Andrew Blake-Herbert on the trials and merits of Project Athena

Initially at Herfordshire County Council Andrew Blake-Herbert moved from there to head finance and support services for social care at Hillingdon and then Slough where he became director of resources. In 2009 he became director of finance and commerce at the London Borough of  Havering. Since 2010 he has been leading on the implementation of Oracle as part of Project Athena, which has worked to modernise the back offices of six London boroughs.

Room 151: Tell us about Project Athena

Andrew Blake-Herbert: I led the Oracle stream of the project (we have one stream for each platform). It has been ahead of everybody else and has now got to the point where the six initial councils are all working together to take forward an initial instance of Oracle with the other, tier two councils of Bexley, Bromley, City of London Corporation, City of Westminster, Hillingdon, Hounslow, Kensington & Chelsea, Kent County Council, Kingston-upon-Thames, and Newham following behind. Havering decided to take forward and implement Oracle on its own at first. That’s partly because when I was at Slough we were part of the Slough, Northampton and Cambridge local government shared services work as it was then. You only go as fast as your slowest partner, and I’ll leave it there, so when austerity came along and I had moved to Havering I decided we would do it first and then look to partnership afterwards. I had learnt a valuable lesson from my previous experience with shared services.

Particularly in times of austerity when you’ve got to deliver savings quickly we wanted to do the right things for Havering, but we did always have an eye on the fact that Athena was the right thing to do as a wider group. So we have led the Oracle group with a view to bringing together the London Oracle users and anyone who wanted to move to Oracle with a view to creating that one instance of it all being used in the same way to take down back-office costs.

It was about taking away bureaucracy and giving managers the tools and skills to do what they needed to do and save back-office costs. You want to protect front-facing services, not by shutting parks and libraries, but by making your organisation as lean and mean as you possibly can. I joined Havering in September 2009 and we put together the business case for implementing the Oracle Enterprise Resource Planning solution that Autumn and went out to the market in January for a systems integrator to support us. Cap Gemini won that and we began the implementation in June 2010, we went live with the Oracle functionality on April 4, 2011.

Room 151: What does it do?

ABH: It changed the systems, the processes and the way the council was set up, so in the old ways we had some services that were devolved in departments and some that were centralised. HR was a single service, for example. We moved to what we called our internal shared service centre where we split out transactional and operational services. Transactional was payroll, raising invoices, paying invoices, recriuting people, and operational was support managers, be it financial advice, procurement advice or HR advice, for example. The final element was strategic, which we kept separate. We ended up massively reorganising the council. People had come to the council to fulfill very specific roles and had their own views about their professions and where they wanted to go – it was a very large change for them. As part of the ERP functionality we rolled out as much self-service as we could, we got rid of all the paper-driven processes that we used to have and used the information technology to its full potential so it workflowed things around the council. We centralised all the old administrative roles and in the end we took out 88 posts.

Room 151: What sort of savings does that make for Havering and the six other councils?

ABH: We are making just about £2.5m in savings per year in the back office. Year one was £1.5m and then it was a further million in year two and now we are into a steady period it’s £2.5m a year. The harder part is that you obviously can’t take our savings and extrapolate them up because everyone is coming from a different starting point. But there are benefits across the six councils, streamlining of processes, and each council does have a savings figure. Ultimately where we would like to go to, having got the technology set up, is a shared service, whether that is two or six of the boroughs we just don’t know at this point. What the structure of it will be like, one north of the river, one south, different councils doing different bits of the functionality, we just don’t know. That’s the desire though, to provide as much support to as many councils as we can.

Room 151: Does the Tri-borough of Westminster, Hammersmith and Fulham and Kensington and Chelsea share a platform do you know?

ABH: They don’t have a shared platform yet. Westminster are running a process at the moment on behalf of a number of councils including their tri-borough partners, looking at somebody to provide this type of back-office function. I believe they’ve recently gone to the market for it. It’s about who can provide it and at what cost. For us it’s how we drive the savings out ourselves and get the best possible value for money internally.

