taking forward shared services in nhs wales - Health in Wales




TAKING
FORWARD
SHARED
SERVICES
IN
NHS
WALES
 
 
 Final
Report
of
Research
conducted
for
the
National
Assembly
for
Wales
 (Cynulliad
Cenedlaethol
Cymru)
 
 
 
 
 
 Professor
Michael
Lewis
 Dr
Sinead
Carey
 Dr
Wendy
Phillips
 
 
 
 
 University
of
Bath
School
of
Management

 
 10
October
2009





1


EXECUTIVE
SUMMARY
 Re‐structuring
of
the
Welsh
NHS
means
change
for
much
of
its
existing
‘narrow’
 (e.g.
specific
financial
processes)
and
‘broad’
(e.g.
certain
professional
services)
 shared
service
portfolio
and,
correspondingly,
this
creates
an
opportunity
to
reflect
 on
experience
to
date
and
consider
future
options.
This
report
summarises
the
key
 findings
from
a
study
carried
out
by
a
University
of
Bath
School
of
Management
 team
between
May
and
September
2009
to
support
this
process
of
reflection
and
 option
generation.
The
project
highlights
an
intriguing
mix
of
confusion
and
 capability
regarding
shared
service
arrangements
in
WNHS.
With
respect
to
 confusion
surrounding
the
phenomenon,
it
is
clear
that
the
emergent
nature
much
 of
the
debate
has
excluded
key
stakeholders
(including
many
of
those
from
‘broad’
 shared
services)
and
allowed
misperception
and
organisational
politics
to
come
to
 the
fore.
The
report
makes
a
specific
recommendation
intended
to
deal
with
this
 confusion:
(1)
To
develop
(and
widely
share)
a
common
shared
services
concept.
 With
respect
to
the
shared
service
capability
within
WNHS
the
report
also
makes
 two
specific
recommendations:
(2)
To
promote
and
protect
extant
narrow
shared
 service
capability,
and;
(3)
To
use
the
operating
concept
to
review
‘broad’
shared
 service
arrangements.
The
final
recommendation
is
intended
to
help
deal
with
 confusion
and
enhance
capability:
(4)
The
need
to
establish
a
shared
‘shared
 services’
transition
capability?





2


TABLE
OF
CONTENTS
 
 1.
INTRODUCTION
 
 2.
WHAT
ARE
SHARED
SERVICES?
 
 3.
WHAT
ARE
SHARED
SERVICES
IN
WNHS?
 3.1.
Too
narrow
an
emergent
shared
services
concept
 3.2.
Limiting
emphasis
on
short
term
efficiency
 RECOMMENDATION
1
 
 4.
THE
PERFORMANCE
OF
SHARED
SERVICES?
 
 5.
THE
PERFORMANCE
OF
SHARED
SERVICES
IN
WNHS?
 RECOMMENDATION
2
 RECOMMENDATION
3
 
 6.
THE
TRANSITION
TO
SHARED
SERVICES
 6.1.
Process
Stability
 6.2.
Interactional
Maturity
 6.3.
Business
Case
 6.4.
Governance
 RECOMMENDATION
4
 
 7.
CONCLUDING
COMMENTS
 
 APPENDIX
1:
SOURCE
MATERIAL
 APPENDIX
2:
INTERVIEW
PROTOCOL
 APPENDIX
3:
LIST
OF
STAKEHOLDER
INTERVIEWS
 APPENDIX
4.
THE
FUTURE
OF
SHARED
SERVICES
IN
WALES?
 Trend
Analysis
and
Problem
Scoping
 Uncertainty
Mapping
 Scenario
Creation
 





4
 5
 6
 7
 7
 8
 11
 12
 13
 15
 16
 17
 17
 18
 18
 19
 20
 22
 25
 26
 27
 27
 28
 29


3


1.
INTRODUCTION
 In
addition
to
the
numerous
“well
established
examples
[of]
working
together”
 across
the
Welsh
public
services
(WLGA
2008:
5),
the
Welsh
NHS
(WNHS)
has
 developed
a
range
of
shared
services
(i.e.
narrow,
transactional
and
broad,
 professional
services).
Given
that
the
advent
of
7
integrated
Local
Health
Boards1
 means
inevitable
change
for
much
of
this
shared
service
portfolio,
there
is
a
 significant
opportunity
at
this
transition
point
to
reflect
on
experience
to
date
and
 consider
future
options.
This
is
particularly
important
given
that,
despite
having
 been
at
the
forefront
of
such
collaborative
arrangements
in
Wales,
the
shared
 service
concept
remains
contentious
and
inadequately
understood
by
the
broader
 WNHS
community.
This
report
summarises
the
key
findings
from
a
study
carried
 out
by
a
University
of
Bath
School
of
Management
team
between
May
and
 September
2009
to
support
this
process
of
reflection
and
option
generation.
The
 specific
objectives
included:
 
 1. Reviewing
current
theory
and
practice
(in
Wales,
WNHS
and
beyond2).
 2. Collating
key
stakeholder
positions
on
shared
service
practice3.
 3. Developing
practical
recommendations
‐
informed
by
and
refined
through
a
 series
of
workshops
‐
on
shared
service
policy
options.
 
 The
report
is
structured
as
follows:
sections
2
and
3
introduce
the
basic
concept
of
 shared
services
and
describe
current
WNHS
practice
‐
exploring
why
there
is
 confusion
surrounding
the
concept,
sections
4
and
5
look
at
the
performance
 potential
of
shared
services
and
reality
in
WNHS
and,
section
6
explores
the
 challenges
of
moving
towards
shared
arrangements.
Section
7
offers
some































































 1


Together
with
a
National
Advisory
Board,
a
National
Delivery
Group
and
the
Wales
Centre
for
 Health
and
National
Public
Health
 2 
Where
practicable,
the
research
also
sought
to
engage
with
the
broader
context
of
‘Making
the
 Connections’,
Value
Wales,
Xchange
Wales
and
other
specific
shared
service
developments
in
local
 government.
 3





See
Appendix
2
for
interview
protocol
and
Appendix
3
for
list
of
interviewees.


4


concluding
comments
and
reflects
briefly
on
future
scenarios.
Recommendations
 are
presented
throughout
the
document
as
they
emerge
from
the
research.
 
 2.
WHAT
ARE
SHARED
SERVICES?
 Shared
service
are
collaborative
arrangements
in
which
certain
business
functions
‐
 predominantly
a
combination
of
(so‐called)
back
office
or
corporate
support
 services
such
as
Finance,
Payroll
and
the
more
transactional
elements
of
HR
and
 Procurement
‐
are
concentrated
into
a
new
(semi)‐autonomous
business
unit4
in
 order
to
be
more
efficient
and
more
focused.
 
 •

More
Efficient.
Following
the
Gershon
Report
suggestion
of
significant
potential
 efficiencies
associated
with
Shared
Services,
the
Cabinet
Office
2005
initiative
 highlighted
a
figure
of
£1.4Bn
in
potential
savings
if
central
and
local
 government
as
a
whole
made
a
sustained
commitment
to
the
approach.
This
 figure
was
based
on
an
assumed
20%
reduction
of
the
estimated
£7Bn
 expenditure
on
finance
and
human
resource
services.
Although
this
figure
is
no
 longer
promoted5
the
CIO’s
website6
still
quotes
typical
savings
of
between
20
 and
40%7.
Similarly,
shared
service
options
are
considered
to
be
central
to
 Scotland’s
Efficient
Government
Plan
and
a
Scottish
Executive
consultation
 paper
in
May
2006
promoted
“a
potential
level
of
savings
…
of
between
£250m
 and
£750m
across
the
whole
of
the
Scottish
Public
Sector,
equivalent
to
 between
1%
and
3%
of
total
operational
costs”.



