Preparing for Alternative Service Delivery

Alternative Service

Delivery

Jon WalkerVice President Client Programs & Services SAFEbuilt

Making Decisions for change in a highly

complex and volatile world in which citizens demand engagement

and transparency while also wanting quick,

effective results

• Motivations for Change

• What the Public Wants

• Factors to Consider

Today’s Goal:Preparing for Public Discussion

“…citizens deserve the best possible quality of government services. Government must ensure that those services are produced in an effective, fair and affordable manner.”

Stephen Goldsmithwww.governing.comProfessor of government at the Harvard Kennedy School, former Mayor of Indianapolis and Deputy Mayor for Operations for New York City.

“events, threats and opportunities aren’t just coming at us faster or with less predictability; they are converging and influencing each other to create entirely unique situations.”

2010 Global IBM CEO Study

Public Service Management was much different in my grandfather’s world.

Heck, it is a lot different from the world this guy operated in.

“…whether any given service should actually be accomplished by a government employee, a contractor or a combination of both depends on the service itself and the relative capabilities of the private and public sectors in that realm.”

Stephen Goldsmithwww.governing.com

Think of 2 services your organization offers: • one with which you are proud of or you

have recently made improvements, and• one about which you have recently heard

someone express questions or concerns.

Write the name of the service.

Write down the desired community result/ public good that the service should achieve.

Service Delivery Activity

11

Motivation

12

MOTIVATION TO CHANGESERVICE DELIVERY

Politics

Kremic, T., Tukel, O. and Rom, W. (2006).

Strategy Cost

Kremic, T., Tukel, O. and Rom, W. (2006).

• Actions of other organizations• Get rid of problem functions• Reduce political scrutiny• Better accountability/management

POLITICALMOTIVATION

COSTMOTIVATION

1) Third-party management, 2) establishing an authority, 3) operation by the department itself.

Columbus Ledger-Enquirer (2/13/13)

OPERATING COST SAVINGS: COLUMBUS GAThe Council selected a private pool management company to operate the city's new natatorium. Their three options were:

Both the authority and city options presented projected deficits of over $900,000 while the third-party option annual deficit was $187,710.

OPERATING COST SAVINGS: COLUMBUS GA

Columbus Ledger-Enquirer (2/13/13)

STRATEGYMOTIVATION

Kremic, T., Tukel, O. and Rom, W. (2006).

STRATEGYMOTIVATION• Quality Improvement• Greater flexibility, speed,

technology• Human Resources: Skills

&Workload• Increase focus on core competence• Increase control on critical function

Chris Lagerbloom, City Manager

• Automatic Aid & co-located equipment

• SWAT teams• E911 System• Sworn Officers

STRATEGYMILTON & ALPHARETTA

Start by discussing motivations

How do we talk about change?

When dealing with people, remember you are not dealing with creatures of logic, but creatures of emotion.

Dale Carnegie

How can I clearly communicate the issues that are motivating my

decisions?

WHAT DOES THE PUBLICWANT?

If you wish to persuade me,

you must think my thoughts,

feel my feelings,

and speak my words.

Cicero

A positive sense of accountability, focusing more on outcomes: ensuring people’s priorities are reflected and they get what they need.

What do people want, need and expect from public services?2020 Public Services Trust at the RSA

ACCOUNTABILITY

When discussing public services with members of the public, perhaps the strongest theme that emerges is a near-universal concern that they should be ‘fair’

What do people want, need and expect from public services?2020 Public Services Trust at the RSA

FAIRNESS

What do people want, need and expect from public services?2020 Public Services Trust at the RSA

Underlying concerns about fairness in service provision:Self-interest (services should be fair to me/my family), and Altruism (services should act as a safety net to prevent certain groups from falling behind the rest of society).

FAIRNESS

What do people want, need and expect from public services?2020 Public Services Trust at the RSA

Alongside the key concern that services should be fair, the public also emphasizes the importance of services being high quality and delivered effectively.

