/ Business Case / Document Ref
PF02
Annex 2
Title & Ref. / CM04 - Corporate Customer Management (CRM) Solution
Council or SIP Ref. / Corporate Improvement Programme ( SIP result 3)
Prepared by / Kevin Martin
Version & Date / Version 1 – 14th September 2010CM04 - Corporate CRM Solution Business Case - kfm2 LH 170910
Budget / Maximum £782k

IWHAT IS THE PROJECT GOING TO DO?

  1. Objective
  2. The objective is to deliver a customer enquiry tracking and management system that will allow the Council to achieve the 4 design principleslaid out in the customer management programme across all services and access channels (web, text, face to face, phone, etc) to improve responsiveness and realise cash savings. (see para 4 below)
  3. This project will identify, then procure and implement, the most appropriate system for Fife Council. It will also define which functionality should be implemented and in what order.
  1. Scope
  2. All options to provide a Customer Management system(CRM) for Fife Council have been considered (see section III).
  3. Theproject has also consideredwhich system (including any associated hardware and software)will support the pace and scale of change required. This includes:
  4. Implementation of the chosen functionality in accordance with the programme plan.
  5. The integration of the existing in-house CRM, CENTRIS, with any new system, if applicable.
  6. A plan for the migration of CENTRIS and Front-Line Project (FLP - the predecessor to CENTRIS - whose functionality was not completely replaced by this functionality) to the new system and the decommissioning of these, if applicable.
  7. A decision on the future of the Corporate Data Hub (the source of people and property data for CENTRIS and other systems).
  8. Training of those who will administer and develop the new system.
  9. Training of users on any new system.
  10. Dependencies with other major programmes (e.g. Flexible Work styles)
  11. The solution will support improved processes on an end to end basis; from customer contact, through back office support to front line service delivery. It will therefore involve all relevant services across the Council and increase our ability to fully resolve queries at first point of contact.
  12. All staff whether directly in contact with customers or delivering supporting processes will therefore be in scope. Specific processes and services will nevertheless be targeted on a phased basis.
  1. Outcomes and Success factors
  2. The project will underpin most of the deliverables in the customer management programme. In particular the main success factors from the implementation of a corporate CRM solution will be to:
  • Improve or maintain customer satisfaction, so we can deliver more at first point of contact, increase speed of delivery, provide better information to customers, and keep customers up to date on progress of their enquiry.
  • Reduce the cost of delivery, anddeliver cash savings.

It will also:

  • Allow us to improve the speed and quality of service delivery regardless of how customers contact the Council (e.g. web, face to face, telephone).
  • Make it easier for customers to use lower cost, self service channels.
  • Reduce the reliance on IT Services to deliver core functionality and lowers the burden on limited ICT resources. This will allow new functionality (e.g. new customer queries or transactions) to be delivered in shorter timescales.
  • Reduce call durations, by giving customer service staff quicker access to the processes and information they need to resolve enquiries.
  • Reduce unnecessary contact, by delivering more at first point of contact, and making it easier to track the progress of enquiries and transactions.

IIWHY SHOULD WE DO IT

  1. Background
  2. The Customer Management Programme outlines a strategy for the next three year period to deliver significant improvements and efficiencies in how the Council interacts with its customers. This will be achieved by implementing improvements which embed the following principles across the Council.
  3. Delivery of services to customers as one Council, not as individual Services. All Council contact points will provide the same basic range of services, with additional services available from main contact points in each area.
  4. Delivery of services using generic processes to handle an enquiry, process a request, make an appointment/booking, assess and decide, deal with workforce planning and workforce scheduling. The same process will be used whether customers contact us by phone, over the internet, or face to face.
  5. Shift transactions and queries to lower cost channels such as Fife Direct or the phone/contact centre wherever possible. In particular high volume and/or low complexity phone queries will be routed through the contact centre, so the council has fewer telephone numbers.
  6. we also manage enquiries and information so we can learn from our customers' experiences across the Council
  7. The 2009 AnnualCustomer Report noted that the Council needed to extend the use of a single system to improve our ability to track the progress and status of enquiries across a wider range of services. We also needed to better understand the volume, type, and quality of response to customer enquiries across all council services and access channels.
  8. An effective CRM solution will enable us to manage transactions more consistently across the Council and allow many of the services to be accessed through lower cost channels.
  9. Although we current have a basic CRM system in place (CENTRIS) this is currently only used in the Contact Centre, Local offices, for complaints, and a few other key services. The core system works well, however it can take some time and be expensive to develop new functions, all changes to the system need to be done by specialist IT staff (e.g. all new scripts or processes), and there is limited opportunity to gain from the experience of other organisations and Councils as the software is entirely bespoke.
  10. There are potentially significant cost savings to be gained from introducing an improved CRM system. It has the potential to remove the need for a number of existing systems, therefore reducing support and maintenance costs. In addition it can cut out many manual processes providing significant opportunities for services to reduce running costs.
  11. Whilst the project falls under the governance of the Customer Management programme, it has been recognised that there are implications for other major programmes e.g.Mobile and Flexible Working and some of its objectives might be met more quickly depending on the choice of CRM.
  12. The first phase of this project was to appraise the options to deliver a system which can deliver the success factors outlined in Section 3.
  13. Options considered were:
  • To keep and further develop our existing in-house system (CENTRIS)
  • To consider the system procured by the Scottish Government’s Improvement Service which 18 other Scottish Council’s already use (Lagan)
  • To procure a new system via an open tender process
  • We will recommendthe option which provides the most opportunity to deliver cost-effective improvements to customer service.
  1. Summary
  2. The Corporate CRM Solution project is central to how the Customer Management programme goes forward and how quickly it will start to realise its outcomes and associated benefits.
  3. Of the £5.5m annual savings anticipated from customer management improvements, almost 80% of these are estimated to be driven by an effective CRM solution, as articulated in the Customer Management business case.
  4. The financial climate that will prevail in local government over the next five years makes it vital for the Council to start implementing the pace and scale of changes required to improve customer service delivery, yet do so at a lower cost.
  5. We need to make sure we deliver sustainable services as budgets are reduced, making sure we prioritise services and more expensive forms of customer support to those who need them most.
  6. This business case presnts the findings of the options appraisal on which CRm solution will best meet the current needs of Fife Council.

