Dynamic Purchasing System Background and Introduction 1 Background

Dynamic Purchasing System Background and Introduction 1

Background In very simplistic terms, buying provision for our customers was a lengthy complex process. This would Involve our National buying team, looking for a steer from local offices on what they would need for the year ahead. Invariably, this would lead to the same old, e. g. Confidence building, motivation and something for lone parents between 10: 00 a. m. and 2: 00 p. m. Providers knew what we were likely to look for so they tended to focus on this. The process could take up to about 9 months to get provision in place. In the meantime, the whole dynamic of our caseloads could have changed. This would often lead to us having courses with fixed start dates and offices struggling to fill them. It was agreed that this was not ideal and also that everything going through National Team led to bottlenecks in the process, leading to delays and frustration all round. 2

First Step To try to ease this situation, an easement was put in place that allowed District Managers to authorise the purchase of FSF provision up to the value of £ 50, 000. This was designed to streamline the process and remove bottlenecks. This would allow districts to source local provision, usually by means of Employment Partnership Managers (EPM’s) identifying a need and speaking to local providers, or it could be a local provider that would make us aware of a course they offered. The whole process was overseen by Finance Business Partners who would scrutinise all business cases to ensure they were relevant, necessary and would deliver value for money. Although this did improve the service somewhat, it was still not ideal as there was a lot of to’ing and fro’ing on applications submitted by providers. Often within the application, there would be areas that would be challenged, e. g. in the application for £ 49, 000, there may be a figure of £ 400 to purchase a desk, or to pay for some other item that would be considered as something they would already have or should purchase themselves. With a reduction in resource in the overall procurement organisation, further change was required. 3

Solution The method decided upon going forward was the Dynamic Purchasing System. This is a method of purchase that is used in some large Outside Industries. The idea being that rather than launch a new search for an item each time it was required, that suppliers make their offer, price and conditions known in advance. This would allow the buyer to simply and quickly consider the offers available when a purchase was needed. It has loose similarities to Amazon or Argos, where there is a catalogue of goods readily available to be chosen from. In our case, types of provision on offer. There are many commercial and legal considerations to be considered when purchasing on the scale that we do, therefore it could not be presented in such a fashion as this could potentially allow someone to pick and choose what they wanted from whom, when they wanted. Without safeguards in place, an individual could be accused of nepotism, buying repeat provision from family members or friends. Assurances on quality and value for money were also vital. 4

Other Considerations There were other things to be considered before this could be put into practice. We know of many hundreds, if not thousands of providers, each of whom offer a variety of provision for our customers. A method of cataloguing or indexing all of this provision had to be put in place that would allow providers to show what they offered and that could also be used by Employer Partnership Managers (EPM’s) and work coaches to search and find what they needed. What was decided upon was a series of Categories that both parties would use. These were numbered as Category 1 to Category 8 and showed an almost natural progression with Category 1 being those furthest from the labour market, through to Category 8 being customers who are in work but who perhaps need support to remain in their job. Each category listed shows a brief overview, expected content, funding model and Performance expectation. 5

Categories explained The sheet shows the following content for each category. Overview: A brief overview on expected purpose of course. Content: Gives a list of what we would expect to be delivered within the course, not exhaustive and not totally prescriptive. Looking to encourage innovation. Funding model: there are several funding models depending on category. All provisions will be paid a percentage of contract cost as a start fee (e. g. 30%). All courses will be paid a percentage of contract cost as a course completion fee (e. g. 50%). Categories 4 to 7 are expected to deliver a job outcome, therefore any provision bought in these categories will also receive part of their contract cost dependent on customers going into work for 4 weeks within a 13 week tracking period of course completing. (e. g. 30%) Performance: There are various performance expectations depending on category. This can range from 100% of completers to have an action plan completed, 100% to have a Social Justice Outcome or xx% to achieve a job outcome. A lot of courses offered are quite generic for the first period, offering some basic IT, motivation or confidence building with the latter part of the course focussing on the main barrier e. g. addiction, homelessness. Consider if you could offer more than one focussed part, possibly in partnership with some other organisation. This would increase the offers you can make. 6

