Medirest and The Royal Surrey County Hospital

Medirest and The Royal
Surrey County Hospital
Partnership Paper
January 2015
MEDIREST PERFORMANCE WITH HEART
HOW OUTSOURCING NONCLINICAL SERVICES CAN HELP
NHS TRUSTS IMPROVE COST
EFFICIENCY AND PERFORMANCE
THE ROYAL SURREY COUNTY HOSPITAL
PARTNERSHIP: BENEFITS AT A GLANCE
Real-world ‘success factors’ from The Royal Surrey County
Hospital show how NHS Trusts can improve performance
and reduce operating costs by transitioning non-clinical
services to a specialist private-sector partner.
• 10% cost savings across key outsourced soft FM
services (housekeeping, and portering), representing total annual cost savings of £179,000
EXECUTIVE SUMMARY
• Increase in patient satisfaction to 92%
within housekeeping services (Internal Medirest
Patient Surveys)
• 10% performance improvement for housekeeping (internal audit)
•
£1 million invested to build a new Marks &
Spencer Simply Food store and larger Costa Coffee
store at the entrance to the hospital, generating additional annual income of £110,000 for the Trust
• £160,000 invested to improve and re-brand
the staff and visitor restaurant.
• £90,000 invested to build a new, on-site
laundry facility
• £100,000 invested in new equipment for
the housekeeping team
• £10,000 invested in new logistics software
to enhance the portering service
With budgets under greater pressure
than ever, increasing numbers of NHS
Trusts are looking to outsource nonclinical services as a way to increase
efficiency and achieve operational cost
savings. However, board-level concerns
about private-sector partnerships
and complex public-sector tendering
processes can hold outsourcing
projects back.
For Trusts that can overcome these
common challenges, though, the benefits
of outsourcing non-clinical services are
compelling. Not only can Trusts leverage
the specialist skills and experience of
private-sector partners and eliminate
distractions to the core business of
providing excellent patient care, they
can also implement robust Service Level
Agreements (SLAs) for service quality
and achieve significant operational
cost savings based on delivering best
practices, improved staff training and
state-of-the-art equipment.
Savings generated by outsourcing
can help overcome growing financial
pressures on hospitals in the UK and
allow these funds to be invested in
front-line resources – in particular,
additional nursing staff. Key to this
is that both the hospital and service
provider must achieve financial and nonfinancial benefits as a result, and work in
partnership over the long term to achieve
shared goals.
In this paper, we look at seven ‘success
factors’ that can help NHS Trusts build
successful strategies for outsourcing
non-clinical services and maximise the
cost and performance benefits on offer.
The success factors are based on realworld experiences at The Royal Surrey
County Hospital, which has achieved
significant performance improvements
and cost savings by transitioning key soft
FM services to Medirest, the healthcare
services arm of Compass Group.
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MEDIREST PERFORMANCE WITH HEART
SUCCESS
FACTORS FOR
NON-CLINICAL
OUTSOURCING
IN THE NHS
“If Medirest had
pitched their proposal
directly to the Board, we probably
wouldn’t have made any progress with
outsourcing our soft
FM services.
My role as Director of Organisational
Transformation was critical for convincing
senior people that outsourcing was in our best
interests. It also showed the Board that we were
fully in control of the negotiations with Medirest,
both in terms of defining the vision and scope
for the outsourcing strategy and also for setting
SLAs and cost-saving requirements as well.”
Alf Turner
Director of Organisational
Transformation, The Royal Surrey
County Hospital
ACHIEVING BUY IN FROM KEY STAKEHOLDERS
Ideological and political
opposition to outsourcing is still
common in the NHS, even for
non-clinical services. To build
a strong, effective outsourcing
strategy, key decision makers
must effectively communicate
the benefits across all levels of
the organisation.
LESSONS FROM THE
ROYAL SURREY COUNTY HOSPITAL
The Royal Surrey County Hospital’s
Director of Organisational
Transformation Alf Turner provided
the strong internal sponsorship and
leadership needed to ensure success
for this landmark, first-generation
outsourcing project.
