The term “innovation” is SOOO confusing. We regard innovation as a core part of the QIPP equation for delivering NHS quality and cost improvement goals. Yet in NHS reports and in the wider academic literature, the term gets used in a thousand different ways, with different meanings. In broad terms, we can talk about innovation as “doing things differently and doing different things”. However, as soon as we try to be more specific, we run into problems.

NHS leaders keep asking me for help in making sense of innovation. What kinds of innovations are most likely to result in the improvements we seek in quality and productivity? Where should we concentrate our innovation efforts? So with thanks to Kathryn Baker, I want to suggest a framework for thinking about different kinds of innovation which helps to make sense of the potential of the I in QIPP. In this blog, I want to discuss the differences between process, service and strategy innovation. Next time I will explore disruptive innovation (about which a lot of nonsense gets talked in the NHS).


I’ve shown some health and social care-specific examples of process, service and strategic innovation in the table below.


Process innovation

Service innovation

Strategic innovation

·         Redesigning the appointment process in the GP surgery

·         Reinventing the triage process in Accident and Emergency

·         Making it easier for patients to order repeat prescriptions

·         Redesigning the job application process within recruitment and selection

·         Introducing a rapid turnaround “one stop shop” for outpatient testing


·         Creating new specialist services in the community, eg, intravenous therapy, deep vein thrombosis, complex wound clinics

·         Introducing hyperacute stroke services across the city

·         Creating a “virtual” induction for all newly appointed clinical staff

·         Radical redesign of the clinical pathway for people who break their hips

·         Introducing “virtual wards” for intensive support outside of hospital

·         Transforming the paradigm of urgent and emergency care across the community

·         Designing radical new integrated models of health and social care for people with long term conditions

·         Shifting power: patients, families and communities as co-creators and producers of health

·         Building new approaches to large scale change based on mobilising principles from social movements and community organising



Process innovations are those that reduce or eliminate unwarranted variation and/or activities that do not add value from an existing process. They tend to be narrower in scope than service innovations, focussing on a discrete part of, or contribution to, a wider service, typically without changing the nature of the overall service or patient pathway. Generally, they are less complex and quicker to implement than the other types of innovation but offer less potential to deliver significant outcomes in terms of quality and productivity improvements. Process innovation is the most common type of innovation in the NHS by a long way.


Service innovations seek to improve (incrementally) or transform (radically) an offering for an entire service or pathway of care, typically covering multiple processes. Service innovation brings more risk than process innovation since it is more complex and the innovation is more likely to cross existing departmental or organisational boundaries. However, the quality and productivity gains of service innovation are typically more significant than those of process innovation.


A few years ago, the NHS Institute worked with the Health Services Management Centre Birmingham on a programme to help local commissioners bring care closer to home. The joint Institute/ HSMC team created a typology of service innovation which didn’t really spread beyond the boundaries of the initiative at that time but which is highly relevant for our QIPP deliberations today. I’ve updated it slightly to incorporate some more contemporary aspects. Strategies for service innovation include:

·         Integration: creating more effective relationships between the contributions to the health and social care system which result in seamless, integrated care

·         Substitution: providing higher value, lower cost care for patients or service users through:

       location substitution: substituting high tech clinical environments for community based settings

       skills substitution: enhancing the skills of specific groups of staff to undertake roles previously undertaken by those with a higher skill level, for instance enabling nurses to prescribe drugs, a role that was previously only carried out by doctors

       technological substitution: maximising the use of new technologies in the service. A specific type of technological substitution is channel shift by which organisations seek to encourage their service users or patients to access or interact with services via channels other than those to which they are accustomed. A typical channel shift is moving from face to face or phone interaction to self-service online.

       clinical substitution: moving from a medical care model to community care or family or self care model

       organisational substitution: looking at a wider range of providers to those who have traditionally delivered NHS care, for instance voluntary and community groups and social enterprises.

·         Segmentation: grouping patients by their specific requirements and designing discrete services around that group of patients in ways that enable them to get the service they want and need at the time they need and want it.

·         Simplification: counterbalancing the risk of creating extra structures and extra complexity, ensuring that every step in the care process adds value for patients and minimises the potential for additional costs as a result of the innovation. An importance aspect is reverse innovation – decommissioning an activity that is shown to have no added value or that has been replaced by something new or better. 


Service innovation in healthcare may involve any combination of the strategies above. Sometimes, things go wrong because a service innovation does not involve a wide enough range of strategies. For instance, the Institute/HSMC team identified a common scenario across the country where commissioners introduced a new service with the intention to substitute a hospital based service with a more cost effective community based service. However, the change was not followed up with simplification: the hospital service continued to operate in parallel so the service ended up being “doubled up”, in multiple locations. This makes an important point about the relationship between service innovation and productivity.  Service innovation per se does not necessarily lead to enhanced productivity.  It only improves productivity if it is implemented and diffused in a way that leads to more effective outcomes from the resources invested. If service innovation is not managed effectively, it can end up costing more.


Strategy innovation involves us thinking in an entirely new way about the basis on which our organisation, system or industry operates. As Gary Hamel who pioneered the concept concludes: “the question today is not whether you can reengineer your processes; the question is whether you can reinvent the entire industry model”. Most organisational innovation in the NHS is at process and service level, but these innovations may lack the pervasiveness to deliver change at the scale or pace we require.  Strategy innovation is relevant when we face financial and technological challenges that can’t be met without abandoning the prevailing management model and rethinking the system. In our current context, as NHS leaders, we may need to fundamentally reframe our thinking about the relationship between cost and quality and the activities that our organisations or communities need to undertake to deliver the value that service users need within the resources available (strategy innovation).

So, what conclusions can we make about process, service and strategy innovations in an era of quality and cost improvement? Firstly, that the discrete incremental process innovations that dominate innovation activity in the NHS will probably be insufficient to deliver the ambitious goals we seek. Lots and lots of process innovations won’t add up to service or strategy innovations. On the other hand, if we just concentrate on large dramatic changes (strategy innovation) there is a risk that we will miss the incremental impact of multiple small process innovations. In reality, we need all three kinds of innovation in a balanced approach.

Some references and resources

Bevan H, Plsek P, Winstanley L (2011). Leading Large Scale Change: A Practical Guide. NHS Institute for Innovation and Improvement.

Williams L (2011)Organizational readiness for innovation in healthcare: some lessons from the recent literature. Health Services Management Centre, University of Birmingham

Baker K (2002). Innovation. Retrieved from

Parker H (2006). Making the shift: a review of NHS experience. Health Services Management Centre and NHS Institute for Innovation and Improvement

Hamel G (1998). Opinion: strategy innovation and the quest for value. Sloan Management Review. Winter 1998. Page 7.

Barsh J (2008). Innovative management: a conversation with Gary Hamel and Lowell Bryan. McKinsey Quarterly 2008, no.1.

Maher L, Plsek P, Bevan H (2008). Making a bigger difference: a guide for NHS front line staff on assessing and stimulating service innovation. NHS Institute for Innovation and Improvement