A VFM toolkit and self-assessment template

Report
VFM self-assessment workshop
This presentation provides a VFM toolkit
with a self-assessment template
Steve Smedley
Acuity Associate
May 2014
Workshop aims
To provide delegates with the tools and information to meet the
regulatory requirement to publish an annual VFM self-assessment
via:
1. Understand the updated regulatory context and emerging
lessons from Year 1
2. Take a look at the key ingredients of a VFM self-assessment
3. Challenge personal thinking through debate
It’s your day …
… informal and participative
Part 1: morning – 10:00 – 12:45
Introductions
Regulatory context brought up to date
Observations & lessons from Year 1
What has the HCA been saying about year 2
What might a self-assessment look like? – overview
Lunch (& registration for PM attendees): 12:45 – 1:30
Part 2: afternoon – 1:30 – 5:00
What might a self-assessment look like? – the detail
Some thoughts from me
Some thoughts from you - looking back and forward
Last thoughts
It’s your day …
… informal and participative
11am – 1pm - Part 1
Introductions
Regulatory context brought up to date
Observations & lessons from Year 1
What has the HCA been saying about year 2
1-1:45pm - Lunch
1:45 – 15:00pm - Part 2
What might a self-assessment look like?
• Some thoughts from me
• Some thoughts from you
Last thoughts
PART 1
Before dropping into Wonderland
• Who you are?
• What you do?
• What you want to get out of
today?
• Any particular issues, hangups?
REGULATORY CONTEXT …UPDATED
Co-regulation
Compliance
Horrible histories: VFM
This assumption is what
your self-assessment is
trying to dispel.
Once upon a time, the government
proclaimed that the public sector
should be more efficient.
Best value and VFM were
prescribed and inspectors checked
compliance.
Fast fwd: VFM regulation now
Review of Social Housing Regulation 2010
we expect in future the regulator to be more proactive…on ensuring
VFM…to achieve better returns for the taxpayer & support new
affordable housing supply
Purpose of economic regulation (current Regulatory Framework):
to protect historic government subsidy, promote access to private
finance, and help address the lack of competitive pressures on
providers which might otherwise put pressure on service quality and
efficiency
VFM regulation now
• Same set of standards apply to RASAs as 1000+
• Assurance-based approach to regulation
•
•
•
•
aim to obtain sufficient evidence (assurance) standards are being met
starting point is HAs’ own assurance on compliance with standards
HCA wants assurance that the board is assured!
HCA guided by 8 question engagement framework
• Q5 does the organisation demonstrate how it achieves VFM in meeting its
strategic objectives?
• requires a review of the assurance provided to board on the strategy for &
achievement of VFM
• so VFM self-assessment is key evidence/assurance
• ability to drive VFM a key indicator of quality of governance
What the VFM standard is trying to achieve & what
the HCA is seeking assurance on
Desired outcomes are no more than what an effective board will
already be doing - HCA looking for assurance that:
• providers have comprehensive & strategic approach to VFM that is board-led
• boards clear about:
• their strategy
• how the business is structured
• how its resources are applied to deliver their plan
• providers have effective performance management & scrutiny functions
• boards understand ROA, consider their use in the round & seek the best strategy for
delivering value from them, whilst meeting organisational objectives
• providers operate efficiently & effectively as possible, seeking to control and optimise
the relationship between costs and quality of services
• providers are as transparent as possible about the above and can be held to account by
key stakeholders
Matthew Bailes et al spring 2014
Round up of implications
• VFM now about the whole business – not just services
• value tagged to your objectives not 3rd party
• but has to reflect the value perspective of stakeholders
–publicly listed businesses maximise shareholder value
–social businesses maximise stakeholder value?
–raises tension between stakeholder value perspective eg
• existing v future tenants
• government (build) –v- sector (beyond bricks ‘n’ mortar)
• board/exec reconcile this
• self-assessment is a stakeholder doc
• reality check – VFM & (social) business effectiveness the same thing
• can you measure the value you exist to produce? – your product
Round up of implications
• greater emphasis on boards
• opportunity for the sector:
•demonstrate it can do co-regulation
•define value positively, in social business terms
• not just about cost cutting
• counter anti-social housing sentiment with a better
story
• assert significance of sector
• but avoid PR exercise
• HCA not dictating terms (yet):
•business model, allocation of resources: supply-v-servicesv-support-v-community investment
•organisational form – group, merge, etc
•operating structure, suggested costs, service levels
• but there is dissonance between regulation and politics
VFM self-assessment - first principles
Purpose of self-assessment =
demonstrate to stakeholders
how meeting the VFM standard
So what’s in standard?
