What can ‘the beautiful game’ teach us about how to unlock local capacity?

Posted on January 23, 2012 by OPM

By Sarah McDonnell, OPM senior researcher, with an introduction from Phil Copestake, OPM principal.

At OPM we know that whatever councillors and officers in local government feel about ‘open public services’ and ‘the big society’, few disagree that with much less money available, local authorities must find a way of unlocking the energy and capacity of local people. Each council is tackling this in a different way.

On Tuesday 21st February we’ll be launching a report based on brand new research with councils across England. The report will give an in-depth, wide-ranging picture of the practical ways in which local authorities are going about the difficult but vital task of unlocking local capacity.

We’ve got a fantastic panel of speakers at the launch event, including the Mayor of Newham Robin Wales, Stuart Etherington from NCVO, the leader of Oxfordshire County Council Keith Mitchell, and Matthew Gott, a senior director from complex families pioneers Swindon. The seminar will be in the early evening, in Central London, and is free, but places are strictly limited. If you’re interested in coming then please email seminars@opm.co.uk.

In the run-up to the 21st February there will be lots of posts on this blog offering different perspectives on how best to unlock local capacity, from the point of view of councils, residents and communities themselves, and local voluntary groups. To kick things off (the first of many puns: you have been warned) we have OPM’s Sarah McDonnell asking: what can local councillors and officers learn from the leadership strategies of managers from the world of… Premier League football! Continue reading →

Supporting yourself and others in tough times: our session at the LGA conference

Posted on June 27, 2011 by OPM

By Sue Goss, OPM principal.

Our breakfast fringe session at the LGA conference was the perfect start to Day 2 of this annual event.

We all know that local government leadership is tough right now. Whichever way we look, the media is brutal, members of staff are jumpy, the public are unhappy and managers are over-stretched.

Leaders, both politicians and managers, are handling unprecedented cuts while creating a vision to which staff and residents can aspire. Difficult choices abound. But little attention is paid to the personal toll of constant calls on our courage, self-discipline and judgment.

The stress is as great as it has ever been – which is why we are exploring new ways in which to support, nurture and equip our managers to lead, which fit the times and their needs. From our work with public authorities it’s clear that there are three crucial skills sets for coping with tough times…

Continue reading →

Protecting organisational culture with employee ownership

Posted on March 16, 2011 by OPM

The Parfett family could have made a lot more money by selling their business to a large competitor.

Instead, they voluntarily took a 20 per cent cut and sold it to their employees. Why on earth did they do this?

First, a little background. As part of a recent Employee Ownership Association (OPM and Parfetts are members) event, OPM trustees visited the Parfetts head office to see how other companies put employee ownership into practice. Employee owned Parfetts is a cash and carry grocery supply company based in Stockport, near Manchester. Since its founding in 1980, Parfetts was a 100 per cent family-owned business. In 2008 the family sold 55 per cent to their employees. The family plans to sell their remaining 45 per cent to employees at a later date.

An uncertain future

Steve Parfett and his brother Robert are the second generation to run the company, following their father Alan. No family member appeared likely to continue running the business, so a few years ago the family looked into options for business succession.

The obvious choice was selling it to another business in the industry. But after researching many options, employee ownership arose as a very likely candidate.

Why employee ownership?

The overriding reason the Parfett family ultimately decided on employee ownership for the future of the company they worked so hard to create was because they wanted to do what was best for their employees. They wanted to retain the family-owned culture.

Directors and employees at Parfetts told us that the company is known for their excellent, friendly service. Although we didn’t talk to any customers, Parfetts sales figures suggest they must be doing something right with £290 million in turnover last year during a difficult and competitive climate.

If they had sold to a large conglomerate, the jobs of many employees, especially managers and senior executives, could have been at risk. As the Parfetts’ website says, selling to a competitor:

‘… would inevitably have left employees working in a very different organisation and vulnerable to any cuts or changes that a new owner might make. Therefore, the over-riding consideration was that the longer term interests and security of employees was taken into account. The family and board also wanted the company to remain a successful business where customers receive excellent levels of service and employees are treated with respect and rewarded for their contribution.’

