Appendix 5 - ASC MSP Value Proposition Model 081210
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The document provides an overview of the current state of adult social care in the UK and a proposed future operating model to transform the sector. Currently, local authorities directly purchase social care services, limiting choice and innovation. The proposed model would create a free market by removing barriers to entry, increasing competition and giving citizens more control over their care. This is expected to provide supply chain leverage, decrease prices, and enhance services while giving citizens more choice.
Appendix 5 - ASC MSP Value Proposition Model 081210
- 1. Adult Social Care Transformation Model Adult Social Care Transformation Model Private & Confidential 6th December 2010
- 2. Contents Current Situation The Opportunity Future Operating Model Partner Analysis The Government VisionThe Government Vision
- 3. The Government Vision The vision encourages decisions regarding care and support to be delivered in a partnership locally between individuals, communities, the voluntary sector, the NHS and councils – including wider support services. The new agenda for adult social care is based on shifting power from the state to the citizen, by focusing on the Governments commitments to: •Breaking down barriers between health and social care funding to incentivise preventative action •Extending greater rollout of personal budgets to give people and their carers more control and purchasing power •Using direct payments to carers and better community-based provision to improve access to respite care This is the Governments first step towards the White Paper which should be published next year outlining their longer term plans in regards to funding and deliver of care and support. Governments Vision for Adult Social Care is about making services more Personalised, more Preventative and more Focused on delivering the best outcomes for those who use them Source – A vision for Adult Social Care: Capable Communities & Active Citizens – November 2010 An opportunity exists to transform the service offering to create a free market approach that supports this
- 4. The Government Vision Contents The Opportunity Future Operating Model Partner Analysis Current SituationCurrent Situation
- 5. Adult Social Care Demographics The Adult Social Care Market • The Adult Social Care (residential care, domiciliary care and home care) sector represents 36% of the overall Social Care Sector • With nearly 1.5m workforce (employed via local authorities) it accounts for approximately 5% of England’s workforce and 38,000 employers, however the actual work force is far greater than this when the whole supply chain is considered • The demand for social care will increase dramatically in the next twenty years in line with current population forecasts. • Even prior to the recession, the government was envisaging a £6bn funding gap for social care by 2026. Councils are experiencing an increasing service demand and costs and falling income. Modelling work suggests that the current social care system would need real-term funding increases of a minimum of 3.6% per year to cover the increase of service demand • An increase in the number of people who use social care services starting to employ their own support staff is expected. The emerging role is expected to be that of the personal assistant as well as 3rd sector social enterprises but a growth is also expected to include: support brokers, assessment and enablement officers, co-ordination & brokerage officers. • 9.5 million of the population are currently aged 64+ there is projected to be a 25% increase over the next decade with Life Expectancy also increasing at an average 2.5 years per decade
- 6. Gross Current Expenditure Profile • The charts below show the share of gross current expenditure by type of provision for adults by all client types for 2007-08 and 2008-09. • The percentage of expenditure on residential care has fallen slightly by one percentage point from 2007-08 while there has been a corresponding increase in the percentage of expenditure on day and domiciliary provision. • In 2008-09 the provision of residential provision accounted for 48 per cent of the gross current expenditure on adults. The provision of day and domiciliary care accounted for 40 per cent of the current expenditure. The remaining 12 per cent of expenditure was on assessment and care management. The Share of gross current expenditure for adults by all client types shows a transition towards domiciliary care: 2007/8 2008/9 2009/10
- 7. Total Market Sizing Gross Current Expenditure on Adult Social Services 2007-08 v 2008-09. • Local Authorities have reported an increase in Adult Social Service spend from £15.3 billion in 2007-08 to £16.1 billion in 2008-09, this is approximately 5 per cent in cash terms and 3 per cent real terms. Over a longer term, this represents a real term increase of 13 per cent since 2003-04 and 54 per cent over the 10 years from 1998- 99. • This sector has been growing at an average rate of around 6.1% a year in current value terms between 2004 and 2008. After allowing for inflation as measured by the gross domestic product (GDP) deflator, this represented an average annual rate of increase over the period of around 3.5% at constant 2008/2009 prices • The total expenditure is anticipated to be £16.7m in 2009/10
