People strategy

The FCO produced its first strategic workforce plan in December 2007. The plan considers:

• what the demands on the FCO are likely to be in five years and beyond
• what size and shape of workforce the FCO will need to meet these demands, and what skills our staff will need, and
• what this will mean for current and future recruitment, training, promotion and retirement.

The plan’s aim is to make sure that the FCO is better equipped to identify and adapt to changing staffing needs in the future.

The FCO is also strengthening its talent management. We have assessed the skills and performance of all 400 of our senior management staff. This has identified potential candidates for top leadership positions in the future and how we can best help them to develop the right skills and acquire relevant experience to fill these positions effectively. These assessments also help those with more limited prospects to plan their future careers inside or outside the FCO. We are now extending the talent management process to other grades below senior management.

To broaden our skills and horizons, the FCO is encouraging staff at all levels to consider spending part of their career outside the FCO – for example with another government department or in the private or voluntary sector. At the same time, the FCO is advertising all senior FCO vacancies across Government.

Posts overseas employ around 10,000 locally recruited staff. These staff members make an important and impressive contribution to the delivery of our international priorities. To get the best out of the talents and skills of our local staff, the FCO has produced a local staff management strategy. This strategy aims to promote a more consistent and professional approach to recruiting, developing and managing our local staff.

The FCO’s in-house language training function closed in October 2007. We have now signed new language training framework agreements with 15 professional suppliers. Between two and five providers will offer tuition for each one of the 60 main FCO languages. These new arrangements provide greater flexibility while maintaining high quality and standards at a reduced cost.

Meanwhile, the FCO continues to look for ways of simplifying our human resources processes, reducing the resources devoted to administering the organisation. IT systems now allow staff to update their own leave and sickness absence records online. The FCO has also simplified the administration and auditing of travel expenses by UK staff serving overseas.

Diversity: making the most of difference

If the FCO is to recruit and retain the best talent available across our global network we need to offer a working environment that is open and inclusive – wherever we operate.

In June 2007 the FCO Board took part in a special ‘Dining with a Difference’ event, designed to give members a new perspective on how disability issues affect the organisation. The overall aim of the event was for each Board member to consider, in practical terms, what the FCO needs to do to improve its performance on disability issues.

Six Board members now champion different aspects of diversity to bring about the changes needed. In March 2008 the FCO produced its first annual diversity report, which outlines our successes and areas for improvement in 2007 and the challenges we face in creating a more diverse and inclusive organisation.

In 2007 the FCO also developed Making the Most of Difference, a practical and interactive one-day diversity and inclusion workshop held at post.

After test runs at posts in China and Nigeria, the FCO launched the workshop in Afghanistan in October 2007 and has since run it in six other countries in Asia and Africa. Nearly 30 posts ran the workshop in the first quarter of 2008.

HM Ambassador to Afghanistan, Sir Sherard Cowper-Coles, said after the workshop:

“As well as being one of Britain’s largest overseas missions, Kabul is one of our most diverse. Not just in terms of visible diversity (having in the team people from different ethnic backgrounds, both British and Afghan, and colleagues with disabilities), but also because the team includes staff from across the range of British Government departments and agencies, civil and military, with very different cultural experiences and expectations.

What made the workshops such a success was that, as well as making a real contribution to our operational effectiveness, they were also fun. They provoked discussion and comment, and gave us all insights into ourselves, and into how our colleagues see us. We were the better for it. Every post, every team, should have one.”

Five Star Finance

Five Star Finance is the FCO’s programme to improve its financial management capability. By April 2009 the FCO aims to:

• be recognised as the best government department for managing its finances
• use simplified, standardised and streamlined processes and tools to make sure that we get things right first time and make best use of our limited resources
• become a department that others look up to and want to learn from and
• actively strive for excellence and deliver an efficient and effective service to our customers, while at the same time developing our skills and knowledge.

