External Service Delivery

Handbook Your guide to External Service Delivery

in the Irish Public Service

Version 3.0

May 2014

Foreword by Mr Robert Watt, Secretary General, DPER

The difficult economic situation

in which Ireland finds itself

means we have had to radically

re-think how we manage and

deliver our public services.

External Service Delivery (ESD)

is one area of reform that can

potentially deliver a range of

benefits in the provision of

public services. These include

financial savings arising from

enhanced management

practices and performance

measurement. There can also

be greater potential for

innovation through access to a

wider set of skills, knowledge

and technologies. Delivering

services externally also

provides an opportunity for

greater focus of scarce

resources on core activities.

Pragmatically, Government

organisations should enlist

external providers when the

benefits outweigh the costs of

doing so, bearing in mind the

quality of service, effectiveness

and the public interest.

There are a wide range of

Government activities that are

being successfully delivered by

external providers. These

include eFlow and the bovine

traceability system. Many

departments and agencies

across the public service have

facilities management, IT

services, inspections, document

management, printing and legal

services delivered externally.

These initiatives have

demonstrated that external

service delivery can deliver

excellent outcomes for all

participants, including the state

and the citizen.

Successfully managing ESD of

any public service is a complex

process. We must increase the

capacity and capability of public

servants to understand, and

implement the Key Principles of

successful ESD delivery. These

key principles include driving

value for money in the public

service and delivering best in

class services for citizens by

making the best use of

resources. We must also aim

to foster continuous

improvement through

innovation, develop more

responsive systems and to

leverage new technologies to

successfully delivery services

externally.

I hope that you will find this

handbook a useful aid for

evaluating and implementing

ESD Projects in your

organisation. It is my ambition

that the links we are building

with industry will ultimately

lead to a culture of

collaborative partnership

between the public and private

sectors in which the best of

both sectors can come together

to deliver the cost effective,

high quality, innovative public

services the people of our

country deserve.

About this Handbook

Who is this

Handbook for?

This handbook is for

distribution within the Public

Service to provide a

background and introduction

to External Service Delivery

(ESD).

What is it

about?

This handbook is designed to

provide a high level overview

on External Service Delivery

and the framework used to

identify and assess potential

services for ESD.

How you

should use it

This is a reference document

that should be reviewed prior

to commencing any detailed

ESD analysis. It should be read

in conjunction with;

The Guidelines in the

Engagement of Consultants

and Other External Support

by the Civil Service (and

other national guidelines);

Relevant EU Public

Procurement Law; and,

Public Procurement

Guidelines - competitive

process.

Note to Reader

This document is issued by the

Department of Public

Expenditure and Reform

(DPER) to provide general

guidance and information on

approaching an ESD project. It

is not an exhaustive

interpretation in relation to

any legal provisions governing

public procurement or

contracts. Additional advice

may be sought from DPER

(contact details can be found

on page II at the end of this

handbook). Legal or other

professional advice should be

obtained about the

interpretation of legal

provisions or the correct

application of such provision.

This is a living document and

will be updated regularly as

relevant sections of law

change. Please ensure you are

working on the most recent

version by checking on our

portal where the most recent

version will always be saved.

What are your

first steps?

If you are considering an

External Service Delivery

project, you could think about

the following steps:

Step 1: You should familiarise

yourself with relevant on-line

information (this can be found

on the ESD portal on the

Government network and

Government websites).

Step 2: You should contact the

ESD unit in the Department of

Public Expenditure and

Reform. They can provide

expertise around the various

types of external service

delivery and explain how to

start the process.

Step 3: Attend the two day

training programme ‘An

Introduction to External

Service Delivery’ that is co-

ordinated by the Reform and

Delivery Office. For further

information on these courses

please click here.

Step 4: Follow the phased ESD

process outlined in this

handbook.

Step 5: You will need to create

a cross functional Governance

team to manage your ESD

project. The team should be

equipped with specialist skills

and competencies in areas

such as IT; finance; HR; legal

and procurement.

Key Learning Outcomes

After you have studied this

document you should be able

to follow the key steps in each

phase and have learnt how to:

Assess Phase

Identify potential

opportunities for ESD in

your organisation.

Carry out an initial

assessment on suitability

for ESD.

Carry out a detailed

assessment as per the

methodology outlined in

this handbook once the

initial assessment suggests

a service is suitable for

ESD.

Prepare Phase

Carry forward opportunity

into the Prepare Phase and

prepare a business case

and feasibility study.

Set conditions for a strong,

mutually rewarding

relationship.

Develop terms and

conditions of the contract

(with support from legal).

Determine the evaluation

and selection criteria.

Evaluate Phase

Make objective decisions

that are auditable.

Evaluate and rank the

supplier(s) that represent

the most economically

advantageous tender

(MEAT) for the services in

scope.

Commit Phase

Finalise contract signature.

Transition Phase

Implement a robust

transition plan in

collaboration with the

supplier.

Plan and implement an

appropriate restructuring

of the retained

organisation.

Develop standard

operating procedures.

Implement a measurement

and reporting mechanism

to track value.

Optimise Phase

Internally develop a

function to manage

business demand and

supply.

Provide the focus and

resource for dedicated

sustained ‘benefits

realisation’ activities.

Build an experienced

commercially-focused

team to contract manage

public sector organisation

and supplier rights and

obligations.

Invest time, effort and

sponsorship in innovation

management to ensure

improvement and

transformation objectives

are pursued after

execution.

Exit Strategy

Have effective exit

arrangements enclosed in

the original contract of

engagement.

Manage the exit of an ESD

contract without

disruptions to services in

your organisation.

Exit Strategy

Contents

Overview ...................................................................................................................................... i

Chapter 1 .............................................................................................................................. 1-2-1

The Assess Phase .................................................................................................................. 1-2-1

Chapter 2 .................................................................................................................................. 2-1

The Prepare Phase .................................................................................................................. 2-1

Chapter 3 .................................................................................................................................. 3-1

The Evaluate Phase ................................................................................................................. 3-1

Chapter 4 .................................................................................................................................. 4-1

The Commit Phase ................................................................................................................... 4-1

Chapter 5 .................................................................................................................................. 5-1

The Transition Phase ................................................................................................................ 5-1

Chapter 6 .................................................................................................................................. 6-1

The Optimise Phase ................................................................................................................. 6-1

Chapter 7 .................................................................................................................................. 7-1

The Exit Strategy ..................................................................................................................... 7-1

Irish Public Service ESD Examples ................................................................................................ I

Conclusion & Reference Sites...................................................................................................... II

Overv

iew

i

Exit

Overview

A. What is External Service Delivery?

ESD is the contracting out of a

business process or activity,

which an organisation may

have previously performed

internally or has a new need

for, to an independent

organisation from which the

process is purchased back as a

service.

As governments' experience

and capacity to regulate

private sector providers have

improved and the private

sector is becoming more

willing to supply public

infrastructure and services,

governments have become

increasingly prepared to

contemplate innovative forms

of non-government service

provision through ESD.

ESD has a number of key

benefits, including cost

efficiency. Among the other

benefits of ESD are:

Better services to the end

user,

Reduced pressure on local

management,

The ability to flex in time of

increased demand,

Improved services; and

Improved access to new

operating models,

management practices and

technologies.

ESD provides a framework to

help determine how and by

whom programmes and

services should be delivered –

new kinds of delivery

arrangements are emerging,

including special operating

agencies and public-private

partnerships.

ESD covers new organisational

arrangements that span a

broad spectrum of delivery

arrangements for public

services.

The following table outlines

some of the ways that ESD can

be implemented for the public

sector depending on the

context and nature of the

service.

Term Definition Example

Partnerships / Mixed

Ventures / Joint

Ventures

Public-Private ventures or partnerships designed to deliver

infrastructure and/or services which are funded and

operated through a partnership of government and one or

more private sector companies.

Toll road

management; and

other public private

partnership

schemes.

Contracting Out Public entities purchase services under contract from private

firms, but retain accountability for the service.

Contract catering or

cleaning services.

ESD is not just about achieving cost efficiency; other benefits include service

improvement, reduced management overhead and flexible resourcing.

ii

Exit

Franchising/

Licencing

For franchising, the government confers to a private firm the

right or privilege to sell a product or service in accordance

with prescribed terms and conditions. For licensing, the

government grants a license to a private firm to sell a

product or service that unlicensed firms are not allowed to

sell.

Mobile operators /

radio licences.

Mutuals / Employee

Takeovers

A public service mutual is an organisation which has left the

Public Service (also known as ‘spinning out’) but continues to

deliver public services. Mutuals are organisations in which

employee control plays a significant role in their operation.

They are a newer form of contracting out that involves

contracting with a former government employee, or

employees, to deliver a service previously delivered directly

by the government.

A pension’s

administration joint

venture partnership

between employee

partners, UK

Government and

Paymaster.

This handbook focuses

primarily on the Contracting

Out model as it is the most

common form of ESD.

Examples of activities that may

provide opportunities for ESD

include catering; facilities

management; property

management; security services;

debt management; customer

contact/call centre; ICT

infrastructure and ICT support;

payments/grants

administration; recruitment;

licensing; training and

courier/transport services.

These are only suggestions and

not an exhaustive list.

Areas should only be

considered for ESD once they

have a clear strategy for

mitigating risk. This is especially

important where it is difficult to

measure the value added by a

potential supplier. In this

instance it is challenging to

price contracts and to monitor

performance. Furthermore in

areas where a service outcome

is highly dependent on the

performance of other services

it can be difficult to secure the

necessary co-operation

between providers or providers

and in-house provision. Where

services have uncertain

demand or are characterised by

high policy uncertainty,

departments may find it hard

to re-negotiate contracts.

Furthermore, if you are

proceeding to ESD, it is

probable that mitigating

against the above scenarios

may involve additional costs

which you should budget for.

iii

Exit

Overview

B. Benefits Realisation

The following pages look at

some of the experiences

organisations have had with

implementing ESD initiatives.

These results are from the 2012

Deloitte Global Sourcing

Survey, and while they mainly

reference the private sector the

results are applicable across all

sectors and indicate clearly that

cost reduction while important

as a driver of ESD is not the

only benefit that is sought

after.

Key findings show that reducing

operating costs is a very

important objective of an ESD

initiative but that there are

more drivers to ESD than just

cost reduction.

The survey show that

improving customer service

and leveraging new

technologies ranked nearly as

highly as reducing costs in

terms of the important

objectives of an ESD initiative.

The survey also reveals that

another key objective of ESD

initiatives is the ability to allow

a more flexible HR model to

flex in times of greater demand

and also to improve overall

controls.

When asked about customer

satisfaction with external

service delivery the 2012

Deloitte Global survey revealed

that most respondents (76%)

are either extremely satisfied

or satisfied with their most

recent ESD initiatives.

Underestimating scope (52%) is

the most often reported

problem with most recent ESD

initiatives, followed by

suppliers being unable to meet

service levels. This illustrates

that the initial scoping and

assessment phase is critical to

the overall success of an ESD

initiative.

One key piece of feedback from

the survey is that ESD is more

than a third-party contractual

arrangement. It is a key

business relationship.

Therefore assessment and

preparation to ensure a

thorough understanding of the

supply market is key to success.

How important were each of these objectives in your most recent ESD initiative?

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Exit

What factors led you to be less than satisfied with your most recent ESD initiative?

How satisfied are you with the outcome of your most recent ESD initiative?

Source: 2012 Deloitte ESD Survey

v

Exit

Case Study

The National Roads Authority (NRA)

The NRA eFlow Barrier-Free

Tolling Project on the M50

Motorway is a very successful

example of an ESD project

within the Public Sector. This

case study will flow through

each section of the handbook

for illustrative purposes.

In January 2006 the

Government announced that as

part of the planned upgrade of

the M50 Motorway, the

existing toll arrangements on

the motorway at the West-Link

Toll Bridge would be replaced

by a barrier-free tolling system

during 2008.

Barrier-free tolling, as the name

suggests, enables the collection

of tolls solely by electronic

means without any barriers or

toll-plaza on the motorway –

and therefore no need for

motorists using the motorway

to stop or slow down to pay the

toll charge. While tolling by

means of barrier-operated

plazas is a long established

practice in many countries, the

M50 system was one of the

first fully electronic tolling

systems to be deployed on a

European motorway and as

such there was relatively little

industry experience on which

to draw upon when

establishing this new business.

The new barrier-free system

called eFlow (which is a

registered business name of

the NRA) was ‘switched on’

during August 2008. It is fair to

say that the delivery of the

M50 eFlow project and the

creation of a new public sector

tolling business was possibly

one of the most challenging

projects that the NRA has ever

implemented. While the

project was on time and

delivered to budget there were

nevertheless a myriad of

technical and operational

issues to be addressed during

the Mobilisation Phase (just

after ‘go-live’) which resulted in

significant levels of customer

frustration, a large backlog of

customer contact to manage

and widespread negative media

attention.

About two months after the

launch, the NRA recognised

that the operation was simply

not performing adequately

across a number of critical

areas of the business (e.g.

customer management and

collections). As a consequence

the delivery team had to take a

step back and reconsider the

objectives and approach to the

new business in order to

determine and implement a

revised strategy to stabilise the

business and to create the right

platform from which it would

develop and improve going

forward.

One of the first things the team

did following this, and perhaps

one of the most critical, was to

work out a simple mission

statement for the business,

which was as follows:

To procure and oversee a world

class barrier-free tolling

operation on the M50

Motorway which is

commercially focussed,

financially efficient and results

in a positive experience for all

customers using the Motorway.

The eFlow business has

changed completely from those

difficult early days. The

business has gone from

strength to strength in terms of

customer numbers and

revenues and is now

internationally recognised as an

excellent customer service

business. So much so that

eFlow “swept the boards” at

the Contact Centre World

Awards 2011 in London for the

EMEA region by achieving

seven awards including three

gold medals in categories such

as customer service, training,

and IT/innovation. eFlow also

received a Public Sector

Excellence Award from An

Taoiseach in 2011 and was also

awarded the Outsource

Partnership of the Year for

2012 at the Irish Contact Centre

& Shared Services Awards.

vi

Exit

Overview

C. Pre - ESD Checklist

Think about

what you are

trying to

achieve

Are you considering an ESD

project for the purpose of:

Reducing costs?

Improving service

delivery?

Improving customer

experience?

Creating more flexibility in

your organisation?

Leveraging new

technologies?

Improving controls?

Other?

Think about

timing

Is this the correct time for

you? Are you ready to

commence an ESD

project?

Do you really understand

your service?

Is the service you are

considering for ESD

working well in-house? If

not, then it should be fixed

before beginning an ESD

project. You could

consider external

expertise to resolve the

problem. After service

improvements, the service

should be re-assessed to

see if there is a business

case for ESD.

Have you got sufficient

resources in place (time;

money and premises etc.)

to assess and prepare your

service for ESD?

Other

Considerations

Have you taken into

account the required

output benchmarks that

will help you to

successfully manage the

ESD contract? This might

include consideration of

service levels, value and

the scope of the contract.

Do you have resources in

place to begin

procurement planning?

Have you considered the

internal governance model

for the project?

Have you considered the

potential of combined ESD

opportunities? For

example, a contract

cleaning and security

combined ESD project.

vii

Exit

Overview

D. The ESD Framework

There is a detailed and template driven methodology in place to determine activities throughout the

lifecycle of an ESD project.

The ESD lifecycle consists of 6 phases, namely;

Assess

Prepare

Evaluate

Commit

Transition

Optimise

Each phase contains a number of activities across the six functional areas identified in the diagram

below.

Phase 1 - Assess

It is in the Assess Phase that the

early high level unknowns must

be flushed out and confronted.

The activities in this phase are

critical to establishing senior

stakeholder expectations, both

for the ESD initiative as a whole

and for the amount of time and

effort required to secure it. By

the end of the Assess Phase

there will be a commonly

understood view of the likely

benefits, costs and risks of the

ESD initiative and of the

activities required to

respectively maximise,

minimise and mitigate these. A

Business Case (1) analysing a

range of possible delivery

options must be produced at

this stage. Financial analysis

metrics (2) must also be

completed.

Phase 2 - Prepare

The Prepare Phase

encompasses a thorough

examination of the market and

supplier base and the

preparation of detailed

requirements to be included in

People & Organisation

Location & Asset Management

Information Technology

Change Management

Programme & Risk Management

Value

Prepare

Evaluate

CommitTransition

Optimise

Assess

Exte

rnal

Ser

vice

Del

iver

y

viii

Exit

the RFT and contract. This

analysis will also identify the

procurement procedure most

suited to the specific

circumstances of the ESD

project. Qualification and

award criteria for evaluating

tenders need to be developed

and all key service delivery

elements; costing issues and

contractual terms must be

identified. During this phase

the fundamental elements of

the remaining phases of the

lifecycle are also defined and

agreed. This is often the most

resource intensive and

commercially significant phase

of the ESD lifecycle.

Phase 3 – Evaluate

The activities within this phase

are broadly aligned to three

steps that cover: 1.The

management of the suppliers

whilst they are preparing their

tenders; 2. Evaluation of the

tenders and 3 Notification to

unsuccessful tenderers.

Following completion of the

Evaluate Phase, the public

entity will be ready to proceed

to contract. The sequence of

activities within this phase will

be dependent on the

procurement procedure

followed.

Phase 4 – Commit

The Commit Phase includes the

final pre-contract stages of

both internal and external

activities across the ESD

initiative, supplier

management, people and

organisation work streams. The

contract is finalised. Significant

internal stakeholder

management activities are

required to secure the buy-in

and sign-off necessary to

complete the ESD initiative. In

parallel, the organisation

design will be finalised and

transition roadmap and plans

(3) developed.

Phase 5 – Transition

The Transition Phase of the ESD

lifecycle focuses on

transitioning the work and

resources (infrastructure and

responsibility) to the successful

tenderer(s) and effective

stakeholder management to

ensure effective contract

management and optimised

value. The phase includes

implementing a robust

transition plan with the

supplier(s) and establishing a

reporting mechanism to track

value.

Phase 6 – Optimise

The Optimise Phase of the ESD

lifecycle focuses on the steady-

state operation of the ESD

arrangement after the

Transition Phase has been

completed. Within this phase

public entities need to focus on

managing the supplier

relationship, monitoring

contractual obligations as well

as tracking the supplier

performance against the

original business case.

By its very nature, the Optimise

Phase is very much an

operational responsibility

which continues throughout

the duration of the contract

until the contract renewal or

exit.

The Exit Strategy

The Exit Strategy offers

guidelines for preparations to

exit an ESD contract and

making arrangements for

handover to a new incoming

supplier. It is very important for

the public entity to have

effective exit arrangements in

place if the ESD contract fails or

the relationship between the

public entity and the supplier

breaks down. The original ESD

contract should contain an Exit

Agreement with clauses that

allow for renegotiation or

termination of a contract by

either party.

ix

Exit

E. ESD Framework – Phase Roadmap

The ESD framework is a

comprehensive tool used to

guide the process of

transitioning to an ESD model.

The framework provides

guidance in respect of three

critical functional areas

namely; Phase Activities,

Programme Management

Office Activities and Outcomes.

