Introductory Booklet External Service Delivery - Our Public Service 2020
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External Service Delivery
Introductory Booklet
Your introductory guide to
External Service Delivery in the
Irish Public Service
FIRST EDITION
May 2014Foreword by Mr Robert
Watt, Secretary General,
DPER
Pragmatically, Government successful ESD delivery. These
organisations should enlist key principles include driving
external providers when the value for money in the public
benefits outweigh the costs of service and delivering best in
doing so, bearing in mind the class services for citizens by
quality of service, effectiveness making the best use of
and the public interest. resources. We must also aim
to foster continuous
There are a wide range of improvement through
The difficult economic situation Government activities that are innovation, develop more
in which Ireland finds itself being successfully delivered by responsive systems and to
means we have had to radically external providers. These leverage new technologies to
re-think how we manage and include eFlow and the bovine successfully delivery services
deliver our public services. traceability system. Many externally.
External Service Delivery (ESD) departments and agencies
is one area of reform that can across the public service have I hope that you will find this
potentially deliver a range of facilities management, IT introductory booklet a useful
benefits in the provision of services, inspections, document aid for increasing your
public services. These include management, printing and legal awareness of the potential of
financial savings arising from services delivered externally. ESD Projects in your
enhanced management These initiatives have organisation. It is my ambition
practices and performance demonstrated that external that the links we are building
measurement. There can also service delivery can deliver with industry will ultimately
be greater potential for excellent outcomes for all lead to a culture of
innovation through access to a participants, including the state collaborative partnership
wider set of skills, knowledge and the citizen. between the public and private
and technologies. Delivering sectors in which the best of
services externally also Successfully managing ESD of both sectors can come together
provides an opportunity for any public service is a complex to deliver the cost effective,
greater focus of scarce process. We must increase the high quality, innovative public
resources on core activities. capacity and capability of public services the people of our
servants to understand, and country deserve.
implement the Key Principles ofAbout this Introductory Booklet
Consultants and Other
Who is this External Support by the
What are your
Introductory Civil Service (and other first steps?
national guidelines);
Booklet for? If you are considering an
Relevant EU Public External Service Delivery
This introductory booklet is for Procurement Law; and, project, you could think about
distribution within the Public the following steps:
Service to provide a Public Procurement
background and introduction Guidelines - competitive Step 1: You should familiarise
to External Service Delivery process. yourself with relevant on-line
(ESD). information (this can be found
on the ESD portal on the
Note to Reader Government network and
What is it Government websites).
This document is issued by the
about? Department of Public Step 2: You should contact the
Expenditure and Reform ESD unit in the Department of
This Introductory booklet is Public Expenditure and
(DPER) to provide introductory
designed to provide high level Reform. They can provide
information for those
introduction to External expertise around the various
managers considering an ESD
Service Delivery and the types of external service
project. It is an introductory
framework used to identify delivery and explain how to
high level document and is not
and assess potential services start the process.
an exhaustive interpretation in
for ESD.
relation to any legal provisions
governing public procurement Step 3: Attend the two day
or contracts. Additional advice training programme ‘An
How you may be sought from DPER. Introduction to External
Legal or other professional Service Delivery’ that is co-
should use it advice should be obtained ordinated by the Reform and
about the interpretation of Delivery Office. For further
This is an introduction information on these courses
legal provisions or the correct
document that should be read please click here.
application of such provision.
by ESD Managers prior to
considering any detailed ESD Step 4: Follow the phased ESD
This is a living document and
analysis. For those considering process outlined in the ESD
will be updated regularly as
embarking on an ESD project handbook.
relevant sections of law
the ESD Handbook (a more
change. Please ensure you are
detailed document) should be
working on the most recent
read. The ESD handbook
version by checking on our
should be read in conjunction
portal where the most recent
with;
version will always be saved.
The Guidelines in the
Engagement ofIntroductory Booklet Contents About this Introductory Booklet .................................................................................................. i A. What is External Service Delivery?.......................................................................................... 1 B. Benefits Realisation................................................................................................................. 3 C. The ESD Framework ................................................................................................................ 5 D. ESD Phase Roadmap ............................................................................................................... 7 E. Phase Roadmap Guide ............................................................................................................ 9 F. The Exit Strategy .................................................................................................................... 10 The NRA Case Study .................................................................................................................. 12 The National Roads Authority (NRA)......................................................................................... 13 NRA Case Study – The Assess Phase ......................................................................................... 14 NRA Case Study – The Prepare Phase ....................................................................................... 16 NRA Case Study – The Evaluate Phase ...................................................................................... 18 NRA Case Study – The Commit Phase ....................................................................................... 19 NRA Case Study – The Transition Phase.................................................................................... 20 NRA Case Study – The Optimise Phase ..................................................................................... 21 Irish Public Service ESD Examples ............................................................................................. 22 Conclusion & Reference Sites.................................................................................................... 23
Overview
A. What is External Service Delivery?
ESD is the contracting out of a of non-government service ESD provides a framework to
business process or activity, provision through ESD. help determine how and by
which an organisation may ESD has a number of key whom programmes and
have previously performed benefits, including cost services should be delivered.
internally or has a new need efficiency. Among the other
for, to an independent benefits of ESD are: ESD covers many
organisation from which the organisational arrangements
process is purchased back as a Better services to the end that span a broad spectrum of
service. user, delivery arrangements for
Reduced pressure on local public services.