•

More
Focused.
Shared
services
should
underpin
improved
service
delivery
and,
 crucially,
allowing
other
operating
units
to
focus
on
core
areas
of
service
 provision.
The
shared
services
guidance
issued
by
the
Scottish
Government
 (2007)
highlights
how
a
more
focused
delivery
model
can
underpin
greater































































 4


Bergeron,
B.
(2002)
Essentials
of
Shared
Services,
Wiley,
0471250791

 
The
URL
reported
by
the
NAO
is
no
longer
active
 6 
http://www.cabinetoffice.gov.uk/cio/shared_services/faqs
 7 
A
survey
of
FTSE
250
companies
found
average
savings
of
12%
on
operational
costs
and
an
average
 payback
period
of
3.5
years.
(PA
Consulting
Group
2007.
Shared
Service
Centres:
Delivering
the
 Promise)
 5




5


transparency
and
clearer
lines
of
responsibility
–
making
it
easier
to
see
what
 and
where
processes
are
not
working.
This
focus
is
normally
achieved
via
a
 single
organizational
structure,
centralizing
activities
onto
a
single
site
(or
at
 least
a
limited
number
of
sites)
under
one
(quasi)
contractual
arrangement.
 
 To
realize
these
benefits,
commercial
partners
play
a
significant
role
in
most
private
 and
many
public
sector8
arrangements;
the
shared
service
functions
are
transferred
 to
a
different
organization,
either
within
the
home
nation
or
partly/fully
located
in
 another
country
with
lower
labour
costs
(i.e.
labour
arbitrage).

 
 3.
WHAT
ARE
SHARED
SERVICES
IN
WNHS?
 The
WNHS
has
a
diverse
ecology
of
‘narrow’
and
‘broad’
shared
service
 arrangements:
 
 •

Narrow
arrangements
include
the
Business
Services
Centre
(BSC)
and
Business
 Support
Partnership
(BSP).
These
organisations
provide
Local
Health
Boards
 with
certain
financial
services9
contractor
services;
human
resources;
 management
information
and
computer
technology.


•

Broad
arrangements
include
NHS
Legal
Services,
Welsh
Health
Supplies
and
 Welsh
Health
Estates,
etc.
These
organisations
offer
a
range
of
statutory
and
 non‐statutory
services,
hosted
in
a
variety
of
locations,
servicing
differing
 percentages
of
the
total
NHS
population.



 Against
such
a
diverse
backdrop,
it
was
unsurprising
that
some
contradiction
and
 confusion
would
be
revealed
when
interviewing
a
broad
stakeholder
community
–
 especially
given
the
current
deliberate
state
of
policy
transition.
Key
findings
with
 




























































 8


It
is
interesting
to
note
that
surveys
by
the
Economic
Intelligence
Unit
(2006)
and
Accenture
(2005)
 found
the
majority
of
public
organizations
in‐source
shared
services
with
support
from
external
 bodies
during
early
stages.
 9 
For
example,
the
BSP
managers
the
ledger
and
provides
accounts
payable,
finance,
recruitment,
 payroll,
pensions,
travel
expenses,
etc.
services
to
North
Wales.





6


particular
relevance
for
future
policy
options
can
be
summarised
under
two
related
 themes.
 
 3.1.
Too
narrow
an
emergent
shared
services
concept
 Even
amongst
those
interviewees
with
direct
experience
and
insight
into
narrow
 and
broad
shared
services,
the
instinctive
focus
on
IT
enabled
change
and
particular
 types
of
process
(Finance,
HR,
etc.)
was
striking.
Automation
and
increasingly
inter‐ operable
systems
clearly
offer
significant
benefits
in
any
organisational
re‐design
 but
one
of
the
(unintended?)
consequences
of
this
technology
led
logic
is
that
it
has
 become
almost
axiomatic
that
shared
service
initiatives
are
associated
with
‘back‐ office’
activities
such
as
finance,
HR
and
procurement
that
‘run’
via
an
ICT
 infrastructure.
This
strongly
reinforces
the
pervasive
sense
that
shared
services
are
 an
essentially
technical
problem
(in
terms
of
both
process
and
infrastructure)
to
be
 resolved
by
technical
experts.
This
narrowing
of
the
debate
is
reinforced
by
an
 explicit
emphasis
in
policy
discussions
on
“streamlining
corporate
functions
…
(e.g.
 finance
and
HR)”
(Making
the
Connections
2006)
and
encourages
an
acceptance
 that
‘back
office’
efficiencies
are
both
more
acceptable
and
easier
to
deliver
in
 practice.
 
 3.2.
Limiting
emphasis
on
short
term
efficiency
 The
overwhelming
logic
for
shared
service
arrangements
in
Welsh
Public
Policy
is
to
 “reduce
waste
and
inefficiency”
(Cabinet
Office
2005).
For
example,
when
 addressing
the
Beecham
Report’s
goal
of
better
value
for
the
Welsh
pound,
‘Making
 the
Connections’
(2006)
suggested
that
the
“NHS
shared
services
programme
and
 the
development
of
shared
services
projects
in
local
government
and
other
sectors”
 would
be
key
parts
of
an
efficiency
drive
intended
to
deliver
£600
million
a
year
 across
Welsh
public
service
by
2010.
It
is
important
to
note
therefore,
the
genuine
 ambiguity
surrounding
the
actual
benefits
of
Shared
Services.

International
studies
 (e.g.
Australian
Institute
for
Social
research,
2007)
highlight
that
whilst
cost
 reductions
can
be
realized,
meaningful
savings
are
typically
associated
with
job





7


losses
and
labour
arbitrage.
Moreover,
the
specific
efficiency
savings
presented
in
 many
business
cases
are
often
not
achieved.
The
WNHS
BSP
implementation
 provides
a
relevant
example
of
the
challenges
of
achieving
short
term
cost
savings:
 
 •

In
March
2008
the
Wales
Audit
Office
carried
out
a
review
of
the
North
Wales
 Business
Support
Partnership
project
for
the
Welsh
Assembly
Government.
It
 was
found
that
“the
project
has
the
potential
to
deliver
financial
benefits”
but
 that
these
“will
not
be
of
the
magnitude
and
timing
set
out
in
the
business
case”.
 The
savings,
originally
claimed
as
£2
million
per
annum
(£21.7
million
over
a
10‐ year
period),
were
subsequently
revised
to
£1.4
million
per
annum10.


•

In
common
with
many
shared
service
transitions,
the
BSP
business
case
was
 “overly
optimistic
about
the
short‐term
savings
achievable”.
Staff
savings
were
 unrealistic
given
the
nature
of
the
project
and
non‐pay
savings
(e.g.
audit
fee
 reductions)
were
always
unlikely
to
accrue
immediately.
More
fundamentally,
 the
business
case
was
predicated
on
the
implausible
assumption
that
the
BSP
 would
be
operating
at
“the
benchmark
level
from
the
outset”.



 In
sum,
shared
services
must
deliver
efficiencies
but
their
strategic
justification
–
as
 highlighted
previously
–
should
be
broader
and
include
the
benefits
of
focus
and
 improved
service.
An
over‐emphasis
on
short‐term
efficiency
is
particularly
 challenging
when
allied
to
the
assumed
narrow
operating
model.
In
these
 applications,
potential
savings
can
be
limited
because
of
the
initial
embedded
costs
 (i.e.
“It’s
not
surprising
that
squeezing
the
relatively
small
costs
of
the
‘back
office’
…
 doesn’t
produce
the
kind
of
savings
that
were
envisaged?”)
and,
for
WNHS,
lack
of
 private
sector
involvement
(i.e.
access
to
greater
scale
and
labour
arbitrage).
 
