Feature / Win-win reaction

Any casual reader of the Institute of Fiscal Studies website – as I heard someone put it over coffee last week – will know we are heading for tougher times for NHS finance than we have seen for decades.

If you plot a graph of the growth we have seen over the past 10 years and project forwards at that rate, and then draw a horizontal line for 2011 for the following years, you will see a rapidly growing gap. The size of the gap, and the prospect that the line might be close to the horizontal for some years, is all we need to know. This is not a challenge many of us have dealt with before. It is not a turnaround job. This calls for a transformation.

Transformational change has many characteristics that go beyond scale and pace of change. A transformational change is more profound and fundamental. It is irreversible, a discontinuous or step change.

Leadership during transformation is also different. For the past six months the NHS Management Board has been changing its approach to leadership, recognising that outcomes on a transformational scale call for big changes in the mindset and behaviour of people across the NHS. It has been working with the ‘five frames’ approach supported by management consultancy McKinsey and the NHS Institute.

Several mindsets need to change if the NHS is to rise to the challenge of the next five years (see box right). Clinical leaders and finance leaders have a central role to play in this transformation. The way these groups react to the situation will define the approach taken by NHS staff and influence the public and media.

The NHS Management Board’s central conclusion is that we should exploit the creativity and potential for innovation of the workforce and the public to drive up quality.

Innovation is as much about the adoption and spread of successful practices as it is about inventing approaches. Some improvements in quality will need investment before the value and productivity benefits are realised. While a new mindset is needed, we must recognise that a traditional approach to productivity may also still have a contribution to make.

But prioritising quality is not how we have tackled big challenges in the past. So why is it right to do so now?

Quality and cost

For the past 50 years, most sectors of the economy have sought to improve productivity through a relentless focus on quality. In contrast, the instinct in healthcare has been to expect improvements in quality to come at a price.

This has begun to change in the past decade. Ten years ago few NHS leaders would have talked of management doctrines such as Lean or Six Sigma. Awareness of the costs of unsafe care has grown rapidly, alongside evidence that levels of safety and reliability formerly thought unreachable are being delivered.

Variation is coming under sharper focus. Warranted variation based on natural variation or differences in patient choices is swamped in most healthcare systems by unwarranted variation due to different local practices or inadequate attention to data and detail.

The box above gives a taste of the evidence on improving quality while reducing costs. We have to treat international evidence with caution, but we should learn from it. Yet, strong as the evidence is, it will not implement itself – for that we need managers, clinicians and local patients. We need leaders at every level to find the right way to meet this challenge, to insist on finding the data to lead this exercise locally and comparisons to show where they have an opportunity to improve.

Every organisation needs enough people with expertise in the science of improvement as much as the science of healthcare. There must be relationships within organisations and between local organisations that are high support and high challenge – that allow the goal of quality improvement for better productivity to transcend parochial concerns.

Two issues stand out. Even where really successful initiatives have delivered improvements in quality and productivity, they tend to stay in a few pilot areas and are not spread. A recent review of the productive ward initiative in London confirmed its impact and potential but showed that as yet only 12% of wards had benefited.

This relates directly to the second big issue – one likely to be conquered by the finance leaders in the service. Some of the quality improvements will be in small areas of activity. A series of small improvements only add

up to a step change if the benefit realisation is managed for this objective. This is where the finance team will be pivotal. There are five measures finance managers can put in place now:

- Take stock While others speculate about the precise national settlement for 2011 onwards, I recommend an honest, searching local stock-take about current quality and the opportunity to improve it. There are a range

of tools designed to help with this, including the better care better value indicators and the opportunity locator from the NHS Institute, the NHS Comparator and the Audit Commission’s payment by results analyses.

Local clinical dialogue is vital. It often follows a predictable initial course of scepticism about the data and the ‘But we are different’ discussion. Yet persistence and working with clinical advocates will help. The data and the dialogue may be somewhat different for commissioners and providers but the wise course of action is to look at both.

- Look at your use of things that work Find out how widely your organisation uses quality/cost improvement tools. I would suggest looking at the NHS Institute website for help on this , or a discussion with our field team as part of this process, but there are many other sources of advice too.

The key questions are: who knows what has been used? How successful have the implementations been? Have the early gains been held? If things that have worked elsewhere don’t seem to have been successful, has your organisation discovered why?

- Get together in your organisation Who is part of the guiding coalition for change in your organisation? It must involve clinical, managerial and finance leaders working together, but who else? What role will the board and non-executives play? How will patients be directly involved? Human resources and organisational development colleagues will have a major contribution to make.

Junior doctors and management trainees can combine involvement with their development needs.

Some organisations are contemplating pairs of managers leading programmes of work and taking a different approach to their normal role – for example, the finance director acting as quality lead and the medical director as productivity lead.

- Look outside too Many people on this journey have decided from the outset to work together as a health economy. In time, the work being led from the NHS Management Board may deliver a better alignment of incentives to this agenda and new solutions that support local improvement. Meanwhile, progress seems much more likely in places where solutions are developed across the length of the care pathway. That means a balance between competition and collaboration; support and challenge.

- Tell your story Finally, but most importantly, transformation means connecting with people’s hearts as well as their minds. Data analysis and project initiation documents have their part to play but often it is the execution skills that let improvement down. Each leader also needs a narrative – a set of stories to tell colleagues and others about innovative approaches to improving quality that also help us cut our cloth to the nation’s needs.

These stories need to be authentic. They will often reveal our own doubts and uncertainties, but they will speak about the changes we want to see for current and future patients in tangible terms. They may take the discussion into territory outside our professional comfort zone. But they are the source of the energy that can transform this challenge from nirvana to a practical reality.

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