Collaboration in ICT – A presentation to the West Midlands

24th January 2014

Will Laing, Senior Relationship Manager – Local Government

Why collaborate at all?Information• £187bn public sector spend on good s and services – over 200,000 suppliers

• £40bn in CG: over 50% supplied by the Top 39 suppliers

• The £500m LG software market is dominated by 3 suppliers (70% share)

• A public sector organisation should be able to access knowledge on commercial engagements with suppliers from across the public sector – we need to end self-defeating “commercial confidentiality”

Capability• Leverage

• Specialist skills

• Shared services

• Improved supplier management and performance

• Driving innovation – internally and through supply chains

Efficiency• Lower costs of procurement

• Faster and more agile

• Better outcomes on price and quality

2 Commercial Reform

ObjectivesCrown Commercial Service to be operational• Revised Governance arrangements and senior management team

• Driving Service, Savings, and Reach (e.g. Managed Service rather than “just frameworks”)

• Covering both Central Government and Wider Public Sector

• Increase “true” Spend Under Management from approximately £1Bn towards the longer term goal of £10Bn+ (SUM stated today to be £11Bn)

• Advisory as well as a Direct Commercial service (Procurement and Contract Management)

Building Capability• Moving from approximately 600 staff today (450 GPS and 150 Efficiency Cluster) towards c1,000 by 2016/17

• Formal programme to develop the senior leadership to be a High Performing Team

• Formal recruitment hub established and showing results; significant recruitment activity

• Improved technology plan to be established and implemented

Common goods and services to be transferred• By end 2014/15, substantial spend will have been transferred

• Four trailblazer departments leading the way with spend and people transferred into CCS

3 Commercial Reform

Crown Commercial Service - reforming the commercial landscape

Retained departmental

commercial activities

Common but complex

transactions – joint working with

depts

Transfer of additional

commercial activities to CCS

CG & WPS Spend &

Procurements currently

transacted by CCS

4 Commercial Reform

Developing managed services and building world class commercial capability

Transferring operations to CCS - 4 trailblazer depts

circa £5bn of spend

Extending our involvement in complex commercial

activities e.g BPO

Strengthening functional leadership and improving

commercial capability

Influence and service

“We are creating a world leading organisation, providing fully managed end-to-end direct commercial and advisory service”

5 Commercial Reform

The new DNA for commercial activitiesBus

ines

s ne

ed

iden

tifica

tion

Suppl

ier r

elat

ions

hip

man

agem

ent a

nd

nego

tiatio

n

Execu

tion

of

sour

cing

stra

tegy

Mar

ket a

nalys

is

Sourc

ing

stra

tegy

Suppl

ier

iden

tifica

tion

Fina

lisat

ion

of

cont

ract

Contra

ct

man

agem

ent

£

Goal

High

Low

Time spent on value added activity

Before going to market

ProcurementProcess Contract and

supplier management

Managed Commercial Services delivered centrally - once on behalf of Government

UNCLASSIFIED

Developing requirements that

shape markets and the supply base to

Government

Improving contract and supplier management

capability through application of new

standards

Simplifying process and reducing

turnaround times & supplier bid costs

Av’ge turnaround times for EU procurements now less than 100 days (200 days in 2011)

Circa 20% of spend is now with SMEs (baseline 6% - direct spend only)

Before

Published pipelinesCross Government contract review

What CCS will expect from suppliers

Commercial Reform

To embrace competition

To be innovative through proposals

for how we can improve services

To be transparent through open book

accounting

To demonstrate high levels of

corporate responsibility

To deliver what we are asking for as

an intelligent client

To deal effectively with CCS as one customer - the

Crown

To make a reasonable but not

excessive profit

To provide opportunities to

SMEs in the supply chain

To deliver savings for taxpayers

6 Commercial Reform

Early examples of CCS in action

Commercial Reform

• Managed service provides access to a pool of 175 agile digital services suppliers (84% are SMEs and 38% are new suppliers to government).

Digital services Framework

• £2bn worth of energy procured and delivered across the public sector in 2012/13 with savings to the public purse in excess of £109m.

