The Case of Rural Payments Agency

Subject: Risk Management
Pages: 11
Words: 3095
Reading time:
12 min
Study level: PhD


The following paper highlights the similarities and the differences in the program and project management techniques employed by the OGC & Rural Payments Agency and those recommended in the presentations. The reason for the recommendations in the presentation is also provided along with how the Rural Payments Agency could have made better use if project management techniques.

Aims and Objectives

The aims and objectives that were set out by the Rural Payments Agency focused on the development of a customer focused paying institution where effectiveness and leadership was to be drawn from an authoritative source in order to support the policy makers. The Rural Payments Agency saw it as their vision to be able to come up with a customer centric system that facilitates payments. The Rural Payments Agency set the objective of the program to significantly streamline the functions pertaining to the HR and Finance while reducing the level of people employed from 3300 to 1950. The company also made it an objective to reduce the number of regional centres that they had in the region from the current twelve to a prospective five. This objective was aimed at controlling costs and limiting the expenses of the project to make it possible to reap profits and returns form a limited investment in the region.

The company also had established objectives to improve the level of staff and the customer satisfaction. This was aimed at improving the level of customer loyalty and increasing business while also increasing the productivity form a limited work force.

Through the Rural Payments Agency program the company also aimed to reduce the time that it took the farmers to access their payments and complete the claims that they had for their CAP payments. This aim supported the objective of the company to increase customer satisfaction and streamline the operations of the company particularly in the HR and the finance functions.

The presentation on the other hand highlighted that issues that were being faced in the first place. The presentation and the made recommendations highlighted that the driving forces for project management at the company were the already existent inefficiencies that were present in the processing of claims and the obvious need for an automated and standardize method of working. The existing inefficiencies that were present in the claim processing system made it tedious for the farmers to receive the CAP for their claims. Technology has often been used to make standardizations and stream line business processes and this was an obvious need that was highlighted in the presentation. Technology can be applied to business processes and functions “as means to cut down costs associated with payroll procedures introduced by human resource” (‘Tips on Using Technology to Streamline Payroll Processes–and Cut Costs’, 2006)

The aims and objectives that were recommended for the program in the presentation pertained to improving the present system in order to improve the process of payment of the subsidies for farmers. This would enable the farmers to access the required funds through the subsidies in time for the sowing and the cultivation of their crops. The second aim that was highlighted in the presentation was to decrease the number and the volume of cost overheads at the company, specific to processing claims for the farmers. The reduction of the cost overheads further triggered the satisfaction of the as is highlighted in the presentation pertaining to increasing the efficiency of the processes.

The aims and objectives highlighted in the case for the Rural Payments Agency as well as those highlighted in the presentation as recommendation for the Rural Payments Agency were formed on the same lines. Both promote increase of productivity, reduction in inefficiency and reduction in time that it takes for the farmers to access their subsidy claims. However it is worth noticing that the aims of the Rural Payments Agency as in the case focused on the customer orientation of the company and its operations while the recommendations focus more on using technology to support the streamlining of the business processes.

Management of Risk

The Rural Payments Agency case highlighted that the risk management that was employed pertaining to following a standard practice. In the case the internal reporting mechanism were standardized to reduce risk. Additionally the company also took opinions and assurance form external sources along with the gateway reviews to determine how the risk at the company could be managed for the purpose of project management. The actions that were recommended by the external sources provided the Rural Payments Agency with the specific recommendations with which they could better manage risk but no long terms effects or influences were highlighted.

The risk management initiatives by the Rural Payments Agency pertained to taking action against the risks that existed in the delivery timetable for the SPS that was currently not being met by the Rural Payments Agency. However the company did not forecast as to how the behaviour of the customers would impact the operations of the business and how the implementation of the new information technology based processes and infrastructure would affect their aims and objectives. The company did not properly estimate the extent to which the IT could increase the risks of their operations or impact their business processes. The main reason for this was the insufficient investment by the company to make the business ready for the technological changes.

The presentation highlights the shortcomings of the risk management employed by the Rural Payments Agency in the case. The shortcomings that are listed pertain to the poor identification of the market by the company, the poor identification of the objectives and the failure of the company in predicting the possible changes that could occur and the development of the alternative routes that the company could take in these situations. The company did not project on how the customers would take to the changes and what their resultant behaviour would be like to the end product. This combines with their lack of alternatives for action in case of contingencies led to the unsuccessful result that followed the management of the project.

