Crown Commercial Service – Five Different Procurement Businesses?

We mentioned here that we wanted to take a look at the UK government’s Crown Commercial Service (CCS), which addresses procurement across all of central government (and has a role in the wider public sector too). Where might the organisation be going, given the personnel changes it is experiencing now.

What is striking when you look at the organisation is how complex it has become in terms of different areas of activity. It now arguably has at least five quite different aspects of "core business", and it perhaps not surprising that it has struggled in some areas, as its annual report showed. Here are the different areas of interest.

1.  It is still a collaborative buying organisation, as its predecessors such as OGC buying solutions were, looking to put in place (in the main) framework contracts that can be used across the whole public sector. Now that is a challenge in its own right, as any of the other collaborative bodies in local authority, health, or universities sectors will tell you.

2.  But now, CCS is also acting as a full-service procurement outsourcing provider, in effect providing that end-to-end service that an Accenture/Procurian, Proxima or IBM might offer a client. That can involve pulling together requirements, conducting some sort of category management process, putting contracts in place, managing stakeholder and user issues, contract management, and generally the responsibility for making sure suppliers meet the clients' needs.

3.  CCS is also now in effect a consulting firm. The Complex Transactions Team are consultants, working with public sector clients to advise on major projects. Whether or not CCS recognises this, this team is "competing" with external resource options, both independent contractors and the larger consulting firms.

4.  We would also argue that CCS has a role which is not quite covered by any of the above; that is, to work as a centre of excellence in terms of improving commercial and procurement performance across the publish sector, with the strongest focus being on central government of course. This is a role that mimics a procurement central head office in a large, dispersed and devolved organisation. Roles might include developing staff competence and perhaps managing succession plans, looking at where common systems might be appropriate, managing data requirements and the overall performance reporting of the function, And in some, just like CCS, there would be a governance role, with the centre having some sort of right of review or veto over certain contracts.

5.  Finally, we have the regulatory and policy role - everything to do with Europe, procurement regulations at international and national levels, statutory reporting, and other issues that arise in that sphere. It is not a huge element of work in terms of number of staff, but is vitally important nonetheless.

So, we could say that CCS is attempting to run five different business, two of which are certainly quite different to anything predecessor organisations did before the formation of this organisation. Look at it that way, and, as we said earlier, it is not surprising that everything is not running absolutely smoothly.

The areas also require different skills and approaches. Running a full service outsourcing service provider business is very different to the traditional collaborative buying role, for instance, even if there is some commonality in the work. Running a consulting firm is different again; and great category managers don't always make good consultants.

This all raises some questions of course. Does CCS realise the magnitude and challenge of what it has taken on? Should it even be trying to do all of this (although of course civil servants have to do what Ministers ask them to do!) But is the current portfolio of activity sensible? If it is, how should CCS be structured to maximise the chance of the different areas working well?

We could go on - you can suggest your own questions, I'm sure. No answers yet, but we will continue this debate here in coming weeks. And we'd love your contribution - comments, email or we will shortly start a LinkedIn topic and maybe a Procurious group too if you prefer that!

Voices (2)

  1. Stephen Heard:

    Like all things to understand the present you need to go back and try and understand the rationale for forming OGC Buying Solutions in the first place and their journey from OGCBS to BS to CCS and other iterations.

    I joined OGCBS in 2003 straight from the private sector as an Executive Director of what was a Non Departmental Public Body (NDPB) of HM Treasury operating as an arms length body functioning as a trading fund which received no central government funding i.e. it had to survive on its own ability to generate income to cover its annual operating costs.

    It was formed by the merger of three separate traditional civil service bodies as a result of the Gershon review that predicated a saving of £20bn if public sector procurement was transformed. The organisations were the Buying Agency based in Liverpool which traditionally purchased things associated with facilities management and had a long history of operating in this space; the Central Telephone Trading Agency (CCTA) based in Norwich that purchased things like IT and telephony equipment and was originally, I think, part of Her Majesty’s Stationery Office (HMSO) and finally the Government Secure Intranet (GSI) team based in London.

    I had no experience of procurement when I joined the Board other than a long record of contracting in the private sector and a commercial outlook that I was asked to bring into the UK public sector. I think it is fair to say that the original view of OGCBS by the other 70 odd public sector buying organisations was one of suspicion and fear that this central government organisation was going to threaten their very existence. I remember difficult meetings with the forefathers of Pro5 (ESPO etc), NHS PASA, Firebuy, and other buying organisations in Police, Education and Universities.

    There were also considerable cultural clashes with the three forming organisations of OGCBS and the need to charge high commission rates (over 5%) to subsidise their start up costs. They have survived in many forms and now have a low commission (less than 0.5% I believe) rate and offer such things as free procurement training to the profession. I believe they still have a role to play and they have survived a number of the other public sector buying organisations as well as many changes of government.

    I believe that they are a misunderstood organisation and I welcome the opportunity for Spend Matters to shine a light on todays operation to see what the future holds. Happy to be involved.

  2. Final Furlong:

    CCS is continually in conflict with both itself and its customers. On one level, given that its policy role is government-wide, the policy function should be independent and be based in HMT or core Cabinet Office. Otherwise, they’re marking their own homework (“we would like to take over Departmental commercial functions so let’s make sure procurement policy encapsulates this”).
    On a second level, the new CCS has been so poorly executed and Departments (and wider public sector customers) have suffered from poor performance and from a general sub-standard service. The framework factory is still a framework factory. The Complex Commercial Transactions team is highly regarded by some Departments (so the CCTT tell us) while being derided by others. Performance and responsiveness should be consistent. (Capability seems to be the issue.) There is absolutely no way on earth that the CCTT can outperform a mainstream consultancy house on strategy, process and delivery, and it shows. Regardless, everyone knows that the CCS is at war with itself because individual teams are constantly stepping on each other’s toes. You develop a strong relationship with the policy team (for example) but then find that you have an ‘account manager’ and they are based in the CCTT. Things are then lost in translation or in transit. Or they describe the project you are managing (in your sleep) as ‘complex’ (because in their keyed it is) and they join your team to do little more than tell you the time. They then issue a bill for £m’s in ‘fees’. (I thought there might be state-aid issue with this one…)
    You couldn’t make it up (but someone clearly did).

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