AGENDA ITEM NO. 11
1.
REPORT TO:
Executive Board
REPORT NO:
CE / 20 / 09
DATE:
1 December 2009
LEAD MEMBER:
Councillor Aled Roberts
(Corporate Leadership and Children)
LEAD OFFICER:
Chief Executive
CONTACT OFFICER:
Roger Davies (Tel: 292272)
SUBJECT:
Workstyle Transformation Study Recommendations
WARD:
N/A
PURPOSE OF THE REPORT
To provide members of the Executive Board with the findings from the Workstyle
Transformation Study recently undertaken with BT. In parallel with the
consideration of the study findings, the report serves to provide options on how to
take forward the principles contained within the study.
2.
EXECUTIVE SUMMARY
2.1 Wrexham County Borough Council have been working with colleagues from
Flintshire County Council and Denbighshire County Council to look at the
potential for agile working in co-operation with BT. The study set out to include
estimates on the level of potential adoption that each Council could achieve as
well as benefits, costs and risks for the implementation of the flexible work styles.
2.2 The investigation was based on a method developed by BT – called the Work
Style Transformation Study. The Work Style Transformation Study was designed
to assess the potential and viability of large scale agile working. It consisted of
several financial, cultural and technological evaluations.
2.3 The workstyle evaluation exercise highlighted that of the 3953 people in the
project scope, up to 2180 people could work in new ways. However, for a variety
of reasons, both from a business and employee perspective, BT’s model
assumed that not all of the people in scope would be able to transition to work in
new ways. Therefore, a base case was established by BT and used to project an
adoption rate which was realistic, moderate and achievable. The Wrexham Base
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Scenario therefore assumed that 1020 employees could adopt one of the new
agile work styles – approximately 26% of the 3953 people in the original scope of
the business case.
2.4 The initial investment for implementation is highest in the first year of adoption,
although remains relatively steady in the years following. First year
implementation costs stand at just under £2.5m with continuing costs in future
years standing at just over £2m. The total cost of implementation, according to
BT’s five year adoption model, stands at £10.8m. However, taking the cumulative
cost benefit figure, positive cash flow is not achievable until year 4, with an
estimated figure of £184,849.
2.5 Following on from the completion of the Workstyle Transformation Study, a
debate on the options for future consideration of the principles now needs to take
place. The options outlined in this report have been considered and debated at
the final project team meeting and at SMT.
3.
RECOMMENDATIONS
3.1 That the Executive Board note the content of the attached Workstyle
Transformation Study Business Case proposal from BT.
3.2
That the Executive Board endorse the Strategic Management Team
recommendation of Option 2 in ensuring the principles contained in this
study are taken forward.
REASON FOR RECOMMENDATIONS
To ensure the principles contained in this study are taken forward and any
benefits from future accommodation reviews are realised. Colleagues from
Flintshire County Council have also considered the findings from their business
case proposal and have adopted a similar proposal to ensure the principles of the
business case are carried forward.
Isobel Garner
Chief Executive
4.
BACKGROUND INFORMATION
Aims of the Study
4.1 The concept of agile working enables people to make use of a variety of
workplace options and locations, for example, utilising hot desks, home working
and mobile working. Agile working is about making the best use of the most
appropriate workplace locations to enable people to do their job. In reality, a redefinition of the term flexible working.
4.2 Wrexham County Borough Council have been working with colleagues from
Flintshire County Council and Denbighshire County Council to look at the
potential for agile working in co-operation with BT. Between December 2008 and
June 2009 an agreed business case proposal was developed encompassing
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joined up analysis into the specific costs, benefits, risks and timelines for the
introduction of agile working.
4.3 The study set out to include estimates on the level of potential adoption that each
Council could achieve as well as benefits, costs and risks for the implementation
of the flexible work styles. The potential benefits were to be estimated for
productivity gains, cost reductions, higher property utilisation, reduced travel and
property rationalisation. The proposed costs were to be estimated for new
technologies, processes, training, management and facilities required to
implement flexible work styles.
4.4 In terms of the format of the study, Flintshire were the lead authority for the
development of the business case and were the main focus of the detailed data
gathering and analysis. Wrexham County Borough Council participated in the
workshops, surveys, presentations and interviews which formed part of the study
approach.
