Local government reorganisation – the M&A of Local Government?

Local government reorganisation is undoubtedly on track to deliver a once-in-a-generation shake-up of the local government landscape. With it comes a window of opportunity to enhance local accountability, simplify structures and improve service delivery. We must focus on designing contemporary local government organisations while being sensitive and cognisant of the familiarity and association with what is still in place. This is easy to lose sight of when delivering against punishing timelines and transactional deadlines.

Mergers and acquisitions (M&A) are commonplace in the private sector. That is not to say that local government reorganisation is the same as Three Mobile merging with Vodafone. However, by taking the key lenses for success in M&A, some practical steps can help us collectively create more efficient, responsive and community-focused local government structures.

Establish a new mission, vision and brand

Creating a new mission, vision and brand is a critical first step in creating a new organisation. This is more than a new logo. It provides identity and connection to a place and its residents. It gives staff, partners, residents and communities something concrete to attach to.

• Define a clear mission that aligns with the new structure and goals. What are the core values that will drive the newly formed councils? In M&A, successful companies redefine their mission to reflect their combined strengths and new direction.
• Craft a compelling vision that inspires and guides the place and the organisation towards future aspirations, resonating with everyone. A strong, shared vision can unify communities, diverse teams and stakeholders. This will be integral when combining authorities with differing demographics, cultures and working methods.
• Develop a brand that resonates with the place, its citizens, staff, and stakeholders, fostering a sense of identity and purpose. What branding strategies can you adopt to ensure a strong and positive perception? In the corporate world, rebranding post-M&A is critical to signal change and build customer trust during uncertainty.

Have financial control and governance

Getting a firm grip on financial control and governance is essential, especially when integrating different balance sheets.

• Implement robust financial management practices to maintain transparency and accountability. How can you safeguard taxpayer money and ensure a quantifiable return on investment? M&A transactions role model rigorous financial due diligence to ensure transparency and accountability.
• Establish governance frameworks that support decision-making and oversight. How can you design governance structures that promote effective leadership and accountability? M&A highlights the complexities of integration and the importance of clear governance structures to manage inevitable teething issues as they arise (or ideally mitigate them before they become issues).
• Ensure financial sustainability through careful planning and resource allocation.

Bring together service transformation

Service transformation is a significant opportunity for LGR to enhance efficiency and effectiveness. However, bringing together different service functions and teams is challenging.

• Redesign services to better meet the needs of residents. How can you innovate service delivery to improve outcomes for citizens rather than ‘tinker’ with processes?
• Leverage technology to improve service delivery and accessibility. How can you maximise this opportunity to consolidate technology estates and leverage solutions to streamline operations and enhance user experience?
• Engage with stakeholders to ensure that transformation efforts align with community needs. How can you involve citizens, staff and partners in the transformation design? Extensive stakeholder engagement will be essential to ensure alignment and outcomes.

Consolidate contracts and systems

Consolidating contracts and systems can lead to significant efficiencies and cost savings. Firstly, build a picture of the current provisions.

• Review existing contracts to identify opportunities for consolidation and synergies. What contracts can be merged to reduce costs and improve efficiency?
• Integrate systems to streamline operations and improve data sharing. How can you ensure seamless integration of IT systems and processes?

Put people and culture at the centre

People are at the heart of successful transitions. Because people may grieve their old organisation, creating a new culture to help them transition will be fundamental to success.

• Foster a positive organisational culture that supports collaboration and innovation. Culture, change management, and leadership role modelling will be crucial to building cultures that encourage teamwork and continuous improvement.
• Engage employees to maintain morale and productivity during transition periods, ensuring buy-in and commitment while minimising talent drain.
• Maintain community connections to preserve local insights and relationships. Ensure that as councils transition to larger organisations, the new structure remains connected to the communities it serves.

DELIVERING LASTING IMPACT

The implementation phase can feel daunting, but breaking it down and prioritising it will help create manageable phases. It’s not about getting it right the first time; it’s about creating flexible structures that can evolve and deliver lasting impact.