IIIWHAT ARE THE OPTIONS

Options that have been considered for the corporate CRMcan be summarised as follows:

  1. CENTRIS Option

This option would mean continuing to use CENTRIS (the in-house bespoke CRM) as the CRM/customer tracking system to deliver the functionality described in the Customer Management Programme.

6.1Costs

  • High level estimates were provided by IT Services for developing the relevant functionality in CENTRIS to obtain a like-for-like comparison with other options.

Implementation Costs / £1,746,086
Recurring Annual Costs / £40,000

6.2Ability To Deliver

  • There is nothing in the Customer Management Programme that CENTRIS is not technically capable of delivering, subject to further development.
  • There requires to be more joint work with the Council web team to deliver the self-service capability
  • ITServices (ITS)would need to provide significant development resources for the period of the programme.

6.3Development of New Functionality

  • It is expected that this option will be the most expensive and time consuming when new functionality is required, given our previous experiences of development cycles. It also relies heavily on ITS doing most of the configuration/development, with little control and flexibility for users to make any system changes however minor.
  • Over the past year CENTRIS development has adopted a design model which includes business logic within web services. This has the advantage that the web services can be re-used within other modules developed for the contact centre and web interfaces for public access. Over time this will reduce development costs but it is not possible to quantify by how much given the early stage of working with this new technology.
  • The costs to develop interfaces to backend systems should be similar to developing them for any other CRM.

6.4Re-use or Sharing Savings

  • There will be no opportunity to make savings by using modules developed or experience gained by other councils.
  • There will perhaps be less opportunity, or an increased cost, to re-use adaptors supplied by vendors for integration with back-office systems.

6.5Advantages

  • We would be developing an existing solution with which staff are very familiar and generally satisfied.
  • Training timescales and costs would be greatly reduced.
  • There is a much reduced reliance on 3rd party suppliers to take us forward.
  • Control over development and support and maintenance would remain in-house
  • There would be no need for an initial capital outlay to purchase another solution.

6.6Disadvantages

  • The current strategy within ITS is to buy rather than build and this option would undermine this approach.
  • Substantial IT resource would be required and this represents an opportunity cost for the Council in terms of its other IT priorities.
  • Experience has shown that development timescales tend to be protracted when undertaken in-house.
  • The businesslacks the flexibility to easily modify the system as there is limited scope for non-technical staff to do this.
  1. Purchase of nationally procured systemLagan
  2. The Improvement Service tendered for supplier to deliver a CRM solution for Scottish Councils in 2006. 18 other Councils currently use this system (Lagan). This option would be to adopt Lagan as the CRM/customer tracking system to deliver the functionality described in the Customer Management Programme. As Lagan has already been procured as the favoured CRM solution nationally by the Improvement Service, an umbrella agreement is already in place, therefore no tendering process would be required to purchase this system.

7.2Costs

The major cost of Lagan will be the upfront purchase of the core systems plus modules, services from Lagan to assist us, training and ongoing costs and maintenance.

Implementation Costs / £782,000
Recurring Annual Costs / £64,000

7.3Ability to Deliver

  • Lagan has undertaken a comprehensive review of the Council’s requirements and are able to deliver the functionality required.
  • Other councils have been contacted and have confirmed Lagan’s ability to meet their requirements which are similar to those of the Council.
  • Lagan’s plans have proven to be realistic in the past in their work with other councils and they have provided a high-level plan which indicates that the system could be implemented with our chosen functionality in around 10-12 months from sign-off.
  • Self-Service is a core part of Lagan and the Council will be in a position to give customers more choice as a result of this.
  • Lagan has successfully integrated with many other systems, some of which are in use in the Council (e.g. Confirm – system for reporting roads faults or Uniform – system for reporting Environmental Services requests).
  • An ITServices technical review has taken place which shows there are no technical reasons to prevent us form choosing Lagan. All identified risks/issues have either been mitigated, resolved or accepted.

