Monday, 19 December 2011

Tales of NHS Waste

I'd be more sympathetic to 'Save the NHS' calls if I knew exactly what we were trying to save. A couple of recent experiences highlight the problem.

First, we had an occupational therapist (OT) and physiotherapist arrive together to visit my elderly mother-in-law. Good coordination you might think, but no. These were two therapists from two different teams, and only by a miracle of coincidence had they arranged their visits for exactly the same time on the same day! The two didn't even know each other. We expected the OT, but knew nothing about the physio and have yet to figure out how he was referred to mum-in-law. Not surprisingly, his visit was of little value.

Then my (even older) father told me that for many weeks an ambulance has been calling to provide him with clinic transport on days when he has no clinic appointment! Every week he tells them he doesn't have an appointment on that day, but the following week they're back again. The clinic isn't contactable by phone, he has tried his GP without success, so in desperation he has made a formal complaint in an attempt to stop these wasted calls. He has yet to receive an acknowledgement.

Both instances show a lack of coordination. Different NHS services or teams, even when their work is closely related, do not know what others are doing and cannot seem to communicate. Such confusion and waste would be infuriating at the best of times, but with the NHS experiencing a funding crisis it makes one despair.

It's tempting to say that better IT systems could solve this – a single patient record system of the type that is just about to be abandoned (at a cost of billions to the taxpayer). But I'm not convinced. Focusing services around the patient rather than around the NHS itself is as much to do with attitudes as with IT. I realise that a lot has been done on NHS modernisation in this area, but it's clearly patchy when failures of this kind leap out and slap you in the face.

I remain impressed with the dedication and professionalism of the vast majority of NHS people I meet. But in too many cases their focus is on the service they deliver, rather than starting with the overall needs of patients. Until this changes, I remain doubtful whether the NHS – in its present form – is something worth saving.

 

Check my web site at www.real-improvement.com for more information and ideas.

Thursday, 1 December 2011

Public Pensions - Told You So!

So the November 30th strike has come and gone. Pre-empted, some will say, by the Chancellor's Autumn Statement the previous day announcing a 1% cap on public sector pay rises (private sector pay rises currently average 2.5%).

My last blog stressed the need to look at the whole picture of public sector employment, not pensions in isolation, and criticised government's neglect of basic good management principles. As if to prove my point they further constrain pay - but only for the public sector!

I'm not disputing the need to control public spending, but why not cap pay rises for all employees - public, private and third sector? This could achieve two extra benefits:

  • Support Cameron's claim that "we're all in this together"



  • Stimulate private sector growth by helping to control business costs


It's been done before of course - remember the incomes policies of the 60s and 70s when inflation was the enemy?

Same idea, just a different target. And it might just reduce the sense of injustice that fuels public sector anger.

 

Check my web site at www.real-improvement.com for more information and ideas.

Wednesday, 9 November 2011

The Perils of Public Pensions

With controversy over the Government's latest offer and a national day of action looming, maybe it's time for a fresh angle on the public sector pensions debate.

Words like 'unsustainable' and 'untenable' are just semantics. Basically the Government does not wish to spend an ever-increasing amount of public money on public sector pensions, because it judges it to be unfair both within the scheme and to those outside it. The unions argue that the unfairness is to those who have planned their retirement on the basis of a scheme that is now being radically altered.

Whether the public sector offers more secure employment than the private sector is questionable nowadays, but it has generally offered more security in terms of pension arrangements. But that is simply one of the factors people consider when pursuing a career: the public sector tends to be low risk and low reward, the private sector is higher risk and potentially much higher reward.

David Cameron has done himself no favours with phrases like "we're all in this together". This simply antagonises people who feel that those whose actions led to the debt crisis (certainly not public servants) should bear a greater share of the consequences. Whether or not you believe that economic growth will eventually cascade down to all, the steadily increasing gap between the highest earners and the lowest also fails to placate the many public servants on the wrong end of that equation.

On the other hand the unions must recognise the need for change. The world is changing fast, and longer life with longer retirement (at least in the developed world) is an inescapable part of this. Any suggestion that public pensions should remain forever immune from such change simply undermines the credibility of those who argue for it. I would have much more sympathy if public service unions put forward constructive counterproposals to the Government's case, rather than just arguing against it.

But I believe both sides are missing the point by talking public pensions in isolation. It should be – must be – part of a broader picture that aims to compare public employment with private employment as a whole, and give a fair deal for all. I can remember when this was the premise behind a civil service pay agreement that linked civil servants' pay to that of comparable private sector jobs, taking account of employment terms on both sides (pay levels, security, pensions, other benefits). It was only ever fully implemented once before the Government decided it didn't like figures and withdrew.

Which highlights a general issue around working in the public sector. Whilst ministers often praise the dedication of public servants, this comes across as mere lip service. In reality they rely increasingly on public servants' own conscience and vocation for the loyalty they need. Technically many civil servants are not even protected by employment laws that other workers take for granted (because the Crown cannot prosecute itself). In practice the Government still chooses to abide by the legislation it passes for others; it used also to try to set an example as a good employer but those days are long gone.

So my main criticism of Government is not about pensions as such, it's about lack of respect. It's about an attitude that seems to regard the public sector as a commodity to be juggled within the national economy and undermined when needed to influence public opinion. First principles in any management primer these days will tell you that in order to optimise performance, leaders need to inspire, engage and motivate their workforce. This, as an employer, the Government has spectacularly failed to do.

Check my web site at www.real-improvement.com for more information and ideas.

Wednesday, 26 October 2011

Measuring Real Education

A couple of weeks ago I was at an 'innovation lab' in Leeds on disrupting poverty. The theme was how to break the cycle of poverty and give kids from all backgrounds a fair chance in life. How to overcome multi-generation worklessness and the culture of despair which leads to crime, addiction, dysfunctional families and yes, even riots.

It's not all about money of course. Even if money was available (which it isn't), throwing it at the problem would make little difference. Kids need real opportunities, together with personal qualities such as resilience, self-belief and positivity. Here, we can learn a lot from those who have succeeded in breaking the cycle, who have overcome multiple disadvantages to succeed in life.

I believe, passionately, that every child possesses the ability to excel at something. It's a belief that comes from personal knowledge of children who were academically very poor but who suddenly flourished when they discovered a rare hidden gift (drums, electronics, singing, particular sports – examples are many and varied). The key is finding that unique potential in every child. This is partly about giving them the opportunity to try as many different skills or activities as possible, and partly about the mindset that all of us need to make this happen.

