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Author: John Storey

Managing the NHS

Updated Tuesday, 9th January 2007

Can Gerry Robinson Fix The NHS? raises issues about managing an organisation such as the NHS, as John Storey explains.

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The programmes Can Gerry Robinson Fix The NHS are interesting and revealing on a number of levels. Most immediately apparent is the tussle between the two main protagonists - Gerry Robinson, the business guru and Brian James, the Chief Executive. At another level, the programmes represent a microcosm of many management issues in the NHS.

Through the two main characters, the programmes nicely set up a dramatic tension between different management philosophies. On the one hand, Gerry continually urges a hands-on, close engagement style where small changes can yield big outcomes. On the other, Brian leans towards a more arms-length, strategic planning approach. In Gerry’s eyes, there are numerous instances where ‘no day-to-day management is going on’, while from Brian’s perspective, Gerry misses the bigger picture and over-concentrates on detail.

The Rotherham Foundation Trust is one of the 165 Acute Trusts in England, each usually responsible for a number of hospitals. Fifty-two of these (including Rotherham) have so far gained Foundation Trust status and have thus, nominally at least, gained a greater degree of autonomy. In reality, the trusts operate within complex layers of governance, management, regulation, financial auditing and statistical monitoring and benchmarking.

"the tension between managers and the clinicians has its origins in the way the NHS was established in 1948"

A sub-plot shows itself in the tension between managers and the clinicians; this tension has its origins in the way the NHS was established in 1948. What does it mean to manage in the context of the health service today? The doctors in particular remain well-organised and politically adept. As one of the Rotherham consultants observes, managers are there simply to ‘facilitate’. Other staff, non-managerial as well as managerial, are amply aware of the power of the consultants: ‘Who runs the hospital?’ asks Gerry, and the answers are clear. In their frustration junior managers depict consultants as ‘recalcitrant’, delinquent and prone to ‘tantrums’.

While Brian is being ‘educated’ by Gerry, there is also evidence of the educating of Gerry. He begins to learn that there are ways in which an NHS trust is not just another site for the exercise of conventional management practice. NHS trust ‘chief executives’ may carry a title familiar in other organisations but, in the NHS context, it is a role circumscribed by political, economic and social imperatives.

The NHS is a political institution. Overall policy is set by the Secretary of State for Health – and the Prime Minister and Cabinet Office are also known to take a direct interest. The Department of Health often responds to immediate political pressure imposed by the news media – priorities are set from above and they fluctuate. As the Rotherham Chief Executive points out, there is a constant and heavy stream of new guidelines and policy papers which have to be taken into account. Moreover, the multiple stakeholders have divergent priorities. Politicians want to avoid adverse publicity while also instilling a sense of progress. MPs, councillors and the press also usually take an interest in the workings of ‘their’ local hospitals. The priorities of these different bodies are often at diametric odds.

"the local health authorities simply can't afford to pay for increased activity"

The economics of health are also important. A key part of the current reforms is the introduction of market-like mechanisms: patient choice, payment-by-results, ‘challenge’ and competition from other hospitals and from the private sector, all suggest conventional market competition. In reality, however, these are only part of the picture. The new ‘incentives’ prompt responses which amount to ‘gaming’. For example, tariffs supposedly allow the money to follow the patient. And at times Gerry seems to behave as if the name of the game is to ensure the hospital ‘business’ maximises this income. But in practice there is rationing. The local health authorities (Primary Care Trusts) have limited budgets – many are in the red but, even if they are among those which are breaking even, they simply cannot afford to pay for increased activity that may be offered by their hospital providers.

In addition to the political and economic context, there is a strong social and professional ethos in the NHS. Recently, staff have begun to argue that the intensified levels of performance management through targets and measurement threaten to undercut this goodwill and could thus be counterproductive.

"‘we are all in this together’ is very familiar to chief executives in the NHS"

To help cope with these many tensions, the NHS has developed, and continues to develop, a whole range of devices. Apart from Chief Executives, there are trust boards with executive and non-executive directors, there are ‘clinical directors’ (designed to bring clinicians into management), and in Foundation Trusts there are governors and members to represent the local community. Other reforms include practice based commissioning which is designed to allow GPs to divert resources and activity from expensive hospitals. These and other innovations are intended to boost the power of purchasers (PCTs) and to diminish the power of providers (the hospitals). Another very important method is the monitoring of activity through clinical audits and benchmarking.

Despite all of these, it could be possible for Gerry to argue that chief executives can and should ‘manage’ by seeking to engage with the range of staff. Arguably, this collaborative style could be extended beyond the boundaries of the hospital to include the PCTs. The ‘we are all in this together’ proposition is one very familiar to chief executives in the NHS.

Given that managers in the NHS need to manage upwards, downwards and horizontally, the extent to which Gerry can ‘fix’ the NHS in the manner he prescribes is open to question: it is undoubtedly a partial solution. Many chief executives do seek to manage in this participatory way and it can deliver results; but on its own it is clearly not enough.


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