As governments' experience management,
and capacity to regulate The ability to flex in time of The following table outlines
private sector providers have increased demand, some of the ways that ESD can
improved and the private Improved services; and be implemented for the public
sector is becoming more Improved access to new sector depending on the
willing to supply public operating models, context and nature of the
infrastructure and services, management practices and service.
governments have become technologies.
increasingly prepared to
contemplate innovative forms
ESD is not just about achieving cost efficiency; other benefits include service
improvement, reduced management overhead and flexible resourcing.
Term Definition Example
1Toll road
Public-Private ventures or partnerships designed to deliver
Partnerships / Mixed management; and
infrastructure and/or services which are funded and
Ventures / Joint other public private
operated through a partnership of government and one or
Ventures partnership
more private sector companies.
schemes.
Public entities purchase services under contract from private Contract catering or
Contracting Out
firms, but retain accountability for the service. cleaning services.
For franchising, the government confers to a private firm the
right or privilege to sell a product or service in accordance
Franchising/ with prescribed terms and conditions. For licensing, the Mobile operators /
Licencing government grants a license to a private firm to sell a radio licences.
product or service that unlicensed firms are not allowed to
sell.
A public service mutual is an organisation which has left the
A pension’s
Public Service (also known as ‘spinning out’) but continues to
administration joint
deliver public services. Mutuals are organisations in which
venture partnership
Mutuals / Employee employee control plays a significant role in their operation.
between employee
Takeovers They are a newer form of contracting out that involves
partners, UK
contracting with a former government employee, or
Government and
employees, to deliver a service previously delivered directly
Paymaster.
by the government.
This Introductory booklet These are only suggestions and it can be difficult to secure the
focuses primarily on the not an exhaustive list. necessary co-operation
Contracting Out model as it is between providers or providers
the most common form of ESD. Areas should only be and in-house provision. Where
Examples of activities that may considered for ESD once they services have uncertain
provide opportunities for ESD have a clear strategy for demand or are characterised by
include catering; facilities mitigating risk. This is especially high policy uncertainty,
management; property important where it is difficult to departments may find it hard
management; security services; measure the value added by a to re-negotiate contracts. If you
debt management; customer potential supplier. In this are proceeding to ESD, it is
contact/call centre; ICT instance it is challenging to probable that mitigating
infrastructure and ICT support; price contracts and to monitor against the above scenarios
payments/grants performance. Furthermore in may involve additional costs
administration; recruitment; areas where a service outcome which you should budget for.
licensing; training and is highly dependent on the
courier/transport services. performance of other services
2Overview
B. Benefits Realisation
The following pages look at
How important were each of these objectives
some of the experiences in your most recent ESD initiative?
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 and also to improve overall that the initial scoping and
initiative but that there are controls. assessment phase is critical to
more drivers to ESD than just the overall success of an ESD
cost reduction. When asked about customer initiative.
satisfaction with external
The survey show that service delivery the 2012 One key piece of feedback from
improving customer service Deloitte Global survey revealed the survey is that ESD is more
and leveraging new that most respondents (76%) than a third-party contractual
technologies ranked nearly as are either extremely satisfied arrangement. It is a key
highly as reducing costs in or satisfied with their most business relationship.
terms of the important recent ESD initiatives. Therefore assessment and
objectives of an ESD initiative. Underestimating scope is the preparation to ensure a
The survey also reveals that most often reported problem thorough understanding of the
another key objective of ESD with most recent ESD supply market is key to success.
initiatives is the ability to allow initiatives, followed by
a more flexible HR model to suppliers being unable to meet
flex in times of greater demand service levels. This illustrates
3How satisfied are you with the outcome of your What factors led you to be less than satisfied with
most recent ESD initiative? your most recent ESD initiative?
Source: 2012 Deloitte ESD Survey
4Overview
C. 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.
Value
External Service Delivery
Assess Prepare
People & Organisation
Location & Asset Management
Optimise Evaluate
Information Technology
Change Management
Transition Commit
Programme & Risk Management
Phase 1 - Assess understood view of the likely
benefits, costs and risks of the
It is in the Assess Phase that the Phase 2 - Prepare
ESD initiative and of the
early high level unknowns must
activities required to The Prepare Phase
be flushed out and confronted.
