, BASE etc.
• We will be looking at areas where sharing the
  learning will be beneficial more widely
• We are looking at areas where we can work with
  wider groups of providers to address issues, eg.
  managing sub-contractors

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SRM Pilot Evaluation

• The aims of the evaluation are to make an
  objective assessment of the effectiveness of the
  implementation of SRM in Jobcentre Plus.
• Specifically to assess
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• the SRM implementation processes. To provide
  feedback on the approach and inform changes and
  continuous improvement of the implementation
  approach and process
• benchmark current working relationships between
  DWP and Providers and analyse any improvements in
  working relationships resulting from SRM.

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SRM Pilot Evaluation

• We will also seek to learn lessons from the
  pilot, in terms of planning, processes,
  communications, and stakeholder engagement.
• Specifically what went well and what lessons we
  can learn for the future. This will be used to
  inform future roll out of SRM more widely.
• Results will inform future improvements and
  enhancements to the SRM approach and will inform
  the future roll out of SRM more widely.

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What Next?

• Currently a dynamic and changing market place
• DWP Commercial function will be developing to
  meet changes to the market and the way we buy
  provision
• Bigger contracts mean a greater emphasis on good
  quality management of providers and delivery of
  provision
• We need to support our prime contractors
  effectively