In 1990 what was then called purchasing was developed by a working group known as Project 26. This gives a clue as to how it ranked against other priorities.

This is now changing and many people are questioning whether commissioning is a term that has become so confused that it should be abandoned.

A new report from the National Economic Research Associates/Norwich Union on the future of commissioning splits the term into three parts.

Planning includes identifying need, setting priorities, long-term demand forecasting, financial risk and capacity management.

The purchasing function is procurement, managing the supply chain and relationships with patients, including helping them to navigate the system.

Monitoring and contract management includes transactional services that support practices and other commissioning agents by the provision of benchmarking and other services.

Some of these functions really need to be local and closely connected to practices, local government and other stakeholders; procurement might work better at the level of the catchment area of a large hospital, and others at a level that is larger still.

The key policy lesson from this is that there is no one right size for a commissioning organisation and, crucially, there is no cookie-cutter pattern that can be applied everywhere.

The report suggests the need to apply a new set of approaches, skills, tools and techniques and that a number of these need to be on a larger scale than groups of practices. Epidemiological approaches to needs assessment should be supplemented by methods from marketing for segmenting the population not just by need but by how different groups think about and access healthcare. Actuarial techniques are needed to understand risk and need.

Programme budgeting could at last come into its own, linking expenditure to pathways and quality and outcome data. Legally binding contracts demand a more professional approach to procurement and payment by results requires new data analysis skills.

All of these require expertise that has traditionally been in short supply. The report suggests that some of these skills could be bought in from the private sector and as a way of making a rapid impact this idea is worth thinking about but only if it includes an element of skills transfer.

Some thought will be needed about how these providers can be paid in a way that incentivises them to perform, whether they should compete to provide their services to localities and how delegating some functions squares with statutory accountability.

There has been a tendency to say that, with practice-based commissioning and the proposals in Creating a Patient-Led NHS, commissioning has had its day. While commissioning needs to be redefined, the components of commissioning have never been more important.

Practice-based commissioning will be a powerful driver for change but there are limits to how far the sum of individual decisions can produce major reconfigurations and step changes in how services are delivered.

A reinvented commissioning model offers the opportunity to add real value to the work of practices, to broker solutions, manage exit and entry and could support more radical and imaginative approaches to driving change that will make a difference to patients.

Nigel Edwards is policy director of the NHS Confederation. Commissioning in the NHS: challenges and opportunities was published on 20 June.