respectively maximise, encompasses a thorough
The activities in this phase are
minimise and mitigate these. A examination of the market and
critical to establishing senior
Business Case (1) analysing a supplier base and the
stakeholder expectations, both
range of possible delivery preparation of detailed
for the ESD initiative as a whole
options must be produced at requirements to be included in
and for the amount of time and
this stage. Financial analysis the Request for Tender( RFT)
effort required to secure it. By
metrics (2) must also be and contract. This analysis will
the end of the Assess Phase
completed. also identify the procurement
there will be a commonly
5procedure most suited to the activities across the ESD Transition Phase has been
specific circumstances of the initiative, supplier completed. Within this phase
ESD project. Qualification and management, people and public entities need to focus on
award criteria for evaluating organisation work streams. The managing the supplier
tenders need to be developed contract is finalised. Significant relationship, monitoring
and all key service delivery internal stakeholder contractual obligations as well
elements; costing issues and management activities are as tracking the supplier
contractual terms must be required to secure the buy-in performance against the
identified. During this phase and sign-off necessary to original business case.
the fundamental elements of complete the ESD initiative. In
the remaining phases of the parallel, the organisation By its very nature, the Optimise
lifecycle are also defined and design will be finalised and Phase is very much an
agreed. This is often the most transition roadmap and plans operational responsibility
resource intensive and (3) developed. Start thinking which continues throughout
commercially significant phase about ESD (see below) now. the duration of the contract
of the ESD lifecycle. until the contract renewal or
exit.
Phase 5 – Transition
Phase 3 – Evaluate
The Transition Phase of the ESD
The Exit Strategy
The activities within this phase lifecycle focuses on
are broadly aligned to three transitioning the work and The Exit Strategy offers
steps that cover: 1.The resources (infrastructure and guidelines for preparations to
management of the suppliers responsibility) to the successful exit an ESD contract and
whilst they are preparing their tenderer(s) and effective making arrangements for
tenders; 2. Evaluation of the stakeholder management to handover to a new incoming
tenders and 3 Notification to ensure effective contract supplier. It is very important for
unsuccessful tenderers. management and optimised the public entity to have
Following completion of the value. The phase includes effective exit arrangements in
Evaluate Phase, the public implementing a robust place if the ESD contract fails or
entity will be ready to proceed transition plan with the the relationship between the
to contract. The sequence of supplier(s) and establishing a public entity and the supplier
activities within this phase will reporting mechanism to track breaks down. The original ESD
be dependent on the value. contract should contain an Exit
procurement procedure provisions that allow for
followed. limited, legally permitted
Phase 6 – Optimise renegotiation or termination of
Phase 4 – Commit a contract by either party.
The Optimise Phase of the ESD
The Commit Phase includes the lifecycle focuses on the steady-
final pre-contract stages of state operation of the ESD
both internal and external arrangement after the
6D. ESD Phase Roadmap
The ESD phase framework is a guidance in respect of three More information on the Stage
comprehensive tool used to critical functional areas Gate Process can be found
guide the process of namely; Phase Activities, overleaf.
transitioning to an ESD model. Programme Management
The framework provides Office Activities and Outcomes.
1. Assess 2. Prepare 3. Evaluate 4. Commit 5. Transition 6. Optimise
Phase Activities
1.1 - Complete 2.1 - Prepare ESD 3.1 - Confirm 4.1 - Reassess 5.1 - Monitor 6.1 - Assess Value
Initial ESD Scope & ‘To Be’ Structure Value Proposition Value Leakage & Track
Assessment Process Alignment Proposition Benefits
4.2 - Select
1.2 - Develop 2.2 - Determine 3.2 - Manage Supplier & Sign 5.2 - Develop 6.2 - Manage
Baseline & Delivery Structure Supplier Contract Transition Plan Continuous
Preliminary Interaction Improvement
Business Case 2.3 - Define 4.3 - Clarify 5.3 - Develop &
Operating Model 3.3 - Develop Contract Details Manage Process 6.3 - Prepare
1.3 - Scope Initial Plan for with Successful Guide Future Strategy
Transition & 2.4 - Develop ESD Transition supplier
Assess ‘As Is’ Pricing Model 5.4 - Monitor 6.4 - Manage
Process 3.4 - Evaluate 4.4 - Manage Supplier Commercial
2.5 - Prepare for Proposed Stakeholders: Transition Obligations
1.4 - Determine Supplier Selection Service Executive Buy-in
& Agree ESD Locations & Approval to 5.5 - Manage 6.5 - Optimise
Transition 2.6 - Define Sign-off Workforce Supplier
Principles Services & 3.5 - Manage Considerations Relationship
Develop Evaluation 4.5 - Finalise
1.5 - Identify, Specifications Activities Retained Org. 5.6 - Shift 6.6 - Manage On-
Assess & Structure Responsibilities going Demand
Manage Risks 2.7 - Prepare RFT to Supplier
4.6 - Manage Organisations 6.7 - Manage
1.6 - Assess ESD 2.8 - Prepare Security & Change
Options Stakeholders for Control 5.7 - Manage
ESD Transition the Transition
1.7 - Assess 4.7 - Manage
Location & 2.9 - Define Communications
Estate Retained & ‘To & Align Work
Considerations Be’ Org. Structure Streams
Programme Management Office Activities
Mobilisation, Project Governance & Risk Management
Assess Phase Prepare Phase Evaluate Phase Commit Phase Transition Phase Optimise Phase
Stage Gate Stage Gate Stage Gate Stage Gate Stage Gate Stage Gate
Outcomes
‘As Is’ Model & Detailed ‘To Be’ Initial Analysis ESD Agreement Implemented Active Monitoring
Baseline Model and ESD of Proposals & Transition Plan
Requirements Audit Trail Retained Org. & Retained Org. End of Term &
Preliminary Structure, Structure Draft Future
Business Case, Agreed RFT Preferred Transition Plan & Strategy
ESD Scope & Criteria and Supplier Value Delivery Relationship
ESD Options Documentation Shortlist Roadmap with Supplier
7Stage 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
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
Gate One At end of Assess Phase 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.
