The document discusses the potential benefits and challenges of consortia for small organizations in the social sector. Key points include: - Consortia can help overcome barriers small organizations face such as large/complex procurement processes, contracts, and lack of opportunities visibility. - By combining resources, consortia provide scale, specialized expertise, and bargaining power to members. However, building trust between members and managing conflicts of interest can be challenging. - For consortia to be successful, commissioners must be committed partners and members must develop strong leadership, business skills, and an entrepreneurial mindset. Proper governance structures are also important to ensure accountability.

1. Consortia: way forward or
waste of time?
ACEVO &
Neil Coulson Associates

2. Why consortia?
Barriers Facing Small Organisations
• The procurement process (long, complex,
expensive)
• Unable to find out about opportunities
• Contracts are too big
• Frameworks (if too complex and too large)

3. Barriers…cont
• Pre-qualification
• Understanding the requirements
(anachronisms used, poorly worded
specifications)
• Lack of feedback
• Cashflow

4. Consortia – overcoming barriers
• Scale
• Development of specialist tendering and
contract management infrastructure
• Greater bargaining power
• Adding value at the frontline
• Building capacity

5. Key Trends Part 1 (deficit reduction and
heightened competition)
• Deficit reduction
• New forms of private sector competition
• New forms of social economy
competition through ‘externalisation’ of
public sector human resources

6. Key Trends Part 2 (changing dynamics)
• Radically changing dynamics within the
commissioning arena
• The ‘more for less’ agenda – downward
pressure on unit price and greater focus
on outcomes
• Reduction of ‘transaction costs’ through
aggregation (joint commissioning,
bundling) -> devolved commissioning

7. Key Trends Part 3 (political reform)
• Big Society – shift from state to non-state
provision
• Modernising Commissioning
• Localism Act (inc. Community Right to
Challenge)
• Social Value Act
• Personalisation
-> Growth of voluntary sector consortia,
management companies, special purpose
vehicles

8. Different Contracting Forms
• Provider
• Managing Agent
• Managing Provider
• ‘Super Provider’

9. Provider
Contractor
Provider Provision of Services

10. Managing Agent
Contractor
Managing Agent
Sub-contractors Provision of Services

11. Managing Provider
Contractor
Managing Provider Provision of Services
Sub-contractors Provision of Services

12. Managing Agent/Provider
Contract top slice
Percentage of contract to pay for
management of sub-contractors:
 Performance
 Quality
 Financial management

13. ‘Super Provider’
Provider Provider
Provider Provider
Provider Provider

14. aka Formal Consortium
Collaboration Spectrum
Networks/ Loose consortia Formal consortia Mergers
Partnerships

15. How does it work?
• Incorporation to form new legal entity
• Providers become members of this
company
• Hub and spokes operating model

16. Hub & Spokes operating model

17. Ownership & Management
Structure

18. Social ownership
• Owned and controlled by the members
• 2 tier governance:
Council of Members
Board

19. Some Examples
• Sheffield Well-Being Consortium
• Wakefield District Well-Being Consortium
• Desta
• C3C
• Greater Together
• Synergy

20. Challenges
• Building trust
• Managing conflicts of interest
• QA and accountability
• Measuring social return
• Access to capital
• ‘Investment readiness’

21. Critical Success Factors
Demand side
• Commissioner Commitment
• Commissioners’ Attitude to Change & Risk
• Market Opportunities

22. Critical Success Factors…cont
Supply Side
• From culture of entitlement to culture of
enterprise
• Leadership, business skills and
entrepreneurial acumen
• Long-term vision
• Resilience

23. http://consortiasupport.org.uk/