Welcome Tony Comber Harlow Centre for Business Support

Collaborative Strategies to Support SME InclusionAction Planning MeetingEast of England RegionMonday 3rd November 2003Latton Bush Centre, Harlow, Essex9.30am – 4.00pm

Welcome Tony Comber Harlow Centre for Business Support

Morning Programme 10.00 Welcome, Introductions, Setting the objectives for the day 10.15 Public sector e-procurement - a driver for SME e-tradingPaul Keegen, UK online for business 10.40 Assessing the potential impact of LA e-procurement on the local economyMartin Scarfe, Newham Borough Council & NePP Programme Board 11.00 Coffee 11.10 The suppliers view, “what about the benefits to us?” - the end-to-end viewKevin Hart, Sage e-Services 11.25 Case study: collaboration in the South West RegionDick Willis, CNR 11.50 What’s happening here? Essex SME e-Enablement Project - Pete Perkins, Essex County Council Harlow -Tony Comber, Harlow Centre for Business Support Thurrock -Margaret Gozna, Thurrock District Council

Afternoon Programme 12.30 Lunch 13.45 The challenge, where are we now and where we need to get toIntroduction: Peter Duschinsky 14.00 Action Planning - Identifying and plugging the gapsBreak out groups, plenary 15.30 Final summary: have we got an Action Plan?Peter Duschinsky 16.00 Close

Objectives for today • Our objectives today are to develop an Action Plan which: • Recognises the impact on B2B companies in the East of England Region of public sector e-Procurement • Helps EER pubic sector organisations to recognise the issue and take account of their local business communities in their e-procurement plans • Helps EEDA, Business Links etc to support local businesses through the changes • Creates the links to enable this to happen in a coherent fashion

Morning Programme 10.00 Welcome, Introductions, Setting the objectives for the day 10.15 Public sector e-procurement - a driver for SME e-tradingPaul Keegen, UK online for business 10.40 Assessing the potential impact of LA e-procurement on the local economyMartin Scarfe, Newham Borough Council & NePP Programme Board 11.00 Coffee 11.10 The suppliers view, “what about the benefits to us?” - the end-to-end viewKevin Hart, Sage e-Services 11.25 Case study: collaboration in the South West RegionDick Willis, CNR 11.50 What’s happening here? Essex SME e-Enablement Project - Pete Perkins, Essex County Council Harlow - Tony Comber, Harlow Centre for Business Support Thurrock - Margaret Gozna, Thurrock District Council

Morning Programme 10.00 Welcome, Introductions, Setting the objectives for the day 10.15 Public sector e-procurement - a driver for SME e-trading Paul Keegen, UK online for business 10.40 Assessing the potential impact of LA e-procurement on the local economy - Martin Scarfe, Newham Borough Council & NePP Programme Board 11.00 Coffee 11.10 The suppliers view, “what about the benefits to us?” - the end-to-end viewKevin Hart, Sage e-Services 11.25 Case study: collaboration in the South West RegionDick Willis, CNR 11.50 What’s happening here? Essex SME e-Enablement Project - Pete Perkins, Essex County Council Harlow - Tony Comber, Harlow Centre for Business Support Thurrock - Margaret Gozna, Thurrock District Council

Assessing the potential impact of Local Authority e-procurement on the local economy in the London Borough of Newham Martin ScarfeNewham Borough Council& NePP Programme Board

Introduction • Newham plans to implement e-procurement ahead of the national target, by 2004 • This will bring savings through increased transaction efficiencies but will also mean some consolidation of suppliers • A large majority of businesses in London are micro firms (less than 5 employees) and are in low value sectors • This is true of Newham’s suppliers

Economic Development & Community Strategy • Newham's economy is weak by London’s standards • There are fewer local employment opportunities,particularly in high value, knowledge driven sectors such as finance and business services • Proposed action to redress these realities include: • Improving the skills of the local labourforce • Making the local environment more attractive • Improving transportation • Reducing crime

