By Michael Craig, Business Development Manager, Harbour Software
For millennia, resource sharing between jurisdictions has been in play, from crops to armies, unrelated regions have come together for the greater good of their communities. So why are councils stopping short of the big payoff when it comes to shared services?
As councils across Australia strategically plan for their future, one item high on their agendas is alleviating the numerous pressures on their bottom line, without affecting the quality of the services provided to their community.
One option that remains mostly unexplored – that offers perhaps the greatest cost saving of all – is a shared services model that includes the sharing of technology and staff.
How councils can utilise shared services
Shared services over the last couple of decades have appeared on most councils’ short list for cutting costs. As early as 2008, the Victorian Government set up a model to help councils navigate joint procurement processes while eulogising the benefits of shared services across the board.
However, a report published in 2016 about this initiative called Local Government Victoria and Collaboration Councils: An Evaluation 2008 2016, laments that the type of wholesale resource sharing hoped for did not materialise, stating that, “The barriers that exist are primarily organisational and cultural”.
The University of Technology in Sydney, in the same year, published a research paper of its own called Review of Resource Sharing Arrangements Between Kentish and Latrobe Councils. These two Tasmanian councils, under threat of amalgamation at the time, were the focus of this paper outlining the many benefits and how far resource sharing could be taken.
Now sharing a general manager, without losing their own identities as unique local government areas, is one of the hallmarks of its success. So, what do most councils think of when they are looking to utilise shared services? And are the shared services models implemented currently by councils delivering the cost savings they are seeking?
Up until recently shared services for councils involved a loose group of initiatives by neighbouring councils to collaborate on projects when the timing and desired outcomes aligned.
However, these projects usually only involved the procurement process; going to market together but purchasing separate versions of the technology. Taking this to the next logical step – sharing the technology and staff, which is where the greatest cost savings lie, has remained challenging for most councils.
The pressures that are championing this new model are multipronged, with financial being the obvious one. But costs and benefit analysis for amalgamations is not going to go away, making this the perfect opportunity for councils to not be the victim of the process but actively drive the change themselves.
Librarians have been ahead of the game when it comes to properly sharing services, creating consortia models where smaller libraries gladly outsource all back-end processes to a larger library, paying only a small percentage of the IT costs.
This model has other benefits, especially for borrowers who enjoy an expanded shared catalogue all while keeping their identities and feeling secure in the knowledge that their local library’s viability is not under threat.
New initiatives supporting shared services from end-to-end
When it comes to government programs designed for councils to share services, the Victorian State Government remains ahead of the curve, with the announcement in 2022 for a new program called the Rural Councils Transformation Project (RCTP).
The intention of this program is to help rural councils collaborate and implement new technologies that improve council services for their rural communities. Several projects are already well underway, ranging from a couple of councils to collaborations of up to four or five councils.
One of the projects successfully being implemented under the RCTP initiative involves Northern Grampians, Southern Grampians and Queenscliff Shire Councils.
A major overhaul by any standard, these Councils have come together and navigated the procurement and implementation process for a swathe of Software as a Service (SaaS) based products, while standardising the processes for how these products will be used by staff across these three Councils.
Vaughan Williams, Director of Corporate and Community Services, Northern Grampians Shire Council, has been part of the Council for 18 years and is proud of what this trio of Councils have accomplished.
“So far, the process has been relatively smooth, but this is because we all have our eye firmly on the prize – delivering the best services to our community while reducing the cost of delivering these services,” Mr Williams said.
“It’s a big project that includes our ERP, CRM, budgeting module, records, finance, infringement, payroll and building software. Using multiple vendors as we strive for a best of breed model.
“Our purchasing model is a bit of mixed bag, for example, one of the products we decided on is already owned by our Council so we will bill the other Councils for usage, while other products have been part of a joint procurement process that had one major stipulation – all products must be on a SaaS platform.”
Best of breed was once considered the worst solution back in the day but given the vast variety of SaaS based products with APIs on the market, the old issues of integration are over as they all talk to each other seamlessly.
Some of the products selected by this group of three councils, such as the one they’re using for planning, building and health, provide built-in templates for ratepayers to use when making applications.
Once these templates are completed there’s no need for a council officer to rekey in this information as the software automatically populates all required internal processes while safely filing it away in the record management system ready for retrieval if needed.
Like many councils, finding staff to service their growing communities is at times a struggle and Northern Grampians is finding this collaboration is providing a solution for this issue too. “In rural areas we are operating under the situation of scarcity when it comes to workers,” Mr Williams explained.
“The biggest concern is not losing your job but having a backup if you need to go away or are ill. Having uniform procedures and processes across the three councils means that we can share staff more easily.”
“There’s no limit to what can be achieved when councils work together. The most difficult part is not the technology – it’s the stuff between people’s ears. Sharing and collaborating includes compromising – a key component of living a better life.” Vaughan Williams, Director of Corporate and Community Services, Northern Grampians Shire Council.
Leveraging new shared services models to reap high cost savings
As councils start to take onboard all the benefits provided by SaaS based solutions, they will realise that treating this platform in the same way they did for their customised software residing on on-premise servers is a waste of resources and time.
In the future, councils will make the shift to truly sharing software while playing to each council’s strength. One council may be more proficient at planning, taking on this role on behalf of two or three councils while increasingly becoming subject matter experts – providing a level of service that far exceeds the expertise provided previously.
The biggest inroads councils have made over the last decade in shared services is in the areas of procurement and training, and whilst councils, such as the ones taking advantage of the RCTP initiative, are not common yet, they will be as these models provide proof of concept to councils across both Australia and New Zealand.
As this new trend emerges over the next few years councils may initially find it challenging to make the shift to this new paradigm, but like Mr Williams, I also believe councils are at an exciting moment in the history of shared services, and nothing can hold them back.
Author Bio
Michael Craig has been part of the local government ecosystem for over 35 years, starting out as an administration officer in metropolitan Melbourne. Mr Craig worked his way through the ranks to become Director of Corporate Services and Finance, holding this position in two regional Councils pre and post amalgamations, before deciding in 2000 to move into IT, to focus on the growing opportunities to improve council service delivery by utilising best of breed software. His company, Harbour Software, came into being in 2011, after successfully building a fit-for-purpose cloud-based meeting management solution called Doc Assembler.