2. Prepare 4. Commit3. Evaluate 5. Transition 6. Optimise

Outcomes

‘As Is’ Model & Baseline

Preliminary Business Case, ESD Scope & ESD Options

Detailed ‘To Be’ Model and ESD Requirements

Agreed RFT Criteria and Documentation

Initial Analysis of Proposals & Audit Trail

Preferred Supplier Shortlist

ESD Agreement

Retained Org. Structure, Transition Plan & Value Delivery Roadmap

Implemented Transition Plan & Retained Org. Structure

Relationship with Supplier

Active Monitoring

End of Term & Draft Future Strategy

Phase Activities

Mobilisation, Project Governance & Risk Management

Assess Phase Stage Gate

Prepare Phase Stage Gate

Evaluate Phase Stage Gate

Commit Phase Stage Gate

Transition Phase Stage Gate

Optimise Phase Stage Gate

Programme Management Office Activities

1.1 - Complete Initial ESD Assessment

1.2 - Develop Baseline & Preliminary Business Case

1.3 - Scope Transition & Assess ‘As Is’ Process

1.4 - Determine & Agree ESD Transition Principles

1.5 - Identify, Assess & Manage Risks

1.6 - Assess ESD Options

1.7 - Assess Location & Estate Considerations

2.1 - Prepare ESD Scope & ‘To Be’ Process

2.2 - Determine Delivery Structure

2.3 - Define Operating Model

2.4 - Develop Pricing Model

2.5 - Prepare for Supplier Selection

2.6 - Define Services & Develop Specifications

2.7 - Prepare RFT

2.8 - Prepare Stakeholders for ESD Transition

2.9 - Define Retained & ‘To Be’ Org. Structure

3.1 - Confirm Structure Alignment

3.2 - Manage Supplier Interaction

3.3 - Develop Initial Plan for ESD Transition

3.4 - Evaluate Proposed Service Locations

3.5 - Manage Evaluation Activities

6.1 - Assess Value Leakage & Track Benefits

6.2 - Manage Continuous Improvement

6.3 - Prepare Future Strategy

6.4 - Manage Commercial Obligations

6.5 - Optimise Supplier Relationship

6.6 - Manage On-going Demand

6.7 - Manage Change

5.1 - Monitor Value Proposition

5.2 - Develop Transition Plan

5.3 - Develop &Manage Process Guide

5.4 - Monitor Supplier Transition

5.5 - Manage Workforce Considerations

5.6 - Shift Responsibilities to Supplier Organisations

5.7 - Manage the Transition

4.1 - Reassess Value Proposition

4.2 - Select Supplier & Sign Contract

4.3 - Clarify Contract Details with Successful supplier

4.4 - Manage Stakeholders: Executive Buy-in & Approval to Sign-off

4.5 - Finalise Retained Org. Structure

4.6 - Manage Security &Control

4.7 - Manage Communications & Align Work Streams

1. Assess

x

Exit

F. Phase Roadmap Guide

Phase Activities

The phase activities as outlined

on the phase roadmap detail

the specific activities to be

completed during each phase

of the ESD Framework.

Successful completion of each

phase requires careful

consideration of each activity

in addition to the

consideration of Programme

Management Office Activities,

Outcomes and a number of

Transition Principles.

Programme

Management

Office Activities

The Programme Management

Office (PMO) Activities as

outlined in the phase roadmap

provide an overview of the

various PMO activities that

should be considered during

an ESD transition, namely;

Mobilisation

At the outset of each

phase it is vital to mobilise

the engagement team.

This process incorporates

the initial resource and

activity planning,

stakeholder engagement

and communication

planning activities.

Project Governance

At the outset of an ESD

transition it is vital to

determine and agree

governance arrangements.

These arrangements will

determine how the

transition is managed and

must be reassessed at the

beginning of each phase

and throughout the

transition.

Risk Management

Proactive and thorough

risk identification,

assessment and

management is crucial for

the success of an ESD

transition. Specific risk

management activities

have been aligned to

certain phases throughout

the ESD framework, as will

be seen later in this

handbook. However, it is

vital to note that careful

consideration must be

given to risk management

throughout the transition

process.

Stage Gate Process

The final PMO activity to

be undertaken at the end

of each phase is the Stage

Gate Process (see overleaf

for more details). This

activity involves assessing

the work completed as a

result of the undertakings

during the respective

phase and benchmarking

the outcomes achieved

with targets, objectives

and if possible industry

best practice. If the work

completed does not meet

specific requirements it

should not be signed off

by senior management

and therefore the

transition project will not

pass through the Stage

Gate to the next phase.

For more information about

Programme Management

Activities please click link.

Outcomes

The outcomes as outlined in

the phase roadmap diagram

detail the specific outcomes to

be achieved as a result of the

completion of the activities as

outlined in the respective

phase. Successful achievement

of these outcomes is a

prerequisite for the beginning

of the next phase of the

transition.

ESD Transition

Principles

In order to guide the successful

completion of an ESD

transition a number of key

principles have been outlined

throughout this handbook.

These key principles are to be

used as a guideline when

undertaking the activities

associated with each phase.

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Stage Gate

Process

The Stage Gate Process is used

to examine key points during a

project’s timeframe. At the

end of each phase of the ESD

project, the SRO (Senior

Responsible Owner) is

equipped with a report on the

project’s progression. The

recommendations obtained

from the Stage Gate Process

should prove beneficial to the

overall delivery of the ESD

project.

Stage Gate Process

Unit

A team of reviewers (generally

this will be the cross functional

governance team) will need to

be established to carry out the

Stage Gate Process. They will

be highly specialised in their

respective field and

appointments will be specific

to each stage of the Stage Gate

Process

Gate When Comment

Gate One At end of Assess Phase

The first Stage Gate examines whether all possible outcomes and ESD option have been duly considered. In addition, the Review makes that sure that risks, benefits and costs have been identified and that resources are in place to ensure the ESD project will be successfully managed. The strength of the Business Case should also be confirmed.

Gate Two

At end of Prepare Phase

This Stage Gate ensures that essential preparations in relation to market/supplier assessment and key service delivery elements have been undertaken. The review also makes sure that the RFT procedure and criteria have been appropriately determined.

Gate Three At end of Evaluate Phase

The third Stage Gate examines whether an effective methodology is in place for evaluating tenders and that a successful tenderer has been identified. The review confirms that an ESD implementation plan is in place. At the conclusion of this review, the public entity should be able to confirm the Business Case and move forward to contract.

Gate Four At end of Commit Phase

This Stage Gate ensures that necessary arrangements are in place prior to the contract being finalised. The Review checks that contract details with the successful supplier have been clarified, that value delivery has been assessed and that a design has been finalised for the Retained Organisation Structure.

Gate Five At end of Transition Phase

The fifth Stage Gate examines whether services and process have been successfully transitioned to the supplier. The review ensures that all stakeholders are committed to the ESD project and that there is ongoing strategic communication between the public entity and the supplier.

Gate Six At end of Optimise Phase

This Stage Gate evaluates whether the ESD project has successfully implemented and that there is continuous monitoring of all aspects of the ESD project. The Review also examines if the benefits forecasted in the Business Case have been achieved.

Final Report

When the Stage Gate Process ends, the SRO is sent a draft report. The SRO then has a specified period of time in which to edit any errors before the report is made final. Any learnings from the report can be used to provide advice to Government departments or agencies.

Exit

ESD Framework Phases

Chapter 1 – The Assess Phase

Chapter 2 – The Prepare Phase

Chapter 3 – The Evaluate Phase

Chapter 4 – The Commit Phase

Chapter 5 – The Transition Phase

Chapter 6 – The Optimise Phase

Chapter 7 – The Exit Strategy

Asse

ss

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Chapter 1

The Assess Phase

Assess Phase - Overview

The overall objective of this

phase is to determine whether

or not ESD should be pursued

as an option and, if so, to

develop an initial

understanding of the likely size

and shape of the ESD initiative.

This view must be

complemented with a mature

view of the strategies to be

adopted when looking at

critical areas such as overall

ESD initiative scope, risk,

location and sourcing

strategies.

A key element of this phase is

to identify all key stakeholders

in order to engage with them

early in the ESD process. This is

especially critical where those

stakeholders have little or no

experience of ESD.

Expectations set in this initial

phase will be difficult to change

later in the process.

The Assess Phase ensures that

due consideration is given to all

key aspects of the ESD lifecycle,

particularly with regard to:

The overall objectives for

the ESD initiative, which

should be more than

simple short-term cost

reduction.

The financial benefits

which can be delivered by

an appropriate ESD

contract.

The costs which will need

to be incurred in order to

deliver these benefits.

The risks which must be

mitigated in order to

ensure a successful

outcome.

The conducting of a market

assessment of suppliers

where appropriate.

The overall size and shape

of the ESD Initiative,

ensuring that this is aligned

with business

requirements.

The degree of change

required in business and IT

functions in order to

ensure that ESD is

successful for the full

lifetime of the contract.

Assess Phase - ESD Transition Principles

Engage stakeholders

early

Strong and frequent senior

stakeholder support will be

required throughout the ESD

project, so it is of critical

importance to ensure that all

stakeholders understand the

scope and scale of the project

and the support that they will

be required to give. Any

stakeholders who are known

to be resistant to the project

must be tackled head on, with

the understanding that they

might be right!

Build the right project

team

Do not underestimate the

effort required to manage,

drive and complete the ESD

journey. A wide range of skills

will be required, some of

which may not exist in the

organisation. Starting with a

team which is too small or

which does not have all of the

skills required will lead to a

drawn out or incomplete

project initiation, where what

is needed for success is a quick

and thorough launch.

Lift the rocks

Tackle known or potential

problem areas early and put

pragmatic plans in place to

tackle these in advance of

starting the procurement

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process. There may be a

number of discrete projects

required to ‘get fit’ for ESD,

but it is cheaper and more

effective to tackle these prior

to contract signature rather

than passing the risk and

mediation cost on to the

supplier. Even if the ESD

initiative falters or fails the

internal standards will have

been improved.

Manage suppliers

Once there has been market

engagement any contact with

potential suppliers will need to

be carefully managed to

ensure that business

expectations remain under the

control of the project team

rather than being driven by

supplier hype. Suppliers may

attempt to bypass the project

team in order to gain direct

access to stakeholders and this

will need to be clamped down

on early, with the full support

of the stakeholders, in order to

ensure a level playing field for

supplier evaluation and ESD

initiative construction.

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Relationship Engagement

Some of the core activities

where relationship

engagement is especially

important are:

1. Identifying suppliers: In

order to build any

successful relationship, it

is important to fully

understand what kind of

supplier you require.

2. Cultural matching: Ensure

as much as possible a

cultural fit between the

supplier and your

organisation. There should

at least be some degree of

understanding between

both parties in how each

other operates.

3. On-going contract

management: It is

important to maintain

internal expertise to

manage KPI’s and to retain

the capacity to challenge.

You may need to consider

using different plans such

as a communications plan,

a transitioning plan and an

exit plan to ensure all

aspects of the ESD project

are being managed

effectively.

4. Exit planning: Planning to

exit a contract can raise

various issues in the

relationship between your

organisation and the

supplier. Thus it is

essential to include exit

provisions in the original

ESD contract. Suggestions

for inclusion might be: If

the contract is signed and

the relationship fails, how

do you pull out and ensure

minimum disruption?

What to do if the

relationship fails early in

the contract? Who pays if

the contract is

terminated? Does the

situation differ depending

on which party ends the

relationship? How will

assets be returned? How

will work in progress be

handled? Further

information on exit

planning can be found in

Chapter 7 of this

handbook – The Exit

Strategy Chapter.

5. Launching: There are a

number of factors are

important to consider

when launching an ESD

initiative:

Proper time management is

essential.

Expectations should be

aligned and contingencies

planned for.

If applicable manage the exit

of the current provider.

Make sure internal

stakeholders are aware of the

new process and new supplier.

Manage IR issues as and when

they arise.

6. Trust: This is a key issue

and is dependent on the

type of supplier

relationship you have.

Trust issues are most

relevant in situations

where the focus is on

transforming services

rather than reducing costs.

Complacency or a

breakdown of trust is a

common cause of failure

in ESD relationships.

Furthermore, it is

important to remember

that the relationship is not

always equal and that the

public entity should retain

control of the contractual

relationship at all times.

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Assess Phase - Roadmap

The Assess Phase roadmap defines the key tasks to be completed during the Assess Phase and the

outcomes to be achieved.

Preliminary business case template

Process assessment template

Communication plan

Quality customer service initiative guidelines

Government policy on ‘property and asset management ‘

Public spending code

1. Assess Phase Activities

Assess Phase Tools And Templates

1.1 - Complete Initial ESD Assessment

1.2 - Develop Baseline & Preliminary Business Case

1.3 - Scope Transition & Assess ‘As Is’ Process

1.4 - Determine & Agree ESD Transition Principles

1.5 - Identify, Assess & Manage Risks

1.6 - Assess ESD Options

1.7 - Assess Location & Estate Considerations

Assess Phase Stage Gate

‘As Is’ Model & Baseline

Preliminary Business Case & ESD Scope

ESD Sourcing & Location Options

Initial Risk Management Strategy

Outcomes

Programme Management Office Activities

Mobilisation, Project Governance & Risk Management

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1.1 Complete Initial ESD Assessment

In assessing services that could

be delivered as part of an ESD

initiative the following decision

matrix should be employed

early in the Assess Phase. Once

shortlisted the services should

undergo the detailed

assessment and preparation.

The decision matrix is like a

funnel with a large volume of

ideas entering the left hand

side, with only a few meeting

all criteria and getting on the

shortlist for ESD.

1.2 Develop Baseline & Preliminary Business Case

This is the first and arguably

most important step in the ESD

lifecycle. The initial business

case will define:

The scope and timescales

of the ESD project.

The shape and size of the

ESD project.

The pace of change

necessary to deliver

required benefits.

All of these will impact the

whole of the project and the

subsequent ESD contract.

Developing a realistic initial

business case will require a

thorough assessment of

existing spend, which can be

challenging if this is not

currently under the control of a

single Department, Agency,

Division or Section (e.g. for IT

ESD initiatives it is often the

case that business units retain

responsibility for some IT

provision alongside a central IT

function).

Baselining is a key part of this

process to ensure that current

service levels are fully

understood and that any future

contract ensures at least the

same level of service if not a

marked improvement. When

looking at value an eye must be

kept to maintaining quality

customer service. See the

quality customer service

initiative guidelines.

The other critical dimension to

the business case is the setting

of challenging yet realistic value

goals. Many first generation

ESD initiatives were focused

exclusively on cost reduction,

with some considering only

It is government policy that all proposed new services be evaluated for ESD as per

Public Spending Code guidelines.

Are the services non-core to departmental/agency purpose or operations? Is it a new or discreet service?

Long list of service providers for ESD

What is the level of standardisation for the services? What is the current and expected demand volume for the services?

What is the level of complexity and/or uniqueness of the services?

Could an external service provider deliver the services more efficiently and/or effectively?

Are suitably experienced external service providers available?

Short list of services to consider for ESD

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short term rather than full

contract term reductions in

cost. As more complex and

sophisticated ESD models have

emerged it has become easier

to focus on the addition of

value, typically through

improved levels of service or an

increased ability to deliver

innovation whilst still ensuring

that overall costs are reduced.

Any failure to set goals in line

with the real business objective

of the ESD initiative runs the

risk of setting the project off in

the wrong direction, leading at

best to a waste of elapsed time

and cost and at worst to an ESD

arrangement which is designed

to fail to meet the real

objectives.

A Preliminary Business Case

Template (1) is available at

http://esd.per.gov.ie/guidance-

and-resources/. A business case

should be completed in full

during this phase.

1.3 Scope Transition & Assess ‘As Is’ Process

Whilst it is tempting to think of

the scope of an ESD initiative in

terms of the impacted

organisation, technology

(mainframe, storage, desktop

etc.) or business products

(invoices, expense claims), early

consideration of the maturity

and coverage of current

processes will add clarity to the

overall process. This will help to

eliminate any perceived

‘boundaries’ between client

and supplier as the ESD

initiative progresses.

Once an ESD initiative is

operational it is the process

handover points which will

drive many of the day to day

interactions between supplier

and client, with the client

retained teams existing to

execute those processes

deemed to be out of scope.

Whilst ‘as is’ and ‘to be’

processes do not need to be

modelled in detail at this early

stage, it is important that all

key process areas are reviewed

and understood. Particular

emphasis should be given to

the processes relating to the

management of the suppliers.

If there is no history of ESD

within the organisation then a

number of new processes will

need to be created and for

existing processes the focus will

be on agreeing the division of

responsibilities between the

client and supplier.

Although the detailed scope

and nature of the ESD

agreement will not yet be

known, consideration should

also be given to the governance

model under which the

contract and the supplier

relationship will be managed.

Early communication of this will

help to demonstrate a carefully

thought through and

professional approach to the

ESD relationship from the

outset and will ensure that

supplier expectations and

behaviours are managed in a

structured and efficient

manner.

Process assessment templates

(4) are available by clicking the

link.

Departments may be hesitant

on changing in-house service

delivery to ESD due to a

potential loss of control. To

overcome this responsibility

should be assigned to one

person for overseeing the

relationship and deliverables

with any new supplier. This will

safeguard that services are

properly monitored, ensuing

service quality and mitigating

against a sudden relationship /

service breakdown.

Understanding the contract and

the core deliverables will

ensure this SRO manages the

supplier contractual obligations

thus retaining control of the

relationship. Ultimate

accountability for the service

provision rests with the

contracting authority at all

times.

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1.4 Determine & Agree ESD Transition Principles

Following an ESD transition all

departments must still comply

with the same public service

policies and standards as prior

to ESD. This includes when a

department is delivering

services for another

department.

As well as the principle of

maintaining accountability,

other key principles that should

be adhered to include value for

money; improved customer

service; evidenced based

decision making; a transparent

and fair process and an exit

mechanism that is understood

by both parties. Caution is

urged around service delivery

and contract management

issues.

1.5 Identify, Assess & Manage Risks

Risk assessment and risk

management are key

structuring activities that

should be carried out initially in

the Assess Phase and

continuously managed

throughout the subsequent

phases. Consideration of the

major ESD initiative risks should

cover both internal risks,

providing a view of mitigation

actions, and external risks,

which are inherently harder to

mitigate but should still be

assessed and understood.

Typical internal risk areas include:

Risk Area Description Mitigation

Stakeholder

Adoption

The ESD initiative needs active and visible

support from senior business and leaders,

which may not be forthcoming.

Senior stakeholders must be fully engaged during the

Assess Phase with a communication plan (5) being

followed to keep them on board.

Cultural

Resistance

Any inherent reluctance to change within the

client organisation can slow down or even

derail the ESD initiative.

The content, timing and style of communication need to

be sensitive to the organisational norms. Representative

groups (e.g. unions and works councils) will need to be

consulted in line with regulatory and legal requirements.

Internal

Resource

Capacity

Critical resources with detailed knowledge of

the current environment are tied up with their

day job and unable to contribute to the ESD

initiative.

External resource may need to be brought in to backfill

critical resources for the duration of the ESD initiative.

Supplier

Management

Many clients have little experience of ESD and

run the risk of being dictated to by the

supplier marketplace.

The effort required to properly manage the

procurement process and the potential rewards this

brings need to be recognised during the Assess Phase.

Where needed external support should be sought.

Strategic

Objectives

Supplier activities may be inconsistent with

strategic and financial goals and objectives of

the organisation.

Clear communication plans (5) should be developed to

ensure the supplier fully understands the strategic and

financial goals and objectives of the organisation.

