Outsourced services are not an especially new approach for the emergency services. They have been fairly prevalent across the emergency services in addressing specific service needs and functions such as payroll, pensions, telecoms and radio maintenance, managed services and, in some cases, larger scale IT/telecoms service outsourcing.
In the UK, police forces have been using the outsourced Airwave radio communications services and organisations such as Merseyside Fire, Devon and Cornwall Constabulary and the Metropolitan Police have engaged in large scale IT/telecoms outsourcing projects.
Rob Watkins, senior manager at consulting firm Analysys Mason, points out: ‘The Metropolitan Police [is] naturally the largest information communications technology services outsource deal, with a seven-year contract worth in the region of £350m that includes services such as desktop IT networks, data centres, telephony and mobile devices.’
For Watkins, that’s indicative of how the market has developed to a point where outsourcing is an acceptable approach for delivering value for money while ensuring delivery of important services. ‘The marketplace has matured over the last couple of decades in meeting the traditional needs of the emergency services through technology providers and larger systems integrators and outsourcers,’ he says.
‘However, this traditional form of outsourcing may turn into a much greater transfer of public sector staff to the private sector, with emergency service functions, and not just traditional IT services, being outsourced in the future.’
He gives the example of Lincolnshire Police. The force is currently examining the opportunity to outsource human resources, finance, information technology, legal services, estate and fleet management, strategic development and project management, general and specialist administrative support, criminal justice support and custody provision, and control room services.
‘The review to outsource these services means that outsource providers that have operated more prominently within the prison services for over a decade have the opportunity to extend their offering to the police and wider emergency services,’ adds Watkins.
The Lincolnshire outsource contract is worth up to £2bn over 10 years based on the assumption that more forces will follow the Lincolnshire model. Shortlisted suppliers include Capita Bluelight Alliance, Serco and Logica, Steria with Reliance, Northgate Information Solutions and G4S.
Those sort of large scale outsourcing deals that aim to take advantage of economies of scale by enabling several forces to share resources for non-frontline activities such as mobile device maintenance are likely to become more popular and help forces meet targets. Those targets are becoming more stringent. The Government’s Comprehensive Spending Review has announced police budget cuts of 17% over the next four years.
For that reason, says Steven Mace, head of sales in the government division at Arqiva: ‘Forces need innovative ways to increase efficiency and drive down costs. While the Coalition Government has stopped short of imposing mergers between forces and departments, it recommends that forces share facilities and services where it makes economic sense to do so. Through outsourcing, forces can share centralised call answering facilities and mission critical, 24-hour support teams.’
Martyn Hart, chairman of the National Outsourcing Association (NOA), naturally sees outsourcing growing as a consequence but doesn’t necessarily see it confined to back office functions. ‘Outsourcing will continue to grow, including actual emergency service provision such as detective work being outsourced by the police,’ he says.
‘A significant amount of wireless services have been outsourced to Airwave,’ he continues. ‘However, many emergency services have found cheaper alternatives using public network carriers for carrying out some services, mainly because Airwave’s data rates are limited. The likelihood is that the next generation of Airwave will be based on public network services, as they are in the US.’
Nevertheless, outsourcing functions such as detective work seems a long way off given that emergency services remain cautious about moving to well-established outsourced services such as communications.
‘Whatever they do, they have to involve third parties, so [emergency services] have to take great pains over the design and the governance of their communications services to ensure they meet service requirements rather than cost targets,’ Hart says, pointing out that for emergency services ‘penalty clauses that pay money are of little use.’
Arqiva’s Mace, however, thinks service level agreements (SLAs) are essential in terms of giving organisations comfort that outsourcing is reliable and able to meet their needs: ‘With outsourcing, every customer is entitled to an SLA – which generally mitigates any stakeholder concerns,’ he says. ‘The SLA is also a safety net; an emergency service that relies on its internal communications may be entirely swamped in the event of a flu outbreak, for example. Outsourcing means they have a dedicated, scalable team operating under an SLA.’
He also thinks emergency services’ caution is understandable. After all, some outsourcing deals support life saving activity. ‘They are, of course, naturally cautious at first, but when they get into the mindset of leaving it to the professionals, that nervousness goes away,’ he adds.
‘The benefits largely outweigh any perceived negatives – and not just in terms of cost saving. In the past, police forces have often employed officers to manage technology rather than tackle crime. As well as enhancing efficiency, Arqiva has helped forces generate new revenues by leasing their communications sites and assets to appropriate third parties. There is a growing need for new sites, equipment and floor space across the communications sector, and many police assets are highly rentable,’ says Mace.
Watkins sees a spate of different approaches emerging: ‘The emergency services have always been cautious about managing risk in the delivery of critical frontline services, but approaches and attitudes do differ from organisation to organisation, which is not really specific to one of the emergency services,’ he says.
‘This is evident in the range of in-house, managed service and outsource models currently employed today. The autonomous nature of individual emergency service organisations permits a range of approaches even within each service,’ adds Watkins.
Pushed to outsource
The economics are pushing emergency services in general, and the police in particular, to outsource. ‘Her Majesty’s Inspectorate of Constabulary has indicated in its recent reports that the police service needs to outsource more,’ says Hart.
Watkins says his clients are examining a range of ways to cut costs. ‘We are seeing different approaches in meeting budget shortfalls from our clients. Some clients are bringing more services in-house and taking a managed risk approach to service support arrangements. Others are examining opportunities for wider collaboration and shared services. Some are reviewing strategies for reducing their supply chain and building strategic partnerships with primary service providers, while others are anticipating the threat of greater outsourcing