• ‘doing’ VFM
• articulate & deliver a comprehensive &
strategic approach to VFM to meet
objectives
• application of 3 Es
• ‘reporting’ VFM
• reflects stakeholder interests
• robust
• transparent
• accessible
HCA specifically interested in these specific
expectations!..... especially the last 3…so
specifically address them!
Any specific expectations?
• ‘doing’ VFM
• robust approach to use of resources
• understanding RoA & strategy for optimising
returns
• effective performance management &
scrutiny
• understand service costs, outcomes & drivers
• ‘reporting’ VFM
• enable understanding of RoA
• set out absolute & comparative costs of
specific services
• evidence VFM gains (backwards & forwards)
The VFM standard.
What do you think?
Any observations,
issues?
Observations on year 1
•
•
•
•
•
unhappy with sector response – VFM not taken seriously
VFM mood music changed last autumn
failure of compliance rather than failure of VFM
downgrade G rating by one notch
HCA’s ‘presentational problem’ –communicating disappointment to
sector without government using it to further beat unloved sector &
regulator
• HCA unlikely to be more prescriptive – counter co-regulation
• smacks of box ticking & avoiding responsibility for managing the biz
themselves
• BUT HCA has given us some pointers…….(to be revisited)
• sector appears unhappy with HCA’s handling
• risk of compliance mind-set resurfacing?
Your take?
Observations on year 1
Determining what was required
• uncertainty about requirements
How was it
• level of detail?
for you?
• where and how to publish?
• accessible –v- comprehensive/technical?
• many opted for summary in accounts and detail on website
Roles
• extensive board sign-off but scope for more involvement in process
• understanding, challenging, owning output
• shaping the SA
• special role for audit committee
• only third used tenant scrutiny – obvious role here
• little reference to input from other stakeholders or even their perspective
Observations on year 1
How was it
for you?
Return on assets
•
wide interpretation – what was expected? Clarity required?
•
methodological & contextual issues militate against useful KPI
•
but killer headline metric not required
•
improving understanding of stock biz critical going forward
Absolute & comparative costs
•
use made of HouseMark data
What data did
•
sometimes limited in OFR but more elsewhere
you use?
•
some not stated costs – difficult to understand
Evidence of gains
•
HouseMark data, VFM registers, procurement, commercial return
•
tenant scrutiny, awards, accreditations not mentioned
•
key issue – evidence your gains (& performance), better
understand social value
Observations on year 1
Dissemination
• need to rationalise the docs that tell us about biz
effectiveness? OFR+?
• improve accessibility & transparency
• tone down PR
• reporting non-financial outcomes – learn from social
accounts
How about
Benefits
you?
• majority saw value in process as biz tool
Regulatory improvements
• clarify expectations – fine line prescription –v- clarity of
expectations
Self-assessment structure: different
strokes
HouseMark/S&P
approach
Corporate priority
approach
VFM standard
compliance
approach
You don’t
have to do it
like this!
Self-assessment approaches (templates)
The
HouseMark/S&P
•
•
•
•
•
•
definition of VFM in context of
purpose & objectives
strategic approach to VFM and
use of resources
arrangements to deliver VFM –
performance management and
governance
what has been achieved
plans for next year
board assurance on the VFM
self-assessment
to be revisited
The Compliant
•
•
•
•
•
background – ie HCA
requirement
what VFM means to us &
how seriously we take it in
terms of strategy & delivery
(ref standard)
return on assets
absolute & comparative
costs
past & future VFM gains
Some take a KLOE approach
• distil standards’ principles
• assess –v- criteria
What kind of
approach do you
favour?
The Corporate
•
•
•
•
•
overall judgement
definition of VFM in
context of purpose &
objectives
corporate objective #1
• aim
• arrangements to
ensure delivery
• achievements
• plans
corporate objective #2
• ditto
etc
Good practice from the sector?
• Helena** (infographic, varied approach to measuring asset and social return)
• GreenSquare* (honest, comprehensive, had a bash at ROI, embedded VFM,
bottom-up VFM - GreenState)
• Riverside** (honest, SA as improvement & accountability tool inc action plan,
outcomes from stakeholder perspective, involved others in process)
• Notting Hill* (ROCE by business stream, active asset management, good use of
G15 benchmarking and commentary)
* in OFR, ** separate VFM statement
Good Practice caveat:
• how consistent is HCA in its approach to assessment?
