The Institute of Leadership and Management (ILM) launched its report last month on Leading Change in the Public Sector 2010.To some this was a surprise; to others it was a sign of hope facing the economic tide that is to come. This disappoints me for a number of reasons, for which I will seek to explain.
Public service has gone through a series of revolutions..The end of the 19th century saw the end of outsourcing to the private sector for many public service functions. It was also suppose to see the end of the management of society by birthright and replaced by professional people with the appropriate competencies to manage. For me the watershed was the Crimean War and the influence of two ladies. The first was Florence Nightingale who showed a disciplined and well-managed and well-trained workforce, could effectively run a large hospital.
The other was Mary Seacole, another pioneering nurse and heroine of the Crimean War. She taught many important skills. The first was to be most clinically effective you needed to provide your service as close to the client as possible. This created more survivors that celebrated the contribution of Mary and lived to tell the tale of the horrors of war and the failures of those who lead people in and out of battle.
The most effective way to allocate resources
Mary showed how to be clinically effective when she provided clinical services on the battlefield. I believe that is why more people survive wars of today. Providing the right support at the coalface has taken a long time to be disseminated as the most effective way to allocate resources. The question that must asked, is this because of ignorance, negligence or because other drivers and vested interests can override this call?
Another of Mary's direct lessons was to use business skills to generate funds to subsidise services for the public. This is a common practise of charities that establish trading companies and transfer its profits to the charity to perform their respective objectives. This is still practiced by some NHS hospitals, by trading in medicines for profit, as there were clear market opportunities.
Some commentators have expressed concern as this trade withdrew stocks from patients who were in need thus letting the secondary goal of letting the market drive developments and sacrificing the basic needs of the patients for which the market was supposed to deliver. It is always important to be reminded to embed the vales into the primary and secondary objectives before embarking on a (charitable) mission.
Indirectly, Mary highlights the importance for reviewing the Private Patients' Cap for the NHS Foundation Trusts. The state cannot afford to pay for the public services that we deserve because we have to guarantee the right of bankers to have embarrassingly large bonuses without them taking responsibility for their actions.
We must now seek to obtain sufficient funds to enable us to provide the services that we require. This we can do by exporting the surplus capacity in the NHS rather than taking out that capacity for short-term financial failings. Allowing the NHS to sell services to those outside of the NHS can do this. This option must be given plenty of publicity, as we cannot afford some commentators to say that there were no options to our current predicament as in the case of the causes of the banking crisis.
We could also export some services abroad as Mary did (she started in Jamaica and ended up helping the British troops in the Crimea before finally settling down in England). Many in the public services in the UK, seek to make cuts and take risks regarding the provision of services. This reflects the old 20th-century thinking, where cost control was the primary driver.
This could work if there is sufficient understanding of cost accounting by decision makers, especially with regards to the difference between fixed, semi-fixed and variable costs. Worst still, if people cannot work out the difference between investment expenditure and costs. The 20th century view of budgetary control represents the belief that income is given thus you control costs and control the organisation.
Silo mentality
This drives the silo mentality that is prevalent in management today. It also supports the individualistic approach to life in an ever inter-dependent world. The threat is that because of a lack of understanding of the above and challenge the recession is made worst by taking out costs that takes out demand for NHS workers and suppliers, that takes out demand for their supplier's workers and suppliers. At the same time capacity is taken out in the public, private and third sectors this can only be replaced by imports.
The solution, I believe, is to export our excess capacity to generate the surplus that will subsidise good public services. This then drives up the competition to improve the quality of services so as to earn the right to export. In the case of health, this would be the provision of clinical services at international prices by attracting people to be treated in the United Kingdom and establishing services abroad.
Last month we saw a private sector organisation take over the running of Hinchingbrooke Hospital, so why can't a NHS Foundation Trust Hospital take over a private hospital or compete in the private sector? I expect that the first cry from the unions will be that we should keep the funding purely from the state. The current economic climate clearly shows the weakness in that argument and should encourage a wider debate about the realities of state funded services, which may be of particular importance to the Americans.
The trade unions will find that it is an opportunity to build up the workforce and their membership by supporting this call. This is not to say that it is vitally important to defend the values of the NHS and to hold people to account for potential excesses. The rewards must be great but so are the risks. These must be acknowledged, controlled and have sufficient contingencies to enable all to be assured that this is the right direction.
Michael Parker is the chair of King's College Hospital NHS Foundation Trust and a board member of the Food Standards Agency
• To learn more about Mary Seacole click here
From Flip Chart Fairy Tales
From Bubb's Blog
From Whitehall Watch