- 8. Personal Social Services Expenditure • The Table shows current expenditure by client group and service type for 2008-09. • Between 2007-08 and 2008-09, gross current expenditure on day and domiciliary care increased by 5 per cent in real terms overall. • Gross expenditure on home care provision for older people amounted to just over £2 billion and accounted for 62 per cent of all day and domiciliary care for older people. Source: The NHS Information Centre, Social Care Statistics
- 9. The Current Operating Model Current Operating Model • A traditional approach adopted by many authorities, which involves local authorities purchasing adult social care services on behalf of the service user and therefore the primary contractual relationship is held between the authority and service provider • Contracts are usually a mix of block purchasing and spot buying • The constraints of this model include: • Inflexibility to service users and limitation of choice • Does not engender innovation • Lacks responsiveness to market changes • Lack of commercial challenge • Lack of competition Parallels regarding the procurement of Adult Social Care can be drawn with the utilities market pre and post regulation. Prior to deregulation of the Utilities market was devoid in competition and customers have no scope to change suppliers however since deregulation the number of electricity suppliers has virtually doubled and customers have seen electricity prices fall in the region of 8% and 17%
- 10. The Government Vision Contents Current Situation The Opportunity Future Operating Model Partner Analysis
- 11. The Opportunity The overall opportunity for change is directly linked with the drive towards increasing the level of supported living which will have an impact on the level of domiciliary care services. The opportunity can be clearly built in a modular way which is fully based on the adoption of a “free market” approach
- 12. The Opportunity 12 Domiciliary care supply chain leverage via FOM •Market size of £7bn per annum •Free market supply chain leverage = 2% to 8% Total opportunity = £140m to £560m PA Market Creation and capacity increase •Estimated market size of £1.4bn •Market creation and management = 5% to 15% Total opportunity = £70m to £210m There is considerable opportunity for the UK Adult social care sector to offset the expenditure gap. Phase 1 adopts a free market approach and can be commenced with minimal start up costs.
- 13. The Government Vision Contents Current Situation The Opportunity Future Operating Model Partner Analysis
- 14. Future Operating Model • In response to the Governments vision to provide choice to service users and empower them to choose the type of care that they want, there is a requirement to develop a more flexible and innovative supply chain • Create a Free market that removes barriers to entry therefore creating competition, ability to leverage supply chain, decrease price, enhance service offering and drive innovation, and ultimately providing more choice to the end user • Review the overall service provision under Domiciliary Care to drive the increase use of Personal Assistants for general and domestic care whilst focusing Domiciliary Carers on Personal Care • Provides supply chain leverage for domiciliary care provision (phase 1) and on going social care expenditure (phase 2) • Is underpinned by a modular an end to end focused ASC technology solution FreemarketdrivenbySRM Demanddrivensocialenterprise
- 15. FOM – Working Principles Adoption of Supplier Relationship Management approach to shaping markets To manage risk by provider accreditation process contractual relationships will be between the provider and citizen offer a fully managed service to citizens where there exists a lack of capacity manage quality by adopting national minimum standards evolve a flexible operating relationship with the budget allocation tool Encourage price competition between providers accredited to the catalogue No Supplier framework contracts
- 16. FOM - Suite of Services • SRM • Market Intelligence • Capability & capacity development • Shaping & building free market • Sustainability • Competitive pricing • Knowledge share • Benchmarking • Supply Chain Management • Leverage • Demand & Supply Management • Network Design • Value Realisation • Change Management • Organisational design and development • Process review • Coaching and mentoring • Vision and principles of operation • Commissioning strategy development • Programme Management Office • Project Management • Governance Model • Technology Solutions • Talent management software • Integrated procurement software • Adult social care • Supplier Performance (high value providers) • Catalogue / Portal / Market place module • Forecasting • Budgeting forecasting • Resourcing allocation system (RAS) and planning management • Financial forecasting • Innovation • Supply Chain • Process • System • Supplier
