Laura Donnelly on overlooking talent

I heard a good story once about David Nicholson. Along with the rest of the 28 strategic health authority chief executives, he was waiting to meet health secretary Patricia Hewitt for the first time. A colleague turned to him: 'Well, David, when you met John Reid you told him you used to be a communist. What are you going to tell Patricia?'

A second's pause, and a hand on hip, before Mr Nicholson's response, delivered in breathy though unarguably Brummie tones: 'That I used to be a woman.' At which point, Ms Hewitt entered the room.

Does this shed light on a more serious issue? I recalled the tale recently, following a conversation with a senior manager about the skills required of leaders in the 'new' NHS, due to embark on the latest stage of its reform on Monday with the launch of the new SHAs.

The ability to adapt to circumstances is vital for all good leaders ? including NHS managers. Those who learned their trade in the 'old' health system will have to be seen to adapt and lead the service into a new set of rules and behaviours. And such changes will need to be more than skin-deep.

The problem is this: when decisions are taken about who these leaders should be, are they being judged on their performance against 'old' markers or their potential to engage in a new order, the rules of which remain ill-defined.

Ideally both; but quantifying the latter foxes the sharpest minds.

While the underlying skills required to deliver the bottom line and hit targets are hardly likely to go out of fashion, leaders running new organisations will need to demonstrate talents and behaviours which the old order neither tested nor required. For those who thrived in a top-down culture, some may not come easy. In particular, engaging with plurality will require some subtle skills: quiet diplomacy, creative thinking and commercial nous may be more valuable than a loud voice and a calculator.

Then there is the question of how rounded the assessments of past performance are likely to be.

Any recruitment decision is bound to be skewed by the pressures of the day. For SHAs and primary care trusts, that means achieving the bottom line. Although the competency frameworks for chief executives of new PCTs promise to assess a range of skills, it will be interesting to see if an assessment of strong leadership capacity ever outweighs a financial red light hanging over their organisations.

And with around a third of NHS organisations reporting some level of debt, is it fair if financial performance alone blights the paths of otherwise promising leaders? For some PCT leaders totting up the sums lost via top-slicing and changes to the tariff, the mood is getting angry.

For those working for organisations which will not reconfigure, the alarm bells are quieter, but perhaps more persistent. An 'integrated process for reviewing board-level leadership' will assess their capability to deal with the increased challenges of their boosted role. If their talents are seen to be lacking they will be dealt with in the, er, usual ways, to paraphrase the Department of Health, and they certainly won't be protected by the human resources framework covering their peers. With the shrinking numbers of jobs elsewhere in the system, an increase in quiet pay-offs or loud tribunals would seem inevitable.

It is hard to devise a perfect recruitment system for a restructure (although the NHS has had plenty of practice), but discrepancies between the way leaders are treated, dependent on whether their organisation will merge, are a bad start.

Not that those applying for jobs in new organisations are having an easy time of it. While the DoH has produced competency frameworks designed to produce a consistent standard of appointment, it is hard to ensure a level playing field between different geographical candidate pools. The risk is that in a successful health economy, the benchmark of quality imperceptibly rises ? which would be no bad thing, except that it risks eliminating strong leaders. More alarmingly, in a less successful area will it slip and allow weaker candidates through? Whatever the standard of competition chief executives are up against, if they fail to get accredited as 'appointable' they instantly fall into a lower pool.

But there is a risk that the standards set at the start of the process (being compared against a 'mythical ideal' as one chief executive put it) slip as reality bites. In round one, candidates are compared against a perfect set of competencies. Those who do not make the grade are eliminated. By round two, the blinkers are off, time is running out and appointments need filling: by now decisions are made against knowledge of the genuine recruitment market. If at this point the value of previously excluded candidates begins to rise, under current systems it is too late: they are ruled out of national competition.

Is this what happened with the SHA appointments? Just five leaders from the old organisations made it on to the final list of substantive appointments, and not all the gaps were filled by leaders from other sectors. As a result, three SHAs are entering a new era under management which may well be talented, but has to be prepared to wear that difficult 'interim' label.

Meanwhile there is room at the top. Applications closed last week for the post of NHS chief executive. So far, there has been a lot of focus on 'outside' candidates, from other sectors and countries. Whoever gets the top job, the notion that transforming the NHS requires skills, style and experience which existing leaders in the service automatically lack must not be allowed to take hold.

The view increasingly repeated by the media and politicians is one which betrays a limited understanding of the complexities of the health service, and the narrow constraints placed upon managers by government. How to refute it? Perhaps it is time for more NHS managers to show off their chameleonic potential.

Laura Donnelly isHSJ news editor