This Stage Gate ensures that essential preparations in
relation to market/supplier assessment and key service
Gate Two At end of Prepare Phase delivery elements have been undertaken. The review also
makes sure that the RFT procedure and criteria have been
appropriately determined.
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
Gate Three At end of Evaluate Phase
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.
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
Gate Four At end of Commit Phase
have been clarified, that value delivery has been assessed
and that a design has been finalised for the Retained
Organisation Structure.
The fifth Stage Gate examines whether services and process
have been successfully transitioned to the supplier. The
Gate Five At end of Transition Phase 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.
This Stage Gate evaluates whether the ESD project has
successfully implemented and that there is continuous
Gate Six At end of Optimise Phase monitoring of all aspects of the ESD project. The Review
also examines if the benefits forecasted in the Business
Case have been achieved.
When the Stage Gate Process ends, the SRO is sent a draft
report. The SRO then has a specified period of time in which
Final Report 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.
8E. Phase Roadmap Guide
activity planning, end of each phase is
Phase stakeholder the Stage Gate Process.
Activities engagement and This activity involves
communication assessing the work
The phase activities as planning activities. completed as a result of
outlined on the phase the undertakings during
roadmap detail the specific
Project Governance the respective phase
activities to be completed At the outset of an ESD and benchmarking the
during each phase of the transition is it vital to outcomes achieved
ESD Framework. Successful determine and agree with targets, objectives
completion of each phase governance and industry best
requires careful arrangements. These practice. If the work
consideration of each arrangements will completed does not
activity in addition to the determine how the meet specific
consideration of transition is managed requirements it should
Programme Management and must be reassessed not be signed off by
Office Activities, Outcomes at the beginning of senior management
and a number of Transition each phase and and therefore the
Principles. throughout the transition project will
transition. not pass through the
Stage Gate to the next
Programme Risk Management phase.
Management Proactive and thorough For more information
risk identification, about the Stage Gate
Office assessment and
Process, see the previous
management is crucial
Activities for the success of an
page. For more
ESD transition. Specific
information on
The Programme Programme Management
risk management
Management Office (PMO) Activities please click link.
activities have been
Activities as outlined in the
aligned to certain
phase roadmap provide an
overview of the various
phases throughout the Outcomes
ESD framework.
PMO activities that should
However, it is vital to The phase roadmap
be considered during an
note that careful diagram outlines the
ESD transition, namely;
consideration must be specific outcomes to be
given to risk achieved as a result of the
Mobilisation management activities completed in each
At the outset of each throughout the phase. Successful
phase it is vital to transition process. achievement of these
mobilise the outcomes is a prerequisite
engagement team. This Stage Gate Process for the beginning of the
process incorporates The final PMO activity next phase of the transition.
the initial resource and to be undertaken at the
9F. The Exit Strategy
The Exit Strategy offers transition smoothly between The relationship breaks
guidelines for preparations to suppliers and solutions, reduce down.
exit an ESD contract and risks and keep costs to a Services not delivered as
making arrangements for minimum. While it is initially expected.
handover to a new incoming hoped that the ESD project will Fraud or criminal
supplier. It is very important be a success, the ESD contract behaviour.
for the public entity to have might not come to a Bankruptcy.
effective exit arrangements in conclusion for various reasons.
place that guarantee the These may include:
organisation is able to
Key Exit Strategy Points to Remember
Exit Agreement Business Case Legal routes
The original ESD contract A Business Case will need to be You should also be aware of
should contain a stage based prepared outlining the benefits and plan for the options
Exit Agreement with clauses against the risks of ending the available to you should you
that allow for termination of ESD relationship. wish to go down a legal route.
the contract by either party.
Management of Exit procedures
Exit management team resources Correct exit procedures should
You should establish a team to You will need to make sure be established within your
manage the end of the resources are being managed organisation and provision for
contractual arrangement and to ensure the continuance of this should be placed in the
any new handover process. service provision during the original ESD contract.
exit/handover period.
Outline of Exit Strategy Stages in the Exit Agreement
Initial Stage of processes or licences from the incoming supplier. You will
Exit/Transition outgoing supplier to your need to identify what roles and
The initial stage of the organisation. processes the new supplier will
exit/transition will involve have responsibility for. You
preparations to begin finalising may also need to help the
Middle Stage of outgoing and incoming
details with the outgoing
Exit/Transition suppliers agree on transfer
supplier. Actions may include;
confirming any work the related agreements.