- 17. FOM - Benefits For All Parties The Future Operating Model drives significant step change and drives benefits for all parties
- 18. Strategic SRM Approach 18 Specification Design, Developing the correct risk/reward structure, Developing the correct mix of organisations to promote effective competition, eSourcing Specification Design, Developing the correct risk/reward structure, Developing the correct mix of organisations to promote effective competition, eSourcing Supplier Relationship Management, Open communication (supplier portals), Supplier Forums, Working groups, developing supply base, effective contract management, top supplier awards Supplier Relationship Management, Open communication (supplier portals), Supplier Forums, Working groups, developing supply base, effective contract management, top supplier awards 360 feedback, Self Assessments, Quarterly Reviews, Balanced Scorecards, Continuous Improvement Targets, KPI Review 360 feedback, Self Assessments, Quarterly Reviews, Balanced Scorecards, Continuous Improvement Targets, KPI Review Market Intelligence, Access to Benchmarking, Cross Industry collaboration, Industry best practice Market Intelligence, Access to Benchmarking, Cross Industry collaboration, Industry best practice Network Design, Strategy & Execution Value Chain Analysis Sourcing & Inventory Modelling Supply Chain Network Optimisation Supplier & Market Capacity Evaluation Improvement of Delivery Response Risk & Contingency Assessment Sales & Operational Planning Network Design, Strategy & Execution Value Chain Analysis Sourcing & Inventory Modelling Supply Chain Network Optimisation Supplier & Market Capacity Evaluation Improvement of Delivery Response Risk & Contingency Assessment Sales & Operational Planning Supplier Governance Modelling, Mutual accountability for customer satisfaction, Supplier Open days, implementation, Change workshops Supplier Governance Modelling, Mutual accountability for customer satisfaction, Supplier Open days, implementation, Change workshops
- 19. Proactively managing a supplier relationship to secure a competitive advantage for your own organisation. The focus is on overall relationships between the supplier and the buying organisation rather than a focus on a specific contract. The purpose is to encourage the business to develop a structured understanding of current relationships that exist within and between organisations. Benefits of Adopting SRM
- 20. FOM - Simplifying The Opportunity The Future Operating Model delivers an integrated end to end solution that meets all of the requirements of the Government’s vision.
- 21. The Government Vision Contents Current Situation The Opportunity Future Operating Model Partner Analysis
- 22. Summary Partner Comparison Adecco Capita Comensura Hays Hudson Manpower Matrix Randstad Reed Relationships in Public Sector Financial Stability Experience in this Sector Ambition for Growth Flexibility / Speed to Market Reputation of Core business Geographic Reach Access to Public sector Frameworks Technology Solutions to Support ASC Provision of MSP in ASC today Cultural Fit with Red Relationship with Red / Blackswan Overall Partner Potential
- 23. • Adecco has over 30 years experience working within the health and social care sector, a wealth of experience working with childcare providers including local and national nurseries. • Adecco specialise in placing permanent nursery staff and recruit for nursery managers, deputy nursery managers, room leaders, nursery nurses and nursery assistants. • Adecco recruit for a wide range of nurseries and childcare organisations across London and the South East. Company Overview MSP Experience Adult Social Care Experience Clients • Adecco is a global provider and offers specialist and professional staffing, career services consulting, and outplacement services. • It connects about 700,000 associates with up to 145,000 business clients each day through its network of 6,600 branches in 60 countries. • Adecco operate across Europe, USA, Canada, Japan, Australia, New Zealand and in the emerging markets. • Revenues are approximately £20bn and profit margin ranges from 0.5% to 5.5% • Adecco support over 30 Managed Service Programmes (MSP) across all sectors of UK industry, working both onsite with our customers and via our extensive office network. • Adecco implement and manage recruitment solutions, incorporating Master Vendor, Vendor Neutral and ‘Blended’ MSP solutions through to full Recruitment Process • Hyphen is an industry leading recruitment solutions provider, delivering bespoke services to clients from consulting, through managed services to full recruitment outsourcing (RO). With more than 10 years’ experience, clients range from global banking and financial institutions to IT services and utilities organisations. • Badenoch & Clarke operate under the Adecco umbrella and provide a MSP service to Leicester City Council • Zain Wadee Director of Outsourcing at Hyphen is know by both Red Procurement and Black Swan
