Phase Two: Organisational Review: Final Report

22 August 2003

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Recommended MCA/ESS Branch Structure

• Overview of Proposed Structure
• Energy Safety Service - Relationship to the Ministry of Consumer Affairs
• Policy Team
  • Background
  • Recommendation
• Research, Information and Capability Group
  • Recommendation
• The Information and Capability Team
• Measurement and Product Safety Service
• Branch Support
  • Contact Centres
  • Communications
  • Administrative Support Team
  • Head Office
  • Regional Offices

Overview of Proposed Structure

21. The following diagram represents the recommended branch structure for the Ministry of Consumer Affairs and the Energy Safety Service.

White text indicates that the position is either new or subject to change in location, scope or responsibility.

# Senior Advisor Product Safety retained in MAPS team for 10-month transition period after which if budget bid successful, position moves to policy team as an untagged Senior Advisor position.

* Fixed term contracts to December 2003

In summary, the rationale for the proposed structure is:

• Creation of a flatter management structure with clearer lines of accountability and greater clarity around roles, particularly across the former "standards and safety service".
• Structure clearly supports a managerial leadership approach where managers are expected and supported to "lead" rather than "do".
• Responsibility for all strategic and substantive policy is combined under a single policy manager with the aim of greater cross-fertilisation of ideas within and between teams. (Where strategic policy, operational policy and operations proper sit with the same team it can reinforce a silo approach because the business unit is largely self-sufficient).
• Supports a refocusing of the Consumer Information Service on developing an in-depth understanding of consumer issues and the way consumers and traders interact, and on gathering and analysing information for the entire branch, not just certain aspects of consumer law.
• Supports greater interaction between teams as no one team can be seen to be self-supporting. All teams require an interaction with the Research, Information and Capability Group for research and data analysis and information dissemination purposes. The Policy team needs the operational teams and the Research, Information and Capability team in order to test the workability of policies. Energy Safety and the Measurement and Product Safety teams have common areas of responsibility in terms of electrical and gas appliance safety and measurement issues with respect to fuels. The MAPS team will need to have a relationship with Policy in order to progress their scope of measurement project.
• Promotes a more efficient use of administrative support and information and communications personnel and resources across the branch. Linking the admin support personnel to the Strategic Business Advisor position means that resources can be allocated to branch priorities rather than being focussed entirely on the work of a particular team.
• Use of the contact centre should free up both advisor and admin support time. It also has the potential to deal effectively with the risk that the rapidly escalating email traffic via the website distracts advisors from higher priority work. It will also provide a means of logging calls/emails across MCA/ESS thus providing an additional source of data.

22. Details of each of the functional areas and position groupings are provided throughout the remainder of this section of the report.

Energy Safety Service - Relationship to the Ministry of Consumer Affairs

23. Before moving on to other areas of the Branch, I would like to focus on the relationship between the Energy Safety Service and the Ministry of Consumer Affairs. The conclusion I have reached is that while the Energy Safety Service is part of the same branch as MCA and shares the same General Manager, it is not part of MCA. The Ministry of Consumer Affairs is a semi-autonomous body with a particular focus on consumers. The Energy Safety Service has a much broader focus on energy safety outcomes for the public as a whole. As noted in Creating Confident Consumers, there are definite areas of mutual interest, particularly around appliance safety and some measurement issues. As parts of the same branch it is important that these parts of the two entities exploit the opportunities for joint work in the areas of mutual overlap to the benefit of consumers and the broader public.

24. The Building Review may have implications for the Energy Safety Service. Depending on where responsibility for Building policy ends up, the ESS could find itself either part of a Ministry of Housing and Building Construction or part of a branch of MED focusing on Building, along with other things. However, should Government decide on a Ministry of Housing and Building Construction, it now seems unlikely that ESS would move to this new entity until 2005, if at all.

25. It is my view that considerable effort needs to be put into improving the operational systems within ESS, and that this should be the first priority of the Manager Operations. For this reason I have determined not to place the ES policy team under the Manager, Operations responsibility at this time. I have also considered continuing with the current arrangements where the ES policy team effectively reports to me. I have concluded that there is a significant risk that this will result in my focus being drawn away from strategic branch-wide issues. I have instead determined to place the ES policy function within the branch Policy Team. I see that this arrangement has considerable benefits in terms of alignment of policy effort where there are overlaps between areas of interest, such as with occupational licensing. It also means that the Energy Safety policy advisors have the benefit of working within a group which is very familiar with policy disciplines.