“Like me, most of the Board members at
The Royal Surrey County Hospital come
from a commercial background and fully
understand the benefits of outsourcing nonclinical services for increasing operational
efficiency and performance,” says Turner.
“That made my job much easier when it
came to making the business case
for outsourcing our soft FM services
with Medirest.”
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The Medirest team supported Turner
with an in-depth financial analysis of
current services and detailed projections
for likely cost savings. “The Medirest team
helped me build a strong, evidence-based
business case for extending our non-clinical
outsourcing contracts,” says Turner. “All that
good work fed into multiple presentations to
the Board, which ultimately helped us get
this important project underway.”
Alf Turner’s strong leadership led to
a two-year extension of existing nonclinical outsourcing contracts with
Medirest and a ten-year extension to The
Royal Surrey County Hospital’s existing
retail concession contract under which
Medirest is investing £1 million in a new
Marks & Spencer Simply Food store and
larger Costa Coffee store, which will be
built at the entrance to the hospital.
The Royal Surrey County Hospital has
also incorporated a number of additional
soft FM services into its existing
Medirest soft FM contact, including
housekeeping, portering, night-time
security and switchboard services –
all previously delivered in-house by
internal teams.
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MEDIREST PERFORMANCE WITH HEART
“The new
M&S Simply Food
and Costa Coffee store
will dramatically improve the
appearance of the hospital and
provide a better experience for
staff, visitors and patients. The Trust
will also share in a dramatic uplift in
revenues from retail sales.”
“The onus is on Trusts to benchmark current
delivery models and demonstrate that
outsourced services will be at least as good,
if not better, than they are currently, and that
outsourcing non-clinical services will provide
measurable financial benefits. If you can
demonstrate the benefits beyond any doubt,
anything is achievable.”
Alf Turner
Director of Organisational
Transformation, The Royal
Surrey County Hospital
Alf Turner
Director of Organisational Transformation, The
Royal Surrey County Hospital
LONG-TERM INVESTMENT AND
SHARING FINANCIAL REWARDS
To maximise potential
outsourcing benefits, hospitals
must choose partners who
are prepared to make major
investments in service delivery
and share financial rewards
fairly with the Trust.
LESSONS FROM THE
ROYAL SURREY COUNTY HOSPITAL
Under the terms of The Royal Surrey
County Hospital’s extended retail,
catering and soft FM contracts, Medirest
will make major investments to improve
service quality and create revenue
growth for the hospital. This is reflected
in a true partnership agreement whereby
profit based on sales in retail and
operating profit in the FM services will be
shared between Medirest and The Royal
Surrey County Hospital.
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Chris Minter, Contract General Manager
at Medirest, says, “We are investing £1
million in the new Marks & Spencer Simply
Food store and new, larger Costa Coffee
store and hundreds of thousands to refurbish
the staff and visitor restaurants, build the
new on-site laundry and provide new
equipment for the housekeeping team. All
this investment demonstrates our ongoing
commitment to the Trust, and the fact that
we are sharing the financial returns from our
retail, catering and soft FM contracts with
The Royal Surrey County Hospital will help to
ensure that our relationship continues to go
from strength to strength.”
Medirest’s commitment to partnership with
The Royal Surrey County Hospital is already
delivering significant benefits for the Trust
and will pave the way for future outsourcing
opportunities, says Alf Turner. “We have
a really good, healthy, mutually beneficial
partnership with Medirest,” he comments.
“Everyone has to make money, but Medirest
puts quality first, and that is what ultimately
makes our business relationship successful.”
BENCHMARKING THE COST OF IN-HOUSE SERVICES
With in-house services, it’s
often impossible to accurately
benchmark spending and
drill down, for example, to the
cost of cleaning a particular
ward or buying chemicals.
To empower Trusts to create
detailed specifications for
outsourcing contracts and
properly assess supplier
proposals, effective cost
analysis must be undertaken
for existing, in-house services.
LESSONS FROM THE ROYAL
SURREY COUNTY HOSPITAL
Medirest helped The Royal
Surrey County Hospital to
benchmark all its existing
services in terms of processes
used, tasks carried out and
overall service delivery costs.