Part of the conversation at disrupting poverty got round to education, and this is where performance measurement comes it. At present, our education system is measured almost entirely on academic attainment: how many GCSEs, A-levels or other qualifications young people achieve.

But we are saying that young people need more than this; they also need the other personal qualities and opportunities highlighted above. How likely are they to get all this when exam results are virtually all that matters to our schools?

I speak from my own experience, because despite achieving (many years ago) 10 O-levels and 5 A-levels I view myself as a educational failure. Why? Because I went on to university without any real idea why I was there, and dropped out after just over a year. I got by OK, but was only some 20 years later - largely by chance - but I discovered my real vocation.

We can only change this by changing how we assess the effectiveness of education. I'm not suggesting that exams are irrelevant, simply that they are only part of the picture. We also need to measure how 'life-ready' young people are when they leave education, and the extent to which the system helps everyone to fulfil their potential.

How we do this is not easy and I don't profess to have all the answers. But here's just one idea: suppose that the assessment of secondary schools' performance included the proportion of their students who are NEET (Not in Education Employment or Training), say, six months after leaving school. I recognise that many schools make efforts to reduce this already but a performance indicator of this type, alongside exam results, would surely broaden the focus of education and get everyone looking for that magic spark that exists in all youngsters.

A lot of change is needed to achieve this, but it starts by all of us understanding the problem. We need to demand that education is more than just an exam-passing system, but contributes to releasing the full potential of every young person.

 

Check my web site at www.real-improvement.com for more information and ideas.

Wednesday, 12 October 2011

The Cost of Wellbeing?

I'm interested by a recent report from Family Investments [here] that tells me that the best place in England to bring up children is the village of Winkleigh in Devon. Interested not because of the prospect of a mass-migration to Devon, but because it's a classic example of really bad research.

The report uses a points-scoring system to evaluate a range of 'wellbeing' factors, including education, crime, property prices, birth rate (so the kids will have friends) and amenities. The principle here is sound enough: develop a common currency to compare very different attributes, some of which may be intangible. Social Return on Investment (SROI) does this by using financial proxies to assess how much a particular service or course of action might be worth to its stakeholders. But the currency doesn't have to be money; it could be points, smiley faces or whatever you choose to make it provided you can say what the 'exchange rate' is.

Problems start with getting the factors and this exchange rate right. What would be the trade-off rate between better local amenities and a higher crime rate for example? How much weight should we give to clean air and a healthy environment compared with higher property prices?

In practice, people make their own decisions on this often enough. Should we move to a more expensive area to get our children into a better school? Should we pay for private healthcare rather than wait for the NHS? Yes, we can put a value on these questions, (and many studies have done) by taking a national average. But in practice these decisions are personal ones, because we're all individuals not a collection of averages.

So it's nice to learn that salaries in Winkleigh are some 50% above the national average - but only if you're earning one of those salaries, not if you're contemplating moving without a job! And if your favourite leisure location happens to be the Lake District then you'd be a long way away.

So whilst this report may be curious reading, it's spurious research; basically just a PR exercise. For any wellbeing research to be meaningful it has to have a particular purpose or client group in mind. Either:

(a) policy-making at local or national level, where some kind of average might be relevant, or

(b) an individual or specific group who could benefit from a particular initiative or changed situation

Good evaluation, particularly where it touches on intangibles such as wellbeing, must have a clear purpose and identify practical benefits that a target audience can do something about. The Family Investment report fails this basic test.

Check my web site at www.real-improvement.com for more information and ideas.

Wednesday, 28 September 2011

Localism: I told you so!

Way back in February, this blog anticipated a hidden agenda behind localism - that it would only apply where 'locals' did broadly what the Government expected. And lo, it came to pass. The CLG Select Committee report on localism raises many concerns including: "The litmus test of localism will be the Government's reaction to local decisions with which it disagrees."

The report also makes other sharp observations, particularly in highlighting the need for culture change and stating that both ministers and civil servants need to curb their "appetite for intervention". Localism will succeed or fail not on the mechanics of legislation, but on how people behave and respond to this new balance of power.

At the moment I'm pessimistic, not least because of the nature of the Government's response to the Select Committee's recommendations [here]. The Committee's pointed concerns are replied to with bland political rhetoric and broad statements of intent. Very few specifics; certainly no mention for example of the weekly bin collection fiasco of a few months back (if Local Authorities can't decide this, what can they decide?). Still less on how the Government will respond to the next major (local) social care incident.

It's not just the nature of the Government's response; its tone and phrasing also weakens its credibility. One of localism's stated goals is to increase local democracy and strengthen public engagement with the democratic system. How can it achieve this if challenging questions are answered with the same old bland, evasive claptrap that has undermined people's faith in politicians for decades?

If the Government is really serious about devolving power to local levels, it has to do a lot better than this.

Check my web site at www.real-improvement.com for more information and ideas.

Friday, 2 September 2011

Wheel-Reinvention in the NHS

I read, with some incredulity, a report by Ashton Business School on NHS Staff Management and Health Service Quality (here). I quote: "By giving staff clear direction, good support and treating them fairly and supportively, leaders create cultures of engagement, where dedicated NHS staff can in turn give of their best in caring for patients".

Wow! Really?? You mean that basic good practice management, recognised internationally for over 50 years, applies to the NHS as well? My amazement is of course around the fact that this sort of thing gets published. Clear direction, staff engagement and support are fundamental tenets of the EFQM Excellence Model, Balanced Scorecard, Investors in People, Customer Service Excellence, and just about any other management model you can think of. Do we really need to re-invent this wheel purely for the NHS?

More valuable would be research on why such common sense and common knowledge is still not common practice in many organisations – NHS and elsewhere. In fact the report may contain a couple of clues here.

Firstly (to its credit) the report contains statistical evidence showing that theory does indeed work in practice. There is a positive correlation between staff engagement and results achieved, including higher patient satisfaction and lower mortality. However, I can't help wondering whether leaders who need such evidence to convince them of the intuitively obvious will possess the people management skills to put it into practice.