• up the ante - great expectations year 2
• smaller HAs – need a proportionate approach
Evidencing (measuring) VFM performance
A VFM scorecard - for self-assessment & general biz tool?
Process
Value
achievement
Value
VFM scorecard
People
Value
creation
Biz
health
•
•
•
•
limited set of common metrics
emphasis on performance not context
but should be considered –v- context
comparable evidence base for:
• credible VFM story
• understanding business effectiveness
• complements corporate scorecard (not always
metric-based)
Evidencing (measuring) VFM performance
+ local metrics, eg
= credible evidence base to
local offer
hang narrative on
+ qualitative evidence, eg
scrutiny, reviews, awards
to be revisited
What did HCA do?
Any evidence of
getting shirty with
smaller HAs?
• looked at around 240 self-assessments (ie 1000+ stock with March
year end)
• 15 non compliant – 14 downgrades
• 160 got a partial compliance (naughty) letter threatening potential
downgrade if no improvement
• why downgraded?
• insufficient assurance that there is a strategic approach to VFM
• not communicated to stakeholders in a transparent and timely manner (ie
missed deadline)
So key issue – the provision of sufficient evidence for HCA to be
assured
‘VFM self-assessment is about evidencing the VFM story….’
What has HCA been saying is good?: key
messages for 2014/15
• Good self-assessments transparently permit stakeholders to understand performance
against the specific requirements of the standard:
NB focus on 3 specific
sufficient detail to allow stakeholder to make own assessment
requirements
balanced commentary - a reasonable interpretation of results
clear info on ROA* and how this has been used to inform decisions on the management of the
asset base
• quantified evidence on cost of delivering specific services*, compared with:
• previous years
• relevant peer group
• & clear links between cost & quality of outcomes
• no cherry picking good stuff – consider cost & performance, strengths & weaknesses in
context of overall spend
• systematic evidence of past VFM savings and specific, ambitious, measurable targets for future.
Links made between savings & gains & achievement of provider’s overall strategy.
Matthew Bailes et al, spring 2014
* NB the principles of Regulatory Framework expect continuous improvement in use of assets and
costs. HCA is looking for ‘sufficient evidence’ to enable judgements on this
•
•
•
…..& poorer self-assessments…
..did not
The HCA’s key messages for 14/15
• signpost other key documents in your board report / OFR
• no room for complacency. For most what was good enough in 2013/14 won’t
be good enough next year. NB raising the bar
..the sector should not underestimate the government’s & regulator’s
interest in VFM……
• Matthew Bailes, May 2014: ask yourselves
• does the self-assessment give the reader enough information to make a
judgement on whether your organisation offers VFM in delivering your
objectives compared to your peers?
• does it give them enough information to judge whether you are doing
better or worse than last year?
NB continuous improvement in
VFM is about beneficial change
in cost &/or performance
WHAT MIGHT A VFM SELF-ASSESSMENT
LOOK LIKE?: THE PRINCIPLES
Key principles for self-assessment
• include a comprehensive VFM self-assessment in OFR/board report
• signpost to even more comprehensive documents if required – make
sure these documents are available and accessible in good time
• form & content of the self-assessment is based on HA’s social
purpose and stakeholder interests
• there is no template
• suggest narrative backed by evidence (eg data, qualitative info)
• no evidence = fairy story
• but just killer metrics – fails to tell full story
• VFM ultimately a qualitative judgement based on assessment of
available evidence
Key principles for self-assessment
• it is a stakeholder document – be clear about who you produce value for:
• what do they want and how much have you achieved for them?
• is it more or less than last year?
• invite challenge
• demonstrate board ownership of VFM – allow time for the board to consider,
discuss and challenge the self-assessment:
• do they understand it?
• does it address the requirements of the standard?
• is it robust?
• sufficient evidence/assurance
• any limitations or gaps – if so what and how will it be addressed
• does it represent a true & fair VFM story or just a fairy story?
Key principles for self-assessment
Key principles for self-assessment
• it should be robust and transparent
• comprehensive account of how the association is faring with regards to
improving VFM, warts & all , strengths & weaknesses, in the round
• evidence-based! - provide sufficient evidence for stakeholders to make
their own judgements – commentary should represent a fair and
balanced analysis of evidence facilitating judgement
• self-assessment is not a PR exercise but an accountability and
improvement tool
• it should be accessible to stakeholders
• infers that report is intelligible and its availability communicated to
stakeholders.
