City of Westminster: Driving innovation and efficiency through effective procurement
Since Anthony Oliver’s appointment in 2012, the procurement team at Westminster City Council has strengthened its systems and operating model, making the organisation more commercial, driving greater innovation whilst maintaining strong governance and enabling effective decision making. The council has achieved the CIPS Corporate Certification Standard, issued by The Chartered Institute of Procurement & Supply, of which Oliver explains, “This recognises what we’ve achieved to date, but we’re now able to build upon that with our 2016 Procurement Programme and move it into 2017. I really think that gives the council a true competitive edge over what other authorities are doing.”
The recent CIPS recognition reflects the council’s continued focus on people development, market development, our operating model and technology development, as well as acknowledging that there are effective policies and processes in place with regards to best practice and management of risk, providing efficient innovation and change management.
Procurement Services provides a centralised category management approach that supports and enables the services in Westminster City Council. The team consists of Category Management which provides leadership, commercial insight and sourcing assurance to the stakeholders throughout the council, and Procurement Development that provides the procurement systems, policy and training and takes the lead in the strategic and day to day developments of the Procurement team. The team addresses spend of c. £450million per annum on goods, services and works, with a supply base of around 6,000 suppliers. The council’s primary role is to ensure that what they procure provides value for money (VFM) and meets the functional needs of the Council. Through strong relationship management, Westminster Council ensures that their suppliers deliver high standards of performance, as well as continuous improvement and innovation within the VFM framework.
Effective procurement is fundamental in supporting the delivery of the Council’s vision of a City for All – an unrivalled city of aspiration, choice and heritage, where the connections amongst residents, businesses and visitors get stronger as everyone plays their part in and benefits from the city’s continued success. City for All underpins Procurement Service’s business plan and the council’s Category Management and Development objectives and activities are fully aligned to the City for All commitments. Oliver explained that Westminster City Council has sought to work in collaboration with several partners on the significant development and renovation works in the north of the borough, ensuring all procurement strategies are aligned with the council’s ‘City for All’ vision, incorporating Aspiration, Choice and Heritage, whilst focussing on all aspects of social value and sustainability with their Responsible Procurement approach to all procurement projects.
With the aim to retain the existing communities, whilst also developing areas of the borough, the council works to enable families to stay in their homes, gain affordable rent and return back to work. Oliver explains, “Often when councils redevelop, they move everybody out to put some new buildings up, and everybody who goes back in comes from somewhere else. We want to retain the community that exists in the north of Westminster in the Church Street ward area.”
Six new schemes supporting the City for All vision will enable the procurement team to deliver quality outcomes. One of the most significant will be employment and the creation of opportunities for residents to gain essential skills within the workplace. This can be provided through apprenticeships and work experience, in addition to investment in advice centres to support individuals to return to work. This in turn creates a domino effect with regards to the other areas of focus: economic independence, quality of life, resilient communities, world-class environment and clean air. Oliver explains, “If, through our procurements and with our suppliers’ help, we can get more people back into work, it creates a knock-on effect, because once you’ve got people back into work, the impact that has on a family creates aspirations. We want our residents to have aspirations and have those choices, but it really starts to have an impact on a family once we’re able to make those differences.”
Sustainability has become an important focus, and there is a procurement lead at the council who ensures that all procurement activity is aligned with the council’s social policy vision. This vision also extends to enabling families to make informed health choices. “Whether we are building or helping with employment outreach or helping with some of our public health procurement activities – we actually see the outcomes and that’s what leads back to a city of aspiration because we are creating those aspirations,” comments Oliver. With significant investment for a new technical college, Milton University Technical College, in addition to a £26 million investment for a sports leisure centre and a £2 million community centre at the Jubilee Site, the council aims to give local communities the best possible support.
The Category Management team works with customers across the organisation and also collaborate on pan-London procurements with other London Boroughs and the Clinical Care Groups. Category Managers support customers in City Management and Communities, Planning, Public Health, Corporate Services, Housing Regeneration, General Construction and Property. To enhance the value that our team creates Category Managers will often co-locate to work in the same areas as the services that they are supporting.
Procurement Services, working in collaboration with the Council’s key Services, are driving innovation within their procurements. For example, rather than adopting the traditional parking enforcement approach, the council has adopted the use of marshals, who ensure that drivers park safely can find a street where parking spaces are available and pay the appropriate fee. To support this further, the council has invested in parking sensor technology as part of its procurement strategy, enabling staff to view parking spaces and direct drivers to a street with ample space. Members of the public are also able to download an app created by the council in order to find a suitable space. However, Oliver explains, “This is all about trying to help people through our parking solutions – however, we do still issue parking tickets and we have a back-office service that is outsourced to NSL that delivers a very efficient service in terms of process and transactions.”