26. However, I want to stress that while the energy safety policy advisors are based in the policy team, it is essential that they continue to have a close working relationship with ESS operations, including the usual business planning processes.

27. Over the next few months I would also like to see the Manager ESS Operations and the Manager, Measurement and Product Safety identify and implement ways in which the product safety personnel from each service can support each other.

Policy Team

Background

28. The policy team was reviewed in 29 July 1997. As a result of this review, and the earlier decision to move the Consumer Safety function (largely operational policy) from Policy into Trade Measurement, the Policy Team was refocused to become a considerably smaller, policy project team with a focus on undertaking strategic and substantive projects. The Manager's position was changed to that of Chief Advisor, Policy Projects. A key point made in the review was that the "leadership role will change in emphasis from manager to leading practitioner". It is my view that the change in approach was right for the time. The projects approach has resulted in the achievement of some significant policy wins, most recently the Motor Vehicle Sales Act, the Fair Trading Amendment Bill, the Consumer Guarantee Act amendment and soon, it is hoped, the Consumer Credit Act (or whatever it ends up being called).

29. The time, has come, however, to build on these successes and take the team to the next level.

• Chief Advisor is constrained in his ability to "manage". The small size of team coupled with the expectations of the role as "lead practitioner" mean that the role is often "pulled down" into output production rather than output management. The position of Chief Advisor Policy projects is also inconsistent with the MED wide approach to leadership and role clarity, which sees the primary role of managers as managerial leadership as opposed to being a "lead practitioner".
• Focus on policy projects coupled with small size of team means that the team does not have the resource to both undertake projects and monitor the policy area as a whole.
• It is very vulnerable to the loss of key staff (one staff member can make a significant difference) as the ability to "understudy" in roles is limited.
• Policy team does not maintain an overarching interest in all consumer-related policy. Consumer Safety and Trade Measurement strategic policy advice (albeit on few occasions) are delivered from the Trading Standards Service. Operational demands on these services mean that strategic policy projects, such as the scope of measurement activity and work on the framework for thinking about product safety are generally squeezed out.

Recommendation

30. Under the recommended structure, the Policy Projects team expanded into a larger Policy Team. Its focus remains on strategic and substantive policy, but it is expected to take a broader interest in projects outside pure consumer policy that nonetheless may have a significant impact on consumers, particularly in the area of economic development. It will be critical that, in expanding, the team does not lose its focus on undertaking significant pieces of work with the potential to make a major difference for consumers as a whole. This will require excellent strategic prioritisation.

31. Under the recommended new structure, the current position of Chief Advisor, Policy Projects [4] will be disestablished and two new positions, Manager, Policy and Chief Advisor will be established. The position of Senior Advisor, Consumer Safety will also be moved into the Policy Team after a 10 month transition period as an untagged Senior Advisor.

32. As part of the Building Review work, the Ministry of Consumer Affairs will be a key part of a project looking at developing a framework for occupational regulation in the Building industry. Additional resource has been provided to allow the recruitment of a new Senior Analyst to help assist with this work.

Research, Information and Capability Group

33. Creating Confident Consumers has indicated the need to refocus the Consumer Information Service on gathering information to enable the wider Ministry of Consumer Affairs to develop robust policy advice that works for consumers, suppliers and industry in general. The Group will continue to have a dual purpose. The first is to ensure that consumers and traders have access to an objective, accurate source of information and advice about their rights and obligations, including any changes in these resulting from new regulation. The second is to ensure that policies impacting on consumers either directly or indirectly are informed by an in-depth understanding of consumer and supplier behaviour and experience, emerging consumer issues and market practices. In particular, the "new CIS" will be focused on developing impact assessment measures to allow evaluation of the extent to which policies and programmes are achieving their objectives.

