Outsourcing Human ResourcesThe Dartford Experience

Steve Brooks, Head of Finance and Resources

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Background to Dartford Borough Council

• Smallest district council in Kent

• Population of approx 90,000

• Gross expenditure of £50m

• General fund budget of £12m – and reducing

• We do not do education or social services

• No direct service organisation

• 400 employees – and reducing

• Local pay and conditions

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HR and payroll at Dartford BC 2006/7

• HR – Manager plus 3 fte staff

• All work in civic centre as do 95% of all staff

• Gross cost £233k

• Payroll – 1 fte plus 20% of 2 other staff

• Gross cost – approx £45k

• Payroll not part of HR

• Frontier CHRIS integrated software

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Main reasons for change

• Management Team unhappy with strategic advice

• Senior managers unhappy with HR support

• Staff did not trust HR confidentiality

• Core data unreliable

• Integrated software cumbersome

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Why outsource?

• “always outsource from a position of strength”

• Nice thought but I imagine it rarely happens – not our experience

• Cost was not the main reason for change

• Payroll not considered at this stage

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Options considered

• Three companies approached

1. Small high quality HR consultancy with a few outsource clients

2. National outsource company

3. NorthgateArinso

• NorthgateArinso approached because of the work they were doing with Canterbury CC

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NorthgateArinso

• Not used NorthgateArinso before

• Fundamentally different way of providing the service• remote administration and HR consultancy support

• small on site presence

• senior and strategic support when required

• regular meetings with relevant managers

• regular briefing for managers

• ResourceLink software – My View

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Consideration of two alternatives

• Team consisting of me, one director and two senior managers

• Detailed presentations and discussions

• Visit to NorthgateArinso at Peterborough

• Demonstration of ResourceLink/MyView

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Decision and why

• Unanimous support for NorthgateArinso proposals

• Would totally change the way the HR service was provided

• The two managers had experienced off site HR support and were comfortable with it

• Two good references

• Potential saving of £50k on current costs

• Service Level Agreement

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Payroll

• When we looked further at ResourceLink/MyView it soon became apparent that this would substantially change the way we produced payroll

• I asked for a quote for outsourced payroll and Jenny Erby, Payroll Manager went to see ResourceLink and talk to payroll staff at NorthgateArinso

• Easy decision to include payroll – cost and resilience

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Initial priorities

• Transition stage until ResouceLink/MyView built

• Meet and greet sessions

• Transfer existing policies to Peterborough

• Review policies

• Produce new staff handbook

• Agree admin processes and procedures to transfer to Leeds office

• Prepare payroll for transfer

• Corporate restructure

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Initial timescale

• Started review in March 2007• Temp support from NorthgateArinso in May 2007• Decision in August 2007• Contract for HR commenced October 2007• Payroll live April 2008• MyView – online payslips live May 2008

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First impressions

• Major culture change for staff and importantly managers

• Some found it hard to adjust – “there is no one in HR”

• Further communication about Advice Line and Admin Team

• Restructure delayed implementation of initial priorities

• Trying to do too many things – set achievable objectives

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Key achievements so far

• All HR polices updated

• New comprehensive Employee Handbook

• New HR strategy

• New Competency Framework

• New Managing Attendance policy and procedure

• MyView for:

• Payslips

• Online reporting and managing of sickness

• Online request and managing of leave

• Annual saving of £60,000

NorthgateArinso have access to other expertise and services

NorthgateArinso adapt quickly and can provide additional support at short notice

Respond positively and quickly to criticism and complaints

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Teething troubles and lessons learnt

Teething troubles

• Leeds not sufficiently staffed when we went live• Delays in getting MyView correctly set up• NorthgateArinso working in silos

Lessons learnt

• Don’t try to do too much in one go• Agree up front where services will be provided from

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The future

• Contract for 5 years – ends Sept 2012, option to extend

• Can NorthgateArinso help us to reduce costs and be more efficient?

• Can we establish a joint working HR service incorporating NorthgateArinso and other authorities ?

• Training for future leaders

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Questions

Q&A