ICFP & Procurement - Why should you care
Introduction - skip if you know about ICFP
Integrated Curriculum and Financial Planning (ICFP) is a management process that helps schools plan the best curriculum for their pupils with the funding they have available. It can be used at any phase or type of school.
The idea of linking curriculum and financial planning is not new. Most schools probably use some ICFP processes already when reviewing their curriculum or financial strategy.
For more information on ICFP please visit this gov.uk page.
What we are focussing on - delivering ICFP through non-staff costs
At Cimple, we are supporting MAT leaders in delivering one of the four specific components of ICFP which is the analysis and improvement of non-staff costs through procurement.
One of the key known challenges with ICFP is how MATs and Schools should be delivering improvements to their ICFP through non-staff costs. There is great detail on how to measure, forecast, plan and action integrating learning outcomes with staff costs. However, non-staff costs often feel like a side point that is less integral due to being on average 75% of school spend. (1)
Why procurement is important
There are two key ways to deliver non-staff costs efficiencies in all types of organisations covering:
Demand based levers (i.e. managing demand to reduce costs e.g. switching off light switches to conserve energy use); and
Price based levers (i.e. reducing cost through renegotiating prices or reducing price variance).
ICFP for non-staff costs is focussed on delivering non-staff costs efficiencies through both levers. We now go into more detail about the importance of these levers and what to do about them.
Demand based levers
Critical to creating efficiencies is being able to manage demand across a MAT or School in line with the curriculum and staff related costs. Demand management comes in many forms covering:
Stopping demand where latent demand or ‘overstocking’ can be identified
Managing demand through tighter governance processes e.g. spending levels
Aggregating demand through consolidation of spending e.g. buying the same text books
The output of this activity can then inform key procurements of non-staff costs.
Price based levers
Price based levers are the ability for a MAT or School to deliver price efficiencies through transactional purchasing or procurement activity.
At the point of purchase/procurement levers that can be pulled are:
Increased competition through including more suppliers
Use of frameworks/dynamic purchasing systems where pre-agreed pricing is agreed
Aggregation of demand to offer economies of scale
Some of the key challenges
School procurement or purchasing can often feel like a dark art and is complex to deliver. It doesn’t help that schools are governed by Procurement Regulation and that the procurement landscape in the UK is complex and opaque.
Some of the key challenges faced by MATs and Schools in relation to procurement are:
Setting out a clear requirement for more complex procurements
Understanding the best route to market i.e. a direct procurement vs using a framework and which one of the many frameworks to use
Managing a procurement process to deliver best value out of the activity
Making sure that both demand and price levers are pulled through the process
Maintaining compliance to EU procurement law, a particular risk in that new UK Procurement Law is about to be actioned
All of this whilst helping to reduce carbon emissions to deliver Net Zero
How to deliver ICFP through non-staff costs
Key to success is helping to model out potential non-staff efficiencies that can be created but also then forecast demand changes based on e.g. increases in pupil numbers or growth in the MAT through acquisition of new schools. A great opportunity for this is at the point of contract renewal for major areas of spend e.g. Facilities Management, ICT Provision, Energy Supply or Catering Services.
This can be done through two phases covering analysis and then delivering action.
To start with, a clear understanding of spending is required for a school or MAT. The best place for a historical view of this is within the schools finances that should give a view of the non-staff spend breakdown as well as a forecast from the future budget
Analysis of this spend will ‘categorise’ spend into specific areas e.g. catering, facilities, stationary. This should provide insight into:
Whether more than one supplier is being used for the same thing and if there is a price difference
If a supplier is being used for something consistently but the pricing differs (i.e. price variance for the same good or service bought on separate occasions)
If a supplier is being used for elements of catering that could be brought into an overall catering contract
All of these provide opportunities to drive efficiencies in non-staff costs through future action.
On the back of the analysis this should identify a number of opportunities to drive efficiencies either that are price led or demand led. The price led options can then be delivered through purchasing or procurement activity either through:
Low value purchases - getting 3 quotes to maintain compliance
Higher value procurements - running competitions through an existing framework or through a compliant procurement process
How Cimple can help
All of the above likely has left a lot of questions unanswered and is resource heavy to deliver. In particular, lots of activity is done manually over email.
This is where Cimple can help. We can firstly, through our delivery partners, help you with an end-to-end efficiency programme to deliver the above. We work with specialists who understand the Education sector specifically and its challenges.
Secondly, we have free to access purchasing tools that will enable you to run your purchases and procurements all in one place. You can access DfE frameworks and run procurements from those frameworks on our platform. Part of our solution is giving you access to the management information you need to understand performance in your School or across your MAT.
To find out more about how we can help please contact firstname.lastname@example.org.