The NHS plan is typical of plans written by policy wonks. It has lots of admirable goals but is very weak on practical steps to enable the NHS to achieve them. It pays no attention to operational management and when it does, what it suggests will only make things worse. This lack of attention to the role of management in making the NHS machine function will undermine the goals, seize up the gears and will fail to improve outcomes or efficiency. By Stephen Black

The big switch in planning philosophy

Once upon a very different time the point of NHS reform was to break the NHS up into smaller units who had the autonomy to make better local decisions in organisations with a sensible scale. The diseconomies of scale were thought to be just too big to achieve innovation and improvement managed from a single central body. This wasn’t just a naive belief in competition (which left wing analysis of the Blair reforms often alleges) it was based on a good analysis that suggested the NHS was just too big for change to happen quickly.

The biggest reason that local autonomy didn’t have a bigger effect was a lack of management capacity across the system not the supposed inefficiencies and coordination failures of competition

The new plan goes in the opposite direction and will try to centralise things instead. The centre will tell local bodies how to do their job. The idea of competition between NHS organisations will be expunged from history like private property after a communist takeover. The idea that local autonomy to experiment would drive faster innovation and improvement than central control has been abandoned.

This shift has, it seems, been driven by a belief that the autonomy intended in the Blair reforms didn’t drive enough of the innovation or improvement it was intended to achieve. While this may be true, that view omits important issues. While the Blair reforms intent was to increase innovation, the government as a whole were not exactly aligned around that goal.

The ISTC programme, for example, was intended to spur the adoption of novel clinical processes by injecting a strong dose of competition into elective surgery. The driver of this would be competition and patient choice (as patients could choose a faster or more convenient ISTC over their local hospital, forcing local hospitals to improve.) But Gordon Brown’s Treasury rules imposed criteria that, in effect said, you can only have ISTCs if they don’t have a significant effect on local services, thereby negating the very incentive they were originally designed to create.

Moreover, the biggest reason that local autonomy didn’t have a bigger effect was a lack of management capacity across the system not the supposed inefficiencies and coordination failures of competition. This will be a worse problem in the new NHS as the new plan doubles down on previous errors when it comes to management.

There is a huge hole in the NHS plan where management ought to be

Management is, as I’ve argued before, essential for the smooth functioning of any large organisation and the NHS is very short of management capacity. But the system often treats managers as an unnecessary overhead that parasitises the system, taking money that would better be spent on “the front line”. 

In the NHS managers should be the ones designing simpler administrative systems so the front line has less paperwork and can spend more time with the patients

An analogy: imagine you try to cut down the cost of running your diesel car by never putting any oil in the engine. Pretty soon the engine will seize up and the car won’t get you from A to B at any cost. It isn’t worth pushing this analogy too far, but the results of not having enough management are the same: the organisation grinds to a halt; improvements in efficiency don’t happen; improvements in quality don’t happen; the NHS stops moving forward. But, like engine oil, management seems dirty, black, you’d rather not have to deal with it if you don’t have to and it is often neglected until it is too late.

I mention this because just about the only mention of management or administration in the plan goes like this:

Making further efficiencies in NHS administrative costs across providers and commissioners, both nationally and locally. This will save over £700 million by 2023-24, comprising £290 million from commissioners and over £400 million from providers. We will ensure that an increasing share of the NHS budget is invested in frontline services by simplifying costly and overly bureaucratic contracting processes…. We will require commissioners and providers to continue to redesign and reduce the costs of transactional services. All core transactional services, such as processing invoice payments, will be automated over the next five years. 

The focus here is on reducing management costs. But also on reducing complex administrative systems. The problem being that the very people needed to redesign and implement simpler systems are the ones you have just fired to reduce management costs. The goals are stupidly contradictory. 

The role of good managers in any organisation is to support the operational side of the team. In the NHS managers should be the ones designing simpler administrative systems so the front line has less paperwork and can spend more time with the patients. And they should be supporting improvement efforts to help doctors and nurses redesign the way they work to improve quality and make them more productive.

