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Supp FailureContingencyPlanningTemplate

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17 views

Supp FailureContingencyPlanningTemplate

Uploaded by

Yedid Amq
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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SUPPLIER FAILURE

CONTINGENCY
PLANNING TEMPLATE

February 2019
SUPPLIER FAILURE CONTINGENCY PLANNING

Supplier Failure Contingency Planning

This template is intended to provide a basic template for what you will need to cover in your
contingency plan to ensure operations or services can be maintained in the event of supplier
insolvency. In addition to the headings provided you should consider any specific issues
related to your particular contract and service that need to be covered.

1. Introduction
1.1 Description of the services being delivered
Please set out relevant details on the services being provided, including:

 The name of the contract and a general description of what it involves and its
deliverables;
 What the supplier provides and to whom (and who would suffer from a discontinuation of
services);
 How this fits in to the Authority’s objectives and HMG priorities;
 Whether this service forms part of a wider delivery eco-system;
 The key supplier’s partners and dependencies in delivering the service;
 The competitiveness of the market for this contract; and
 A summary of other credible service providers in the market.

1.2 Contract details


Please add relevant details on the contract, including:

 The supplier and importance of the contract to them;


 The total contract value and a breakdown per annum;
 The contract length and end date;
 Whether this a profitable contract and the margins;
 The transparency of the contract and what information is held by whom;
 The type and cost of any significant investments the supplier needs to make;
 Any onerous contractual obligations, and their financial value; and
 The number of people employed by or used by the contractor to deliver it.

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SUPPLIER FAILURE CONTINGENCY PLANNING

2. Governance and Decision Making


2.1 Senior Responsible Officer
Please provide the name, job title and contact details of the Senior Responsible Officer and
his/her reporting line, with any relevant boards that he/she sits on. This person should own
the contingency plan and be responsible for its delivery.

2.2 Governance
Please set out the governance arrangements should the contingency plan be enacted. The
names and titles of all those on each of the boards/groups should be provided, along with a
short reason for their attendance. For each Board/Group you should provide a brief outline of
their key responsibilities, reporting requirements and decision making authority. Terms of
Reference for each should be provided in an annex. Depending on the scale and nature of
the contract you may choose to have one or more of the following:

 Joint Contingency Working Group;


 Programme Board; and
 Department Board.

You should set out how Ministers, Cabinet Office, and HMT will be kept informed and
involved throughout the implementation of the contingency plan.

2.3 Contact Details


You should ensure you have contact details for key decision makers and advisers (including
out of hours numbers if necessary) and conference facilities available if required.

3. Maintaining Essential Contracted Services in the Short


Term
Operational continuity plans should build on the service continuity plans provided by the
supplier and describe in detail the practical, financial or legal measures that would need be
taken immediately following supplier failure (or in advance if failure is anticipated) to ensure:

 The immediate retention of the workforce or critical personnel and payment of staff;
 Continuity of business support systems and infrastructure (such as IT, ancillary services,
utilities, sub-contractors;
 The availability of key assets, including physical access to them;
 Authority structures for the management of any interim arrangements and how to sustain
them; and
 Detailed costing of these contingency measures (and analysis of wider options) including
the ability to demonstrate value for money in financial terms.
 The Authority should assess its legal position under the contract and consider:
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SUPPLIER FAILURE CONTINGENCY PLANNING

 What rights it has to step-in or terminate the contract;


 Whether it has any rights to call under a parent company guarantee to ensure continued
performance of the contract;
 Whether funding can be provided to maintain service, in advance of insolvency if
necessary, without breaching State Aid provisions; and
 What demands an Administrator or Liquidator might make in order to maintain the
service and how to react to them.
 In common with contingency planning good practice, the plans should set out:
 Details of where responsibility for effecting the plans lie, and roles & responsibilities
associated with it;
 The key deliverables and timescales for implementation;
 A communications strategy; and
 Details of any testing or the assurance process that will be undertaken for these
measures.

Short term plans should also reflect the fact that contract failure may not occur at no notice,
and therefore measures may need to be escalated as appropriate, according to a pre-defined
set of triggers (with enough flexibility to respond to unforeseen scenarios).

