The Good Library Blog

Areas of excessive cost in the public library service

The Bookseller, 6 December 2002 (Letter from Tim Coates)

The following are areas of excess cost in the public library service, caused by particular traditional practices that should be changed.

Supply
(a) Servicing, cataloguing, labelling, technical services, internal transportation, various systems of preparation for display, interdepartmental checking, and the management of all these: Every single council has a different method, making efficiencies of supply impossible.
(b) Selection of goods, ordering procedures, management of ordering procedures: Methods are particularly out of date.
(c) Non-standardisation of systems: Each authority has its own, resulting not only in expensive systems but also in excessive numbers of systems departments and systems managers, excessive systems training, incompatibility of cross-council information services, and so forth.
These methods are not only outdated, expensive and open to simplification, but they are also terribly slow and give rise to very poor customer service.

Purchasing
(a) Methods of contracting
(b) Unnecessary requirements of suppliers giving rise to cost in the supply chain
(c) Poor negotiation of discount
(d) Poor management of discount

Supply chain management
The public library service has stood outside industry developments of supply-chain management and improvements in cataloguing, ordering and inter-systems communications. Again this has resulted not only in excess cost but also in poor competitive levels of service.

Productivity
The library service has been very slow to adopt methods of improved productivity in customer service. Systems for automatic lending and return are available but are not widely used.

Payment procedures
(a) Payments of goods on invoice instead of on statement
(b) Duplicated payments systems
(c) Excessively costly clerical systems
(d) Lack of payment by electronic transfer

Unclear lines of management
Many library services have both professional librarians and site managers. This not only gives rise to excessive cost but also to unclear responsibilities and lack of accountability.

Management cost duplicated between council and library service
(a) Councils recover excessive overhead costs by recharging all services, including the library service.
(b) There is insufficient attempt to mitigate against this by using council expertise to manage aspects of the library service, in, for example, the areas of financial control, accounting, systems and property, which means there is duplicated management.

Cost of employment
(a) Employment costs are high compared to comparative private sector staff, yet there is little evidence of extra value in service being given to the public. (Survey scores for knowledge and helpfulness are often low.)
(b) There is a tradition of long service which not only gives rise to high cost but also to a static quality of service that is unlikely to respond to changing customer needs.

General management cost
(a) It is inherently expensive to have a service managed in each council and there is no attempt to mitigate this. Having very senior library managers in each council gives rise to a tendency to have several layers of management, which is expensive and unproductive. It also adds to overhead costs
(b) There is an excessive cost in regional managements, national committees, professional organisations and activities such as conferences.

This list demonstrates a lack of management control and proper concern to contain costs. Traditionally, where cost reduction is necessary, instead of seeking for more efficient methods, the money has been taken from materials budgets which are the prime purpose of the service. The evidence for this is absolutely clear from the annual figures of the Library and Information Statistics Unit (LISU).

At the same time the standard of accounting and budgeting management is poor, and financial controllers are not in sufficiently senior positions.

These comments apply in varying degrees to each council. They are certainly not true in all, but they do represent the overall picture. The saving, over time, to be derived from adequate cost management is of the order of £200 million per annum. With an overall cost of £882 million per annum (1999–2000 statistics, Chartered Institute of Public Finance and Accountancy), the public library service is as large as many in the FTSE top 50 companies and merits a higher degree of attention to productivity and cost control. Of that £882 million, 11.2% was spent on books and material for reading and reference. If most of the £200 million were reallocated and spent on reading material and other improvements to the service, we would solve the problem of declining use. That is why it is correct to call for improvements within existing budgets.

Note: In the UK and Northern Ireland there are 208 library authorities. The £882 million quoted in these CIPFA statistics does not include approximately £100 million of additional lottery funding for the installation of computers for public Internet use and associated training.

Letter from MLA to Chief Librarians - 10 February 2007

Better Stock, Better Libraries
Progress update # 1
The vision for library stock procurement

Our 2012 vision for UK public library stock procurement is a vastly improved framework that will enable libraries to obtain books better matched to customer needs, as quickly as high-street and online booksellers, and at a highly competitive price.
The Better Stock Better Libraries programme will:

• help libraries to build services around community needs, improving availability and choice of stock for customers; and

• increase the efficiency and effectiveness of library stock management, which would enable savings of £22m that can be reinvested into local services.

The report Better Stock, Better Libraries is accessible at the following url: www.mla.gov.uk/website/programmes/framework/framework_programmes/stock_procurement/

Feedback and priorities for action

The feedback that we have received since the publication of the report highlights a broad, although not universal, consensus that efficiency and effectiveness can be secured by libraries working together, including:

• joint arrangements for procurement;

• streamlined servicing standards;

• sharing activities between authorities such as bibliographic servicing; and

• shared standards for key technology including Electronic Date Interchange, Library Management Systems, catalogue records and RFID.

Some concerns have also been expressed about the report’s proposals including:

• the risks that joint working might result in reduced local flexibility and/ or slower delivery times for stock;

• the need to ensure a sustainable supply of stock and related services, and concerns about the impact of the proposed ‘eMarketplace’ on the future supply of stock and related services;

• the feasibility of developing shared ICT standards that will support joint working, for example in relation to LMS; and

• the need to ensure that local accountability for the service as a whole is maintained, and that individual authorities are able to retain influence over the stock that they can offer their library users.