Categories Explained cont’d Categories 3, 4 and 5 show client types expected to benefit from that category, e. g. Category 3 – moderate learning difficulties, complex multiple barriers and entrenched worklessness. This means when showing what the course delivers the expectation on the provider is that they show some specifics within their offer that will tackle the identified barrier. Categories 4 and 5 show several sub categories and any number of these can be applied for separately by a provider. e. g. if we were looking for provision for ex offenders, we would expect disclosure to be contained within the offer, when to disclose, what do I disclose etc. Remember that several of the examples mentioned in Categories 4 and 5 will also apply to customers who are further away from the labour market, not ready for work, and therefore an offer could also be considered under Category 2 or 3. Category 6 is for skills straining leading to a job and would be comparable to LVP or sbwa. It does specify that this category can only be considered for contracts over £ 50, 000. This would be where we anticipate large scale recruitment with lots of customers needing training. There is a way to obtain this training for lesser contract values which will be covered under routeways in next section. 7

• • • Examples of Social Justice Outcomes CV, interview techniques An Action Plan detailing steps towards employment Attendance at a training Course/Event Attendance at a non-work related community group or activity Voluntary Work Increased engagement with an individual or organisation Seeking help from a support group or worker, GP, Counsellor Steps towards removal of a barrier that makes the individual socially excluded e. g. talking to people, going out on their own, using public transport Community College Course, evening classes Increased motivation/participation in an activity Increase their social awareness/skills This list is not exhaustive. 8

Examples of Costing Model e. g. 1. Provider calculates a Category 4 Course for 10 people to cost £ 10, 000. i. e. £ 1, 000 unit cost person. 10 people start, they are paid 20% = £ 2, 000. 10 people finish, they are paid 50% = £ 5, 000. 10 people find work, they are paid 30% = £ 3, 000. Full contract cost of £ 10, 000 paid to contractor. e. g. 2. Provider calculates a Category 5 Course for 10 people to cost £ 10, 000. i. e. £ 1, 000 unit cost person. 10 people start, they are paid 10% = £ 1, 000. 09 people finish, they are paid 30% = £ 2, 700. 04 people find jobs, they are paid 60% = £ 2, 400. Provider is only paid £ 6, 100 against expected £ 10, 000. Some Providers have struggled with the job outcome element as they have misread the performance expectation figure to mean if they achieve the performance percentage (e. g. 30%) they get 100% Job Outcome payment. This is not the case, the performance expectation simply outlines to them our minimum expectation and has no bearing on the payment model. To achieve the needed cost of £ 10, 000, they may have to cost their offer at £ 16, 000 taking into account above calculations. 9

Routeways When looking at the 8 categories, there are some instances where we would think that having completed one piece of provision, we would be likely to look for something else to continue the customers progress, e. g. once we addressed someone's barriers, we would like help to get them into a job. This would be a Category 5 then category 7. Sourced separately, this could be 2 times 4 week courses from different providers with the likelihood being that the first 2 or 3 weeks of the second course replicates what had been covered in the first course. Route ways are a way of allowing providers to consider how they could run one course that covers multiple categories. In this case this would be Route way 3 and this could possibly allow a provider to say that 2 separate 4 week courses could be combined into one 6 week course. This would mean they could have an offer on for a 4 week course for Category 5, another four week course for Category 7 and they could also have an offer on for a 6 week Route way 3 course covering both categories, all with different pricing structures. Route ways 2 and 4 both include Category 6 skills training and could be used for lower valued contracts under £ 50, 000. 10

Provider Registration When DPS was first launched, an automatic message drop was made to all providers who were registered on our Bravo system for previous business e. g. LVP. EPM’s were also asked to supply contact details of all local providers they were aware of. These were then used in an email drop inviting them to register on our system and to upload their offers to the DPS. It has been challenging to get providers to register on the system and this is essential to get maximum support for our customers. Unfortunately we do not have access to the same system that providers use to register and can therefore struggle to offer support should they be experiencing difficulties. The embedded supplier Support pack contains a walk through with Screen Shots to help with registration process. There is an email address and help line we can refer to: Bravo Freephone helpdesk 0800 069 8630 available Mon – Fri 8 am to 6 pm Helpdesk via email: help@bravosolution. co. uk There is also an external organisation called Partners for Procurement who can talk you through the DPS process and answer any questions you have. Their details are – www. P 4 P. org. uk 0141 280 2560 info@p 4 p. org. uk 11