The short-term plan should also identify the risk presented by disruption to the service or
operations in terms of impact on customers/users, legal implications, security vulnerabilities,
reputational damage to HMG and financial costs.

Due to the number of unique factors associated with contractor failure, consideration should
also be given to a wide variety of practical elements including:

 Which other organisations/parties/users (e.g. the Public, Ministers) should be engaged


and when;
 Any statutory regulations that need to be observed and how this would be achieved;
 The management of dependencies on sub-contractors;
 HMG liabilities and insurance;
 Transfer of any digital services; and
 The ability of these plans to be enacted outside of normal working hours.

4. Options for Alternative Commercial Solutions and


Contract Management in the Longer Term, including any
Temporary or Emergency Arrangements
This section should provide an appraisal at a high-level for each of the options proposed for
replacing the supplier with another commercial solution, both in the medium term and in the
interim should a temporary or emergency arrangement be required. In the event of supplier
insolvency these may include transfer in house (or to a Government owned company) or a
direct award to an alternative supplier. You will want to consider:
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SUPPLIER FAILURE CONTINGENCY PLANNING

 What factors should be included in each option analysis e.g. market


conditions/alternative suppliers, security considerations, etc;
 The triggers for action, including how these are monitored and by whom;
 Contractual rights to enact contingency plans;
 The mechanisms to take control of the service and the feasibility of each approach;
 The cost and resource requirement for each option;
 The liabilities which come with the contract;
 Assets that fall within the contract and ownership;
 The political/reputational impact of the contingency options; and
 Timeline for implementation.

4.1 Recommended strategy


You should indicate the recommended strategy for taking forward the contingency plan and
the reasons why. This may be a mix of options, or different options under different scenarios.

5. Resource and Costs


5.1 Resourcing strategy
This section should set out a resourcing strategy for the preferred short-term and longer-term
options as well as any temporary or emergency arrangements. This should include:

 The number, type and seniority of people involved;


 Where this resource will be sourced from, and person responsible for securing this; and
 The background processes that will be required (e.g. payroll, procurement).

5.2 Funding strategy


This section should set out a funding strategy for the preferred short-term and longer-term
options including any temporary or emergency arrangements. This should include:

 Estimated costs for the preferred options. Your level of confidence in these costs should
be indicated along with a % range of variance. This range will be based on the level of
confidence;
 Possible sources of funding and/or financing;
 The level of engagement required by other government stakeholders (e.g. Treasury and
Cabinet Office);
 Details on any liabilities associated with the contract and contingency plans, an estimate
of their value a proposal for their handling; and
 Details of the person responsible for the budget and expenditure decisions.

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SUPPLIER FAILURE CONTINGENCY PLANNING

6. Assets
6.1 Asset Register (including IP)
Please attach a detailed asset register for the contract and delivery of the service, where
appropriate. This should highlight when it was last updated. This should include who owns it,
an estimation of value, and an estimated buy out cost if relevant. A summary of the status of
assets in the event of contract failure should be included, along with who is responsible for
updating the asset register.

The register should include details of any key intellectual property (source code, etc) and
data and set out how this will be protected and transferred to a new supplier or in house.

7. People
7.1 Contractor
List the names and roles of the key individuals on the supplier side involved in this contract
that would be important to retain with a reason why.

7.2 Unions
List the unions that would need to be engaged in the event of a contractor failure, contacts for
them, and the number of staff they represent.

7.3 Government
List the key departmental contacts who will be engaging with the rest of central government.

8. Wider Supply Chain


8.1 Sub-contractors
List the sub-contractors of the contractor and what they do on the contract. If possible this
should include an estimation of their importance to, and dependency on, this contract with the
location and number of staff involved. Any other interdependencies should also be mentioned
here.

8.2 Contractual rights


Set out and explain the provisions in the contract to enable a transfer of subcontractors, to
allow them to continue delivering services, and on what terms.

8.3 Monitoring
Set out what monitoring of subcontractors takes place, where can this be found and who is
responsible.

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SUPPLIER FAILURE CONTINGENCY PLANNING

9. Risk register
You should attach a detailed risk register for the contract and delivery of the service. This
should highlight when it was last updated. This should include who owns the risk, an
estimation of value, and mitigating action underway, along with who is responsible for
updating it.

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