Accountability Model

The principal-agent problem may be as old as economics itself and has yet to be solved to anyone’s complete satisfaction. So it’s no wonder that transfer payments– from one level of government to another or from government to non-profit and private organizations– is a hotbed of issues related to accountability.

The question is how to ensure appropriate accountability and outcomes when one party is providing the funding and the other party is delivering the services. This is an especially thorny subject in the area of social assistance, where billions of dollars are spent annually, with little evidence that it is helping to get benefits recipients into sustainable work.

We waded into this with an understanding of governance and accountability models in general but specific solutions for the social services sector.

What followed was an iterative, Socratic discussion of options, relative pro’s and con’s, which lead us to something that would be a marked improvement on the current model, even if it wasn’t an ultimate solution.

That new accountability model was based on cross-sector, cross-jurisdiction research and analysis of what works and what doesn’t and the related implementation plan and recommendations were taken forward for Ministerial review and approval.

Governance Model

Governance is most often talked about in the context of corporate boards, but it is as important in the context of strategic partnerships, franchising, licensing or alternative service delivery arrangements. Here, too, there is the question of aligning interests between the principal and its agent, but also something more– the need for a mechanism to make decisions from all parties in a relationships.

For several clients who were in this situation, we designed or modified business processes, defined new policies, roles and responsibilities and a governance model to support operations, relationship management and decision-making, among other activities. Some of these organizations needed an entirely new organization structure, which we helped to design and implement, including providing on-going coaching to key managers.

The processes were often customized depending, for instance, on the need to focus on privacy in a healthcare environment or on regulatory compliance in a financial one. Similarly, the governance structures were built around multiple tiers, depending on the need for direct operational oversight / monitoring and strategic decision-making.

Starting up

When the world’s largest telecommunications company formed a joint venture with a leading European media company, we were there to help then set-up digital operations. Specifically, this new entity was created to deliver content to a variety of devices, including mobile phones, televisions and the web.

This was the heyday of dot.coms and we, like everyone else, thought we were changing the world. Alas, we were barely changing Internet content delivery! Nevertheless, it was an opportunity to design entirely new processes to ensure that content flowed seamlessly through both manual and automatic channels, from a range of partners including the UK’s Met Office to a provider of club listings, to consumers across Europe. We helped to launch operations in the UK and developed the model for rolling out similar services to France and beyond.

Operational / Program Review

Many organizations set out to do ambitious things but are then faced with the reality of not being able to muster the right resources, not all of which may be under their control. They fail to achieve their mission and their shareholders and customers feel disappointed.

This was the case with a government health agency that was mandated to create the infrastructure for electronic health records. The government commissioned an independent review of the agency’s operations, from strategy and operations to human resources, finance and technology. The comprehensive review identified a number of significant issues that were preventing the organization from fulfilling its mandate– including broken processes, unresolved operational issues and a lack of strategic direction.

The final report outlined a number of recommendations, including the establishment of better program management, development of a multi-year strategy and accountability agreements to improve the agency’s credibility.

Sourcing Strategy

This organization was approaching the end of a multi-billion dollar agreement for a suite of services from facilities management, billing and customer service to finance, human resources, marketing and technology. While some aspects of the existing arrangement were working well, others were not. Savings had not been consistently achieved, and the expected degree of innovation and service level improvement did not materialize across the board.

Management decided that a newer-term strategy was needed. However, that entailed a re-assessment of both quantitative and qualitative factors and a determination of the organization’s core competencies.

A comprehensive analysis and business case provided a road map to the future, which suggested a multi-vendor strategy combined with repatriation of some services for internal delivery. The result was a more flexible model and greater value for money.

Procurement

Public-private partnerships are one of those things that stir up ideological fervour. The debate is often between those that believe the private sector can do this better, at lower risk and those who believe that the risk and other premiums are not worth the price. While we didn’t exactly settle this argument, we did help our clients structure the best deal possible once a decision had been made to use a P3 approach.

That help included developing a financial model to evaluate options and competitive bids, devising a mechanism to pay for the contracted services and identifying appropriate service levels and a related performance framework for ensuring accountability. We worked with a range of other advisers and staff, including legal counsel, technology experts and finance and procurement teams through a two stage RFx process, confidential meetings, evaluation and selection.

While the outcomes of such partnerships are not always predictable, their probability of success can often be predicted based on the relationship between the partners.

Requests for Proposals

As consultants we have pulled our share of all-nighters writing proposals in response to Requests for Qualification or Proposals (RFQs and RFPs). It was often tempting to simply cut and paste from old proposals that seemed to fit the bill rather than writing or indeed thinking from scratch. But over time it became evident that this was a recipe for failure because clients could easily tell who cared and who didn’t.

We now use those lessons to help clients– including professional service / consulting firms– craft more original proposals that are also more likely to be winning ones. Here, too, we bring more than good writing skills– we bring our experience as both management consultants and procurement advisors. Business knowledge combined with insights into how evaluations are done (based on helping clients design RFPs) is a powerful combination and one that has proven effective for both our clients in both the professional services and other sectors.

Regulated Markets

Regulatory submissions are complex documents numbering in the hundreds of pages and chock-full of detailed technical drawings and legalese. This doesn’t take away from the fact that they still need to be effective communication tools. So, when a consortium comprising private equity and major North American energy companies sought to apply for a license to finance, build and operate a significant transmission line, they needed someone to help tell their story.

In this situations we find that our own business and technical backgrounds and the fact that we have submitted our own proposals, offers a distinct advantage. Not only can we follow the technical jargon of engineers, but we can also turn it into something that is more emotionally charged and captivating than your run-of-the-mill license application.

We were able to bring a range of capabilities to complete a very complex submission within a tight time-line. Our skills in project management, business, writing and editing were all essential to meeting the client’s needs and for telling a compelling story.