Uploading Offers Once registered on the system, the provider has to upload their offer on a 2 page form. This form must be used and cannot be substituted. They provide a detailed description of the intervention/course/provision in the space provided. This must be no more than 2 pages of A 4, in Arial Font 12 and must include the following as a minimum: Content of provision and how it is delivered; (Most important question, would suggest using one whole page and use conversational language. ) Details and evidence of how your provision will ensure that the claimant will: move closer to work/ move into work or remain in work (as appropriate); (Why would someone want to go on this course? . ) Your performance offer i. e. what will the outcomes (e. g. % job outcomes and outputs (e. g. Action Plans) be, together with your supporting rationale; How you will manage the performance of the provision to ensure outcomes and / or outputs are achieved (how will you achieve starts, completers, jobs) There are cases where a provider has pasted in information from a leaflet or previous paperwork they had. This is an automatic fail. 12

Uploading an offer cont’d When uploading the offer the provider is asked to supply some information that will be used as filters to allow the buyer to target in on what we need. These filters are as follows. Location: this is determined by location, with all UK jobcentres listed. The provider should tick all jobcentre locations they can deliver provision to, this can span several districts or indeed be National if appropriate. Categories: Each offer uploaded by the provider would be under one of the categories detailed on the category document, e. g. Cat 3 or 4. 6. Consider all categories and sub categories and upload to all that apply. Claimant Group: This can be by age group 18 -24, 25 -49, Lone Parents, Carers etc. Tick all that apply. Claimant engagement: One to One or Group. Number of Claimants: number required on group 1 -10, 11 -20, all the way to 301+. Need to tick all relevant boxes in order not to possibly be filtered out. E. g. they tick 1 – 10, we look for 12, they would be excluded. Lead in Time: from up to 7 days through to 31+ days. Once uploaded, the offer can be altered or updated at any time. Each change overwrites the previous copy. Be careful of having too many offers as you could effectively end up bidding against yourself. 13

EPM – Local Office Action The Employer Partnership Manager (EPM) will liaise with their local offices to identify a barrier or need that is preventing their customers moving forward. The local office will identify suitable customers that would benefit from this, including some reserve capacity to ensure full occupancy. (Skills conditionality) When a suitable number have been established, the EPM will produce a business case seeking provision for this group. An evidence stencil must also be completed and embedded within business case. They will identify what they wish using the same category sheet that the provider has uploaded under e. g. Category 4. 5 Homelessness. They will have to satisfy the Finance Business Partner that there is a need for this provision and also that there is no free alternatives available. They will provide evidence that there is suitable numbers of customers for this, quoting figures from DCAMs, caseloads or customer insight. They will describe what they class as Essential items and desirable elements that should be covered. Originally we were very prescriptive here, e. g. 4 wk course, Mon – Fri, 9 till 4 etc. this led to market failure as no provision was found. It was then realised, we are not expert on this, the providers are. They know whether or not a 2 wk or 6 wk course is necessary. We now submit business cases more open ended to allow for maximum 14 number of offers to be found and considered.

DPS Buyer Action When the Buyer first enters DPS, the system may show there are hundreds of offers available. As each filter is applied the available numbers will reduce. Ultimately with all filters applied, there will be a relatively low number of what may be suitable offers left. Those offers remaining will be printed off and the buyer will then score these offers against what has been identified as being essential and desirable against the business case. Question one is your main sales pitch so it may be worth using one whole page for this answer. The four questions are then scored with an overall score being recorded. The buyer will take the highest scoring offer and all of those scoring within 10% of this. The rest of the cases will be discarded. E. g. highest score is 40, anything scoring below 36 is discarded. Then and only then will the buyer look at price and knowing that all cases are within a 10% quality threshold, will choose the lowest priced offer. This will be passed to DM for final approval. This method provides assurance of random selection of offers as well as assuring quality and value for money. 15