• data visualisation key
Key principles for self-assessment
Key principles for self-assessment
Content:
• consider including a compliance statement - to what extent does the HA
comply with the requirements of the standard and what does it plan to do
about areas on non/partial compliance?
• demonstrate
• a strategic approach to VFM including a robust approach to use of
resources
• the performance management & scrutiny arrangements to achieve
strategy (including governance and tenant scrutiny).
This is about demonstrating a grip on VFM via arrangements to ensure its
delivery
Key principles for self-assessment
Key principles for self-assessment
Address HCA’s specific requirements:
a) should enable stakeholders to understand the return on assets measured against the
organisation’s objectives – provide evidence that you have a grip on asset management - that you:
• understand stock condition & associated investment needs
• understand maintenance costs
• understand demand, the communities & markets you operate in
• understand the return in financial, social and environmental terms at an appropriate level
of detail: what level? What does the data tell you?
• demonstrate that the above understanding informs
• intelligent asset management strategy that aims to improve returns
• intelligent business decisions, eg hold, invest, dispose, convert, etc
• understand the benefit of investment on future rental stream/social outcomes & only
invest where the return is clear…..
• …consider brief assessment of key asset decisions over year – cost/benefit
• flag weaknesses for transparency, remedial action?
Key principles for self-assessment
Key principles for self-assessment
b) set out the absolute and comparative costs of delivering specific services and
demonstrate you understand service costs, cost drivers and associated outcomes, ie
that you have a grip on operational cost and performance.
• evidence here includes benchmarking data, business metrics and qualitative info
eg: tenant scrutiny, service reviews, accreditation, feedback.
• Acuity/HouseMark data key evidence base – compare self over time and against
others but avoid gaming
• brief commentary on headline unit costs, PIs, other evidence
• what can you do about your cost drivers?
• what are you doing to contain overheads?
• what can you say about the efficiency/effectiveness of operating model?
• strengths & weaknesses
• explain direction of travel – costs/value up or down
Key principles
for self-assessment
Key principles
for self-assessment
c) evidence of past and prospective VFM gains
• set key gains against overall cost base and in context of mission
• quantify the gain financially, socially (performance, satisfaction, # beneficiaries,
etc), environmentally
• how was it achieved?
• own up to any negative impacts, costs etc
• what will you use surplus for?
• future gains
• what will you do?
• what is the anticipated financial, social, environmental gains in context of
mission – can you quantify these?
• are there any costs or diminution in service associated with them?
• over-promise, under-deliver is a risk – self-assessment is a record
Dropping the principles into a template?
1. Overall summary statement
of VFM performance &
compliance with standard
2. Define VFM in context of
objectives & stakeholder
interests
Overall, we meet the requirements of
the standard…notable achievements
include x. We need to address y...
For us VFM means……
3. Provide assurance about
‘how you do’ VFM
Our arrangements for ensuring VFM are…
4. Evidence-based VFM
reporting (warts ‘n’ all) – ‘how
we did and what we plan to
do’
Narrative that draws on data &
qualitative evidence & addresses specific
HCA reporting expectations
You don’t
have to do it
like this!
to be revisited
Thoughts, observations?
Lunch
PART 2
Recap & agenda
Part 1: morning
• Introductions
• Regulatory context brought up to date
• Observations & lessons from Year 1
• What has the HCA been saying about year 2
• What might a self-assessment look like? – overview
Part 2: afternoon – 1:30 – 5:00
• What might a self-assessment look like? – the detail
• Some thoughts from me
• Some thoughts from you - looking back and forward
• Last thoughts
Exercise 1 – How was it for you?
In small groups, reflect on your organisation’s experience of
producing a VFM Self Assessment last year:
1.
2.
3.
4.
What kind of structure and evidence?
What worked well?
Outstanding difficult issues?
What lessons have you learnt?
Write brief flipchart notes
Be prepared to feedback as part of discussion
STEPPING THROUGH THE PROCESS
Dropping the principles into a template?
1. Overall summary statement
of VFM performance &
compliance with standard
2. Define VFM in context of
objectives & stakeholder
interests
Overall, we meet the requirements of
the standard…notable achievements
include x. We need to address y...