‘Five star’ refers to a rating scale devised by the National Audit Office, with one star as the weakest and five stars being the best. At a five-star level, the FCO will have high quality monthly management reporting which is created by reliable data systems and used by highly trained personnel to support key decision-making.

There are a number of projects in this programme, including making improvements in IT, processes, skills and communications. Management information will improve to make sure that monthly reporting is of the same high standard as the annual accounts for Parliament. By removing duplication and unnecessary activities, we will use this programme to contribute towards the efficiencies agreed with HM Treasury, which are to reduce the number of staff carrying out finance activities by 20% during the period 2008/09 to 2010/11.

The FCO is on course to achieve four stars by autumn 2008.

Consular strategy programme

The FCO published a three-year consular strategy [pdf, new window] in May 2007, and launched a major change programme to deliver it. So far we have delivered:

• fully revised staff guidance, structured around the public guide Support for British Nationals Abroad
• fully tested training for all consular staff overseas
• greatly improved management information, by using time recording from all staff giving us information about trends, workloads and productivity and a performance measurement scorecard for all posts
• the first eight of 19 consular regional directors – these directors provide advice and guidance, make sure that levels of services are consistent and improve efficiency in their regions, by linking posts for the first time to a global network that is itself linked directly to policy-makers in London
• LOCATE, an online service for British nationals to register with our consulates and for reporting people affected by or missing during a crisis overseas and
• guidance for posts to help them provide a more consistent service such as how often they can arrange prison visits.

Over the next year, the FCO plans to:

• appoint nine more consular regional directors
• offer an externally accredited and internationally recognised qualification to staff who want to pursue it
• streamline our overseas network to make it more efficient and give us a more flexible workforce overseas
• make more services available online and extend the number of posts able to accept payment by credit or debit card and
• install the necessary equipment to divert out-of-hours consular calls directly to our experts in London.

Passports Next Generation Programme

This programme was launched in June 2006 to set up a more streamlined passport operation, in line with the Identity & Passport Service (IPS) and in support of the National Identity Scheme (NIS).

As individual projects took shape, it became clear that they overlapped with IPS programmes in key areas, including the development of sophisticated and expensive technology. This led to the programme focusing on how the FCO and IPS could combine their respective operations to deliver a more sustainable passport service overseas. The FCO Board approved the case for integration in February 2008. The IPS Management Board will review the case in April 2008.

Meanwhile, the programme continued to analyse future business needs to prepare the ground for change, in readiness for the outcome of the integration study. So far we have:

• introduced a structured approach to passport interviews, based on current FCO best practice and in keeping with the IPS’ authentication by interview (ABI) procedures
• introduced a new training module in interviewing skills
• represented FCO interests on IPS and NIS project boards and at the IPS business change network
• taken part in conferences dealing with consular change and
• decided on the content and layout for a new emergency travel document and begun work on it.

During 2008 we plan to:

• continue work with IPS on a transition plan for integration
• roll out ABI to all posts
• pilot the use of remote interview technology in at least one overseas post and
• develop the new systems for emergency travel documents.

The main risk to the programme continues to be whether we can meet the cost of these changes from the passport fee. On current forecasts, we believe that we can do so, and we will continue to improve efficiency in our overseas passport operation. We will also work to reduce our day-to-day costs by using in-house resources and expertise in the programme wherever possible.

UKvisas

Huge growth in passenger numbers entering the UK demands a new approach to onshore and offshore border controls. Since 2001 the demand for visas has risen by over 50%.

UKvisas has to be a modern and professional organisation to cope with the rising level of visa applications and increased security threats, and still maintain excellent customer service. It is vital to make it easy for legitimate travellers to visit the UK, or they will go elsewhere. So, over the past year, UKvisas has put in place a comprehensive programme of change to deliver its services in new ways, such as:

• using biometrics and risk assessment units
• extending and standardising visa application centres, which are operated by commercial partners and
• developing a ‘hub and spoke’ operating model.