- 24. Company Overview MSP Experience Adult Social Care Experience Clients • Capita Resourcing has over 20 years experience in services spanning recruitment, managed services, volume solutions, assessment and outplacement. In the last 12 months we managed over 2,000 campaigns, 500,000 candidate enquiries, 5,000 assessments and 30,000 interim, contract and permanent placements. • Capita Resourcing is a division of The Capita Group Plc, a leading FTSE 100 company and one of the UK's fastest growing Professional Support Services Businesses with over 25,000 employees at more than 240 offices across the UK and Ireland. • Capita’s managed service offering was developed with the benefit of over 30 years experience in delivering innovative resourcing solutions, coupled with the considerable experience and track record of Capita Group, the UK’s leading provider of Business Process Outsourcing (BPO) and professional support services. • Capita’s experience in delivering outsourced resourcing managed services is far reaching and spans multiple industry sectors including: Private Sector Aviation and Transportation IT Services Energy Telecommunications Banking and Finance Retail Public Sector – Central and Local Government Defence • No single managed service is the same. The Capita approach is focussed on solving real business issues for each client with whom we are engaged. • As a client driven business services company, the success is determined by meeting and exceeding the expectations of customers. • Capita has long been at the forefront of recruiting for the public sector, charities and not-for-profit organisations. An important part of this is our specialist division that focuses on social care, social housing, revenues and benefits and technical services. Set up in the mid 1980's as Social Housing Group (SHG), we have extensive experience across these markets and today, are one of the leading UK recruitment agencies of our kind. • Capita Resourcing work with a large number of social care organisations and consequently, have an extensive database of temporary, permanent and contract social care and social worker vacancies all across the UK,.
- 25. Company Overview MSP Experience Adult Social Care Experience Clients • Comensura offer a vendor neutral solution to over 60 local authorities • Working with the Borough of Kensington & Chelsea, Comensura have implemented an online solution to manage the temporary recruitment of all staff including social care. • Comensura was established in 2001, and is headquartered in Luton, UK, with additional offices in Europe, USA and Asia-Pacific. Comensura manages over £400m ($650m) of spend per annum, and have achieved over 100 live client implementations from the public and private sectors. • C-Net technology solutionprocess in excess of 2 million transactions every year from over 39,000 ordering managers. • Dec 2010 has announced the appointment of Charles Austin as public sector relationship director • Comensura offers a combination of managed services and sophisticated technology platform that together manages the entire process for the procurement of agency workers. • It enables key functions to be automated, and monitors and ranks supplier agencies against key criteria including cost, responsiveness and the calibre of candidates to create a dynamic competitive supplier chain that helps assure the delivery of quality workers.
- 26. • Public sector accounts for approximately 23% of the overall business • The remaining 32% of Group net fees comes from our 14 other specialisms ranging from Sales & Marketing and Education to Oil & Gas and Healthcare which means ASC is a very small element of the business today. Company Overview MSP Experience Adult Social Care Experience Clients • Hays has over 6,000 experts working across 17 specialist departments. The company operates through 270 offices across 28 countries including . • In 2009/10 Hays placed approximately 50,000 people into permanent jobs and found temporary assignments for approximately 180,000 people. • Hays primarily derives its revenues from three large specialist businesses: accountancy and finance, construction and property, and IT. • Group revenues were £557m with operating profit of £80.5m UK accounts for 44% of revenue and profit of £11m • Hays Corporate Accounts (HCA) is a provider of HR and Recruitment Process Outsourcing (RPO) services. • Formed in 1994 as part of Hays PLC, HCA has grown substantially now employing over 450 individuals across in Head Office (London), the Shared Service Team (Leicester) or on-site across over 30 client sites across the UK. • With clients across Investment Banking, Retail Banking, Financial Services, Technology, Pharmaceuticals, Oil & Gas, Construction and the Public Sector
