‘Spending Cuts’. Not the favourite phrase in Departmental lexicons, but one that is likely to re-emerge in coming months. A recent Reuters article notes the tools available for deficit reduction are largely raising taxes and spending cuts. The Office for Budget Responsibility notes, “Faced with these post-pandemic pressures, the Government has so far cut more than £15 billion a year from departmental resource spending from 2022-23 onwards, setting up a challenging Spending Review later this year”.
Our experience demonstrates that finding new areas to deliver further efficiencies will be challenging after recent spending reviews ‘baked in’ a round of cost reduction measures. This could be complicated as some departments start to ramp-up on new spending - including aspects set out in the Integrated Review.
This case study demonstrates that new efficiencies can be found by team empowerment and in the dispersed working arrangements in place during and beyond Covid. Large spend to save programmes, including those that use digital transformation to unlock efficient ways of working, will continue to be valid; but equally a Lean Innovation Pilot could give a roadmap for incremental improvements.
Context
A HM Government Procurement Department is leading the way in unlocking the potential of their own teams to improve their services and make savings.
The Department had a Spending Review 2015 (SR15) efficiency savings target but, having started the cost saving journey in 2016, they were losing momentum in 2020. New ideas were also hindered by the Covid lockdown when most of the department were unable to visit the office. Less than 25% of employees initially had the technology to work productively from home.
It was clear that new impetus and new ideas were required. FY20/21 was the last chance to close the £1.0m gap to the £5.0m SR15 efficiencies target and Covid did actually allow department team members some additional thinking time.
The client knew that hidden within their corporate services teams was huge potential that would enable them to work more efficiently, effectively, and smarter. Using management consultants was one possible way of gaining new methods to unlock the efficiencies pipeline. However, there were some concerns:
A small team of MI-GSO | PCUBED consultants were already working within the Procurement Department on a wider business transformation challenge, and had tabled a number of improvement ideas. The Department agreed to a proposal to begin a small pilot led by the same team on the mutual understanding that the work would provide the Department with a taster of what it could be like if they made the improvements themselves.
Step 1: Identifying the Opportunities
MI-GSO | PCUBED applied their unique Lean Innovation methodology. Lean Innovation focuses on identifying process improvements within projects which can translate to savings in time, cost, and effort. The methodology blends three proven business improvement disciplines; Design Thinking, Lean Start-up and Agile at Scale.
The pilot focused on Phase 1 of the methodology, and a series of collaborative ‘voice of the team’ workshops quickly established a list of areas where improvements could be made. Three departments were involved in the process and 115 unique ‘pain points’, areas of inefficiency or pain in the process, were identified. Departmental leadership ranked and prioritised these pain points to identify the first area to start making improvements.
Step 2: Getting Going Remotely
At first it was difficult. During the early workshops, the only common platform available to the team was a telephone conferencing facility. This highlighted what could be done on the phone and what couldn’t.
Lean Innovation focuses on identifying process improvements within projects and operations which can translate to savings in time, cost, and effort.
“We’ve done many workshops face to face in an office, but this was a very different matter doing it remotely. Participants hadn’t yet familiarised themselves with online collaboration tools; we learned a lot from working with the department in this way,” said Kent Thomson, MI-GSO | PCUBED Lean Innovation consultant.
The facilitation approach had to develop. Thomson recalled, “Normally putting someone on the spot to make a contribution isn’t encouraged. However, on a telephone call where we are sharing visuals and not faces, it’s needed to avoid people talking over each other or not being able to contribute.”
Other collaboration platforms were forthcoming, but the methodology's essence is all team members having a voice to put forward their efficiency ideas.
Step 3: Designing Solutions
The pilot proceeded to analyse the root cause of issues and to get started on making some improvements. During a collaborative workshop, MI-GSO | PCUBED encouraged the team to envision possible design solutions. From the 115 pain points, 10 solutions were identified. The solutions were presented at a virtual decision-making panel where the departmental leadership were walked through the problem-solving logic and the solutions with a clear roadmap of improvements. The team got on-the-spot approval for their solutions from leadership with a clear plan of putting them into action.
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