“Shared services” is a term used in many different contexts, and seems to be the current buzzword in New York State in municipal management. By definition, it involves attaining some form of efficiency for those involved, through an arranged partnership and cross utilization of personnel or equipment.
A NOT-SO-NEW IDEA
Though more recently placed in the spotlight, shared services is by no means a new idea. Municipal leaders and department heads have been sharing equipment and “helping each other” with workforce collaboration or project coordination for years. Finding ways to achieve efficiency is a local government phenomenon by default. Municipal officials must continually lower the cost of providing services, or be held accountable for rising taxes.
The dilemma faced in community leadership is how to maintain levels of service, especially those that preserve quality of life, WHILE lowering costs. This describes a form of local government efficiency.
HOW CAN WE GET THERE?
As municipal consultants, we help local government officials implement new technologies and tested best practices. We share the operational achievements and successes of our partner communities, so that others can learn new methods for achieving improved operations or cost-savings.
We challenge local governments to thoroughly analyze their services, including how they are provided, what they cost, and what challenges exist in their delivery. We also ask communities to set operational goals, and to establish benchmarks for measuring “success” in achieving them. In many workshops and presentations, we’ve shared our belief that this kind of analysis is a much-needed predecessor to forming partnerships and initiating shared services projects utilizing state funding.
However, all of this sounds a bit out of touch with the reality of high-pressure, day-to-day operations for local governments. Department heads may justifiably ask, “Do you really want me to analyze how we manage community services, or do you want me to get the job done?” Often, the non-stop demands of residents keep much needed analysis from ever occurring.
What’s needed most are recognizable, easily implemented solutions – demonstrations of efficiency or shared services that generate immediate savings.
CALCULATE THE SAVINGS
One quick, cost-saving option is to utilize consultants. This can be a surprisingly simple solution when there’s a “hole” in the staff, when in a period of transition, or when personnel are currently underutilized. In the right circumstances, part-time use of experts can cost significantly less than full-time personnel whose knowledge or skill set aren’t needed for 40 hours, every week.
Some basic math skills can reveal where the tipping-point lies, but when comparing the cost of in-house personnel versus a professional provider, budget directors must consider contributing factors well beyond staff salaries. Consultants typically do not require additional expenses for health benefits, retirement contributions, state-mandated insurance and compensation premiums, vacation coverage, or overtime. Consultants often provide their own tools and equipment in addition to their specialized skill sets, eliminating the cost of acquiring and maintaining expensive items, which are instead pro-rated by their limited usage (arguably a form of equipment-sharing among municipalities). Even travel and ancillary expenses can be negotiated out of consultant contracts, if a lump-sum fee arrangement is established.
“YOU GET WHAT YOU PAY FOR!”
Most importantly, consultants provide clearly defined deliverables. As a recipient of professional services, your community will only pay for the tangible, measurable work product received. Unlike employees with vast and diverse personnel objectives and performance targets, consultants must achieve completion of a well-defined scope of duties, or they don’t get paid for their work.
Given a well-written request for proposals, the process of selecting a consultant can also ensure that the duties performed are “right priced”. In order to be competitive, consultants can build optimal teams that include expertise as needed, but otherwise depend upon the professional contributions of their least-costly, sufficiently trained team members for each component of a project’s scope. In other words, your community won’t be paying an engineer to perform the work of an administrative clerk in between projects – a painful and costly result of keeping underutilized full-time staff on the payroll.
YOUR TEAM, ON-DEMAND
Because professional consultants work with many municipalities, they are in-fact “shared” personnel, paid by you ONLY for the actual work completed for your community. The professional ethics of a consultant require them to perform on your behalf, according to your best interests, just like your staff. Your part-time use of that individual, whose time is shared with other communities by virtue of their many professional relationships, requires no inter-municipal agreement. There is no defined partnership with other local governments, yet your community can still benefit from their history, knowledge base and experiences of their staff – all in the form of the expertise a consultant brings to your team.
The next time you consider expanding your payroll to meet a need, calculate the costs. Perhaps a part-time consultant can fill the void, enhance your team, help meet your objectives — and provide a considerable savings.