This made it possible to create
a detailed scope of work
for the extended Medirest
contract and to set realistic Key
Performance Indicators (KPIs)
for performance improvement
and cost saving.
“We have started reporting on
performance in areas where no
data previously existed,” says
Minter. “The housekeeping
operation, for example, was
audited just two months after
handover, showing an impressive
performance improvement
compared to the previous, inhouse service. Housekeeping staff,
switchboard staff and porters now
have clear performance targets
that they understand and strive
to achieve.”
Now that The Royal Surrey
County Hospital has gone through
this process with Medirest,
outsourcing additional non-clinical
services will be far easier and
quicker in the future, and the
Trust will also be able to accurately
assess the commercial benefits of
future proposals.
“Before, it was impossible to
accurately calculate the cost
of completing a particular task
or delivering a service – the
management information just
didn’t exist,” says Turner. “Working
with Medirest, we benchmarked
our previous, in-house services,
which has allowed us to accurately
calculate cost savings achieved
through outsourcing. We also
have a solid platform for creating
detailed outsourcing Request for
Proposals (RFPs) in the future and
for evaluating partner proposals.”
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MEDIREST PERFORMANCE WITH HEART
MITIGATING QUALITY RISKS
Soft FM services directly support core clinical
services and impact the patient experience and
are therefore mission-critical for Trusts. Before
taking a decision on outsourcing non-clinical
services, Trust executives must be satisfied
that private-sector partners are able to deliver
consistently high-quality services that effectively
support core frontline activities.
LESSONS FROM THE ROYAL SURREY COUNTY HOSPITAL
“We are healthcare experts, not
housekeeping or portering experts. We chose
to transition our soft FM services to partner
with Medirest because these kinds of services
are core to what they do. Their specialist
skills and experience have helped us achieve
performance improvements and cost savings
that would otherwise be impossible.”
Alf Turner
Director of Organisational Transformation,
The Royal Surrey County Hospital
Key decision makers from
The Royal Surrey County
Hospital visited King’s College
Hospital in London, where all
the housekeeping services are
provided by Medirest. King’s
sets very high standards
for cleanliness, and is an
excellent example of what
can be achieved with proper
management supervision,
staff training and the latest
equipment.
Simon Kruger, Sales Director
at Medirest, says, “To ensure
they are getting the best from
their outsourcing partners, NHS
Trusts need to know what ‘good’
looks like. Decision makers
from The Royal Surrey County
Hospital were very impressed
by their experience of visiting
King’s College Hospital and they
could quickly see how working
with a specialist housekeeping
partner such as Medirest could
help them achieve significant
performance improvements.”
At The Royal Surrey County
Hospital, contractual
remuneration is also based on
SLA compliance, which is a
further driver of excellent service
quality. “Our livelihood as a
company depends on our ability
to deliver to incredibly high
standards,” says Kruger. “It is
central to everything we do.”
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Turner says, “There is a
commonly held belief that
housekeeping and portering
shouldn’t be outsourced
because they directly impact the
patient experience. However,
our experience shows that
outsourcing these services to a
trusted partner such as Medirest
can help improve service quality,
both through specialist skills
and experience, and improved
management supervision.
Outsourcing partners can also
implement SLAs and KPIs for
service delivery where none
previously existed, dramatically
increasing quality and
accountability.”
To deliver the highest
standards of service quality,
Medirest set up a new
management team to oversee
operations at The Royal
Surrey County Hospital. This
included dedicated managers
to support housekeepers,
porters, switchboard and
security teams. In addition,
a dedicated HR and training
co-ordinator was appointed
to drive learning and
development and contribute
to long-term improvements in
service quality.
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MEDIREST PERFORMANCE WITH HEART
EFFECTIVE EMPLOYEE ENGAGEMENT
Typically, staff think that moving from their NHS
employment contract to a private employment
contract will negatively affect their pay, job
security and pension, which can delay or
ultimately put Trusts’ non-clinical outsourcing
plans in jeopardy. To allay the fears of team
members and keep projects on track, Trusts
and their outsourcing partners must work
together to engage all affected staff members.
