The BBC reports that the NHS has been rated as top when it comes to efficiency. Now, that is perhaps a helpful qualifier for when you see those reports describing how the Health Service is underfunded compared to other countries. For example, this report argues that if our spending had kept pace with other European countries per capita then we would have spent £40 billion more. However, it may well be that we are simply using the money more efficiently so that our investment is equivalent to those other countries.
However before defenders of the Government’s track record on healthcare get too smug and opponents become angry and question the reliability of the assessment, remember that efficiency is only one measure. It’s important but its not the be all and end all.
Efficiency tends to be about whether you are spending money in a cost effective manner, it’s about reducing waste to reduce costs. It’s why you tend to end up with centralization of resources and outsourcing in order to benefit from economies of scale.
This led to us sometimes joking, when I was in industry and involved in such efforts, that the most efficient factory would be one that didn’t produce any goods. Imagine the savings on fuel costs, raw materials and wages. So, our hospitals and schools could be more efficient still if they stopped treating patients and teaching pupils. All of this means that a health service can be incredibly efficient but have appallingly long waiting lists, over crowded A&E departments and lots of cancelled operations. In fact, all of those things may well contribute to efficiency and vice-versa.
So, when I was involved in leading process improvement initiatives, I would argue that we needed to talk about effectiveness, not efficiency. Sure, we would want to get the best value for money, that would mean reducing waste and we hoped costs would be lower and margins higher as part of the consequences. But our priority was about ensuring that the work was turned around as quickly as possible and to high standards of quality.
In the same way, it may be a good thing that the NHS is top of the table for efficiency though remember this is only a relative measure but we should be more interested in its effectiveness. That’s why the other measures matter, the quality of patient care and of patient outcomes.
This is true in other lines of work too. And whilst churches don’t tend to get driven by efficiency, even here the pressure can be on to keep costs down but that might not be the most effective way of doing ministry. And here’s the thing, whilst you may get short term efficiency and save money, in the long run it costs you.
P.S – There was a fantastic Yes Minister episode about this
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