Back to Basics: The Importance of Culture in a Service Commissioning Partnership
Byon September 13, 2012
There are many factors that you must bring under consideration when entering into a service commissioning partnership.
You are no doubt familiar with the “usual suspects” — price and capability. It isn’t unreasonable for them to be key considerations — after all, the success of any commissioning partnership is typically defined by its cost and service delivery quality. But that does not mean that price and capability should be the only considerations.
There is one other key factor that you should bear in mind both when choosing a service commissioning partner, and managing a commissioning partnership on an on-going basis.
Understanding the Differences in Culture
As a ‘not for profit’ organisation, your objectives are driven by public service. Your primary goal is to leverage the resources available in order to deliver an efficient and quality service to your public.
Your commissioning partner is not driven by the same primary goal — regardless of what they tell you. Their ultimate responsibility is towards their shareholders — not your ‘customers’, the general public. Profit and cash flow are their key considerations. Whilst a good service and efficient workflows can lead to the achievement of their own primary goal, the two do not always walk hand in hand.
Aligning a profit culture with a service delivery culture is not wholly possible. The challenge is in bringing your two cultures together in a way that will result in a mutually beneficial relationship.
Pre-Contractual Due Diligence
Finding the right service commissioning partner necessitates a number of steps that involve far more than assessing the partner’s pure capability. Culture is an oft-ignored key consideration.
For instance, if your organisation takes the decision to partner with a new player in the market, you must ensure that it possesses the technical expertise, as well as the business, organisational and change management skills necessary to deliver the promised outsourced business benefits.
This form of due diligence also applies to well established commissioning partners. Whilst such organisations have experience in abundance, they usually have a high turnover of staff. Therefore, your due diligence should focus on their internal processes, so you can be sure that regular changes of staff would not adversely impact your partner’s ability to deliver your objectives and benefits realisation programme.
However, your focus should not solely be external. In order to ascertain whether or not your cultures will align, you must consider how a commissioning partner’s structure compares with your own internal processes. Questions might include:
- Are they more or less formal than you are?
- Are their service delivery staff personable, or “all business”?
- Is their standard for quality similar to yours?
- Are your respective staff likely to work well together?
- Do they understand public sector organisations?
Consider your own organisation’s culture and seek to delineate its strengths and weaknesses. Seek a partner that compliments your strengths, and supplements your weaknesses.
Ensuring On-going Culture Alignment
Finding the “right” partner is just the first step — culture alignment requires a conscious on-going effort.
Good communication is critical to the success of any service partnership, and is especially important when bringing two opposing cultures together. You must be cognisant of cultural differences that might affect how expectations and objectives are being interpreted, and impact the resolution of problems and misunderstandings.
It is the responsibility of the Chief Resources Officer (CRO) and the Outsourcing Governance Team to ensure that the requirements of each project deliverable are well understood, and that a contract mechanism is in place (and is actively followed) to account for the differences when problems or questions arise. When documenting project requirements, reviewing technical specifications or deciding on timetables, the CRO should confirm that the details are understood by all.
Ultimately, you have the best chance of meeting business objectives by being utterly clear with your partner as to what you expect to achieve, so that they can work to a plan that results in satisfaction on both sides of the agreement. If you are aware of the culture clash, and seek to address it by working together in a mutually beneficial relationship, your partnership will have every chance of success.
Creative Commons image courtesy of dhendrix73