Secondly, there may be those who believe the NHS needs separate management research "because we're different". Yes, the NHS is different, unique even. But then so is every other public, private and third sector organisations in the world. One thing it has in common though is that it is staffed by human beings, who generally respond well to good management. The way it is done may certainly vary; there isn't a 'one size fits all' management technique. But the principles of good management are universal.

If NHS leaders need their own proof, then the report may not convince them anyway. Because any detractors will simply claim that it hasn't been proved for their particular team in their particular department in their particular part of the NHS. "Because we're different".

Let me add one more good practice management principle. Great organisations and great leaders look beyond their own environment, learn from others in very different service and industry sectors, understand what works and apply it in practical ways that suit their own situation. They don't need to re-invent the wheel, but they can fit it and make it run.

Check my web site at www.real-improvement.com for more information and ideas.

Wednesday, 17 August 2011

If EFQM is the Answer, What's the Question?

This short blog is inspired (?) by a client request for a paper on the benefits of using the EFQM Excellence Model. It's a request I've heard many times over the years, usually to influence senior managers, and one that worries me because it may not be the right question.

For comparison, would you go to your GP and ask him/her to sell you the benefits of the latest patent medicine? The EFQM model is a tool, a very flexible and powerful one, but it isn't a universal panacea and will only help when the organisation knows what it wants to achieve by using it. In a commercial context this may be fairly straightforward (the bottom line), whilst public or third sector organisations often find it more difficult to be clear about how they balance stakeholder priorities.

But this context is important, otherwise "the answer is 42". Sadly, I've seen many organisations dive into EFQM self-assessment with vague aspirations and unclear objectives, only to be disappointed when the Model fails to deliver a miracle.

The question I would like to hear is something like "in order to achieve X we need to improve Y. How can the EFQM Excellence Model help us to do this?" This should lead to a sensible conversation that can be summarised by reference to the RADAR® concept linked to the Model itself:

Approached in this way, the Model can be properly integrated with strategic planning rather than falling into the trap of being seen as 'another thing to do'.

Check my web site at www.real-improvement.com for more information and ideas.

Wednesday, 13 July 2011

Opaque Public Services?

The Open Public Services white paper, published this week, demands a response.

I'll pass on the obvious stuff, such as the unfortunate timing in a week when Southern Cross and News International demonstrate the risks of private sector control, and also the argument that the White Paper is long on aspirations but much shorter on practical implementation. I'll even hold fire on the point that those with personal budgets are being advised by precisely the organisations who stand to lose when their services are opened up - though this is certainly an issue.

Some of the claimed links with other government initiatives are also very tenuous. It suggests for example that higher university fees are all about increased student choice (silly me for not realising this). But this too we will let pass for now.

No, what really disappoints me is that a White Paper all about change and innovation is written in such a traditional and uninspiring way. It's all as top-down as ever:

  • government sets the agenda and defines the types of services to be opened up

  • government decides the parameters and establishes commissioning arrangements

  • government oversees the regulatory regime

  • government anticipates the difficulties and decides how support should be funded


and so on.

Here are just three alternative suggestions to the government if they are genuinely committed to opening up public services:

1. Have someone other than a civil servant write the White Paper. It's all about open public services, so why not start here?

2. Write it from the perspective of those you are trying to engage. For example, instead of chapters on individual services, neighbourhood services and commissioned services, the headings should be:

  • opportunities for SMEs

  • opportunities for voluntary organisations

  • opportunities for individuals and sole traders

  • opportunities for social enterprises

  • opportunities for people already working in the public sector to take over the services they run


3. Finally, present a realistic 'force-field' type analysis that properly explores the obstacles to progress and how these can be overcome, rather than the superficial and vaguely hopeful coverage the White Paper currently gives these. Hearts, minds and attitudes need to change, and this certainly won't be achieved by stipulating a 25% target for government contracts to SMEs, still less by having senior politicians presenting awards for innovation.

As Juran (I think) said, "if you always do what you've always done, then you'll always get what you've always had". Without some much more radical thinking and true innovation, the government's Open Public Services agenda is going nowhere.

 

Check my web site at www.real-improvement.com for more information and ideas.

Tuesday, 28 June 2011

A Last Load of Rubbish

Waste and Wasted Opportunity

It's mostly all been said in the bins debate. Is it more about grabbing headlines than addressing issues that matter? If Local Authorities aren't even allowed to decide how often to collect rubbish, is Localism anything more than empty rhetoric? Turns out we can't afford weekly bin collections anyway in a climate of cuts - what a surprise! So I thought it was all over until I read that Eric Pickles is forming a unit in CLG to resurrect the plan.

To me there's also a vital point that's been lost in all this infighting and points-scoring. Weekly bin collections are supposed to be "a good thing", but why? Frequency of bin collection is an output, not an outcome. It might be a means to an end, but it certainly isn't - or shouldn't be - an end in itself.

To understand outcomes, we need to go back to the basic purpose of waste collection. Why do we do it? In my view there are three objectives:

  1. Minimise any risk to public health

  2. Reduce the amount of waste to landfill

  3. Control costs to the taxpayer


These are the real outcomes, benefitting health, the environment and the taxpayer respectively. Only the first might benefit from weekly collections, and even this is tenuous - I've yet to see firm evidence that fortnightly bin collections increase the incidence of disease. I also discount the argument about "rubbish on the streets" because this is about storing waste properly, not about collecting it.

Whilst 1 and 3 above are consistent with existing NHS and local government directives, there is no longer any recycling or waste-to-landfill requirement on local government. NI 191-193 disappeared with the abolition of the National Indicator Set, and although many councils have retained their Local Area Agreement targets, they are not obliged to do so. Surely if central government is directing anything it should be directing an environmental strategy, and reducing waste to landfill is a fundamental part of this.

Confirm that as the objective and everything else falls into place, because councils will have an incentive to:

  • increase recycling and reuse capabilities in their area

  • promote increased recycling and composting

  • encourage local residents and business to reduce non-recyclable waste

  • find imaginative new ways to reduce landfill, including collaboration with networks such as freecycle and other voluntary groups involved in creative reuse of materials


Some of this requires innovative thinking, but so much the better. Indeed, the whole thrust of targeting reduced landfill should be to encourage positive behaviours, from councils, their residents and businesses.

Many councils already have the right idea, but a combination of cuts and lack of incentive threatens progress in this crucially important area. The message from this voter is: please don't focus on how often our bins are emptied, focus on the future of our communities and our planet.