For us VFM means……
3. Provide assurance about
‘how you do’ VFM
Our arrangements for ensuring VFM are…
4. Evidence-based VFM
reporting (warts ‘n’ all) – ‘how
we did and what we plan to
do’
Narrative that draws on data &
qualitative evidence & addresses specific
HCA reporting expectations
You don’t
have to do it
like this!
Focus on step 1. Compliance & summary
statement, including board assurance

high level summary of VFM performance – key strengths and weaknesses,
is VFM improving?
How we did summary
by stakeholder?


compliance statement
 to what extent does the HA comply with the HCA’s VFM requirements?
 is the Board assured:
 this is a fair and balanced account of VFM?
 of the robustness of this self-assessment
 sufficient evidence/assurance?
 limitations or gaps?
 how will non-compliance be addressed?
invite feedback & challenge by stakeholders
Issues? Solutions?
Focus on step 2. What VFM means to
us: our VFM definition
• assert social mission, vision and objectives - it’s why you exist!
– unpack key ‘value streams’ (outcomes), ie new homes, great services,
community well-being, care & support
• identify key stakeholders and what they value – your audience &
beneficiaries of your value!
• based on above, assert a short VFM definition - essentially ‘for us
VFM is maximising ‘our value’: more homes, better services, more
lives improved…….’
• great opportunity to boldly assert your value proposition
Focus on step 3. Arrangements to ensure
VFM – a strategic approach & the means to
deliver it
• to demonstrate grip on VFM strategically and
operationally
• set out key principles of VFM strategy - state that it is
a considered strategy, eg:
• based on fact/previous assessment
• has meaningful improvement actions linked to it (pick
these up in step 4 when reporting past/future gains!)
• corporate fit with key strategies: risk, asset, people,
procurement etc.
• no VFM strategy ? - consider how the biz strategy
drives biz effectiveness/VFM
If you have a VFM strategy this is where it probably fits?.....
Operations
Strategic planning
VFM Self
Assessment
Purpose,
objectives …
Corporate
strategy
Financial
plan
VFM strategy
People
strategy
Asset
strategy
VFM action
plan
Procurement
strategy
Service
delivery plan
Focus on step 3. Arrangements to ensure
VFM – a strategic approach & the means to
deliver it
What can you say about how you ensure the right amount
of money is spent on the right things (social biz
objectives)?:
o rigour of business/corporate planning process
o use of robust business cases - based on
evidence/data (and not historical costs) &
understanding of benefits
o quality of debate and challenge
Focus on step 3. Arrangements to ensure
VFM – a strategic approach & the means to
deliver it
• governance & performance management arrangements associated with
planning, delivery and evaluating VFM eg:
• VFM roles of board, exec, other staff, tenants, eg
• respective roles in accountability & challenge
• tenant involvement in VFM: agreeing priorities, shaping services &
scrutinising service performance and VFM
• assurance and reporting framework for VFM eg
• how is VFM reported within the HA?
• how is VFM measured? Which tools?
• extent VFM is embedded, eg performance management, cost control,
procurement practice, etc
• strengths & weaknesses of your approach?
Issues? Solutions?
Step 4. How we did & what we plan to do
VFM
scorecard/metrics
as evidence base to
hang story on
Alternatively
take each
corporate
objective in
turn.
+
Assets
Operations
Procurement
Treasury
Surplus & intended use
Pithy commentary
on key activity areas
supported by
evidence
Step 4. How we did & what we plan to do
a) Provide evidence that you have a grip on asset management ie that you:
•
•
•
•
understand stock condition & associated investment needs
understand maintenance costs
understand demand, the communities & markets you operate in
understand the return in financial, social and environmental terms at an appropriate
level of detail: what level? What does the data tell you?
• demonstrate that the above understanding informs
• intelligent asset management strategy that aims to improve returns
• intelligent business decisions, eg hold, invest, dispose, convert, etc
• understand the benefit of investment on future rental stream/social outcomes & only
invest where the return is clear…..
• …consider brief assessment of key asset decisions over year – cost/benefit
•
pick up past improvement actions – quantify gains/benefits
•
strengths and weaknesses of current approach to assets
Step 4. How we did & what we plan to do
a) operations
• set out the absolute and comparative costs of delivering specific services (use
HouseMark VFM dashboard & quadrant /Acuity metrics to compare self over time and
against others)
• other evidence here includes business metrics, local offer data, care indicators and
qualitative info eg: tenant scrutiny, service reviews, accreditation, feedback.