QUALITY

Delivery (30%)• The final outcome• The way the service

kept its promises

• The way the service handled any problems

What do people want, need and expect from public services?2020 Public Services Trust at the RSA

Drivers of ServiceSATISFACTION

Timeliness (24%)• Initial wait• How long it takes overall

• Number of times had to contact the service

What do people want, need and expect from public services?2020 Public Services Trust at the RSA

Drivers of ServiceSATISFACTION

Information (18%)• Accuracy• Comprehensiveness

• Being kept informed about progress

What do people want, need and expect from public services?2020 Public Services Trust at the RSA

Drivers of ServiceSATISFACTION

Professionalism (16%)• Competent staff• Being treated fairly

• Reliability

What do people want, need and expect from public services?2020 Public Services Trust at the RSA

Drivers of ServiceSATISFACTION

Staff Attitude (12%)• Polite and friendly staff• How sympathetic staff

were to the clients needs

What do people want, need and expect from public services?2020 Public Services Trust at the RSA

Drivers of ServiceSATISFACTION

How do the services you

listed compare?

•Understand Desired Community Results (Accountability)

•Clearly defined Service (Fairness)

•Agreement on Indicators to Measure Results (Quality)

How do we talk about change?

Government measure: number of work requests; miles resurfaced; potholes filled

Public measure: smoothness score; number of major jolts encountered per mile; quality of repair; need to repair again after a short time

Involving the Public in Measuring and Reporting Local Government Performance, Barbara Berman, National Civic Review, Sp. 2008

Real Indicators

• This is what you asked for. (How do we know)

• This is what we delivered. (How do they know)• This is how well we delivered it. (How do we agree)

WE HAVE TO BE ABLE TO TELL THE PUBLIC:

Making the

Change

VISION WITHOUT ACTION IS A DAYDREAM.

ACTION WITHOUTVISION IS A NIGHTMARE.

JAPANESE PROVERB

Environment

Strategy

Service Complexity

Cost

Factors to

Consider

Factor to Consider

Environment

What are the current external forces creating stress and

instability for services in local government?

Environmental Scan

ECONOMICCHANGES

Americans are more concerned about the

economy than they are about anything else.

Gallup Poll – July 2013

Percent Job Losses in Post World War II Recessions

http://www.calculatedriskblog.com

Civilian Employment/Population

Source: http://research.stlouisfed.org/fred2/graph/?id=EMRATIO Retrieved 08/18/2013

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310%

15%

20%

25%

30%

35%

40%

45%

50%

% of Unemployed by Length of Time

15 - 26 Weeks 27+ Weeks

Source: U.S. Bureau of Labor Statistics | Division of Labor Force Statistics, www.bls.gov Retrieved 8/17/2013

Pew Research Center – April 2013

Families with a net worth

below $500,000 on average

lost 10% of the value of

nonfinancial assets from

2009 to 2011.(Homes, Cars, Business, Properties)

• Declining tax base

• Infrastructure costs

• Employee-related costs

• Cuts in state & federal aid

City Fiscal Conditions in 2012

National League of CitiesSeptember 2012

Source: http://research.stlouisfed.org Retrieved 08/03/2013

All Employees – Local Government

Includes persons 16 years of age and older residing in the 50 states and the District of Columbia, who are not inmates of institutions (e.g., penal and mental facilities, homes for the aged), and who are not on active duty in the Armed Forces.

DemographicCHANGES

55

56

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

1960 1970 1980 1990 2000 2010

Under 20

20 - 29

30 - 39

40 - 49

50 - 59

60 - 64

65 - 74

75+

Population by age range 1960 - 2010

57

58

59

Social Media

The heightened role of the media and social activism have combined to create

greater demand for accountability and

transparency.

Public Sector Research Centre – PriceWaterhouseCooper

The road ahead for public service delivery

“It’s so effective we’re putting together teams of people just to focus on Facebook and Twitter.It helps spread the message like wildfire.”

John Staver, chairman of the Transportation Leadership Coalition and a former Tea Party activist.

Atlanta Journal Constitution (6/5/13) – “Activists enjoy public’s embrace of social media”

• Legal Factors / Compliance• Internal Management & Stakeholders• Stability/Uncertainty• Political Pressure – Citizen Demands

Kremic, T., Tukel, O. and Rom, W. (2006).

Environmental Issues specific to your organization

How have the changes mentioned impacted services?

