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Why am I not surprised?

Guy Danaway upon the vagaries of running any large organisation

I spotted a piece on the website of The Guardian today – written by Toby Helm, political editor of sister paper The Observer – which alleges that 4,000 executives involved in 38,000 ‘exit packages’ implemented by the NHS since May 2010 have been re-hired in one form or another – see here – THE GUARDIAN

Although the situation sounds crackers, it reinforces my belief that one of the inherent characteristics of large organisations is that over time they become idiosyncratic and their systems rife with inefficiency, illogically and stupidity. That’s why management consultants came into being and are so profitable. Any intelligent outsider can spent a few weeks inside an organisation, analysing what it does and how, and pick holes in it. It’s rather like the ancient joke about a person lost in Ireland stopping a local, asking the way to Dublin, and getting the reply “Well, I wouldn’t start from here”. It’s practically a no-brainer.

Decades ago, I worked in a sizeable media organisation. I lost count of the times that senior management, as part of some latest cost-saving drive, pushed experienced middle-management executives out the door assuming that, whatever they did, they were over-paid and inefficient.

Only to discover afterwards that they didn’t appreciate the half of the leaver’s contribution – or indeed how they did it, including the value of their personal relationships with others in the industry which gave them ‘short cut’ routes to solving problems, with the result that they then had to hire (1) someone else; or (2) two or more people; or even (3) the discarded individual back again, on a consultative or freelance basis, to cover the same tasks – all this at an end cost that was far greater than that with which they started.

And yet they somehow found that acceptable – or should that be ‘justifiable’, at least to themselves.

At one point, we became involved in a serious industrial pay dispute. My immediate boss Simon was a recently-arrived accountant and a bit of a maverick free-thinker, unfamiliar with the way things were traditionally done in the media.

meetingI remember one large, fabulously surreal, pre-meeting with our industrial relations department at which management tactics were discussed. The ‘workers’ were seeking a 12% pay rise. At what had become this delicate stage, the IR people recommended that we now make a final offer of 5%.

This was too much for Simon, who launched into a classic off-the-cuff routine broadly as follows:

“Don’t be so ridiculous …!”

Noticing the puzzled and/or alarmed faces sitting around the table, he continued:

“Well, come on, it’s not our final offer, is it? We all know that. Furthermore, the union know it won’t be our final offer. For pity’s sake – we know that they know it won’t be our final offer. Given the way this company operates, it won’t even be our first final offer. What’s more, the union know that we know that they know it won’t be our first final offer. I’ve had enough of this – why cannot we just be honest? I’m telling you now, on the record, that I’m going to ignore your advice. I’m going to go into the next meeting, sit down and tell the union that the Board has said any deal must be self-financing, and that therefore – having done my sums – if we make these listed changes to our working practices, we can save 7% of our budget … and then that’s what they can have as a pay rise!”

In my thirty-five year career, I’ve never seen a set of more stunned management executives as those sitting around the table. At the time, I had to make strenuous efforts to stop myself crying with laughter. Simon’s monologue was like something out of Monty Python’s Flying Circus.

[Shortly afterwards, once the IR department had reported the content of the meeting to the Board, Simon himself was duly made redundant and, as usual, the dispute ended with the union being given everything it asked for. I guess we could be thankful for small mercies, e.g. that we didn’t end awarding them even more that they’d asked for – because that happened more than once in said organisation whilst I was there.]

That’s the basic problem with the NHS. It’s probably no better and no worse than any organisation that’s been operating for six decades and provides a service to the public. Yes, there are inefficiencies. Yes, there are almost certainly unbelievable amounts of money wasted within it. But the people inside it are doing the best they can, given the systems in place.

And yes, you could seek to change the systems, the management hierarchy, the targets, the manning, the administrative bureaucracy, the mountains of paperwork … and a hundred other items. However, my hunch is, whatever changes you made, all you’d end up with is something slightly different but just as inefficient. It’s the nature of the beast.

That’s why the NHS is such an irritant for politicians of all parties. All the projections show that its costs are growing to the point of being virtually out of control. The day is not far off when Britain just won’t be able to afford to pay for it in its current form.

Plainly ‘something must be done’ [in the famous words of King Edward VIII, issued when still Prince of Wales]. Plus, in theory, at least, it must be possible to come up with a plan. But nobody can agree what that plan should be. Most important, in my view, any plan needs to be able to demonstrate that it will be able to do more to solve the basic NHS problem – viz. that it will do more than just leave things as they were before, only different. It has to demonstrate that it will make things better. So far, as far as I can tell, that’s a leap no politician – and no party – had been able to make successfully.

In the meantime, of course, as we see with today’s Observer piece, things will continue as they are.


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About Guy Danaway

Guy Danaway and his family live on the outskirts of Rugby. He is chairman of a small engineering company and has been a keen club cyclist for many years. He has edited Cycling Weekly since 1984 and is a regular contributor to the media on cycling issues. More Posts