NEW OPPORTUNITIES FOR CAREER DEVELOPMENT
LESSONS FROM THE ROYAL SURREY COUNTY HOSPITAL
Bev Budd, Regional HR
Manager at Medirest, says,
“Working with The Royal Surrey
County Hospital HR team, we
set up a programme to dispel
the myth that people’s benefits
and pensions would be changed.
We also took the opportunity
to talk to staff about Medirest,
and how transitioning to us
would improve their working life
based on improved management
support, the introduction of new
equipment and the provision of
new training and future career
development opportunities.”
One member of staff who was
transferred to Medirest was
Maria Rana, head of The Royal
Surrey County Hospital’s
135-strong housekeeping
team, who had worked in the
NHS for more than 30 years.
“I wasn’t sure how moving
to Medirest would impact my
working life and my team was
worried about how their jobs
would be banded and how their
pay would be affected. When
it came to it, though, a joint HR
team from The Royal Surrey
County Hospital and Medirest
did an excellent job of explaining
what would happen when
the contract started, how our
terms and conditions would be
protected by TUPE, and how we
would be supported through
the transition.”
In total, 198 members of
staff were transferred to
Medirest under TUPE terms
and conditions, protecting
their pay and benefits. “In
terms of mobilisation and the
TUPE process, Medirest had a
tried and tested approach that
minimised risk for us,” says
Turner. “We felt that the team
had seen and done it all before,
and that they knew more about
it than we did, which was
very reassuring.”
Alf Turner says, “Working
jointly on HR issues was
critical to the success of this
project. I managed major staff
announcements and union
meetings, while Medirest
helped staff understand what
the changes would mean for
them during roadshows, dropin sessions and other events.
At the outset, we said that we
would protect staff through
the transition and that’s exactly
what we did.”
To optimise staff engagement
at The Royal Surrey County
Hospital, the Trust and
Medirest joined forces to form
a single, integrated Human
Resources (HR) team.
“There were some people in our
organisation who didn’t believe that we
could achieve significant cost savings
without making negative changes to
people’s contracts and wages. That
isn’t the kind of Trust we want to be –
we gave our word to protect our staff
and we’ve done it.”
Alf Turner
Director of Organisational Transformation,
The Royal Surrey County Hospital
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For Sarah Carr, the transfer to Medirest was careerchanging. “When I was a direct NHS employee I worked
on the switchboard and I felt there was nowhere I could
really go from there,” she says. “Once I had transferred to
Medirest, I saw new opportunities to develop my career
and I now work in HR and training, which is far more
fulfilling. Lots of my colleagues are also taking courses so
they can develop their own careers with Medirest, either
here or at other Medirest sites across the UK.”
The scale of Medirest’s operations provides a range
of new career development opportunities for staff
transferring from the NHS. Bernadette Thorpe,
Medirest’s Strategic Partnership Director, says, “We
have an excellent track record when it comes to taking
people on as part of the wider Compass family. There
are huge opportunities for staff to move into different
and sometimes more senior roles, either where they
are currently based or in other hospitals around the
country, whether they are hospital chefs, administrators,
housekeepers or managers.”
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MEDIREST PERFORMANCE WITH HEART
ACHIEVING COST-SAVING TARGETS
Cost reduction is a principal driver for
most non-clinical outsourcing projects in
the NHS. For Trust decision makers, the
ability to track and report on the
achievement of cost-saving targets is critical.
LESSONS FROM THE
ROYAL SURREY COUNTY HOSPITAL
At The Royal Surrey County Hospital,
Medirest is meeting its contractual
requirement to deliver 10% cost savings
across housekeeping and portering services,
with virtually no reduction in headcount.
This has been achieved through reduction
of required overtime to deliver services, as
well as through investment in equipment and
training for staff, enabling them to become
more productive.