Biometrics and risk assessment

By analysing data collected from post and intelligence gathered from the UK, UKvisas has been able to build up a sophisticated picture of trends in immigration abuse. Biometric identity management systems store identities, and provide details about the person concerned, and so indicate levels of risk. Understanding and identifying high-risk visa applicants makes it easier to identify and welcome low-risk customers.

In January 2008 UKvisas completed the introduction of biometric data collection around the world, under budget and several months ahead of schedule. Anyone applying for a UK visa, wherever in the world they apply, must now provide finger scans. Every month, these biometric checks are currently identifying around 1,000 applicants whose fingerprints are on record in connection with an immigration or asylum matter, and around 100 people applying under an assumed identity.

In August 2007 UKvisas and the National Police Improvement Agency signed a five-year contract to upgrade biometric checks so that they can check fingerprint data against criminal and counter-terrorist records. Work began on these improvements, which will cost £27.4 million, during spring 2008.

The UKvisas risk assessment network was expanded in 2007 and now has global coverage. Over 90% of visa applications are now processed at posts, and we have a dedicated risk assessment unit. The risk assessment operations centre is based in the UK and it provides remote support for all other posts dealing with low-risk and low volume applications.

Commercial partners

In February 2007 UKvisas signed contracts with commercial partners to standardise and extend the network of visa application centres in the UK, which have been introduced throughout 2007/08. These two commercial partners now run over 100 visa application centres, which together process nearly 90% of all applications for UK visas. Benefits to customers include:

• more staff, delivering a more consistent and efficient services for customers
• an increased number of places where people can apply for a UK visa
• longer opening hours and
• a more convenient service.

Hub and spoke

In 2007 UKvisas began to introduce a hub and spoke operating model across the network where it makes operational, business and customer sense to do so, using a variety of models. Hub and spoke – based on the structure of a bicycle wheel - allows certain types of work to be handled by hubs or specialist centres. This system has economic advantages that help to improve consistency in decision-making and deliver the most efficient service:

• Decision-making which is concentrated in regional processing centres (‘hubs’) that sort and process most of the applications received in the region, and make decisions about all the straightforward applications based on clearly defined criteria.
• Operational hubs that focus on more complex cases by carrying out risk assessments, liaising with local authorities, verifying documents and interviewing visa applicants.
• The ‘spokes’, which are mainly our commercial partners, receive visa applications, collect biometric data and make an initial assessment to separate the complex and straightforward applications, and provide remote interviewing facilities.

A key benefit of this operating model is that while their commercial partners are performing the front office function, core UKvisas staff can concentrate on risk assessment and decision-making. Expanding these kind of commercial partner arrangements at the customer-facing end of the business, combined with advances in technology – including biometrics – is also providing the flexibility to move some UKvisas offices to regions with high levels of expertise but lower running costs.

The future

In November 2007 the Prime Minister, Gordon Brown, announced the creation of the UK Border Agency (UKBA). On 1 April 2008 UKvisas merged with the Border and Immigration Agency and parts of Her Majesty’s Revenue & Customs to create the UK Border Agency.

The UK visa service will sit within the wider international group of UKBA and will continue to act as the main delivery agent for offshore migration control. A new Liaison and Intelligence Directorate will bring together risk assessment, airline liaison and other networks, increasing intelligence flows between the UK, the visa service and law enforcement partners internationally. The international policy section will develop action plans for priority countries, working closely with the FCO to achieve objectives relating to asylum, returns and data-sharing among other things.

In preparation for the merger on 1 April, the FCO signed a memorandum of understanding with the Home Office in January 2008. Under the terms of this agreement, the FCO will continue to have a supervisory role that we may use to review performance and policy relating to the overseas network. The FCO director-general responsible for migration (or their representative) will have the right to attend the UKBA Board and the UKBA Extended Board.

UK Trade & Investment (UKTI)

UKTI’s change programme supports delivery of its five-year strategy, Prosperity in a Changing World (July 2006). The strategy aims to maximise the opportunities for British business and the benefits to the UK economy of globalisation through:

• professionally marketing the UK economy internationally
• closer partnerships across Government and with business and
• increased focus on the customers and markets where the strategy can make the most difference, including high growth markets and research and development  sectors.