The NHS is already extremely short of managers who do any of that. That shortage is one of the causes of the high administrative burden currently weighing down the front line staff. If the systems are badly designed and there are not enough people to operate them, then the burden falls on the doctors and nurses and detracts from their ability to care for patients.

Reducing the spend on management so the money can be diverted to the front line actually reduces the amount of time the front line staff can spend with patients. And lowers the chance that those systems will be redesigned to be less burdensome. Paradoxically, this administrative burden on front line staff is often blamed on management and used as an excuse to cut management even further.

This naive attempt to achieve better “efficiency” through cost cutting doesn’t just affect management. The plan is also targeting a reduction in non-clinical space. But those reductions are hitting staff rooms and other shared space. Which means the staff who need to behave as a team no longer have any space where a team can meet.

Ever been to a Google office? They throw money at the environment and the space to push up staff morale and productivity because a small improvement in the space efficiency of the office is far less important than maximising the productivity of the teams who do the work. Many NHS facilities are already so cramped they are unsafe and uncomfortable. Squeezing them harder isn’t the route to a productivity miracle.

The problem with the plan is that it doesn’t seem to have thought through how to achieve its ambitious goals. It wants to achieve better coordinated care and more productive clinical processes but it has no clue how to do that other than by taking tighter central control on how things work (and telling everyone that apps and AI are the future). The problem with that is the centre doesn’t know the best way to do things and is far too slow to adapt to local circumstances. It needs a significant amount of management capacity across the system to design and deliver new ways of working and, instead, it has decided that the right response is to cut that capacity further.

The fastest way to improve the NHS is more management not less

I’ve argued several times (see this LinkedIn article and this blog arguing that “more resources to the front line” is one of the dumbest political slogans) that the NHS is severely undermanaged. But I’m not a lone voice. We have plenty of evidence that more management improves the quality of care, the financial performance and the productivity of healthcare. (this from the early 2000s is a good summary as is this recent article calling for more managers not fewer).

The NHS is obsessed with leadership but ignores the value of management. But the idea that great leaders determine the results an organisation gets is just a popular myth. Stephen Bungay argued this in his book The Art of ActionHe compared the performance of the German forces in Morth Africa in WW2 with the performance of the British and allied forces. An inferior German force performed remarkably well against a larger British run force who only, eventually, defeated them at El Alamein through vastly superior numbers.

This is often seen as a result of the Germans being led by a great general, Rommel. But the reality was that the Germans did well because of a superior management infrastructure: their officers and NCOs were trained to follow broad orders but to use their own discretion to find the best way to achieve their goal; the British were told to follow orders whatever happened and were far slower, more inflexible and less innovative when things didn’t turn out the way they expected. The Germans continued to behave more effectively even when they were not led by Rommel and soldier for soldier they performed more effectively than their enemies for most of the war. The secret wasn’t leadership, it was a more effective management doctrine. Not “more resources to the front line” but better management of the resources they had.

I mention this because, in addition to cutting an already weak management infrastructure, the NHS is shifting even more to a “do what you are told” management model where local autonomy to innovate and problem solve is being replaced by a “follow your orders” philosophy where the center tells everyone how to do their job. This compounds the current management problems of the NHS making it far less likely that the goals to improve and to use available resources more effectively will be achieved.

The NHS needs more management and a better philosophy of what it is that management does or it has no hope of achieving the goals set out in the plan.

The plan will fail because of this omission

The NHS plan is necessary because the NHS has to justify how it will spend the extra money the Treasury has given it. And it sets out good clinical goals for how to shift spend to areas where money is most needed.

That is all fine and dandy, but the plan says essentially nothing about how that will be achieved at the front line. More management and more capable management are essential if the NHS is going to achieve its goals. Good management is far more important than the new apps and AI that the plan does waste time talking about.

The lack of attention to and the antipathy for management will come back to haunt the system in the future. The plan will fail, but, if history is any guide, management will get the blame.