Tuesday 30 September 2008

In the Commissioners' shoes

It isn't easy, commissioning innovative services.

For one thing, the environment has completely changed. With the sharp separation between commissioner and provider (see "Great Wall of China" - left (whoops someone's turned it into a water park), instead of performance managing a contract, commissioners now have to understand the need, work out the solution, then procure it in a fair and proper manner.
All this, and typically providers have a monopoly on the data, and whilst commissioners often write reporting into the contract, as long as people get the service they need it's difficult to bring any serious sanction to bear if a provider fails to supply the necessary data.
Commissioning innovation is more difficult again. I'm not only looking for a new supplier (or at least opening up the market to more and different suppliers), but I'm also looking for a new service and quite frankly I don't know if it will work. Who wants their name to be associated with something that failed?
As we discovered working with public services and third sector organisations, there's a real issue for innovative service providers to understand what the commissioner needs in order to feel comfortable, and conversely it can be difficult for commissioners to recognise the resource cost of developing new services, presenting their outcomes and occasionally having services which don't work as planned, where people need to be redeployed.
There's also the personal issue - working with a supplier for years should result in a relationship based on trust. This means that a commissioner recognises, to move a service to another supplier means his/her friends are going to be out of a job. That's why you sometimes see unequal comparisons eg in one local authority they allow 40% overhead on salary costs for internal providers (providers who are part of the local authority) and 20% for third sector organisations - and that's without recognising that many of the overheads in the local authority (buildings, vehicles etc) aren't even declared as they are treated as fixed costs.
The Innovation Exchange in London is hosting a programme to work with public services commissioners and providers from a variety of backgrounds to explore these issues. This follows Ann James' very successful "Meet the Dragons" event.
I'm sure there's a lot to be learnt. The event is next week, I'm reporting on it and I'll update this blog.

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