Check my web site at www.real-improvement.com for more information and ideas.

Friday, 10 June 2011

Of Rats and Men

Performance measurement, behaviour and Big Society

I'm always intrigued by the way performance measurement influences the behaviour of people and organisations. Basically, people respond to what is actually measured, not to the intention behind that measurement, and this is evidenced by many examples of poor performance indicators generating bizarre consequences. The 'rats example' (hence the title - apologies to Burns and Steinbeck) is a particularly pertinent one.

Measuring Performance in the Public Sector (Hans de Bruin) quotes a US pest control company that rewarded its workers based on the number of rats they killed. The result was that the workers made sure there was a continuing and healthy rat population so that they had plenty to “harvest”! Hearing this story, a colleague (I believe it was Mike Chitty) told me of a UK Local Authority that sought to gauge their pest control efforts through the number of reports of rats received from the public (the fewer reports, the fewer rats there must be). They found their staff trying to persuade callers that they had seen large mice rather that rats – because mice didn’t count on the statistics!

Some consultants use this as an argument for abandoning any form of performance measurement. There is even 'Goodhart's Law' (after a former Bank of England advisor) that essentially states: “Anything that we choose to measure becomes unreliable, once we measure it for the purposes of control”.

I'm not a subscriber to this negative view. Instead, I believe we should think about performance measurement in terms of how people will respond to it, and deliberately design measures that influence behaviour in a positive way. So for example rather than waiting time in A&E, we could assess what patients think of their treatment, together with the medical consequences of any delay.

Another example: some service organisations measure the effectiveness of customer communication through the response rate they get to surveys. It doesn't apply everywhere, but in some situations it actually encourages desired behaviours amongst the organisation's staff – accessibility, customer focus, and above all responding to customers' views rather than just going through the motions of consultation.

Even the rat dilemma can be answered by understanding why we want to control the rat population. If community health is the reason, then a sensible measure might be the incidence of rat-associated diseases. If it’s simply that people don’t like having vermin around, then the number of reports could be a perfectly valid measure, and it doesn’t actually matter what species the callers have seen.

This has significant implications for Big Society. Measures such as number of volunteers or time spent volunteering are of limited use because they simply measure outputs; they don't address outcomes or what actually changes. The problem then becomes one of clarifying exactly what change is intended, because despite David Cameron promoting its principles, few people really grasp what Big Society should look or feel like.

I don't claim to have all the answers here, but just a suggestion: how about linking some element of local authority funding to the number of taxpayers in the area who are employed by third sector organisations? This might encourage local authorities to promote the growth of the sector in a much more positive way than they currently do, and hence create communities in which the third sector plays a much larger role. If that is what we want, that is.

There's another rat connection. Like it or not, we are all a bit like laboratory animals on which the latest government social initiatives are being tested. Let's hope we can respond more intelligently than the rodents.

Check my web site at www.real-improvement.com for more information and ideas.

Thursday, 5 May 2011

Selling England by the Pound

You may know it as the title of a 1973 album by Genesis. It's also a potentially bizarre solution to the country's debt crisis, but one with a serious point. The premise is simple: instead of such massive cuts in public expenditure, why don't we sell off more assets?

Private companies facing debts would consider just such an option, and some companies make their living by buying and asset-stripping others. Of course this only works if you can continue to balance the books afterwards, but that's a great deal easier if you're not having to pay huge amounts in debt interest.

What assets? Well, have you ever thought what the entire country might be worth in cash terms? Don't get this confused with GDP, which basically represents the value produced by the country as a whole in one year. This is a bit like turnover on a balance sheet, where national debt would appear under liabilities. But surely such a balance sheet should show assets as well?

There's the land for a start: the Barclay twins paid £2.3m for the Channel Island of Brecqhou in 1993 - less than 1/3 of a square mile, so extrapolate that for the whole of the UK at 2011 prices. And the value of buildings and other constructions: the old London Bridge went for $2.46m way back in 1968, so what might all our public buildings now be worth? And works or art, public institutions, transport infrastructure? I can't begin to estimate the value of the whole UK on this basis, except to say that it must run into thousands of trillions of pounds.

Against these kind of figures, the UK's GDP of around £1.5 trillion (£1,500bn) and government debt of £1.1 trillion pale into insignificance. Of course, most of the nation's assets are in private hands, hence not available for government sell-off. But just the value of publicly-owned assets must run into many trillions.

The government has indeed done some modest selling, mainly through privatisation. But it recently reversed its plan to sell 258,00 hectares of state-owned woodland, and even moving organisations has met strong resistance ("wholesale outsourcing" of public services to the private sector would be politically "unpalatable", the BBC reported recently). Meanwhile hedge fund manager Jonathan Ruffer has donated £15 million to save three paintings "for the nation" - so the national asset base continues to grow.

In practice, the notion of solving the national debt by selling off, say, the Isle of Wight is preposterous and would never happen. But it's worth reflecting on why this is so. The answer has to be that we value national assets way beyond their material cost when considering what they mean to us. These intangible considerations could include the environment, well-being, leisure opportunities, even heritage or national pride, as well as  individual happiness.

Winston Churchill once responded to a suggestion that arts funding should be cut to support the war effort by saying "Then what are we fight for?" Sad that we are now cutting arts funding in peacetime, but someone has decided that it's less painful to cut ongoing funding than it is to sell off national assets (artistic or otherwise). What troubles me is that this may not be a conscious policy decision; who has decided that a precious painting adds more to our national life than subsidising theatre companies for example?

Like it or not, we could if we had to convert all of the intangibles that create value in our lives to a monetary equivalent. SROI (Social Return on Investment) does in the relatively limited field of social impact, and the principle could be extended as widely as we choose. As an extreme example, if it came down to a choice between the complete abolition of the NHS and the sale of Lindisfarne (Holy Island), then for me Lindisfarne would have to go.

For the moment at least Lindisfarne and the Isle of Wight are quite safe; that's not the point. The point is that we should start understanding value - including assets as well as services - as a common currency that embraces all aspects of our lives. If you're not happy with the financial proxy, then call it 'happiness points' or 'valunits' or whatever. Intangible it may be, unmeasurable it should not be, because we can only make effective policy decisions if we understand - and can measure in some way - what it is we are trying to improve.

Check my web site at www.real-improvement.com for more information and ideas.