To be successful, UKTI needs to change its whole culture, so that it focuses on the client, and is led by marketing and driven by performance.

UKTI’s change programme has led to some significant restructuring to support the strategy:

• Posts in our headquarters have reduced by 115 to around 475 since July 2006.
• 90% of UKTI’s people are now in frontline roles overseas, in the English regions, or in customer-facing service delivery in our headquarters.
• £5.6 million of UKTI’s resources overseas moved to 17 high growth emerging markets, with corresponding savings, mainly in more developed markets.
• In posts where resources have been reduced, staff structures have been reorganised to deliver the best results, including regional ‘hub and spoke’ arrangements and some teams led by local staff.

To support its focus on the client, UKTI has introduced a web-based system to manage its customer relationships, and this should create a more effective, professional service to clients. This system works by increasing UKTI’s professionalism through a new learning and development programme, informed by a skills audit, which includes in-depth training in customer relationship management skills and marketing.

UKTI is building a performance-driven culture, with clear and measurable targets in place for 2008/09 to 2010/11. Most of these targets are measured through UKTI’s performance and monitoring surveys, which involve telephone interviews with around 3,000 UKTI customers a year, carried out every three months by independent market researchers. The surveys provide evidence that UKTI delivers real outcomes for the UK economy. Over the 12 months to March 2008, 57% of UKTI’s trade customers reported an improvement in their business performance as a direct result of UKTI’s services. UKTI services also accounted directly for an estimated £2.5 billion added value to the UK economy over 2007.

The next stage in UKTI’s change programme is to transfer responsibility for supporting defence exports from the Defence Exports Services Organisation to UKTI from 1 April 2008. This will involve transfer of around 240 posts. A high-level implementation plan was published in December 2007 and a dedicated implementation team began work in January 2008 to help this transfer go smoothly.

Shared Services Programme

The FCO has set up the Shared Services Programme to transform the way it runs its global network, by taking full advantage of its resource planning system, Prism, and by drawing on best practice from the public and private sectors to roll out shared services in a phased programme.

In September 2007 the FCO Board endorsed the following vision for the Shared Services Programme in the FCO:

“Through the implementation of Shared Services, the FCO will spend less time, effort and money on running itself. We will do this through:

• the creation of Shared Service centres, to deal with all financial, procurement and, ultimately, human resources transactions in a single unified online structure for the FCO network and
• greater and better use of shared contracts, to get the best value for money in buying goods and services.

Our staff, customers and suppliers will benefit from simplified, standardised and streamlined services. We will be better at accounting for our use of taxpayers’ money. And our delivery of the FCO’s strategic framework will be enhanced through better management information, and a streamlined and more agile network.

Achieving cashable benefits during the course of implementation is important. But this will be treated as a consequence of the programme, not its main driver.”

By April 2011 the programme aims to put in place:

• Shared Service centres to cover the UK, Europe, Asia/Pacific and Americas with an initial focus on finance and procurement processes
• a number of regional facilities management contracts and
• procurement optimisation to achieve better value for money through regional and global deals.

Putting into practice the Board’s vision has already begun. We have set up a UK processing centre at our offices at Hanslope Park near Milton Keynes. Since October 2007 the centre has been responsible for processing all invoices for the FCO in the UK. A small team of professionals now handles centrally work that was previously scattered across FCO departments in the UK. This has resulted in:

• reduced staff numbers
• us being able to pay our invoices more quickly and
• a clearer picture of the FCO’s overall financial position.

In the coming months this processing centre will expand to cover other procurement and financial processes and it is the first step towards having a fully functioning Shared Services centre in the UK.

