NHS governance

Like Mr McQuillan, non-executive directors are the outsiders, bringing new perspectives, ways of doing things and points of view.

While they would be highly unlikely to face a Sir Alan Sugar-style toasting there must be times when they wonder why they are sitting in the boardroom: they are poorly rewarded, their skills and experience are undervalued and they feel unable to challenge their fellow directors.

Their situation is unlike that of their private sector counterparts, for whom the rewards are great and who wield real power.

To get an idea about the current state of NHS boards and board members the Centre for Innovation in Health Management, part of Leeds University Business School, undertook a national inquiry into fit-for-purpose governance.

As part of our research we worked with board members from a range of trusts in England as well as representatives from the Department of Health, various commissions and academics. We interviewed and had discussions with participants in groups and individually. We also brought both groups together.

Our aim was to find out how NHS boards were operating in practice and how they could improve, therefore improving the organisations they represent. We concluded that NHS boards have the potential to work well but major reform is needed.

We are not calling for a wholesale cull of NHS board members, more a change in attitude to the untapped potential that sits on NHS boards and a shift from the dominance of the medical profession on NHS governance structures.

The lot of the non-executive director is particularly interesting. The non executive represents the interests of patients and the community and his or her experience in the private sector balances the NHS experience of the executive directors. Their outsider status is a deliberate attempt by government to increase the diversity of NHS boards, however, their skills are under-utilised.

This is, in part, as a result of the NHS’s reliance on an “expert” model of problem solving. Problems are broken down into neatly defined components and the expert in the field tackles that component. But in the NHS problems do not have defined causes and solutions and the non executive director with excellent people skills, for example, is ignored in favour of the finance director who knows the accounts system inside out.

Research participants were asked to give an example of a time when governance worked in their organisation. All the examples were of a time of crisis: everyone pulled together, agreed what to do, drove the solution through and achieved change in the short term. The words the ‘short term’ are key here.

The NHS exists in a culture of panics with little long-term strategy or focus. Change happens in the short term but long-term, lasting reform does not happen. And change can only happen when things have got so bad it has led to a crisis or panic. This culture of panics is a symptom of the expert model and does not play to the strengths of the non executives sitting on the board as it is the NHS ‘expert’ who gets things done.

 A contributing problem is a concentration on the roles of and relationship between the chief executive and chairman, to the detriment of the rest of the board as a whole. We were told of chairs and chief executives holding private meetings and directors unwilling to openly challenge these powerful figures. We also found an overriding focus on the structure of the board with members overly concerned with the number of board members and meetings rather than on the process and dynamics of the board itself.

The dominance of the chief executive and chair is also perpetuated by a lack of engagement with board matters by both executive and non executive directors. Executives see their board role as an adjunct to their main job and we were told of attempts by executive directors to undermine the work of the board.

One NHS chief executive said: “Because the executives didn’t like, or see the value of, board subcommittees, they tried to sabotage their activity. They went in giving very long answers, with 25-page documents.”

Non executives, by contrast, are dropped in at the deep end and given little or no training or idea about what is expected of them in their role.  

We also found tensions between the executives and non executives, heightened by the fact that non executive directors may not have clinical or NHS experience. Tensions and conflict do not have to be negative but they do need to be acknowledged and managed.

One of the key questions we asked was whether there was enough challenge or conflict at board level. And the answer was a resounding ‘no’. This lack of challenge is in part due to the dominance of the expert model discussed earlier in this article and it is a real problem for non executive directors who may be new to the NHS. Non executive directors often struggle to question their executive counterparts and if they cannot do this, then they are unable to perform their role in any meaningful way.

Coupled with this is a lack of or limited information and data provided to board members. Challenging the board without the relevant information is risky for a nervous non exec. Whether this information vacuum is deliberate is hard to say but it leads to a situation where a lack of information enables a power status quo to be maintained.

One of the most difficult roles of an NHS board is the way it interacts with both the organisation and the outside world.

The board is responsible for service delivery but it also needs to cushion the organisation from central government demands and imperatives. The work of the board is inherently political – deciding how to spend public money - but for many board members we spoke to politics is a dirty word and they ignore the political work as much as possible. As a result, they spend far too much time focusing ‘down and in’, on internal management, rather than ‘up and out’, on managing relationships with the vast groups of people with a stake in an NHS trust.

This is where we believe the talents of the non executive directors come into their own and there must be robust recruitment procedures to ensure that there is a balance of skills on NHS boards. Non execs, who may be councillors, local captains of industry or key players in the voluntary sector, need to use their range of contacts outside the NHS for the good of the board and the organisation as a whole. Their political skills are particularly valuable.

For non executives with no previous experience of the NHS except perhaps as a patient the focus on performance management, targets and accountability must be puzzling. It leads board directors to become passive observers, ticking boxes and responding to every policy initiative that comes from the centre. It leads to a situation where there is a concentration of risk assurance and innovation is stifled. Boards need to look at the long term and marry the current emphasis on performance management with the legitimisation of a concern for the welfare of patients and their families.

Serving as a non executive director could be seen as a thankless task but the role is crucial to the successful running of an NHS organisation. Some NHS managers may question the role of the board but we believe that a successful board defines the culture and values of an organisation, giving the managers the power to run the service on the ground.

There are enough individual skills and capabilities on boards to ensure their long-term success. It is now a matter of harnessing those skills. 

Key recommendations from the report

• The establishment of a design team for the board, made up of a small group of board members, given the brief of analysing the board and working up a process for improvements in board decision-making. The team should be made up of a few board members with a clear brief, setting out parameters and expectations. The team should highlight areas of structure, process, style and interpersonal dynamics and work out how to design meetings to improve these
• Board members should  invest time in understanding each other, making the most of what each has to offer. Socialisation can lessen the likelihood of board members splitting into factions and expose tensions. Better understanding of all members should also weaken the chair/chief executive stranglehold on the board.
• Ensuring there are deep and open information sharing across the organisation. Challenge can be harnessed and ambiguity managed if this is the case.
• Commitment to a challenge and questioning. Once board members have good enough information a process of critical inquiry should be embedded in board practice. This culture of open and constructive challenge should be a model for the organisation.
• Regular reviews and debriefs of board meetings and committees to highlight what areas of board process need attention. Practice and reflection leads to improvements.
• Learning - organisations must accept that mistakes will happen but, when they do, ensure that the whole organisation learns from them. Board members have to take personal and collective responsibility for their behaviour and action. There also has to be a sense that in the trust the buck stops with the board.
• “Feedback loops” – to generate an evidence-base for decisions. This means tracking the impact of decisions, and reviewing those to see if they had the impact they were supposed to, and if not why not. This is how an organisation progresses.
• Boards develop the capability to engage with the policy context to make the right decisions for their own trust. Part of this is ensuring boards have the right mix of skills and experience and those recruitment procedures are robust. Non-executive directors have to be clear what is required of both the board and themselves and use their own contacts for the good of the organisation. Part of this is working hard on engagement processes as part of its strategic work.
• Boards establish a unique and important role for themselves as the custodians of the values of the NHS. In driving the performance of their trust the board has to marry the emphasis on performance management with concern for the welfare of patients. The board has to set the climate for operational performance, and has to be the strategic guardian of the organisation.

For more information and to see the report go to:http://www.cihm.leeds.ac.uk/new/2009/07/national-governance-inquiry-launched-today/

http://www.cihm.leeds.ac.uk/new/