ACHIEVING TANGIBLE
PERFORMANCE IMPROVEMENTS
To justify decisions to outsource non-clinical services,
hospital executives need to see real, tangible
improvements in service quality and performance
compared to previous ways of working. In addition,
partners must provide in-depth reports on service
enhancements that focus on service responsiveness,
quality and value.
LESSONS FROM THE ROYAL SURREY COUNTY HOSPITAL
The ability to measure significant
performance improvements was key
to the success of the Royal Surrey
County Hospital’s outsourcing
project with Medirest. For this
reason, Medirest delivered the
transition to outsourced services
according to a detailed plan, which
covered everything from staff
engagement to the delivery of
required training and procurement
of new equipment. In addition to
this planning, measures were put
in place to carefully monitor key
performance metrics – especially
during the first 12 weeks of the
contract when newly outsourced
services are at the highest risk of
experiencing performance issues.
By preparing effectively for the
transition to outsourced services,
and closely monitoring service
delivery during the earliest days of
the contract, Medirest and Royal
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Surrey County Hospital have been
able to demonstrate tangible
performance improvements across
all service areas.
“If you visit our hospital, you can
immediately see that things are
working better than before,” says
Turner. “Staff have new uniforms and
equipment, and wards look visibly
cleaner. The portering team is also
more motivated and responsive, and
other services such as the switchboard
have also improved almost beyond
recognition.”
The extension to Medirest’s
contracts at The Royal Surrey
County Hospital has also
significantly improved the
appearance of the hospital.
“We have a completely refurbished
restaurant, a brand new Marks &
Spencer Simply Food store, and
a larger Costa Coffee store in the
entrance to the hospital,” says Turner.
“All this represents a huge investment
from Medirest that is directly benefiting
the hospital and its patients, staff and
visitors.”
Housekeeping is a key area
where Medirest has delivered
tangible performance and quality
improvements. “Medirest has
introduced microfibre cleaning, which
is far more effective than our previous
housekeeping methods,” says Rana.
“With this new system, and the right
training and equipment, we have
already raised our quality control scores
by 10%. The Trust is happy, staff are
happy, and patient satisfaction surveys
have improved every quarter.”
Performance improvements for
housekeeping operations have
been benchmarked at around +10%
based on an internal audit.
“Because we are a specialist in our field, we
have been able to leverage service delivery best
practices and lessons learned on other contracts
around the UK. We have also invested in the
people, training, equipment and management
supervision needed to deliver a better quality of
service at a lower cost. By empowering teams
to work more efficiently and productively, and
eliminating duplicated tasks, we have been able
to meet our contractual targets for cost reduction
so far, and we hope to exceed them in the future:
sharing any additional benefits with the Trust.”
Additional Cost Improvement Plans (CIPs)
are also being developed by The Royal
Surrey County Hospital and the the
Medirest project team.
“Working with the Board, we are constantly
working to identify new CIPs” says Kruger. “Some
of these require only small, tactical changes to the
way we are currently working, while others require
significant investment. In all cases, though, we are
100% focused on maximising cost efficiency for
The Royal Surrey County Hospital and helping the
Trust achieve its mandated
cost-reduction targets.”
The savings delivered by outsourcing soft
FM services to Medirest are being diverted to
enhance core, patient-facing services. “We
are saving around £179,000 a year with Medirest
compared to our previous way of working,” says
Alf Turner. “That is helping us to increase funding
for nursing and other critical frontline services that
improve outcomes for patients.”
“The savings we have achieved with Medirest are being
directly channelled into frontline services, helping to
increase the number of nurses on duty and to improve
the quality of patient care.”
Alf Turner
Director of Organisational Transformation,
The Royal Surrey County Hospital
DRIVING CONTINUAL IMPROVEMENT
At The Royal Surrey County
Hospital, Medirest has
implemented a highly inclusive
strategy for driving continual
improvement. Team members
are actively encouraged to pass
on their ideas for streamlining
working practices to their
managers, and good ideas are
escalated and implemented,
with recognition for the
member of staff concerned.
Central to this is training and
development to ensure the team
has the knowledge to really
understand the KPIs within each
service stream.This knowledge
is generated via a clear
communications model that
involves team members meeting
daily in ‘huddles’ to discuss
their activities.
