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Supplier Forum 14 February 2011

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Presentation on theme: "Supplier Forum 14 February 2011"— Presentation transcript:

1 Supplier Forum 14 February 2011

2 Objectives of the day Provide more information about NHS SBS and how we work To gain an appreciation of some of the issues suppliers to the NHS face To facilitate a forum for sharing of ideas To enable feedback of concerns To facilitate the ongoing sharing of information To identify improvements and ways in which we could all work better to make this happen

3 Steria & Department of Health - a unique joint venture
Unique 50:50 JV Commercial organisation Joint governance Customer focus Best practice World Class Original shared service centres NHS experienced people Oracle EWA Financial support Management & Business Devt Service optimisation Best practice Offshore capability Commercial expertise Surplus Surplus cost savings saving the NHS £250m over 10 years = 12,500 additional nurses

4 About NHS SBS Core Service Lines: Finance & Accounting Payroll & HR
Family Health Services Commercial Procurement Solutions Typical savings for Trusts of between 20% and 40% Employing 1,430 people, including 670 in India 40% of NHS organisations are NHS SBS clients 27m people in England have NHS care from NHS SBS clients

5 Integrated Delivery model
Shared Services Delivery Model Onshoring / Offshoring – but truly integrated systems Integrated delivery – India : UK working together in a joined up approach as “One team” Multi shift operations - 17 hours working window - Early morning working – job ready before NHS trusts staff arrives in office Dedicated offshore transition team – cost efficient, understands offshore challenges and requirements

6 Customer Profile 130 Finance & Accounting clients
Over £31 billion payments / per annum £12 billion of NHS debt recovered per annum 60,000+ trained users on the Oracle system 57 Payroll & HR clients Paying 200,000 NHS employees Processing 2.5 million payroll transactions per annum Extending into HR Shared Services 16 Family Health Services clients NE London sector – seven Trusts East Midlands region – nine Trusts 50 Commercial Procurement Solutions clients

7 Voice of the Customer: “would recommend NHS SBS”
2007 2008 2009 2010 YES : 39% YES: 80% YES: 85% YES: 95% NHS Directors of Finance & HR

8 NHS SBS - World Class Hackett Global Benchmark
Hackett Value GridTM 2010 High 1Q 1Q 2007 Effectiveness 2004 Low Efficiency High Other Companies in 2010 NHS SBS 8

9 Summary NHS SBS on target to achieve savings for the NHS of £250m over 10 years and play a role in delivering QIPP back office targets NAO verified at least £50 million cost savings to the NHS so far Estimated revenues of around £53.4m in 2010 (12.6% growth) a successful and profitable public/private sector partnership Leveraging NHS SBS capability will result in far greater savings to the NHS NHS SBS can be a key facilitator of change in the NHS – GP consortia, GP commissioning, smooth transition to new landscape £1.06m royalty fee shared with NHS SBS clients in 2010 (in addition to cost and efficiency savings already achieved by NHS Trusts), and expect to do the same in 2011

10 GP Commissioning

11 “...the biggest planned overhaul of the NHS in England in its 63-year history”
19 January 2011 Presented in a White paper “Liberating the NHS” – currently going through parliament at second reading stage

12 Aims of the proposed changes
The main aim of the change is to put patients at the heart of everything the NHS does; focus on continuously improving those things that really matter to patients - the outcome of their healthcare; empower and liberate clinicians to innovate, with the freedom to focus on improving healthcare services To do this certain admin functions are being removed putting the control into the GP Practices, who will become part of a local consortia There is also a review of the Arms Length Bodies such as NHS Direct, NHS Information Centre

13 Expected timeline PCT Commissioner Services PCT Provider Services
April 2011 April 2012 April 2013 April 2014 PCT Provider Services PCT Commissioner Services ALB’s & SHA’s All trusts become foundation trusts Gain Foundation status or cease to exist Services to move to a new home Organisation disappears Organisation disappears

14 Commissioning will have 3 Main Pillars
GP Commissioning Consortia National Commissioning Board National Commissioning Development Programme Commissioning Support These 3 groups will commission/buy healthcare so majority of their invoices will be from healthcare providers Won’t own assets Majority of non healthcare supplier invoices will be, temporary staff, travel and subsistence and office supplies Commissioning support may come form PCT Clusters which are now forming Until April 2013 you would invoice separate PCT (not cluster these are admin arrangements not legal entities), from April 2013 invoice new Commissioning support organisation