 RECOMMENDATION
1:
Develop
A
Common
Shared
Service
Concept
 The
lack
of
a
substantive
operating
concept
is
more
than
‘academic’
concern
over
 definitions.
There
is
clear
evidence
that
without
a
common,
strategic
basis
for
 




























































 10





Wales
Audit
Office
(2008)
Briefing
Paper
–
Lessons
leant
from
shared
service
projects.


8


shared
service
discussions,
subsequent
policy
developments
will
lack
broad
based
 engagement,
rapidly
become
reductive
around
narrow
technical
process
issues
(e.g.
 how
many
ledgers?)
and
will
result
in
options
that
offer
at
best
marginal
business
 cases.
Moreover,
all
change
initiatives
struggle
without
the
ability
to
communicate
a
 coherent
and
consistent
message
and
for
shared
services
narratives
this
is
 particularly
challenging
as
discussions
quickly
become
loaded
with
notions
of
 “privatization”,
“sheds
off
the
M4”
and
“Indian
call
centres”.
More
positively,
this
 gap
presents
an
opportunity
for
developing
a
Welsh
context‐specific
concept
that
 builds
on
the
lessons
learnt
from
shared
services
experiences
to
date.
The
research
 suggests
the
following
four
self‐supporting
attributes
that
together
could
be
used
to
 create
and
communicate
a
generic
(i.e.
broad
and
narrow)
WNHS
shared
service
 operating
concept:
 
 1. Stand‐alone
–
regardless
of
the
local
specifics
(e.g.
how
different
political
actors
 are
involved,
how
task
specialists
connect,
etc)
there
must
be
multi‐level
 governance
in
place
that
allows
the
shared
service
provider
to
be
focused
(and
 frees
its
partners
to
also
be
more
focused)
and
develop
a
distinct
organisational,
 managerial
and
operational
identity.
The
‘simplification,
standardization
and
 separation’
process
associated
with
creating
a
stand‐alone
operation
forces
all
 parties
to
understand
their
cost
base
and
from
an
accurate
base
line
begin
to
 plan
things
properly.
Interestingly,
those
within
WNHS
with
direct
experience
of
 the
transition
to
shared
service
arrangements
(i.e
managers
who
have
had
 resources/activities
removed
from
their
managerial
portfolio)
made
a
strong
 case
for
the
benefits
of
increased
focus.
In
addition
to
being
able
to
rely
on
more
 consistent
processes
and
systems,
the
removal
of
parts
of
the
organizational
 mix
makes
it
easier
for
managers
and
professionals
to
concentrate
on
a
 narrower
range
of
strategic
duties.





9


2. Scale
‐
it
must
be
big
enough
to
generate
efficiencies
through
meaningful
 removal
of
duplication11
but
these
arrangements
can
also
allow
for
capability
to
 more
effectively
leveraged.
Rather
than
(inevitably
variable)
levels
of
capability
 spread
across
a
large
number
of
organizations;
key
staff
can
be
combined
into
 more
critically
scaled
operations
(n.b.
professional
skills
scarcity
was
a
 motivating
factor
for
creating
many
of
the
broad
shared
services).
As
a
result,
 shared
services
can
enhance
expertise
and
build
capacity
as
employees
are
 provided
with
a
career
path
and
the
chance
to
develop
their
professional
skills,
 in
a
working
environment
where
their
skills
and
abilities
are
valued.
The
creation
 of
such
capability
communities
can
sustain
hiring,
developing
and
retention
of
 critical
staff.
 3. Standardisation
–
it
must
generate
efficiencies
and
better
service
by
process
 standardisation
and
therefore
must
incorporate
a
strong
process
management
 and
continuous
improvement
capability
and
philosophy.
Specific
theoretical
 benefits
from
standardized
processes
and
operating
systems
include
consistent
 performance
data
that
is
stored
in
one
place
–
potentially
improving
data
access
 and
simplifying
processes
(e.g.
supplier
audit,
personnel
checks,
etc.).
It
should
 also
increase
levels
of
financial
control
(e.g.
a
more
consistent,
timely
financial
 period
end
close)
and
improve
strategic
management
information
(allowing
for
 comparability,
etc.).
 4. Service
–
a
core
benefit
of
any
shared
service
arrangement
relates
to
the
ability
 to
clarify
the
respective
roles
of
the
provider
and
customer
and
then
focus
on
 delivering
superior
service.
The
shared
service
teams
can
focus
exclusively
on
 delivering
to
their
customer
requirements
and
improving
service
performance
 (i.e.
cost,
quality,
dependability,
etc.)
over
time.
Key
account
managers,
key
 performance
indicators
and
SLAs
are
all
central
elements
of
this
approach.
 































































 11


Research
reported
by
the
NAO
suggests
that
a
minimum
of
20,000
customer
employees
are
 needed
for
a
‘narrow’
shared
service
facility
to
provide
good
value,
with
better
returns
achieved
when
 50,000
or
more
employees
are
served.





10


It
is
important
to
stress
that
a
strong
operating
concept
should
be
a
self‐supporting
 system12.
For
example,
a
focused
stand‐alone
system
is
only
sustainably
viable
if
it
 has
sufficient
scale.
Sufficient
scale
drives
efficiency
(and
therefore
justifies
 independence)
but
also
ensures
the
level
of
capability
that
delivers
process
 standardisation.
Capability
reinforces
the
focus
of
the
organisation
and
underpins
 longer‐term
efficiency
and
service
design/improvement.
High
levels
of
performance
 reinforce
an
independent
identity
by
attracting
new
work
(increasing/maintaining
 scale)
and
make
recruitment
and
retention
easier,
etc.,
etc.
 
 4.
THE
PERFORMANCE
OF
SHARED
SERVICES?
 It
is
difficult
to
establish
the
direct
saliency
of
the
widely
quoted
savings
figures
 since
assumptions
made
regarding
the
baseline
cost
model
(e.g.
used
to
derive
the
 Cabinet
Office’s
£7Bn
figure)
are
rarely
made
explicit
and
there
is
often
no
indication
 of
the
timeframe
for
benefits
realization.
This
ambiguity
motivated
the
NAO
(2007)
 investigation
‘Improving
Corporate
Functions
Using
Shared
Services’.
Faced
with
 “no
accurate
figures
for
savings”
(p.4)
their
work
examined
two
of
the
best
known,
 and
arguably
most
successful,
shared
services
arrangements
in
UK
public
sector:
 
 •

The
HM
Prison
Service
Shared
Service
Centre
(an
in‐house
offering
with
IT
 provided
by
EDS),
based
at
Newport,
provides
finance,
procurement
and
 since
late
2008
HR
services
for
48,000
staff
at
128
Prison
Service
 establishments.
Operational
since
April
2006,
the
Centre
also
provides
 finance
and
procurement
services
for
other
Home
Office
staff.
The
gross
 savings
(i.e.
after
running
costs)
were
calculated
to
be
a
very
healthy
32%
of
 the
original
£66m
staff
costs
and
the
centre
was
forecast
to
deliver
NPV
 savings
of
£120
million
over
9
years,
with
a
break
even
at
5
years.































































 12


It
is
interesting
to
compare
these
with
the
founding
principles
of
the
BSC
“Economy
and
efficiency;


Standardisation
of
tasks;
Harnessing
the
skill
base;
Minimising
disruption
with
no
staff
relocation
 whenever
possible.