Legal and

Compliance

Public entities and suppliers must be aware of

any legal and regulatory obligations the ESD

initiative may be subject to. These can include

obligations under such areas as powers and

Formal legal advice may be required in some instances.

Guidance should be sought from relevant regulatory

bodies (E.g. Data Protection Commissioner). Contracts

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functions, confidentiality, data protection,

ethics etc.

must be constructed to reflect legal and regulatory

requirements.

Procurement

Procedures

There are a number of potential risks

throughout the procurement procedure such

as competition delays, gaps in knowledge, lack

of clarity or information in specifications,

incorrect qualification or award criteria, legal

challenge to competition and termination

date of contract with existing supplier.

Sufficient time must be allowed for comprehensive

planning and completing the public procurement

competition. Guidance and advice should be sought at

this early stage from the relevant entities/advisors.

Planning the procurement competition and drafting the

procurement documentation are interconnected and

should be conducted simultaneously during the Prepare

Phase of the project.

External risks, such as those

arising from business

acquisitions or mergers and

acquisitions within the supplier

base during the course of the

ESD initiative should also be

considered. Whilst these are

difficult to mitigate, an impact

analysis should be completed

and a contingency plan

established. At this early stage

it is also worth defining a clear

set of ‘deal breaker’ risks which

may cause the ESD

procurement process to be

significantly re-scoped or even

terminated and ensuring that

senior stakeholders are aware

and supportive.

A risk management plan that

includes reasons why a service

identified is a good one for ESD

such as identification of areas

of low capability and high

capacity in each department is

important. This plan should

include effective mitigation

strategies such as to retain a

public sector comparator for

example. Another might be

where the service identified is

characterised by high policy

uncertainty, the mitigation

strategy might involve drafting

short-term flexible contracts

instead of fixed long term ones.

Public entities should use the

Office of Government

Procurement’s (OGP) RFT and

contract guidance documents

whilst preparing their RFTs and

contracts. The documents are

available at

www.procurement.ie. The RFT

guidance document contains

risk identification information.

Many risks relating to

confidentiality are dealt with by

the template confidentiality

agreement which forms an

integral part of the OGP suits of

tender documentation.

General guidance on risk

management is available at

http://www.reformoffice.per.g

ov.ie/resources/

Risk identification and risk

management templates can be

used to:

Identify the processes and

sub processes that are

potentially at risk.

Identify and describe risk

categories and risk sub

categories in relation to

the processes / sub

processes.

Assess the likelihood,

impact and severity of the

risk.

Identify the impacted

services and the service

user impact.

Determine a risk

management approach.

Assess the risk

management options.

Evaluate the status of the

risk.

Identify a risk owner.

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1.6 Assess ESD Options

1.6.1 Approach

Potential Suppliers

Assessing whether there are

appropriate services and

service providers in the market

is an important step in the

Assess Phase of an ESD

initiative.

Public procurement rules place

restrictions on directly

approaching a supplier without

following appropriate protocol

so EU and National public

procurement guidelines must

be followed. Great care should

be taken in undertaking such

an exercise to avoid

preferential treatment of

potential suppliers that

participated in discussions with

the public entity. Therefore, it

is important to follow the law

and procedures so as not to

prejudice the process.

1.6.2 Assess Sourcing

Options & Create

Sourcing Strategy

The ESD market has become

far more sophisticated in

recent years, presenting clients

with a wide and potentially

confusing range of options to

consider. In order to focus

activities for the ESD initiative

as a whole and to avoid the

temptation to ‘circle back’ to

constantly review options and

choices, it is necessary to

undertake a thorough, honest

and transparent evaluation of

all options.

These will typically include:

ESD to a single supplier.

Adoption of a multi-

supplier model (i.e. multi

party framework), with

individual technology

towers or business

products being tendered

for by multiple suppliers.

Adoption of a multi-

supplier model where

individual subsets of the

above areas are tendered

separately.

Use of a hybrid approach,

with some functions

remaining in-house whilst

others are procured

externally.

Retention of physical

assets (especially

buildings) versus selling off

of assets as part of the

contract.

One of the well marketed

advantages of the use of ESD is

the ability to benefit from the

economies of scale which the

suppliers enjoy, with delivery

of this benefit usually being

dependent on the completion

of a transformation exercise

which better aligns the in-

scope processes and

technologies to those of the

selected supplier.

Using cross-departmental ESD

service provision where

services are common can

realise great savings for the

public service. Project

managers with a live ESD

Enterprise Ireland is committed to working with Public Sector buyers and supplier

companies to facilitate and maximise the contract opportunities available to small

and medium-sized enterprises (SMEs) through the public sector in Ireland.

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programme of work should

always be looking at their own

and other departments with

related services to see if one

provider could successfully

deliver more than one service

thus enabling them to possibly

undercut their competitors

pricing and facilitate greater

savings for the department. In

this instance however, caution

is required to ensure

monopoly suppliers are not

created.

It is imperative that the

sourcing strategy gives careful

consideration to the option of

completing any

transformational activities

prior to ESD and that it takes

into account the fact that the

post-transformation

organisation may deliver a

level of quality and value for

money which dilutes, or even

negates, the value of ESD. The

key challenges to this approach

are the availability of sufficient

in-house resources to

undertake the transformation

whilst maintaining existing

operations and the feasibility

of reskilling a large workforce

to operate efficiently in the

post-transformation

organisation.

1.6.3 Assess ESD

Market

Market assessment can come

in the form of talking to public

sector project managers of the

many ESD initiatives already

taking place across

Government; talking to

suppliers on the latest

innovation solutions that are

available and consultation with

government bodies such as the

Office of Government

Procurement and Enterprise

Ireland who have an

understanding of the market.

All of this is allowable in the

market assessment phase prior

to release of an RFT ensuring

to comply with EU and

National Procurement

Guidelines at all times. During

any interaction with the

market, contracting authorities

must not either prejudice or

prefer any potential supplier

within the market.

Talking to the market before

tendering makes it possible to

obtain the views of the market

before starting the tendering

process. This allows potential

suppliers the opportunity to

better understand the problem

to be addressed and to suggest

alternative solutions to the

procurer.

Write a high-level

procurement plan for the

coming year. This is

important for any large

complex contracts.

Communicate your plans

as early as possible. This

can be done by publishing

a Prior Information Notice

(PIN) on etenders. The

publication of a PIN is

encouraged for services in

excess of €750,000 per

annum;

Should you decide to

assess the market at this

stage you should consider

attaching a request for

structured submissions to

your PIN to assist you with

your market analysis;

Contact enterprise Ireland

who can give you access to

potential suppliers who

have experience in

delivering successful

projects to the public

sector in Ireland and

overseas, attention can be

brought to your PIN and

its attachment;

If you decide to wait until

later in the assess phase

(post-PIN) you can issue a

Request for Information,

prior to formulating any

request for tender, and in

it issue a request for

structured submissions to

assist with your market

analysis;

Consult with numerous

potential suppliers and

supplier bodies. The

engagement process must

be consistent and

transparent. Ensure a clear

engagement

process/script and record

notes on each

engagement;

You can discuss

commercial solutions,

such as pay rates, spans of

control, how they manage

TUPE, technology, etc.

with potential suppliers to

inform your business case

but you cannot share your

detailed business plans or

costs;

You must consult with the

office of government

procurement.

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1.7 Assess Location & Estate Considerations

1.7.1 Location Strategy

A discrete location strategy is

required where buildings are

to be sold to the supplier as

part of the ESD initiative and

where additional location-

sensitive capacity is to be

provided by the supplier.

The location strategy will be

shaped by a combination of

logistical or technical factors.

These typically relate to the

physical limitations on where

processing can be performed

relative to the locations of

users and regulatory and legal

factors, which will determine

who can handle which data in

which locations.

Any decisions in respect of

location and estate

management should be

aligned with current

Government Policy on

‘Property and Asset

Management’.

1.7.2 Estate Portfolio

Strategy

An estate portfolio strategy

will result in a comprehensive

list of all current buildings. It is

important to decide at this

early stage what is to happen

all buildings (if anything) in the

event of an ESD project going

live.

1.7.3 ‘As-Is’ Locations

An examination of all current

locations should be done to

establish if they are suitable

for the revised organisational

structure once the ESD project

has gone live. This is key at this

stage. A sound costing of any

necessary modifications should

be included in the business

case.

Importantly if there is a need

for financial investment to

remain ‘as-is’ this should be

considered at this stage.

Increased formality of supplier approach and use of OGP guidelines

Incr

easi

ng

leve

l of

det

ail

and

dir

ect

inte

ract

ion

wit

h s

up

plie

rs

Initial Market Scan • Internet and desk research • General / industry conferences &

events • Industry analyst reports

Market Assessment • Enterprise Ireland and

representative bodies such as IBEC

• Internal networks to understand existing supplier relationships with public service

• OGP internal information

Contact with Supply Market • Informal discussions with

potential suppliers subject to CSSO/OGP/legal advice

• Issuing a PIN in the OJEU

The CSSO is the Chief State Solicitors Office and provides legal advice to the civil

service in relation to the procurement process and contract

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NRA Case Study – The Assess Phase

An Environmental Impact

Statement (EIS) was prepared

for the M50 Upgrade Scheme

identifying the West-Link toll

facility as a contributing factor

to delays experienced by road

users on the M50. The EIS

presented the case that a

barrier-free tolling system

would unlock significant

additional benefits for users

and the environment than

would otherwise have been the

case with a conventional plaza

tolling. In particular, the EIS

identified that the proposals

would increase the capacity of

the Motorway, enabling road

users including buses, taxis,

commercial vehicles and

private cars to benefit from

significantly reduced traffic

congestion and increased

average traffic speeds both on

the M50 and also on the radial

routes approaching the M50.

The replacement and upgrade

of the tolling system was

therefore a critical element of

the overall M50 Upgrade

Scheme.

The NRA engaged with the

incumbent toll operator, NTR

(who had contractual rights to

collect tolls on the “Westlink”

(Junction 6 to Junction 7)

section of the M50 until 2020),

to explore the possibility of

varying the West-Link contract

arrangements to change the

tolling arrangements to barrier-

free tolling. The NRA ultimately

concluded that it was not

feasible to negotiate such

changes to the West-Link

contract and comply with

procurement regulations.

Furthermore, it was identified

that it would be difficult to

demonstrate ‘value for money’

from a negotiated agreement.

The NRA, with the agreement

of the Government, took the

decision to “buy-out” the NTR

West-Link contract and to run a

tender competition to appoint

an entity to design, build and

operate a new barrier-free

tolling system.

ESD was the optimum solution

as this was the first project of

this nature in Europe for a

number of reasons including

the fact that there was a lack of

resources, skills, and

experience within the NRA to

fully resource such an

operation. Additionally, the

new operation was required to

work “at full steam” from the

first day as there was no ‘ramp

up’ phase. Furthermore, as the

motorists would directly

interact with the new

technology the impact/results

of the project would be highly

visible.

Engaging and managing

stakeholders:

The introduction of barrier-free

tolling required the support

and cooperation of a number of

key stakeholders and

establishment and

management of good working

relationships. This included the

Department of Transport as the

NRA’s sponsoring department

as well as the Driver Vehicle

Computer Services Division

(formally the Vehicle

Registration Unit) based in

Shannon as manager of the

National Vehicle Owner

Register which is used by the

tolling system to identify all

vehicles registered in the State,

the Data Protection

Commissioner with regard to

protection of road users privacy

across a number of areas and

the Courts Service with regard

to the enforcement process

and plan for the treatment of

toll evaders / violators. The

NRA also had to engage with

private sector industry bodies

including, for example, the Car

Rental Council and the Vehicle

Leasing Association of Ireland.

Ascertaining the list of services

that could be provided by ESD:

The tolling system and

services were procured

using a design, build and

operate contract with an

eight year term (and with a

three year extension

option).

The NRA, in March 2007,

appointed BetEire Flow (a

French consortium of two

major French firms - Sanef

and CS), to design, build

and operate the tolling

system. Sanef manage the

tolling business along with

their key partners/

suppliers:

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1. Customer Management –

Abtran.

2. Payments & Billings –

Payzone.

3. Logistics – Realtime

Technologies.

4. Post – PrintPost.

5. Enforcement – Pierse &

Fitzgibbon Solicitors.

This contract is much more

than providing a service to the

NRA – it is really about

managing the tolling business

on the NRA’s behalf.

Challenges, benefits and risks:

In preparing and planning for

the introduction of the new

barrier-free tolling system the

NRA team were aware that the

project entailed certain

characteristics and risks which

would make it one of the more

challenging projects delivered

by the NRA in recent times.

Launching the operation of a

new type (“first generation”) of

electronic road pricing on the

busiest motorway in the State

presented challenges which

included:

Concluding an agreement

for the termination of the

NTR West-Link toll

concession.

Preparing supporting

legislation for barrier-free

tolling including a new Toll

Scheme and Bye-Laws.

Engaging with a broad

range of stakeholders.

Migrating ‘on the ground’

from the barrier operated

toll facility to barrier-free

motorway tolling.

Embarking on a nationwide

public awareness campaign

on the new tolling

arrangements including

the launch of the eFlow

tag.

The benefits from barrier-free

tolling on the M50 were

broadly summarised as follows:

Less congestion - no

stopping or slowing down

at a toll plaza.

Faster journey times –

increased average speeds.

Less land take.

Less pollution.

Better air quality.

The advantages of barrier-free

tolling are offset somewhat by

risks related to the potential for

increased levels of revenue

leakage with free-flow systems,

additional risks associated with

the introduction of new

technology and the uncertainty

surrounding operating costs -

as there is very little historical

cost data available on the new

technology for road operators

and infrastructure managers.

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Key Points to Remember

Any significant issues with

current provision will become

obvious during the remainder

of the ESD initiative process, so

tackle them up front.

Set expectations

appropriately

Both with senior business and

leaders and, where

appropriate, with staff who

may be impacted by any ESD

initiative. Do not

underestimate the effort which

will need to be focused on

internal stakeholder

communications and

management.

Manage resources

carefully

There will be key in-house

team members who are the

main, or even sole, experts in

critical areas. Consequently, it

is unlikely that they will be free

to work on the ESD initiative

on a full-time basis, so their

input needs to be optimised.

Project timelines

Ensure that the timelines are

reasonable and are sufficiently

long enough so that the

procurement process and

project aims can be met.

Risk management

Identify risk together with

mitigation measures at an

early stage.

End of Phase Checklist

Have you assessed the

proposed ESD service

using the high level

decision funnel (Page 1-

4)?

Agreed business case: The

high level business case

for ESD should clearly set

out all the costs and

benefits of the ESD

initiative.

Clearly defined scope: The

size and shape of the ESD

initiative should be well

understood and clearly

communicated in terms of

organisation and key

processes.

Managed risks: Both

internal and external risks

associated with the ESD

initiative should be

understood by all

stakeholders, with

mitigation plans and

actions established.

Sourcing and location

strategies: The strategic

approach to the sourcing

activities of the initiative

should be clearly defined,

with clear linkage between

the sourcing strategy and

the assumptions in the

business case.

Technical architecture

approach: The extent to

which the technical

architecture is to be

dictated to potential

suppliers rather than

being left to their

discretion should be

clearly communicated,

with a clear understanding

of where potential

suppliers must conform

and where they can

innovate being shared

across all stakeholders.

Available Tools

Business Case Template (1)

Risk Assessment Tool (6)

Process Assessment Template (4)

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Pre

pare

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Chapter 2

The Prepare Phase

Prepare Phase - Overview

This phase moves from the

initial decision to proceed with

an ESD to the preparation

involved prior to issuing a

Request for Tender (RFT).

The Prepare Phase is the crucial

step in the ESD lifecycle, as it

initiates the first formal

engagement with the

supplier(s) and defines the

public entity’s detailed service

requirements which will be

delivered under the contract.

The Prepare Phase ensures

planning the procurement

competition and drafting the

relevant documentation are

treated as interconnected

aspects of the ESD. There is

also a large amount of internal

stakeholder management

activity within the public

authority during this phase.

Due consideration must be

given to the following key

aspects of the Prepare Phase:

Consider the requirements

in relation to the services

being sought when

determining specifications,

evaluation, qualification

and award criteria. It is

important that the

specifications that issue as

part of the RFT reflect the

scope of the services

sought, contain sufficiently

detailed information and

costing factors for

tenderers. Particular care

should be given to drawing

up the specification for the

service as this will

determine the quality of

ESD services that will be

delivered over the lifetime

of the contract;

Develop future processes

and agree internally. These

are used to define the

future organisation

structure and will form

part of the RFT;

Determine the appropriate

/ relevant tendering

procedure;

Agree qualification and

award criteria for insertion

in the RFT;

Communicate the scope of

services to be procured

and discuss key business

Critical Success Factors

(CSFs) internally within the

public entity;

Complete the OGP suite

RFT which include

necessary documentation

such as the contract and

confidentiality agreement;

Ensure a risk assessment is

conducted on the public

procurement competition

documentation prior to

issuing and obtain

advice/guidance from

relevant bodies such as the

OGP (Office of Government

Procurement) and CSSO

where necessary.

The OGP suite of documents

can be used across the public

sector and are suitable for most

ESD projects which will be run

as open procedures. Where a

procedure other than open is

used then a standalone

template contract (the same as

used in the template RFT) is

also available at

www.procurement.ie. The OGP

is in the process of preparing

template framework

agreements. Queries in relation

to the suite of template

documentation may be

directed to the OGP.

Effective stakeholder

management is crucial in order

to obtain final approval for

contract development.

Security and control also need

to be taken into account with

security (and where

appropriate risk and regulatory)

approval being a pre-requisite

for contract development.

Throughout the development

of the ESD contract it is

common for support to be

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sought from lawyers, specialist

consultants, bench markers and

other professional advisors.

The process for defining the

services is driven by the level of

understanding that the public

entity has of its requirements.

In some cases (for example, a

second generation ESD

project), it may be possible to

use existing service definitions

as the basis. In other cases, due

to complexity, the competitive

dialogue process is used to

identify solutions.

In all cases it is important to

differentiate between the

service definitions (i.e. the

requirements) and the solution

(i.e. how each tenderer is

proposing to meet the

requirements). The service

definition is typically drafted by

the client while the solution is

provided by the suppliers. In

addition to the on-going

services (e.g. business

processes) the service

definition will also describe any

transition information and exit

requirements. The supplier may

also help further shape the

definition especially if service

improvements from the current

model are sought.

Prepare Phase – Key ESD Transition Principles

Determine the

appropriate Tendering

Procedure

The Public Procurement Law

permits four procurement

procedures: Open, Restricted,

Competitive Dialogue and

Negotiated Procedures.

Choice of RFT style

Make a decision on the style

(from highly prescriptive to

descriptive) and structure

(from one-size-fits-all to

modularised) of the RFT based

on the appropriate

procurement procedure.

Determination of

Evaluation Criteria

The requirements in relation to

the services being sought

should be considered carefully

when determining

specifications, evaluation,

qualification and award

criteria. The award criteria and

weightings/marks must be

defined in RFT.

Clear articulation of

supplier proposal

requirements

These should be clearly

articulated and be informed by

the evaluation criteria used in

the next phase to support a

consistent evaluation across

suppliers. The pricing

response requirements should

also be well defined to enable

like-for-like comparison and

effective scenario modelling.

