Cabinet Member for Corporate Relations Proposal for new customer experience October 2015 Report by the Executive Director Residents Services and the Director of Customer Services Ref No: CR05(15/16) Key Decision: Yes Part I Electoral Division: N/A Executive Summary In considering Future West Sussex plans, the Council has identified improving the customer experience as a key improvement programme. The attached proposal is focused on meeting this aim. It sets out a model for a central, professional customer service for the Council. The model will be delivered by: Establishing the function, investing in its infrastructure and giving it responsibility for the delivery of some customer activities currently managed by services; Continuing to use the Capita contract to provide the contact centre and examining opportunities for any future telephony activities to be transferred where appropriate; Investing in the initial enabling technology that is fundamental to delivering the required demand reduction and channel shift in order to deliver efficiency. It is further proposed to pilot some revised arrangements in selected face to face settings to determine the most suitable models for future provision. The programme delivers a range of benefits for customers, particularly improving ease of access and increasing the rate at which their queries can be resolved. In doing this, the Council will also be able to be more efficient, primarily by reducing incoming demand or dealing with it using digital channels. The programme requires an investment of 1.5m over three years and has profiled delivery of 2.3m cashable savings to be delivered by 2017/18. Recommendations (1) That the development of customer services detailed in the proposal in Appendix A, using the contractual arrangements with Capita for telephony based customer service and creating an in house function for other services is approved. (2) That the proposed investment of 1.5 million to 2017/18 is agreed;
(3) That the proposal for piloting new models of Face-to-Face services described in Appendix A is approved. 1. Background 1.1 In November 2014, the Customer Excellence Board (CEB), chaired by the Cabinet Member for Corporate Relations, agreed the objectives of the Customer Experience Programme: The County Council will provide an excellent customer experience The County Council s users will receive a consistent, connected and easy to use service The County Council will improve customer satisfaction and make it easier for staff to deliver a great customer experience across all channels. 1.2 At that time, the Cabinet Board considered an outline business case for customer services and requested that the customer experience programme bring forward a full proposal. 1.3 Both Cabinet Board and CEB have supported the proposal which was subsequently developed. This report outlines that proposal and seeks a Cabinet Member decision to proceed to implementation. 2. Consultation 2.1 The development of the outline business case in November 2014 and subsequent work to deliver this proposal has included consultation and engagement with the following: Cabinet Board (November 2014, March and July 2015) Lead Cabinet Member in all areas Member Development Days (October 2014, February, June 2015) Corporate Leadership Team (CLT) Senior Managers in key services affected Corporate Management Group Staff in services, including work on values and customer journeys Focus group with customers Dialogue with Unison 2.2 Cabinet Board and CLT have both endorsed the proposed approach noting the scale and complexity of the programme. The Performance & Finance Select Committee considered the proposal at its meetings on 3 September 2015 and 2 October 2015, and supported the proposals. 3. Proposal 3.1 The proposal, described in more detail in Appendix A, sets out a model for a central, professional customer service for the Council. It proposes the scope of services to be included, the investment required to drive improved customer experience and sets out the benefits.