Recommendation

34. It is recommended that the Consumer Information Service be renamed Research, Information and Capability Group.

35. The group would be sub-divided into two teams, a Research Evaluation and Monitoring Team, and an Information and Capability Building Team. The Manager's role could be either a generalist manager or someone with expertise in either research or evaluation or information and capability building. What is critical to the Manager's job is the vision to see what might be possible and to plan to get there. Technical expertise can be provided through the Research/Evaluation Advisor and the information personnel.

Research Evaluation and Monitoring Team

Purpose: to understand the reality of how consumer and suppliers interact in the New Zealand marketplace, and the impact of consumer policy and outputs on consumers transacting with confidence.

36. Issues have been raised about the size of the Advisor, Consumer Issues roles. It is not the intention that individuals undertake every aspect of their role at once. Each year in the context of team planning and individual performance expectation setting, priorities will be accorded to particular issues or communities. This mechanism will be used to manage workload issues. In addition the funds set aside for the Training Trainers project in the first year of operation will be retained as a "special projects" fund. Where particular issues like home buy-backs emerge, this fund can be used to absorb the additional work. The "training trainers approach" is also at least partially aimed at reducing the workload of the Advisors, Consumer Issues as the bulk of this work falls to them currently. It is also hoped that the Contact Centre will reduce some of the work load for this group.

37. Initial priorities for the new research component of this team would be to develop impact assessment methodology and exploit the data available from MCA/ESS and other consumer-related agencies. The team will also need to focus on developing methodology for the evaluation of the Motor Vehicle Sales Act and sometime later, the Consumer Credit Act.

The Information and Capability Team

Information and Capability Building Team

Purpose: to ensure that consumers, industry and the general public where appropriate have access to information and advice on their rights and responsibilities. This purpose encompasses the direct provision of information and building the capability of third party groups and organisations and communities to provide information and advice to their communities and constituents. It also has a strong focus on using the consumer representation network as a "radar" re consumer and market issues as well as a mechanism for sourcing high quality consumer representatives.

38. The capability of the business community to understand and deal appropriately with consumer issues is an important issue. It is expected that the Team Leader and Manager will work with the Business Services Branch of MED to identify ways in which they can work together to ensure that businesses are more aware of their rights and responsibilities regarding consumers.

39. Responsibility for more "administrative functions" such as resource stock maintenance, ordering reprints or photocopies or gathering quotes would either be undertaken by the administrative support team or the Contact Centre (see below).

Measurement and Product Safety Service

40. Creating Confident Consumers recommended that the General Manager "move quickly to address capability issues within the Trade Measurement team that threaten the integrity of the national measurement infrastructure". The changes proposed are designed to address the following issues:

• Lack of clarity over the role of the Manager, Trading Standards Service in relation to that of the Manager, Standards and Safety.
• Perceived need for greater people and team leadership coupled with issues of span of control and regional isolation. Manager needs to be able to focus more on staff, directional management and leadership than project or technical work.
• Manager undertaking policy analysis work with respect to consumer information standards (labelling) resulting in a crowding out of appropriate work of role.
• Very low turnover combined with low levels of training has given rise to a significant capability risk.
• Low levels of surveillance reduce incentives on industry to put in place or maintain appropriate measurement processes leading to inaccuracy and wastage. Reduced incentives to adhere to good practice also threatens the accredited person's infrastructure as industry is reluctant to pay for services as risk of "being caught" is minimal.
• Further it is proposed to take to the next level the relationship that has been developing between the trade measurement function and consumer safety. There is a need to address resourcing issues with respect to the consumer safety infrastructure. At the same time it is important to address issues of succession planning that arise from having almost all the knowledge of consumer safety issues contained within the person of the Senior Advisor Product Safety. The proposal put forward is designed to address capability issues in the consumer safety operations and strategic policy areas, and provide for career development options.

Measurement and Product Safety Service

Purpose: to ensure that consumer's get what they expect from a transaction in terms of accurate weight or measure and a product or service that is safe if used as intended.

41. In the draft OIR report it was proposed that the Senior Advisor Product Safety (SAPS) move into the Policy team in order to focus (at least initially) on strategic product safety policy. During the feedback period and before, I had considerable discussions with the incumbent SAPS and members of the trade measurement team.

