A recent report from Westminster Sustainable Business boasts some attractive headline figures on how much local authorities could save by rationalising their property portfolio and ‘co-locating’ back-office operations.
What is particularly interesting are the recommendations made on ways in which councils can respond to cost-cutting pressures without actually making a reduction in the services they provide. As the recent uproar around a reduction in refuse collections in parts of the UK showed, making cuts to popular services is rarely well received.
So, to achieve the balance of saving costs whilst maintaining high levels of service provision – and particularly when it comes to ‘popular’ services – what must remain front of mind for any local authority is whether decisions being made today about how and where to cut will have a positive and lasting impact. Crucially, in their effort to increase efficiencies, councils must be careful not to fall into the trap of making knee-jerk cuts which might prove a step too far and even hinder critical services in the months or years to come.
When it comes to the report’s recommendation to rationalise assets, a primary concern for councils must be ensure those assets will still be fit for purpose not only for today’s needs, but also to suit the operational shape of the future – which may look very different.
Similarly, when condensing multiple services and back-office functions into one single location, asset management teams must consider the compatibility of those functions being brought together. For example, the report draws attention to potential data protection issues as a barrier to co-location, and indeed, departments that deal with sensitive information will need to have proper confidentiality measures in place. But, if the associated risks are properly managed, these issues should be surmountable.
There will likely also be some internal communications work to be done, as the traditional divisions between teams are broken down. At a time when employee engagement and morale levels are particularly important, local council managers will need to make sure the benefits of the changes are properly and clearly communicated and understood by all levels.
While these kinds of issues might make co-location seem somewhat daunting at first, such a move could in fact prove an effective way to combat traditional ‘silo-thinking’ and the belief that each department must be kept separate. This in turn may lead to beneficial new ways of working – meaning, as the report suggests, that streamlining property and assets as a cost-cutting measure could have an additional and positive impact: an improvement in services.
But to reap rewards in terms of both finance and productivity, it is vital that these kinds of changes are thoroughly planned and managed to mitigate risk. Any cost-cutting decision – be that streamlining assets, consolidating services, or reducing staff numbers – must be made only following an in-depth, holistic assessment of each and every possible risk, and of business continuity needs. Otherwise, what seems a logical short-term approach might eventually cost more than it saves.
Andrew Jepp is director of public services at Zurich Municipal