11


•

The
NHS
Shared
Business
Service
(a
joint
venture
with
Steria13),
based
in
 Leeds,
Bristol
and
Bangalore,
provides
procurement,
finance,
and
 accounting
services
on
a
‘opt
in’
basis
‐
an
initial
minimum
20%
gross
saving
 is
guaranteed,
followed
by
further
guaranteed
2%
year
on
year
cost
 reductions.
Since
its
launch
in
April
2005,
SBS
portfolio
of
clients
has
grown
 to
include
over
25%
of
NHS
trusts
(approx.
120
organisations
in
total).
NHS
 SBS
was
predicted
deliver
NPV
savings
of
£250
million
over
11
years,
with
 £160
million
in
the
first
9
years
and
break‐even
at
5
years.




 In
other
words,
with
the
usual
caveats
regarding
forecast
data14,
the
NAO
report
 suggests
that
both
deliver
cost
benefits
but
are
still
short
of
‘world‐class’
benchmark
 performance.
 
 Performance
Metric


NHS
 SBS


Prison
 Service


Average
 practice


Accounts
payable
transactions
processed
per
FTE
per
annum


7500


15500


25008


37773


Accounts
payable
direct
cost
per
transaction


£2.25


£2.12


£1.45


£0.68


Days
to
close
general
ledger
 Cost
per
payslip


Leading
 practice


7


5


5


5


£2.54


n/a


£2.44


£1.14



 Table
1:
NAO
(2007)
case
study
performance
against
benchmarks15
 
 5.
THE
PERFORMANCE
OF
SHARED
SERVICES
IN
WNHS?
 The
WAO
report
into
the
performance
of
the
BSP
(see
section
3)
highlighted
how
an
 overly
optimistic
(and
insufficiently
rigorous)
business
case
–
in
combination
with
 insufficient
recognition
of
the
transitional
challenges
–
can
easily
undermine
the
 case
for
shared
service
arrangements.
Similarly
the
BSC
(established
in
April
2003)
 experienced
a
challenging
‘birth’
–
receiving
poor
internal
audit
reports,
dealing
with
 customer
dissatisfaction
and
having
to
cope
with
significant
staffing
changes.
 




























































 13


In
July
2007,
the
original
partner
UK
IT
services
group
Xansa
was
bought
by
French
rival
Steria
in
a
 deal
valuing
the
company
at
around
£472m.
 14 
For
example,
the
early
adoption
rate
of
the
SBS
within
the
NHS
was
slower
than
forecast.
 15 
Note
that
comparator
data
is
from
Hackett
Group
(who
also
calculated
the
NHS
SBS
data)
and
the
 Prison
Service
Shared
Service
Centre
–
using
slightly
different
methodologies.





12


Despite
these
initial
difficulties,
subsequent
improvement
programmes
have
led
to
 significantly
improved
performance.
The
BSP,
for
instance,
provided
the
following
 data
suggesting
that
they
deliver
performance
levels
broadly
comparable
with
the
 NHS
SBS
and
Prison
Service
operations
and,
crucially,
can
point
to
a
meaningful
 ongoing
improvement
trajectory.
 
 Performance
Metric


WNHS
BSP
 Today


Year
End
 Target


Accounts
payable
transactions
processed
per
FTE
per
annum


11,400


12,800


Accounts
payable
direct
cost
per
invoice


£1.88


£1.76


Cost
per
payslip


£2.41


£2.30



 Table
2:
BSP
performance
against
benchmarks
 
 This
improvement
in
performance
is
underpinned
by
the
adoption
of
a
range
of
 effective
practices.
As
an
illustration,
the
relocation
associated
with
shared
services
 can
often
lead
to
them
being
seen
as
remote
from
their
service
users.
BSP
has
 managed
this
risk
by
careful
use
of
opening
hours
and
running
regular
on‐site
 support
clinics.
These
are
made
possible
by
“clever
scheduling”
(i.e.
clinics
at
off‐ peak
times,
using
staff
from
that
locality)
and
the
whole
initiative
is
funded
by
the
 process
efficiencies
generated
from
better‐informed
customer
behaviour.
 Similarly,
“against
the
background
of
delivering
value
added
service
improvements
 combined
with
an
increase
in
service
users
the
BSC
has
also
been
able
to
deliver
3%
 (minimum)
cost
improvement
targets
which
have
been
cash
releasing
allowing
the
 recurrent
savings
to
go
towards
re‐investment
in
front
line
services.
To
date
the
BSC
 has
generated
circa
£7m16
in
savings
since
its
inception.”
(BSC
Briefing
Note,
July
 2009).
The
BSC
has
also
emphasised
the
delivery
of
enhanced
service
and
in
 February
2009
became
the
first
NHS
organisation
(and
only
the
fifth
in
Wales)
to
 achieve
the
Cabinet
Office’s
Customer
Service
Excellence
standard.
In
other
words,
 both
‘narrow’
shared
service
centres
now
provide
meaningful
benefits
to
their
 




























































 16


After
inflationary
increases
BSC
has
achieved
savings
to
date
in
the
region
of
£5.3m
compared
with
 the
original
funding
level
of
£20.8m.





13


customer
base
and
represent
–
after
the
initial
transition
–
a
significant
capability
for
 the
WNHS.
 
 RECOMMENDATION
2:
Promote
and
Protect
narrow
shared
service
capability
 Evidence
suggests
that
after
difficult
‘births’
both
the
BSC
and
BSP
are
providing
 effective
service
and
have
succeeded
in
realising
savings
for
the
health
communities
 they
serve.
Crucially
they
have
achieved
this
performance
as
public
sector
 organisations,
working
under
the
One
Wales
policy.
Perhaps
because
of
their
 problematic
histories,
the
experiences
of
these
operations
are
less
well
 disseminated
than
they
might
usefully
be.
If
robust
benchmarks
for
tracking
and
 comparing
performance
are
communicated
to
a
wider
audience
–
together
with
a
 sense
of
the
best
practices
now
embedded
in
these
operations
‐
they
offer
the
 possibility
of
demonstrating
to
stakeholders
at
all
levels
how
shared
services
can
 benefit
both
the
WNHS
and
individuals.
With
respect
to
short‐term
transitional
 issues
associated
with
the
move
to
the
7
LHBs,
it
is
critical
that
WNHS
protects
the
 capability
they
have
painfully
acquired
in
these
centres.
This
‘protection’
process
 should
be
helped
by
greater
awareness
of
the
capability
but
it
needs
to
be
aware
of
 the
operating
model
described
previously
(i.e.
it
must
reflect
on
volumes
and
types
 of
work,
futures
for
key
staff,
governance
and
independent
identity,
etc.)
 Such
capabilities
can
be
rebuilt
but
as
experience
shows
this
takes
time
and
 investment;
and
in
the
near
future
these
may
not
be
available
to
a
WNHS
looking
to
 save
money.
It
only
seems
logical
to
conclude
that
this
reinforces
the
likelihood
of
 outsourcing
options
becoming
the
only
available
policy.
 
 Evaluating
‘broad’
shared
service
arrangements
is
more
challenging
–
given
that
 basic
efficiency
and
customer
satisfaction
calculations
only
provide
a
partial
 benefits
picture.
Welsh
Health
Estates
for
instance
is
able
to
demonstrate
customer
 satisfaction
and
highlight
that
its
day
rates
are,
on
average,
less
than
those





14


associated
with
national
and
regional
frameworks
drawing
on
equivalent
skills
mix17.
 Similarly,
the
Welsh
Health
Supplies
can,
in
addition
to
high
levels
of
customer
 satisfaction,
point
to
reductions
in,
for
example,
running
costs
as
%
of
contract
value
 (e.g.
down
to
0.38%
in
2009).
Equally,
in
benchmark
(product
and
service)
pricing
 comparisons
between
WHS
and
NHSSC/DHL,
WHS
was
cheaper
than
NHSSC
by
an
 average
of
£892,576.93
over
a
5‐month
period.
What
is
harder
to
determine
is
the
 total
‘value’
associated
with
these
predominantly
professional
shared
services?
For
 example,
WHS
are
currently
bidding
(against
the
WAG
“spend
to
save
initiative”)
for
 a
project
to
look
at
products
that
Trusts
and
LHBs
are
buying
outside
any
formal
 purchasing
arrangements.
This
is
clearly
an
area
where
there
is
massive
scope
to
 impact
overall
cost
performance
and
would
seem
to
be
central
to
the
mission
of
a
 service
like
WHS
–
and
yet
it
has
to
bid
for
additional
funding
to
carry
out
such
 work?
Regardless
of
the
specifics
of
this
example,
it
highlights
the
need
for
broad
 shared
services
to
operate
with
more
than
a
simple
input
cost
model;
their
impact
 relates
to
the
value
they
can
create,
not
the
hourly
rate
of
the
staff
they
employ?
 