Contract for outputs

All aspects of the contract,

from service descriptions and

transformation to service

levels should be described in

terms of deliverables that the

client requires (unless there

are specific reasons not to).

This focuses the contract on

what is important to the client

and allows the suppliers to

develop the most appropriate

solution.

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Prepare Phase - Roadmap

The Prepare Phase roadmap defines the key tasks to be completed during the Prepare Phase and the

outcomes to be achieved.

Public Spending Code

RFT and Contract Template for Services

NPS Guidelines and EU Public Procurement Law

Risk Assessment Guidelines

Risk Assessment Tool

Public Procurement Guidelines

2. Prepare Phase Activities

Prepare Phase Tools And Templates

2.1 - Prepare ESD Scope & ‘To Be’ Process

2.2 - Determine Delivery Structure

2.3 - Define Operating Model

2.4 - Develop Pricing Model

2.5 - Prepare for Supplier Selection

2.6 - Define Services & Develop Specifications

2.7 - Prepare RFT

2.8 - Prepare Stakeholders for ESD Transition

2.9 - Define Retained & ‘To Be’ Org. Structure

Prepare Phase Stage Gate

Detailed ‘To Be’ Supplier Engagement/ Governance Model and ESD Requirements

RFT Criteria and Documentation

Outcomes

Programme Management Office Activities

Mobilisation, Project Governance & Risk Management

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2.1 Prepare ESD Scope & ‘To Be’ Process

2.1.1 Integrated

Process Design

The objective of this activity is

to develop the integrated

process design which will meet

the client’s process

requirements. These will

include key inputs and outputs

for each stage of the processes

being defined.

Close collaboration with the

customer of the services (e.g.

business users) is vital at this

stage, to ensure a smooth

process transition without

significant hurdles and

operational risks.

2.1.2 Analyse

Benchmarks & Leading

Practices

Throughout this activity,

leading practices and

benchmarks can be used as the

blueprint for the process

designs, although these need to

be customised to meet the

individual needs of the client.

2.1.3 Industrial

Relations

Some items that must be

considered include:

The provisions laid out in

the Public Service

Agreement and the

subsequent Public Service

Stability Agreement;

The Transfer of

Undertakings, Protection

of Employees (TUPE

Legislation) and ESD;

Terms and conditions of

employment and ESD;

Pension provisions and

ESD.

These are important areas of

specialism which this handbook

does not deal with in detail. No

ESD project should be

progressed without consulting

your organisations IR/HR

specialists.

2.2 Determine Delivery Structure

2.2.1 Determine the

Appropriate Structure

The objective of this activity is

to develop the ESD initiative

structure based on the overall

risk assessment. The ESD

structure will set out the key

principles and objectives of the

ESD initiative, define success

factors and produce financial

models. These will be used as

the basis for developing RFT

and contract documentation

which will also be used in

communicating the key

objectives to the suppliers.

Choosing the correct model

and appropriate structure from

the various frameworks and

models for external service

delivery is important. A local

ESD model could be used for

small to medium sized

procurements providing

opportunities for indigenous

suppliers and reducing single

point of failure risk. Possible

local ESD models include multi-

sourcing models where there is

a either a single lead supplier

responsible for sub-suppliers or

mixed suppliers which may help

reduce dependency and lock-in

risk.

2.2.2 Reassess Risk

Once the specifications have

been drafted a risk assessment

should be carried out on the

RFT and contract

documentation before

advertising the RFT. The project

team should ensure the

contract notice (where utilised)

does not conflict with the RFT

provisions. The RFT should be

cross checked against the

contract notice prior to issue.

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2.3 Define Operating Model

In the Irish Public Service,

the governance model

should be established early,

before the Business Case.

Depending on the type of

ESD initiative it is, there are

differing governance

models. For instance, if

outsourcing a stationary

supplier robust contracts,

contractual governance that

takes service management

and contractual remedies

into account would suffice.

For process innovation and

subsequent relational

governance, a typical ESD

governance structure

should include a project

board (with key

stakeholders); a project

team, and a steering board

(including the project

manager from the project

team, and possibly more

members of the project

team). The project team

should include the

programme owner; a

finance expert; a HR person

with access to legal advice;

ICT and subject matter

experts in areas such as

procurement. This

governance model will

determine what needs to be

managed and overseen at

each phase of the ESD

process as determined by

the project board, steering

board and project team.

2.4 Develop Pricing Model

At its core the pricing model

will answer the question: ‘how

much will the charges be at any

given time and under any given

scenario’. Although ultimately

it will be included in the

contract, the pricing model may

begin as a spread sheet which

is designed by the public entity

and included in the RFT. This

pricing model must be

reflective to the ESD services.

The pricing model should

include all foreseeable charges

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and cater for all likely scenarios

in order to provide

predictability for the contract

(and good long term value to

the client). In addition to the

charges, it is not uncommon for

a pricing model to include some

information on the composition

of the charges. For example:

breakdown of charges into

people, property, hardware and

software. This can aid the

client in understanding cost

drivers and comparing

solutions. Elements of the

pricing model will depend upon

the project but can include

fixed cost, per diem rates,

expenses, costs allowed and

phasing costs. The pricing

model must be clearly

constructed so that the market

can cost the project and the

public entity can award marks

on the basis of it.

2.5 Prepare for Supplier Selection

Following the completion of

a business case for the

service that has been

selected for ESD the

guidelines in the OGP suite

of documents should be

followed. The RFT should be

as comprehensive as

possible to minimise the

need for clarifications. The

criteria in the marking

process with weightings for

each should also be

outlined. If price is the sole

criteria, the contract should

be awarded to the lowest

priced bid complying with

the specified requirements.

If using the ‘Most

Economically Advantageous

Tender’ (MEAT) the contract

should be awarded to the

tender that best meets the

relevant published criteria.

Make sure any contract that

is used clearly specifies the

roles and responsibilities of

all involved, what needs to

be done, by whom and how

much it will cost.

If possible, co-ordinate all

potential ESD services to

facilitate suppliers who

could offer cost-effective

services for users with

multiple requirements but

who may be overlooked by

a department that focusses

on a narrow set of

departmental objectives.

Furthermore, it is also

important for departments

who may be thinking of an

ESD initiative to co-ordinate

and connect with similar

services in other

departments, thus

potentially achieving

economies of scale.

It is important to retain

some in-house expertise to

allow for effective contract

management.

As much information as

possible should be included

in the RFT. The clearer the

detail is in the RFT, the

more likely you are to have

suppliers tendering with an

accurate understanding of

your requirements and their

responsibilities. This way

the service for ESD is more

likely to be awarded to an

organisation that can fulfil

your on-going needs.

2.6 Define Services & Develop Specifications

The department driving an ESD

approach should thoroughly

understand the service they are

considering for alternative

delivery having engaged closely

with both the users and

potential providers. They

should have a clear idea on the

outcomes they want to achieve

and discuss alternative ways of

achieving these outcomes with

expert suppliers.

Specifications should be based

on the needs identified in the

business case with tasks

identified for the supplier and

the ESD project manager

throughout the ESD lifecycle.

Specifications, including

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instructions on who is

responsible for each task

throughout the ESD lifecycle,

should be supplied to new

providers at the start so they

then know what is expected of

them. These instructions will

ensure a clear understanding of

roles and responsibilities.

For example in a call centre

specification, the type of

information included would be:

The amount of rings within

which an incoming call

must be answered e.g. 4

rings;

The amount of outgoing

calls to be made to

potential customers per

hour e.g. 5 calls per hour,

and;

The time allowed for

effectively resolving a

customer’s complaint e.g.

Complaint resolved within

24 hours.

2.7 Prepare RFT

2.7.1 Determine the

Appropriate Tendering

Procedure

The department driving an ESD

project must have a thorough

understanding of

commissioning, focusing on

ensuring long-term outcomes

and value for money. There

are a number of different

options open to public service

bodies when procuring

services.

Before formally starting the

procurement procedure, the

public entity will need to

choose the optimal method

that meets its needs. The

publication of a Prior

Information Notice (PIN; see

page 1-9) provides advance

notice of future ESD needs and

may help to encourage

innovative solutions and SME

participation during the

procurement process.

The most relevant

procurement procedure for

each ESD project will depend

on the value, complexity and

nature of the service involved.

Where the value of a contract

falls below the threshold for

advertising in the Official

Journal of the European Union

(OJEU) particular regard should

be taken of the provisions of

the most up to date circular,

currently (as on 16/04/2014)

circular 10/14 which provides

guidance facilitating SME’s

participation in public

procurement.

For contracts with a value

above the threshold for

advertising in the OJEU, the

procurement procedure

chosen should be fully

compliant with EU

procurement law and national

guidelines. The procedure

must adhere to the basic EU

Treaty principles of

transparency and non-

discrimination.

The EU Public Procurement

Directive permits four

tendering procedures:

Open.

Restricted.

Competitive Dialogue.

Negotiated Procedure.

Key deal breakers are also

defined at this stage, which

will assist in identifying

potential show-stoppers

throughout the process and

assist with supplier evaluation.

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2.7.2 Tendering Procedure Descriptions

Type Description and Instances of Use

Open

Under this single stage procedure all interested parties may submit tenders. Information on tenderers’

capacity and expertise may be sought and only the tenders of those deemed to meet minimum levels of

technical and financial capacity and expertise are evaluated against the award criteria.

If there are minimum requirements it is important that they be made clear in the notice or the request for

tenders (RFT) to avoid unqualified bidders incurring the expense of preparing and submitting tenders.

Restricted

This is a two-stage process where only those parties who meet the qualification criteria in regard to

professional or technical capability, experience and expertise and financial capacity to carry out a project

are invited to tender.

As a first step, the requirements of the contracting authority are set out through a contract notice in the OJEU and expressions of interest are invited from potential tenderers.

The second step involves issuing the complete specifications with an invitation to submit tenders only to those who possess the requisite level of professional, technical and financial expertise and capacity.

Public entities may opt to shortlist qualified candidates if this intention is indicated in the contract notice

and the number or range of candidates indicated. Shortlisting of candidates who meet the minimum

qualification criteria must be carried out by non-discriminatory and transparent rules and criteria made

known to candidates.

Competitive

Dialogue

This procedure was designed to provide more flexibility in the tendering process for more complex

contracts and is an exception to the usual open and restricted procedures.

Public entities must advertise their requirements and enter dialogue with interested parties, (pre – qualified

on the same basis as for restricted procedure).

Through the process of dialogue with a range of candidates, a public entity may identify arrangements or

solutions which meet its requirements. Provided its intention is indicated in the contract notice or in

descriptive documents supplied to candidates, a contracting authority may provide for the procedure to

take place in successive stages in order to reduce the number of solutions or proposals being discussed. The

reduction must be achieved by reference to the award criteria for the contract.

In conducting the dialogue, public entities must ensure equality of treatment and respect for the

intellectual property rights of all candidates. When satisfied about the best means of meeting its

requirements, the contracting authority must specify them and invite at least three candidates to submit

tenders. The most economically advantageous tender will then be selected. Aspects of tenders may be

clarified or fine-tuned provided that there is no distortion of competition or discrimination against any

tenderer.

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Negotiated

Procedure

This is an exceptional procedure, which may be used only in limited circumstances. There are two types of

negotiated procedure:

Public entities advertise and negotiate the terms of the contract. This process should normally involve the submission of formal tenders by at least three candidates (pre-qualified on the same basis as for the restricted procedure provided there are at least this number who meet the minimum qualification criteria) with negotiation on final terms in a competitive process. This procedure may only be used:

- Where the nature of the requirement does not permit overall pricing; or - Where it is not possible to specify requirements for a service with sufficient

precision to enable tenderers to respond with priced tenders and; - Where an open, restricted or competitive dialogue procedure has not

attracted acceptable tenders.

Public entities negotiate, without advertising, the terms of the contract directly with one or more parties. This is a departure from the core principles of openness, transparency and competition and is a very exceptional procedure. The main instances where this procedure may be used are:

- In cases of extreme urgency; - When, for technical or artistic reasons or due to the existence of special or

exclusive rights, there is only one possible supplier or service provider; - When an open or restricted procedure has not attracted appropriate

tenders (provided all those who submitted tenders are included in the negotiations and the specifications of the requirement are not altered substantially);

- Extension of existing contracts and repeat contracts subject to certain limited conditions;

- For the purchase of supplies on particularly advantageous terms, from either a supplier definitively winding up a business or the receiver or liquidator of a bankruptcy, an arrangement with creditors or similar legal or regulatory procedure.

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2.7.3 Tender Procedure: Competitive Process

Depending on the most appropriate tendering procedure the following steps should be conducted to

ensure a fair, transparent, equal and competitive process.

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2.7.4 Develop, Issue

and Evaluate Pre-

Qualification

Questionnaire

A Pre-Qualification

Questionnaire (PQQ) will need

to be developed; issued and

evaluated if using the

restricted procedure. A PQQ is

a questionnaire that suppliers

or contractors must fill out

when bidding for work or

applying for an approved

supplier list. PQQs are useful

tools to identify the most

suitable supplier to invite to

tender for contracts.

PQQs are generally scored

according to the answers given

relating to questions on

company information, financial

situation, expertise, experience

and appropriate policies. There

may be further bidding, but

otherwise the supplier with a

qualification score will be put

onto a list to whom an RFT will

be issued.

A PQQ should ask about an

organisation's:

Status

Finances

Quality considerations

Environmental

considerations

Equal opportunities

considerations

Health and safety

considerations

Ability to deliver

2.7.5 Tender Procedure for Contracts of High Threshold Value

For contracts with a value above the thresholds for advertising in the OJEU the following process

should be followed to decide on the appropriate procedure:

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2.7.6 Tender Process:

Develop Award Criteria

Public entities may choose to

award contracts on the basis of:

The lowest priced tender;

or

The Most Economically

Advantageous Tender

(MEAT).

The most economically

advantageous tender is

selected using various criteria

linked to the subject matter of

the public contract in question.

Examples of criteria which can

be used in selecting a MEAT

tender subject to the full EU

rules include:

Quality.

Price.

Technical merit.

Functional characteristics.

Environmental

characteristics.

Running costs.

Cost effectiveness.

Standards / qualifications.

After sales service and

technical assistance.

Delivery period / period of

completion.

A fair and systematic weighting

or mark should then be

assigned to each criterion to

reflect its relative importance.

The OGP suite of documents

should be adhered to.

2.7.7 Guideline for Good Practice when Conducting Supplier Preparation

2.7.8 Develop and Issue

Request for Tenders

All documents issued by a

public authority should be

prepared in accordance with

the appropriate procurement

procedure. A template RFT for

use in the open procedure,

together with associated

documentation including the

contract and confidentiality

agreement and related

guidance is available at

www.procurement.ie.

The OGP is in the process of

preparing template tender

documentation for the creation

of frameworks. Queries in

relation to the suite of

template documentation may

be directed to the OGP.

2.7.9 Tips for Building

Effective Service Levels

The sole purpose of a

regime should be to align

the supplier’s objectives to

the client’s (i.e. to

incentivise the correct

behaviours).

It should not be intended

as punishment or as a

method of reducing the

charges.

The regime should be

aligned to the public

entities business priorities,

prioritising services

appropriately which in turn

should be set out in the

project’s specifications.

Task Description Good Practice Explanation

Define award criteria

and weightings/marks

The award criteria and

scoring weightings/marks

must be defined and

issued in the RFT.

Definition of the award criteria in the RFT is a legal

requirement and demonstrates greater objectivity in

evaluating the proposals and helps to ensure that the

tender is focused on asking the right questions to support

the evaluation.

Managing supplier

questions and answers

Share the questions and

answers of non-

commercially sensitive

questions with all

bidders.

It is key to create (as much as possible) an ‘apples-for-

apples’ comparison of the supplier’s tenders and therefore

questions which add clarity to the process and are not

commercially sensitive to the supplier should be shared

with all suppliers. The public authority may also issue

clarifications.

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Any credits should be

proportional to the level of

‘pain’ felt by the client. As

such, disproportionately

punitive credits (e.g.

hairline triggers) should be

avoided.

The regime should be

flexible and be able to

react to changes in

business priorities or

technological

improvements.

Simplicity should be

pursued at all times to

control the effort required

to manage the regime

operationally.

Scenario modeling of good,

average and bad

performance is the

recommended method for

testing a regime against

these key tips and to help

draw out any unintended

consequences.

2.8 Prepare Stakeholders for ESD Transition

The objectives of this activity

are to develop a plan to

accommodate staff affected by

the decision to move to an

external provider and to

develop a capability transfer

programme based on a high-

level capability strategy, to

transfer the key capabilities of

the internal organization to the

new supplier providing the

future service.

2.8.1 Transition Plan

Considerations

Industrial relations agreements

(the Public Service Agreement

2010 -2014, also known as the

Croke Park Agreement and the

subsequent Haddington Road

Agreement) provide that no

compulsory redundancies will

arise from any decision to

move to ESD for employees

who come under the

protection of these

agreements.

The engagement process with

staff representatives relating

to ESD projects set out in

current- industrial relations

agreements, particularly the

Appendix on Service Delivery

Options in the Croke Park

Agreement, must be followed

while the agreements are in

place.

Advice must be sought from

industrial relations specialists

in your organisation when

planning an ESD project.

Furthermore, as this is a

specialist area, external advice

should be considered.

2.8.2 Develop

Capability Transfer

Programme

The capability transfer

programme requires liaising

with key stakeholders to

identify the skills and

capabilities to be transferred

across to the supplier at the

point of transition and the

capabilities to be retained in-

house, which inform the

internal organisation design.

It is important to ensure that

there are clear lines of

communication with all

impacted parties and that a

comprehensive

communications and

engagement plan is developed

and implemented.

Current industrial relations

agreements provide that there

will be consultation with

affected staff and their

representatives during the ESD

project.

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2.9 Define Retained & ‘To-Be’ Organisational

Structures

This activity defines the

operating model requirements

for the internal (retained)

organisation and designs the

future structure of the

organisation that will manage

the service post transition. The

current as-is organisational

structure is used as the starting

point for this.

The guiding principles for

process demarcation between

the retained organisation and

the service provider should be

agreed in advance of the

procurement process as it will

determine the type of supplier

required and help distinguish

between service integrators,

managed services providers

and output-driven process

suppliers.

The detailed structure of the

retained organisation should be

included as part of the process

requirements in the RFT.

The structure of the retained

organisation should also be

informed by the desired service

management model. This is

driven by the number of

suppliers involved in delivering

the services (multi-sourced vs

single-sourced) and the level of

end-to-end service

management required to

manage the delivered services

which could also be part of the

supplier provided services if

required.

2.10 Outline Exit Provisions in Contract

To ensure provision is made in the ESD contract for relationship breakdown it is important for contracts to include information on exit provisions such as: What the outcomes are if

the value expected from the ESD relationship is not realised;

Reasons why the ESD arrangement potentially could be cut short from your organisations perspective and expectations on how to approach this scenario;

Reasons why the supplier might want to terminate the contract early and how this outcome will be managed;

How your organisation retains the right to terminate the contract early due to changing business requirements);

Is your organisation is required to give notice if you wish the contract to

expire and not be renewed;

Any changes in service provision or termination of the ESD contract due to a revised ESD strategy;

How the governance process may apply to termination of the ESD arrangement; and,

other methods of termination of the contract by either party which fall beyond the scope of this handbook;

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NRA Case Study – The Prepare Phase

Market assessment of

suppliers:

The NRA hired external

consultants to carry out a

Global Best Practice Study to

identify an initial list of

potential ESD suppliers,

determine the feasibility of

implementing a barrier-free

tolling system, identify best

practices and highlight any

potential risks and challenges in

the current market place.