Thursday, 14 April 2011

Would You Strike if You were Paid $1m a Year?

No, for a change we're not talking about city bankers (although I'm sure some of us would like them to go on strike!). If you're American, it's far more serious than any international financial crisis. It's the prospect that professional American Football players could go on strike and curtail or even wipe out the 2011-12 season.

Let's get things clear: we're talking big money here. The NFL (National Football League) generates around $9 billion each year and at present just over half of that goes back to the players through salaries and other payments. The rest is kept (or invested) by the owners of the 32 teams. This means that the minimum annual salary a professional player will earn is $320,000, with the biggest stars earning well in excess of $10m a year. The median figure is $800,000, and with bonuses and endorsements almost half of all NFL players can make $1m per year.

The issue is basically that the owners want more money, and have offered to increase the 'pot' by extending the season from 16 to 18 games. The players want to retain the status quo (more games would risk more injuries) and are prepared to strike to achieve this. Although the season doesn't start until September, negotiations are already deadlocked; the two sides are not even talking at the moment and their only contact is through a series of acrimonious lawsuits. A delayed start to the season, or even its total cancellation, seems very possible.

To be fair to the players, their average professional career lasts only 3½ years, and their terms of employment would be illegal in any other occupation. For example, even city bankers can decide which company to work for. Not so professional American Football players, who (thanks to special exemption from relevant legislation) can only move between teams in very limited circumstances, often not of their choosing. They are also paid per game, so going on strike would lose them, at 'minimum salary' $20,000 per week. The league's biggest earner, Peyton Manning, would lose almost $1m per week.

All this puts a new perspective on current debates about the level of UK public sector pay and how well we reward chief executives. I believe it also tells us something about our wider working lives.

To start with, it seems to prove there's more to life than money. Even three years at an average NFL salary is more than most of us will earn in a lifetime. Call it status or pride if you like, or maybe basic human rights if you're on the players' side, but it seems clear that people are not prepared to be wage slaves no matter how large the wage in question.

This finds an echo in our own society. At an personal level we look for motivation, respect and fulfilment from our work as well as a living wage. Nationally too, the message seems to be gradually getting through that there is more to life than GDP. Less tangible aspects such as well-being, community and environment matter as well.

It also carries lessons about working with people in any situation of collaboration, not just employment. Reaching agreement, reaching a situation where two groups whose interests do not coincide can work together effectively, needs a mindset that respects the other party's view and understands why they act as they do. Not exactly "know your enemy", but it is about stepping outside your own perspective and seeing the world from someone else's.

Perhaps it's something uniquely American, but with the NFL these wider aspects of understanding seem to have got lost in a headlong rush for money. Let's hope the rest of us are not so blind.

Check my web site at www.real-improvement.com for more information and ideas.

Thursday, 31 March 2011

To March or Not to March?

Reflections on the 26 March Protest - and the Future

The London demonstration showed, if nothing else, people's strength of feeling against radical cuts in public spending. But, like many others, I would be more comfortable if I was clear what they were marching for, rather than against. I’m opposed to the current level of spending cuts, but equally opposed to continuing to fund poor public services. So where does that leave us?

Few people argue about the need for deficit reduction. It’s the extent and pace of the consequent cuts that causes controversy, and I’m convinced that no-one has the ‘right’ answer on this. We are speculating about how those nebulous concepts ‘the economy’ and ‘the markets’ will react to different policies, and if economists cannot predict this what chance do mere politicians have? So the view that any cuts should be slower, less deep and less arbitrary is certainly a legitimate one, and one that people have every right to express (short of the violence that marred the end of the day, which I utterly condemn).

The problem is that I’m not convinced that ‘slower and less deep’ is a sufficiently concrete alternative. Because if it is why haven’t we been doing it for years? Of course in many areas we have, and public service organisations across the board have been engaged on service improvement and efficiency initiatives – many of them very successful – going back some time. But their impact has been limited, and most of us will have personal experience of public services (sometimes those we work in!) which remain bureaucratic, inefficient and inept.

There’s a strong argument that the current cuts are less about fiscal policy than about driving organisational change. Successive governments have tried for decades to ‘simulate’ private sector market forces in an attempt to address the perceived inadequacies of public sector performance. And I stress the word ‘perceived’ here, because public service organisations are an easy target for accusations of mis-spending "our" money. (Funny, I thought it was our money that funded Tesco as well, but perhaps not?). So, the theory goes, impose huge cuts in public spending and organisations will be forced to change, where in the past they might have dragged their feet.

Whether or not that argument is justified, the counter-argument can't be one of status quo or “please leave us alone”. Public services have to demonstrate that they can and will improve the value they deliver without being beaten over the head with the blunt instrument of spending cuts. In doing this they are at an innate disadvantage compared with the private sector, who can generally express value in terms of revenue and profit.

The public and voluntary sectors often deliver value in much more intangible ways, through the difference they make to people and communities, and these can be much harder to communicate. Which is why public services are such an easy target: the money they cost is often much more visible than the results they achieve.

In a sense, cutting services (or maximising fees for Universities) in response to funding reductions is admitting defeat. It implies that your organisation knows so little about how it works that you cannot even identify opportunities for improving value, let alone implement them. Some more positive response is needed, over and above what may have been said or done before.

Whilst heavy-handed inspection regimes may be a thing of the past, accountability certainly is not. What we need is a situation where public services are recognised, by government and the public at large, for the real value they deliver. To achieve this, public services themselves must:

  • find meaningful (and non-bureaucratic) ways to demonstrate the difference they make; and

  • prove that they can achieve radical improvements in performance without the external 'sledgehammer' of public spending cuts


Get that right and I’ll be marching with you!

 

Check my web site at www.real-improvement.com for more information and ideas.

Wednesday, 16 March 2011

Measuring the Unmeasurable (Part 2)

We continue our debunking of Einstein's statement "Not everything that matters can be counted." Happiness-counters ('well-being' if you prefer) please take note!

The factors that contribute to human happiness are largely understood. More than 50 years ago Abraham Maslow published his 'Hierarchy of Needs' which classified the building blocks of well-being very succinctly – see illustration. (Looking at this from the relative comfort of the UK it is disturbing to see how many parts of our world struggle with the very basic needs of this pyramid's first two levels, whereas we agonise over relatively trivial matters towards the top.)