DPS buyer action cont’d Once the District manager agrees to go ahead with the purchase of this provision, the buyer will contact the provider to offer them the contract based on the offer sheet they printed. At any time a provider may go in and change their offer, however at the time of a search, the buyer will print off what is current at that point and can only offer the contract based on this. Should the provider state they want any changes to what was on original offer, then the offer would be withdrawn. The reason being any change to contract could have altered your score and allowed another provider to have scored differently. Should the provider reject or be rejected at this point, then the second lowest priced offer would be offered the contract. When agreement is reached to accept contract, the buyer will contact the 3 rd party team who will liaise with the office involved to arrange a start date etc. Final contract will be awarded and a Post Contract Award Briefing meeting would be arranged to allow Provider, office involved and 3 rd Party team to discuss the steps involved in staging the course. 16

Course Conclusion It would be expected that with in our business case and the provider offer, there is some form of exit strategy mentioned to allow for a handover back to work coach. This could be an action plan or record of achievement. Follow up action should continue to ensure that customer gets maximum benefit from the provision we have purchased. Although the provider may have a job outcome element within their offer, we should also be supporting our customer on their return. When a course completes successfully, we should immediately be considering whether or not a repeat business case should be submitted to keep momentum going. 17

Additional Information We cannot speak to a provider about their specific course content or what we need. To comply legally we must be seen to be fair and we must ensure all providers are given the same information. To help providers when there are issues, a hints and tips document can be sent to “All” providers. We cannot discuss issues, or reason for not getting contracts with individual providers. Details on contracts awarded (with value over £ 10, 000 can be found on Gov. Uk by searching for Contracts Finder. See last page of presentation for instructions on finding and working with Contracts Finder. A job outcome is determined as 4 weeks work in the 13 week period following course completion. The Provider must produce evidence of this, wage slips, letter from employer etc. It does not need to be a continuous 4 week period. For JSA, ESA, and IS a job is classed as 16 hours or more. For UC, evidence must be provided of earnings of at least £ 338 per month. Jobcentre plus premises can be used to hold a group session to allow the provider to discuss course with possible attendees but cannot be used to deliver actual course content as this would provide an advantage over 18 others.

Innovation One of the aims of DPS is to allow providers to demonstrate innovation in the way they help our customers. When this was being trialled in England, one provider who had experience in the construction industry, offered a building site type course that not only included CSCS card but also included certification in Bee Keeping. As strange as that sounds, the provider was aware that if a wasps nest or bees hive is discovered on a building site, everyone has to down tools and work stops until this is properly removed. By including bee keeping in the course, they were able to promote the attendees to employers as not only having their CSCS card but also as being able to deal with any bee or wasp infestations found immediately, which would save the employer money. Now that’s Innovation. 19

Working with Contracts Finder. Navigate to Contracts finder using the attached link here. Scroll down the page to “Other information” at the bottom. Here you will see links to contracts awarded for previous quarters. Click on the link you are interested in and this will bring up a. pdf document that shows all DPS contracts awarded across the UK for that quarter. Unfortunately, as it is a. pdf document it does not let you manipulate or filter the data, however, the following steps will enable you to convert this into an excel document that you can filter by region, category etc. It is quite laborious but follow the steps exactly and it does arrive at what you require. 1. Open the pdf document and click on Edit then click on Select all. 2. Again, click on Edit and select Copy. 3. Open a blank Word document, set orientation to landscape and select Paste. At this point ignore how this looks on your page. It is messy. 4. Now click on Ctrl A, the Control (Ctrl) button and letter a at same time. This will select all of the writing on the page. 5. Click on Insert tab at top of page and select Table, then click convert text to table. 20

6. Next step is picky but important, a dialogue box will pop up. One item says Separate Text at, select Other. Then in the little box next to it, delete what is in the box and type in a space. (typing a space is important) 7. A poorly formatted table will appear. Press Ctrl A again to highlight everything and then right mouse click on blue text and select copy. 8. Open a blank Excel document, right click in the uppermost left cell and select Paste. All of the information should now appear in table format in Excel. 9. Click on the grey number beside the line that contains all of the headers in the document and then Click on Data at top of page and click on Filter. 10. You will now have an excel table that will allow you to filter by District, Category, Value or whichever other option you wish. See example for October 16 to September 19. 21