• brief commentary on headline unit costs, PIs, other evidence
• what can you do about your cost drivers?
• what are you doing to contain overheads?
• what can you say about the efficiency/effectiveness of operating model?
• strengths & weaknesses
• explain direction of travel – costs/value up or down
• highlight key VFM initiatives and (quantified) benefits, eg from VFM register, previous
VFM action plan, movement in HouseMark/Acuity data
• how were they achieved?
• set gains against overall cost base. Own up to any negative impacts, costs etc
•
ROI of commercial activity
Step 4. VFM achievements
c) key procurement gains not already covered at a) or b)
d) treasury management
 brief ref to the cost of capital, debt management strategy and any evidence
of savings from active debt management. How does the cost of capital
compare?
 use made of borrowing capacity to achieve development outcomes in
context of:
o board’s agreed approach to risk and future business plans
o limitations:
 covenants
 access to affordable finance
NB this is about managing stakeholder expectations as much as reporting
VFM
e) state surplus & how gains/surpluses will be used to produce more VFM
Issues? Solutions?
What I’ve just said as a picture
Narrative
backed by
data
costs –v- service outcomes, social &
economic benefits, environmental benefits
Assets
Operations
It’s all social
value!
Procurement
financial
benefit savings,
income, etc
Treasury
Management
financial
benefit savings,
income, etc
Surplus
Borrowing
capacity
looking ahead – even
more social value
Data sources/evidence base
VFM strategy & action plan
benchmarking/HCA regression analysis
internal scorecard
key asset management
local offer performance
decisions – cost/benefit
impact assessments,
Assets
Operations
SROI, etc
satisfaction
Procurement
key procurement items
tenant scrutiny work
– cost/benefit
accreditation, service review, internal
audit, etc
Treasury
Management
Financial returns
Surplus
Borrowing
capacity
VFM register
Step 4 variation based on corporate plan
• corporate objective #1
– aim
– achievements
– plans
• corporate objective #2
– ditto
Caveat - but need to ensure don’t lose sight of
regulatory requirements by following the line of
thinking in your corporate plan
Step 4. Improvement Plans for next year
• what will you do?
• pick up weaknesses, improvement actions already
identified – your VFM action plan going forward
• what is the estimated (quantifiable) benefit in
financial, social and environmental terms
• pick up weaknesses mentioned elsewhere
• any costs or diminution in service associated with them?
Issues? Solutions?
….and don’t forget to communicate
• disseminate
•
•
•
who?
OFR/board report! signpost
timeliness
• accessible
•
•
find it?
understand it?
• language
• graphics
EVIDENCING (& MEASURING) VFM
Evidencing (measuring) VFM performance
A VFM scorecard - for self-assessment & general biz tool?
Process
Value
achievement
Value
VFM scorecard
People
Value
creation
Biz
health
•
•
•
•
limited set of common metrics
emphasis on performance not context
but should be considered –v- context
comparable evidence base for:
• credible VFM story
• understanding business effectiveness
• complements corporate scorecard (not always
metric-based)
Evidencing (measuring) VFM performance
+ local metrics, eg
= credible evidence base to
local offer
hang narrative on
+ qualitative evidence, eg
scrutiny, reviews, awards
What kind of metrics?
Process
% rent collected
% service charge collected
average re-let time (all voids)
calls handled at first contact
or another key customer process PI
repairs at first visit/equivalent
satisfaction or net promoter with employer?
or staff engagement?
sickness absence
staff turnover
ratio top earner to bottom or median earner
measures on say board effectiveness or staff
development?
People
Value
net increase in stock
satisfaction with new home
net promoter/satisfaction with service
satisfaction with repairs
satisfaction with neighbourhood
% tenants who think rent/service charge is good
VFM
#/% beneficiaries – employment?
#/% beneficiaries - training & education?
#/%/£ beneficiaries – income inclusion?
growth turnover
net increase in stock
operating margin
operating costs as % turnover
• management, maintenance, development overheads
non-social housing turnover
% spend non-social
% margin non-social
arrears as %
Biz
void loss as %
bad debt as %
health
effective interest rate
leverage
Building a picture of value with metrics
Social mission
•identify kind of value
•new homes (V1)
•great tenant services (V2)
•care & support (V3)
•added value (V4)
•commercial return?