7.4Development of New Functionality

  • It is expected that the development of new functionality will be less time consuming and therefore cost less than developing equivalent functionality in CENTRIS. The following information has been obtained from other councils to support this expectation:

East Renfrewshire Council estimate that it takes 25% of the time to develop new functions than it took with their previous CRM (Oracle)

North Lanarkshire Council claim that development of case management processes can be done more quickly.

West Lothian Council configured over 1000 business processes in around 3-4 months. Configuring simple – medium processes can take from an hour to a day and does not require specialist IT staff. The real time is spent agreeing these processes with the business in their experience.

  • Discussion with North Lanarkshire Council suggests that the costs to develop interfaces to backend system should be similar to developing them for CENTRIS.

7.5Re-use and Sharing Savings

  • There would be opportunities to make savings by using modules, experience and processes developed by other councils. There is a User Group website which will allow us to confirm any modules which may be of use to the council.
  • The Scottish Improvement Service is working to encourage councils to establish common processes and to develop re-usable modules. One example of this is the members’ portal which is a joint development by 6 councils.
  • There will be opportunities to purchase off the shelf modules to integrate with back-office systems from Lagan. The cost of these adaptors is likely to be less than developing in-house as Lagan will recoup their costs by selling to many councils.
  • As a Council we have the opportunity to re-use Lagan to manage caseloads in other areas and avoid the purchase of new systems. For example HR Direct are considering systems to help them manage their cases and Lagan could potentially be used. (Lagan are also about to implement a module for Absence Management.)
  1. Advantages
  2. The solution has been procured nationally and therefore it reduces significantly the implementation timescales.
  3. Eighteen Scottishcouncils have deployed or are planning to deploy Lagan. As part of a national Umbrella Agreement, preferential rates are available to councils who adopt it. There are significant savings in procuring through this route e.g. site licence reduced from £291,000 to £175,000
  • Lagan has produced a return on investment (ROI) analysis that has been modelled against the Council’scircumstances and aspirations. Based on the lowest investment model, they anticipate net savings over five years of £2.6 million, although further work is required to test how robust this model is, particularly given Lagan’s vested interest in being able to show a positive return. However it is worth noting that we believe that savings could be higher, so are confident that Lagan are taking a conservative approach to savings potential.
  • None of the Scottish councils using the system we have spoken to expressed any significant adverse reaction to the company or the product. They have confirmed that Lagan was implemented to time and budget. This providesthe Councilwith the evidence and confidence that the proposed plans are achievable.
  • The Lagan option offers flexibility and scalability and fits well with IT strategy overall. It also has the capability to be developed in line with the Customer Management and Mobile and Flexible working programmes.
  • The costs are lower in absolute terms than CENTRIS. The initial large outlay is mitigated by the vastly reduced costs of further development as we move forward compared to in-house development. For example trained staff in the contact Centre would be able to set up standard process flows for new enquiries as the need arises, e.g. in emergency situations with out the need for IT development.
  • The solution will allow Fife to achieve true self-service and offer our customers choice and value. This will include areas such as fault-reporting, special uplifts and environmental service requests when enquiries (e.g appointments or service requests) can be dealt with on an end to end basis online.
  • Lagan supports mobile and home-working and can therefore underpin some of the objectives of the mobile and flexible working programme, e.g. procurement of Lagan will allow the Council to purchase a leading appointment/scheduling tool of choice without going to tender and at a vastly reduced rate.

7.7Disadvantages

  • The Lagan model is a complex one with many adaptors to back end systems forming part of the solution, most, if not all of these, available for use only with Lagan.
  • The initial sum required is significant , which once spent reduces or removes Fife’s ability to change direction quickly without additional funding which is not likely to be in place
  • Whilst most Scottish councils speak positively of Lagan and have said that it brings many benefits in terms of improved processes, better service delivery, reduced licences, few have defined this in terms of actual cash savings.
  • There are terms and conditions in the Umbrella Agreement that were negotiated based on national requirements and may not necessarily have been those agreed by Fife if negotiating afresh. However subsequent investigation has shown that there are no real issues and there are many areas where negotiation can and will take place.
  1. Third party procurement
  2. Advantages
  • The Council will be able to reassure itself that Best Value has been achieved, particularly since the IS umbrella agreement is based on procurement carried out in 2006.
  • There could be the potential for another solutionto deliver most of the benefits of Lagan including an return on investment at least equal or better.
  • The tender will take place some years on from the original Lagan procurement and may introduce the Council to new technologies that may better support the future direction of the Council.

8.2Disadvantages