In measuring these factors, it is important to do so from the perspective of customers or stakeholders – those on the receiving end. For example, the value of an initiative to reduce youth unemployment does not lie in the amount of money invested but in the benefits and perceived increase in well-being from those it affects (trainees themselves, their families and their communities). Some of these benefits may be intangible – the 'feelgood factor' if you like – but there are ways to quantify even these benefits. Social Return on Investment (SROI) uses many of these techniques.

From a policy perspective the most testing aspect then becomes understanding how we attain that increase in value. What initiatives or activities will yield the best results in terms of improving these outcomes, and how can we make the best use of available resources to achieve these? Currently, the government's whole Big Society approach is predicated on the idea of maximising well-being at minimum cost by seeding communities to bring about change and improvement for themselves rather than have the authorities do it for them. As a philosophy this is difficult to argue with; it's the means of bringing this about that are much more controversial.

Measuring the effectiveness of this type of 'enabler' activity thus becomes critical in understanding what works and its likely impact on well-being. How will we assess for example the success or otherwise of the government's Community Organisers, for whom a training contract has just been awarded to Locality? It's easier in fact to say how not to do it, and that is by using the first metric that comes into your head. The right approach is to develop a long list of possible indicators ('brainstorming' is a permissible term), and then distilling this down in group discussion to one or two indicators that best reflect what you are trying to achieve.

Working with a housing organisation, I once tackled the question of how they should assess the effectiveness of their communication to and from tenants. We brainstormed a wide range of ideas, and the metric eventually selected actually came up quite late in the discussion. They chose to measure the percentage response rate from annual tenants surveys, partly because a higher response rate should indicate a more engaged tenant community, but also because this indicator should also encourage the right mindset and behaviours amongst their own staff.

Whilst it may be possible to attribute numbers to these intangibles, and hence measure the unmeasurable in this way, the real point is not about numbers but about change. If we have some indication of happiness/well-being levels, and have measures which tell us which of our attempts to influence these are most successful, then there is very little added value in being able to articulate this to several decimal places. It's at this point that we make the essential and very welcome transition from measurement to actually making it happen!

Check my web site at www.real-improvement.com for more information and ideas.

Thursday, 3 March 2011

Measuring the Unmeasurable (Part 1)

Albert Einstein once said: "Not everything that matters can be counted. Not everything that can be counted matters."

Few would argue with the second statement. The raft of recently withdrawn performance targets bears witness to the futility of much of the counting the public sector has undertaken in the past few years. The first part of Einstein's quote might be questioned however, particularly by David Cameron if he wants to measure national happiness.

Part of the problem lies in the nature of measurement. It was Disraeli who allegedly coined the phrase "lies, damned lies, and statistics", though I personally prefer Vic Reeves version: "84.9% of statistics are made up on the spot!" Issues arise not with measurement as such, but when we try to reduce everything to numbers.

In fact there is nothing new to measuring something as intangible as happiness. The former King of Bhutan famously declared in 1972 that "Gross National Happiness is more important than Gross National Product". Since then his country has measured its people's happiness based factors which, whilst founded in Buddhist philosophy, reflect components that are internationally recognised as contributing to human happiness. These components (sustainable development, cultural values, natural environment and good governance) are still easier to state than to measure precisely, but they act as the foundation of the way that particular society operates.

The point is that we should not expect to measure happiness, or other intangible human attributes, to a number of decimal places as we might measure distance, temperature or other characteristics of the world around us. Measuring happiness only becomes useful if we can say whether or not it is improving, and can influence the factors that cause that improvement. The maxim "don't ask a question unless you know what you're going to do with the answer!" applies perfectly here.

Getting meaningful information on human happiness thus comes down to two aspects:

  • understanding the factors that cause people to feel happy or otherwise

  • understanding how we can influence these factors and hence make people happier


The first of these is not hard to appreciate. We cannot for example measure the 'niceness' of the weather as a single figure, but we can measure factors like humidity, temperature, wind speed and sunshine that influence our perception of the weather. The same applies to happiness except that some of the factors here are more subjective, or could be prioritised differently by different cultures.

The second factor - influencing - is harder, because it involves anticipating both the short-term and long-term impact of the decisions we make. For example, we already prohibit access to certain land areas to preserve wildlife and natural habitat. Taking this much further, by excluding people from large areas of our national parks, would undoubtedly yield benefits in terms of sustainability for future generations. But in the short term it would make many people unhappy by denying them access to areas and pursuits that they enjoy. Similarly, alleviating unemployment through costly government subsidies may increase happiness for those who benefit, but could be outweighed if the longer term economic impact of such spending adversely affects the whole population.

Moreover, some of the indicators on which such policy decisions have to be based may themselves be intangible: how can we measure sustainability, motivation, or communication for instance? It's a complex issue but the starting point is something I would like to offer as an alternative quote to the Einstein original:

"Everything can be measured in some way. Nothing (other than simple counting) can be measured with perfect accuracy."

In other words, it's not about trying to reduce everything to numbers but about how we can gauge and influence what will be widely accepted as improvement. Assessing progress rather than trying to measure absolutes, if you like.

This was Part 1. "Stay tuned" as they say, and I will develop this argument in more practical detail with my next blog.

Check my web site at www.real-improvement.com for more information and ideas.

Wednesday, 16 February 2011

The Real Localism Agenda?

A series of unfortunate events? Possibly more revealing than unfortunate, but three things have recently caught my eye re Localism:
1. Nottingham City Council's refusal to comply with the directive to reveal all spending over £500 (apparently it's not mandatory but "measures will be taken" against authorities that do not do so!)
2. The code of practice on local authority publicity published last week, which seeks to restrain local government spending in this area
3. the latest proposal from Eric Pickles that all local authority salaries above £100,000 should be subject to a vote of full Council

None of this seems to me consistent with government's declared intention to "get out of the way" and give local authorities greater freedom address local priorities. The message seems to be that Localism applies provided:
• local authorities pursue broadly the kind of agenda that central government expects them to; and
• they don't do anything silly for which central government could get blamed

The first of these features should come as no surprise. Someone (can't remember who) once said "empowerment means everyone doing what I want to without my having to tell them". And even if Henry Ford never actually said that his customers could have their Model T's "any colour you like as long as it's black", then the point was still made. In this case the message seems to be that councils can have any colour they like as long as it's a shade of blue.

