Case studies

Insourcing

Designing the right delivery model for this growing asset management organisation meant bringing work back in house, supported by the right processes-led ways of working. 

The background

As a successful asset manager specialising in the growing field of renewable energy, our client had ambitious plans but felt they were being held back by the structure of their back office functions. Finance and operational processes had been outsourced to a third party provider, based in Cardiff, around three years previously. The organisation established the arrangement to save time and reduce cost but in reality was finding a lack of quality in the work completed externally. Therefore a large amount of checking and rework was needed. Frustrations were running high.

 

 

Our aim was assess, recommend and implement the best delivery model for the organisation. In this instance, our recommendation was insourcing - bringing the processing work back in house. 

The challenge

The organisation approached us for an objective view due to our expertise in designing and stablising new models of delivery for back office functions. Understandably, the team were already feeling stretched. Therefore there was an initial level of reserve about the feasibility of bringing work back in house.  

 

An additional level of challenge came from the existing outsource provider who were (as to be expected) not supportive of the organisation terminating their contract and were demanding a financial payment to exit the agreement.

What we delivered

Strong relationships and trust

  • Allayed fears about insourcing by demonstrating how work could be made more efficient.

  • Presented solutions and options, making sure our experience of similar scenarios could save time and effort for the already busy management team.

  • Leveraged experience from similar projects to coach the Chief Executive on how to manage successful exit negotiations with the outsourcing provider. 

 

 

‘Fix and shift’ rather than ‘lift and shift’ 

  • Designed a process-based structure that would support more efficient ways of working.

  • Optimised processes rather than moving back the existing ways of working.

  • Ensured the client was forward-thinking with a design that could scale up to meet their future plans.

 

 

Stabilised the new in-house model

  • Provided person specifications and made sure recruitment of new team was successful.

  • Documented new standard operating procedures and delivered training to the team.

  • Ensured processing times, quality and performance measures were met before handing over.

 

The results

The new model of delivery required a new headcount of fifteen –considerably fewer than the number assigned to the work via the third party agreement. Overall, the project resulted in savings of around £500,000 a year in terms of direct savings as well as lower audit costs. In addition, the management team are now benefitting from more time to focus on the work that can add value and help to move the organisation forward. 

Our client were able to leave the outsourcing contract with minimal financial implications and no reputational impact, and, 

despite responding to changes in delivery timeframes, we were able to deliver on time and under budget, returning a saving in consultancy spend at the end of the project.