Comments

DAMESATHOME@YAHOO.CO.UK
send the Dame your information, discretion assured.
Comments are welcome but do not necessarily reflect the view of the Dame.
Offensive/inappropriate comments will be deleted and the poster banned.

Thursday, 21 June 2012

TRIBOROUGH DANGERS

 
An officer has forwarded this interesting assessment by a resident with years of experience leading international companies and managing complex industrial integrations. It has gone to all cllrs and certain officers
It is an eye opener-except to the oblivious and risk taking council..... 
The Dame comments, " H&F & WCC have new, inexperienced leaders.
RBK&C has one well past his well past his sell by date; with no business experience and his time spent with the Local Government Association...dangers ahead.....
 

Dear Councillor
Cllr Buckmaster's Scrutiny Report about the Tri Borough will be discussed at the main Council Meeting next week and I am writing to urge caution. Having been involved for many years in mergers, acquisitions and integrations in the private sector, the alarm bells are ringing when I consider what is going on. The first challenge is always that Chairmen like to run their own company and are reluctant to give up power. But any organisation can only serve one "brain" otherwise it becomes dysfunctional. We are proceeding with three Leaders and three Cabinets. The Tri Borough FAILS THIS TEST.
It is also clear from the result of the last local elections that Hammersmith will revert to Labour the next time around. This is currently the 'elephant in the room' that nobody seems prepared to discuss.

Cllr Freeman recently wrote in my Resident Association Newsletter (The Campden Hill Residents Association) that the Tri Borough foreshadows the merger of the three Boroughs into a single Borough i.e. One Leader, One Cabinet, One Electoral Services department and One Accounts (collection of taxes) Department. This is the necessary first step before any integration arrangements can be successfully attempted. In the meantime good preparation can be put in place in two important dimensions:
(i) benchmarking of service outcomes and efficiencies between the three Boroughs. This is a powerful source of learning and improvement
(ii) planning (and perhaps implementing) a common IT system across all three Boroughs in anticipation of a merger into one Borough

No modern organisation can be aligned or function without a common IT system. And it is pointless to attempt organisation change before this is put in place.


The Buckmaster Report

The Terms of Reference are flawed because they failed to seek the views of persons, organisations and consultants with experience and track records of mergers and integration. At a single stroke, the enquiry decided that it would not mine the rich seam of experience that is available to be tapped.

The report also notes that it chose not to address the implications of any change of political control that may come about


Learnings
My experience at Board level of integration work taught me and my colleagues a number of lessons

(i) The Chief Executive selected to run a merged operation has to be recruited from outside the shareholders. If he comes from one of the hosts there will always be suspicion from the others and authority will be undermined and then it breaks down. The Tri Borough FAILS THIS TEST.

(ii) Profit maximisation or cost minimisation cannot be the objective of an organisation. Both are by products of actions and strategies. If costs are too high then the objective should be, for example, to save money by taking out activities (eg Holland Park Opera subsidy) or work in a way that benchmarks against best in class (eg number of staff per £ of service delivered). The Tri Borough FAILS THIS TEST

(iii) If costs have to be reduced by re engineering an organisation, then lines of control have to be shortened and power concentrated. But we are building a shared power organisation and distributed organisation. The Tri Borough FAILS THIS TEST

(iv) If a new way of delivering a critical function (such as an accounting system) is to be introduced, then the old system needs to run in parallel with the new system until the new system demonstrates that it works. It never does first time. Tri Borough implementation arrangements (Hosting) FAILS THIS TEST

(v) Merger and integration is high risk. There is no point contemplating it unless savings of ca 30% can be demonstrated on paper (and empirically only about 10% will be obtained). The three Boroughs spend about £2 billion. 30% is £800 million. But Tri Borough savings were projected to be ca £20m to £30m at the outset and now £40 million is being trumpeted. Paltry in the scheme of things and they will be swept away by risk. The Tri Borough FAILS THIS TEST.

(vi) The personality of the Chief Executive needs to be understood and a performance/reward framework put in place to match his behaviour to the desired outcome. The dual appraisal arrangement by K&C and Hammersmith is a classic "divide and rule" trap. The Tri Borough FAILS THIS TEST

(vii) The Chief Executive needs to report to a single master. Mr Myers will report to two masters. The Tri Borough FAILS THIS TEST

(viii) Shareholder/owner sanctions over the Chief Executive need to be symmetric. Hammersmith has rights to give Mr Myers three months notice. K&C is open ended. The Tri Borough FAILS THIS TEST.

