hamish dibley

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Demand management: a problem in search of a solution

Understand Your Customers#

Earlier this year a report by the Royal Society for the encouragement of Arts, Manufactures and Commerce (RSA) entitled ‘Managing Demand: Building Future Public Services’ sought to bring ‘clarity to the concept’ of demand management. Yet, upon reading the paper it is clear that it launches into several variations of well-reversed, warm-worded but wrong-headed themes from active citizenry, ‘co-production’ to ‘nudge’ and ‘networks’. That’s a pity as the term itself is relatively uncontested with the focus being on internal cost-efficiency.

Of course, a home truth is that demand management in reality is often made-up of three components. First, it represents a euphemism for restricting access to services. Second, it is used to encourage the growth of self-service approaches to public provision including service automation, colloquially known as digital-by-design. The third element of usage is behavioural change to reduce demand through ‘changing citizen expectations’.

The authors state that demand management is ‘an area of emerging thinking’ and not core work in many local authorities. Yet, they neglect to acknowledge that in practice demand management leads directly to rationing via eligibility criteria and the like, reducing the need for direct provision and pushing self-management back to the service-user. They conflate two approaches – studying customer demand and designing against it with behaviour change. Behavioural insight strategies assume interventions need to take place on the individual rather than the service. Consequently, approaches such as ‘Nudge’ seek to solve the wrong problem.

In service organisations, demand can only ever be understood as person or customer derived. For example, you cannot, as the paper asserts, successfully address ‘failure demand’ – a form of system waste – through prodding people to change their behaviour in response to services that are not designed to work from their perspective. How local public service organisations understand and respond to this demand is what counts. And on that, the paper is both incoherent and lacks detail.