As part of the planning phase and in line with good practice in project management, commissioners should prepare a thorough risk assessment with risk management strategies to mitigate the impact of any risk occurring. The risks considered should be risks to the decommissioning process itself and include risks to value for money, costs, slippage, and reputation, and risks to users, providers and statutory agencies.
This Practical example shows some of the negative impacts that poor risk assessment can lead to.
Practical example – The effect of poor risk assessment during decommissioning
A local authority decided to decommission an advice service because it felt that the current provider was not delivering effectively and the contract was coming towards an end anyway.
The local authority decided that it would re-tender for the advice service. However, the local authority did not consult the existing provider about this decision and, with only a limited assessment of need carried out to inform the re-tendering process, a revised specification was released which asked for a level of service delivery far in excess of the existing service and with a significantly reduced budget.
This change of direction took the provider sector by surprise and most regarded the specification to be both over-ambitious and uneconomic. The result was that the commissioner only received two tender responses, both of which did not meet the requirements of the new service. In light of this poor response and again without any consultation with the local third sector, the local authority decided to move the service in-house, which led to significant recruitment and infrastructure costs.
The lack of a comprehensive needs assessment and analysis of the local provider market, combined with poor consultation with the sector, led not only to increased costs for the local authority – which had to take a service back in house at increased cost – but also to reduced trust and poor working relationships with the third sector organisations.