At The Royal Surrey County
Hospital, we’ve been able to
implement a number of initiatives
to improve performance by listening
to individual team members who
have ideas about how they can
do things better,” says Minter.
“If someone has a good idea,
we write up a project sheet and,
if the project gets approval, we
implement it across the team.
Where there are successes, we
write them up in our newsletter and
on our social media platform, giving
the team member the recognition
they deserve. As well as helping us
drive continual improvement, this
approach gives team members a
voice, which they really value.”
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MEDIREST PERFORMANCE WITH HEART
CONCLUSION
The experiences of The Royal
Surrey County Hospital show how
outsourcing non-clinical services
to trusted private-sector partners
can help NHS Trusts to improve
performance and achieve significant
operational cost savings.
The success factors outlined in this paper can
be implemented by any NHS Trust wishing to
embrace an outsourcing strategy for their nonclinical services, including soft FM services. By
taking a similar approach to The Royal Surrey
County Hospital, Trusts can overcome all the
common outsourcing challenges, from political
and ideological opposition, to effective staff
engagement and mobilisation.
Having gone through the process of benchmarking
in-house services and transitioning key soft FM
services to Medirest, The Royal Surrey County
Hospital is now in a position to extend its
outsourcing strategy to new areas over the coming
months and years.
“I know there are more non-clinical services that we
could outsource to Medirest, which would give us
even greater economies of scale and operational cost
savings,” says Alf Turner. “We’re currently looking
into that – especially for services such as reception and
helpdesk that are part of Medirest’s core competency.”
To find out more about the The Royal Surrey
County Hospital and Medirest partnership, or
for advice on outsourcing non-clinical services,
please contact Simon Kruger at
[email protected]
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ABOUT MEDIREST
ABOUT THE ROYAL SURREY COUNTY HOSPITAL
Medirest is the UK’s leading healthcare support service
company, working in more than 50 acute hospitals and
medical treatment centres.
The Royal Surrey County Hospital is a
leading General Hospital and specialist
tertiary centre for cancer, Oral and
Maxillo-facial surgery and pathology.
The hospital serves a population of
320,000 for emergency and general
hospital services and is the lead
specialist centre for cancer patients in
Surrey, West Sussex and Hampshire,
serving a population of 1.2 million.
Our aim is to provide the highest quality, best value
housekeeping, catering, logistics support and retail
services to the healthcare sector.
Medirest improves
the patient experience by delivering:
• Clean and safe hospitals
• The best patient dining experience in the world
• Flexible and professional services, including
housekeeping, portering, security services,
switchboard, helpdesk and other support services
• The best choice of retail brands including
high street names
The Royal Surrey County Hospital sees
around 280,000 outpatients a year, 61,000
of whom are admitted for treatment.
Around 70,000 patients attend the A&E
department annually and hospital staff
deliver 3,200 babies.
Patients at The Royal Surrey County
Hospital benefit from state-of-theart diagnostic equipment including
two MRI scanners, four CT scanners,
interventional radiology equipment and a
gamma camera.
The Trust has a very strong reputation
for minimally invasive surgery and
laparoscopic surgery, which is used
widely across all surgical specialties. The
Trust’s Minimal Access Therapy Training
Unit is a national leader in laparoscopic
surgery training.
Structured around 13 special business
units (SBUs) that are supported by a
range of Clinical Support Services, The
Royal Surrey County Hospital has 3,000
staff, 527 beds, 14 operating theatres
and annual income of £257 million. With
close ties to the University of Surrey,
The Royal Surrey County Hospital has
an extensive education, training and
research portfolio.
The Royal Surrey County Hospital
provides a range of services for
patients in the community, as well as
running outpatient clinics at Cranleigh,
Haslemere and Woking hospitals and a
number of local GP surgeries. Patients
can also go to Haslemere Hospital for
endoscopies and even more services
will soon be delivered closer to where
patients live.
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T: 01895 554555
www.compass-group.co.uk/healthcare
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