At the same time, the FCO has begun work on outsourcing our facilities management services for our UK premises and for 14 posts in north-west Europe. This is a major procurement exercise, and we are conducting it through a new process known as competitive dialogue. This is only the third time that the Government has used competitive dialogue for a facilities management contract. The FCO hopes to put in place similar contracts for the rest of Europe and in certain other developed markets by 2011.

By outsourcing to these services to businesses who specialise in this kind of area we can:

• get better value for money
• set service standards and
• free up FCO resources for other activities.

We have also analysed FCO expenditure on certain goods and services and we are working to deliver the best value for money for the FCO by shopping around for these goods and services. We have identified clear savings opportunities through negotiating contracts for groups of posts – or the whole overseas network – by using the negotiating power of the whole FCO to secure better deals than individual posts could achieve. We expect this to produce significant savings over the next three years.

FCO Trading Fund Programme

The aim of the Trading Fund Programme is to make sure that the FCO receives a reliable and efficient supply of vital services at better value for money than at present. The FCO Board and ministers decided that this will best be achieved by converting FCO Services, our in-house supplier, into a government trading fund. FCO Services is already an executive agency.

As a trading fund, FCO Services will act as a strategic partner for the FCO and remain under the overall control of the Foreign Secretary. However, it will also be subject to greater commercial discipline and enjoy greater commercial freedom than now. The stronger business focus and pressures will drive efficiency and service improvements, with only modest risk.

During the year, FCO and FCO Services have prepared extensively for FCO Services' conversion to a trading fund. FCO Services has implemented a major programme to develop its staff, structures, systems and processes to cope with a more commercial trading environment. The FCO has streamlined its structure to become an efficient customer of the new trading fund, and we have introduced  business agreements with FCO Services. The National Audit Office and the Office of Government Commerce have confirmed that FCO and FCO Services will be ready for the change. The House of Commons has approved the statutory instrument (SI 2008/590) to set up the trading fund on 1 April 2008.

The FCO held a formal public consultation between July and October 2007 to get the views of interested parties on the overall initiative and, in particular, any new ideas that might increase its success and reduce risks or issues not previously considered. We received useful responses but nothing to suggest the FCO should reconsider its plans. We published a report on the consultation and an associated impact assessment on the FCO website.

Information technology

A chief information officer was appointed to the FCO Board in 2007 and the FCO’s information and technology work was set out within a new strategic plan.

This plan sets out how the FCO is continuing to work towards meeting the Government’s transformational government strategy and deliver information management and technology that helps us meet our strategic objectives. Three strategic themes are identified in the plan:

1. Sustainable IT: The FCO will analyse the long-term environmental impact of its IT and then reduce it, including by assessing all new IT purchasing against environmental criteria, reducing energy consumption, and improving our disposal and recycling practices.

To support that objective we introduced a pilot project called ‘Green IT’ to encourage staff in the UK to turn off their computers overnight. We have used lessons learnt from the pilot to set the power policy for our next generation of desktop computers.

2. Getting the most out of the business value of IT: The FCO will change how it is organised and its operating model to:

• reduce our operational cost
• improve the level of service we deliver and
• deliver business benefits earlier.

This includes:

• adopting industry standard processes to improve our service and reduce costs
• proactively managing our suppliers
• shorter delivery cycles to improve efficiency and
• much closer co-operation with our FCO customers.

3. Making best use of the FCO’s existing investment in IT: We will gain maximum value from the investment in our IT platform by making full use of the standard functions that we do not yet make full use of. This includes:

• supporting the creation of Shared Services on our resource planning system, Prism
• using our global IT system Firecrest to support collaborative and mobile working and improved information management and
• making sure that the next generation of FTN (the FCO’s telecommunications network) we buy makes full use of communications technology.

The FCO will also build and extend the services that we share with partners across Government such as FTN, Firecrest and our web platform. This will allow us to make savings.