42. Decisions in this area have been difficult for two reasons. First, it is plain that the Senior Advisor, Product Safety is, due to her skill and experience, able to efficiently deal with issues that may require more resourcing if others were to take on the responsibilities. What is not entirely clear is how much more and at what level. Second, under the proposed approach, the MAPS Team Leaders would pick up the responsibility for negotiating voluntary action and/or intervention with traders, importers or manufacturers of problematic products. It is anticipated that these Team Leaders will have had significant experience negotiating weights and measures issues with senior executives and would be well-placed to do this work.

43. It is also expected that MAPS officers would progressively take over responsibility for developing or reviewing some product safety standards, particularly those resulting from specific investigations carried out by them. They would also undertake networking activities in the regions. However, the ability of the regional MAPS network to take on additional "head office" product safety functions is to a large extent dependent the proposed budget bid for 4 additional staff. The proposal is also very dependent on the transfer of knowledge from the current Senior Advisor to new and existing MAPS personnel.

44. For these reasons I intend to proceed with the proposal but use a 10 month transition period. During this time the Senior Advisor Product Safety would be based in the MAPS team and would:

• Assist the Manager, MAPS with the recruitment and selection of the Advisor, Product Safety and fine-tune the consumer safety accountabilities of the MAPS network.
• Contribute to the development of the business case supporting the bid for 4 new MAPS personnel including any adjustments necessary to take account of new information.
• Work with key product safety personnel within the Energy Safety Service to ensure possible task sharing strategies.
• Provide in-depth training to the new Advisor, Product Safety, the Team Leaders and MAPS officers on consumer safety issues.
• Complete the Consumer Safety Compliance manual, including any additional material necessary to support work of the regionally-based officers.
• Progressively hand-over responsibility for consumer safety operational functions to the Advisor, Product Safety and other designated members of the MAPS.

45. Should the Budget bid be successful, the Senior Advisor will move into an untagged Senior Advisor (Policy) position in the policy team. Initially it is likely that due to their previous experience the new Senior Advisor would undertake strategic work on consumer safety issues. Over time this would cease to be the case.

46. Should the Budget bid be unsuccessful, the decision to move the Senior Advisor would need to be reviewed. The activities undertaken over the transition period would, however, be largely necessary regardless of what arrangements are put in place.

Branch Support

47. As noted on a number of occasions, one of the characteristics of the Ministry of Consumer Affairs/Energy Safety Branch is the way in which it is organised into "silos". This extends to support people. Each team has either its own support people or makes use of support team members in an adhoc way. Accountabilities are confusing. It is my view that there is the potential for considerable efficiency gains through creating a centralised team of administrative support staff. I have given some thought to a structure that balances the need for greater flexibility with the desire of the admin support team to be part of the "work group" that they are supporting.

48. It is proposed that the Branch Support activities be reorganised in the following way to improve efficiencies and coordination while maintaining clear accountabilities.

Contact Centres

49. In 1997, a decision was taken to move away from the provision of a free telephone consumer advice service. Much of the resources of the then Operations Section were taken up with the Consumer Advice Service, which received around 50,000 calls annually. There is a risk emerging that email traffic, through the MCA website, could build up to similar proportions. The last year has seen email traffic to CIS alone almost triple from 521 in 2001/2002 to 1,421 in 2002/2003. This does not include Scamwatch traffic. Currently we have at least one administrative support person sending back standard responses.

50. In the draft OIR I proposed that the entire MCA/ESS Branch move to using the Contact Centre in Christchurch for all practicable forms of correspondence/communication that can be dealt with through the provision of standard responses or in situations where a messaging centre is currently used. The Contact Centre staff will be trained in providing responses to basic enquiries, including standard responses to email correspondence. They will also handle all requests for pamphlets/brochures etc. After investigating the feasibility of this approach further with the assistance of the Contact Centre Manager, I am now comfortable with proceeding to use the Contact Centre to filter specific inbound MCA and ESS calls and emails commencing 1 November 2003. The approach would be phased in beginning with the Research, Information and Capability Group.

Communications

51. There are currently two Communications positions within the branch. One is focussed on the Ministry of Consumer Affairs, the other on the Energy Safety Service. Both positions are responsible for developing a communications strategy for their respective areas. Both manage significant contracts and are the first port of call for media inquiries. The ESS position probably undertakes more content development than that in MCA.