During the middle stage of the
outgoing supplier must exit/transition you will start to
complete, managing any plan working and handover
identified risks and planning arrangement with the new
for the transfer of services,
10Final Stage of Exit supplier concerning which termination related costs and
Transition services are finishing and how oversee final agreements
all objectives are to be met. between the outgoing and
The final stage of the You may have to confirm incoming suppliers.
exit/transition will involve final timelines for the termination
arrangements with outgoing of services; agree any
Service Closure/Exit of Outgoing Supplier
You will need to ensure there your organisation will need to place. The outgoing supplier
is no disruption to services as stop and the transfer of any should finish providing services
the outgoing supplier exits required data to the incoming and vacate your organisation’s
your organisation. Access to supplier will need to take premises.
11The NRA Case Study 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 is outlined over the next few pages of this booklet. 12
Case Study
The National Roads Authority (NRA)
In January 2006 the implemented. While the To procure and oversee a world
Government announced that as project was on time and class barrier-free tolling
part of the planned upgrade of delivered to budget there were operation on the M50
the M50 Motorway, the nevertheless a myriad of Motorway which is
existing toll arrangements on technical and operational commercially focussed,
the motorway at the West-Link issues to be addressed during financially efficient and results
Toll Bridge would be replaced the Mobilisation Phase (just in a positive experience for all
by a barrier-free tolling system after ‘go-live’) which resulted in customers using the Motorway.
during 2008. significant levels of customer
frustration, a large backlog of
The eFlow business has
customer contact to manage
Barrier-free tolling, as the name changed completely from those
and widespread negative media
suggests, enables the collection difficult early days. The
attention.
of tolls solely by electronic business has gone from
means without any barriers or strength to strength in terms of
toll-plaza on the motorway – About two months after the customer numbers and
and therefore no need for launch, the NRA recognised revenues and is now
motorists using the motorway that the operation was simply internationally recognised as an
to stop or slow down to pay the not performing adequately excellent customer service
toll charge. While tolling by across a number of critical business. So much so that
means of barrier-operated areas of the business (e.g. eFlow “swept the boards” at
plazas is a long established customer management and the Contact Centre World
practice in many countries, the collections). As a consequence Awards 2011 in London for the
M50 system was one of the the delivery team had to take a EMEA region by achieving
first fully electronic tolling step back and reconsider the seven awards including three
systems to be deployed on a objectives and approach to the gold medals in categories such
European motorway and as new business in order to as customer service, training,
such there was relatively little determine and implement a and IT/innovation. eFlow also
industry experience on which revised strategy to stabilise the received a Public Sector
to draw upon when business and to create the right Excellence Award from An
establishing this new business. platform from which it would Taoiseach in 2011 and was also
develop and improve going awarded the Outsource
forward. Partnership of the Year for
The new barrier-free system
2012 at the Irish Contact Centre
called eFlow (which is a
& Shared Services Awards.
registered business name of One of the first things the team
the NRA) was ‘switched on’ did following this, and perhaps
during August 2008. It is fair to one of the most critical, was to
say that the delivery of the work out a simple mission
M50 eFlow project and the statement for the business,
creation of a new public sector which was as follows:
tolling business was possibly
one of the most challenging
projects that the NRA has ever
13NRA Case Study – The Assess Phase
An Environmental Impact contract and comply with Department of Transport as the
Statement (EIS) was prepared procurement regulations. NRA’s sponsoring department
for the M50 Upgrade Scheme Furthermore, it was identified as well as the Driver Vehicle
identifying the West-Link toll that it would be difficult to Computer Services Division
facility as a contributing factor demonstrate ‘value for money’ (formally the Vehicle
to delays experienced by road from a negotiated agreement. Registration Unit) based in
users on the M50. The EIS Shannon as manager of the
presented the case that a National Vehicle Owner
The NRA, with the agreement
barrier-free tolling system Register which is used by the
of the Government, took the
would unlock significant tolling system to identify all
decision to “buy-out” the NTR
additional benefits for users vehicles registered in the State,
West-Link contract and to run a
and the environment than the Data Protection
tender competition to appoint
would otherwise have been the Commissioner with regard to
an entity to design, build and
case with a conventional plaza protection of road users privacy
operate a new barrier-free
tolling. In particular, the EIS across a number of areas and
tolling system.
identified that the proposals the Courts Service with regard
would increase the capacity of to the enforcement process
the Motorway, enabling road ESD was the optimum solution and plan for the treatment of
users including buses, taxis, as this was the first project of toll evaders / violators. The
commercial vehicles and this nature in Europe for a NRA also had to engage with
private cars to benefit from number of reasons including private sector industry bodies
significantly reduced traffic the fact that there was a lack of including, for example, the Car
congestion and increased resources, skills, and Rental Council and the Vehicle
average traffic speeds both on experience within the NRA to Leasing Association of Ireland.
the M50 and also on the radial fully resource such an
routes approaching the M50. operation. Additionally, the
Ascertaining the list of services
The replacement and upgrade new operation was required to
that could be provided by ESD:
of the tolling system was work “at full steam” from the
first day as there was no ‘ramp The tolling system and
therefore a critical element of
up’ phase. Furthermore, as the services were procured
the overall M50 Upgrade
motorists would directly using a design, build and
Scheme.
interact with the new operate contract with an
technology the impact/results eight year term (and with a
The NRA engaged with the three year extension
of the project would be highly
incumbent toll operator, NTR option).
visible.