- 27. Company Overview MSP Experience Adult Social Care Experience Clients • Hudson (NASDAQ: HHGP) is a leading provider of permanent recruitment, contract professionals and talent management solutions worldwide. • The company employs more than 2,000 professionals serving clients and candidates in approximately 20 countries. • Hudson Europe operates from 39 offices in 14 countries, with 41% of its 2009 gross margin generated in the United Kingdom. • 2009 Accounts show Revenues at $691m, Gross Margin $260m and Net Loss of $40m. • Hudson’s Experience coverss expertise in the following areas: • Account management • Project management • Online recruitment • HR consultancy • Marketing Hudson is have been selected to operate across the following Public Sector Frameworks: BUYING SOLUTIONS FRAMEWORK • Specialist Recruitment, Large Volume Recruitment • CRF (Commercial Resources Framework) for Interim Managers • Employment Business – Temporary Recruitment across all agenda for change bands, • Employment Agency - Temporary Recruitment across all agenda for change bands • Within the Public Sector, Hudson specialises in permanent, executive search, contract and interim recruitment across the following areas: • Central Government/ Government Agencies / Local Government • Education • Charity & Not-for-Profit • NHS • Housing • Membership Bodies • Arts & Heritage • Exec Agencies/NDPBs There is no easy evidence of experience in the social care sector. 2009 PLACEMENT ACTIVITY: 639 permanent placements made in Public Sector in 2009: • Up to £45k: 470 placements • From £46k to £65K: 110 placements • From £66k and above: 59 placements An Average of 813 temporary, contract and interim candidates on assignment
- 28. Company Overview MSP Experience Adult Social Care Experience Clients • Manpower EMEA (Europe, Middle East and Africa, excluding France and Italy) comprise operations in Germany, the Netherlands, Norway, Spain, Sweden, and the UK. Together, the company operates through 1,233 branch offices and 52 franchise offices in EMEA region. • Manpower UK is the largest operation of the company in the other EMEA segment. • Manpower groups revenues have reduced from $20bn to $16.4bn which saw the company post a negative profit margin during 2009. • Manpower’s dedicated delivery models include a central ordering system, offering real time, on-line, capture and reporting of key data to enable you to monitor performance outputs and manage cost. Access to specialist suppliers through the dedicated team provides consistency, quality of service and a visible buying environment for local suppliers. • Manpower delivers outsourced recruitment solutions to both the NHS and private sector health service providers. • Manpower are now a preferred supplier on both the Non Medical, Non Clinical and the Commercial Resources Frameworks, managed by OGC Buying Solutions, allowing us to provide our 500+ NHS customers with greater control over their time, processes, service delivery and pay bill. • Under the Non Medical, Non Clinical (NMNC) framework Manpower provide all job roles included within the specification. • Working in partnership with Hertfordshire County Council, Manpower based in Hertford (part of Manpower Inc) handle all permanent and temporary recruitment from domestic workers to care workers, from social workers to team managers and occupational therapists. • BS Social Care and BS Home Care are two of the UK's most successful niche recruitment agencies. • Since BS Social Care were established in 1993 as quality providers of suitably skilled and qualified care professionals, they have grown and expanded rapidly. Specialising in both temporary and permanent positions within the public, private and voluntary sectors, they have a network of over 20 offices spanning the UK and have developed firm relationships with key employers' nation-wide. • Typical positions include - Care Manager, Learning Support Assistant, QSW, Qualified Social Worker) and RSW (Residential Social Worker)
- 29. Company Overview MSP Experience Adult Social Care Experience Clients • Matrix SCM engages with over 7000 local suppliers across the UK. • Since 2008 Matrix SCM has more than doubled its client base and increased turnover by £70m • Matrix manage over £270m of spend across its clients • Matrix adopt a systematic approach to implementation allowing them to achieve a contract start date with clients within 90 calendar days after formally commencing implementation • Matrix have been providing a supply chain management solution for over 10 years to over 37 local authorities • Services to the local authorities include working closely with the housing association. • North Yorkshire County Council appointed Matrix SCM to take over responsibility for the procurement and management of all temporary staffing suppliers used by the council. Matrix SCM is now responsible for managing an annualised spend of £20m on behalf of 6 local authorities within the region. • Matrix are currently working with Coventry City Council providing them a supply chain solution in their adult social care program. This includes an online auction “bidding software” package to provide leverage within the market place.
