• Solution construction
  • Service Definition
  • Commercial models
  • Consensus building
  • Negotiation

Major Utility acting on behalf of Government

Definition, negotiation and delivery of service level agreements to support water industry transformation in Ireland

Government chose our client to (1) transform the nation’s water services, (2) create a new utility – National Water (NW) – and (3) deliver a metering programme. NW’s creation from 34 Local Authority (LA) operations was unusual. Facing IR issues, staff remained within LAs while water assets were transferred to NW, rather than statutory transfer of everything to the new entitiy. 34 Local Authorities would form a key part of the National Water operating model This atypical operating model required unique “Service Level Agreements” (SLA) to provide NW with control of cost and quality, each of which had be agreed across a challenging landscape of stakeholders. David Costelloe provided expertise and know how to help NW navigate these challenges and deliver Heads of Agreement.

David was engaged to apply knowledge of operating models and private sector practices in Service Level Agreements to support negotiation of critical agreements between National Water and 34 Local Authorities. David’s first task was to deliver internal consensus on approach and ambition, documenting it in an “SLA Position paper”. Working across the client team, David helped them (1) identify the services needed to deliver a coherent operating model from NW and 34 component LAs; (2) identified private sector contracting precedents (e.g. inputs v outputs) and (3) led workshops for NW to decide on positions. Once decisions were made, David (4) prepared and developed through dialogue, a discussion paper setting out a coherent set of principles and positions, then (5) helped take the paper through our client’s and Government’s governance to enable the release of the paper the LAs for consideration.

The next step was conversion of the principles into tangible requirements and draft service level agreements to table in negotiations. David worked with NW SMEs to define of the services and quality standards required, holding workshops to facilitate the business to expressing its requirements in a manner capable of being managed through an SLA. A final preparatory step to negotiations was to define engagement and governance mechanisms. David prepared discussion papers on an annual planning process, a management framework, and mechanisms to trigger NW led interventions to take control of operations where LA performance demanded it.

During negotiations, we supported NW by preparing drafts to be discussed in dialogue meetings and, during the meetings, we helped crystallize discussions between the parties into agreed revisions to the drafts, thus converting draft text into agreed Heads of Agreement through a process that was quick and efficient.

Working together with the NW team, David helped his client navigate uncharted waters, moving from a blank piece of paper with few precedents to guide decision making, through to Heads of Agreement accepted by all parties as the basis for creating a national utility. The contracts were “signed, sealed and delivered in time for National Water to go live on 1 January 2014.