(who had contractual rights to
collect tolls on the “Westlink”
Engaging and managing The NRA, in March 2007,
(Junction 6 to Junction 7)
stakeholders: appointed BetEire Flow (a
section of the M50 until 2020),
French consortium of two
to explore the possibility of The introduction of barrier-free
major French firms - Sanef
varying the West-Link contract tolling required the support
and CS), to design, build
arrangements to change the and cooperation of a number of
and operate the tolling
tolling arrangements to barrier- key stakeholders and
system. Sanef manage the
free tolling. The NRA ultimately establishment and
tolling business along with
concluded that it was not management of good working
their key partners/
feasible to negotiate such relationships. This included the
suppliers:
changes to the West-Link
141. Customer Management – new type (“first generation”) of The benefits from barrier-free
Abtran. electronic road pricing on the tolling on the M50 were
2. Payments & Billings – busiest motorway in the State broadly summarised as follows:
Payzone. presented challenges which
included:
3. Logistics – Realtime Less congestion - no
Technologies. stopping or slowing down
4. Post – PrintPost. Concluding an agreement at a toll plaza.
for the termination of the Faster journey times –
5. Enforcement – Pierse &
NTR West-Link toll increased average speeds.
Fitzgibbon Solicitors.
concession.
Less land take.
Preparing supporting
This contract is much more Less pollution.
legislation for barrier-free
than providing a service to the Better air quality.
tolling including a new Toll
NRA – it is really about
Scheme and Bye-Laws.
managing the tolling business
Engaging with a broad The advantages of barrier-free
on the NRA’s behalf.
range of stakeholders. tolling are offset somewhat by
risks related to the potential for
Migrating ‘on the ground’
Challenges, benefits and risks: increased levels of revenue
from the barrier operated
In preparing and planning for leakage with free-flow systems,
toll facility to barrier-free
the introduction of the new additional risks associated with
motorway tolling.
barrier-free tolling system the the introduction of new
Embarking on a nationwide
NRA team were aware that the technology and the uncertainty
public awareness campaign
project entailed certain surrounding operating costs -
on the new tolling
characteristics and risks which as there is very little historical
arrangements including
would make it one of the more cost data available on the new
the launch of the eFlow
challenging projects delivered technology for road operators
tag.
by the NRA in recent times. and infrastructure managers.
Launching the operation of a
15NRA Case Study – The Prepare Phase
Market assessment of free tolling regions specific Milestone 1 - Approval of
suppliers: legislation was required to Specification and
The NRA hired external enforce and penalise violators Implementation Plan.
consultants to carry out a and also to act as a deterrent. Milestone 2 - Approval of
Global Best Practice Study to Testing Programme and
identify an initial list of Identifying Scoring and Operations Plan.
potential ESD suppliers, Evaluation Criteria: Milestone 3 - Completion
determine the feasibility of of Construction &
The NRA adhered to Public
implementing a barrier-free Performance Tests.
Sector Procurement guidelines
tolling system, identify best
throughout the supplier Milestone 4 - Trial
practices and highlight any
evaluation selection process. Operation Period.
potential risks and challenges in
Price and quality were Milestone 5 - Provisional
the current market place.
identified as the key criteria in Operating Permit – “Go
The main challenge was to supplier selection prior to Live”.
launch the operation of a new advertising the tender.
Milestone 6 - Final
type (“first generation”) of
Operating Permit.
electronic road pricing on the
Contract Preparation:
busiest motorway in the State
and successfully collect tolls The contract to design, The contract also required the
from up to 100,000 vehicles construct and supply the new new Tolling Operator to
from the first day of operations tolling system was awarded to operate and maintain the new
and over 1,400,000 individual BetEire Flow (a French system for a further 8 years.
vehicles within the first six consortium of two major
In addition to the procurement
months. French firms - Sanef and CS) in
of the tolling system, there
March 2007 following a
were a number of other
competitive procurement
Strengthening Legislation: supporting services which the
competition.