 RECOMMENDATION
3.
Review
WNHS
‘broad’
shared
service
capability
 There
appears
to
be
insight
generated
when
reflecting
on
the
operating
concept
 (outlined
in
recommendation
1)
as
it
might
apply
to
‘broad’
shared
service
models:
 
 1. Stand‐alone
–
Despite
examples
of
good
practice,
the
governance
of
‘broad’
 shared
service
arrangements
appears
to
be
more
‘variable’
in
scope
and
 effectiveness
than
that
found
in
the
‘narrow’
BSP
and
BSC.
Most
were
created
as
 re‐drawings
of
organizational
boundaries
after
the
demise
of
the
common
 services
agency
and
correspondingly
the
research
suggests
that
identity
–
and
 crucially,
core
focus
–
can
be
ambiguous?
 2. Scale
‐
Skills
scarcity
is
clearly
a
defining
factor
for
the
performance
of
many
of
 the
broad
shared
services
–
all
the
interviewees
mentioned
the
challenge
of
 




























































 17


For
example,
the
day
rate
for
a
senior
professional
within
WHE
is,
on
average,
36%
less
than
that
 paid
under
a
framework
agreement
(WHE
Quinquennial
Review,
October
2007)





15


attracting
and
retaining
staff.
It
was
less
clear
that
this
aspect
of
sharing
(i.e.
as
a
 vehicle
for
creating
capability
communities)
was
perceived
and
presented
as
a
 central
part
of
the
operating
concept?
 3. Standardisation
–
Although
variability
and
change
are
defining
characteristics
of
 professional
services,
the
sustainability
of
the
broad
shared
services
will
still
be
 predicated
on
their
ability
to
exert
control
and
simplify
their
underlying
 processes.
Inevitably,
if
the
scope
and
focus
of
the
organisation
is
constantly
 shifting
this
is
particularly
challenging?
 4. Service
–
Customer
satisfaction
data
suggests
that
WNHS,
WHS,
WHLS,
etc.
 have
customers
who
are
broadly
happy
with
the
services
provided.
What
is
more
 interesting
is
the
extent
to
which
these
broad
services
are
able
to
fulfil
a
more
 pro‐active
public
value
creation
role.
 
 Any
review
of
‘broad’
shared
services
should
take
as
its
points
of
departure
the
 questions
of
core
focus
(and
therefore
value
proposition),
resource
scarcity
and
 effective
governance.
 
 6.
THE
TRANSITION
TO
SHARED
SERVICES
 As
with
any
complex
change
initiative,
simply
hoping
for
some
poorly
defined
set
of
 benefits
is
unlikely
to
deliver
any
meaningful
performance
improvements.
With
 specific
reference
to
shared
service
arrangements,
it
is
clear
from
the
research
that
 they
can
have
the
potential
to
improve
performance
(including
releasing
savings)
 but
achieving
these
benefits
requires
efficient
and
effective
implementation.
 Unsurprisingly,
the
evidence
from
those
currently
working
in
or
with
shared
services
 arrangements
placed
a
great
deal
of
emphasis
on
what
might
be
considered
generic
 management
of
change
issues,
including
the
need
to:
 
 •

create
effective
programme
management;


•

ensure
early
agreement
on
the
precise
nature
of
the
service
offering;





16


•

provide
adequate
resources
for
the
change
(i.e.
design,
migration,
testing
and
 post‐live
‘glitches’)
and
provide
realistic
and
timely
staff
training;


•

establish
clear
commercial
and
service
management
agreements18
and;


•

understand
the
difference
between
customer
and
provider
roles.



 The
research
did
highlight
a
number
of
additional
(shared
service
specific)
transition
 issues
that
need
to
be
considered
in
future
policy
development
and
implementation.
 
 6.1.
Process
Stability
 There
is
a
strong
argument
for
starting
any
shared
service
transformation
with
 stable,
standardized
processes.
Problematically
however,
this
is
likely
to
be
a
slow
 process
(i.e.
agree
standards
and
improve
before
sharing)
and,
given
that
benefits
 will
then
accrue
to
the
‘parent’
organization,
it
can
adversely
impact
a
shared
 services
business
case.
Moreover,
the
total
population
of
processes
needed
for
a
 shared
service
arrangement
(i.e.
to
achieve
sufficient
scale)
may
not,
at
least
 initially,
fall
into
this
category.
It
was
therefore
suggested
that
transfer
of
different
 processes
should
be
undertaken
incrementally.
Importantly,
this
would
also
allow
 lessons
to
be
learned
from
each
transfer
phase.
Inevitably
this
notion
of
needing
 process
stability
has
significant
implications
when
considering
the
application
of
the
 shared
service
logic
to
more
complex
or
specialized
services.
 































































 18


In
their
report
on
S2
initiatives
in
the
Department
of
Transport,
the
NAO
(2008)
highlighted
 confusion
because
“there
were
no
Service
Level
Agreements
setting
out..
responsibilities
of
the
 service
provider
and
customers
..
prior
to
go‐live”.
As
a
result,
significant
operational
problems
 emerged:
the
DVLA
believed
that
the
S2
centre
would
“update
staff
security
clearance
levels
and
 work
patterns
of
part‐time
staff
and
add
electronic
triggers
to
notify
when
Agency
drivers
required
 their
5‐year
medicals”.
S2
Centre
staff
believed
this
to
be
“the
responsibility
of
the
Agency.
Agency
 staff
believed
that
access
to
this
information
was
necessary
for
them
to
undertake
their
work,
but
 felt
the
information
was
neither
timely
nor
accurate.
The
S2
Centre
did
not
regard
this
information
 flow
as
its
responsibility.
By
March
2008
Driver
and
Vehicle
Licensing
Agency
staff
could
obtain
 information
on
security
clearance
levels,
but
not
work
patterns
of
part‐time
staff
or
driver
medicals.”





17


6.2.
Interactional
Maturity
 The
relative
maturity
of
the
interactional
context
also
matters
because
to
date
most
 NHS
organizations
have
had
funding
models
that
give
local
control
over
project
 selection
and
spending,
with
limited
incentives
for
co‐operative
behaviour.
Such
 ‘immaturity’
(rational
and
incentivized
though
it
may
be)
represents
a
significant
 challenge
for
shared
service
arrangements.
All
of
the
findings
in
this
project
confirm
 that
shared
arrangements
can
initially
be
more
expensive
and
take
longer
to
 stabilize
than
local,
proprietary
services.
A
great
deal
of
effort
has
to
be
invested
in
 communicating
the
need
and
then
designing
a
solution
that
meets
the
 requirements
of
all
stakeholders,
time
has
to
be
spent
on
Service
Level
Agreements,
 staff
have
to
be
trained,
etc.
All
of
this
set
against
the
backdrop
of
services
that
are
 already
working
–
albeit
perhaps
not
as
efficiently
or
effectively
as
possible.
It
could
 be
argued
that
this
represents
a
form
of
classic
Prisoner’s
dilemma,
where
the
 rational
‘local’
solution
is
the
one
that
is
natural
and
the
potentially
optimal
 outcome
can
only
be
reached
through
trust.
 