(ix) Shareholder/owner drivers need to be aligned. Westminster and K&C have guaranteed Conservative majorities. The Leaders are on a long leash. Hammersmith is a marginal council (Conservatives in survival mode). The Tri Borough FAILS THIS TEST

(x) Shareholder/owner constituencies need to be aligned. The demographics of Hammersmith are fundamentally different from K&C/Westminster. The Tri Borough FAILS THIS TEST

(xi) The Chief Executive and those appointed so far to senior positions have no joint venture experience. They will have to learn on the job while the expectation will be immediate delivery of cost savings and the maintenance of service levels. The Tri Borough FAILS THIS TEST

In my experience any integration programme will fail if any one of the rules above are broken.

In the private sector the sanction is bankruptcy if the choices/decisions are wrong. The players lose their jobs and their investment. In the public sector there is no such sanction, just the bottomless pit of tax payers money to fund whatever happens to be in fashion. The only safeguard is wise and inspired Leadership.

A Resident





13 comments:

  1. This must have been written by Donald Cameron. I think he was the one who suggested at the very outset that a merger of this complexity needed a consulting firm involved. As usual, Cockell, ignored his advice and we now see trouble ahead as officers and cllrs flounder around

    ReplyDelete
  2. Whoever the author is, these are all wise words.

    ReplyDelete
  3. Council Officer21 June 2012 at 17:09

    Deep Throat from the hub of H&F Town Hall tells me that in an attempt to bolster the Conservative's rapidly slipping hold on the borough, a reduction of 3.5 per cent in Council Tax is being considered for H&F. This will put considerable pressure on the funding of Tri and Bi-Borough services.

    ReplyDelete
  4. It's time for residents either to head for the hills, or take their earliest opportunity to rid themselves of councillors who sat silent while this appalling scheme became a reality; it seems without professional oversight.

    We will all pay the price for this and for electing and re-electing the spineless and self-serving Hornton Street gang.

    ReplyDelete
  5. It's a catastrophe, residents have been led into this like lambs to slaughter, by these idiot councillors.

    They should pay from their own pockets for this utter mess and for the disasters that are about to hit the headlines because of stealth cuts to services.

    Shame on them all.

    ReplyDelete
  6. This is a classic example of Cllr Cockell cooking up nonsense to get himself editorial coverage and to get noticed by those that he wants to impress. He has masterminded an orchestrated PR programme to grab attention and kudos for himself. The latest puff was on 18th June when the K&C press office put out a release announcing that tri Borough is on course to save £40 million by 2016. The next day Eric Pickles is saying "this is the way to go".

    A self serving game of "aren't we clever". But it is all pie in the sky

    ReplyDelete
  7. Cockell has been using and abusing the Borough for personal gain for much too long

    ReplyDelete
  8. Angry Resident22 June 2012 at 06:58

    2016 is a safe target. The reptile will be long gone by the time the shit hits the fan

    It is a giant and incompetent ego exercise

    ReplyDelete
  9. very cleverly the Dame has miss captioned the pics...

    ReplyDelete
  10. Im confused. Is H and F planning a reduction of 3.5% for 2013-14 or are they deciding to send reduce Council Tax for this year even further and send everyone a cheque in the post?

    ReplyDelete
  11. in 2013/14 I understand

    ReplyDelete
  12. So what is such a shock about that then if its for next year? Didnt Greenhalgh promise 8 years of reductions in 2006.

    I can understand that people think its mad to reduce by these amounts. But isnt this exactly what they promised when they were swept to power.

    ReplyDelete
  13. 06.55, is it £40m total, or £40m a year, as stated by the Press Office, which makes £120m in three years? Does anyone know and is it relevant anyway, given that it is utter twaddle?

    'A progress report published Monday 19 June reveals that Hammersmith & Fulham, the Royal Borough of Kensington and Chelsea and Westminster City Council are on track to save £40 million a year by 2015/16 by combining services and management costs.'

    ReplyDelete

Comments are your responsibility. Anyone posting inappropriate comments shall have their comment removed and will be banned from posting in future. Your IP address may also be recorded and reported. Persistent abuse shall mean comments will be severely restricted in future.