The main challenge was to

launch the operation of a new

type (“first generation”) of

electronic road pricing on the

busiest motorway in the State

and successfully collect tolls

from up to 100,000 vehicles

from the first day of operations

and over 1,400,000 individual

vehicles within the first six

months.

Strengthening Legislation:

The NRA engaged with the

Department of Transport in

relation to strengthening the

legislation necessary for

barrier-free tolling. The

enactment of appropriate

supporting legislation which

allowed the use of video

evidence and action against a

toll evader / violator through

the use of the national vehicle

register was / is a critical

element to the operation to

address potential leakage of

toll revenue.

The Global Best Practice Study

commissioned by the NRA

during the assessment stages

highlighted that in all barrier-

free tolling regions specific

legislation was required to

enforce and penalise violators

and also to act as a deterrent.

Identifying Scoring and

Evaluation Criteria:

The NRA adhered to Public

Sector Procurement guidelines

throughout the supplier

evaluation selection process.

Price and quality were

identified as the key criteria in

supplier selection prior to

advertising the tender.

Contract Preparation:

The contract to design,

construct and supply the new

tolling system was awarded to

BetEire Flow (a French

consortium of two major

French firms - Sanef and CS) in

March 2007 following a

competitive procurement

competition.

The initial draft contract was

prepared between the Project

and Legal teams prior to

advertising the tender as per

Public Sector Procurement

guidelines. Service Level

Agreements were drafted as

part of the contract at this

point.

Contract Preparation

(Continued):

The contract specified a

number of important payment

based milestones for the initial

delivery of the system as

summarised below:

Milestone 1 - Approval of

Specification and

Implementation Plan.

Milestone 2 - Approval of

Testing Programme and

Operations Plan.

Milestone 3 - Completion

of Construction &

Performance Tests.

Milestone 4 - Trial

Operation Period.

Milestone 5 - Provisional

Operating Permit – “Go

Live”.

Milestone 6 - Final

Operating Permit.

The contract also required the

new Tolling Operator to

operate and maintain the new

system for a further 8 years.

In addition to the procurement

of the tolling system, there

were a number of other

supporting services which the

NRA procured to assist during

the mobilisation and

implementation phase of the

eFlow project including for

example, the appointment of

an Enforcement Service

Provider as well as the

appointment of technical

advisers with specific tolling

technology expertise and

electronic payment security

expertise, as well as legal

advisers and financial advisers.

There was little change made

to the terms and conditions of

the contract once the tender

had been advertised to the

market place.

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Supplier Management:

Once the NRA had agreed the

scope of the services to be

performed by the supplier and

had drafted the initial terms

and conditions of the contract,

the Expression of Interest (EOI)

was advertised on eTenders

and in the European Journal.

There was a procedure for the

suppliers to ask for clarification

on aspects of the tender which

benefited both the supplier and

the NRA as the supplier had the

ability to gain more clarity. In

addition, this procedure also

allowed the NRA to issue

clarification circulars with

additional information if

required including, for

example, clarifying certain

aspects of the scope which may

have been confusingly phrased.

Suppliers were asked to

provide evidence of their

experience, performance and

technical capability and to

demonstrate they had the

financial capacity to undertake

the work (e.g. to demonstrate

that they were financially

viable).

The evaluation team reviewed

the suppliers who responded to

the EOI and then prepared a

shortlist of suppliers based on

ranking the responses against

pre-determined criteria. The

NRA then issued the RFT to the

top five ranked suppliers.

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Exit

Points to Remember

Comply with EU

Procurement Law and the

public procurement

guidelines.

Use the OGP suite of

readymade tender

documentation and the

open procedure, unless

otherwise required by the

project.

Include any relevant

industry specific

regulatory requirements

within the RFT and ask the

supplier(s) to demonstrate

their experience with

meeting these for other

clients.

Engage early on with key

business stakeholders

within the public entity to

obtain buy-in and

establish clear business

critical success factors to

be met through the public

procurement process.

Consider the degree of

cultural fit between

supplier(s) and client as a

criterion in the supplier

selection process.

Successful procurement is

driven to a large extent by

effective planning and

preparation. Ensure that

the project team has the

required authority,

information and tools.

The logistical aspects of

the procurement process

can be complex. It is often

useful to have a dedicated

resource managing this.

End of Phase Checklist

Signed off RFT: The

documentation which will

in an open competition be

issued to the market or in

another form of

competition be distributed

to all participating

suppliers describing the

rules of engagement,

detailed requirements and

key timelines.

Supplier engagement

model: The process by

which to engage with

participating supplier in a

fair and consistent

manner, including

escalation procedures.

Governance model: Clear

definition of the end to

end model by which

delivery of the services

will be managed.

Available Tools

RFT and Contract Templates for Services

Enterprise Ireland Public Procurement Information

OGP Guidelines and EU Public Procurement Law

Risk Assessment Guidelines

Risk Assessment Tool (6)

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Evalu

ate

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Chapter 3

The Evaluate Phase

Evaluate Phase - Overview

The overall aim of the Evaluate

Phase is to identify the

successful tenderer(s) in

accordance with the published

RFT who will ultimately deliver

the ESD services. The actual

approach taken to completing

the Evaluate Phase will vary

depending on the procurement

procedure, scope, value and

complexity of the services

being procured.

However, irrespective of the

nature of the procurement

procedure used, in completing

this evaluation, the focus

should be on objective decision

making that result in the

selection of the supplier in

accordance with the RFT.

The Evaluate Phase will take

the public entity from having

issued an RFT to the selection

of a winning tender(s) and

contract signature. It is a key

step in the process as this is the

stage at which the client is able

to accurately assess the

supplier’s offerings and validate

the business case.

Managing the suppliers and

internal stakeholders

effectively are key

competencies that must be

focused on during the Evaluate

Phase, or the procurement

team risk losing control of the

process, open the possibility of

legal challenge or result in

lesser service being delivered.

Any dialogue with tenderers

that could be construed as

“post tender negotiation” on

price or result in significant

changes to the published

tender specifications must be

avoided.

It should be clearly understood

that all parties in the process

must be treated on the same

fair and objective basis.

Evaluate Phase - Key ESD Transition Principles

Create a ranked list of

suppliers aligned to the

selection criteria

Where price is the sole

criterion, the contract will be

awarded to the lowest priced

bid complying with the

specified requirements. Where

‘most economically

advantageous tender’ is the

basis, the contract must be

awarded to the tender which

best meets the relevant

criteria.

Make objective decisions

that are auditable

The selection must focus on

objective measures of the

supplier’s capabilities based on

criteria that comply with

procurement rules. Recording

and evidencing that the

decisions are underpinned by

an auditable trail of supporting

information will provide

confidence to the key internal

stakeholders that the right

decision has been made and

will provide evidence in the

event of a challenge or enquiry.

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Evaluate Phase - Roadmap

The Evaluate Phase roadmap defines the key tasks to be completed during the Evaluate Phase and the

outcomes to be achieved.

Sample Supplier Evaluation and Scoring Template

Property Asset Management Guidelines

EU Remedies Directive

Change Management Guidance

Workforce Planning Guidelines

ESD Model Guidance

3. Evaluate Phase Activities

Evaluate Phase Tools And Templates

3.1 - Confirm Structure Alignment

3.2 - Manage Supplier Interaction

3.3 - Develop Initial Plan for ESD Transition

3.4 - Evaluate Proposed Service Locations

3.5 - Manage Evaluation Activities

Evaluate Phase Stage Gate

Initial Evaluation of Proposals and Audit Trail Preferred Supplier Shortlist

Outcomes

Programme Management Office Activities

Mobilisation, Project Governance & Risk Management

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3.1 Confirm Structure Alignment

It is important to confirm at this

stage that the correct model

for External Service Delivery

has been chosen and that you

have a business model that

matches to the tender

specifications and is flexible to

accommodate any future needs.

You need to know what your

organisation will look like post

ESD and ensure that all aspects

are aligned. In terms of alignment

this means that you should try to

understand how your business

model could evolve in the future.

You should reflect on how

technology, competition, service

customers, service providers and

laws will or may change and what

possible impact this could have

on your current business model.

There are many different

techniques to evaluate possible

futures, such as scenario

planning, prediction markets,

systems dynamics and so on. All

you need to do is to map these

possible outcomes of an

uncertain future back to your

current business model in order

to be better prepared for the new

structure post transitioning.

Departments planning to start

an ESD initiative need to be

engaged and informed with

appropriate support and

funding in place to sustain the

continuous delivery of services

while any new supplier is

transitioning over. This should

be planned for at this stage.

3.2 Manage Supplier Interaction

3.2.1 Q&A Management

and Evaluation of

Tenders

The first task is managing the

question and answer process

(“clarifications”) during

preparation of the tenders by

the suppliers. The supplier’s

clarifications should be handled

through a single point of

contact within the client. The

contact may take the form of

email, or it may be through a

web portal, but in either case

all requests for clarification and

subsequent answers should be

logged. Supplier clarifications

should be shared with all

bidders in order not to

discriminate. Again, public

authorities should refer to the

OGP suits and guidance.

Following receipt of the

tenders, the public entity must

conduct an evaluation of the

tenders against the award

criteria as published in the RFT.

The size of the evaluation team

may vary depending on the

scope of the procurement and

the degree of subject matter

expertise required to complete

a review of the responses,

however more than one

individual should be involved in

reviewing each

section/component of the

proposal responses.

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3.2.2 Guideline for Good Practice when Conducting Supplier Evaluation

Task Description Good Practice Explanation

Selecting the

evaluation team

More than one evaluator

should score every section.

For large proposals

consider dividing the

evaluation up amongst

subject matter experts.

For smaller proposals a small number of evaluators scoring

the entire proposal may be appropriate. For large

proposals, dividing the evaluation up amongst the subject

matter expert community is likely to provide a more robust

evaluation of each section and ensure that the evaluation is

carried out by appropriately skilled individuals. Generally all

sections should be evaluated by more than one individual to

maintain objectivity.

Scoring tender

The scoring is done with

reference to an objective

scoring chart which

contains only the award

criteria that were set out

in the RFT with reasons

given for all scores.

To ensure the evaluation identifies the strengths and

deficiencies of the supplier’s proposals, the schema for

scoring the responses should identify the degree to which

the requirement is delivered by the supplier’s proposal and

the evaluation should capture the reasons for the score

given to provide an audit trail of the scoring which will feed

into the standstill letters which, depending upon the

procedure used, may need to be sent to the unsuccessful

tenderers.

Managing

communications

with the sponsor /

board

Maintaining regular

updates and briefings to

the sponsor / board during

the Evaluate Phase

activities.

The team should regularly brief the sponsor / board on all

activities during the Evaluate Phase to ensure that they are

fully informed of progress on the project. Failing to keep

the decision makers appropriately briefed risks losing

control of the process and creating a perception that an

ineffective or biased process has been followed during the

evaluation of the proposals.

Supplier

presentations

Allows suppliers to present

proposals (when

appropriate).

As an aid to understanding and clarity, it may be

appropriate to invite tenderers to present or elaborate on

proposals for technical or consultancy projects. However,

any dialogue with tenderers that could be construed as

"post tender negotiation" on price or result in significant

changes to the published tender specifications must be

avoided.

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3.2.3 Evaluate Tenders (RFT) Responses

Depending on the tendering procedure selected in the Prepare Phase the following steps should be

conducted in the Evaluate Phase to ensure a fair, transparent, equal and competitive process.

Source: Public Procurement Guidelines – Competitive Process

3.3 Develop Initial Plan for ESD Implementation

3.3.1 Impact Analysis

Following the identification of

the successful tenderer, it

should now be possible to

complete an impact analysis on

the organisation and

commence planning for the

changes that will result from

implementation. Workforce

planning guidelines and

framework should be consulted

at this stage.

The impact analysis should

consider any personnel

changes, but also the impact on

the client’s processes and ways

of doing business and consider

the most effective way of

managing change within the

client’s organisation.

A key aspect to change

management is effective

communications of the impact

of the changes on the client’s

team. Staff that may be

affected by the project are

typically keen to gain certainty

on how the change will affect

them and uncertainty will likely

cause increasing

disengagement from the

process. It may also be

appropriate to begin

consultation with staff

representatives during this

phase to discuss the potential

scope of changes though these

may be preliminary or

provisional discussions at this

stage. In a public service

context the key provisions of

current industrial relations

agreements must be

considered where relevant.

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Exit

3.3.2 Initial Plan

An initial change management

plan should be written at this

stage. This is so you can

intentionally design the process

that helps all stakeholders

know what needs to change,

why it needs to change, and

how to go about making the

change take place smoothly.

In preparation to write this plan

you should have determined

exactly what needs to change;

have brainstormed potential

solutions and made the

decision on how to move

forward. Once you start writing

the plan you should outline

your action steps such as

identifying resources and

setting appropriate budgets

etc. A timeframe should also be

set determining the pace of

change with some extensive

reflection on how these

changes will affect different

staff in terms of their

schedules, workloads and

resources. This is a good time

to identify potential obstacles

that could get in the way of the

change being implemented

effectively and where possible

try to list ways that these issues

may be circumvented. Finally

change can be difficult to deal

with both on an organisational

and personal level. Building

trust and loyalty and

communicating effectively to

reassure all concerned will help

gain support. Guidance and

further information on Change

Management is available by

following this link.

3.4 Evaluate Proposed Service Locations

Approving a business location

that a supplier intends using to

provide the ESD is very

important and requires

planning and research. It

involves looking at the area,

assessing the match to the

service requirements and to

the structure, ensuring there

are adequate resources for

future growth, ensuring

compliance with current

regulations (health and safety

laws; planning laws etc.) and

property asset management

guidelines. This is not an

exhaustive list and expert

guidance should be sought

prior to making a decision on a

business location.

3.5 Manage Evaluation Activities

3.5.1 Monitoring &

Managing

The success or otherwise of the

activities during the Evaluate

Phase is highly dependent on

the rigour that is placed around

the project/programme

management framework that

supports the process.

Whilst the details of the

process may vary the

requirements for effective

management of interactions

with the suppliers remains

consistent, ensuring objectivity

within the evaluation teams,

structuring tender evaluations

effectively and managing the

senior stakeholders within the

client’s organisation.

Throughout the Evaluate Phase,

the identification, reporting

and management of risks and

issues is key to delivering an

effectively managed and co-

ordinated procurement. For

large initiatives the Program

Management Office should

take a formalised approach to

this, but for smaller initiatives,

a regular informal review may

be sufficient to manage these

risks.

The evaluation of the tenders

should be co-ordinated by the

project management team who

should take the lead in the

following activities:

Communication of the

evaluation plan and

framework to the

evaluation team.

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Receipt and distribution of

the tenders to the team

(note that as all members

of the team may not be

evaluating a section, only

relevant sections should be

sent to reviewers).

Co-ordinating the

evaluation responses and

any consensus meetings.

Reporting the results of

evaluation to the

leadership team.

The final task that the project

team often perform in this

phase is to inform the winning

tenderer and rejected suppliers

and offer to debrief the losing

suppliers on the reasons for not

being selected. In cases where

the procurement is above the

EU thresholds the Remedies

Directive needs to be followed.

3.5.2 PMO

Considerations

Scoping the Project

Management Effort

Although the core

requirements for project

management are equally

important on all ESD initiatives,

the structure and size of the

project team will normally vary

to take into account the

complexity and importance of

what is being procured.

Managing small

procurement projects

For smaller scope

procurements, the

management challenge is

typically reduced due to the

scale of the teams and scope of

the service being smaller and

the project management may

not be a dedicated role.

However this does not reduce

the importance of effective

project management. Indeed in

many cases the smaller team

size may introduce challenges

around ensuring that

objectivity and audit trails are

maintained with a small team

of stakeholders.

Managing large

procurement projects

With a large scale procurement

programme, the challenges are

often much more complex and

a dedicated

project/programme manager

and supporting Project

Management Office (PMO)

function are often required to

co-ordinate activities between

different work streams and to

manage communications and

formal reporting. A clear focus

on the objectives and managing

scope changes is critical in

successfully delivering these

large programmes.

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Exit

NRA Case Study – The Evaluate Phase

Supplier Management:

In the Prepare Phase the

evaluation team reviewed

the suppliers who responded

to the EOI and developed a

shortlist of suppliers to

receive the RFT.

The NRA managed suppliers

through the proposal

process. There was a facility

for suppliers to ask questions

and suppliers could also

indicate whether they

considered that some of

their questions were

commercially confidential.

The NRA reviewed all these

questions and responded to

all suppliers. Where a

supplier had requested for a

question to be considered as

commercially confidential

the NRA team had to take a

view and possibly respond

directly to the individual

supplier. Where the NRA

determined that the query

was not commercially

confidential the supplier was

given the opportunity to

withdraw the query rather

than have it answered and

issued to all suppliers.

Generally the NRA team

would issue responses to

queries on a weekly basis.

Evaluation of Supplier

Responses:

As part of the Expression of

Interest (discussed in the

Prepare section of the

handbook) the NRA prepared

a short-list of suppliers – all

of whom had to satisfy

minimum requirements in

terms of having the

necessary technical capacity

(e.g. experience) and

financial capacity to perform

the services required. For

the evaluation of the RFT,

the NRA established an

evaluation methodology to

assess the responses based

on a combination of scoring

the responses for both price

and quality.

Once the responses were

returned to the NRA the

evaluation team reviewed

the applications and scored

them against these

predetermined criteria (and

any sub-criteria). Careful

consideration was taken to

ensure that submissions

were scored and evaluated

based on the written

application and evidence /

commitment provided as

part of the response rather

than being influenced by

general market knowledge.

The NRA followed set

procedures in managing the

supplier applications e.g. in

terms of late applications or

if a supplier declined the

project. All evaluation and

selection criteria were

carefully documented for

audit purposes and all

procurement documentation

was checked by the NRA

legal advisers in advance of

the procurement

competition to ensure it was

fully compliant with

procurement law.

External consultants were

asked to provide assistance

and opinions in the

evaluation and selection

process however the NRA

had final judgement in the

evaluation process.

Supplier Selection:

The contract to design,

construct and supply the new

tolling system was awarded

to BetEire Flow (a French

consortium of two major

French firms - Sanef and CS)

in March 2007 following a

competitive procurement

competition.

3-9

Exit

Points to Remember

There are two key

activities performed

during the Evaluate Phase:

Managing supplier

clarifications.

Identifying the

successful tenderer at

the head of a ranked

list of tenderers.

The output of the Evaluate

Phase is a ranked list of

tenders.

During supplier

clarifications, clarifications

should be shared with all

the bidders.

Evaluation of the

supplier’s tenders must be

performed using an

evaluation framework

determined before

advertising the RFT and be

comprised solely of the

award criteria that have

already been published to

the market.

Sections of the tenders

should be evaluated by a

minimum of two

reviewers. The evaluation

scores and supporting

rationale should be

captured for audit

purposes.

End of Phase Checklist

Approved ranked list of

supplier(s): Following

completion of the

Evaluate Phase, a ranked

list of tenders for final

internal presentation to

the sponsor/board.