To ensure the delivery of key services, the council currently outsources a number of contracts, such as Agilisys for distributed computing and service desk. BT currently holds the council’s managed services contract, in addition to back office finance services (processing of invoices), alongside its data centres and essential HR services, as part of several frameworks. “Outsourcing our back-office functions is providing great efficiency to the council, but also, importantly, these procurements are helping to deliver against our medium-term plan to bridge the funding gap that all local authorities are facing in these times of reduced funding from central government.” Oliver says. “While we take an approach that helps to deliver in excess of a £1 million worth of savings to Westminster, it is a framework that is open to 32 other London boroughs to also call off and gain efficiencies.”
Category managers in the Procurement Services team in Westminster ensure consistent positive working relationships with key stakeholders and customers, identifying key stakeholders and their roles within procurement projects, whether they are the owner of the budget, main decision maker, representative of finance, legal or any other vital position. Whilst the council adheres to current EU procurement rules, the Procurement Services team always aims to engage with the market as early as possible, as part of the category management process, in order to understand how the market can support the delivery of current services.
Collaboration and communication is vital with all procurement projects, as Oliver explains, “I would very much describe it as a partnership. It is about relationships, understanding what the customer wants and supplying the expert advice that we can provide as category experts, whether that’s category & market knowledge, or best practice policy and process, such as EU procurement regulations or some of the policies around what we do on social value and also how we use technology to the best affect when we go to market.”
The organisation has invested significantly in the use of various technologies in order to remain innovative and consistent. The use of capitalEsourcing, the council’s eProcurement platform – a framework that the council awarded to BravoSolution in 2014 and that Westminster has configured and rebranded to make it work for local government – has streamlined the management of all procurement and contract activity. The framework was open to 22 other London authorities, of which seven are currently using the technology. The system is the tool for all procurement activity providing an end-to-end e-sourcing suite that gives full visibility of 3rd party contracts. This has allowed the procurement team to look at opportunities for aggregation, drive savings out of existing contracts and provide more effective reporting of contract performance. Oliver sees capitalEsourcing as “developed by local government for local government.” It was successfully used for the procurement of the Tri-borough contract for ICT provision which was awarded to BT and Agilisys, but, says Oliver, because it “standardises” the way Tri-borough councils do business and “simplifies the engagement process”, it is also useful in encouraging local businesses to tender, particularly SMEs, who have warmed to the online system. Oliver concludes, “To complete the picture, we are now in the process of linking capitalEsourcing into our back office and service facilities with BT.”
New ways of working have also been a key facet of a number of strategies including People, Digital Engagement and Asset Management Strategies. The Council has sought to create an environment that delivers more collaboration, collective responsibility and productivity as part of our cost reduction proposals.
The council is aiming at extending its operations and procurement services through the creation of Westminster Procurement Services Ltd, a trading arm for Westminster, with the aim to become more commercial and offer consultancy expertise to other public sector organisations. A recent joint venture with niche procurement consultancy firm, shortly to be made public, will ensure the organisation is able to leverage its substantial capability in the delivery of procurements and best practice, in order to sell into other public sector organisations, giving the council a competitive edge.
The Council has strengthened its strategic commissioning and procurement capabilities. This is a key enabler of their strategic vision and has delivered more than £10m towards the 2016/17 savings target. The council has undergone significant financial pressures, with a gap of £100 million to close within two years, in addition to a further £100 million gap which needs closing. To this effect, the organisation has streamlined operations and looked closer at the services delivered, alongside a reduced workforce to see how they can be delivered to residents in a more effective way. The current procurement supporting the refurbishment of City Hall, an investment that will in time, deliver substantial savings, will ensure an improved workplace and consistent service approach. The council is also keen to invest in its employees with a leadership programme named the Westminster Way, supporting the organisation to remain efficient and provide resilience.
Westminster Council has built efficient and effective ways of working to support the running of procurement, with well-informed outcomes and increased savings. Oliver explains that it is important “to manage change better, because it is significant – the change that we’re driving”. The organisation has become a beacon council for what they are doing in procurement, with other councils wishing to discuss how they have implemented category management, best practice, strong governance and become more commercial, driving innovation and efficiency.
Oliver says, “Our team are engaged, we’ve developed our own category management approach, we’re embedded with the service departments and we have strong stakeholder engagement.” However, the council is still on a journey, but wishes to become the best within local government, and is on the road to success as it continues on that journey.