How has the service changed since 2000? 2008?

How has the community responded?

Factor to Consider

Service Complexity

• Complexity

• Integration

• Asset/Skill Specialization

• Structure/Predictability

• Organizational Impact

Kremic, T., Tukel, O. and Rom, W. (2006).

FUNCTIONALCHARACTERISTICS

Factor to Consider

Cost

Capital Cost Elimination

Operating Cost Savings

Cash Flow Management

Kremic, T., Tukel, O. and Rom, W. (2006).

Purchasing Power

Internal Systems (i.e. HR)

InnovationCompetitionOwnership

OPERATING COST SAVINGS: where does it come from?

CASHMANAGEMENT

Under Resourced

Under Resourced

Over Staffed

In 2010 Troy Michigan’s Comprehensive Annual Financial Report reported a cumulative shortfall of $6.6 million in the building services department.

CASH MANAGEMENT:TROY, MI

Troy’s officials made the decision to privatize its building inspections department with SAFEbuilt.

CASH MANAGEMENT:TROY, MI

TROY MICHIGAN’SRESULTS$1 Million savings in first year

Documented performance improvement

Increased community engagement

Factor to Consider

Strategy

Rightsourcing

RegionalShared

Services

Outsourced Contracts

Public Staff

Selecting the service delivery method which provides the best value, quality and accountability to meet the needs of your community.

Unclear Expectations

Workload Flexibility

Desire In-house Expertise

Critical Information

Core Competency

Public Staff Benefits

Shared servicesLEVERAGING REGIONAL RELATIONSHIPS

• Mutual needs and priorities

• Reduces liabilities

• Creates economies of scale

• Improves communication and coordination

Shared Services Benefits

Contract

OtherAgencies

PrivateCompany

SHARED SERVICES SUCCESS FACTORS

• 1976 – Regional leaders seek water

study and shared approach

• 1987 – Regional Water Study

completed

• 1994 – Authority created by Georgia

General Assembly

UPPER OCONEE BASINWATER AUTHORITY

• 1998 – Corps of Engineers Issue

Permit

• 2002 – Reservoir Completed

• 2008 – Jackson County sues

Authority for yield calculation

UPPER OCONEE BASINWATER AUTHORITY

What I learned:• You’re in a long-term relationship

with mutual assets• Stress in one area can create

stress in other services• Political change has an impact

UPPER OCONEE BASINWATER AUTHORITY

•Access to a Specialized Workforce

•Clear Expectations•Asset Specificity•Flexibility

Outsourcing Benefits

COMMUNITYENGAGEMENT

Before Vendor Engagement

comesCitizen Engagement

What do people want, need and expect from public services

2020 Public Services Trust at the RSA

• decisions shaping public services

• deciding spending priorities. • service design and delivery.

58% of the Public wants to be more actively involved in:

48%of American adults directly took part in a civic group

or activity in 2012

Pew Research Center – Civic Engagement in the Digital Age, April 2013

39%spoke out or contacted a

government official offline

Pew Research Center – Civic Engagement in the Digital Age, April 2013

34%did that online

“Trust-based relationships are the only scaffolding that can effectively manage the increased complexity ahead.”

2010 Global IBM CEO Study

Confidence in Congress Falls to Record Low

http://www.gallup.com/poll/163052/americans-confidence-congress-falls-lowest-record.aspx

June 13, 2013

Retrieved 7/28/2013

POLLS SHOW LEADERSHAVE WORK CUT OUTFOR TRUST ISSUES

Atlanta Journal Constitution (10/10/12)

“We don’t trust you, and we won’t pay to fix some of our region’s biggest problems until we do.”

• government wastes “a lot” of money;

• “not many” or “hardly any” of the people running the government are honest;

• public officials don’t care much what people like them think.

60% OF RESPONDENTS BELIEVED

Atlanta Journal Constitution (10/10/12)

Gallup

Public Trust & ConfidenceIN LOCAL GOVERNMENT

74%great deal or fair amount

“WITH PUBLIC SENTIMENT

BEHIND YOU ANYTHING IS POSSIBLE.

WITHOUT IT, NOTHING IS POSSIBLE.”