4.5 The investigation was based on a method developed by BT called the Work Style
Transformation Study. The Work Style Transformation Study was designed to
assess the potential and viability of large scale agile working. It consisted of
several financial, cultural and technological evaluations. As well as estimating the
potential benefit, the Work Style Transformation Study also estimated the costs
and investments required to achieve the Council’s vision for agile working.
4.6 The development of the Business Case was co-financed by Flintshire, Wrexham,
Denbighshire and BT. Wrexham's contribution to funding amounted to £5k which
was accommodated from within the Chief Executive’s budget.
Workstyle Transformation Study
4.7 A workstyle evaluation exercise was completed by 3 Council departments in
Wrexham (Adult Social Care, Transportation and Asset Management and
Learning & Achievement). This exercise aimed to identify which job roles could
potentially adopt the new work styles defined as Flexible, Mobile or Home. The
individual roles within each department were identified from the Council’s HR &
Payroll Systems. A detailed description of each work style was provided by BT
during this process.
4.8 All the roles within the departments were identified and allocated a work style of
Fixed, Flexible, Mobile or Home. Guidance was given to the departments to
complete the exercise. The objective was to look at the potential of the role and to
remove the constraints by current limitations such as technology, access to data
and/or historic processes.
4.9 The roles were then mapped to the number of people in posts and the associated
number of Full Time Equivalents (FTE). A number of roles are fulfilled by people
who work part-time or job share, therefore there is a distinction between the
number of people employed by the Council and the number of budgeted FTE’s.
4.10 The objective of the mapping exercise was to inform the business case as to the
maximum possible number of people for each defined work style. This data was
then used within the business case to model the likely adoption rate, based on the
department’s view of what roles fit within each category. Also, for the purpose of
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the study, it was decided that the teaching staff were not to be included in the
scope of the business case. The revised total workforce (excluding schools based
staff) used in the study was therefore 3953 people.
4.11 The workstyle evaluation exercise highlighted that of the 3953 people in the scope
of the project, up to 2180 people could work in new ways. However, for a variety
of reasons, both from a business and employee perspective, BT’s model
assumed that not all of the people in scope would be able to transition to work in
new ways. Therefore, a base case was established by BT and used to project an
adoption rate which was realistic, moderate and achievable. The Wrexham Base
Scenario therefore assumes 1020 employees could adopt one of the new agile
work styles – approximately 26% of the 3953 people in scope of the business
case.
4.12 BT have lowered the estimate to reflect the notion that employees have a choice
as to whether they adopt new work styles or not and to ensure that unnecessary
costs related to the volume of adoptees are avoided unless they are required at a
later date.
4.13 After the workstyle evaluation exercise, a staff travel survey was carried out with
all staff to assess the carbon footprint of people travelling to and from work, and
also between Council buildings for meetings and conferences. A ‘Day in the Life
of’ survey was also undertaken with staff from the three departments taking part
in the overall study to see what different activities were carried out over the
course of a working day. The results from both surveys have been accounted for
when carrying out the benefit analysis for the business case.
Benefits Analysis
4.14 BT have in the business case, identified five areas of cashable benefit
contributions, of which the greatest contributor is efficiency gains realised as
employees transfer from being fixed workers to one of the new work styles. BT
also proposed that significant cashable benefits can be realised from property
disposals and the consequential reduction in building operational costs.
4.15 In providing the business case, BT have also identified 28 cost drivers. The top 10
costs represent 90% of the overall estimated costs for implementation. In
producing cost estimates the business case has endeavoured to be as complete
as possible based on the information available at the time of the report
production. Where possible BT has used verifiable facts but, inevitably, some
costs are based on assumptions or estimates.
4.16 It should be noted that many of the costs are variable depending on the level of
adoption of Council employees for the new work styles. Any changes to the level
of adoption as described in the base scenario or any changes to the assumptions
used to determine estimates will have an impact on the overall cost of the Work
Style Transformation Programme. Further information on the estimated costs
provided by BT can be found by referring to the business case at Appendix I
(pages 3 & 4).
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Financial Conclusions
4.17 The initial investment required for implementation is highest in the first year of
adoption, with lower but relatively steady levels required in the following years.
First year implementation costs stand at just under £2.5m with continuing costs in
future years standing at just over £2m. The total cost of implementation,
according to BT’s five year adoption model, stands at £10.8m.
