Payment by Results Survival Guide

Nicky Robertson-Peek, 3SC

Steve White, VCS Assist

Introduction

Payments By Results

Work Programme

The future e.g. Transforming Rehabilitation/WorkChoice/WP2

Market share shift

End loaded contracts

The Third Sector is traditionally better at providing bespoke services and individual support that promotes sustainability with so called “disadvantaged groups”

With the right platforms, processes and planning the Third Sector will ALWAYS be better than the private sector at delivering sustainability because they PUT THE CUSTOMER FIRST!

Payment by Results Five Main Problem Areas

Areas we will cover:

Finance and Forecasting

Caseloading and RAG rating/Staff Resource

Employer Engagement

Sustainability

Quality and Compliance

Financing and ForecastingTroubleshooting

Issues:

Contract Profiles v performance

Delivery to meet Contract Compliance (not getting thrown out of supply chain)

Level of Deficit against profiles

Delivery to meet organisational financial needs (more than contract minimums)

What is realistic to achieve?

PBR Cash flow

0 Time

Cash

Financing and Forecasting

Issues:

Current Conversion Rates

Case loads too high? Too many staff?

Throwing money at problems and poor performance

Lack of accurate output forecasting for cash flow

Unable to return contract due to punitive penalties

Overgenerous resourcing

Been put on performance improvement by Prime (Breach)

Solutions: Finance and Forecasting

Cost/benefit analysis of overall contract value for next 6 months

Design Flight Path forecasting for each year.

Regular checks of unclaimed output opportunities

Cut out resource waste and duplication i.e. premises, staffing, resources

Exploit double funding opportunities i.e. with other partner courses with REDs

Viability of Contracts through overall improved performance in all areas.

Solutions: Finance and ForecastingFlight Path Diagram

Flightpath 2.xlsx

Caseloading and RAG rating

Most people can’t RAG rate properly

Which effects everything from forecasting to assignment to wrong staff

Ineffective employer engagement

Distance from Labour Market

Costs

RevenuesX

X

X

X

X

X

X

X

X

RED Amber Green

Profile of RAG Rated Clients

RED – extensive barriers to overcome to enter employment, lots of support needed, low self confidence, no employability skills

Areas:CV’sEmployability TrainingBasic Skills Training

AMBER - Need motivating, some employability skills, previous employment skills, some interview skills, recently gained skills qualifications

Areas:Interview TrainingCV’s

GREEN – Motivated, keen to work, self-confident, employability skills, ready for interview

Areas:Arranged InterviewsMock InterviewsMaximise Confidence

Exercise 1 : RAG Rate example Clients

RED

Amber

Green

Operational RAG Rating

Highly unlikely to find employment in the life of the contract

Core caseload Sliding scale

Likely to find employment quickly with minimal support

Employment Advisor Profile:

Team qualities/skills;• Empathy, compassion personal experience of related barriers (disability/addiction/homelessness/criminal record/debt)• Sales/target driven/bonuses• Graduate – no experience in W2W (articulate/good communication skills/creative) –some organisations have made this their model for staffing• Commercial recruitment background• Trainer/tutor• Older – diverse employment history• Volunteers (how do we use them?/could be any of the above)• Mentors - (how do we use them?/could be any of the above)• Who does In-work support calls?• Administrators (how are they used/ what are their skills? • Any of the above?)

Staff Resource

Issues:

Division of case loads does not reflect staff skills

Lack of output targeting set for staff

Unrealistic panic targeting against staff skills

Culture shift and team dynamics

Problems with TUPE staff

Lack of Accountability of poor performers.

Lack of effective supervision

Solutions: Staff Personal ActionPlanning

100% Buy-in by staff to the contract (collaborative Flight Path)

Effective Targeting. Do you have team targets or/and individual targets?

How are those targets communicated (competitions, team boards etc)

What sanctions are you prepared to impose on poor performance?

Solutions: Staff Resource

Perform team skills analysis and individual staff review

Examine Case Load and link to identified skills set

Set clear challenging realistic targets for all team members

Develop individual staff work plan and support through effective supervision.

Effect staff buy-in through accountability (wake up call)

Instigate regular staff performance meetings. (channelling what works)

Channelling whatever works with team dynamic

Put in place effective supervision structure with both rewards (incentives) and consequences for non performance within the team dynamic

Break up cliques, of poor performers and effect proper inductions of TUPE staff.

Employer Engagement

Issues:

Lack of dedicated member of staff

Lack of skills in sales and employer engagement

Wasting resource on unrealistic jobs opportunities

Lack of communication between advisors and employer engagement staff

Lack of understanding of case load potential or limitations

Organisation working in isolation within local labour market.

Solutions: Employer Engagement

Identify or recruit most suitable member of staff to dedicated post.

Examine the caseload’s skills and aspirations for unrealistic expectations within local labour market

Partner with other organisations to maximise replicable vacancies

Working with other organisations fulfil employer vacancies

Regular team meetings to discuss employer engagement and interventions re caseload

Essential investment in Employer Engagement Post or Training.

Sustainability

Issues:

Lack of resource for contract

Pressure of short term performance targets affecting long term contractual compliance resulting in job dropout etc through lack of proper job matching.

Excessive pressure on staff to perform to meet short term gains.

Organisation at high financial risk due to poor performance

Performance slippage after short term bursts of crisis management of contracts.

Solutions: Sustainability

Embed monitoring systems and tracking to ensure monthly targets are met.

Higher success will generate more income to meet resource demands.

Ongoing analysis of good practice and what works to evolve, up skill and develop competencies to meet contract targets.

Effective forecasting to ensure long term goals and targets are met.

Proper support to staff to ensure development of skills and aid delivery.

Building up a network of suppliers, employers, complementary agencies to ensure delivery of outputs.

Quality and Compliance

Issues:

Contracts in breach due failing audits/quality/compliance

Over or under resourcing of quality systems to meet compliance

Lack of staff buy-in and commitment to contract quality issues

Huge risk in terms of illegality through fraud due to lack of internal audits, and checks.

Solutions: Quality and Compliance

Designate a quality compliance champion within the organisation to monitor and ensure contract quality and compliance standards are met.

Ensure that minimum quality standards are met and reduce administrative burden on organisation.

Encourage staff peer auditing to reduce quality admin and encourage good practice and time effectiveness.

Set minimum file reviews per month to ensure that files are all reviewed ready for any contract audits.

Ensure staff buy-in by integrating into staff roles rather than it being seen as something ‘extra’.

Exercise 2 : Turning around a failing PBR contract

Exercise 2 :

Jobs-R-Us is a London-based charity with 22 staff members and a turn over of £1.5m. They have a number of W2W contracts and have a successful track record of delivering employability contracts for GLA, ESF, London Councils etc to long term unemployed. They also deliver literacy, numeracy and ESOL classes. They are tier 2 end-to-end delivery provider on Work Programme and have approx 800 customers. They initially started well and met all their targets for job entries but for the last 6 months they have had erratic performance (sometimes meeting in-month contract targets and then the next month being 60% below profile). This has resulted in them becoming significantly behind profile and having a deficit that is accumulating every month. The Prime has put them on a 3 month Performance Improvement Plan (PIP) and the Board have raised concerns about cashflow. The staff have been made away that they may have to make redundancies if this continues and this has seriously impacted on staff morale.