Evaluation audit trail: The

evaluation and scoring and

any subsequent updates

to the valuation should be

collated in a single

location to provide a

record of the evaluation

and support any audit

activities required.

Available Tools

Sample Supplier Evaluation and Scoring Template (7)

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Co

mm

it

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Chapter 4

The Commit Phase

Commit Phase - Overview

The primary objective of this

phase is to get the project

‘across the line’. Many of the

activities initiated in the

previous phases are completed

during the Commit Phase,

culminating in the signing of

the ESD agreement.

While the project team is

focusing on securing the best

value, significant internal effort

is required to manage

stakeholders and achieve the

executive buy-in necessary for

contract signature. The public

entity will enter into a contract

with the successful tenderer(s)

as identified at the end of the

Evaluate Phase.

In parallel to these activities, a

series of critical internal

activities are taking place:

The design of the retained

organisation needs to be

finalised and the plan for

the transition of staff

developed (if applicable)

with any necessary

consultations taking place.

Security and control also

need to be taken into

account.

Commit Phase - Key ESD Transition Principles

One Team

Effective communication

between the project teams

from the outset has a

significant impact on the

timelines, effort and overall

success of the project. This

includes involvement of the

legal team from the early

stages of the process, constant

alignment of the commercial,

legal and financial services

aspects of the negotiations and

open communication channels

between the supporting

teams.

Focus on the ESD

objective

The most common reasons

why ESD agreements struggle

operationally are related to

transition, transformation and

service delivery. As such, the

focus of the team should be

aligned to these areas

alongside the overall

objectives of making financial

savings and improving service

provision.

Be well informed and

realistic

Unreasonable requirements,

often originating from lack of

information or expertise, will

take focus from what is truly

important and prolong the

process. Well informed and

realistic requirements can be

defended much more

effectively.

Consider future change

Often ESD agreements become

out of date before they expire,

ceasing to meet business

requirements in the new

market conditions. All aspects

of the contract should be

considered with potential

future change in mind, from

the definition of pricing units

to the flexibility of service

levels.

4-2

Exit

Commit Phase - Roadmap

The Commit Phase roadmap defines the key tasks to be completed during the Commit Phase and the

outcomes to be achieved.

NPS Suite of Guidelines Project Initiation Document (PID) Tool

4. Commit Phase Activities

Commit Phase Tools And Templates

4.1 - Reassess Value Proposition

4.2 - Select Supplier & Sign Contract

4.3 - Clarify Contract Details with Successful supplier

4.4 - Manage Stakeholders: Executive Buy-in & Approval to Sign-off

4.5 - Finalise Retained Org. Structure

4.6 - Manage Security & Control

4.7 - Manage Communications & Align Work Streams

Commit Phase Stage Gate

Signed ESD Agreement

Retained Org. Structure

Value Delivery Roadmap

Transition Plan

Outcomes

Programme Management Office Activities

Mobilisation, Project Governance & Risk Management

4-3

Exit

4

4.1 Reassess Value Proposition

4.1.1 Check Tender

against Business Case

This involves assessing what

has been outlined in the

tender for the ESD initiative

including costs, risks and issues

versus what was outlined in

the Business Case. In addition

the ESD lead should regularly

monitor if the business case

continues to be viable in terms

of alignment with ESD strategic

objectives. This monitoring

could take the form of the

production of documentation

and reports to be used at key

stages. Reporting provides the

ESD initiative lead with a

summary of the status of the

ESD initiative at intervals

defined by them versus the

original business case.

Controls usually relate to key

milestones of the ESD initiative

and help to control the

delivery of the initiative

outputs. These controls can

take two forms - event driven

and time driven. Event driven

control means that the control

occurs because a specific event

has taken place. Examples of

event driven controls include

End-Stage Reports, completion

of a Project Initiation

Document (PID) and creation

of an exception plan.

Time driven controls are

regular progress feedbacks.

Examples of time driven

controls include checkpoint

and highlight reporting.

Depending on what the ESD

service is, either or both

controls mechanisms should

be used at this point and at

regular intervals throughout

the ESD lifecycle.

4.1.2 Value Profile and

Delivery

The business case should be

used to understand the overall

impact of the solution. The

business case represents the

value that the ESD initiative

will bring to the public entity

over the duration of the

contract. Typically the value

profile will vary throughout the

term and will be dependent on

supplier and public entity

actions as well as external

influences.

A value delivery roadmap will

document how and when

value will be delivered and

demonstrate how the total

value of the business case will

be achieved. It should be used

to guide operations and ensure

that the value is extracted.

Lack of focus on value delivery

or poor contract management

can result in projects not

delivering the benefits that the

parties envisaged at the time

of contract signature.

4-4

Exit

4.2 Select Supplier & Sign Contract

Upon completion of the

evaluation of the RFT

documents there will be a

successful supplier who will be

awarded the contract.

Remember to ensure the

contract records all terms and

conditions required as per the

OGP suite of guidelines. The

successful supplier will then be

required to sign a contract.

Depending on the tendering

procedure selected in the

Prepare Phase the following

steps should be conducted in

the Commit Phase to ensure a

fair, transparent, equal and

competitive process.

Source: Public Procurement Guidelines – Competitive Process

4.3 Clarify Contract Details with Successful

Supplier

Following the contract being

signed by both parties it may

prove useful to arrange a

meeting to discuss the actual

roll out of the process. The

supplier will have questions on

how the new arrangement will

differ in everyday life to the

previous service provision. This

meeting is also where you can

arrange the finer details such

as custom and practice in your

organisation regarding leaving

and entering the site if

relevant and the general way

things operate in your

offices/business premises.

Often it is at this stage that you

really get to know your new

business partner and start to

build the working relationship

that is so important to

successful ESD initiatives.

4-5

Exit

4.4 Manage Stakeholders: Executive Buy-In &

Approval to Sign-off

In order to achieve this buy-in

the project team should be

managing its stakeholders

throughout the course of the

Commit Phase.

This includes regular updates,

review sessions, evaluation

outcome presentations and

decision making workshops.

The objective of this activity is

to ensure that the key

stakeholders are fully informed

throughout the process, that

the project receives timely

guidance and that approval to

sign is granted. Depending on

the organisational

circumstances, this activity can

be significant and can require a

dedicated team.

4.5 Finalise Retained Organisation Structure

The design of the retained

organisation should be

finalised during the Commit

Phase. It should reflect any

changes to the solutions and

overall project that transpire

during the negotiations and

should include the timeline for

implementing the design. In

many cases elements of the

retained organisation should

be in place shortly after

contract signature and as such

it is common for members of

the retained organisation to be

part of the project team.

Once the design is finalised,

communications to any in-

scope and out-of-scope staff

should be managed and any

engagements with staff

representatives completed.

Note that Industrial Relations

Agreements including the

Croke Park Agreement and the

subsequent Haddington Road

Agreement and other

initiatives may place

limitations on the ability of any

ESD initiative to be completed

without a period of

consultation being completed

so this may well be on the

critical path to contract

signature. It is important that

these activities are identified

early during the process in

order for the client to manage

any impacts.

Diagram: Typical Retained Organisational Structure

4-6

Exit

4.5.1 Develop ‘People

Transition Plan’

As outlined on page 2-13 (2.8)

the engagement process with

staff representatives relating

to ESD projects set out in

legislation (TUPE) and current-

industrial relations

agreements, particularly the

Appendix on Service Delivery

Options in the Croke Park

Agreement, must be followed

while the agreements are in

place. Advice must be sought

from industrial relations

specialists in your organisation

when planning an ESD project.

Furthermore, as this is a

specialist area, external advice

should be considered.

To develop a ‘People

Transition Plan’ it is key to first

list the members of the

transition team, providing the

name of the person who fulfils

each roll. Next a list of

transition tasks should be

devised and the each member

of the team is assigned/or

chooses tasks until all the tasks

have been allocated. Time

frames should be assigned to

each task with weekly review

meetings to monitor progress.

The types of tasks included in a

people transition plan include

reviewing what needs to be

delivered to generate a

requirement list; create a list

of required skills and identify

the skills gap; identify projects

that can be completed before

the transition starts; establish

transition milestones and plan

to fill skills gap; devise a

monitoring plan for the key

milestones and plan for the

eventual handover and

ultimate exit from the process.

Departments should ensure all

those involved understand

what will happen to them after

transition such as remaining in

current position; possibly

moving to a new supplier or

redeployment. This assurance

helps maintain morale and

enthusiasm for the ESD

project.

4.6 Manage Security & Control

4.6.1 Balance the Risk

and Solution for

Security and Controls

The outcome is likely to

involve some degree of

transfer of security and/or

controls between the public

entity and the supplier or

between the incumbent

supplier and their

replacement. Obviously this

transfer can create a risk of

loss of control or reductions in

the effectiveness of the

security measures (either

permanently or temporarily).

In addition, the location and

storage of data (including

personal data) may need to

meet regulatory or legal

requirements and this must be

fully understood prior to the

completion of any initiative.

Therefore ensuring a clear

commitment that the

supplier’s solution for security,

control and data management

meets the necessary

requirements is key to de-

risking the project. In addition,

a clear understanding of the

transition plan relating to

these security aspects is

equally important. The scope

of this activity can cover

controls across personnel,

policies, standards, physical

security and technical security.

4.6.2 Manage

Confidentiality

The public entity should

manage security and

confidentiality issues and

utilise the mechanisms in the

confidentiality agreement

which forms part of the OGP

suite of tender documentation.

4-7

Exit

4.7 Manage Communications and Align

Workstreams

Given the complexity of many

ESD projects and the criticality

of open communication,

effective project management

is pivotal to a successful

outcome. This is especially true

in the Commit Phase where

disparate teams (such as the

stakeholder management

team) all work to aggressive

timelines. In order to have a

successful client/supplier

relationship, it is important

that the public entity and the

new supplier spend enough

time getting to know each

other. This may involve

explaining any relevant

processes clearly and ensuring

there is clarity of

understanding between both

parties. If roles and

responsibilities are not clearly

defined, this may be a problem

for the ESD relationship. Work

outputs can be aligned by

establishing clear KPI’s and

priorities early in the process.

It is also important to review

actual results against those

forecasted on a regular basis.

Relationship problems can

arise in circumstances where

suppliers exploit an

organisation’s weaknesses;

where scope creep is allowed

to foster and where there are

poor communications between

both parties. It is essential that

the contract is managed

effectively.

In addition to standard project

management tasks such as

budgeting and planning, the

project management office

often has the critical role of

facilitating communication and

aligning the work streams.

This can include ensuring that

questions are resolved through

the stakeholder management

process and that commercially

significant due diligence

findings are adequately

reflected.

4-8

Exit

NRA Case Study – The Commit Phase

Supplier Selection:

The contract to design,

construct and supply the new

tolling system was awarded to

BetEire Flow (a French

consortium of two major

French firms - Sanef and CS) in

March 2007 following a

competitive procurement

competition.

Signing the Contract:

In line with Public Sector

Procurement Guidelines, there

was no scope for renegotiating

contract terms and conditions

at this point as the terms and

conditions of the contract

were developed prior to

advertising the Tender. The

first supplier selected decided

against proceeding with the

contract as they wished to

renegotiate certain contract

terms and conditions at this

point and this was not

allowable. BetEire Flow’s

tender proposal was evaluated

as the second best proposal

and they were therefore

awarded the contract.

Supplier Role and

Responsibilities:

BetEire Flow (Sanef) was

required to manage and

operate all aspects of the

tolling business on behalf of

the NRA, including to:

Manage their customer

base and provide excellent

services to their customer

base (circa two million

people).

Collect revenues and

account for over €100

million tolling revenue.

Manage their assets

including the eFlow brand

and reputation (includes

marketing and

communications).

Be commercially focused

and to deliver continuous

improvement for the

customers and the

financial position (e.g.

costs efficiencies).

Be compliant and

auditable – areas such as

financial audits, e-

commerce PCI compliance

and Data Protection.

Focus on strategic goals –

be aligned to the Irish and

European tolling sectors.

The NRA’s Role and

Responsibilities:

The NRA need to

understand the business,

set the vision and

objectives, direct the

business, monitor

performance and manage

the relationships (and

contracts);

Contract Management of

the following four areas:

Efficiency Savings - annual

service review.

Gain Sharing - consider

making provision to share

gains.

Financial Model / Open

Book Accounting.

Benchmarking - service

performance and costs.

4-9

Exit

End of Phase Checklist

Signed contract: The core

outcome of the Commit

Phase is the signed

contract with the

successful tenderer.

Signed-off people

transition plan: The people

transition plan should be

aligned with the

agreement’s transition

plan and comply with

applicable legal

requirements.

Signed-off retained

organisation design: The

retained organisation will

often need to be

established immediately

after (or even before)

contract signature.

Signed-off value delivery

roadmap: The roadmap

will be used throughout

the life of the contract to

monitor progress against

the delivery of anticipated

value and support the

initiation of any necessary

corrective action.

Completed consultations:

In many cases

consultations with unions

and/or works councils

must be completed.

4-10

Exit

Tra

nsitio

n

5-1

Exit

Chapter 5

The Transition Phase

Transition Phase - Overview

The objective of this phase is

to transition the work and

resources (infrastructure and

responsibility) to the selected

supplier(s). This is the phase

where the ‘rubber hits the

road’. The value realisation of

the programme is initiated and

emphasis is put on process

implementation,

project/programme

management and knowledge

transfer. Teething problems

are expected to be resolved

during this phase. The program

should have a strong,

streamlined escalation

mechanism to resolve

problems quickly and keep the

ball rolling. Another key

prerequisite is stakeholders’

commitment to the program.

This phase includes a number

of key tasks around the

transition covering:

Implementing a robust

transition plan in

collaboration with the

supplier.

Plan and implement an

appropriate retained

organisation.

Developing and

implementing standard

operating procedures that

clearly identify the

operating model,

governance framework,

service levels, decision

rights matrix, and roles

and responsibilities.

Open communications and

change management to

ensure that the

organisation understands

the plan and the impact

upon them.

Implementing the

measurement and

reporting mechanism to

track value consistently to

understand variations

from the business case

and provide the ability to

take necessary action.

Overall project/

programme management

that ensures stakeholder

and organisation wide

commitment, risk

management, and status

reporting is in place.

5-2

Exit

Transition Phase – Roadmap

The Transition Phase roadmap defines the key tasks to be completed during the Transition Phase and

the outcomes to be achieved.

Value Delivery Roadmap

Transition Roadmap and Plan

Transition Performance Report Template

5. Transition Phase Activities

Transition Phase Tools And Templates

5.1 - Monitor Value Proposition

5.2 - Develop Transition Plan

5.3 - Develop & Manage Process Guide

5.4 - Monitor Supplier Transition

5.5 - Manage Workforce Considerations

5.6 - Shift Responsibilities to Supplier Organisations

5.7 - Manage the Transition

Transition Phase Stage Gate

Implemented Transition Plan

Retained Organisation Structure

Active Relationship with Supplier with on-going monitoring and reporting

Outcomes

Programme Management Office Activities

Mobilisation, Project Governance & Risk Management

5-3

Exit

5.1 Monitor Value Proposition

5.1.1 Implement Value

Delivery Model

A value delivery roadmap will

be developed and will

document how and when

value will be delivered and

demonstrate how the total

value of the business case will

be achieved. This plan will

clearly identify the initial

investments required and the

value that will be delivered

over the term of the contract.

Based on the contract with the

supplier(s) the value model will

be updated to include year-on-

year improvements agreed to

by the supplier.

Implementation of the value

delivery model requires:

Approval of the value

roadmap by senior

management, supplier

management team and

finance.

Creating a reporting

mechanism to measure

and track the value being

generated.

Identifying roles and

responsibilities of the

various teams going

forward.

Measure and track value

5.1.2 Measure and

Track Value

Once the value delivery model

is implemented, key

performance measures

identified in the model need to

be tracked and reported in a

consistent manner. During the

Transition Phase issues and

exceptions are expected in this

process and it is important to

resolve them quickly to

stabilise the data gathering,

reporting and exception

handling process. At the end of

the Transition Phase, it is

expected that the process of

measuring, reporting and

tracking of value is stabilised.

A Value Delivery Roadmap

template (8) is available at

http://esd.per.gov.ie/guidance

-and-resources/

5.2 Develop Transition Plan

The leadership teams on public

service organisation and

supplier side jointly develop

the transition plan to provide a

guide through the different

steps involved in the

transition.

The plan (3) will typically

identify the following steps:

Pre-transition activities

such as ensuring all IT, HR,

and logistics issues are

resolved.

Knowledge transfer

activities such as

conducting meetings with

all subject matter experts

to understand the

operational details of

delivering in-scope

services to the business.

Ramping up and training

activities.

Stabilisation activities of

running test scenarios.

Parallel run (optional

depending on

circumstances) to ensure

that transition is complete

and successful.

5.2.1 Contract

Management

The contract, approved and

signed in the commit phase

now enters the operational

phase. Contract management

is transitioned to the Supplier

Management Office (SMO) for

operational management with

a steering committee

consisting of business

leadership formed to oversee

the SMO activities. SMO is

responsible for on-going

monitoring and reporting of

risks/issues and status and

governance reports on a

regular basis to the steering

committee. Transition

Roadmap and Transition

Performance Report templates

(3 & 9) are available at

http://esd.per.gov.ie/guidance

-and-resources/

5-4

Exit

5.3 Develop and Manage Process Guide

If possible it is preferable to

have a ‘step by step’ process

guide. This process should

include key steps such as:

Creating the list of

reporting documents

required;

Writing these documents;

Streamlining these forms

to match the tender

keeping them as short and

simple as possible;

Getting sign off on the

frequency required;

Generating systems to

speed up the process such

as esignatures etc.;

Ensuring there is a process

checking that there is no

value leakage;

Co-ordinating all

documents in one place;

Using templates for

reports allowing for easy

audit and reporting, and

renewal.

Step by step contract

management should allow you

to have complete visibility and

control over any given process

from its inception to its

renewal. For each step in the

process guide management

procedure, pre-set planned

step by step suggestions

prevent clogs and speed up

information generation.

5.4 Monitor Supplier Transition

This step begins once the

transition of contract

management to the Supplier

Management Office (SMO) has

started and continues

throughout the Transition

Phase. SMO monitors the

knowledge transfer processes,

documentation during the

knowledge transfer, training

and shadowing sessions. The

supplier reports the transition

performance through regular

transition performance reports

to the SMO.

SMO monitors supplier staffing

plans and implementation to

ensure the level and

experience of the resources

being staffed are as agreed.

SMO will also monitor that

staffing ramp up is able to

meet the service delivery

goals. SMO will continue to

monitor the supplier staffing

throughout the service

delivery.

Additionally the SMO provides

an escalation mechanism for

dispute resolution. The issue of

resolution governance will

typically span from the project

managers, on both public

sector organisation and

supplier side, to the steering

committee.

The areas of supplier

management are defined

during this stage and can

consist of various departments

including demand

management, service

management and supply

management. Each of these

departments work with the

supplier in their respective

areas to ensure the service

delivery is smooth.

For example, in a typical

service delivery organisation

these departments would

perform the following roles:

Demand management

controls all interactions

with the public sector

organisation, and has

responsibility for

requirement analysis,

budget approvals and user

acceptance.