NRA procured to assist during
The NRA engaged with the
the mobilisation and
Department of Transport in
The initial draft contract was implementation phase of the
relation to strengthening the
prepared between the Project eFlow project including for
legislation necessary for
and Legal teams prior to example, the appointment of
barrier-free tolling. The
advertising the tender as per an Enforcement Service
enactment of appropriate
Public Sector Procurement Provider as well as the
supporting legislation which
guidelines. Service Level appointment of technical
allowed the use of video
Agreements were drafted as advisers with specific tolling
evidence and action against a
part of the contract at this technology expertise and
toll evader / violator through
point. electronic payment security
the use of the national vehicle
Contract Preparation expertise, as well as legal
register was / is a critical
(Continued): advisers and financial advisers.
element to the operation to
There was little change made
address potential leakage of
to the terms and conditions of
toll revenue. The contract specified a
the contract once the tender
The Global Best Practice Study number of important payment
had been advertised to the
commissioned by the NRA based milestones for the initial
market place.
during the assessment stages delivery of the system as
highlighted that in all barrier- summarised below:
16Supplier Management: ability to gain more clarity. In financial capacity to undertake
Once the NRA had agreed the addition, this procedure also the work (e.g. to demonstrate
scope of the services to be allowed the NRA to issue that they were financially
performed by the supplier and clarification circulars with viable).
had drafted the initial terms additional information if The evaluation team reviewed
and conditions of the contract, required including, for the suppliers who responded to
the Expression of Interest (EOI) example, clarifying certain the EOI and then prepared a
was advertised on eTenders aspects of the scope which may shortlist of suppliers based on
and in the European Journal. have been confusingly phrased. ranking the responses against
There was a procedure for the Suppliers were asked to pre-determined criteria. The
suppliers to ask for clarification provide evidence of their NRA then issued the RFT to the
on aspects of the tender which experience, performance and top five ranked suppliers.
benefited both the supplier and technical capability and to
the NRA as the supplier had the demonstrate they had the
17NRA Case Study – The Evaluate
Phase
Supplier Management: Evaluation of Supplier general market knowledge.
In the Prepare Phase the Responses: The NRA followed set
evaluation team reviewed As part of the Expression of procedures in managing the
the suppliers who responded Interest (discussed in the supplier applications e.g. in
to the EOI and developed a Prepare section of the terms of late applications or
shortlist of suppliers to Introductory booklet) the if a supplier declined the
receive the RFT. NRA prepared a short-list of project. All evaluation and
suppliers – all of whom had selection criteria were
to satisfy minimum carefully documented for
The NRA managed suppliers audit purposes and all
requirements in terms of
through the proposal
having the necessary procurement documentation
process. There was a facility
technical capacity (e.g. was checked by the NRA
for suppliers to ask questions
experience) and financial legal advisers in advance of
and suppliers could also
capacity to perform the the procurement
indicate whether they
services required. For the competition to ensure it was
considered that some of
evaluation of the RFT, the fully compliant with
their questions were
NRA established an procurement law.
commercially confidential.
evaluation methodology to External consultants were
The NRA reviewed all these
assess the responses based asked to provide assistance
questions and responded to
on a combination of scoring and opinions in the
all suppliers. Where a
the responses for both price evaluation and selection
supplier had requested for a
and quality. process however the NRA
question to be considered as
Once the responses were had final judgement in the
commercially confidential
returned to the NRA the evaluation process.
the NRA team had to take a
view and possibly respond evaluation team reviewed
directly to the individual the applications and scored Supplier Selection:
supplier. Where the NRA them against these
The contract to design,
determined that the query predetermined criteria (and
construct and supply the new
was not commercially any sub-criteria). Careful
tolling system was awarded
confidential the supplier was consideration was taken to
to BetEire Flow (a French
given the opportunity to ensure that submissions
consortium of two major
withdraw the query rather were scored and evaluated
French firms - Sanef and CS)
than have it answered and based on the written
in March 2007 following a
issued to all suppliers. application and evidence /
competitive procurement
Generally the NRA team commitment provided as
competition.
would issue responses to part of the response rather
queries on a weekly basis. than being influenced by
18NRA Case Study – The Commit Phase
Signing the Contract:
Manage their customer Focus on strategic goals –
In line with Public Sector base and provide excellent be aligned to the Irish and
Procurement Guidelines, there services to their customer European tolling sectors.
was no scope for renegotiating base (circa two million
contract terms and conditions people).
The NRA’s Role and
at this point as the terms and
Collect revenues and Responsibilities:
conditions of the contract
account for over €100
were developed prior to
million tolling revenue.
advertising the Tender. The The NRA need to
Manage their assets understand the business,
first supplier selected decided
including the eFlow brand set the vision and
against proceeding with the
and reputation (includes objectives, direct the
contract as they wished to
marketing and business, monitor
renegotiate certain contract
communications). performance and manage
terms and conditions at this
point and this was not Be commercially focused the relationships (and
allowable. BetEire Flow’s and deliver continuous contracts);
tender proposal was evaluated improvement for the Contract Management of
as the second best proposal customers and the the following four areas:
and they were therefore financial position (e.g.
Efficiency Savings - annual
awarded the contract. costs efficiencies).
service review.
Supplier Role and Be compliant and
Gain Sharing - consider
Responsibilities: auditable – areas such as
making provision to share
financial audits, e-
BetEire Flow (Sanef) was gains.
commerce PCI compliance
required to manage and Financial Model / Open
and Data Protection.
operate all aspects of the Book Accounting.
tolling business on behalf of
Benchmarking - service
the NRA, including to:
performance and costs.
