An innovative framework agreement between Xerox Global Services and the North West Collaborative Procurement Hub is set to enable potentially huge savings for the NHS Trusts in the North West.
The health service in this region stands to make huge cost savings following the signing of a landmark framework agreement between Xerox Global Services (XGS) and the North West Collaborative Procurement Hub, designed to streamline the entire print management process for the hub’s 47 Trusts. Up to now hospital Trusts and other NHS organisations have been largely unaware how much they actually spend on printing contracts.
“Identifying print costs in the Trusts is a significant challenge,” says Trevor Ingham, Senior Category Manager for Office and IT at North West Collaborative Procurement Hub. “It’s a grey area in the Trusts and no one really knows what their print costs are. They might know how much they spend with a supplier, or how much they spend on toner cartridges, but not the real, overall cost. We really wanted to streamline our print management process and costs.”
“If a Purchasing Department in a hospital spends a lot of time buying printer cartridges then we say to them, ‘That’s not a good use of your time – we can do that for you,’ and then they utilise their time buying MRI scanners and things that really matter to patient care,” says NHS Account Manager for XGS, Andrew Wade.
Procurement in the NHS is now organised into regional bodies known as Collaborative Procurement Hubs, which broadly align with the 10 Strategic Health Authorities established in 2006. The hubs are quasi-commercial organisations that manage, influence or control nonpayroll spend in the NHS.
“Instead of going straight to the Trust we deliver via a framework agreement negotiated with a hub,” says Andrew Wade. “We have a framework agreement in place with the pathfinder hub, Yorkshire and the Humber, where we deliver our services to member Trusts. Building on that, we’ve now formed another agreement with North West Collaborative Procurement Hub, which has 47 members, and this is a model which is being followed closely by other hubs. Potentially this model will cover a significant percentage of the UK, but we’re not there yet. This is groundbreaking stuff.”
So how does it work in practice? “We deliver managed document services and take over full responsibility for procuring and delivering document output,” says Andrew Wade. “Hospitals are built on paper – vast mountains of the stuff, and it’s still increasing despite everything you might hear about the paperless office. Health records are paper-based – every procedure involves forms to be filled in, consents to be signed and notes to be taken.”
Trevor Ingham agrees. “This really is a huge problem in the NHS,” he says. “Hospitals will buy 10,000 forms because it’s cheapest to do it that way and they’ll then sit on the shelves in storage departments until they become obsolete.”
“We don’t do that – there’s a whole philosophical difference,” says Andrew Wade. “It goes right down to the basics of ‘print less paper’. Our philosophy is ‘print to use rather than print to store’.”
Clearly, it’s not just cost savings that are at stake here – there’s also the sustainability agenda. The NHS, as the biggest employer in the country, is under intense pressure to lead by example on environmental and sustainability issues. “You can’t underestimate how important this is,” says Andrew Wade. “It’s coming down from Whitehall and is really reaching ground level now – the Trusts are really having to face up to this. The chief executives are being tackled on it on a weekly basis.”
This sustainability agenda in the NHS covers everything from sourcing food from local suppliers and encouraging sustainable transport to the energy efficiency of buildings and equipment. Perhaps ironically, given their heritage, Xerox actually encourages the Trusts to use less equipment and paper in the office.
“You can go into an NHS building and every desk has a printer on it, which is extraordinary,” says Andrew Wade. “Most are never used, or used one per cent of the time – think about the wasted energy of equipment being left on standby, think about the carbon footprint, think about disposal. We encourage hospitals to use less equipment – we found that a typical hospital has one-and-a-half people per piece of hardware. In terms of best practice in the private sector, we would expect to find 20 workers per device.”
“So, ironically, our thrust is to use less equipment in the office space – we optimise office copiers, PC printers, fax machines. We try and supply the means to produce fewer documents, and for documents that are not done inhouse we manage the external production. Our commercial offer is that we will deliver guaranteed savings to the Trust.” XGS also makes sure that when placing print work outside it uses local suppliers wherever possible as long as they meet the company’s and the Trust’s
So how has all of this gone down with the hubs and the Trusts themselves? “It’s irresistible, because you’re talking about significant cost savings,” says Andrew Wade. “At board level there’s no problem at all, but elsewhere there can be challenges in the need for change.”
This framework is in fact the result of 12 months of negotiations between the hub and XGS. “The challenge was coming up with a contract that was robust enough for us to introduce it to our members,” says Trevor Ingham. “Now that we’ve got a deal on the table, it’s about getting the compliance and take up across our members.”
“This is a completely new concept in the NHS – a managed service around print,” he continues. “But it’s not a new concept in the private sector. Xerox has numerous multinational and blue-chip companies that are already using the managed service. We got on board when we heard about the exercise in Yorkshire and the Humber, but in the 12 months since then there are many other Collaborative Procurement Hubs or NHS organisations that look like they’re starting to see the benefits.”
The framework was finally signed in June. “Xerox came through a stringent procurement exercise and a clear evaluation process and were the only company that we trusted to offer a robust managed service,” says Trevor Ingham. “Placing the contract is only the start. We can really forecast significant benefits.”
The next step is for Xerox to carry out due diligence, working with the Trusts for a number of weeks to identify costs, which will itself be a significant piece of work, says Trevor Ingham.
So does Andrew Wade have any doubts about convincing Trust managers about the benefits? “We have to convince them that the transformation will pay off,” he says. “But at the end of the day it’s simply that the money we save can be spent on patients.”