by John Knight
The winds of change look to be blowing across some local authorities when it comes to their trading companies. For many, it may be time to review their arrangements.
Remember, a successful local authority trading company needs to have all of the following:
- A robust business case
- A competitive strategy, business and commercial plan, along with an in depth understanding of the local market
- The capability to deliver
- A transparent and robust governance and scrutiny framework
Does your trading company still make sense?
We’ve seen how quickly the world can change. In a different economic environment, a trading company still needs to make sense. To understand whether it does or not you need to consider, first and foremost, are you getting the promised and predicted outcomes for your market? Do you have the right people operating it, bearing in mind that a very different skillset is required for a commercial operation? Is the business case still sound? If it is not, that does not mean setting up a trading company was not a good idea at the time, for that particular time.
In some cases, unfortunately, the premise on which a trading company was developed may have been incorrect and the evidence on which the business case was based may not have stacked up in reality. Reviewing performance is crucial, to ensure you are getting the best value from your arrangements. Local authorities have a good track record for setting up new ventures, but are much less successful at knowing when it’s time to quit. If a trading company is not delivering on its financial promise, then the worst decision is to do nothing and let it keep losing money.
At C.Co, we support organisations with solutions for all aspects of change management, enabling successful improvement and transformation across the public sector. When it comes to commercialisation, we can help explore options for improvement or provide support to insource services back into the council.
If you are interested in finding out more, please get in touch with us today.