19NRA Case Study – The Transition
Phase
Once the contract had been improvement items. As this could remain agile in
signed, Sanef began to design was a first generation project responding to them.
and build the new electronic there were a number of key Ensuring the supplier has
tolling system. This system, learnings for both partners in the necessary resources
eFlow, was ‘switched on’ the Transition Phase such as: and capabilities to deliver
during August 2008. Following Approaching the project the project and ensure
the launch of the system, with consideration for these remain in line with
Sanef were responsible for customer needs and changing project and
managing and operating all business financial needs as business goals.
aspects of the tolling business well as from an Keeping communication
on behalf of the NRA. engineering and technical lines open and the
perspective; importance of team
Supplier Management: Ensuring Sanef understood building between both
Effective supplier management the NRA’s strategy and partners.
was critical at this point of the requirements so they Balancing the level of risk
project. The NRA identified could deliver against it. between Sanef and the
issues and areas for Sharing project and NRA.
improvement and worked business goals with Sanef The importance of Brand
closely with Sanef to and regularly reviewing Management.
implement and achieve these these with Sanef so Sanef
20NRA Case Study – The Optimise
Phase
In the past four years in emphasise on maintaining a Key Success Factors:
operation the NRA have good relationship with Sanef The NRA has identified the
achieved successful results through regular informal and following key success factors
evidenced by satisfied formal communication for successful service delivery:
customers, an ever expanding procedures. Team building
customer base and strong plays a key role in maintaining Focus on delivering a
revenue growth during tough this good relationship. customer centric service
economic times. The approach efficiently and cost
of partnering and collaboration Performance Measurement: effectively.
with their suppliers in the To assess performance the Understand all
management of the business NRA required simple and stakeholders’ short,
(as opposed to adopting a relevant performance medium and long term
more conservative and measures. They introduced goals.
traditional contractual benchmarking reviews, visits Ensure delivery is
relationship with little or no and conferences with Sanef customer focussed and
innovation encouraged) has which play a role in assisting not process or technology
enabled them to introduce and the development of simple led but also understand
manage change successfully performance metrics and appreciate the part
across a number of business The following M50 KPIs were technology and process
areas and they will continue in identified: plays in success.
this manner to deliver further Ensure relationship is two
improvements across the KPI 1 – Transactional Toll way, open and honest.
business. Revenues - Revenue Ensure contractual
banked per ‘tollable’ alignment to desired
They are currently focusing on vehicle. outcomes and openly
growing the business while KPI 2 – Global Recovery acknowledge
reducing costs and continuing Rate - Total percentage of misalignment even if not
to improve compliance (i.e. transactions which have fixable in the short to
tolls paid on time). They also been paid. medium term.
aim to further improve the KPI 3 – Road Side Always share with your
customer experience by Equipment Revenue clients and stakeholders
introducing more simplicity Leakage - Transactions what matters to you.
and convenience by, for captured which could not Respect and embrace the
example, upgrading the be charged due to poor differences in cultures and
customer website so that it is Licence plate data. approach of all and use
fully accessible from all types KPI 4 – Licence Plate this to enhance the overall
of devices (e.g. laptop, tablets (ANPR) Misreads - service delivery.
I-phones). Misreads impacting
customers.
Supplier Management: KPI 5 – Payment Trends -
The NRA realise that Supplier Payment trend for
Relationship Management is unregistered domestic
key to the success of project users.
delivery and so place great
21Irish Public Service ESD Examples
become aware of the potential
Managed Business claim.
Services Process
ICT Services
An Garda Síochána - Go- Public Injuries
Safe Assessment Board An Chéim Computer
The GoSafe consortium has The Personal Injuries
Services – Collaborative
been contracted by An Garda Assessment Board facilitates
higher education
Síochána to operate safety anyone intending to seek information services
cameras on Irish roads. Go- compensation for a personal The An Chéim MIS Programme
Safe will provide 6,000 injury (other than a personal was created to implement
enforcement hours and 1,475 injury arising out of medical common management
survey hours per month across negligence), unless the claim is information systems for the
the country. The cameras will settled directly between the Institute of Technology Sector.
operate from vans which will parties. Personal injury
be marked with high visibility claimants will be better placed The implementations were
reflective material and will to avoid unnecessary legal fees carried out on a phased basis
display a safety camera following a recent move by the and lessons learned from each
symbol. Central Bank to compel phase were carried through to
insurance companies to subsequent phases.
forward information about the
Injuries Board to potential
claimants as soon as they
More Examples of Successful 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, Market Surveillance for 1) Ecodesign
Energy and Natural Resources and Labelling of energy-related
products, 2) Tyre Labelling
22Conclusion & Reference Sites
This Introductory booklet has been prepared and issued by the Department of Public Expenditure and
Reform.
The contents are designed for reference only and should not be relied upon for making ESD decisions
without reading the ESD Handbook and having further discussion with the Department or Programme
Leaders.
For more information please contact: esd@per.gov.ie
Value
External Service Delivery
Assess Prepare
People & Organisation
Location & Asset Management
Optimise Evaluate
Information Technology
Change Management
Transition Commit
Programme & Risk Management
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
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