 6.3.
Business
Case
 Given
the
ambiguity
surrounding
short‐term
financial
benefits,
the
business
case
is
 a
crucial
component
in
determining
which
shared
service
projects
to
pursue
and
 which
to
abandon.
As
the
WAO
report
into
the
BSP
experience19
made
clear
in
its
 reflection
on
lessons
learned:
“The
main
difficulty
with
this
project
was
that
the
 stakeholder
board
did
not
apply
sufficient
rigour
to
the
development
of
the
business
 case.
The
business
case
was
never
revisited
and
revised
in
light
of
the
issues
and
 changes
that
arose.”
In
addition
to
robust
baseline
cost
modeling,
it
is
clear
that
a
 benefits/savings
realization
plan
needs
to
be
in
place.
Once
again
this
is
particularly
 challenging
because
various
stakeholder
organizations
need
to
‘declare’
and
release
 savings
to
the
broader
health
community.
The
business
case
also
needs
to
be
 realistic
about
the
timeframe
over
which
these
benefits
are
likely
to
be
accrued
–































































 19





Wales
Audit
Office
(2008)
Briefing
Paper
–
Lessons
leant
from
shared
service
projects.


18


noting
the
5
year
+
break‐even
points
for
even
the
most
successful
public
sector
 shared
service
initiatives.
 
 6.4.
Governance
 The
majority
of
the
interviewees
with
any
direct
experience
of
shared
services
 strongly
emphasised
the
need
to
ensure
effective
governance
was
in
place
 throughout
the
initiation,
design
and
implementation
life‐cycle:
‘get
the
governance
 right’
and
‘get
the
management
in
place
early’
were
key
lessons
from
the
NWBSP
 for
instance20.
The
broader
literature
also
stresses
the
need
to
consider
multiple
 levels
of
governance
including,
at
least,
(a)
the
enterprise/corporate
level
(which
 oversees
the
transition
and
ensures
alignment
from
a
strategic
and
operational
 perspective)
and
(b)
the
operational
level
(which
directs
service
delivery
and
ensures
 accountability
agreements
are
accurate)..
 
 RECOMMENDATION
4.
Create
a
shared
‘shared
services’
transition
capability
 It
was
explicitly
recognised
in
the
research
that
many
WNHS
(and
Wales
public
 sector
more
generally)
often
lacks
the
relevant
experience
for
implementing
shared
 service
arrangements
and
as
a
result
key
management
and
operational
posts
are
 often
filled
with
external,
often
temporary
(always
expensive)
appointments.
This
 damages
the
crucial
business
case
and
often
simply
delays
substantial
improvement
 options.
If
focus
is
given
to
ensuring
the
correct
level
of
capability
is
available
from
 the
outset
then
a
combination
of
appropriate
training
and
development
and
 practice
sharing
should
encourage
rapid
overall
capability
growth.
Pragmatically
 however,
scarcity
suggests
that
attempts
should
be
made
to
institutionalize
this
 capability
as
part
of
the
‘broad’
shared
services
mix.
Specifically,
this
‘shared
service’
 shared
service
needs
to
provide
support
for:
 




























































 20


This
meant
to
(1)
ensure
all
participating
organisations
and
functions
take
ownership
and
support
 the
change;
(2)
have
clear
reporting
lines/
targets;
(3)
define
Service
Level
Agreements
and
scope
of
 services
provided
and;
(4)
if
the
service
is
provided
to
more
than
1
legal
entity
–
clear
funding
and
 voting
arrangements
are
required.
 





19



 1. Performance
measurement.
In
addition
to
typical
efficiency
and
service
 measures,
there
is
a
need
to
evaluate
key
transitional
variables
such
as
process
 stability,
interactional
maturity,
governance,
etc.
As
an
illustration,
it
is
 interesting
to
note
that
NHS
SBS
has
recently
been
accredited
with
SAS
70
 (Statement
on
Auditing
Standards
No.
70).
This
is
an
emerging
international
 auditing
standard
developed
by
the
American
Institute
of
Certified
Public
 Accountants
designed
to
ensure
a
service
organization
has
been
through
an
in‐ depth
audit
of
their
control
activities,
which
generally
includes
controls
over
 information
technology
and
related
processes.

 2. Robust
cost
modelling.
Without
a
meaningful
‘as
is’
cost
and
performance
 position
it
is
difficult
to
establish
an
accurate
picture
of
potential
savings
–
it
can
 be
too
easy
to
resort
to
approximation
based
on
generic
benchmarks.
Of
course,
 cost
modeling
is
by
definition
particularly
challenging
in
shared
service
 applications
because
any
baseline
costs
will
require
the
summation
of
data
from
 multiple
parties.
Any
cost
modeling
of
the
options
should
also
include
sensible
 benchmark
allocations
for
transition
costs
and
possibly
some
form
of
 adjustment
for
optimism
bias.
 
 7.
CONCLUDING
COMMENTS
 Pressures
on
cost,
political
changes
and
increased
complexity
of
front‐line
provision
 will
reinforce
a
trajectory
whereby
fundamental
strategic
questions
over
the
 structure
of
the
Welsh
healthcare
‘value
chain’
will
continue
to
asked
and,
as
a
 result,
shared
service
arrangements
are
almost
certain
to
feature
in
all
potential
 futures21.
The
exact
shape
of
these
arrangements
is
what
remains
to
be
determined
 by
policy
makers.
 This
project
has
revealed
an
intriguing
mix
of
confusion
and
capability
regarding
 shared
service
arrangements
in
WNHS.
With
respect
to
any
confusion
surrounding
 the
phenomenon,
it
is
clear
that
the
emergent
nature
of
much
of
the
debate
to
date
 




























































 21


The
project
scope
included
a
more
reflective
element
looking
at
scenarios
for
the
future
of
the
 Welsh
NHS
(see
Appendix
4
for
further
details).





20


has
excluded
key
stakeholders
(including
many
of
those
from
‘broad’
shared
 services)
and
allowed
misperception
and
organisational
politics
to
come
to
the
fore.
 The
report
makes
a
specific
recommendation
intended
to
deal
with
this
confusion:
 (1)
To
develop
(and
widely
share)
a
common
shared
services
concept.
With
 respect
to
the
shared
service
capability
within
WNHS
the
report
also
makes
two
 specific
recommendations:
(2)
To
promote
and
protect
extant
narrow
shared
 service
capability,
and;
(3)
To
use
the
operating
concept
to
review
‘broad’
shared
 service
arrangements.
The
final
recommendation
is
intended
to
help
deal
with
 confusion
and
enhance
capability:
(4)
The
need
to
establish
a
shared
‘shared
 services’
transition
capability.
 As
a
final
comment,
there
will
also
be
increasing
pressure
to
‘share’
across
public
 organisations
but
such
collaborations
will
only
exacerbate
the
transitional
 challenges
identified.
Given
that
Gershon’s
report
was
a
significant
impetus
to
the
 adoption
of
shared
service
arrangements
in
the
UK
Public
Sector
it
is
interesting
to
 report
his
recent
observations.
In
a
report
for
the
Australian
Government22
he
 concluded
that,
although
during
the
review
“a
number
of
inputs
from
industry
 indicat[ed]
the
significant
benefit
to
be
obtained
from
shared
services”,
“the
mixed
 experiences
reported
to
us
by
the
CIOs
of
a
number
of
states
and
territories,
 together
with
the
recent
experience
of
the
UK
Government”
had
led
him
to
 conclude
that
any
“moves
towards
back
office
shared
services
between
agencies
 [emphasis
added]
should
only
be
undertaken
on
a
very
carefully
selected
and
 controlled
basis.”
Crucially,
Gershon
also
argued
that
the
essential
“first
step
 towards
a
wider
adoption
of
these
arrangements”
was
for
all
parties
to
“quantify
 both
the
back
office
service
levels
and
the
associated
costs
of
their
current
provision
 arrangements,
[using]
this
as
the
basis
for
determining
what
improvements
can
be
 realised
through
their
own
efforts,
such
as
process
simplification
and
a
reduction
in
 manual
interventions.
This
will
help
create
a
stronger
foundation
on
which
to
assess
 the
additional
benefits
that
can
be
obtained
from
moving
to
a
shared
service
in
the
 future.”
Given
that
WNHS
is
significantly
ahead
of
it
potential
collaborators
at
this
 




























































 22


Sir
Peter
Gershon
(2008)
“Review
Of
The
Australian
Government’s
Use
Of
Information
And
 Communication
Technology”
Report
for
the
Australian
Government.