The presentation suggests improvements that can be made to the risk management function and activities pertaining to managing for contingencies that could have aided the Rural Payments Agency in better managing their project and making it a success rather than a failure due to unpredictable external elements. The suggestions provided pertain to understanding the program form the point of view of the customer. This would have enabled the company to determine how the customers perceive the product and service delivery at the company. Feedback form the customers and their input regarding the changes would have provided the company with insight as to how the customers want the business processes for service availed to be changed to make them more customer friendly. The presentation also highlights that a more detailed analysis could have been taken to understand the scope of the project and the required changes that needed to be made at the initiation of the project itself. “The project approach can be applied to one-time projects that are definable in regards to a specific goal, unique or unfamiliar to the current organization, and critical to the functioning and survival of the company” (Middleton, 1967). The establishment of clear objectives would also have helped the company in working towards a successful final delivery of the service to the customers. The risk management in the Rural Payments Agency case also lacked distinct appointment of roles and responsibilities for the managers and the business heads specially in the project management function. “Team interface management is particularly important during the concept phase of the project. Project structuring and support is most important in the development phase of the project, while hindering team performance in the concept phase” (Hoegl & Weinkauf, 2005). By ensuring that the project management team is assigned its specific roles and responsibilities, the success of the team and the undertaken project can be greatly enhanced.

The Rural Payments Agency case was vague on its identified objectives, the role that the risk management had to play in the project and the roles and responsibilities of the project management team. This is because “given specific software project goals, managers do make planning and resource allocation choices in such a way that will meet those goals” (Abdel-Hamid et al., 1999). This led to a confused management of the project that did not take into account the demands and the requirements of the customers of the company. While the company mentioned in its aims to be moiré customer centric and improve customer satisfaction, the way the company undertook the project led to completely opposite results. The presentation however highlights how the company would have better invested in management and planning to make way for the success of the project.

Program Management Approach

The approach taken by the Rural Payments Agency in the case for the management of the program pertained to managing through governance and program management. The Rural Payments Agency undertook the program management by rationalising the regional offices and the head quarters of the company. This pertained to changing the structure of the company and its operations in the region that had previously worked in the favour of the company. As work progressed on the SPS system to develop the system, the governance structures in place at the Rural Payments Agency were modified. The modifications took the form of creating new forums and reforming the implementation. This brought together the Defra policy and the specific interests of the RPA delivery. The Defra interests were over seen by the executive review group that was established for program management. This group provided support to the program management for the non executive viewpoint. The company however faced increased problems pertaining to the approach that they had taken to project management. The Rural Payments Agency saw that as the number of work streams were reduced the project management roles were changes and re-established to a group of project management and assurance personnel. The procurement of the IT based system that the v employed to stream line their options pertained to the purchase of a off the shelf software. However as the nature of the company and its businesses operations were not standardized, the implementation of the software in the company required significant repetitive changes to be made business processes. As a result the scope of the program fluctuated, resulting in an increase in its scope that made it much harder to manage for the Rural Payments Agency.

The presentation makes recommendation for the program management approach at the Rural Payments Agency. The presentation highlights that the way the program was managed and the approaches that were taken for management were not appropriate as per the aims and the objectives identified by the company and the required outcome that they were looking for. The company did not identify a definite time horizon for the implementation of the programs and its completion, aside form this the company focused on the outputs of the program and the IT procurement software instead of the outcomes that the approach taken towards program management. Moreover the framework and the roles and responsibilities at the organization were also unclear that led to the de-fragmented management at the company and the resultant chaos in management of the project. The focus of the program management was not on an effective and efficient implementation of the program focused on the desired outcomes, instead it was more focused on how and what had to be managed for the output that the company required from the management of the program.

In the presentation it has been highlighted that the Rural Payments Agency could have made significant changes to its program management approach to improve the results. These improvements take the form of establishing a flexible duration for undertaking the program management task. The schedules of the specific tasks required in establishing the system, conducting business process reengineering and attaining the IT based solution, and implementing the IT based solution should have been all planned for with a work breakdown structure which allowed time and resources for any contingencies that occurred. An inflexible program leads to a constrained and ineffective outcome.