3.2 Service delivery approach It is recommended that the Council continues with the current approach to service delivery. Capita currently provides a large proportion of initial contact through the contact centre. It is proposed to build on this by transferring appropriate related activities in phases and enhancing this with a programme of complementary digital offers. This will drive the necessary changes to achieve a desired increase in first contact resolution and can be supported by a performance management regime. The remaining services would be delivered through a core Customer Services Function (CSF) that would be created over 18 months, followed by a rolling programme of continuous improvement work. This is a far reaching and challenging transformation programme. The implementation and investment required reflects the strategic and long term nature of the programme. This recommendation also recognises that there is concurrent activity taking place on the reset of the Capita partnership contract. It makes both commercial and strategic sense to continue on a known path whilst that wider consideration takes place, leaving open a number of future opportunities for further partnership working. This does not preclude any further development work on outsourcing, trust models, joint ventures or other arrangements that may be desirable. At this point, there is not a clear strategy in this area; and so it makes sense to develop this in order to inform any alternative delivery options in the future. 3.3 Delivery of Benefits The purpose of the Customer Experience programme is to enable the Council to deliver excellent customer services (consistent, modern, joined up, easy to find and use) to all customers (residents, visitors, businesses, partners and colleagues). This will be achieved by driving down failure demand and increasing channel shift. The programme delivers a range of benefits for customers, particularly improving ease of access, increasing the rate at which their queries can be resolved and generally providing a slicker and quicker level of service. To create a true single front door requires a significant shift in the way in which we will carry out our activities and needs to be underpinned by shift in thinking which is more subtle and takes longer to embed. The programme delivers efficiency benefits in phases in a range of ways, primarily by reducing incoming demand or dealing with it using digital channels. This approach enables a reduction in resourcing as the demand from our customers changes over time. This proposal sets out the first phase of implementation and how savings of 2.3m will be achieved by 2017/18. Further savings remain to be delivered by later activities such as the wider deployment of a revised Face to Face offer which may reduce the need for office space, realisation of savings through the Capita contract and bringing more activity into the Customer Service portfolio.
3.4 Investment & Implementation This proposal is dependent upon a wider case for investment in a new technology platform for the realisation of the later years savings. This platform offers benefits far wider than simply enabling the customer experience programme. It seeks to build a basis for a whole council approach that will enable much greater integration. Much of the later savings delivery and realisation of improved customer experience will rest both on the implementation and correct use of new technology and a reengineered set of customer focussed processes. Because of its wider, strategic significance for the Council, the proposed technology framework for the future will be considered separately by Cabinet Board later this year. This proposal outlines only those short term investments that are required to deliver service improvement in the short term (18 months) through the delivery of channel shift and failure demand reduction. It is key that this is seen in this context, providing the building blocks for later development. Underpinning the structural, process and technological changes is a fundamental programme of cultural change one that sees a dynamic approach to continuous improvement and systems thinking in examining the value of every process and critically appraising the effort vs. outcome from a customer perspective. The programme includes a savings and investment profile that spans a number of years recognising that the impacts of channel shift and demand reduction will take time to take hold and that any service rationalisation can only follow a period of re-design. This will increase the engagement with services but much of this will need to be led by the services themselves going forwards. 4. Alternative Options Considered 4.1 Three options were considered as proposed solutions. The options considered were to: 1. Fully outsource customer services to an external provider 2. Provide the service as an in-house service provision (which may or may not include the in-sourcing of relevant services currently provided by Capita) 3. Continue with current approach, with the most suitable elements of the service provided externally. 4.2 In considering the options, the programme team carried out a high level options appraisal. This took into account a number of strategic considerations: The proposal is based on a long term vision of a centralised, multichannel customer services operation. This is not simply a call centre it requires the integrated management of all contact channels, whether online, telephone, face-to-face or mail/email. This capability currently does not exist in the council, and the organisation s understanding of
