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Consortia: way forward or waste of time? ACEVO & Neil Coulson Associates

Consortia: way forward or waste of time?

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Consortia: way forward or waste of time is the main topic of this presentation. ACEVO and Neil Coulson Associates discuss. Find out more about the Evolve conference: http://www.ncvo.org.uk/training-and-events/evolve-conference

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Page 1: Consortia: way forward or waste of time?

Consortia: way forward or waste of time?

ACEVO &

Neil Coulson Associates

Page 2: Consortia: way forward or waste of time?

Why consortia?

Barriers Facing Small Organisations

• The procurement process (long, complex, expensive)

• Unable to find out about opportunities

• Contracts are too big

• Frameworks (if too complex and too large)

Page 3: Consortia: way forward or waste of time?

Barriers…cont

• Pre-qualification

• Understanding the requirements (anachronisms used, poorly worded specifications)

• Lack of feedback

• Cashflow

Page 4: Consortia: way forward or waste of time?

Consortia – overcoming barriers

• Scale

• Development of specialist tendering and contract management infrastructure

• Greater bargaining power

• Adding value at the frontline

• Building capacity

Page 5: Consortia: way forward or waste of time?

Key Trends Part 1 (deficit reduction and heightened competition)

• Deficit reduction

• New forms of private sector competition

• New forms of social economy competition through ‘externalisation’ of public sector human resources

Page 6: Consortia: way forward or waste of time?

Key Trends Part 2 (changing dynamics)

• Radically changing dynamics within the commissioning arena

• The ‘more for less’ agenda – downward pressure on unit price and greater focus on outcomes

• Reduction of ‘transaction costs’ through aggregation (joint commissioning, bundling) -> devolved commissioning

Page 7: Consortia: way forward or waste of time?

Key Trends Part 3 (political reform)

• Big Society – shift from state to non-state provision

• Modernising Commissioning• Localism Act (inc. Community Right to

Challenge)• Social Value Act• Personalisation

-> Growth of voluntary sector consortia, management companies, special purpose vehicles

Page 8: Consortia: way forward or waste of time?

Different Contracting Forms

• Provider

• Managing Agent

• Managing Provider

• ‘Super Provider’

Page 9: Consortia: way forward or waste of time?

Provider

Contractor

Provider Provision of Services

Page 10: Consortia: way forward or waste of time?

Managing Agent

Contractor

Managing Agent

Sub-contractors Provision of Services

Page 11: Consortia: way forward or waste of time?

Managing Provider

Contractor

Managing Provider Provision of Services

Sub-contractors Provision of Services

Page 12: Consortia: way forward or waste of time?

Managing Agent/ProviderContract top slice

Percentage of contract to pay formanagement of sub-contractors:

Performance Quality Financial management

Page 13: Consortia: way forward or waste of time?

‘Super Provider’

Provider Provider

Provider Provider

Provider Provider

Page 14: Consortia: way forward or waste of time?

aka Formal Consortium

Collaboration Spectrum

Networks/ Loose consortia Formal consortia Mergers

Partnerships

Page 15: Consortia: way forward or waste of time?

How does it work?

• Incorporation to form new legal entity

• Providers become members of this company

• Hub and spokes operating model

Page 16: Consortia: way forward or waste of time?

Hub & Spokes operating model

Page 17: Consortia: way forward or waste of time?

Ownership & Management Structure

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Social ownership

• Owned and controlled by the members

• 2 tier governance:

Council of MembersBoard

Page 19: Consortia: way forward or waste of time?

Some Examples

• Sheffield Well-Being Consortium

• Wakefield District Well-Being Consortium

• Desta

• C3C

• Greater Together

• Synergy

Page 20: Consortia: way forward or waste of time?

Challenges

• Building trust

• Managing conflicts of interest

• QA and accountability

• Measuring social return

• Access to capital

• ‘Investment readiness’

Page 21: Consortia: way forward or waste of time?

Critical Success Factors

Demand side

• Commissioner Commitment

• Commissioners’ Attitude to Change & Risk

• Market Opportunities

Page 22: Consortia: way forward or waste of time?

Critical Success Factors…cont

Supply Side

• From culture of entitlement to culture of enterprise

• Leadership, business skills and entrepreneurial acumen

• Long-term vision

• Resilience

Page 23: Consortia: way forward or waste of time?

http://consortiasupport.org.uk/