Worcestershire County Council was handed the inspectorate's lowest rating in January due to "widespread and serious" failures in its support of vulnerable children, including those in care.
A direction notice appointing Cornwall Council's director of children's services Trevor Doughty as commissioner for children's services in Worcestershire was issued two months later.
But following a critical report from Doughty about the council's ability to turn around the service, the DfE has said Worcestershire must now explore alternative delivery models.
Doughty has been re-appointed as commissioner to work with the council to look at a range of options and put forward a recommendation by the end of December. He and the council are also asked to present a full business case for a new model by March 2018.
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