- ABRAHAM LINCOLN -

THANKYOU

JON WALKERjwalker@safebuilt.com

• Bureau of Labor Statistics www.bls.gov

• Dept. of Commerce Bureau of Economic Analysis www.bea.gov

• Federal Reserve Economic Data http://research.stlouisfed.org/fred2/

• Gallup Poll www.galllup.com/home.aspx

• Pew Research Center www.pewresearch.org

• Calculated Risk www.calculatedriskblog.com

SOURCES FOR DATA

Kremic, T., Tukel, O. and Rom, W. (2006). Outsourcing Decision Support: A Survey of Benefits, Risks, And Decision Factors. Retrieved 2/11/2013 from http://ankara.lti.cs.cmu.edu/11780/sites/default/files/Outsourcing-Survey.pdf

2020 Public Services Trust (2010) What do people want, need and expect from public services? Retrieved 2/12/2013 from http://www.ipsos-mori.com/researchpublications/publications/publication.aspx?oItemId=1345

Capitalizing on Complexity: Insights from the Global Chief Executive Officer Study (2010) IBM http://public.dhe.ibm.com/common/ssi/ecm/en/gbe03297usen/GBE03297USEN.PDF

RESOURCES

Goldsmith, S. (2009) Outsourcing, Insourcing, Rightsourcing, Retrieved 2/11/2013 from http://www.governing.com/blogs/bfc/Outsourcing-Insourcing-Services.html Kavanagh, S., Johnson, J, and Fabian, C. (2011) Anatomy of a Priority- Driven Budget Process, Retrieved 2/7/2013 from http://www.gfoa.org/downloads/GFOA_AnatomyPriorityDrivenBudgetProcess.pdf

Association of Government Accountants (2010) Content Guidelines for the Citizen-Centric Report’ Retrieved 3/8/2013 from http://www.agacgfm.org/AGA/ToolsResources/CCR/ContentGuidelines.pdf

RESOURCES

Berman, B. (2008) Involving the Public in Measuring and Reporting Local Government Performance, Retrieved 3/3/2013 fromhttp://www.fcny.org/fcny/cgp/ReportsandPublications/national_civic_review/#national_civic_review

Civic Engagement in the Digital Age (April 2013), Retrieved 8/17/2013 from http://pewinternet.org/Reports/2013/Civic-Engagement.aspx

Office of the Auditor General, British Columbia. (2010) Guide for Developing Relevant Key Performance Indicators for Public Sector Reporting, Retrieved 2/21/2013 from http://www.sidit-bc.ca/documents/OAGBC_Trust%20Report_Final.pdf

RESOURCES

National League of Cities: City Fiscal Conditions in 2012, Retrieved 8/17/2013 fromhttp://www.nlc.org/find-city-solutions/city-solutions-and-applied-research/finance/city-fiscal-conditions-in-2012

The road ahead for public service delivery, Public Sector Research Centre – PriceWaterhouseCooper http://www.pwc.com/en_GX/gx/psrc/pdf/the_road_ahead_for_public_service_delivery.pdf

Johnson, R.W., Chingos, M. and Whitehurst G. (2013) ARE PUBLIC PENSIONS KEEPING UP WITH THE TIMES? Retrieved 8/11/2013 from http://www.brookings.edu/research/reports/2013/06/12-public-pensions-johnson-chingos-whitehurst

RESOURCES

Alliance for Innovation: Community Engagement http://transformgov.org/en/Article/102997/How_to_Promote_Citizen_Engagement

Association of Government Accountants: Perspectives on Performance www.agacgfm.org/Research---Publications/Perspectives-on-Performance.aspx

RESOURCES – Citizen Engagement

Political PressureCitizen

Demands

Internal Stakeholders

Stability/ Uncertaint

y

Legal Factors

Functional Characteristics

Complexity Integration

Asset/Skill Specificity

Structure/ Predictabilit

y

Organizational Impact

Core Function/

Competence

FlexibilityQuality

Critical Function/ Control

Human Resources:Skills/Workload

Cost Savings

Strategy

SERVICEGoal/Desired Result Cost

Capital Expense

Cash Flow Managemen

t

Environment