The second feature has always been with us, because the limited powers of local government mean that local elections are treated much more as a barometer of opinion on the present central government than a true expression of local wishes. (I plead guilty to this – my vote in one local election was a protest against the Iraq war, simply because I had no other way of democratically expressing that view.) If you doubt this, find out how many of the electorate do not know the political complexion of their local authority, still less who their local councillors are.

The worry is that this situation will be exacerbated if there is a hidden agenda that advocates Localism whilst at the same time constraining local authorities in an array of new and confusing ways. The single data list, which promises to define everything local authorities must report to central government, is still in draft form and looks ominously complex (see CLG website). Now I appreciate that some of this is inherited, but it still puzzles me to see that 'Fly Tipping' and 'Stray Dogs' must be reported "To protect the national interest, where local accountability is insufficient"!

I will be interested to see whether "Whatever Eric Pickles' latest idea is" makes it as a separate item on later drafts.

So what has this to do with managing performance, supposedly the theme of this blog? It's actually very relevant, because understanding the balance between local priorities and central government requirements has always been a critical part of managing performance in this arena. Many local government balanced scorecards do this explicitly, and have previously captured community priorities in the former category and CAA, NIS and other required indicators in the latter.

There was a lot wrong with the previous targets driven regime: top-down, top-heavy, bureaucratic and in many cases inappropriate. But at least the agenda was clear and the indicators themselves were transparent. The danger now is that we may be moving to a situation not just of moving goalposts, but where the goals themselves are hidden.

And if Localism is just empty rhetoric, what does that mean for Big Society?

 

 

Check my web site at www.real-improvement.com for more information and ideas.

Thursday, 3 February 2011

Why Efficiency Doesn't Work!

Of course, the title is a misnomer in that efficiency can and does work. Or at least, it works in the sense that we can always find better ways of working, means of achieving better outcomes for the same or less resources. Design innovation, lean systems thinking and a host of other methods have been proved to yield significant results in terms of delivering more for less. And few things can be more important in the current economic climate than achieving these kinds of benefits.

All too often however, problems occur when translating ideas from the drawing board (or flip-charts and post-it notes) to the live environment. Redesigns that yield substantial efficiency gains on paper fail to translate into practical savings, and one of the major reasons for this is organisations' budgeting systems. It's a factor that most affects the public sector, because their need for financial control and accountability means that rigorous procedures are in place, and in short 'the accountant is king'.

The following diagram illustrates the problem graphically. Services organisations are traditionally structured on a functional basis, whilst it is well known that customers often cross the whole organisation experiencing each of the functions as they progress.

The lean service approach takes this customer perspective and redesigns the end to end process to minimise duplication waste and overlap. However, without a total restructure of the organisation, those same functional areas are still in place, and budgets remain allocated by these functions rather than by the process as a whole. The budget holders -those with the real power - can be viewed as sitting at the top of those functions and retain control of their part of the process rather contributing to the big picture.

The result is resistance to change, partly because the finance system has no means of attributing end to end cost savings between functionally based budgets, but also because of a natural reluctance by individual budget holders to relinquish any part of their empire - "You can't do that, I'd lose half of my staff". Just to prove that the problem applies to private organisations as well, check out the following cartoon exchange, between Dilbert and his spiky-haired boss.

Sadly some people don't find this funny because it's too close to the truth.

Budgets are the enemy of efficiency because organisations so often budget by function rather than by process. To be fair, some glimmers of hope have appeared in recent years where pooled budgets (for example between health and social care) have given commissioning organisations the opportunity to review service provision on a much wider basis and fund it accordingly. But sadly these examples are all too rare (and might even have to be re-learned when GP commissioning comes in). What we still see, despite everyone saying that the scale of public expenditure cuts demands new and innovative responses, is the same of approach of top-slicing budgets. "Our income has reduced by x%, so we'll take x% off everyone's budget". It's an approach being applied now for the same reasons it always has been - because no one can think of a better way to do it.

Sadly, I'm pessimistic about our prospects of most organisations achieving real change in this area. Their historically-based budgeting systems have become so sophisticated and ingrained over many years that changing them is about as easy as turning round and oil tanker. There is hope though, for those organisations that 'get it' and appreciate that real improvements are not achieved by compiling detailed reports, but by changing the way the organisation thinks. It's only by doing this that they can move to a position where outcomes - not people - own budgets and hence where efficiency really can work.

Check my web site at www.real-improvement.com for more information and ideas.

Wednesday, 26 January 2011

NHS Reforms and 'Excellence in Policy-Making'

A few days after my last blog, government ministers felt the need to give a robust defence of their current plans for reforming the NHS. So I couldn't resist seeing how this contentious and admittedly radical policy matches up against the principles of excellent policy-making that I discussed last time. The question is, leaving aside political philosophy, how well-created is the policy itself?

I'll use the criteria of the DWP Model mentioned last time as a starting point (it's a different Department but the principles should still hold), with my comments against each:
Clear Objectives: OK here. The aim is to ensure that money follows demand hence improving responsiveness, and reduce overall costs in the process. The thinking has to be that reconstructing the system largely from the ground up should produce a much leaner (and hence cheaper) structure than the current one, even if GP consortia become quasi-PCTs with their own accountants and managers.
Outward Looking: Hmmm - unclear. How much stakeholder consultation went in to the development of this policy, and does any other nation have a similar health system?
Good Analysis: I'm sure the calculated savings work out, at least on paper, but less sure about the research that underpins them.
Well-Designed Proposals: A fairly broad criterion, but probably OK here.
Good Plans for Delivery: This is the criterion that comes closest to my point on Empathy - see below.
High-Quality Advice: Despite tight timescales, I'm sure DH can tick the boxes here.
Excellent Communications: They've done their best. It's the message rather than the medium that could be the problem.
Continuous Improvement: Yes in that piloting is going on, even if one suspects that decisions have already been taken.

OK, I'm sure this is unfair in that I've looked at these 'Excellence in Policy-Making' criteria only very briefly and subjectively, but it suggests a reasonable attainment against most of them.

But what about that extra factor of Empathy that I mentioned last time? What about the feelings and reactions of those affected by these proposed changes? Well:

  • GPs generally don't want it. Most GPs entered the profession to work with patients, not because they wanted to manage the NHS.

  • Managers and staff in PCTs and SHAs are largely against it, for obvious reasons.

