1. Source: SSC.Sweetman.CGSC1 Corporate Governance Scrutiny Committee 31 May 2007 SHARED SERVICES CENTRE REPORT By Ron Sweetman Head of Shared Services Centre CG_MAY3107R09.ppt

2. Source: SSC.Sweetman.CGSC2 In March We Reported Our first 4 teams have moved successfully into our new office, Chiltern House. These were Pensions, Health & Safety, Learning & Development Phase 1, and Accounts Payable. All four are now operating business as usual The office environment is good and the teams are happy and well motivated We have actively engaged with Unison addressing the elements of our change, and the relationship with Unison is a good one Out of 100 people now in the Shared Services Centre about 10 rely on public transport for their journey to/from work. There were a couple of teething troubles with our public transport solution for the journeys, but these were quickly addressed. We are continuing to keep an eye on the situation; we have consulted generally and are beginning to consult with people directly impacted on their experiences Procure to Pay went live February 5th. We expect a few issues to be revealed as our P2P gets fully underway but so far it has gone very smoothly The overall project status is amber which means we are on track and in control, we have things to do but we expect to manage these successfully Our project budget is £6.2M and we forecast to spend this

3. Source: SSC.Sweetman.CGSC3 Our May Report Is The Shared Services Centre took its 2 nd floor at Chiltern House (the 1 st floor) exactly on time on 14 th May and we held our official opening on 18 th May. Our project budget is £6.2M and we still forecast to spend this. We spent £1.2M in 2006/7 and expect to spend most of the balance (£4.8M) in 2007/8. We are committed to achieve the benefits expressed in the business case and as teams come on board we are right sizing them to be consistent with the business case. First teams came in on target headcount. HR will come in at target headcount. We are still working through Finance & Management Accounting but are clear on the target headcount. Transport appears no longer to be a ‘hot topic’ but this is a sensitivity still because approximately 100 extra staff will be joining shortly. Procure to Pay went live February 5 th. It went very smoothly initially but as anticipated we are encountering some transitional problems and invoices that do not match are blocking. This is not untypical with new Procure to Pay processes such as ours where we have a simultaneous process and technology changes. The position is being monitored and blocked invoice situations are being addressed. The overall project status remains amber which means we are on track and in control. For what we have done and for our next go-lives we are more green than amber.

4. Source: SSC.Sweetman.CGSC4 Our Future Go-Live Dates Are: Money Management will go live 18th JuneAmber – early HR Workforce Information will go live 18th JuneAmber – on time Employee Advice & Support will go live 18th JuneAmber – on time Payroll will go live 25 JuneAmber – on time Insurance will go live 2nd JulyAmber – early Recruitment will go live 2nd JulyAmber – on time Remainder of L&D will go live 9th JulyAmber – on time Financial & Mgt. Acctg. will go live Oct/NovAmber – on time Income will go live March/Apl ‘08 (dep. on LiNK) Not Started – expect on time

5. Source: SSC.Sweetman.CGSC5 Our Concluding Status Is In general things are settling down well We have not lost key skills. The only group that has experienced a staff turnover was Pensions but good replacements are in place and we are now stable. Key milestones are being achieved and approximately 100 new people will join in June & July There has been no programme slippage to date and we are working to bring forward Finance In the business case, Finance was scheduled to go live in January 2008; we expect to bring this forward to October 2007 True Shared Services maturity we occur over the next few years. Continuing reengineering will occur over the next year or two following a model of ‘move and improve’ which is allowing us to engage our teams more. We are beginning to work at developing a culture of continuous improvement and we have begun to run our teams through in-house Shared Services led continuous improvement training. In some ways completing the creation of our Share Services Centre is an end, in many ways it is a beginning!