Policy Context Summary • SME support policy and economic and community development policy in Newham are already tightly integrated. • Procurement policy however remains somewhat isolated • e-Procurement’s intended outcomes – cost savings – do not have obvious ties to other policy areas • It is the unintended consequences that are most relevant and must be addressed through a ‘joining-up’ of policies

Newham Has Fewer Businesses than its Neighbours

Large Majority of Businesses have Less than 5 Employees

London East Showing Signs of Employment Decline

Very Low Levels of Employment in Newham

Newham Residents Have Fewer Qualifications

High Levels of Deprivation in Newham and East London

Summary analysis of the match process ‘Corporate’ match rate significantly better Modest match rate when all suppliers are included 17,724 Still very significant proportion of supplier file by value & transaction volume

The Geography of Newham’s Suppliers 33% of all suppliers are physically located in Newham

Local Transactional Supplier Analysis 100% Size of 90% Supplier (employees) 80% 96% of matched LOCAL suppliers by value employ less than 50 people 70% 500 + 201-500 101-200 60% 51-100 % of total 21-50 50% 11-20 6-10 40% 3-5 1-2 unknown 30% 20% 10% 0% Total Suppliers Total Transactions Total Value

30% of small local suppliers are dependant on Newham for over 20% of their annual turnover % of Suppliers Employment Size Local Supplier Dependency 100% 90% 80% 70% 75%+ 60% 50-75 20-50 50% 10-20 5-9 1-5 40% < 1% 30% 20% 10% 0% unknown 1-2 3-5 6-10 11-20 21-50 51-100 101-200 201-500 500 + Base: All Newham suppliers matched to the SMB Universe AND located in Newham

Identifying Suppliers Most at Risk We looked for suppliers with high Council spend per employee – these would be most affected by loss of Council business Suppliers assumed to be most ‘at risk’ (£ per head)

Generating ‘at risk’ Lists for Action More than £10,000 Newham spend per head (ordered by size of spend) Base: All Newham suppliers/creditors matched to the SMB Universe AND located in Newham

Neighbourhoods at Risk by Vulnerable Employment Total number of jobs in ‘vulnerable’ companies in deprived neighbourhoods

Neighbourhoods at Risk (totals for companies at risk in deprived wards)

Transactions by Level of Ward Deprivation

Local Economic Impact Assessment Summary • Local economic risk is highly concentrated in a few wards, with Stratford - Newham’s commercial centre - the most vulnerable • Businesses at risk in Stratford account for over £7 million in transactions and directly employ 166 persons • The loss of even part of this capital and these jobs would have a strong negative impact on an already vulnerable area • Approximately half of the jobs at risk in Newham are in skilled occupations (professionals, managers, administrators) • Losing these jobs would have a disproportionate effect on the local economy

SMEs at Risk – Conclusions • We are using the Impact Assessment analysis to target the most vulnerable companies • We are working with spending departments to confirm their suppliers • We will link up with business support agencies to assist local businesses with the transition to e-commerce • The @London pilot scheme will offer an easy route for SMEs to move to e-trading with the Council and other corporate and public sector customers

Morning Programme 10.00 Welcome, Introductions, Setting the objectives for the day 10.15 Public sector e-procurement - a driver for SME e-trading Paul Keegen, UK online for business 10.40 Assessing the potential impact of LA e-procurement on the local economyMartin Scarfe, Newham Borough Council & NePP Programme Board 11.00 Coffee 11.10 The suppliers view, “what about the benefits to us?” - the end-to-end view - Kevin Hart, Sage e-Services 11.25 Case study: collaboration in the South West RegionDick Willis, CNR 11.50 What’s happening here? Essex SME e-Enablement Project - Pete Perkins, Essex County Council Harlow - Tony Comber, Harlow Centre for Business Support Thurrock - Margaret Gozna, Thurrock District Council