52. I am now recommending that these two positions be collapsed into one. The Communications Manager position will be re-titled Senior Communications Advisor (MED policy is to reserve the term "manager" for people with line management responsibilities). The position will be responsible for communications issues across the whole branch. Position of Communications Advisor, ESS would be dis-establised. As noted earlier, the information and resource production functions of this position will be undertaken largely through the Information and Capability Building Team in the Research, Information and Capability Group. The Senior Communications Advisor will be responsible for:

• Developing and reviewing a Communications Strategy for MCA/ESS consistent with the branch strategic direction and the strategic direction of MED, including strategies to improve information flows to consumers and traders through leveraging off the media.
• Developing processes and procedures to ensure that all information and communications material produced by the Branch meets quality standards.
• Developing and reviewing a Relationship Management Strategy for the branch.
• First contact for all media enquiries, and sourcing "experts" to deal with calls.
• Responsibility for developing and maintaining effective working relationships with the media, communications personnel based in Parliament or in relevant industries or government agencies, and MED Corporate Communications. The Senior Communications Advisor would attend the MED communications team meeting convened by the Director, Communications. The Director, Communications has been given leadership responsibility for the formation and oversight of the MED communications strategy. As such, it will be essential that the Senior Communications Advisor works closely with the Corporate Communications staff.
• Contract Management where this pertains to strategic projects.

Administrative Support Team

53. In the draft report it was proposed that the Strategic Business Advisor assume responsibility for managing a centralised administration team in addition to her current responsibilities with respect to the Finance Analyst. Under the proposed process, each branch work unit will have an allocated administrative support person. Each Monday or Friday, that person will meet with the relevant manager to discuss his/her team's needs for that week. These needs will be brought back to the administrative team, prioritised and allocated to particular staff members. Conflicts over priorities will be managed between the Strategic Business Advisor and the relevant manager/s.

54. I have given careful consideration to the submissions on the proposal. In particular I have focussed on the health and safety concerns that it was suggested would result from having fewer staff to deal with the branch workload.

55. I remain convinced that the concept should be pursued. For this reason I am recommending that we adopt the following approach which varies in some respects from that in the draft report.

Head Office

• Admin support staff in Head Office will reduce to three positions as proposed in the draft report. The Admin Support Team will report to the Strategic Business Advisor who will essentially coordinate their work.
• Each admin support person will be assigned as a contact person for a team on the following basis:
  • 1 person for the Policy team and the MAPS team
  • 1 person for the Research, Information and Capability team and
  • 1 person for ESS Operations.
• Support people would be located with the teams that they are the contact person for. They would attend team meetings and meet regularly with team managers to ascertain the level of work required.
• Staff wanting support could go directly to their contact person to request assistance or to the Strategic Business Advisor. The request would be serviced from the team resource rather than necessarily from the team contact person. The onus would be on staff to be very clear in their request to facilitate an appropriate response. The Admin Support Team would then meet the support need as flexibly and efficiently as possible.
• Managers would be able to negotiate for PA services with the Strategic Business Advisor.

The Strategic Business Advisor would monitor team workloads and provide feedback to the General Manager on any changes necessary to address workload or other concerns.

Regional Offices

It became very apparent during the feedback sessions in the Manukau office that the support person provides a critical service in terms of managing incoming Pacific Island hotline calls including dealing with many of the less complex inquiries directly. With the Auckland Advisors, Consumer Issues reducing from three to two it will be important to have someone dealing with the incoming calls and requests for assistance. As a result I propose that the support staff quotient in the Manukau office be adjusted back to the original 0.8 FTE. The admin support person would report to the most senior Advisor, Consumer Issues.

With respect to the Southern Business Centre, I have arranged with the Group Manager, Business Registries, that the MCA and ESS staff will be supported through the Centre support staff.

[4] For an explanation of the difference between a Chief Analyst and a senior advisor, and the rationale for having a Chief Analyst, see Appendix Five.

[5] Where negotiations with firms are at a particularly senior level or are particularly contentious, these would be dealt with by either a Team Leader or, in exceptional circumstances, by the Manager.

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