15 GP Practice / NHS Link

16 Serving a local community Leading Commissioning
Leading people Leading a consortium Serving a local community Leading Commissioning Leading improvement & innovation Managing self Forging partnerships Partnering with patients & the public Engaging professionals Promoting research & development Leading a team Business leadership Partnering with local authorities Setting priorities Continual quality improvement Setting vision Media & communication Partnering with providers Shaping demand Promoting sustainability Leading change Horizon scanning Evaluating population needs Designing services Governance Protecting & promoting health Leading contracting Market shaping Sharing commissioning Points to mention: 5 domains, 24 competency areas some more in-depth than others, for practice staff. We all need to be aware of & supportive of every one every domain matters holistic, collaborative, relational approach includes both commissioning and provision commissioning built on a foundation of partnerships and an agenda of serving the public health

17 Review and Comments

18 The business of care

19 choice, commerce and care
The health market choice, commerce and care Consortia: Co-ordinate healthcare development and acute contracting for practices – manage risk pool Care Providers: Deliver care to tariff Manage input prices/costs Practices: Holder of contracts with provider and consortia Health Industry: Supply goods, medicines, equipment, staff And provide managed services Reg Health Board: Award Primary Care contracts and assess performance and healthcare with ties to local authorities and public health Patients: Choice of practice & provider

20 Increased scrutiny of procurement decisions
With healthcare organisations facing structural change to align activities to meet healthcare business objectives and pressures……. Challenges and opportunities balance out Income suppressed in line with demand - QIPP and CIP challenges – Costs and risks from block contracts - Greater market competition and choice Increased scrutiny of procurement decisions Increased opportunity for focused optimisation of spend as commercial lever - freedom for collaboration and partnering - greater use of service/supply contracts - rewards for high performance - growth in private patient business

21 CPS - translating these challenges into simple service offers to meet healthcare business objectives
Systems to direct and manage caresupplies, drive costs down and manage risk Insight to define, design and deliver improvements in care, and business process and performance, driving income

22 Procurement and SBS CPS solutions focus on understanding the management of costs, and focus on care
Cost of population health utilisation Cost of patient pathway Cost of medicines management Cost of purchasing Cost of provider performance and quality Cost of outcomes Cost of the business

23 The SBS Commercial Procurement Solutions
The business cycle driving our services Understanding our costs and spend Contracting compliantly to secure supplies, and drive value Purchasing processes and systems to support day to day operations Financial and accounts systems to manage transactions Tailored Procurement and contracting solutions for bespoke needs

24 The SBS Commercial Procurement Solutions process aligned services
Spend Contract Catalogue Purchase Pay Perform The SBS Commercial Procurement Solutions process aligned services

25 CPS – Products and services for business challenges.
SBS group interests Optimising Spend Services: Spend analysis and profiling Legally compliant routing and aggregation Optimisation analysis Procurement Services: Contract & framework portfolio Contracting calendar SAP Supplier catalogues Procurement : Spend analysis tools Etendering tools Evaluation tools Catalogue & P2P systems Commercial services: Procurement & contracting project management Contract management services Inventory management

26 The SBS CPS strategic sourcing `contracting’ offer
Spend Spend capture and data cleansing & coding Spend profiling Spend & price benchmarking Spend matching Contract Strategic sourcing opportunity assessments Spend mapped to frameworks and contracts to secure supply and value Rolling contracting programme Enhanced contracting through national competitions and SAP Managed contract performance and SRM Catalogue Catalogues of suppliers/products and prices Maintained database Integration service with trust systems Links to spend benchmarking services and P2P

27 Strategy steps in increasing spend management
Spend Under Management Benchmarks*: Laggards 30% - Industrial average 30-70% - Best in class 70% Analysis of spend data Data mapped to contracts and frameworks Procurement plan to aggregate volumes and shape markets Volume committed contracts and catalogues Purchase to pay systems providing compliance, control and focused spending

28 Trust objectives Reduce Clinical variation Spend fragmentation
Increase Best practise pathways Product standardisation Use of economies of scale

