The measure of an organisation’s capability and potential to apply appropriate skills and resources to accomplish its goals, satisfy its stakeholders’ expectations and deliver the demands of a contract or service.

Civil Society

Includes the full range of non-public, non-private organisations which are non-governmental and 'value-driven'; that is, motivated by the desire to further social, environmental or cultural objectives rather than to make a profit.

Clinical Commissioning Groups

(CCGs) are groups of Groups of General Practices that work together to plan and design local health services for an agreed geographical patient population. This is done by 'commissioning' or buying health and care services.


Those in public bodies responsible for commissioning.

Although we refer to ‘commissioners’ in this guide, the guidance is appropriate for anyone involved in assessing needs, designing services, sourcing providers, monitoring and evaluation. It is applicable to those involved in policy, service delivery, procurement and legal functions.


Commissioning is about deciding how best to use the total resources available to improve outcomes. Those resources could be within one organisation or across the public, voluntary and private sectors.

Commissioning is often confused with procurement but they are not the same. A commissioning exercise might sometimes result in a service being procured, but by no means always.


A mutual legally binding agreement specifying the services to be provided and the payment made for providing them.It is the formalisation of an agreement into Law between one or more competent parties.


The process of negotiating and agreeing the terms of a contract for services, and on-going management of the contract including payment and monitoring.


An association or combination of organisations, who come together to with the purpose of providing a service or services in one locality or across a wider area.


A relationship where professionals and citizens share power to design, plan and deliver support together, recognising that both partners have vital contributions to make in order to improve quality of life for people and communities. We believe that co-production is the most effective method of achieving outcomes with people.

Cost-Benefit Analysis

(CBA) is an analytical tool for assessing and the pros and cons of moving forward with a business proposal. A formal CBA tallies all of the planned project costs, quantifies each of the tangible benefits and calculates key financial performance metrics such as return on investment, net present value, internal rate of return and payback period. The costs associated with taking action are then subtracted from the benefits that would be gained. As a general rule, the costs should be less than 50 percent of the benefits and the payback period shouldn't exceed 12 months.


Department for Communities and Local Government.


Applying commissioning principles to cut back or cease services which are no longer necessary or affordable.


Conducting procurement via electronic means, that is, internet, intranet, or electronic data interchange (EDI).

Full cost recovery - (FCR)

Is the principle that when an organisation provides a service for a public body it should be able to recover all the costs of delivering that service. This includes not just the direct costs of the service but also the relevant proportion of all overhead costs. These overhead costs may include: premises and related costs; central functions, such as human resources; governance and strategic development; provision for inflation and depreciation; and regulatory costs.

Gap analysis

The use of research data to understanding citizens, their underlying needs, how far they are from being met by current provision and the assets available to meet them in the future.


A non-repayable sum of money given to an organisation. May be given by a public body to fund a specific project or service which the organisation will be required to monitor and report on.

Health and Wellbeing Board - (HWB)

A statutory committee of a council that leads and advises on work to improve health and reduce health inequalities among the local population. It has a performance monitoring role in relation to NHS CCGs, public health and social care.

Intellectual property – (IP)

Protects ideas and information that have commercial value. IP rights give creators certain exclusive rights over the knowledge and information they create (e.g. the text of a book) to prevent others using it without permission.


Indicators are ways of knowing that an outcome has been achieved, or show progress against an outcome. For example, indicators for an increase in confidence might include a young person trying new things, making new friends, or taking on new challenges. All of these are related behaviours that indicate an increase in confidence.

Joint commissioning

The process in which two or more organisations act together to coordinate the commissioning of services, taking joint responsibility for the translation of strategy into action.

Joint purchasing

Two or more agencies coordinating the actual buying of services, generally within the context of joint commissioning.

Joint Strategic Needs Assessment (JSNA)

The process and document(s) through which local authorities, the NHS, service-users and the community and voluntary sector research and agree a comprehensive local picture of health and wellbeing needs. The development of JSNAs is the responsibility of CCGs and councils through HWBs.

