Phil Kenmore examines the challenges facing NHS non-executive directors in driving better organisational outcomes, achieving change and holding executives to account
Being a non-executive director in the NHS is not an easy job. But who would want to do it if it were? The challenge, the complexity and the sense of public value all make these roles worthwhile.But as most NEDs know, the time when people aspired to the role because they wanted to give something back - and thought this meant turning up to a few board meetings and walking the wards occasionally - are long gone.
These roles have fundamentally changed with the advent of foundation trusts. In these organisations, NEDs are there to hold executive teams to account and to drive performance, not to represent the community, which has become the role of the members and governors.
This is probably just as true now in primary care trusts, strategic health authorities and other non-FTs. Although there is still a strong element representing the community, the NED role has shifted as public engagement becomes more sophisticated and the need to drive organisational change and performance has increased.
Many non-execs in the NHS have some private sector non-executive experience, but can still struggle in the NHS context because it requires different influencing skills. The organisational politics are highly complex and the strategic context is largely set by central government policies beyond the control of the board.Driving change, ensuring organisational performance and holding the executive team to account are therefore challenging tasks for the non-executives on the board.
A clear perspective
For most NEDs, the first step to doing this successfully is to understand what their role entails. To drive performance, NEDs must focus on organisational outcomes - not outputs.Processes are good proxy measures, but nothing is more important than the results the organisation produces. If NEDs have a clear view of what these should be, they have a good starting point to managing the performance of the organisation and their executive team.
To do this, NEDs (and the board as a whole) need a clear view of the organisation's strategy.A clear strategy allows NEDs to establish a clear policy for managing the performance of the executives. In other words, what sort of objectives should be set for the executives as a team and how will these drive the outcomes the organisation wants to achieve? What specific measures can be used to encourage the right behaviour to achieve these objectives and what targets can we set?
Once the objectives, measures and targets are in place, the mechanisms for reporting them to the board, and for rewarding the executive team, must be established.
These things are easier said than done in the NHS. Some targets are given - such as for MRSA, 18 weeks, and accident and emergency waiting times - others are seen as "must dos", such as financial balance (or surplus). But the problem now is that the NHS can achieve strong financial performance, but at the expense of quality.
Financial management is clearly an essential part of any business, but the NHS is a customer-driven environment and quality is the cornerstone of its perceived success or failure. NEDs must remember this when setting the framework within which executives are performance managed.
This becomes a significant challenge for those taking on NED roles, who must understand the business of the NHS, how it works, its organisational politics and the ethos of care that underlies everything it does.
Although some people would strongly disagree, it could be argued that the key to maintaining a clear approach to driving performance and holding executives to account is not to get too involved in the care ethos of the organisation. NEDs need to retain an objective perspective to lead the organisation effectively as a board.
Yes, it matters that Mrs Smith in ward X has had a poor experience or Mr Jones has not been able to access his GP, but it is not the NEDs' role to take up these issues. The NED must maintain a broader perspective of the needs of the public and what the organisation can do to achieve better outcomes across the breadth of its work.
It is the executive's role to ensure day-to-day performance meets the standards required and expected for individuals. This is something some NEDs lose sight of, and as a result they become too embroiled in operational detail, reducing their impartiality and their value as guardians of the required strategy for longer-term success.
So what should NEDs do to drive better organisational outcomes, achieve change and hold their executives to account? Here are some top tips:
- understand the business of the NHS in depth, its culture, politics and environment;
- do not get sucked too far into the moral/ethical purpose of the NHS at an individual level - maintain perspective;
- do whatever you can to build a strong NED team and board;
- be clear about the organisational outcomes that are most important;
- set clear objectives with specific measures for the executive team around these outcomes;
- review and act on these with single-minded intensity, do not get distracted by short-term operational or political issues.