“It is essential that change be managed and that balanced attention be paid to all identified factors, including those that are more contextual (e.g., management support and technological competence) as well as factors that pertain directly to the conduct of the project (e.g., project management and process delineation). As one of the first pieces of empirical evidence based on a field study, this research emphasizes the importance of addressing BPR implementation within the broader context of organizational change in a complex socio-technical environment.” (Grover et al., 1995)

A proper planning of the task at hand could have led to a more organized project undertaking with better results. “The planning activities that occur early in the project are important in determining the path of evolution” (Puddicombe, 2006). The Rural Payments Agency should also have increased the interactions between the different levels of management of the company. The increase in the interactions would have led to the management and the technical issues being discussed within the management. A two way communication would have taken place that would have encouraged feedback from the field based operations management pertaining to the issues that they were facings. Aside from this the possible solutions to the arising challenges and problems could also have been generated in-house though the two way communication between the different levels of the management. “To better inform risk managers, risk assessors must also appreciate and present the broader context of the decision, and they must convey how uncertainties and weaknesses in the assessment may influence stakeholder perceptions of risk and the effectiveness of different risk management options” (Thompson & Bloom, 2000) Improvements could also have been made to the approach taken towards program management by applying the Gateways reviews properly to reflect the wider messages contained in the body of the report.

Challenges and Negotiation

The challenges that were faced by the Rural Payments Agency pertained to the changes in the requirements of the program and the CAP reforms. The constant changes in the requirements led to the scope of the project increasing incrementally. As a result it became necessary to re-design the IT infrastructure to meet the changing requirements that led to increased risks with the changes in the operations. The operational changes that were made pertained to complying and coping with the increased number of inexperienced claimants, the implementation of new rules, increase in the land registration volumes and the launch of new business processes, claim forms and IT application. The Rural Payments Agency never fully owned the vision and the aims of the project that resulted in a tug of war between keeping the focus on the customer and operating for efficiency. A more centralized operations and management system was required to correct these changes.

The relationships between the departments and the agency were also tests as Defra has different aims and objectives compared to those set down by the Rural Payments Agency. The efficiency targets, EC disallowance and the delivery of SPS on time were some of the issues in which Defra and Rural Payments Agency did not see eye to eye. The SPS system also created problems in the development and the implementation phases as a fixed deadline and timeframe was established for the establishment of the SPS system. As the changes in the business processes ad the system were required during the progress of the SPS system. This led to extensive delays and the end system being too complicated to run and comprehend for the management.

The presentation presents the kind of negotiation principles that could have been applied to pave way for a successful program management at the Rural Payments Agency. The strategies that could have been used by the Rural Payments Agency included properly planning for the project and program management while incorporating the roles and responsibilities of the different functions and the management levels in the program management tasks. The goals, aims and objectives had to be revised and attuned to the requirements at hand and the ling term vision of the company. The aims and objectives that were set needed to be clarified and communicated to all the members of the project management and the associated functions in order to make them start at the same wavelength. The Rural Payments Agency should also have given clear direction to the program management team on the objectives and aims of the project and what tasks need to be undertaken as part of the program development at the Rural Payments Agency. The company should also have engendered trust in the operations and with the associated functions and departments by conducting consistent and transparent activities under the program management t that could be reviewed by the departments for any discrepancy during the development of the program and its implementation. This could have saved valuable time and effort that went into completing the program.

The Rural Payments Agency should also have engaged the stakeholders of the company including the customers, the associated businesses, the management and the employees as well as the owners of the company and the board members before undertaking the project. The reason for this is that the inputs and feedback provided by the stakeholders would have helped the company identify the needs and the requirements of the system and the how the company would better provide its customers with the requires products and services in an efficient and effective manner while still being productives


The Rural Payments Agency worked towards a positive outcome form their project implementation pertaining to creating a better system to provide the farmers with the subsidies on their claims in an effective and efficient manner however as the aims and the objectives of the company were not fully realised and due to lack of proper planning, communication between the different levels of management, no involvement of the stakeholders and detrimental program management activities the company was unable to successfully implement the IT based solution to streamline its operations. The Rural Payments Agency were very ambitious in what they wanted from the implementation of the information technology systems and by investing p=more time in designing the business processes and determining hw the company could make and cope with the required changes, the Rural Payments Agency could have made the implementation of the IT system work for the company while also addressing the demands and the requirements of its customers.


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