Embed - stronger together
As outsourcing evolves from a mere cost-cutting exercise to deliver against more complex objectives, including growth, innovation and transformation, partnerships require better governance and more trust than ever before.
An organisation can only be agile if in-house and outsourced teams operate seamlessly; challenges can only be overcome if there’s open and honest communication; and real innovation will only happen if everyone works towards the same vision.
East Cheshire NHS Trust and Arvato UK have been working in partnership since 2013 to operate the Trust’s HR shared service centre. Arvato delivers professional and transactional HR services, including employment relations consultancy, learning and development and recruitment to the Trust and the centre’s existing customers. Some 60 employees transferred to Arvato as part of the agreement.
In this article, the heads of the partnership – and former colleagues – Rachael Charlton, Director of Human Resources and Organisational Development, East Cheshire NHS Trust, and Sally Campbell, Director, Health, Arvato UK, discuss how teamwork helps to achieve results together.
In addition, Professor Paul Sparrow, Centre for Performance-led HR, Lancaster University, and Dr Jill Miller, Chartered Institute of Personnel and Development (CIPD), share the findings from a research project involving the Arvato and East Cheshire NHS Trust partnership on the business impact of collaborative working.
Achieving results through teamwork
Rachael Charlton (East Cheshire NHS Trust): “It was a tough decision to outsource a key strategic function like HR. Three quarters of NHS costs are spent on staffing and the quality of people has a huge impact on patient experience. But we felt that, with a private sector partner, our shared service centre could reach its full potential and continue to improve services while keeping costs down, freeing up the Trust to focus on what it does best – patient care.”
Sally Campbell (arvato): “We invested a lot of time, especially at the beginning, to get things right. We wanted to paint a picture of what the future would look like together. On a practical level, this means jointly developed key performance indicators to measure progress against our objectives.”
Rachael: “However, KPIs will only get you so far; it’s the commitment and trust on both sides that makes the partnership work. It really helped that we were so used to working as one team, so we were speaking the same language and that made it easier to develop a joint vision…”
Sally: “Yes but you were my colleague and now you’re our client! [laughs] It’s interesting how your outlook changes. We’re now part of a private sector business which approaches things differently. You might start to question things you did before, but you need to stay mindful of the views of the people in the retained organisation. Rachael’s teams on the ground have such a deep knowledge and understanding of the NHS and its challenges, and that’s a real asset.”
Rachael: "Both partners need to listen to each other. That’s why governance is so important – you need the right forum to move things forward strategically, but also to address the nitty-gritty, day-to-day challenges.”
Sally: “Our internal communication channels are still really interwoven. Arvato employees receive the Trust’s newsletters, and we ensure we have a feedback loop back into the Trust. It’s important to make people feel part of the same team, but it also helps both organisations to share improvements. For example, Arvato has brought in new methods of lean working and customer care that the Trust is now thinking about implementing in other areas.”
Rachael: “If the communication is broken, it affects not only the partnership but day-to-day operations. Many processes that Sally’s team handles get passed back and forth between Arvato and the Trust. Having clear roles, effective engagement and on-going communication is vital for the quality of the service we receive.”
The business impact of collaborative working
Professor Paul Sparrow, Centre for Performance-led HR, Lancaster University, and Dr Jill Miller, Chartered Institute of Personnel and Development (CIPD)
The nature of work is changing. Organisations operate in more specialised, collaborative and flexible ways. Should we expect that employee satisfaction will translate into greater productivity and improved service standards in collaborative work settings? Not necessarily. It first depends on addressing some broader people issues. We draw upon learning emerging from the Beyond the Organisation research project conducted by the Centre for Performance-led HR at Lancaster University and the CIPD. We are looking at a range of collaborative settings: working through joint ventures at Shell; integrating HR across the supply chain at Rolls Royce; site licence and regulatory oversight in the nuclear industry; integrated service provision in West Sussex County Council; strategic collaborations in Devon and Cornwall Police Authority; and changes in service delivery in East Cheshire NHS Trust.
Why do people matter so much in the partnered delivery of such operations and services? Three challenges stand out:
- the need to understand how the whole partnering network operates, when and why a more collaborative service model may be valuable and beneficial, and building the knowledge transfer and learning capabilities necessary to enable this insight
- managing employee engagement across the partnership, and the need for employees to cope with dual or even multiple vocational and organisational allegiances and identities
- developing leaders capable of leading for the network, and not just in the interests of the constituent organisation they are aligned with
Consider the recent changes in the NHS. Cost pressures have seen rapid evolution in the blueprint for professional and transactional HR services. In East Cheshire NHS Trust these evolved through arms-length services provision by Cheshire HR Service in 2006, acquisitioned by Arvato in 2013. As individuals transfer between one entity and another much of the tacit knowledge needed to deliver cost, efficiency and quality benefits still sits within the same heads! But these heads now sit in a different organisation, driven potentially by different missions. They have to share their knowledge, networks and insights, but be persuaded, coached and developed to do this. They have to combine their historical insight with the benefits created by the systems and technologies of their new hosts. If identity is important in strategic outsourcing arrangements, it is even more important when professional and vocational groups have to work collaboratively.
Leaders must balance competing demands and goals between ‘home’ organisation and the network. Levels of trust vary within partnerships and tensions become inevitable. When leaders meet they must leave old allegiances at the door and act in accordance with the culture and values of the broader network. They must influence the strategic dialogue of other leaders and ensure informal, open and honest conversations across all of the key nodes or connections in the partnership. Meanwhile key players move into and out of the network. Changing leadership models is crucially important to partnership effectiveness. Without this, there will be no agreed definition of the situation, no agenda for problem-solving, and no rules to guide decision-making.
This is why going back to our original question “does employee satisfaction translate into greater productivity?” we say only once our three challenges above are dealt with.