- 30. • Randstad Care is a National Provider of Care and Support with over 60 years' experience. • Randstad Care was created from the merger of two market leaders and has 240 consultants across a network of 25 offices throughout the UK and Ireland within the following sectors: • Social Care • Domiciliary Care • Social Housing • Allied Health Professionals • Nursing Nursery • Randstad delivers a wide range of general and specialist domicilary care to a variety of people offering a 24/7 services covering, Personal Care , Help with Medication , Meal Preparation, Assistance with Mobility (Moving & Handling), Continence Care, Live-In Care, Day and Night Sits, Shopping & Domestic Help, Accompanied Visits , Sitting Service, Specialist Care, Escort Services, Holiday Live in support, Respite Service Company Overview MSP Experience Adult Social Care Experience Clients • The company's operations are organised into three business segments: staffing, professionals, and in-house services. • Revenues for 2009 were approximately $17.2bn and Randstad account for 4% of the UK employment market place. Margins have reduced to 0.5% although a slight increase from 0.1 in 2008 down from 3.5% in 2005. • The company has subsidiaries in several countries offering search and selection services, which also includes a range of related recruitment and training programs. The company professionals‘ brands include randstad, Sapphire, Yacht, expectra, Hill McGlynn and bbt. • The Randstad master vendor delivery model (RCMS) offers clients a contingent labour management process. Experienced social care consultants monitor incoming calls 24 hours a day, managing vacancy distribution via an e-recruitment/booking system designed specifically for the social care arena. • The managed solution provides clients, such as Newport City Council and Cumbria County Council, access to the extensive supply capabilities of Randstad Care. In addition to managing the local candidate flow, RCMS provides clients with the unique proposition of being able to access a global talent pool of qualified workers. • RCMS manages a second tier of approved suppliers. Following a prequalification process, the ongoing auditing of suppliers gives clients the assurance that the supply chain is fully compliant with all legislative and service requirements. The RCMS solution will subsequently ensure that all vacancies are filled from the approved supply chain. • RCMS technology generates detailed management information for clients, and can deliver further efficiencies via electronic time-sheeting and consolidated invoicing.
- 31. Company Overview MSP Experience Adult Social Care Experience Clients • Reed is a specialist provider of permanent, contract, temporary and outsourced recruitment solutions, IT and HR consulting. • Assisting jobseekers and employers since 1960, Reed’s global expertise spans Europe, the Middle East and Asia Pacific. Reed is independent, has 350 offices worldwide, employs 3,000 people and delivers a world-class service across more than 30 specialisms. • reed.co.uk is the UK's biggest jobsite and receives over 1.3 million job applications per month. Internationally, reedglobal.com enables jobseekers to search for opportunities across multiple industry sectors across the world. • Operating as a Master Vendor or Neutral Vendor, our team provide one point of contact for all your recruitment requirements, taking and fulfilling orders through approved agencies, and coordinating the entire recruitment process, from CV screening to arranging interviews and confirming job offers. • Managed Services On Demand technology enables all parties involved in the recruitment management process to engage through a single interface and is designed to manage even the largest and most complex staffing demands, to delivery of all requirements in terms of volume, staffing types and geographical locations. • Buying Solutions framework agreements: • Buying Solutions Health – Administrative & Clerical • Buying Solutions Health – Allied Health Professionals • Buying Solutions Health – Doctor • Buying Solutions Health – Nurse • Large Volume Recruitment • Specialist Contractors • Temporary Clerical and Administrative • Reed Social Care is a leading specialist recruitment consultancy for high- quality, dedicated social care and community care staff. • As part of Reed Specialist Recruitment, they have been providing a service for more than 20 years. • From a nationwide network of offices, Reed place people into qualified social work, community support and residential work, in the public and private sectors. • Reed candidates range from Care Assistants and Service Managers, through to Senior Management seeking work within all social care settings including Housing and Day Services
- 32. Company Overview MSP Experience Adult Social Care Experience Clients • Founded in 2006 with over 250 employees • Annual turnover of over £35m • Ochre House is one of Europe's leaders in new generation recruitment outsourcing and talent management • Ochre House run a regular forum called “think tank” to exchange knowledge and address key challenges in HR • Ochre House worked closely with BUPA to increase the efficiency of their staff resourcing function to improve time to hire, control costs and reduce reliance on external agencies. • The project involved hiring over 1300 new staff over 2 years and to develop initiatives to ensure high levels of retention. • Results from this project included - All KPIs met within first five months and 91% of all vacancies filled on time • Ochre House has also had many MSP successes with Somerfield, Agilient Technologies and Siemens • None at Present