  • Patients themselves probably don't care. They certainly want excellent service and treatment, but the systems and money that provide these are not 'visible'.

  • The General Public - if they understand it - are probably against anything they see as an attack on the NHS, even if they accept the need to reduce public expenditure.


In summary, a big FAIL here.

So will it work? Can the government drive through a policy that seems unpopular from every perspective? In practice, just because it fails this (modified) 'Policy-Making Excellence' test doesn't mean the government won't try to force it through. But they will need to brave the political unpopularity it will generate, and face the risk that the system will prove unworkable simply because no-one wants it to work.

I'm going to make a prediction: By sometime in 2013, when the current redundancy scheme has already reduced overall staff numbers, we will see the emergence of NHS Reforms Mk.2. These will present a compromise system, somewhere between what we have now and the coalition's current aspirations. Watch this space!

 

Check my web site at www.real-improvement.com for more information and ideas.

Tuesday, 18 January 2011

Can We Evaluate Policy-Making?

This blog is part-inspired by a PMPA* session I attended last week, and partly because the subject has long fascinated me. The question is, can organisations evaluate and improve their policy-making functions, as distinct from the outcomes of the policies themselves?

It's all part of the cause-effect link articulated by many management models - and indeed by common sense. In order to achieve successful outcomes, we need to identify and improve the 'enabling factors' - what we do within the organisation which generates that success. For service delivery functions, these enablers are likely to include efficient processes, customer understanding, and skilled, motivated staff. But when considering the wider strategic picture, an organisation's (including government's) ability to develop effective policies also becomes a crucial factor. Doing the right things as well as doing thing right, you might say.

It is important here to distinguish between policy-making and the outcomes of that policy. These outcomes will become evident over time once the policy is implemented, assuming some realistic evaluation. But we need the evaluation of policy-making to be a predictor - if the policy fails it's too late then to ameliorate the process that created it. For such an evaluation to be meaningful we need some "proof of the pudding" before we come to the eating stage!

Poor policy decisions are not hard to find, the original Child Support Agency being a good (bad) example. In its original form, the system asked hugely complex questions of both the absent parent and 'parent with care', and relied on their cooperation in a system that benefitted neither of them. Little surprise that the system soon collapsed under its own bureaucracy, and has been extensively revised more than once since.

Good policy decisions can be harder to identify, but are generally recognised by those policies left unchallenged by successive political administrations. The use of community groups and volunteers to supplement, and sometimes replace, the role of social services might be an example. Despite the issues raised by current budget cuts, few would argue that such partnerships deliver benefits both in cost and service terms.

Between the two of course there are many grey areas inextricably linked to political belief. The coalition government's current 'Big Society' theme is based on the philosophy that the balance between public sector and third sector delivery needs to be shifted towards the latter. In such a situation there will be winners and losers, and hence many who fundamentally disagree with the strategy. But the policy development function - government's and others' ability to turn that strategy into successful outcomes - can still be evaluated separately from the philosophy itself.

So how do we do this? Essentially by learning from those previous experiences (good and bad), identifying the key components of good policy-making, and ensuring that we do these well. This is the basis of a model developed and now used by DWP, which in turn draws on Cabinet Office and National School of Government work in this area. Factors such as clear objectives, outward-looking, good analysis and excellent communications are amongst those considered, the principle being that these can be assessed either internally or via feedback from other stakeholders. And by understanding current capabilities in these areas, improvements can be identified and policy-making functions strengthened.

These models are generally good stuff, with many sound ideas embedded. But I have a caveat, something I think is missing from them, and the word I would use is Empathy. Understanding what it's like to be there, or to have this policy done to you. It's precisely why the original Child Support Agency system failed, and why poor policy decisions continue to be made. Essentially, those making or advising on policy are too remote from those on the receiving end, and don't sufficiently understand how people will react to their policies on the ground. Central government in particular has often been good at systems, less good at people.

Ultimately, this could be the make-or-break for Big Society. Assuming we understand its broad intentions, the practical policies we have seen so far are relatively small steps around encouraging more volunteers and central government "getting out of the way" in order to promote community ownership and empowerment. But so what? Society, big or otherwise, is made up of the population within that society, and can only be changed by changing 'hearts and minds' - attitudes and the way people behave every day.

Are the government's policy-makers good enough to deliver this? I leave the question for you to ponder.

Check my web site at www.real-improvement.com for more information and ideas.

*Performance Management and Policy Association, linked to CIPFA

Wednesday, 12 January 2011

Value for Money: Do the Maths!

In these financially constrained times, can there be any public service organisation that isn't seeking better value for money? To deliver more for less? It's a theme beset with problems, partly around the difficulty and pain of any type of change, but also because the concept is such a nebulous one anyway.

To understand why, it's sometimes helps to break down Value for Money (VfM) into the 3 E's: Economy, Efficiency and Effectiveness. The following formulae show the definitions and the "maths" associated with these three terms:


In simple terms, we buy input (materials, staff time, other resources), which then use processes to deliver outputs, and it's the value of these outputs that matter, not just the quantity of them. So the net result is that Value for Money is the value of output (normally referred to as outcomes), divided by the cost of input.

But herein lies the problem: value and money are not measured in the same currency. Money is pounds and pence (or some other coinage), whereas value in the public service arena is something very different. This not the case in the private sector, where despite some increase in social responsibility, the bottom line still rules and hence value generally means more money.

Value in public services is the difference we make, how we change or improve people's lives. It's something akin to what David Cameron talks about when he wants to measure happiness. But these are intangible things; we don't have any standard units of happiness, let alone any conversion formula between these and money.

Value by definition is subjective. Like beauty, it lies in the eye of the beholder. Value for one individual or group may be very different from value as perceived by another. A public park may be hugely valued by some, ignored by others, and regarded as a nuisance by yet others (e.g. because of noise or dog fouling). So any measure of value must recognise the context, and who is judging that value.

There's a lot more to say on this (watch this blog for continued discussion), but the starting point for any evaluation - notice the word Valu(e) in there - of public services or social impact has to be an understanding of stakeholder perspectives. How do different individuals and groups perceive value, and what changes for them? And how do we balance the positive and negatives to determine the overall impact of our services? Robert Burns wasn't a manager, but he put it well in his famous lines:
“O would some power the giftie gie us
To see ourselves as others see us”

Check my web site at www.real-improvement.com for more information and ideas.