1 Purpose of report

1.1 To update the Finance & Resources Committee on implementation of the new telecoms contract and to propose the reinvestment of part of the efficiency savings as part of the Achieving Excellence - Customer Services programme to provide additional functionality to support contact centre operations across the Council.

2 Background

2.1 The Finance & Resources Committee of 17 June 2008 agreed to the award of the PSTN (telephone lines and calls) contract to BT Plc and to a project to migrate all Council telephone lines to a single contract achieving significant efficiency savings.

2.2 The Committee noted that £750k of efficiency savings were expected to be achieved over the 3 year term of the contract, but that realignment of departmental budgets would be required to achieve all savings. It was recommended that a single central budget should be created for the new contract given the new approach to billing and management required by the contract.

2.3 The Committee recommended that the efficiencies gained through implementation of the contract were ring-fenced for budgetary planning purposes given the particular need for further investment in telecoms to improve customer services across the Council.

3 Update on Progress

3.1 Phase 1 has now been completed with savings slightly reduced from £0.591m to £0.548m as delays have occurred in the migration of sites to the new contract.

3.2 In parallel to the migration of the corporate telephony service the opportunity has been taken to rationalise freephone numbers used across the Council to a new contract. Previously freephone numbers were created by individual departments in different ways at significantly different costs. This has delivered a further £27k per annum of efficiency savings which have been past back to Finance, Health & Social Care and Services for Communities.

3.3 Further analysis has indicated that the potential savings from Phase 2 of the project reported to Committee were conservative. Over the remaining life of the contract it is anticipated that £708k of efficiency savings will be delivered, increasing the combined savings of the new contract to £1.256m. This assumes a plan for savings in 2009/10 based on an eight month transition of lines to BT plc.

3.4 In order to maximise the delivery of efficiency savings the Council will seek to migrate sites in Phase 2 to the new telephony contract as quickly as possible.

4 Reinvestment to Support Service Development

4.1 E-Government and BT are currently preparing a Telecommunications Strategy for the Council which will provide a clear roadmap for development of the service over the next five years. IM Consulting, a partner of the National Computer Centre, are providing independent assurance of the strategic direction. Initial priority has been focused on Call Centre Management systems following consultation with departments.

4.2 The current Call Centre Management (CCM) system used by the Contact Centre is out of support, is not scaleable to other departments outwith Chesser House, and does not provide all of the functionality of newer systems.
The Council's Customer Service Strategy requires that we have a baseline of Customer Contact information obtained through a CCM system to inform service improvement. Other departments have indicated benefits from such a system and it was considered prudent to consolidate these requests to BT to provide an integrated, scaleable solution across the Council.

4.3 Following option appraisal, the product Solidus was selected which is also part of the Ericsson product-suite and will leverage the significant investment the Council has already made in the Ericsson platform. Both BT and IM Consulting have confirmed that it is a suitable long-term investment within the context of the developing strategy.

4.4 The key benefits of this project are based around customer service improvements primarily as a result of increased real-time management information. This will assist Service Managers in monitoring and managing overall service levels, team and agent level performance. In addition, the Council will deploy two key functions: advanced call routing and skills based routing.

4.5 Automated services can also be developed to allow for response to many customer inquiries without involving an agent, for example, for public announcements and broader general public information. The Solidus system can also be developed to request feedback from customers via automated surveys. In the longer term, the Solidus platform could be integrated with a Customer Relationship Management (CRM) system.

4.6 This product can be easily rolled-out to other departments on the main voice network who need this functionality and additional discounted licences have been included to meet this requirement.

4.7 This solution will take 14 weeks to implement from the date of approval.

5 Financial Implications

5.1 Analysis of departmental spending has shown that that revised total efficiency savings for Phase 1 and Phase 2 now total £1.256m over the period of the contract. The table below summarises anticipated savings:

5.2 Initial investment in the Solidus Contact Centre Management System will require allocation of £241k of these savings in 2009/10 and £51k in each year thereafter. The project will also be supported by allocation of £89k of pre-paid labour within the core BT Partnership budget.

6 Recommendations

6.1 It is recommended that Finance & Resources Committee:

(i) note that implementation of the new telephony contract is now anticipated to deliver increased efficiency savings of £1.25m over the next three years an increase of £450k from that previously reported to Committee ;

(ii) note that rationalisation of the use of freephone numbers has delivered a further £27k of savings per annum for departments;

(iii) note that targeted reinvestment of savings, referred to in 5.2, is taking place to update the Council's contact centre management systems to support the developing Customer Services strategy.