CCGs and local authorities, including Directors of Public Health, will each have an equal and explicit obligation to prepare the Joint Strategic Needs Assessment (JSNA), and to do so through the arrangements made by the Health and Wellbeing Board. It is expected that the Health and Wellbeing boards will develop joint health and wellbeing strategies, based on the assessment of need outlined in their JSNA. The JSNA can be described as an umbrella under which there a number of supporting needs assessments which help to shape the key priorities and recommendations.

Joint Health and Wellbeing strategy (JHWS)

HWBs are required to produce a JHWS for the local area, based on the needs identified by the JSNA.

Lead commissioning/commissioner

One agency taking on the functions of commissioning which have been delegated to them by partner commissioning agencies under written agreement. Partners must decide what functions will be delegated to the lead commissioner and what money to pool to finance the services commissioned.


Local Government Association, across-party organisation that works on behalf of councils to ensure local government has a strong, credible voice with national government.

Options based appraisal system

Options appraisal enables commissioners to evaluate objectively and systematically the best way to achieve desired outcomes. This is achieved by exploring the relative costs and benefits of a particular option and then comparing this fairly to how other options perform against the same set of evaluation criteria.


An outcome is the meaningful and valued impact or change that occurs as a result of a particular activity or set of activities. Outcomes may be achieved over a relatively short period of time, or they may be longer-term in nature.

Outcomes Framework

A framework that sets out the outcomes and corresponding indicators against which achievements can be measured. There are currently a number of national outcomes frameworks including those for the NHS, for adult social care and for public health. Kent County Council also has an Outcomes Framework.

Outcomes-focused approach

An approach based on focusing on the results or outcomes rather than the way activity is delivered by a service (the outputs).


A quantitative summary of an activity. For example, the number of youth work sessions delivered or the number of elderly people attending a luncheon club are outputs. An output tells you an activity has taken place, but it does not tell you what changes as a result.

Payment by Results

The practice of paying providers for delivering services after agreed results have been achieved. Compact Voice’s blog ‘Getting to grips with Payment by Results’

Performance Monitoring

The ongoing collection of information about the service delivery to ensure it is meeting the conditions of the contract. Such information may be needed for three purposes: effective management of the programme; wider accountability for the programme; and policy development.


(Pre-Qualification Questionnaire) used to identify if potential suppliers are capable of performing a contract.


The legal and technical process of seeking bids and acquiring goods or services from an external source, such as a community organisation, charity, social enterprise or business. It is one part of the commissioning cycle, when a good or service is put out to tender, contracts are drawn up and the good or service is purchased.


Any person, group of people or organisation supplying goods or services. Providers may be in the statutory or non-statutory sectors.

Service Leaders

An umbrella term often used to describe heads of service within local government such as Children’s Services or Arts and Culture Services.

Service Providers

An umbrella term used to describe those working to deliver a specific public service within local government.

Social Value

The Public Services (Social Value) Act 2012 requires commissioning authorities to demonstrate how the service to be procured will “improve the social, environmental and economic well-being of the relevant area”.Social Value is also a wider term for value beyond the financial.

Strategic commissioning

The activity of identifying need, allocating resources and sometimes procuring a provider to best meet that need, within available means.

Value for money

Defined as the optimum combination of whole-of-life costs and quality of the good or service to meet the user’s requirement. Value for money is not the choice of goods or services based on the lowest cost bid. Wider social and environmental costs and benefits also need to be brought into any assessment. They will often be more difficult to assess but are often more important and should not be ignored simply because they cannot easily be costed.(HM Treasury)


Used by the World Health Organisation (1946) in its definition of health as “a state of complete physical, mental and social wellbeing and not merely the absence of disease or infirmity”. More recently the concept was described as “feeling good and functioning well” (New Economics Foundation).