Morning Programme 10.00 Welcome, Introductions, Setting the objectives for the day 10.15 Public sector e-procurement - a driver for SME e-tradingPaul Keegen, UK online for business 10.40 Assessing the potential impact of LA e-procurement on the local economyMartin Scarfe, Newham Borough Council & NePP Programme Board 11.00 Coffee 11.10 The suppliers view, “what about the benefits to us?” - the end-to-end viewKevin Hart, Sage e-Services 11.25 Case study: collaboration in the South West RegionDick Willis, CNR 11.50 What’s happening here? Essex SME e-Enablement Project - Pete Perkins, Essex County Council Harlow -Tony Comber, Harlow Centre for Business Support Thurrock -Margaret Gozna, Thurrock District Council

Afternoon Programme 13.45 The challenge, where are we now and where we need to get toIntroduction: Peter Duschinsky 14.00 Action Planning - Identifying and plugging the gapsBreak out groups, plenary 15.30 Final summary: have we got an Action Plan?Peter Duschinsky 16.00 Close

The challenge Where are we now? • We have les than 18 months to March 2005 • National e-Procurement Project ends March 04 • Some local initiatives in place but little coordination Where we need to get to? • Agreed Action Plan which coordinates approach of all players in support of local SMEs

Action Plan • What needs to be done? • What can each of us do? • Councils • Business Links • Regional bodies • ICT suppliers • Trade Associations, business clusters, alliances • Training Organisations, H.E (and F.E.) Institutions

What can Councils do? • Initiate and support Action Plan • Collaborate with neighbouring councils and other locally based public sector organisations • ‘Share’ suppliers • Develop common pre-qualification approach – minimise effort for suppliers • Play role in local economic development • Community Plan • Best Value – longer-term sustainability of local economy

What can NePP do? • Initiate regional workshops • Demonstrate model for Regional Collaborative Action Plan • Encourage development of Action Plan • Raise awareness among local councils and other locally based public sector organisations • Offer guidance and standards WE CAN’T ACTIVATE COLLABORATION - ONLY YOU CAN DO THAT

What can Business Links do? • Co-ordinate Action Plan, as main focus for local business support services • Work with purchasers to identify and reach local SMEs that will be vulnerable as a result of public sector e-procurement • Provide specialist advisers to help transformation (its not just the technology) • Operate through brokerage to provide wide range of services and support • Provide access to grants and other resources

What can Regional bodies do? Regional Development Agency • Provide the necessary leadership and coordination for Action Plan • Provide or leverage resources to assist engagement processes Learning and Skills Councils • Help develop and support Action Plan • Provide resources to support skills upgrading

What can ICT suppliers do? • Offer support for Action Plan • Design solutions for joined-up e-procurement to ensure end-to-end benefits for purchasers and suppliers • Provide necessary infrastructure investment for suppliers eg Broadband • Provide systems expertise e.g. web-based help • Participate in initiatives eg e-Business Clubs, Technology Means Business accreditation

What can Trade Associations, Business clusters, Alliances etc do? • Ensure their SME members’ interests are represented in Action Plan • Use their influence with their members to disseminate key messages • Provide services where relevant to help SME members through changes • Offer mechanism, where relevant, for SME suppliers to collaborate to engage with public sector supply

What can Training Organisations, H.E (and F.E.) Institutions etc do? Training Organisations (incl learndirect) • Enable suppliers to acquire or enhance skills needed to implement new technologies and processes • Offer variety of learning approaches – traditional to online, including at workplace and at learner’s own pace and schedule Higher Education and Further Education Institutions • Assist with skills development • Assist with process and change management • Offer students for short term projects [work experience]

Action Plan Break out groups • Identify the gaps (20 mins) • Consider what needs to be done to plug the gaps • by whom • by when • Plenary (30 mins) (30 mins)

Action Plan Have we got an Action Plan?

Welcome Tony Comber Harlow Centre for Business Support