Quality improvement and cost reduction

Given the bleak financial outlook for the public sector as a whole, it is not surprising that the NHS has responded with Implementing the Next Stage Review Visions - spelling out the need for step change improvements to quality and productivity over the next three to five years.

No doubt, management consultancies and a myriad of NHS bodies will all produce large documents full of advice, ideas and even standard scripts for simultaneously reducing costs and improving quality.

Such publications are helpful to a point, but few are likely to offer a digestible summary of essential ingredients for getting organisations and their people galvanised and engaged with such a vast programme.

This article aims to provide that, along with a suggestion that in future, NHS leadership will need new qualities adding to its traditional development framework.

Leaders in the NHS, while they have the “good fortune” of being sighted to the scale of the impending financial downturn and having one of the largest government departments as their operating environment, will be searching for some structure upon which to develop and deliver their local plans for action.

Historically, many industries have used five primary-planning components for major change programmes that NHS leaders might find worthy of consideration.

• The first is a need to act. If employees in any organisation feel little pressure to change or have no impetus for action, then disinterest is the likely outcome. It is imperative therefore that leaders create a sense of urgency to galvanise and invigorate the organisation.
• Visionary leadership is another key component. The vision that leaders provide to a troubled organisation needs to offer something that unites the workforce, providing a stimulus for change. A vision offering more than short term survival will also help to avoid a disillusioned talent drain.
• The cure to disengagement is often about the right people doing the right things at the right time. This is an important factor in any organisational programme looking to significantly improve quality or productivity. Therefore, the leadership challenge of ensuring that enough capable people are deployed and engaged in the programme is also a primary planning matter.
• Local programmes will require a plan that provides structure, guidance and an ability to track progress. Tasks should be assigned and broken into realistic actions with responsibility, accountability and clear timescales. This simple format provides no excuse for uncertainty about what’s expected and when. Doable early actions avoid workforce frustration by providing structure, confidence and an opportunity to cite early progress toward to the vision. 
• Lastly, there are few truly successful programmes that do not have some form of integral change associated reward.

NHS leaders will need to consider carefully how a system in which reward linked directly to the improvement programme and the actions within it might be developed. This ensures sustainable results, avoiding the programme benefits evaporating over time.

The five primary planning components for major change:

• Generating a “need to act”
• Visionary leadership
• Capable people
• Doable early actions
• Change associated reward

These five essential ingredients might help to provide some structure and process to the task of planning and delivering major cost reduction through productivity gain. That said, the enormity of scale and the demands for radical change within the NHS are documented and growing.

Leaders within NHS organisations will need more than a well constructed plan. They will need to overlay core-competencies with qualities that were for a long time absent in corporate life and as yet have not featured in traditional NHS leadership development programmes - traits such as bravery and determination will be an absolute requirement for success.

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Slatter S & Lovett D (1999), Corporate Turnaround – managing companies in distress, Penguin, London.

Kanter R M (1983), The Change Masters, Simon & Schuster, New York.

Beckford J (1998), Quality – A critical introduction, Routledge, London.