The MLA is supporting the programme through Framework for the Future programme budget resources of just over £1m. These resources will be used to support implementation of key elements of the model in a number of authorities and groups of authorities. We are actively seeking further sources of funding to invest further in the sector in order to implement the full model.

Taking account of the feedback we have received on the report’s proposals, the available resources, and the need to make sustainable improvements, the Programme Board has agreed the following priorities for the next 12 months, including support for:

• ‘proof of concept’ pilots to demonstrate the achievability and benefits of new ways of working and secure improvement, in particular through shared activities in areas such as bibliographic servicing and specialist stock procurement;

• common platforms and standards to support joint working in areas such as LMS, EDI, bibliographic data and RFID, as well as servicing standards, categorisation, contractual and selection frameworks;

• better procurement, including a model contract, simplified specifications, and aggregated purchasing that ensures a sensible balance between maintaining continuity of stock supply and getting the best deal for the sector; and

• groups of authorities to undertake financial analyses to enable them to assess the benefits of the new arrangements for themselves.

Current work and next steps

Governance arrangements
We have established strong governance arrangements for the BSBL programme, led by a Programme Board of seven members:

• Geoffrey Bond, MLA Board Member (Chair);
• Chris White, Local Government Association and Lib Dem Hertfordshire County Councillor (Vice-Chair);
• Jane Harwood, MLA Deputy Chief Executive;
• David Wright, Director NE Regional Centre of Excellence;
• Keith Nichol, Divisional Head, DCMS;
• Mike Suarez, Director of Finance, London Borough of Lambeth; and
• Rob Froud, President Society of Chief Librarians, Somerset Head of Libraries and Chair, Libraries West consortium

The Board is also bringing in additional expertise to support the programme, including a local authority chief executive, a chief librarian with a strong track record of service improvement and a private sector representative with knowledge and experience of publishing and retail.

The Board is being supported by a small, dedicated team within MLA with responsibility for overseeing delivery of the work programme, led by Andrew Stevens as Programme Director. In addition, we are establishing an Advisory Group to bring together key experts and representatives to advise the Programme Board.

Immediate actions
Working with the Board, we have:

• Set out an action plan for the next 12 months, supported by appropriate programme controls including a risk register and arrangements to monitor progress and deal with the inevitable challenges that the programme will face;

• Agreed ‘proof of concept’ activities with a number of groups of authorities to take forward work over the next twelve months, including working with:
o a group of authorities in North West England to develop shared bibliographic servicing arrangements;
o LibrariesWest on a project which will review alternative business models and assess the potential of expansion of the consortium.
o a group of authorities in Yorkshire to develop shared servicing arrangements; and
o working with the SELPIG consortium on a project they are taking forward on joint stock management.

• Identified other partners with an interest in taking forward work in other key areas including the development of:
o better procurement including simplification of requirements, streamlining of procurement processes and the development of a model contract;
o shared standards in key areas such as LMS, EDI and RFID, to support collaborative working; and
o a financial analysis tool to support library authorities in assessing their priority areas for improvement.

• Submitted a Comprehensive Spending Review bid to DCMS to try and secure further financial support for the BSBL programme.

Immediate next steps
We will take the programme forward over the next few weeks with a focus on:

• working with groups of authorities to build momentum for the proof of concept activities set out above;

• agreeing the scope of those projects where groups of library authorities have expressed interest in taking work forward;

• convening the programme Advisory Group for its first meeting; and

• engaging with the libraries sector and other key stakeholders in workshops and other events, setting out in more detail the work already underway, linking up with authorities and groups of authorities who would like to take part in local projects to test and develop our proposals, and listening to feedback on our priority areas for action.

How to get involved

As we have set out above, there is also significant activity amongst library authorities to broaden and deepen joint working, and a commitment to testing our proposals for improvement in stock procurement.

We are keen to extend programme participation across the libraries sector, and we therefore invite contributions from across the sector in a number of areas:

• interest in taking forward a pilot, to test the proposals for change set out in Better Stock Better Libraries, which are priorities over the next twelve months, i.e. shared activities between authorities, improved procurement, and developing common ICT platforms;

• Involvement in the programme in other ways, i.e. participation in one or more working groups to support the priority programme activities set out above; and/ or

• Feedback on our approach to the programme, particularly if you can identify contributions that might be required to support technical elements, gaps in the programme elements, concerns which have not been picked up, or good practice we should be aware of that we have not already picked up within the programme.

We want to keep you informed about the progress of the programme. In addition to the workshops and events we are already planning, we propose to do this through:

• regular email updates and briefings like this one; as well as

• more detailed briefings on key issues and challenges, through SCL regional representatives and Board Members.

if you have other proposals for how best we can update and engage with you on the programme’s progress, please do get in touch with us directly by email at:

bsbl@mla.gov.uk

If you would like to participate in the Better Stock Better Libraries Programme in these or in other ways, please respond to the email that was sent with this update briefing by Wednesday 28 February 2007, identifying the type of contribution you wish to make to the programme.