29 The vision for managed spend
Reduction in variation, improved performance Aggregation of demand, driving value Managed compliance, supporting control Strategically spent and levered for value All NHS £

30 Mini Competitions – Specific Agreements
Spend refined, aggregated and commited over time SAP Mini Competitions – Specific Agreements Framework Agreements All NHS expenditure covered by Frameworks/Contracts

31 The SAP pathway – The route to business performance and savings
Capacity Review Rationalisation Standardisation Market engagement Procurement commitment Contracting Mobilisation Compliance Delivery

32 Innovation and Continuous improvement
Product Phase 1 Pathway Phase 2 Innovation and Continuous improvement Phase 3 SAP Process Analysis - Review Spend data - Benchmark Pricing Pathway Efficiency Review Review processes in pathway Product use for patient/ task Pathway workstreams -Pathway Product workstreams -Patient Level Costing Clinical Review -Share clinical expertise -Consider NICE guidance Product Validation -Developing exact specifications -Evidence based selection Product efficiency -Demand management - Right product for patient/ task Procurement -Procure with commitment Initial Standardisation Deliverables -Efficiency, savings, innovation -Full Standardisation Innovation and improvement -New product development -Implementation of innovative products Implementation and savings - Implement contractual outcome Selection of Strategic Partner Drive product development Deliver further efficiency and utilisation savings Savings and benefits delivery -Establishment of ongoing KPI’s and targets Project team; CPS, DOFS, SBS, Clinicians Supporting; Procurement, Business partners Project team; CPS, AQuA, NICE, MHRA, NPSA, Clinicians Supporting; Procurement, DOFS, Business Partners Project team; Clinicians, Strategic Suppliers, NICE Supporting; CPS, MHRA, NPSA, Business Partners

33 Strategic Advantage Programme
We will support securing supplies, procuring compliantly, and in optimising your spend volumes. 2.We will ensure there are business ready catalogues for organisations to use in operational purchasing 3.We will continue to move frameworked volumes, committed customers, and commercially responsive suppliers closer together through continuous SAP rounds. Agreements Framework Security of Supply EU compliant procurement Aggregation of expenditure Catalogues Supplier details Product Pricing Invoice Matching Link to eprocurement Strategic Advantage Programme Supplier Rationalisation Product standardisation Contracted Volumes Driven compliance

34 Getting Invoices Paid

35 Purchase to Pay Locations Four Staff 350 System Oracle 11.5.10i
End Users 55,000+ Procurement eProc

36 Purchase to Pay AP Transactions 4.5 M Payment Value £31B Procurement
Scanned Invoices 3.75 M Electronic 300,000 / 450,000

37 Purchase to Pay Returns 5% Payments Runs 25,000+ Suppliers 175,000 PO
40% Non PO 60%

38 AP Overview Post and Scanning Paper and electronic Verification
Paper documents Non PO Rules engine

39 AP Overview PO Notifications Payments Automated Supplier Compliance

40 Questions

41 Communication 175,000 suppliers 55,000 users 350 staff System Email
Clients SBS Suppliers 175,000 suppliers 55,000 users 350 staff System Outbound Inbound Reporting Statements Web

42 Action or Information? When Why What How All calls recorded
Case record created Query or follow up undertaken Automated log Action Request Process fix Follow up Case closed Client Fix Query

43 Two way communication The client told me……….
You don’t tell us when it has gone wrong The client told me………. You don’t tell us when it was resolved What dispute?

44 Lunch

45 Communication 5 Queries Overview of Invoice Status
Consistency of communication Across suppliers Across systems Self Help Improved support system for Service Desk Auto information responses Statement production Customer Focus Groups

46 Process E-invoicing E- invoicing solutions being investigated
ed invoices ADI files, etc Invoice cost Consistency of approach E- invoicing solutions being investigated Root-cause analysis with clients and suppliers Process standardisation initiative

47 Service Context Knowledge about NHS SBS and the wider context
NHS SBS as a framework? Forum on-going activity Linked-in/huddlespace Procurement Planning horizon being developed by CPS

48 Objectives of the day Provide more information about NHS SBS and how we work To gain an appreciation of some of the issues suppliers to the NHS face To facilitate a forum for sharing of ideas To enable feedback of concerns To facilitate the ongoing sharing of information To identify improvements and ways in which we could all work better to make this happen

49 Close

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