EnergyFacilities

management• New contracting model being

procured. Estimated savings over current model in the region of 10% to 15% (up to £350M) over the life of the vehicle (4 years).

G- Cloud

• 4th Generation contracting vehicle in place providing access to 1000 suppliers (84% are SMES). £64m of spend transacted through G-Cloud since inception in April 2012 via circa 4000 procurements.

• 63% of business by value has been won by SMEs.

7 Commercial Reform

8 Commercial Reform

ICT Category Management Governance Structure

London Procurement Strategy Board

London Connects

ICT Cat Mgt Project Board

Wireless Datacentres

Apps SRM eAuctions

Camden (Terry Brewer)

Newham (Geoff Connell)

Haringey (David Airey)

Camden (PMO)

Enfield (Tim Kidd)

Society of London Treasurers

GPS DeliveryTeam

The National Strategy

LGA National Procurement Strategy for Local Government• ICT one of three priority categories (construction and energy are the others)

• National category lead is Terry Brewer, Divisional Director, LB Harrow

• ICT leadership provided through SOCITM and the Local CIO Council

• A first iteration of the category strategy for ICT is with the LGA’s National Advisory Group for Procurement (NAG4LGP)

Key Themes• Local ownership and local leadership – each region can address its own priorities

• Technology opportunities – desktop alliance, data centre rationalisation, digital innovation in service delivery and citizen access

• Savings – our own target is 20% of the £2.1bn spend over three-years

Operational Delivery• Major national agreements developed in partnership between CCS, GDS and the Pro5

• CCS has a significantly expanded regional Customer Service function

• Drive as much input and influence as possible from customers

• Have defined roles for LG staff that want to get involved

9 Commercial Reform

LG Software Applications - Now£500m + spend per year in Local Government

Councils report common issues around value, technology capability and service support

Multiple, independent budget-driven solutions – often extending failing agreements

A complex pattern of bespoke deployments and licensing model creates lock-in

A complete lack of transparency and control

Huge waste and lost opportunity

10 Commercial Reform

LG Software Applications – A Major Opportunity for 2013/14

A common procurement platform which enables access toALL major systems

All commodity unit costs explicit

Flexible access through direct award and further competition

A range of technology models: hosted, licensed, SAAS

A master standard SLA to enable agile deployment

Developed, owned and used by Local Government

TCO reduction? …could be up to 50%

11 Commercial Reform

IT Products, Associated Services and Solutions

Transactional IT Procurement System (TIPS)

1 Contract

4 Lots

6 Lots

Information Assurance (Product and Services)

Commodity Software Solution Services

IT Products & Value Add Services

End User Computing Devices

Transactional portal for COTS IT Hardware and Software Products

Packaged Software & Value Add Services HR

Document Management

Data Management

ERP

Finance / Accounting

CRM

Proposed Procurement Vehicles & Lot Structure

12 Commercial Reform

IT End User Computing Devices

IT Product and Value Added Services

Information Assurance

YES

YES

IT Products, Associated Services and Solutions (IT PASS)

Targeted Audience

Value Added Resellers

End User Devices providers

Anticipated Suppliers

10 – 15 Suppliers 7 – 12 Suppliers

3 – 7 Suppliers

Service Requirement

Wider range vendor neutral products

Close to the box IT hardware related services

IT consumables and accessories.

Value-add associated services

Desktop computer bundle

Laptops, Tablets, Thin client, Hybrid device

Accredited vendor neutral IT Product providers

Secure destruction & disposal

HMG compliant facility (List X )

Framework Access

Further competitions

Regular eAuction Further competition

Further competitions

IT PASS – Framework Agreement structure

Packaged Software Value Added Services

Large Account Resellers

P2P Further competition

10 – 15 Suppliers

Wide range vendor neutral products

Enterprise Software licenses

Implementation and configuration services

Value added associated services

Large Account Resellers

13 Commercial Reform

Contact DetailsWill Laing

will.laing@ccs.gsi.gov.uk07775 561287