Models for Sharing
Having identified one or more areas where sharing may be beneficial, the organisations involved then need to establish a formal framework for the collaborative activity.
It should be noted from the above that, in this resource, we do not consider outsourcing, or any other straightforward commercial arrangement under an SLA, to amount to a shared service. We are thus considering the following types of arrangement:
- Consortium arrangements.
- Joint ventures where the institutions involved set up a separate legal entity to manage the service.
- National services where use of the service requires some form of contractual or membership arrangement.
- Charitable foundations where use of the service requires some form of contractual or membership arrangement.
The difference between the above types of collaboration and a commercial arrangement lies mainly in the need for additional governance with the above. This introduces a level of complexity that does not exist when an organisation simply signs up to a commercial SLA but often this additional complexity is felt to be worthwhile because, in this type of arrangement, the users play a much stronger part in determining how the service is developed and delivered.
Under this definition, services such as those provided by ULCC (University of London Computer Centre) could strictly be viewed as commercial arrangements, as indeed might the NORMAN out of hours Helpline in its current form, although few in the sector view them as such. The difference is partly down to the fact that these services are provided specifically for the sector by a trusted provider who is part of the sector. The NORMAN Helpline was one of the original HEFCE-funded shared services feasibility studies and has always viewed itself as a partnership despite significant growth beyond the original five members. It is a good example of how a relatively informal arrangement can prove its worth and grow into a different type of shared service.
In many cases sound governance arrangements are essential not only to achieve consensus but also in order to ensure the feasibility of the service especially in the early days. Duke and Jordan (2008a) make the very important point that arrangements need to cover the procedures for joining, and most importantly leaving, the service. They note that the unexpected departure of participants/contributors at short notice can have a significant impact on the delivery of services to other members and hence any withdrawal from the service needs to be carefully managed. The FEAST report (Clark et al 2011) makes a similar point that many centrally-funded initiatives do not take the necessary steps to ensure sustainability beyond the pilot phase.
Examples of some of the types of agreement reached by organisations that collaborate in this type of way include:
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The Kuali Foundation Membership Agreement which states that: 'The Kuali Foundation is not a vendor of Kuali systems, and Members must think of their role in the Foundation as being stakeholders in the evolution of the software and community.'
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The Sakai Foundation Partners Program Agreement which defines a very similar set of responsibilities for members.
Another sustainability success story is the Crescent Purchasing Consortium which is owned by the FE sector and run on the sector's behalf by the University of Salford. The organisation is funded by retrospective marketing premiums from approved suppliers meaning that it can offer free membership to any eligible provider of FE level education. In 2011 it had over 900 members.
Although government policy varies across the four home nations of the UK, there has been considerable effort made to point the FE sector to a range of collaborative options that should be considered as an alternative to merger. The Department for Innovation Universities and Skills (2008b) produced a toolkit to help governors and senior managers evaluate the options and a series of case studies highlighting examples of the different models.
Mergers are however still very much on the agenda for some of the devolved governments (more on this in the section on Mergers and Restructures). One of the most ambitious developments to date is the proposal that the University of Wales Trinity St David (itself a merged institution) and Swansea Metropolitan University should join with a range of FE colleges (Coleg Sir Gâr, Pembrokeshire College & Coleg Ceredigion) to create a regional education structure described as a 'Dual Sector University'. The arrangement is already a working concept and shared services are very much part of the agenda but the intention is to take the partnership as far as a full merger to create a single new university for South West Wales.
The following guidance was produced specifically for JISC projects but may be helpful to anyone undertaking pilot work that may ultimately turn into a shared service:
'Shared services and collaborative arrangements are complex and involve significantly more negotiation and administration than those led by individual institutions alone, especially in the initial stages of a project.'
Welland 2009
'In the UK, it is not unusual for the Bottom-up approach to arise from grass root innovation and to be followed by wider adoption and a transition towards top-down.'
Clark et al 2011
'Many colleges enter into partnerships which they call 'joint ventures' but are often simply informal arrangements for a specific joint purpose. An example would be a college partnering a university to create a Foundation Degree.'
KPMG 2010
'... an organisation may start with one structure and migrate through to other structures as the shared service matures and a better understanding of governance and roles and responsibilities is gained.'
Duke &Jordan 2008a
'There has been more success with establishing shared procurement systems in FE in England, using a neutral third party 'facilitator'.'
KPMG 2010
'Top-slicing has been highly effective as a mechanism to prototype services and develop the embryonic service models. It has perhaps been less effective in developing the cultures of sustainability required for the emerging environments.'
Clark et al 2011
'... colleges appear to be more successful in setting up college companies for their own internal purposes, such as saving VAT on a college building scheme, or to deliver their own bespoke training, than they are in establishing companies or joint ventures between groups of colleges. ' ... even the 157 group has been unsuccessful to date in setting up a company.'
KPMG 2010
'If participants, including funders, were able to leave such an arrangement or cut back their contribution at short notice this could have an adverse effect on the service provided to others.'
Duke &Jordan 2008a
'Exit strategies are important and need to be considered from the outset. Clear time bound exit opportunities need to be built into collaboration plans. The context can change, organisations can change in size, change their policies, be split up etc.'
HELASS Project 2011