4.18 According to BT’s Workstyle Transformation Model, the cost benefit case is
positive with an anticipated 5 year return on investment of 39%. The ongoing
annual net benefit, from year 6 onwards, is approximately £4.6m as support and
infrastructure costs reduce after the initial 5 year implementation period. We
anticipate the ongoing costs to be approximately £1.8m. The benefit will continue
at the year 5 level of £6.3m.
4.19 Cash flow is however negative in years 1 and 2 owing to the upfront investment
required to establish a support environment for the new work styles. However, BT
suggested that various stratagems can be deployed to minimise the negative
cash flow including carefully controlled budget expenditure policies, spend to save
mechanisms and possibly innovative arrangements with commercial suppliers.
4.20 However, taking the cumulative cost benefit figure, positive cash flow is not
achievable until year 4, with an estimated figure of £184,849. Further information
on the financial conclusions of the business case can be found by referring to the
business case at Appendix I (pages 5-7).
Further information
4.21 The Workstyle Transformation Study has followed Wrexham County Borough
Council’s Project Management Code of Practice (PMCoP) and a copy of the
project mandate, project initiation document and initial risk assessment are
available for scrutiny.
4.22 A project team was established early on in the inception of this project to ensure
data collection took place and that the project progressed successfully. The
project team have met on a number of occasions and have robustly challenged
the development of the business case.
4.23 The Project Manager, Performance and Improvement Manager and the Audit and
Technical Manager met on a number of occasions to challenge the findings
contained within the business case. This challenge was necessary to ensure the
accuracy of the data contained within the business case. A total of seven editions
of the business case were provided by BT and it was this lengthy period of
challenge which led to a delay in the completion of the study.
4.24 The receipt of the financial business case from BT signals the end of the
commissioned work and the end stage of the Workstyle Transformation Project.
4.25 Following on from the completion of the Workstyle Transformation Study, a
debate on the options for future consideration of the principles now needs to take
place. The following options have been considered and debated at the final
project team meeting and at SMT. The options on how to take forward the
principles contained within the study include:
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Option 1
Option 2
Pursue debate on adoption based on the BT
Financial Business Case.
Adopt the principles of the study
findings.
Issues:
 Procurement of relevant external partner
to assist with implementation.
 Access to significant amounts of
investment funds.
 Capacity to ensure project management of
adoption.
Issues:
 Implemented over a longer period of
time.
 Smaller scale projects, pockets of
improvements already taking place
in departments, e.g. Public
Protection.
 Less upfront investment required.
 Not led by an external partner.
 Not ‘big bang’, instead carried out
at our own pace with specific pilot
projects.
 Possible collaboration where
possible with study partners
Flintshire and Denbighshire.
4.26 During the life of this project, the Chief Transportation and Asset Management
Officer has initiated an ‘Accommodation Review’ Group to consider future office
moves and the realisation of benefits from any likely future actions. Linked to this
in terms of relevance, are programmed improvements in IT infrastructure. With
these existing developments, the project team and the Strategic Management
Team felt that Option 2 is the more feasible approach in ensuring the principles of
this study are realised. This recommendation has the support of the project
sponsor and project manager as well as the Chief Transportation and Asset
Management Officer and Chief Information Systems Officer.
5.
CONSULTATION
5.1 Consultation with the Unions have taken place. The project manager met with
Trade Union representatives to brief them on the project. Union representatives
from Flintshire County Council were also present at the inception meeting. The
findings report presented to SMT on 18th November 2009 has also been shared
with Union Representatives in Wrexham.
6.
SCRUTINY COMMITTEE COMMENTS
6.1 N/A
7.
IMPLICATIONS
7.1 Policy Framework – there are no policy framework implications in this report.
7.2 Budget – there are no budget implications in this report. Any budget implications
are considered as part of specific project work.
7.3 Legal – there are no legal implications at this time.
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7.4 Staffing – there are no implications on staff at this time.
7.5 Risks – there are no risk implications in this report. A risk assessment was
carried out as part of the project management aspects of this specific piece of
work.
7.6 Equalities – there are no Equalities implications as a result of this report.
BACKGROUND PAPERS
LOCATION
WEBSITE INFO.
http://www.internal.wrexham.gov.u
k/intranet/departments/chief_exec
/agile.htm
CE / 16 / 08
Workstyle Transformation
Business Case Proposal
CE / 17 / 09
Workstyle Transformation
Study Recommendations
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