BACKGROUND

BACKGROUND Our client was a local authority covering a new town of 90,000 citizens and employing 900 personnel.

What experience does Obsidian have in this sector?

We have worked with over ten local authorities and with three social housing organisations.

Nature of client's problem

The local authority had published a tight deadline for setting up an Arm’s Length Management Organisation but none of the potential internal candidates wanted to undertake the role of interim chief executive of the organisation.

Obsidian's experience in this problem area

Obsidian’s specialist consultant had three decades of project management experience across a wide range of project types and environments. He is a member of the Association for Project Management and an active contributor to the Risk SIG. He had worked with this local authority as an interim project manager and an interim programme manager. He had also coached and supported the Council’s Board throughout a significant organisational change programme.

Objective of Product/service offered by Obsidian

To set up and run an Arm’s Length Management Organisation – a private company limited by guarantee and wholly owned by the local authority – to manage and maintain the local authority’s housing stock of 10,000 properties.

How the assignment was carried out

In April 2006, after a competitive process, our consultant was appointed as interim chief executive of the Arm’s Length Management Organisation (ALMO) that was scheduled to take over the management and maintenance of a Local Authority’s housing service on the 1st October 2006. On appointment the company had no name, no premises and no staff. Our consultant acquired office space and a PA and arranged a series of consultation exercises; first to choose the Company’s name and then to select the logo and brand identity. The Company was registered. A comprehensive project plan was developed to cover all aspects of Board recruitment and development, staff transfer, communications, and legal and financial arrangements.

We established two teams, a Council ALMO implementation team and an ALMO team. Our consultant bridged the two teams. A risk analysis was undertaken and used to inform future plans. Whilst the housing service personnel were due to transfer across to the Company under TUPE arrangements, the Council had assumed that all support services would be provided, through Service Level Agreements (SLAs), by Council employees. Fifteen SLAs were negotiated with various functions within the Council, but our consultant argued strongly that the new company should have its own department of resources, headed by a Director, to provide the board support, HR, finance and project management functions and that the Company should acquire its own legal advisors. His view prevailed after some considerable resistance. Working with another consultant and these independent legal advisors, we were able to make, and agree with the Council, significant amendments to the DCLG’s Model Management Agreement - so as to allow the Company adequate freedoms to operate successfully in the evolving social housing arena.

Our consultant developed a communications plan which included a series of workshops for housing staff and a variety of media activities to reach both customers and the wider stakeholder community. He also arranged for a “Test of Opinion” – as required by legislation before an ALMO is allowed to go live. This test of opinion involved:

• The use of response cards offered by all staff during any type of face-to-face contact with customers during a two week period
• A telephone survey of a random ten percent sample of the housing service’s customer base.

This survey sample was skewed to ensure that it included ten percent of the BME cohort of customers.

Our consultant attended fortnightly board meetings and led the Board Members’ development in areas of strategy and governance. He oversaw the development of the mission, vision, value and strategic objective statements. He also attended fifteen tenant and resident association meetings. He was appointed as Company Secretary and arranged for the Company to register for corporation tax, PAYE and VAT. In concert with others he was responsible for creating a budget for an annual turnover of £29M and for a delivery plan which identified all the actions necessary to achieve a two star inspection rating from the Audit Commission. He dealt with complex issues involving the transfer of service tenancies from the Council to the Company. He directed the project to create a 150 page website that went live three days before the 1st October. He also directed a re-branding project that encompassed vehicles, clothing, forms and stationery. He engaged with the Council’s facilities management staff to design an office layout for the 150 staff that were to relocate into a central atrium of the Council premises in the weeks immediately prior to go-live. A countdown project was instituted to cover all the minor issues that were to be resolved prior to the go-live date. An opening day project was set up to cover ceremonies, celebrations and a tour of the Company’s facilities and its housing stock. Our consultant remained as Interim Chief Executive for two months after the Company took over the management and maintenance of the Council’s housing stock. With the sole exception that one independent Board Member remained to be recruited, all the objectives of the project were achieved.

Benefits for the client

The Company went live on time, within budget, and with a smooth transition of staff from public sector to private company employment. Staff morale was sustained and re-enforced. The performance of the housing service continued to improve notwithstanding the turbulence created by the transition process. The opening day was a great success. The Audit Commission Inspector remarked that for the ALMO to go live on the date originally set as the deadline was a clear indication of the organisation’s ability to deliver change.