Room 151: What did you find to be the advantages and pitfalls of joint commissioning?

ABH: The hard part whenever you are working in partnership is trying to get something that reflects everybodies wishes and desires. It’s not easy. Making sure you invest the time upfront in that planning phase is really important – you have to talk to everyone and involve them. I wouldn’t say it has been smooth. I wouldn’t say we expected it to be either, but the important thing was at the top level, we all had committment and buy-in to what we were trying to do collectively. Lambeth led the procurement process on behalf of the six councils. We divvied up the work people had to do as part of that and went through an open process with the market. ‘We got through it’ would probably be the best way of phrasing it. At times it was painful and tortuous.

Room 151: You had the previous experience of shared services though, were some of the other councils less prepared for these kind of difficulties?

ABH: Absolutely. There’s a lot in the procurement process and also the changes afterwards that prove difficult. Change for individual councils is big, the technology should be the easy part.

Also important is the future procurement. In terms of Oracle and Athena which Nathan Elvery at Croydon will take forward, there are tier two councils coming on board who will benefit from a system that is already built and works for six London boroughs and so will work for ten or twelve or however many we end up with. They will be able to come in without large costs to themselves.

Having a proper procurement system that we are all using is a great benefit. We’ll all have really good data on the goods and services our councils are buying; whether they are on-contract or off-contract; whether we should be getting contracts in place for them for the future, the timing of contracts and when they are coming to an end for each of the councils.

It all means we can start to do some joined-up procurement and get better value for money. For Havering I could give you an example where we set up to take a million pounds worth of strategic sourcing savings out. The hard thing about doing that collectively is not knowing the starting point for each authority and collectively who is getting a better price than anyone else and therefore collectively what we can do. You also have the issue about the timing – when you go to the market and what providers are prepared to offer – so it is difficult to put a figure on savings from collective procurement.

Room 151: So what happens next?

ABH: We have this four year framework from July 2012 to 2016. At the end of the four years if it’s still only six councils we have the benefit of being on one platform, using it one way when we retender. If other tier two councils have come on board then we’ll have more clout to go to the market with and to help negotiate a better price.

Room 151: What main lessons would you share from the experience so far?

ABH: You’ve got to have like-minded people who want to do it for the right reasons and who come into it with an open mind. All the organisations have to realise that for some people in their organisation, they’re not going to end up doing the job at the end of it that they were doing at the beginning. Openness and honesty around that is really important. Trying to get people onboard that are excited about it is important, people that know that they could end up doing a different role. Whenever it comes to joint working of this nature there is a level of selflessness required but there are a lot of people who see it as an exciting opportunity and the right thing to do so they want to be part of it. You will always have people nervous, seeing potential impacts and consequences for themselves, but it is about trying to motivate them in the right way to take it forward.

There are some real issues of significant change for an organisation. Getting rid of the paper-driven processes wasn’t just about my services and the services I run, it was about getting them out to street care, to housing etc, a myriad of different services who all operate in their own way. We created ‘super-users’ who went back to their services talking about what we were doing and why we were doing it. The other two key bits for me are about purpose and selling that vision at the beginning, showing people what benefit they are going to get from this.

The final part is that obviously the financial climate is different now. If we’d tried to do this ten years ago we probably would have encountered more resistance. In the current climate where it’s about protecting front-facing services that gives a real incentive for change. That’s what we’ve said to people at the end of it: it may have been painful, the change may not have happened overnight and we may still be working on it but it has meant that we have taken £2.5m out of back-office rather than having to take that from services that directly face the public.

Room 151: Do you think that that kind of management forms part of the ‘new’ financial director’s role going forward?

ABH: Finance director roles have changed: my role is finance and commerce so I have been responsible for asset management and IT and HR and so quite often the role at that level has changed anyway, but it is absolutely true that as a director these days it’s not just about looking after your service, you’re a corporate director of the organisation as a whole and you have got a responsibility not just to support your service but to support the running of the council. As part of that it’s vital in the current climate that you look at the cost of other peoples’ services as well as your own.