The benefits of employee ownership

Moving to employee ownership can keep out external influences that might adversely affect an organisation. This is not to say that organisations should not seek external advice or ideas that may help it; indeed, this is often required. But external parties or new owners may not always have a full understanding of the customers, other relationships or nuanced reasons for doing things a certain way.

For Parfetts, if they had sold to an outside owner, the family culture may have been destroyed. Giving employees control of their organisation through ownership will help maintain the practices and culture of this successful company.

Employee ownership can also benefit employees by providing an incentive to increase productivity because they have a share in the results. One of the employee council representatives at Parfetts told us that while he does not have any hard data, anecdotally, he has seen improved employee performance and morale.

Many organisations, especially in the current climate, focus on short-term profits. So we are encouraged to see a private sector company like Parfetts take a long-term view of employee and customer benefits through employee ownership.

Some literature

If you would like some evidence for the benefits of employee ownership and examples of other organisations’ experiences, read our reports, New models of public service ownership and Shared ownership in practice.

For information on how to become an employee owned organisation read How to become an employee owned mutual – An action checklist for the public sector, written by the Baxi Partnership, Field Fisher Waterhouse, OPM and the Employee Ownership Association.

By the trustees of OPM’s Employee Share Ownership Trust (ESOT): Ricci Pleszkan, Leigh Johnston, Justin Kary, Sarah McDonell, Diane Beddoes

User experiences of the welfare-to-work system

Posted on November 9, 2010 by OPM

We recently did some ethnographic research on worklessness for the Lewisham Strategic Partnership (LSP) in the London Borough of Lewisham.

The LSP wanted to gather the experiences of service users on the provision and systems to move from welfare to work. The hypothesis was that people can become trapped in a rigid welfare-to-work system and be put on journeys over which they have little control.

These people are not involved in co-producing outcomes and are constrained in their ability to draw on their existing strengths or wider resources. The result is unnecessary duplication in provision or courses of action without clear goals. The dream of obtaining paid employment never seems to be realised.

Appreciating the value and nature of deep qualitative research, Lewisham asked OPM to spend up to two days with participants with complex needs getting to know their life journey and work history. Some people then volunteered to participate in video interviews to bring their experiences to life.

Main findings

Our work produced several clear messages:

People in a worklessness situation felt they had very little say in developing their welfare-to-work pathway. This can result in confusion and frustration. There is also little flexibility in the welfare-to-work pathway. People are set on a course that does not try to meet their needs.
Service providers tend to focus on quick wins. They help those who they feel are nearest to the labour market get back into employment. Those who have more complex needs are left to ‘cycle’ around the system.
There are usually broader non-employment related needs that must be dealt with alongside welfare to work. An integrated approach is needed to recognise the impact that non-employment related factors have on the achievement of work-related outcomes. One example of this is the acknowledgement of mental health needs. Participants felt that there is little, if any, integration between a person’s mental-health-care pathway and their welfare-to-work pathway.
Volunteering is often seen by people not in work as an effective route to employment, with ‘hard’ and ‘soft’ outcomes that surpass those generated by many formal schemes they attend. Ironically, benefit rules can prevent or disincentivise people from volunteering at the level they want, or from volunteering in the first place.

The government’s new Work Programme seems to speak to some of these findings. It outlines an approach for some of the most complex cases by addressing areas of the current system where participants in our research most want to see change, primarily greater freedoms to adapt the type of support available to meet needs, rather than resorting to pre-determined and sometimes inappropriate pathways.

Evidence from work done by the London Borough of Lewisham and additional research by OPM suggests that such an approach has the potential not only to improve outcomes and break the cycle of benefit dependency, but to also increase efficiency in the system as a whole.

By Sarah McDonnell, OPM senior researcher and Robin Clarke, OPM fellow

Making new models of ownership a reality for public services

Posted on October 18, 2010 by OPM

The public sector is awash with talk about the opportunities for new forms of ownership in public services with evidence suggesting that alternative models of ownership can have tremendous advantages for public services.

But as OPM’s recent report shows, without ruthlessly clear motivations, purpose and a model that fits your circumstances, you risk significantly diluting those benefits or failing altogether. While there is broad appeal and potential, it is time to get into the detailed thinking about how to make this work …

Transforming public services

So how do we transform the public services in this way? What will new models of ownership look like on the ground? Where are public sector leaders and managers at in thinking about this? Crucially, what do employees (who will play an integral part in these changes) think?