We began installing our next generation of desktop computers in early 2008, starting with our buildings in the UK. By the end of March 2008 we had installed 500 computers at our King Charles Street and Hanslope Park sites. We will start installing these computers overseas in summer 2008 at three pilot posts – Athens, Tbilisi and The Hague. Staff in the UK and at those posts involved in the pilot are looking at how this new technology will help generate different ways of working through collaborative tools, mobile technology and a faster, reliable network.

At the same time the FCO will continue to invest resources into making our present network faster and more reliable. We are improving performance, including, among other things, reducing the number of our posts that rely on satellite links back to the UK.

In 2007/08 the FCO also:

• helped UKvisas to successfully roll out biometrics technology
• continued to develop our intranet and web platforms to offer improved services to staff and the public
• launched the latest version of our confidential laptop solution for UK and some overseas users and
• significantly expanded our network of secure videoconferencing facilities.

Security and estates

Security has a significant impact on almost all areas of major change across the FCO. We are committed to taking an imaginative and flexible approach on security policy to meet these new challenges. In 2007/08 this was a major factor in the following areas:

• putting into practice the recommendations from an internal review in a 2004 report on security
• Improved security arrangements in the FCO reception area
• introduced a new security vetting process in overseas posts for locally recruited staff
• improved security training programmes to better prepare staff and increase security awareness; the FCO also included staff from the Prime Minister’s Office, DfID and other government departments on our training courses on hostile environments
• contributed to DfID’s 2007 review of security, which resulted in a closer and more joined-up relationship on issues of security management and
• delivered better physical protection in Whitehall with Government Security Zone partners.

On our estate of properties, we have continued our programme of investment. In 2006/07, we invested £21 million and £63.1 million on the home and overseas estate respectively. Estate running costs totalled £251.6 million (see chart below). The FCO continues to work towards Treasury asset recycling targets: gross proceeds from sales of underperforming or surplus property in 2006/07 amounted to £57 million and we expect sales of around £14 million in 2007/08

The FCO has also:

• completed new offices for our posts in Almaty, Amman, Geneva, Istanbul and Taipei; completed new offices and residence in Doha; and finished new staff accommodation in Islamabad and Karachi and
• started fitting out new offices for the Deputy High Commission in Mumbai and begun to build a new embassy in Warsaw.

Sustainable operations in the FCO

The FCO is determined that all aspects of its operations at home and overseas are managed in a sustainable way. In other words, we believe that environmental considerations must be at the heart of the way we are run. Not only is this necessary if we are to meet wider government targets and legal obligations on the sustainability of the government estate, but it will give credibility to our efforts in support of action to tackle climate change.

Work on sustainable operations in the FCO is steered by a senior Sustainability Board and we take part in the cross-Government Sustainable Procurement and Operations Board.

The FCO is working with the Office of Government Commerce, which was given the task by the Cabinet Secretary, Sir Gus O’Donnell, to raise government performance against the Sustainable Operations in the Government Estate targets. These targets set out the course for achieving carbon neutrality (net carbon emissions of zero) by 2012. We need to improve our performance against many of these targets, but our excellent performance against recycling targets was noted by the Sustainable Development Committee in its recent report on Sustainable Development in Government 2007.

The FCO introduced an environmental management system under ISO14001 to our offices in London during 2002 and 2003. In 2007 we extended this system to our site at Hanslope Park near Milton Keynes and to 20 volunteer posts overseas. The overseas roll-out has highlighted the need for us to improve our data collection on sustainable operations and to provide clear and accessible information on what we expect from individual officers. We will be further extending the system overseas over the next five years. In March 2008 the FCO stopped providing bottled water at meetings.

The Carbon Trust undertook a carbon audit of the FCO’s UK estate in December 2006 and we are continuing to put their recommendations into practice. The most significant recommendation is the proposal to erect a wind turbine at Hanslope Park, although this would depend on feasibility studies and planning permission. All our new building projects, both in the UK and overseas, are designed to achieve a BRE Environmental Assessment Method (BREEAM) ‘excellent’ rating, and the Carbon Trust congratulated us on the sustainability of our new embassy in Doha during their recent visit.