The Merlin Standard:

Improving Work Programme Supply Chains

Chris HiggsJane Malbasa

Department for Work & Pensions

• The Merlin Standard

– Aims & Objectives

– Background

– Vision

• Exploring the Standard, expectations & implications

• National roll out of the Standard

• Questions & Discussion

Contents

The Merlin Standard • A DWP and W2W industry developed Standard of

Excellence in supply chain management

• Aims to ensure fair treatment of partners and subcontractors by Prime Contractors.

• Achieved through process of self assessment, independent evidence based assessment & accreditation by assessment body, validation of evidence by sub-contractors

Progress to date and future aspirations

• Origins are DWP’s Commissioning Strategy and Code of Conduct

• Development & piloting of the Merlin Standard

• National roll out- A requirement of Primes within 12 months of contract let from the Framework

• Vision for the future

Principles, Elements & Criteria

4 key Principles:– Supply chain Design

• Elements– Criteria

– Commitment– Conduct– Review

Merlin Products

• The Merlin Standard – Version 10

• Merlin Assessment & Accreditation Service & Assessment Guidance

• Merlin Web Portal

• Merlin Mediation Service

Merlin Assessment & Accreditation Service

• Assessment & accreditation by appointed body– Site visits– Validation with prime & subs

• Assessment Guidance• Scoring ranges

– Excellent 85% +– Good 70 – 84% – Compliant 55 – 69%– Unsatisfactory 0 – 54%

The Merlin Web Portal• Web Portal launched in November 2010

• Focal point for all Merlin activity

• A practical tool to support prime & prime contractor engagement - potential Sub-contractors can register and upload profiles

• User friendly design based on consultation

www.themerlinstandard.co.uk

Merlin Mediation Service

• A developing service that is part of a disputes handling process

• Independent service positioned to mediate in cases that have failed dispute resolution

• The Mediation Service will be delivered by the Independent Case Examiner (ICE) and be available from summer 2011

The Merlin Advisory Board

• Strategic monitoring and advisory body that will support DWP in providing leadership for The Merlin Standard

• DWP, Cabinet Office, Welfare to Work industry, & independent representation

• Terms of Reference:– Oversee the Standard, providing assurance that the core

Merlin products of Assessment & Accreditation, and Monitoring & Arbitration, and supporting Guidance and Merlin Web Portal, are delivered and developed to a high standard and in the spirit of the DWP Commissioning Strategy Code of Conduct.

Expectations & Implications

• Rigorous measurement of supply chain working– Illustrations of requirements to achieve and maintain the

Standard

• Penalties for non – compliance– Publication of Assessment reports– Suspend eligibility to benefit from ‘market shift’– Action on breach of contract

Merlin criteria – illustrating the expectations of Prime providers

• Scope & variety in supply chain design

• Communicate proactively with supply chain @ all stages of procurement

• Consultation with supply chain to inform decisions

• Culture of openness & honesty

• Development of staff within Supply Chains

• Assisting SCPs access funding & support

• Fair & transparent procurement processes & selection of SCPs

• Funding arrangements fair & not causing financial risk to SCPs

• Contracts defining obligations

• Negotiated volume, funding & performance expectations

• Rationale for market share • Requirements of SPCs taken

into account

Further details of the Standard - Expectations of Prime providers

• Management fees discussed and agreed

• Mutually agreed core principles

• Clear TUPE strategies• SC updated re- legislation &

contractual requirements• Policies to maintain security

of data and assets

• Maintain healthy & safe environment Post contract funding & arrangements reflect pre-contract agreements

• Dispute resolution processes for SCPs

• Bound by mediation service decisions

• Evolving Supply Chains

Pilot Assessments - Examples of best practice

• Supply Chain Design:– ‘Innovative supply chain examples had wide scope and variety, targeted resource

towards hardest to help groups, explored and utilised alternative funding sources, and up-skilled internal resources to address local gaps in provision.’

• Commitment:– ‘Some Primes provided excellent examples of capacity building and development of

supply chain partners, including provision of front loaded funding, interest free loans, shared infrastructure, support in achieving security compliance, and provision of staff training and development activities. ..engendering a one team ethos across the entire supply chain, and a sense of shared ownership’

• Conduct:– ‘Good practice included evidence of holistic approaches, incorporating regular supply

chain feedback, robust and supportive quality assurance, and positive focus, embedded throughout the supply chain’.

• Review:– ‘Best practice examples include development of corporate strategies for reviewing and

evolving the supply chain as customer needs are reviewed and reassessed’

From Pilots …….

• We are at a juncture

• Merlin Pilots have informed the design and progression of Merlin Standard model

• Lessons from pilots adopted in national design

…….to National Implementation• Version 10 of the Standard available, & Assessment Guidance to be

released

• The Merlin Standard co-regulated by Government and Industry through a representative Advisory Board

• Procurement for an independent Assessment & Accreditation Service, & Web Portal maintenance to commence shortly, scheduled to be launched in Autumn 2011

• Mandatory requirement for Prime providers to be accredited under the ‘Merlin Standard’ within 12 months of contract award, from introduction of the Work Programme

• Penalties will applied for non – compliance

• A new Mediation service delivered by Independent Case Examiner provides a route for complaints from sub-contractors

For further information contact:

Jane.malbasa@dwp.gsi.gov.uk

Monya.ladipo@dwp.gsi.gov.uk

Visit Exhibition Stand 9

www.themerlinstandard.co.uk

Questions & Discussion