Agenda item

Cllr Dan Levy, Cabinet Member for Finance, and Ian Dyson, Director of Financial and Commercial Services, were invited to present a report on a Commercial Strategy Update.

The Committee is asked to consider the report and raise any questions, and to AGREE any recommendations it wishes to make to Cabinet arising therefrom.

Cllr Dan Levy, Cabinet Member for Finance, and Ian Dyson, Director of Financial and Commercial Services, were invited to present a report on the Commercial Strategy Update.

Cllr Levy highlighted the necessity for a commercial strategy to shift the County Council's approach towards pursuing appropriate, risk-assessed commercial opportunities to enhance revenue for essential resident services.

The Director of Financial and Commercial Services provided an update on the commercial strategy's implementation, noting the completion of a commercial maturity assessment that indicated a low initial level of commercial thinking, but there was a high willingness to engage with such commercial thinking. The primary areas of focus during the implementation included strategic direction and partnerships, governance and performance management, capability, and visibility and insights. However, progress had been slower than expected due to organisational design changes and complexities in required adjustments.

Members noted the lack of examples for commercial strategies and projects in the report, and questioned what kind of commercial activities and structures the Council could take on under the commercial strategy.

The Director of Financial and Commercial Services explained that the Council could explore various commercial activities, including local authority trading companies, joint ventures, and partnership working. Specific examples mentioned were utilising land and building assets more effectively and exploring opportunities in waste management, such as reuse initiatives at housing waste recycling centres.

The strategy emphasised an outcomes-focused approach, looking at what the Council aimed to achieve and identifying the right partners and delivery models to support those goals. The Council needed to consider the most appropriate delivery models for different activities, which could include trading companies, joint ventures, or partnerships. Collaboration with partners was crucial for achieving the desired outcomes and leveraging opportunities.

It was acknowledged that the Council was not yet at a stage where specific commercial opportunities could be presented due to the need to build the foundational capabilities and improve data and contract management.The strategy emphasised the need to build strong foundations, including improving data management, contract management, and overall commercial acumen within the organisation. This foundational work was essential for enabling the Council to be more commercial and innovative in the future.

Effective contract management was a critical component of the strategy. It involved improving skills, understanding, processes, and reporting to ensure that contracts were managed strategically and delivered value.

It was acknowledged that the report did not offer a clear timescale of commercial thinking examples, but this was reasoned by Officers because of the maturity assessment which emphasised the early stage which the organisation was in. However, concreate examples of the organisations commercial thinking would become clear over the next 12 months.

The Chair questioned whether the example of any other Local Authority was being used as they went about becoming more commercially minded, especially from similar starting point to Oxfordshire.

Coventry Council was highlighted as an example of a local authority that has successfully implemented commercial thinking. The Chief Executive had experience with Coventry Council and was pushing Oxfordshire County Council towards a similar approach of commercial thinking.

There had also been significant interest from other local authorities in how Oxfordshire County Council was approaching the process of becoming more commercial. This suggested that many councils were in a similar position and were looking to learn from each other's experiences.

Members questioned whether as an organisation, the Council was committing enough staff time to negotiating and managing contracts, and whether there was capacity within the organisation to use staff experience and knowledge to discover further efficiencies.

It was acknowledged that the Council needed to allocate more staff time for effective contract negotiation and management, especially for high-value contracts. Current resources allocated were not adequate to drive the best value for money, and a more strategic approach was required.

Big changes to how business planning, and contract management, was approached was suggested. The Council was transitioning from annual service plans to comprehensive four-year business plans to enhance commercial thinking and spending practices. The new organisational design included 12 Directors, each responsible for developing and implementing plans to identify better spending opportunities and drive commercial thinking in their areas. Each of these Directors would work with every member of their teams to discuss and bring forward new money-conscious and commercially minded ideas.

Members enquired about the role of the Innovation Hub in the Commercial Strategy and who was on the Commercial Strategy Board.

The Innovation Hub was crucial to the commercial strategy. Headed by Laura Peacock, the Innovation Hub integrated innovation into the Council's commercial activities. Laura Peacock was also a member of the Commercial Strategy Board, alongside Ian Dyson, Melissa Sage, Paul Grant, Sean Rooney, Charles Butters, and Natalie Crawford. The Board oversaw business cases, spending control, and strategic commercial opportunities within the organisation. As such the board played a significant role shaping commercial policy for the Council.

On the conclusion of the discussion on the Commercial Strategy update, the committee NOTED the report making the following observations:

· Frustration over the pace of progress to date, particularly in relation to developing specific commercial proposals.

The Committee AGREED to the following recommendations to Cabinet:

· That it develop and share with the committee on a regular basis a more detailed project plan for the Commercial strategy, outlining specific commercial opportunities in development, enabling activity, timelines, targeted savings or expected income generation, risk and RAG ratings.

· That the Council give consideration to seconding staff to exemplars of good commercial practice in the private sector.

· That the future iterations of the Strategy should clarify how it intends to help the Council make money, how money will be used more efficiently, and how it will be used more effectively.

· That the Cabinet invest in greater capacity to undertake strategic and mid-contract management of contracts.

· That representatives of Adult Social Care and Children’s Social Care should attend the Commercial Board.