21


point
in
time,
it
has
a
significant
leadership
role
to
play
–
providing
it
can
recognise
 and
build
on
its
own
strengths.
 
 
 
 Michael
Lewis,
Sinead
Carey,
Wendy
Philips
 
 10
October
2009





22


APPENDIX
1:
Source
Material
 
 Policy
Documents
and
Reports
(Incomplete)
 
 1. NHS
consultation
on
“Proposals
to
change
the
NHS
Structures
in
Wales”
(plus
 background
documents
on
hosted
functions
and
all
extant
NHS
Wales
 organizations)
and
all
Ministerial
statements;
 2. Consultation
responses
on
shared
services
(as
prepared
by
CapGemini);
 3. 2003
submissions
on
shared
services,
including
background
papers
from
 shared
services
working
group;
 4. WAO
and
KPMG
papers
on
the
BSP
in
North
Wales;
 5. Peter
Lewis
(24th
April
2009)
“NHS
Shared
Services
in
North
Wales
–
Lessons
 Learnt”,
North
Wales
Business
Support
Partnership;
 6. Public
Health
unification
papers;
and,
 7. South
Wales
BSC
Making
the
Connections
project
papers.
 8. WHS

 9. WHE
 
 Academic
References
 
 1. Bennett,
C.,
Ferlie,
E.,
1996.
Contracting
in
theory
and
practice:
Some
 evidence
from
the
NHS.
Public
Administration,
74,
49‐66.
 2. Bergeron,
B.
(Ed.)
(2003).
Essentials
of
Shared
Services,
Hoboken.
 3. Blake,
P.,
2005.
In
quest
of
shared
services.
Journal
of
Sourcing
Leadership,
2
 (2),

 4. Cecil,
B.,
2000.
Shared
services
moving
beyond
success.
Strategic
Finance,
81
 (10),
64‐68.
 5. Dollery,
B.,
Akimov,
A.
(2007.
Working
paper).
Critical
review
of
the
empirical
 evidence
on
shared
services
in
local
government.
 


23


6. Erridge,
A.,
Jonathan,
G.,
2002.
Partnership
and
public
procurement:
building
 social
capital
through
supply
relations.
Public
Administration,
80
(3),
503‐522.
 7. Forst,
L.I.,
1997.
Fulfilling
the
strategic
promise
of
shared
services.
Strategy
&
 Leadership,
25
(1),
30‐34.
 8. Forst,
L.I.,
2001.
Shared
services
grows
up.
Journal
of
Business
Strategy,
22
 (4),
13‐15.
 9. Grant,
G.,
McKnight,
S.,
Uruthirapathy,
A.,
Brown,
A.,
2007.
Designing
 governance
for
shared
services
organizations
in
the
public
service.
 Government
Information
Quarterly,
24,
522‐538.
 10. Hoggett,
P.,
1996.
New
modes
of
control
in
the
public
service.
Public
 Administration,
74,
9‐32.
 11.Janssen,
M.
(2005).
Managing
the
development
of
shared
service
centers:
 Stakeholder
considerations,
International
Conference
on
Electronic
 Commerce.
 12. Janssen,
M.,
Joha,
A.,
2004.
Issues
in
relationship
management
for
obtaining
 the
benefits
of
a
shared
service
center.
In:
Janssen,
M.,
Wagenaar,
R.
W.
Sol,
 H.
G.
(Eds.),
Sixth
International
conference
on
electronic
commerce.
New
 York,
219‐228.
 13.Janssen,
M.,
Joha,
A.,
2006.
Motives
for
establishing
shared
service
centers
in
 public
administrations.
International
Journal
of
Information
Management,
26,
 102‐115.
 14. Lee
Cooke,
F.,
2006.
Modeling
an
HR
Shared
Services
Center:
Experience
of
 an
MNC
in
the
United
Kingdom.
Human
Resource
Management,
45
(2),
211‐ 227.
 15. Martin,
S.,
2000.
Implementing
'Best
Value':
Local
public
services
in
 transition.
Public
Administration,
78
(1),
209‐227.
 16. Mergy,
L.,
Records,
P.,
2201.
Unlocking
shareholder
value
from
shared
 services.
Strategy
&
Leadership,
29
(3),
19‐22.





24


17. Murray,
G.J.,
Rentell,
P.,
G.,
2008.
Procurement
as
a
shared
service
in
English
 local
government.
International
Journal
of
Public
Sector
Management,
21
(5),
 540‐555.
 18. Nutt,
P.C.,
1986.
Tactics
of
implementation.
Academy
of
Management
 Journal,
29
(2),
230‐261.
 19. Shah,
B.,
1998.
Shared
services.
Industrial
Management,
40
(5),
4‐8.
 20. Ulbrich,
F.,
2006.
Improving
shared
service
implementation:
adopting
 lessons
from
the
BPR
movement.
Business
Process
Management
Journal
12
 (2),
191‐205.
 21. Ulbrich,
F.,
Bergström,
R.,
Löfstrand
Ianni,
A.,
Working
paper.
Transforming
 General
Performance
Objectives
into
Specific
Measurements
for
Shared
 Service
Centres.

 22. Walsh,
P.,
McGregor‐Lowndes,
M.,
Newton,
C.J.,
2008.
Shared
Services:
 Lessons
from
the
Public
and
Private
Sectors
for
the
Nonprofit
Sector.
The
 Australian
Journal
of
Public
Administration,
67
(2),
200‐212.
 
 
 





25


APPENDIX
2:
Interview
Protocol
 
 •

Introduction
to
project
and
interviewer


•

Interviewee
Name,
Role,
Organization,
etc.



 1. What
do
you
understand
by
the
term
‘shared
services’?
 2. What
experience
do
you
have
of
shared
services?
 3. What
do
you
understand
to
be
the
key
drivers/motives
for
establishing
shared
 services
arrangements?
 4. What
do
you
understand
to
be
the
key
benefits
of
shared
services?
 5. What
do
you
understand
to
be
the
key
risks
associated
with
shared
services?
 
[n.b.
prompt
contrast
planned
and
realised
benefits?]
 6. What
do
you
perceive
to
be
the
key
implementation
issues
associated
with
 establishing
shared
services?
 [n.b.
prompt
transition/change
management,
etc.]
 7. What
are
the
key
challenges
associated
with
the
ongoing
management
of
a
 successful
shared
service
arrangement?
 [n.b.
any
best
practice
lessons
from
within
Wales,
from
elsewhere?]
 8. What
do
you
believe
are
likely
scenarios
for
shared
services
within
Wales
in
the
 next
2,
5
and
10
years?
 [n.b.
Throughput
prompt
for
specific
illustrations,
secondary
evidence,
etc.]
 





