Hamish Dibley

Home » Posts tagged 'Cost reduction'

Tag Archives: Cost reduction


‘Front-to-back’ thinking: the antidote to activity obsession disorder in the NHS

Activity obsession disorder: a curable condition

Activity obsession disorder: a curable condition

In healthcare we obsess with the wrong perspective – I call it ‘back-to-front’ thinking and it drives all NHS healthcare activity. It begins with asking the wrong questions of data, fixating on activity levels and volumes. The logic is as simple as it is unthinking: every annual budget cycle; we try to reduce costs by reducing XX% activity. The one problem with this approach – it never works. Costs spiral ever upwards whilst service outcomes either flat-line or reduce.

In NHS language this results paradoxically in an “over-performance” problem (which sounds positive but is in fact bad) – doing more activity than was stipulated in the contract plan. Consequentially, this leads to a counter-productive reliance on confrontational contracting as the primary commissioning lever. ‘Quality guru’ Brian Joiner refers to this type of behaviour as distorting the figures and the system. Everybody loses. We can’t afford to continue working in this manner.

In fact, it doesn’t have to be this way. There is an approach that is as different as it is revolutionary and has the potential transform healthcare. It can provide commissioners and providers with the wherewithal to achieve meaningful and sustainable change. The better alternative – what I call ‘front-to-back’ thinking is to start with looking differently at the data (as well as using innovative methods to generate new patient-centred data).

‘Front-to-back’ involves studying the nature demand for healthcare services not from the perspective of arbitrary activity numbers but real patients over time-series data. What this typically reveals is that the problem acute trusts think they have – one of rising demand is not actually true. The real problem is what I call ‘boomerang’ demand: comparatively small numbers of patients consuming disproportionate amounts of activity and resource as a consequence of services that are not designed for them.

Asking ‘front-to-back’ questions allows you to study the nature of activity that takes place on patients – how much is good versus wasted work; how much can be redesigned to work differently; how much activity actually should take place at different times, in different ways or not at all! Utilising this approach and its way of thinking then allows healthcare providers and commissioners the knowledge to undertake ‘intelligent system and service redesign’ around cohorts of patients not abstract service pathways.

The holy-grail of better services at less cost is achievable in health but it requires a different way of thinking and then acting based on what empirical data, not opinion, tells us. We can do much better than have to continuously rely on and fail with activity management approaches. Activity obsession disorder is a serious but curable management condition.


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.