the power of this will take time to develop. Customer services will be built over time and develop from a growing confidence and maturity, shared by all parts of the organisation. The phased transition supports the delivery of change and benefit realisation in the place-based services before moving on to the more people-focused service areas, thus building on the success of the work undertaken by Highways and focussing initial effort on services already within the Customer Service Director s remit. The Council has a long term contract for the provision of support services with Capita. This council remains committed to this contract, and it is engaged in a reset activity to realign and refresh our respective objectives, thereby seeking to ensure partnership success. Capita currently provides the Contact Centre the telephony channel for customer services. The council has had an outsourced contact centre since 2004 and has no track record of internally managing this type of operation. The performance of the contact centre is good. Its call abandonment rate, for instance, is 1.8 percent compared with a council-wide average abandoned call rate of five percent. The current re-set activity with Capita recognises the Customer Experience programme and its ambitions. The proposed option recommends a small incremental build on the existing relationship and is therefore not a significant change to the status quo. This enables the programme to progress without the delay of extended contract negotiations whilst retaining the flexibility to do so in the future if desirable. 4.3 The proposed service delivery approach is to use Option 3, which is the most appropriate given the strategic conditions noted above. This proposes continuing with the current procurement solution, externalising elements of customer services where the case is clear. 4.4 Our review of the options also noted the differences in costs and timeliness of implementation. On this basis, Option 1 envisages delayed delivery of savings based on the lengthy contract negotiations required to outsource a complex set of services, some of which may be technically or politically unattractive. Option 2 incurs additional costs which make it an unfavourable option. Option 3 offers an opportunity for speedier delivery of expected savings without undertaking complex and time-consuming procurement or in-sourcing. 4.5 The selection of option 3 at this stage does not preclude the examination of different service delivery options in the future. 5. Resource Implications and Value for Money 5.1 The following table presents an estimate of the financial impact of the proposal. It focuses on the service activities which have been identified as being in scope, which reflect activities currently undertaken by 467.1 full time equivalent staff. 5.2 The savings have been assumed to arise from three separate elements: Management savings from bringing the services together (10%)
Savings arising from Channel Shift (17.6%) and Savings arising from Failure Demand (13.9%) 5.3 These assumptions were developed from joint work with Capita specialists to review specific customer journeys in services. This work was based on reviews of journeys representing around 70% of all transactions in the Council by type. 5.4 The timing of the savings shown in the table below are based on a timetable for transferring staff from their existing structures to Customer Services that has been agreed with the relevant services and the assumption that WSCC are in control of the service delivery option. Financial Year 2015/2016 2016/2017 2017/2018 '000s '000s '000s Baseline Cost 10,857 10,857 10,857 In Year Saving -440-1,366-2,500 Core Customer Service Staffing Requirement 144 233 233 Net Annual Cost 10,561 9,724 8,590 Net Annual Saving -296-1,133-2,267 One Off Investment Costs Enabling Technology Set up Costs 130 Increased IT Maintenance Costs 15 15 Design and business analysis support (including work 401 to prepare the proposal) Programme management & implementation 178 260 Service Improvement ('Quick Wins') 400 Face to Face Pilot 60 Total Cost of Investment 1,169 275 15 Annual Cost/Saving - including investment 873-858 -2,252 5.5 The proposal will require investment in the key activities shown in the table in order to enable the savings which have been forecast. This amounts to a total of 1.5 million in the period shown. This will initially require 1.0 million to be allocated from the Service Transformation Reserve to cover the shortfall in funding in 2015-16, noting that expenditure of 175,000 has previously been incurred in the development of the proposal. 6. Impact of the proposal 6.1 An Equality Impact Report has been undertaken and is in Appendix B. The report identifies no particular negative impacts on residents or specific groups. It notes the programme approach in co-designing solutions with customers as a means by which this may be ensured.
7. Risk Management Implications 7.1 The programme has a full risk and issues log which has detailed descriptions of these and our management response. The current key risks are highlighted below. Key risk That services and staff resist the changes proposed because of the perceived threat to their roles, specialism and existing service delivery arrangements, e.g. in safeguarding adults and children That the contractual relationship with Capita does not enable efficient or effective development of customer service solutions. And that our approach to demand management may be inhibited by existing practice and key performance indicators in the contract The quality of existing data on the provision of customer services within the Council is weak. There is a risk that some of these judgements may be incorrect with an impact on the level of benefits which may actually be delivered. Future benefits in the programme are dependent on further investment in the corporate technology platform. There is a risk that any delay in investment in enabling technology may delay progress in delivering customer services and the benefits outlined. Mitigation Engagement with services and staff planned and in progress Complex customer processes (e.g. social care) are proposed for later implementation Communication plan in place and regularly reviewed Director of Customer Services to manage this aspect of contract services Director is engaged in the current contract review process Capita is a partner in programme delivery and key player in implementation team The Director is engaged in the re-set discussions Acknowledged development need as part of implementation Judgements are based on benchmarks from other councils and organisations in order to test validity Detailed analysis of future requirements is underway Initial options appraisal for customer facing systems has been undertaken that will inform the wider review Cathryn James Executive Director Residents Services Amanda Anderson Director of Customer Services Contact: Marius Kynaston, 0330 22 28077 Appendix A Proposal Delivering a new Customer Experience Appendix B Equality Impact Report Background Papers: None