Service management

manages day-to-day

supplier interactions for

both steady state

operations and projects

and is accountable for

service delivery.

Supply management leads

sourcing and procurement

in line with procurement

rules, manages

contractual disputes,

interfaces with legal

advisors.

5-5

Exit

The SMO manages

supplier relationships,

provides supplier

governance, tracks

supplier financials,

manages supplier

performance and

adherence to agreed

service levels and

facilitates resolution of

supplier related issues.

5.5 Manage Workforce Considerations

5.5.1 Support

Leadership renewal

In this phase the interaction

between the public sector

organisations operational team

and the suppliers’ team is

initialised. This interaction will

be the basis of a long-term

successful partnership. It is

important that leadership from

the public sector organisation

and suppliers are clearly

identified to create a strong

framework of collaboration.

The supplier typically tends to

deploy transition experts to

manage this phase and then

replace them with operational

leads at the end of transition.

5.5.2 Transition

Planning Workshops

Transition of knowledge to

supplier teams is very

important to the project’s

success. It is important to plan

for the transition process to

ensure the transfer of

knowledge is exhaustive. The

transition plan is created

jointly between the public

sector organisation and the

supplier leads and the

workshops provide a

collaborative mechanism to

discuss specific needs and risks

that need to be mitigated.

As part of this transformation

of the organisation, the leaders

of the public sector

organisation need to

effectively communicate the

change to the rest of the

organisation. Along with

regular communication and

change management, it is also

important to conduct

leadership coaching sessions to

educate the key business

stakeholders about the new

structure, dynamics of supplier

management, governance of

the new model and provide

tips on extracting the

maximum benefit of the

model.

Diagram: Process Flow for Identifying Operating Leads

Transition of knowledge and work is very important to the project’s success

5-6

Exit

5.6 Shift Responsibilities to Supplier Organisations

It is expected that a large

portion of the responsibilities

will be shifted to the supplier’s

organisation. The public sector

organisation will reduce to a

smaller team who are

responsible for management,

leadership and governance. In

order to accommodate the

new set of responsibilities in

the public service organisation,

a revised team structure will

need to be implemented. This

new structure will include

public service organisation

team members in critical

leadership and management

roles and could include

supplier personnel in more

operational roles.

It is important to structure the

team so as to facilitate

collaboration and innovation,

whilst ensuring commitment to

performance measures. The

assignment and staffing of the

retained organisation is key to

the success of any ESD

initiative. Key skill sets

required in the public sector

organisation will be

management of remote teams,

detailed service knowledge,

service management and

process optimisation.

5.7 Manage the Transition

Depending on the size and

complexity of the ESD

initiative, managing the

transition can be extremely

challenging. In addition to

standard project management

tasks, the project management

office (PMO) has the critical

role of facilitating

communication and aligning

the work streams. A dedicated

team is required to manage

multiple suppliers, multiple

public sector organisation

teams, public sector

organisation leadership,

stakeholders and functional

leads so that they work in a

cohesive and collaborative

way.

Transition Life Cycle Potential Pitfalls Lessons Learned

Transition and Implementation

High staff turn-over rates leading to loss of continuity, experience and knowledge.

Supplier staff are poorly trained and of insufficient quality.

Little control over supplier human resources management processes and approach.

Poor communication mechanisms between elements hamper successful delivery.

1. Create and monitor Supplier Management Offices and functions with key stakeholders using a

transition performance report template (9).

Supplier Management

Poor governance structure for managing ESD relationships.

Poor management of the on-going relationship with key Service Provider(s) to ensure satisfaction after, for example the loss of major bid.

Service levels not measurable, do not provide means for action, and are not monitored on an on-going basis.

2. Manage and document knowledge transfer as transition continues using a

transition performance report template (9).

5-7

Exit

Intellectual property issues and loss of institutional knowledge.

Loss of flexibility to react to changes in the market (e.g. competitive, regulatory) as a result of being locked into multi-year deals.

3. Regular review of compliance with service level.

5-8

Exit

NRA Case Study – The Transition Phase

Once the contract had been

signed, Sanef began to design

and build the new electronic

tolling system. This system,

eFlow, was ‘switched on’

during August 2008. Following

the launch of the system,

Sanef were responsible for

managing and operating all

aspects of the tolling business

on behalf of the NRA.

While the project was on time

and delivered to budget there

were nevertheless a myriad of

technical and operational

issues to be addressed during

the Mobilisation Phase (just

after ‘go-live’) which resulted

in significant levels of

customer frustration, a large

backlog of customer contact to

manage and widespread

negative media attention.

About two months after the

launch, the NRA recognised

that the operation was simply

not performing adequately

across a number of critical

areas of the business (e.g.

customer management and

collections) and as a

consequence the delivery team

had to take a step back and

reconsider the objectives and

approach to the new business

and in order to determine and

implement a revised strategy

to stabilise the business and to

create the right platform from

which it would develop and

improve going forward.

One of the first things the

team did following this, and

perhaps one of the most

critical, was to work out a

simple mission statement for

the business, which was as

follows:

To procure and oversee a world

class barrier-free tolling

operation on the M50

Motorway which is

commercially focussed,

financially efficient and results

in a positive experience for all

customers using the

Motorway.

Supplier Management:

Effective supplier management

was critical at this point of the

project. The NRA identified

issues and areas for

improvement and worked

closely with Sanef to

implement and achieve these

improvement items. As this

was a first generation project

there were a number of key

learnings for both partners in

the Transition Phase such as:

Approaching the project

with consideration for

customer needs and

business financial needs as

well as from an

engineering and technical

perspective;

Ensuring Sanef understood

the NRA’s strategy and

requirements so they

could deliver against it.

Sharing project and

business goals with Sanef

and regularly reviewing

these with Sanef so Sanef

could remain agile in

responding to them.

Ensuring the supplier has

the necessary resources

and capabilities to deliver

the project and ensure

these remain in line with

changing project and

business goals.

Keeping communication

lines open and the

importance of team

building between both

partners.

Balancing the level of risk

between Sanef and the

NRA.

The importance of Brand

Management

5-9

Exit

End of Phase Checklist

Service Transitioned: All

services and processes

transitioned to the

supplier.

Retained Organisation

Established: Key personnel

in place on public sector

organisation side to

manage the contract.

Value Delivery Approach

Established: A mechanism

is in place to monitor and

report on the on-going

value of the ESD initiative.

Available Tools

Value Delivery Roadmap (8)

Transition Roadmap and Plan (3)

Transition Performance Reports (9

5-10

Exit

5-11

Exit

Op

timis

e

6-1

Exit

Chapter 6

The Optimise Phase

Optimise Phase - Overview

The Optimise Phase focuses on

those activities which ensure

the ESD arrangement is

managed and continuously

improved beyond the

Transition Phase. The focus is

not only on management of

the supplier but also includes

looking inward into the public

sector organisation to ensure

that contractual obligations

are fulfilled in a timely and

effective way, and that service

demand is properly managed

and satisfied. The phase also

includes the preparation for

the procurement process in

advance of the ESD contract

expiring.

Following the transition of

services, it is important to

focus on the conditions under

which the arrangement can

flourish and services and costs

can be optimised. Realisation

of a projected ESD business

case requires sustained

commitment and effort to

manage the supplier,

rigorously track and manage

projected benefits, and build

strong internal understanding

of the service scope, pricing

and obligations.

Key activities to support this

include:

Developing an agreed

governance model and

conditions for a strong,

mutually rewarding

relationship.

Internally agreeing a

function to manage

business demand and

supplier supply.

Providing the focus and

resource for dedicated

sustained ‘benefits

realisation’ activities such

as tracking and measuring

of performance indicators.

Building an experienced

commercially-focused

team to contract manage

public sector organisation

and supplier rights and

obligations.

Investing time, effort and

sponsorship in innovation

management to ensure

improvement and

transformation objectives

are pursued after

execution.

Public sector organisations

need to plan and prepare for

the next steps, ranging from

tactical remediation to a full

re-tender process at the end of

the term. During the Optimise

Phase, it is important to keep a

focus on the demand for

services from the business.

Robust demand management

is also required to manage the

quantity utilised.

This is done through the

retained organisation using

such processes and levers as:

Linking resource use to

resource cost in order to

that the business has a

clear view of the

implications of their

decisions.

Managing business

expectations.

The Project Manager

challenging the process

during the receipt of

quotations from the

supplier as part of service

request management.

6-2

Exit

Optimise Phase - Key ESD Transition Principles

Benefits Realisation

Continue to measure benefits

realisation against the original

business case.

Continuous Review of

Pricing

Ensure continuing review of

pricing in line with the contract

to ensure the right behaviour

is being demonstrated.

Manage Service

Performance

Review and manage service

performance and ensure all

contractual obligations (public

sector organisation and

supplier) are efficiently

managed.

Conduct Service Audit

Conduct service audit and

benchmarking and assess and

implement improvements in

accordance with the

innovation process.

Monitor and Review

Security

Monitor and review security

arrangements and ensure that

any changes in the legal and

regulatory frameworks are

tracked.

Risk Management

Manage service providers risk

whilst effectively governing

and involving the supplier

relationship.

Documentation

Management

Ensure documentation is

maintained.

Rapidly Address Issues

Rapidly address and resolve

disputes and issues.

6-3

Exit

Optimise Phase - Roadmap

The Optimise Phase roadmap defines the key tasks to be completed during the Optimise Phase and

the outcomes to be achieved.

Benefits Tracking Template

Communication Plan

Supplier Relationship Management and Communication Template

6. Optimise Phase Activities

Optimise Phase Tools And Templates

6.1 - Assess Value Leakage & Track Benefits

6.2 - Manage Continuous Improvement

6.3 - Prepare Future Strategy

6.4 - Manage Commercial Obligations

6.5 - Optimise Supplier Relationship

6.6 - Manage On-going Demand

6.7 - Manage Change

Optimise Phase Stage Gate

Active Monitoring End of Term & Draft Future Strategy

Outcomes

Programme Management Office Activities

Mobilisation, Project Governance & Risk Management

6-4

Exit

6.1 Assess Value Leakage & Track Benefits

A key management tool of any

structure is a mature benefits

tracking approach including all

KPIs agreed as part of the

Service Level Agreement as

well as qualitative factors. In a

multi-year contract achieved

benefits are likely to differ

from projections for any

number of reasons but active

benefit tracking will enable the

source of such differences to

be understood and articulated

enabling ‘value leakage’ to be

identified and remediation

plans against deviations to be

developed.

Along with retention and

maintenance of the original

business case, it is

fundamental to:

Implement robust invoice

verification processes and seek

to manage by exception non-

verified spend.

Regularly audit and update

inventory records and

compliance to inventory

obligations.

Other financial processes that

must be considered include:

Forecasting and budgeting

(along with demand and

supply management).

Internal allocation and

recovery processes based on

actual consumption rather

than historic data or other

models.

A Benefits Tracking template

(10) is available at

http://esd.per.gov.ie/guidance

-and-resources/

6.2 Manage Continuous Improvement

Innovation is often a victim in

ESD arrangements. Once an

arrangement is on-going and

the focus is on meeting

contractual transformation

objectives or steady state

delivery, any initial impetus

around on-going innovation

may subside.

However a lack of internal

innovation is often an

underlying driver for ESD in the

first place as public sector

organisations are looking to

benefit from the scale and

research and development

capabilities of a new service

supplier. De-prioritising

innovation therefore

undermines the long-term

value of an ESD initiative.

To avoid missing out on

innovation opportunities,

public sector organisations

should recognise its

importance by instituting

processes to incentivise,

capture and sensitively review

innovative thinking, for

example through facilitated

forums where ideas can be

presented.

Benefits should be tracked on an on-

going basis to determine the success of

the arrangement and the status should

be reported to senior management.

Benefits Tracking Model

Benefits should be tracked on an on-

going basis to determine the success

of the arrangement and the status

should be reported to senior

management

Benefits Tracking Model

6-5

Exit

To encourage ideas any

administrative overhead (red

tape) around submission and

review of proposals needs to

be minimised to enable good

but immature ideas to be

investigated. That said,

innovation can still be

encouraged within a four

phased structured framework.

Idea Generation – large

numbers of ideas

generated for discussion.

Formulation – ideas are

formed into more

concrete potential

solutions and may even be

presented at forums.

Proposal submission –

well-formulated ideas are

documented in a

structured way that

enables comparison and

financial evaluation.

Realisation – approved

proposals are translated

into projects and actions,

accompanied by tracking

of the benefits.

Ideally this process should be

made explicit and enshrined in

the process. Management of

this process should be assigned

to a specific governance body,

linked to the commercial and

contract management

function.

6.2.1 Innovation Management Process

6-6

Exit

6.3 Prepare Future Strategy

6.3.1 Retendering

Ideally all commercial

discussions should be reserved

for the commercial team and

all agreements should be

documented, signed off and

logged in a contract library.

Experience shows that a

relaxed approach to

commercial management

governance can result in major

issues for public sector

organisations ranging from

simple disagreements to

complex disputes for delayed

or non-delivery and disrupted

services.

As the contract progresses

towards its natural expiry date

long-term planning and

preparation for the next steps

is a critical activity.

A new contract should:

Provide opportunities to

improve pricing.

Increase service

performance.

Include any change of

requirements/demands

from the end customer.

6.3.2 Plan for End of

Contract Term

As an ESD initiative moves

through its term, operational

and contractual requirements

evolve and changes to the

arrangement are likely. Such

evolution needs careful

commercial management to

ensure the true, long-term

implications of changes are

understood and that

procurement rules are

observed.

Strong, experienced and

sophisticated contract

management is essential. Good

contract management

recognises that benefits must

accrue to both the supplier

and public sector organisation

and that negotiation is not

always ‘zero-sum’.

Contract management scope

must include the following:

Managing and tracking

public sector organisation

and supplier obligations.

Managing contract

compliance.

Maintaining a contract

library for contractual

documentation

(CSSO/NPO).

Providing contract

interpretation and advice

(CSSO/NPO).

Signing off of all key

decisions and formal

correspondence.

Identifying change

requirements during the

term of the contract and

managing the contract

change process.

6-7

Exit

6.4 Manage Commercial Obligations

6.4.1 The Importance of

Optimisation

Implementing and effectively

managing the optimisation

activities outlined in this

section will increase the

likelihood that the projected

benefits of the arrangement

are realised, resulting in

greater satisfaction amongst

the internal customers and a

greater likelihood that financial

benefits and expectations are

realised.

6.4.2 Qualitative

Benefits of Good

Optimisation

Optimisation initiatives should

be qualitative as well as

quantitative ensuring that

intangible methods of adding

value are managed effectively

to increase the value of the

ESD contract to the Public

Sector Organisations. Lack of

focus on key relationships and

focusing purely on financial

outcomes can reduce overall

contract value.

Symptoms of poor

relationships include frequent

conflict escalation, greater

requirements to audit and low

internal satisfaction.

6.5 Optimise Supplier Relationship

6.5.1 Assess Supplier &

Contract Performance

The key to ensuring the

contract performs against

objectives is an efficiently

functioning governance model

and strong senior

relationships.

Achieving this can be

challenging but critical success

factors include:

Ensuring regular service

level/ delivery review

meetings take place.

Ensuring senior

interactions and meetings

with the supplier take

place regularly and at least

as per contractual

commitments.

Ensuring interactions

focus on the right things,

6-8

Exit

good preparation;

appropriate inputs and

facilitation are required to

ensure clear, fair and

informed decisions are

made.

6.5.2 Develop Supplier

Relationship &

Communication Plan

Building a good relationship

with the supplier and ensuring

strong communication

channels will help with the

early identification of issues or

unforeseen changes that may

be required. The client and

supplier will have to work out

where the responsibility and

accountability of these

changes lies.

Supplier relationship and

communication plans (5)

should be developed to ensure

there is a plan in place to

handle any unforeseen issues

and to incorporate these into

the service level agreement.

Supplier relationship and

communication plans will

identify:

The process / sub process.

Whether input is provided

by the client / supplier.

What the input and the

outputs are and where

they are stored.

The responsible and

accountable parties.

The parties who are

consulted.

The parties who are

informed.

Supplier Relationship Management and Supplier Communication tools (11) are available at

http://esd.per.gov.ie/guidance-and-resources/.

6.5.3 Improve

Governance

Well-designed performance

monitoring is an important

part of Supplier Management.

The implementation of a

balanced scorecard approach

which monitors a broad range

of performance indicators is

good practice.

This may include:

Customer satisfaction

(formal and informal, e.g.

via survey).

Service delivery

performance (i.e. via

complying with traditional

service levels).

Relationship alignment

(e.g. via annual senior

interviews).

Other public sector

organisation strategic and

operational objectives.

The right scorecard will help

identify issues early, measure

value rather than just

operational metrics and focus

discussions, energy and

decisions on improvement

activity in the right places.

6-9

Exit

6.6 Manage On-going Demand

Although cost reduction is not

always an explicit primary

objective most ESD initiatives,

nonetheless, seek to reduce

costs for particular services.

While well-constructed

programmes can help address

the supply side of such service

provision, neglecting the

quantity and nature of

underlying demand, risks

compromising the business

case and can erode savings.

Although direct contact

between the supplier and the

public sector organisation may

appear beneficial, suppliers

consistently attempt to create

a privileged position directly

with the business. More often

than not, these privileged

positions may lead to supplier

lock in where it is difficult for

the organisation to carry out

the service without the

supplier or their skilled

personnel. A SMO removed

from service delivery will be

more objective and help

reduce this risk.

As in any type of relationships

both public sector organisation

and supplier have a

responsibility to work together

to achieve the objectives. To

successfully achieve this, there

needs to be an awareness of

‘language effect’s and ‘varying

loyalties’ in the conflict and

cooperation cycles to facilitate

the development of alliances

and partnerships.

The key in any ESD project is to

try and avoid the conflict

phase. Using language that is

constructive and propositional,

such as words like ‘we’ and not

‘I’, can help build collaborative

relationships with your new

partners. Working through

partnership is of course a lot

messier than the ‘cycle’

suggests, with conflict and

cooperation both present at

most points in a change

process. However, focusing on

the collaborative cycle, being

as transparent as possible and

building trust will help

minimise any potential conflict

and result in greater outcomes

being achieved.

6-10

Exit

6.7 Manage Change

Numerous factors can lead to a

successful ESD project.

The personal skills, knowledge,

and attributes of the lead ESD

manager are vital. In addition

to the core skills such as

procuring and contracting to

obtain the best value for

money, other required skills

include an ability to engage

with people effectively; project

management skills and

excellent communication skills.

Furthermore, effective

negotiating skills determine

how well you influence,

persuade, and collaborate with

others. Negotiating a new ESD

project is a fluid process that

includes situations where you

may have little or no direct

control over key people who

have little desire to move to a

new system or process.

It is important that you only

introduce an ESD project when

you are in familiar territory

with your credibility well

established. It's possible to

build rapport in under a

minute if you know what

you're doing. Trust begins by

recognizing and respecting

someone's negotiable and

non-negotiable boundaries.

This helps you avoid having to

backtrack later because you

missed them early in the

relationship. The building

blocks of influence and

persuasion ultimately leads to

your establishing personal

credibility, which opens the

doors needed for introducing

new projects and new ways of

working in your organisation.

Being comfortable in "your

own skin" means both

awareness of your strengths

and acceptance of your

weaknesses. It is advisable to

design a negotiations strategy

that leverages your strengths

and unique contributions,

using members of your team

to fill in any skills gaps and so

cover any weak areas.