OPM is 100 per cent employee-owned. So we are acutely aware of how important it is to get our model of ownership and governance right and to ensure it functions effectively. We understand the transition to a new structure and the nature of this journey, the ingredients for success and the benefits of employee ownership when it is done well. We also know the task is not easy and that new models of ownership are not a panacea that can solve all the challenges we face.

OPM ran the first of a number of workshops with leaders and managers across public services where we spoke as a group about the opportunities and challenges for organisations and groups of employees to transition away from state ownership.

The workshop provided an opportunity for learning and a forum to explore and distinguish basic structures from among the many labels, address some of the legal implications, discuss motivating factors, potential benefits and pitfalls, commissioning and the leadership qualities required to make these new types of organisations flourish.

The discussion was challenging, encouraging and stimulating. Everyone in the group had a unique set of circumstances, a different story and were at a different place in their journey with some very advanced and some only just beginning discussions. All were working daily to enthuse colleagues and leaders.

The common features they all shared was the desire to innovate from the bottom up, the desire to retain (in whatever organisational form) high-quality services and skilled staff and to get ahead of the game by thinking now about these new opportunities and ensuring they have a role and a voice in reshaping their organisations.

One size does not fit all

There is no one model or set of actions for public service leaders and employees – each circumstance is unique and will require bespoke planning and development. But during our discussions it became clearer to participants that the questions to ask, conditions for success, examples of good practice, though not simple, are applicable across the board. Everyone departed enthused and with a list of ‘next steps’ and developments.

The number of organisations looking to branch out beyond state control and set up under new models of ownership will burgeon over coming months and years, ushering in a new way of working for many in public services and an era of new relationships between the state, public sector workers, service users and communities. OPM are ensuring that we make the best use of our values, skills and experiences as an employee-owned (and not-for-profit) organisation to support those embarking on this journey.

By Sarah McDonnell, OPM senior researcher

Place-based budgeting – the good governance challenge

Posted on September 13, 2010 by OPM

The scale of efficiency savings necessary in the public sector is now clear. The response will drastically reshape public sector organisations.

The long-term success of this reshaping depends on the ability of leaders over the next few months to make the right changes, quickly. Good governance is the key to effective change and leadership in uncertain times.

So how do we ensure good governance is put into practice?

Place-based budgeting – the new approach

The basic idea of place-based budgeting is that local government has the responsibility for making decisions about how best to deploy taxpayer money and public resources. Local government should be able to account to their local electors for local funds and outcomes, and be accountable directly to Parliament for national funding received. If central government control and powers of external regulation and inspection are reduced, local government will need to demonstrate good governance so taxpayers know that public resources are being used properly.

In reshaping, local government may decide to delegate some or all commissioning decisions to subsidiary bodies, both new and existing. They should then delegate clearly through the agreement of strategic plans, ‘must-do’ requirements for all providers and new subsidiary commissioning bodies in the area. One ‘must-do’ requirement would be good governance and accountability.

Some place-based initiatives

The Total Place pilots are an example of place-based work. OPM worked alongside the Total Place pilots early in 2009 and we are now involved in similar exercises around the country.

The Local Government Association (LGA) recently made a comprehensive offer to Government to co-ordinate local-area responses using place-based budgeting, which offers a significant shift in strategic decision making and accountability.

The Good Governance Standard

What we must avoid in meeting the governance challenge is the very thing we are trying to minimise – costly and unnecessary duplication. The public sector must employ the expertise it already possesses and revisit work that is coming into its own in the current climate. In 2004 OPM formed part of the Independent Commission on Good Governance and the Public Services resulting in the publication of The Good Governance Standard for Public Services. The main points of the standard are that public service organisations must:

Refocus so their ultimate purpose is outcomes for citizens and service users
Perform clearly-defined functions and roles
Demonstrate and live the values of good governance through their behaviours
Take informed and transparent decisions while managing risk
Continue to develop the effectiveness of their governing bodies
Engage stakeholders and ensure accountability

Place-based budgeting helps to employ standards of good governance and ensure the public interest is kept in mind at all stages of commissioning, delivering and evaluating services.