26


APPENDIX
3:
List
of
Stakeholder
Interviews
 
 1. Andrew
Cottom,
FD,
Acting
CEX,
Gwent
NHS
Trust
 2. Ann–Louise
Ferguson,
Managing
Solicitor,
Welsh
Health
Legal
Services
 3. Bernard
Galton,
Director
of
People
and
Places,
WAG
 4. Chris
Daws,
Director
of
Finance,
WAG
 5. Dave
Galligan,
Regional
Head
of
Health,
Unison
Cymru
Wales
 6. Dr
Gwynn
Thomas,
Chief
Executive,
Informing
Healthcare
 7. Eiffion
Williams,
FD,
Abertawe
Bro
Morgannog
NHS
University
Trust
 8. Hugh
Morgan,
Director,
Health
Solutions
Wales
 9. Jan
Williams,
Cardiff
and
Vale
 10. Jeff
Buggle,
Director
of
Resources,
DHSS,
WAG
 11. Jeremy
Colman,
Auditor
General
for
Wales,
Wales
Audit
Office.
 12. John
Bowles,
WRP
Manager
 13. John
Hughes,
FD
Anglesey
LHB
and
Chair
of
LHB
FDs
 14. Judith
Paget,
Chief
Executive
&
Transition
Director,
Powys
LHB
 15. Mark
Roscow,
Director,
Welsh
Health
Supplies
 16. Martin
Sykes,
CEX,
Value
Wales
 17. Michael
Williams,
Chair,
North
Wales
NHS
Trust
 18. Neil
Davies,
Director,
Welsh
Health
Estates
 19. Neil
Frouw,
FD
Business
Services
Centre
 20. Paul
Davies,
FD,
Cardiff
&
Vale
NHS
Trust
and
Chair
of
Trust
FDs
 21. Peter
Kennedy,
Deputy
Director
(HR)
 22. Peter
Lewis,
Head
of
Finance,
BSP
North
Wales
 23. Steve
Thomas,
Chief
Executive,
WLGA
 24. Tony
Jewell,
Chief
Medical
Officer,
DPHHP,
WAG
 25. Wayne
Harris,
BSP
North
Wales
 26. Will
Mclean,
WLGA
 


27



 APPENDIX
4.
THE
FUTURE
OF
SHARED
SERVICES
IN
WALES?
 The
project
scope
also
included
a
more
reflective
element
whereby
those
critical
 factors
identified
in
the
review
of
practice
and
policy
would
be
used
as
the
basis
for
 creating
potential
scenarios
for
shared
service
in
the
Welsh
NHS/public
sector.
 Scenarios
and
scenario
planning
is
a
method
for
learning
about
the
future
by
 understanding
the
nature
and
impact
of
the
most
uncertain
and
important
driving
 forces
affecting
a
specific
problem
system.
To
be
truly
effective,
scenario
planning
 should
be
enacted
as
a
group
process;
with
the
goal
being
to
refine
a
number
of
 diverging
narratives.
These
narratives,
in
combination
with
the
process
of
creating
 them,
should
increase
knowledge
of
the
‘problem’
and
render
participants
(and
 corresponding
policies)
more
sensitive
to
possible
future
events.
In
this
respect
it
is
 an
entirely
appropriate
tool
to
deploy
in
policy
debates
concerning
an
intrinsically
 strategic
and
collaborative
challenge
like
shared
services.
The
underlying
method
 adopted
for
this
exercise
comprised
three
distinct
steps:
(1)
trend
analysis
and
 problem
scoping;
(2)
uncertainty
mapping,
and;
(3)
scenario
creation.
The
data
 underpinning
the
rest
of
the
project
provided
the
key
inputs
(i.e.
interviews,
 secondary
data)
to
the
research
team
discussions.
These
findings
were
then
 presented
at
workshops
where
participants
could
revisit
and
confirm/challenge
key
 assertions,
conclusions,
etc.
 
 Trend
Analysis
and
Problem
Scoping
 There
was
compelling
evidence
of
the
existence
of
multiple
forces23
‐
in
particular
 those
relating
to
future
public
sector
budget
restrictions
that
will
ensure
shared
 service
issues
feature
in
all
WNHS
futures.
Given
the
relatively
early
stage
of
 development
of
policy
across
Wales,
a
broad‐based
question
was
developed:
 




























































 23


For
example:
Level
O
forces
(ie.
Global/National)
include
economic
pressures
(++),
technological
 changes
(++),
political
dynamics
(+).
Level
1
forces
(ie.
Wales)
include
the
prevalence
of
a
‘sharing’
 logic
(++),
enduring
resource
duplication
(+),
extant
policy
context
(Making
the
Connections;
One
 Wales)
(+),
NHS
re‐organization
(+/‐),
inter‐organizational
politics
(+/‐),
resource
constraints
(+/‐),
 Best
Practice
(England?)
(+/‐),
Welsh
Geography
(‐),
Lack
of
performance
data
(‐),
limited
common
 infrastructure
(‐)
and
process
practice
(‐).
Level
2
forces
(i.e.
Organization)
include
organizational
 politics
(‐‐),
process
stability
(+/‐),
managerial
capability
(‐),
etc.





28



 •

Will
NHS
Wales
shared
service
arrangements
develop
in
an
ad‐hoc
or
 coherent
manner?



 Uncertainty
Mapping
 A
list
of
potential
consequences
(first,
second,
third
order)
was
identified
using
the
 key
trends
(i.e.
reduced
public
budgets,
front‐line
service
focus,
need
for
consistent
 service
quality,
etc).
Two
critical
uncertainties
(i.e.
critical
with
respect
to
their
 potential
effect
on
the
focal
issue)
were
then
selected
and
a
map
of
their
respective
 extreme
states
was
developed.
Figure
3
illustrates
the
first
dimension,
the
uncertain
 impact
of
different
levels
of
process
stability
and
interactional
maturity.

 



 
 Figure
3.
Uncertain
impact
of
process
stability
and
interactional
maturity
 
 To
illustrate
the
process;
it
is
highly
uncertain
that
WNHS
will
be
able
to
establish
a
 robust
and
consistent
set
of
performance
metrics
and
benchmarks
but
it
is
argued
 that
if
this
is
the
outcome,
then
this
will
have
a
highly
positive
impact
on
the
 coherence
of
any
shared
service
policy.
 The
second
dimension
that
was
determined
to
have
the
highest
potential
impact
on
 the
future
evolution
of
shared
service
arrangements
–
at
this
point
in
time
–
was
the
 current
WNHS
reorganisation
(see
Figure
4).
 
 


29



 
 Figure
4.
Critical
uncertainties
from
impact
of
NHS
Wales
Reorganisation
 
 Once
again
to
illustrate
the
process;
the
new
LHB
structure
will
reduce
the
nominal
 number
of
clients
for
any
arrangements
but
there
is
uncertainty
surrounding
the
 precise
impact.
In
other
words,
if
there
no
impact
on
actual
process
complexity
but
 simply
fewer,
more
powerful
clients,
this
could
represent
the
‘worst
of
both
worlds’
 in
terms
of
its
impact
on
options.
 
 Scenario
Creation
 The
final
stage
of
this
process
is
to
combine
these
uncertainties
to
help
build
 plausible
scenarios
for
the
future
of
shared
services
in
WNHS.
Figure
5
summarise
 the
4
scenarios
that
were
identified.
 





30



 
 Figure
5.
Indicative
S2
Scenarios
(+5
years)
for
Wales
NHS
 
 Not
all
the
scenarios
are
necessarily
encouraging
from
a
policy
formulation
 perspective
(e.g.
“The
patient
didn’t
recover”)
but
they
do
indicate
potential
 outcomes
that
ought
to
at
the
very
least
figure
in
ongoing
reflection.
 





31