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CIPFA SCOTTISH STUDENTS’ SOCIETY “The Challenge of Change”

CIPFA SCOTTISH STUDENTS’ SOCIETY “The Challenge of Change”. Presentation Structure. Background - Scottish FE Colleges Merger – Why? Merger – How? Merger – Any lessons? Merger – Positive outcomes?. Background Scottish FE Colleges. 42 Colleges Governance – Board of Management

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CIPFA SCOTTISH STUDENTS’ SOCIETY “The Challenge of Change”

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  1. CIPFA SCOTTISH STUDENTS’ SOCIETY“The Challenge of Change”

  2. PresentationStructure • Background - Scottish FE Colleges • Merger – Why? • Merger – How? • Merger – Any lessons? • Merger – Positive outcomes?

  3. BackgroundScottish FE Colleges • 42 Colleges • Governance – Board of Management • Performance Management • Funding contract based on student numbers • Financial Stability • Quality assurance • Local Bargaining

  4. BackgroundGlasgow FE Colleges Anniesland College North Glasgow College Stow College Central College GCBP GCFT GCNS Cardonald College John Wheatley College Langside

  5. BackgroundGlasgow City Centre

  6. BackgroundMerger • Colleges incorporated April 1993 • 1997 GCBP & GCFT merger proposal rejected • Sept 2001 GCBP, GCFT and Central College • March 2002 Feasibility Study & Due Diligence • Sept 2002 all 3 Board agree to move forward • February 2003 Consultation issued • May 2003 Central College withdrew • Nov 2003 GCBP & GCFT submit merger proposal • Approved by Minister June 2004 • Glasgow Met formed 1st August 2004 • Transfer 1st February 2005

  7. Merger – Why?

  8. Merger – Why? • Political steer • Financial Stability • Operating Surplus • Historic Surplus • Income & Expenditure Reserves • Net Current Assets • Capital Investment

  9. Merger – Why? Turnover I&E Reserves Staff FTE

  10. Merger – Why? Operating Surplus

  11. Merger – Why?Historic Surplus

  12. Merger – Why?Income & Exp Reserve

  13. Merger – Why?Net Current Assets

  14. Merger – Why?Capital Expenditure

  15. Merger – How?Governance • Phoenix Model • Completely new legal entity created by statute • GCBP and GCFT transferred to Glasgow Met • Difficult to enter into contracts as new entity (Glasgow Met) not established until 1st August 2004 • Could not appoint Board or Principal until on or after 1st August 2004 • High Risk Model • Effective leadership difficult • Weak management • Decisions often based on compromise

  16. Merger – How?Governance • Board of Management • Appointed by Deputy First Minister • Established 1st August 2004 • 50:50 GCBP and GCFT • 12 members • Principal, industry & other stakeholders (7), staff reps (2), Scottish Enterprise (1), student rep (1)

  17. Merger – How?Governance

  18. Merger – How?Leadership & Management • Confident leadership • Strong management control • No redundancies (if affordable) • Effective communications • Trade union involvement • Matching-in

  19. Merger – How? Matching-In • Organisation Structure • Key planning activity • Should not be designed by committee • Desk research • Meticulous care • Span of control (set at 6) • Number of levels (scalar max set at 6) • Consultation

  20. Merger – How? Organisation Structure

  21. Merger – How? Matching-In • Matching in Procedures Developed • Minimal Impact Groups • All lecturers • Cleaners • Catering Assistants • Workshop/General Assistants • Some Technicians • Matching-in Committees

  22. Merger – How? Matching-In Committee

  23. Merger - LessonsMatching-In • Matching-in Committees • 4 formal grievances • Competitive Interviews • Out of 600 less than 5% interviews • Strong emphasis on competencies and evidence-based selection. • No disputes with trade unions • No Employment Tribunals

  24. People LessonsTUPE • EU directive on transfer of undertakings • Employment law minefield • Single biggest barrier to harmonising terms & conditions of employment

  25. People LessonsTUPE Management Terms & Conditions Lecturers (GCBP) Support (GCBP) Lecturers (GCFT) Support (GCFT)

  26. People LessonsTUPE & Equal Pay • Fertile ground for equal pay challenge • Current defence – differences arise from transfer of undertaking • Cannot take risk of forcing through new contracts for new appointments • Cannot talk about “harmonisation”

  27. People LessonsTUPE & Equal Pay • Age discrimination legislation (October 2006) has provided a spring board for change

  28. People LessonsOther • Staff morale – high risk • Senior management – high risk • Decision making overload • Complex & time-consuming decisions • Operational service delivery stagnates • Creativity stifled

  29. ComputerisedManagement Systems • Accounting System – Symmetry Oracle • Payroll/personnel (Wealdon) • Student Records (Capita) • Estates & Facilities (Concept) • Bursaries (Tequious)

  30. Finance & Accounting • Financial Management Systems • Management Accounting • Financial Reporting

  31. Finance & AccountingImplementation No additional staff • 2004/05 • GCBP • GCFT • Glasgow Met Audit Scotland

  32. Financial ManagementLessons • Importance of organisation structure • Cost centre relationships need to be built-up at an early stage • Allows for budgets to be built around new organisation structure

  33. Finance & AccountingLessons Hand Pick Your Managers

  34. Financial ReportingLessons • FRS6 – Mergers & Acquisitions • If merger part way through financial year, then consider keeping separate systems for full-year – because • It allows continuation of budgetary control and accountability

  35. Merger - OutcomesFinancial Performance

  36. Merger OutcomesFinancial Performance

  37. Merger OutcomesFinancial Performance

  38. Merger OutcomesStudent Recruitment

  39. Merger OutcomeswSUMs Performance

  40. Merger OutcomesAbsence Management Saving = £350,000

  41. Merger Outcomes • Organisation “refreshed” • Future risks – better spread • College more influential • Economies of scale • Improved space utilisation • Improved market brand & identity

  42. CIPFA SCOTTISH STUDENTS’ SOCIETY“The Challenge of Change”

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