Kind of value
Kind of objectives
Kind of measures
Metrics need
to map to
value
•map existing metrics
•fill gaps
•metrics
•other forms of evaluation
•reviews, awards etc
•tenant scrutiny
•impact studies
Telling the
story: where
the value lies
Complement metrics
with key reviews,
awards, scrutiny,
impact studies, social
accounts?
Customer
Satisfaction with quality of new home* V1
Satisfaction with overall services provided* V2
Satisfaction with maintenance* V2
% jobs right first time V2
Net promoter* V2
Fuel poverty PIs?
Your key Care &
support PIs (V3)
could be
included here
too eg QAF.
Average SAP rating* V2/4
Satisfaction neighbourhood * V2/4
•# found employment V4
•# apprenticeships created V4
•# completing training course V4
•# provided financial advice V4
•satisfaction with intervention V4
•£x invested of own money
•£y leveraged
NB NHF audit categories as basis for
typology
Community &
LA
• Key local promise PIs (in accordance
with consumer regulation) V2
• Arguably, surplus, leverage
• Net increase in stockV1
• Regulatory rating
Regulator &
government
Developing a VFM scorecard toolkit
Metrics in blue
collected by
Acuity
Don’t panic!!!!!
I’m not suggesting you use all of the following metrics –
simply pick the best that work for you depending on:
a) the nature of your business and the value you produce
b) how much effort you want to put in
Business health
source: accounts, Acuity, HouseMark
• business growth
• operating efficiency & profitability
– margin eg
– growth in turnover
• operating margin
– growth in assets
• EBITDA MRI margin
– operating cost per unit
– net increase in stock
• management cost
– new biz income
• maintenance cost
• debt servicing & use of assets
– income protection
• arrears as % rent due
– net leverage/gearing
• FTA as % rent due
– debt per unit
• void loss as % rent due
• bad debt/write off
– EBITDA MRI interest cover
– effective interest rate
– return on assets
Clearly lots more to choose from but what do you think are the key metrics?
People
source: local PIs, Acuity, HouseMark
•
•
•
•
average days lost to sickness
staff turnover
staff/board satisfaction
could consider:
– customer service accreditation
– local measures associated with training and
developing staff
Clearly lots more to choose from but what do you think are the key metrics?
Business processes
source: local PIs, Acuity, HouseMark
•
•
•
•
•
•
•
•
% rent collected
% service charge collected
% repairs completed in target time
% units vacant & available
% units vacant & unavailable
average re-let time
tenancy turnover
other key processes where effectiveness matters, eg gas
safety, ASB case handling, budget achievement?
Clearly lots more to choose from but what do you think are the key metrics?
Value
source: local
PIs, Acuity,
HouseMark
Complement
metrics with
reference to any
key impact studies
Customer
Satisfaction with quality of new home* V1
% homes failing Decent Homes Standard* V2
Average time to complete a repair* (days) V2
Satisfaction with maintenance* V2
Satisfaction with overall services provided* V2
% jobs right first time V2
Net promoter* V2
% tenants who think rent/service charge is good VFM V2
Satisfaction with outcome of complaint V2
% satisfied with complaint handling V2
% satisfied staff were able to deal with their problem V2
Average SAP rating* V2/4
Your key Care &
support PIs (v3)
could be included
here too eg QAF.
Satisfaction outcome of ASB case* handling V2/4
Satisfaction with neighbourhood as a
place to live* V2/4
Typically the most frequently used measures are #
beneficiaries of a given intervention, eg
• # tenants provided with financial advice
• # tenants helped into sustainable work
• # tenants completing vocational training course
• # tenants completing skills training
• # apprenticeships created
• # kids attending diversionary activity
Can also include satisfaction with intervention
Also:
• £x invested of own money
• £y leveraged
Community
& LA
Percentage of tenants who are satisfied that
views are listened to and acted upon* (co-reg) V2
• Include any key local promise PIs in accordance
with consumer regulation V2
• Net increase in stockV1
Regulator &
government
Exercise 2: What should it look like?
In the same groups, based on what you’ve heard and the suggested
templates, what should it look like?:
1.
2.
3.
4.
What kind of structure?
What kind of evidence?
How would you improve it to make it your own?
Remaining difficult issues?
Write brief flipchart notes
Be prepared to feedback as part of discussion
Last thoughts, issues
• have you got the tools and information you need to take this
forward?
• anything not dealt with?
• consider a buddy system for peer challenging your SAs
• Acuity support also available
Steve Smedley 07814 424426
[email protected]

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