Doing your homework before

introducing a new ESD project,

even if this project just tweaks

an existing process, is

important as this knowledge

then increases your chances of

gaining support for any

proposed changes. Knowing

whether this is a new idea or a

reinvention of something tried

once before is really useful.

Knowing why it was not

successful the first time is

important.

Understanding your role and

responsibilities when

negotiating change and making

accountability very clear to all

potential suppliers. Be clear

about what you need to

achieve and ask suppliers what

they require of your

organisation to make this

partnership work. Remember

that change is ultimately about

people, so time spent building

rapport with suppliers and

explaining the process to your

staff is time well spent. Finally,

the partnership has to work for

both parties, so ensuring

everyone is clear about what is

expected early on, can prevent

problems building up and

potentially destroying an

otherwise successful ESD

initiative. .

The drivers and complexity of

a contract change event will

determine which course of

action to take and how

complex the process will be.

6-11

Exit

6.7.1 Remediation

Aimed at resolving specific

issues that may exist in a

relationship or the

provision of services.

Should be mutually

beneficial

May or may not entail a

change of contract terms.

6.7.2 Restructuring

Wider scope engagement

that is typically mid-term.

Public sector organisation

needs to fundamentally

change the shape of the

initiative to support a

change in strategy or to

eliminate major issues.

Aimed at changing the

scope, level and /or price

of the services. This will

have procurement

implications and guidance

should be sought.

6.7.3 Renewal/Re-

tendering

Driven by expiration of

existing contract or

breach.

Use this as an opportunity

to introduce additional

providers into the mix

6-12

Exit

Key Points to Remember

Comparative management

information from

participating departments

on any single ESD initiative

that helps facilitate

effective redeployment of

skills is essential.

The more suppliers know

about ESD the more they

will understand the

potential benefit for their

business of providing

services to public bodies.

To ensure transparency in

the ESD relationship,

service providers of ESD

initiatives should be

encouraged to reveal how

successful or otherwise

their ESD initiatives have

performed versus their

business case including

any customer satisfaction

rating of their service

provision. Any other

funding suppliers receive

from government (such as

employee funding via the

job-bridge scheme) should

also be disclosed to ensure

comparisons made

between suppliers are

accurate and fair.

It is important to ensure

there are low barriers to

entry. Reducing barriers to

enable smaller

organisations tender for

ESD contracts are in all

stakeholder interests, the

department gets more

choice and competitive

pricing potentially; the

supplier gets an

opportunity to quote and

potentially grow their

business and the customer

potentially gets an

improved innovative

service delivery. If there

are large investment costs

for providers to get up and

running in a new ESD area,

departments should look

at reducing these barriers

to open the market to

smaller organisations.

‘Simplifying the tenders’

procedures and reducing

financial requirements of

providers are ways to

reduce barriers of entry.

Once there are plans for

continuous service

provision, having low

barriers to exit helps drive

service improvement since

poor providers exit the

market.

Incentivising desired

supplier behaviours to

ensure that the

achievement of complex

outcomes is essential.

Confirming that new

suppliers are not just

cashing in on the easier

jobs and ‘cream skimming’

is also important. Try to

identify any such

loopholes using a pilot

initially.

Avoid focussing on a

narrow set of

departmental needs; take

an holistic view focussing

not solely on cost

reduction but also on

improving the service

delivery; remember to

include quality, diversity

and levels of competitions

in your parameters;

remember to include all

costs in your business case

including the:

Costs of researching

services for ESD and

putting RFT’s

together;

Costs of running the

tender process;

Costs in monitoring

the performance of an

external service

provider;

Strategic costs in the

potential loss of core

competencies from

the public service ;

Strategic cost of the

risk of losing public

trust if the provider is

poor or has a poor

reputation in the

marketplace; and

Time cost of multiple

stakeholders

developing a

collaborative

relationship with

suppliers etc.

6-13

Exit

NRA Case Study – The Optimise Phase

In the past four years in

operation the NRA have

achieved successful results

evidenced by satisfied

customers, an ever expanding

customer base and strong

revenue growth during tough

economic times. The approach

of partnering and collaboration

with their suppliers in the

management of the business

(as opposed to adopting a

more conservative and

traditional contractual

relationship with little or no

innovation encouraged) has

enabled them to introduce and

manage change successfully

across a number of business

areas and they will continue in

this manner to deliver further

improvements across the

business.

They are currently focusing on

growing the business while

reducing costs and continuing

to improve compliance (i.e.

tolls paid on time). They also

aim to further improve the

customer experience by

introducing more simplicity

and convenience by, for

example, upgrading the

customer website so that it is

fully accessible from all types

of devices (e.g. laptop, tablets

I-phones).

Supplier Management:

The NRA realise that Supplier

Relationship Management is

key to the success of project

delivery and so place great

emphasise on maintaining a

good relationship with Sanef

through regular informal and

formal communication

procedures. Team building

plays a key role in maintaining

this good relationship.

Performance Measurement:

To assess performance the

NRA required simple and

relevant performance

measures. They introduced

benchmarking reviews, visits

and conferences with Sanef

which play a role in assisting

the development of simple

performance metrics

The following M50 KPIs were

identified:

KPI 1 – Transactional Toll

Revenues - Revenue

banked per ‘tollable’

vehicle.

KPI 2 – Global Recovery

Rate - Total percentage of

transactions which have

been paid.

KPI 3 – Road Side

Equipment Revenue

Leakage - Transactions

captured which could not

be charged due to poor

Licence plate data.

KPI 4 – Licence Plate

(ANPR) Misreads -

Misreads impacting

customers.

KPI 5 – Payment Trends -

Payment trend for

unregistered domestic

users.

Key Success Factors:

The NRA has identified the

following key success factors

for successful service delivery:

Focus on delivering a

customer centric service

efficiently and cost

effectively.

Understand all

stakeholders’ short,

medium and long term

goals.

Ensure delivery is

customer focussed and

not process or technology

led but also understand

and appreciate the part

technology and process

plays in success.

Ensure relationship is two

way, open and honest.

Ensure contractual

alignment to desired

outcomes and openly

acknowledge

misalignment even if not

fixable in the short to

medium term.

Always share with your

clients and stakeholders

what matters to you.

Respect and embrace the

differences in cultures and

approach of all and use

this to enhance the overall

service delivery.

6-14

Exit

Available Tools

Supplier Relationship Management and Communication Template (11)

Benefits Tracking Template (10)

6-15

Exit

Exit

Optim

ise

Exit

7-1

Exit

Chapter 7

The Exit Strategy

The Exit Strategy - Overview

External Service Delivery is

becoming more important to

the Irish Public Sector, given

the long-term nature of such

projects and the increasing

trend to outsource functions.

As a result, it is vital that

organisations are able to retain

the flexibility to transition

smoothly between suppliers

and solutions, while ensuring

that continuity and quality of

service can occur. Having

effective exit arrangements in

place that guarantee such

flexibility is an important part

of any Public Service

organisation’s longer term ESD

strategy. Furthermore, the

importance of planning a

public procurement

competition in plenty in time

must be underlined in this

context.

This ESD Handbook outlines

and explains the phases of a

typical ESD arrangement.

While it is hoped that any new

ESD project will result in a

mutually beneficial

relationship between the

public entity and the supplier,

various things may occur to

cause the contract to fail.

Typical reasons that may cause

the relationship to end include:

The ESD agreement has

reached its expiration date

and the outsourced

services are no longer

required;

The ESD agreement has

reached its expiration date

and your organisation has

decided to deliver the

service in-house.

The ESD agreement has

reached its expiration date

and your organisation has

awarded the contract

elsewhere following the

competitive tender

process;

The relationship between

the supplier and your

organisation has broken

down and trust is no

longer present.

Your organisation has

decided not to continue

with the ESD project

during the contract

period. This may be due to

poor performance, fraud

or bankruptcy.

Exit Strategy Principles

The exit/transition of an ESD

contract can be a complicated

process. An Exit Strategy is

necessary to reduce risk, keep

costs to a minimum and

ensure effective timeframes. It

may be important to consider

a Public Procurement Plan in

this regard. Most importantly,

in the original ESD contract,

you will need to include exit

provisions. These provisions

could contain clauses to allow

for the renegotiation or

termination of services by

either party (so far as is

permitted by law). You should

seek legal advice before

considering any renegotiation

of the original contract. Below

are the main principles to keep

in mind when planning your

Exit Strategy.

Prepare a Business Case

Should you choose to end the

arrangement then a Business

Case will be needed, outlining

the benefits versus the risks of

ending the relationship.

Make sure resources are

in place

Resources will need to be put

in place to ensure the

7-2

Exit

continuance of service

provision; transition to a new

provider (or the move to in-

house service provision) and

wind down of existing

provision by the outgoing

service provider.

Legal routes

A crucial part of your exit plan

will involve preparing your

evidence to ensure you have

enough written information to

prove key objectives have not

been met. When your case is

ready choose the correct

forum in which to proceed

(negotiation; mediation;

arbitration or litigation). Each

has advantages and

disadvantages.

Establish exit procedures

In the case of relationship

breakdown, provision should

be made in the ESD contract

that all such issues are to be

resolved first at Project Team

level, moving if necessary to

higher levels of authority in the

governance structure.

Where problems are not

resolved through consultation,

the process may progress to a

legal route such as mediation

or arbitration.

7.1 Exit Management Checklist

7.1.1 Exit Governance

It is essential to ensure that an

exit plan is in place to make it

easier for your organisation’s

operations to continue as

usual during any exit of an ESD

contract. All parties must

adhere in full to the exit

provisions contained in the

original contract (see following

section) and there should not

be any disruption to services

during in any period of

transition/handover.

In order to achieve this, you

are advised to establish an exit

management team who will:

Manage the end of the

contractual arrangement.

Decide how best to plan

any handover to a new

supplier.

Exit management team

key tasks

Make sure resources are

in place to ensure

continuity of services

during the exit/transition.

Carry out a risk

assessment for the

exit/transition and identify

any important issues that

could arise as a result of

the handover/termination.

Communicate fully any

governance processes that

should be followed during

the exit/transition to all

relevant parties, and;

Monitor the existing

supplier and make sure

they are keeping to the

original ESD contract.

7.1.2 Exit Provisions

You will need to create a stage

based exit provisions which

should be contained in the

original ESD contract. The exit

provisions should outline

several key arrangements.

These should include notice

periods required as well as any

exit obligations which must be

fulfilled by both your

organisation and the supplier.

The exit provisions should

follow a methodology which is

focused on a successful

completion of the ESD

contract. The next part of the

handbook explains the three

stages of the exit/transition

which should be outlined in

the exit provisions within the

ESD contract.

7-3

Exit

7.1.3 Initial Stage of the Exit / Transition

The initial stage of the

exit/transition involves

preparations to begin finalising

details with the outgoing

supplier. As previously

mentioned, you will also need

to set up an exit management

team to manage the

termination of services

provided by the outgoing

supplier. You will need to

confirm a number of key

actions with the outgoing

supplier in order to prepare for

termination of the contract.

These may include:

Confirming the status of

current projects and any

remaining work the

outgoing supplier has to

complete.

Confirming a list of

authorised supplier staff

and the locations they are

working in to avoid the

potential for any conflict.

Confirming any processes,

materials, resources and

passwords used by the

outgoing supplier.

Confirming that the ESD

contract and

Confidentiality Agreement

(if any) are being

implemented.

You will need to agree with the

outgoing supplier on how to

manage any identified risks

that could arise. Any

unresolved problems relating

to the termination will also

need to be addressed.

You will need to plan for any

transfers of services and

processes between your

organisation and the outgoing

supplier.

This will involve:

Listing all of your

organisation’s assets

which are currently in the

possession of the outgoing

supplier.

Listing all 3rd party

contracts and licences that

the outgoing supplier was

using to provide the

service. If these cannot be

transferred to your

organisation, the supplier

must provide an

alternative.

Making plans to remove

all of the outgoing

supplier’s external

interfaces within your

organisation, taking into

account any impact there

might be on your

organisation’ s service

provisions.

7.1.4 Middle Stage of the Exit / Transition

During the middle stage of the

exit/transition, you will start to

plan working and handover

arrangements with the new

incoming supplier. It will be

necessary to identify what

roles and processes will be

delivered by the new incoming

supplier and to recognise any

potential TUPE situations that

could arise. You will also need

help start transfer related

agreements between the

outgoing and incoming

suppliers.

This may involve:

Planning for the transfer

of resources between the

outgoing and incoming

suppliers.

Helping all parties

involved to agree on

access arrangements

during the handover

period. This might relate

to the usage of office

space by the incoming

supplier.

Planning for the transfer

of contracts/licences

between the outgoing and

7-4

Exit

incoming suppliers. You

may need to provide

relevant documentation in

relation to this.

Being aware of any

knowledge/educational

resources that may have

to be transferred from the

outgoing supplier to the

incoming supplier.

7.1.5 Final Stage of the Exit / Transition

The last stage of the

exit/transition will involve final

arrangements with the

outgoing supplier concerning

which services are finishing,

how all objectives are to be

achieved and any contractual

obligations that need to be

met. Transition planning will

also be important to manage

timelines and successful

completion of the

exit/transition. Any final

agreements between the

outgoing supplier and the

incoming supplier will need to

be confirmed. In addition, any

licences required to protect

intellectual property rights will

need to be agreed on by all

parties.

At this stage of the

exit/transition, effective

communication between all

parties will be very important.

It may be useful to design a

communication strategy to

decide how this will be

achieved.

Agreements with the outgoing supplier

You will need to confirm a

date and time for the

outgoing supplier to finish

providing services and

leave their workspace.

Arrange for access to be

removed once all work has

been completed.

Check the ESD contract

and agree any termination

related costs to both your

organisation and the

outgoing supplier and look

for possible ways to

reduce costs. Agree a

payment schedule for

these costs (if any) and for

any exit costs or

outstanding service

invoices.

The outgoing supplier may

have ownership of any in-

house developed software

or tools that are needed

for the services being

terminated. If this is the

case, you will need to

agree terms for the

transfer of these to your

organisation.

The outgoing supplier may

have data on assets

owned by them that does

not belong to your

organisation and will not

be transferred after the

termination of services.

You will need to agree on

a process for the removal

or archiving of any such

data.

Check that all data protection requirements are met.

Agreements between the outgoing and the incoming supplier

An agreement should be made

on working locations should

the outgoing supplier be

completing work at the same

time as the incoming supplier

starts their contract. This will

help to avoid any potential

conflict (note that

procurement of temporary

office space may be required).

A process for the transition of

any transferable contracts or

licences to the incoming

supplier will need to be agreed

upon.

7-5

Exit

It will be necessary for all

stakeholders to agree any

transferable asset values.

If the incoming supplier will

require any resources from the

outgoing supplier (such as may

have been agreed on in

contract negotiations), these

resources may need to be re-

confirmed and must at least

meet the outgoing suppliers

obligations as per the exit

provisions.

The final task for the public

entity and the outgoing

supplier will be to fully

complete the exit provisions

as outlined in the original ESD

contract.

7.2 Service Closure

This is the final part of the

exit/transition. You will need

to ensure that there is no

disruption to services as the

outgoing supplier exits your

organisation. Access to your

organisation will need to stop

and the transfer of any

required data to the incoming

supplier will need to take

place.

The exit/transition should be

fully completed as outlined in

the exit provisions contained in

the ESD contract.

Transfer any required user

IDs or passwords from the

outgoing supplier to the

incoming supplier.

Make sure that all forms

of access for the outgoing

supplier are stopped and

that they return any

access permits/passes

used to gain entry to

locations within your

organisation.

It will be important to

ensure any encrypted

devices are returned by

the outgoing supplier

within a suitable

timeframe and that any

important hard copy data

is correctly disposed of.

Any unresolved disputes

between the outgoing

supplier and your

organisation should be

resolved with a full and

final settlement.

Finally, the outgoing

supplier should finish

providing services and

vacate your organisation’s

premises.

7-2

Exit

Conclusion

I

Irish Public Service ESD Examples

Managed

Services

An Garda Síochána - Go-

Safe

The GoSafe consortium has

been contracted by An Garda

Síochána to operate safety

cameras on Irish roads. Go-

Safe will provide 6,000

enforcement hours and 1,475

survey hours per month across

the country. The cameras will

operate from vans which will

be marked with high visibility

reflective material and will

display a safety camera

symbol.

Business

Process

Personal Injuries

Assessment Board

The Personal Injuries

Assessment Board facilitates

anyone intending to seek

compensation for a personal

injury (other than a personal

injury arising out of medical

negligence), unless the claim is

settled directly between the

parties. Personal injury

claimants will be better placed

to avoid unnecessary legal fees

following a recent move by the

Central Bank to compel

insurance companies to

forward information about the

Injuries Board to potential

claimants as soon as they

become aware of the potential

claim.

ICT Services

An Chéim Computer

Services – Collaborative

higher education

information services

The An Chéim MIS Programme

was created to implement

common management

information systems for the

Institute of Technology Sector.

The implementations were

carried out on a phased basis

and lessons learned from each

phase were carried through to

subsequent phases.

More Examples of ESD Projects

Department ESD Project

Revenue Local Property Tax Customer Contact Centre

Private Residential Tenancies Board Contact Centre and Document Management business process services.

Road Safety Authority Driving Licences Application Processing

Department of Communications, Energy and Natural Resources

Market Surveillance for 1) Ecodesign and Labelling of energy-related products, 2) Tyre Labelling

II

Conclusion & Reference Sites

This handbook has been prepared and issued by the Department of Public Expenditure and Reform in

association with PWC.

The contents are designed for reference only and should not be relied upon for making ESD decisions

without further discussion with the Department or Programme Leaders.

For more information please contact: esd@per.gov.ie

Available Templates

No 1. Preliminary business case

No 2. Preliminary business case: financial analysis metrics

No 3. Transition roadmap and plan

No 4. Process assessment template

No 5. Communications plan

No 6. Risk assessment tool

No 7. Sample supplier evaluation and scoring template

No 8. Value delivery roadmap

No 9. Transition performance reporting template

No 10. Benefits tracking template

No 11. Supplier relationship management and communication template

Reference sites

Office of Government Procurement

The main public procurement guidelines

EU Public Procurement Law

People & Organisation

Location & Asset Management

Information Technology

Change Management

Programme & Risk Management

Value

Prepare

Evaluate

CommitTransition

Optimise

Assess

Exte

rnal

Ser

vice

Del

iver

y

III

Acronyms

CPA Croke Park Agreement

CSFs Critical Success Factors

CSSO Chief State Solicitors Office

D/PER Department of Public Expenditure and Reform

EI Enterprise Ireland

EOI Expression of Interest

ESD External Service Delivery

HR Human Resources

MEAT Most Economically Advantageous Tender

OGP Office of Government Procurement (Formerly National Procurement Service)

OJEC Official Journal of the European Community

PID Project Initiation Document

PIN Prior Information Notification (see page 19 of this link)

PMO Programme Management Office

PSC Public Spending Code

PQQ Pre-qualification Questionnaire

RFT Request for Tender

SLA Service Level Agreement

SME Subject Matter Expert

SMO Supplier Management Office

SOP Standard Operating Procedure

TUPE Transfer of Undertaking, (Acquired Rights Directive)

4

Notes:

A

Notes: