Deposit return scheme for Scotland: full business case stage 1

5 Management Case

Management Case key messages

This Management Case is focussed on the management of the programme of work in place to develop the preferred scheme design and structure of the scheme administrator.

The Full Business Case Stage 2 will detail the governance arrangements for the Scheme Administrator, including regulation, benefits realisation and post programme evaluation.

The key areas explored in the Management Case of the Full Business Case (FBC) Stage 1 are summarised below:

• Programme management arrangements
• Change management
• Benefits Realisation
• Risk management
• Communications
• Project evaluation reviews
• Gateway review arrangements

5.1 Introduction

5.0 This Management Case describes the management arrangements put in place by the Scottish Government and Zero Waste Scotland to build the Strategic and Socio-Economic Cases to develop a DRS for Scotland and to identify a preferred scheme design and delivery model (FBC Stage 1). It also sets out the approach to risk management and external assurance approaches such as the Gateway Review process which have been undertaken to date and which will continue to be applied throughout the life of the programme.

5.1 The DRS is recognised as being a complex multi-organisational programme, beginning with supporting the establishment of a private sector Scheme Administrator. The establishment of the DRS involves:

• Development of governance arrangements.
• Communications and stakeholder management.
• Supporting the establishment of the Scheme Administrator as an organisation.
• Operational arrangements and facilities management at the Scheme Administrator's location.

5.2 The Management Case outlines the current arrangements within Zero Waste Scotland and the Scottish Government while initial design and planning progresses. This case covers:

• Programme management arrangements.
• Change management.
• Benefits realisation.
• Risk management.
• Communications.
• Project evaluation reviews.
• Gateway review arrangements.

5.2 Programme Management Arrangements

5.3 The project will be managed in accordance with recognised project management methodologies such as Projects in a Controlled Environment (PRINCE2) and Managing Successful Projects (MSP). The project is under the overall control of an experienced programme director whose sole responsibility is the successful delivery of the project and who is therefore able to give the project the required level of senior management attention. The programme director reports to the senior responsible owner (SRO) of the DRS, the Deputy Director of the Scottish Government's Environmental Quality & Circular Economy Division.

5.2.1 Structure and Governance

5.4 The governance model for the delivery of the FBC Stage 1 is detailed below, which will evolve to support the more detailed business and implementation planning required to deliver the FBC Stage 2.

5.5 The project governance and management arrangements are illustrated in Figure 15 below:

Figure 15: Programme Management Structure

5.2.2 Roles and Responsibilities

5.6 The role and responsibilities of key governance and management groups in the structure are summarised below:

DRS Programme Board

5.7 The DRS programme board is responsible for providing strategic direction and overseeing the successful delivery of the programme.

5.8 The board meets monthly, or as necessary. It is accountable to Scottish Government.

Zero Waste Scotland Board

5.9 The board's role in the governance of Zero Waste Scotland is to ensure that the organisation strives for excellent performance in accordance with board-approved performance standards, whilst appropriately balancing performance with responsible legal and other conformance obligations.

5.10 The board is responsible for the provision and management of Zero Waste Scotland's resources to the DRS programme. This involves:

• Approval and oversight of the resources allocated to deliver the DRS programme agreed with the DRS Programme Board.
• Holding the Zero Waste Scotland DRS team to account for delivery against the agreed performance management framework and ensure underperformance is addressed quickly.
• Ensuring that the full potential of the DRS programme is realised across Zero Waste Scotland's outcomes.

5.11 The Zero Waste Scotland board meets on a two-monthly basis.

Implementation Advisory Group

5.12 This group provides guidance and direction on the process of establishing operation and administration of the scheme. It is chaired by the SRO and includes representatives of the drinks manufacturing and retail industries alongside the programme director and start-up director.

5.13 Established in February 2019, the implementation advisory group has no governance responsibilities but will:

• Provide industry expertise and advice on the implementation of the DRS for Scotland.
• Facilitate access to expertise and resources from participants within the group and their broader networks.

5.14 The organisations represented are:

• The British Soft Drinks Association.
• Federation of Small Businesses.
• National Federation of Retail Newsagents (NFRN).
• Natural Hydration Council.
• Scottish Beer and Pub Association.
• Scottish Grocers Federation.
• Scottish Licensed Trade Association.
• Scottish Retail Consortium.
• Scottish Wholesale Association.
• Scotch Whisky Association.
• UKHospitality.

Programme Management Structure

5.15 The programme is managed through the programme management structure outlined in Figure 16 below.

Figure 16: Project Management Structure

Programme Director

5.16 The programme director is responsible for the day-to-day management and delivery of the DRS programme and reports to the programme board and the Zero Waste Scotland board.

Programme Management Office and Group

5.17 The programme director is supported in this role by the programme management office. The project management office provides the project management processes and controls required to support the delivery of the project and monitors and reports on progress.

5.18 The programme management group consists of the programme management office as well as project and workstream leads and representatives of organisations providing resources to the project including the Scottish Government and SEPA. The programme management group meets fortnightly or as necessary.

Projects and Workstreams

5.19 The programme comprises several projects and workstreams which are detailed below.

5.20 Led by the start-up director, the implementation work is informed by the implementation advisory group and comprises eight work packages organised under operations and administration. These are:

• Operations - comprising:
  • Logistics and locations.
  • Interaction with existing production and distribution arrangements.
  • Fraud prevention.
  • Data and ICT.
• Administration - comprising:
  • Scheme Administrator.
  • Financing.
  • Procurement.
  • Socio-economic benefits.

5.21 These are supported by several workstreams including communications and high-level stakeholder engagement which will continue throughout the lifetime of the programme and are detailed in Section 5.6 below.

5.22 A separate workstream focused on links with extended producer responsibility ensures that policies being developed in Scotland which may impact on the DRS are complementary. It also maintains contact with developments being considered in England and Wales by liaising with Department for Environment, Food & Rural Affairs (DEFRA) officials.

5.23 Two additional short life projects are:

• Legislation - informing the legislation which will establish the Scheme.
• FBC Stage 1 - securing Ministerial approval for the FBC Stage 1.

5.3 Change Management

5.24 Change management associated with the programme will be managed through the programme board. Day-to-day change management of service issues will be discussed at the programme management group and any resultant programme changes will need to be approved by the programme board and Zero Waste Scotland board.

5.4 Benefits Realisation

Proposed Benefits Realisation Plan

5.25 The delivery of benefits will be managed through the programme board, using a proposed benefits realisation plan (BRP). This indicates who may be responsible for the delivery of specific benefits, when they may be delivered and how achievement of them may be measured.

5.26 The BRP provides the means by which the board will ensure that the potential benefits arising from Scotland's DRS may be realised and will demonstrate that the investment has been worthwhile to key stakeholders.

5.27 The BRP will be further developed in the FBC Stage 2.

5.5 Risk Management

5.28 Risk management serves as a mechanism for risk reduction. By taking a proactive approach to managing risk exposure, the board ensures protection of operational and reputational risks. This programme will be managed in that context.

Risk Management Policy

5.29 The programme risk register describes and evaluates significant risks that may affect achievement of the programme objectives and outcomes. The risk register is managed by the PMO and is used as a tool for managing risks that would potentially impact on programme delivery. It is reviewed regularly by the programme management group and the programme board.

5.30 The risk register nominates an 'owner' for each risk who is responsible for the management of the risk and the required mitigations.

5.31 The key risks to the delivery of the project are shown in the Strategic Case at section 1.4 above.

5.6 Communications

5.32 There is a range of stakeholder groups, including consumers, who have an interest in the introduction of a DRS and how this is delivered.

In recognition of this profile, a communications strategy and a high-level stakeholder engagement plan have been developed for the programme. This section of the FBC provides a summary of this strategy and plan.

Communications Strategy

5.33 Communication is a dedicated workstream for the programme, supporting all other projects and workstreams. There is a standing item on the agenda for meetings of the PMG, programme board and Zero Waste Scotland board and this provides the opportunity for detailed discussion on communication issues with a range of key partners.

5.34 The communication strategy forms part of the work of the programme board in helping to inform, educate and influence a wide range of stakeholders and the public to enable an understanding of how the scheme design delivers on the agreed principles.

Stakeholder Engagement Plan

5.35 Stakeholder engagement is a dedicated workstream for the programme and ensures that key stakeholders are kept up-to-date with the progress of the project. The objectives are to ensure stakeholders are aware of developments within the programme, can maximise the benefits and minimise the impacts of a DRS. The plan will maintain regular communication with key stakeholders through the following approaches:

• The implementation advisory group engages industry representatives to provide expertise and advice on the implementation of a DRS for Scotland.
• Attendance at key stakeholder meetings including conferences to maximise the reach of stakeholder engagement.
• Regular meetings and/or calls with stakeholders (both representative associations and individual organisations) to ensure they can input into the scheme, receive updates on progress and update the programme on their progress on DRS.
• Stakeholder engagement activity is undertaken by the Scottish Government and Zero Waste Scotland.
• Updates on engagement are provided to the PMG and programme board.

5.7 Project Evaluation Reviews

5.36 The DRS is a significant programme for Scotland and will run over a lengthy period. Within the programme itself there are distinct phases. In view of the complexity and length of the programme, reviews will be conducted at the conclusion of key stages. This is to ensure that there is a systematic analysis of the processes and procedures employed at each stage, an identification of lessons learned and the incorporation of these learning points into subsequent phases of project delivery.

5.37 These key stages are:

• Completion of the FBC Stage 1.
• Completion of the FBC Stage 2.
• Establishment of the Scheme Administrator.

5.38 Reviews will be conducted by the programme director with input from the programme board, other project team members, specialist advisors and operational staff. The outputs of these will be reported to the programme board.

5.39 Over time, the management arrangements for the DRS will transfer to the Scheme Administrator. Responsibility for the execution of any remaining reviews will therefore pass to the appropriate governance structure.

5.40 In addition to the planned Project Evaluation Reviews it is anticipated that the Scheme Administrator's internal auditors will, as part of their yearly programme of audit work, review project management arrangements from time to time.

Post Implementation Review

5.41 These reviews ascertain whether the anticipated benefits have been delivered.

5.42 The Post Implementation Review (PIR) takes place after all of the planned changes have been put in place and allowed to bed down, although there is a case to be made for conducting at least a two-stage PIR, in order to allow both an early and then a more mature evaluation of the delivery of project benefits. The PIR takes as its starting point the benefits realisation plan and describes to what extent the benefits identified are being achieved.

5.43 An initial PIR will be conducted 6 to 12 months following establishment of the Scheme Administrator, and again 12 to 24 months later. Since the Zero Waste Scotland project team will have been disbanded at this point and it is unlikely that there will be sufficient resource available within Zero Waste Scotland to conduct this work, external support will be commissioned to undertake this work at an appropriate point.

5.8 Gateway Review Arrangements

5.44 The Scottish Government will utilise the Gateway Review process throughout the lifetime of the programme.