SUMMARY OF LEADING PRACTICE ROLES, RESPONSIBILITIES AND SKILLSETS OF A COMMISSIONING PHN Table 7 below provides some leading commissioning practice features, drawn from PwC research and experience. Table 7: Features of leading commissioning practice Outcome setting Outcome measurement Contract set up Contract management Market capacity Organisational capacity Whole of population needs assessment and gap analysis informs outcomes to be commissioned Outcomes defined in an outcomes framework Outcomes are user driven rather than provider driven Outcomes are defined by all bodies Outcome framework includes SMART outcome KPIs Evaluation framework has been prepared and agreed reflecting program logic Outcome capture is operationalised Outcomes measured independently / or Co-creation with suppliers explored/deployed subject to conflicts of interest. Procurement approach is outcome orientated – allowing for the development of innovative solutions/responses to the delivery of outcomes – competitive dialogue like approach. Multiple suppliers mutually incentivised through (say) Focus on supplier relationships and partnership health as much as contractual delivery Planned, agreed and delivered meetings with the supplier(s) on a monthly basis. Monitoring supplier performance Limited outcome Market assessment/reviews undertaken Limited market and provider development Limited capacity building undertaken to help build market capacity Barriers to entry Organisational recognition of where commissioning capability needs to sit – and embedded as a core management skill Outcomes whole is seen as more important than service parts Commissioning capacity requirements clear for different
with responsibility for them (joint commissioning) Outcomes are expressed in ‘whole person’ terms rather than relating to particular issues Outcomes have been co-created with external stakeholders Significant scope for how outcomes would be delivered Commissioning Strategy integrated with legislation and policy guidance and requirements, including the PHN Funding Agreement measured by providers and checked independently Means established to deal with causality/exogenous factors – such as randomised control groups Feedback loop established to review outcomes and act accordingly Sourcing & demand management Procurement categories are defined purely from a supplier set perspective with alliance contracting. Price performance mechanism aligns with outcomes sought Advanced negotiation strategy Multi-period negotiation strategies developed and rehearsed Multiple rounds of negotiations with suppliers eliminated at each stage Discussions on solutions and price are separated (price discussed last) Price discussions focus on areas of variance in supplier submissions Select vendor and contract based KPIs required due to aligned incentives in contract KPIs change over time to reflect changing business conditions Non-compliance behaviour identified by both supplier and business and resolved quickly Managing leakage Processes are in place that minimise the opportunity for leakage e.g., on-line ordering platform – where this is appropriate Leakage is reported on a real time basis Leakage issues understood Buying arrangements seek to recognise the supply community but may not be acted upon Managing provider relationships Supplier management framework Close relationships with suppliers (i.e. localised partnerships) used to create competition board/staffing groups. Resource analysis and gap identification undertaken Board and workforce development plan tailored to requirements and identified gaps Pooled / flexible resources Predisposition towards plurality of supply / mixed economy / fitness for purpose