Commercial Strategy and Operating Framework

The Assignment

We were commissioned by Surrey County Council (SCC) to undertake an exploratory review of commercialism and commercial practices across the organisation. This was with a view to determining how the Council could enable a more coherent and strategic approach to commercialism as an organisation, to support long-term strategic objectives and financial sustainability in the context of ongoing fiscal pressures.

The Role

A commercial transformation programme had already been established by the Council in recognition of the opportunities to improve the organisational approach to commercialism, with a programme team set up to focus primarily on the Council’s trading and income-generating activity. Whilst our review maintained a significant focus on trading and income as a key aspect of the Council’s commercial activity, we recognised the importance of considering the full spectrum of commercialism and incorporated the wider areas stretching beyond trading activity, from procurement and strategic commissioning to capital investment and asset management.

To deliver this assignment, we adopted a blended team approach with the programme by establishing strong working relationships with the Programme Director and programme team, based on regular reporting and open discussion on emerging findings and themes.

The review was conducted through a two-pronged discovery approach to (1) understand broad organisational perspectives on commercialism (a ‘top-down’ view) and (2) develop deep insights into the specific workings of Council traded services. The initial phase involved a rapid process of engagement with senior executive level stakeholders, corporate services, and directorate commercial representatives from across the Council to understand their perspectives on what being commercial means, how it works in practice and the challenges and opportunities for the Council.

This was carried out through an iterative ‘discover-validate’ approach by continuously testing the emerging themes through the ongoing engagement. These themes were explored further through the second phase with a series of targeted deep dives into a sample of traded services. A subset of 12 traded services were engaged with individually through a series of working sessions to understand how they work in practice, as a snapshot of the Council’s wide-reaching trading activity. The findings from these deep dives were triangulated with the ‘top-down’ view into a validated set of challenges and opportunities.

Using the outputs from the discovery phase, we set out to develop a set of recommendations and actions for the Council to establish an organisational approach to commercialism and support the development of the commercial culture and mindset. Testing and refining these recommendations with the programme team and stakeholders engaged through the discovery phase, we developed a set of design principles and a proposal for the Council’s future commercial operating framework, with the high-level design of key components such as teams and roles, governance and risk, financial and performance management, and skills and culture.

Key Outcomes

Through the discovery and design work carried out, we were able to provide the Council with a clearer view of what commercialism can mean and do for the organisation, as well as a more strategic and coherent approach to being commercial to maximise value and outcomes and support the Council’s long-term financial sustainability.

We supported the programme team in the closing stages of the project to engage with senior Council officers and get their buy-in for the operating framework proposal. The proposal was subsequently approved by the Council’s Corporate Leadership Team, with executive officers signing off the framework and the associated recommendations for organisational design, new roles, governance arrangements and support mechanisms for commercial skills and cultural development.

Key to our success was recognising the complexity of Surrey County Council and the scale of ongoing change across the organisation to develop an operating framework that works for the Council, by being adaptable to future needs and avoiding the distraction and resource intensity of an organisational operating model redesign. Additionally, we applied an asset-based approach to the development of the framework, seeking to maximise existing resources and capabilities in the organisation, where possible, that could be sustained, strengthened or built upon to support and empower services to work in more commercial ways.

Since then, the client has progressed with our recommendations, including using our methodology to review another tranche of traded services, which has provided critical insight and intelligence for the organisation.