is a catalyst consultancy established in 2006 by Laurie McMahon and Sarah Harvey. Our work focuses on helping organisations, partnerships, teams, groups and individuals understand, shape and respond to the complex worlds in which they operate. We support our clients in setting challenging goals and in developing sustainable solutions and behaviours to keep them on track. Despite Ministers’ assurances that front line health services will be protected as the Government gets to grips with handling the financial consequences of its massive borrowing, few in the health service are expecting financial settlements that will keep up with their rising costs. Our Windmill 2009 simulation looked at how well the health and socail care sector would cope with a financial environment of austerity.The simulation highlighted the differences between the rhetoric and the reality of managing in the downturn.
On the rhetoric side we hear messages that improving quality of care is key to reducing costs and that this will be enough. We hear that commissioners will lead their health systems through the difficulties. We hear that patient choice is still a central theme in current policy and that staff are the most important asset. And we hear that collaborative ‘whole system’ working is the way forward.
Our hypothetical health system however, stuggled to deliver these points in practice. At times the need to reduce expenditure and cope with rising costs and expectations deflected attention from the focus on quality. Commissioners lacked information about the links between the money they spent and the benefits that it delivered for public health and patient experience - presenting real challenges to decisions about how best to target expenditure reductions. Providers, however, having a better grasp on their income and costs and the relationships between the two, moved to collaborate with other partners where there was potential for cost reductions. Convinced that these moves could also enhance and protect services for patients they faced real barriers to ‘whole system’ working from the Foundation Trust regulator and the way it measures organisational performance and sustainability.
Patient choice, which requires an element of spare capacity if it is to work, was seen as a luxury that the Windmill system could ill afford. Private sector providers offering innovate solutions that could save the health system money were swiftly rebuffed as system protectionism and stability became the order of the day.
Staff fared little better as managers felt that engaging staff in discussions about cost reductions was tantamount to turkeys voting for Christmas, particularly where this would involve salary freezes or redunancies. A return to the bad old days of industrial relations challenges looked inevitable.
Windmill 2009 provided a warning of what not to do so what are the positive lessons for health and social care commissioners and providers? You can download the full report from www.kingsfund.org
but here are some of our reflections from the simulation and from working with numerous health systems across the country.
In the post election world the public understand that public expenditure needs to be reduced but Ministerial commitment to real term increases for the NHS may have led many to beleive that the health service is immune from the cuts that will be levied on other sectors. It makes it all the more important that the public as well as GPs and other clinicians are actively engaged in mature and open debates about how resources can best be used. This will need different, deliberative approaches to the typical processes used for public engagement and consultation.
A further difficulty is the preoccupation in many health systems with large scale service reconfiguration where the financial and quality benefits will not be realised for several years. Big changes are important and necessary but they are high risk. Multiple modest developments that will deliver in the short term, the consistent application of tried and tested methods of improving productivity and quality and alternative ways of profiling the workforce are more reliable ways of securing cost reductions.
Capital will be in short supply but there is huge scope to use current building stock across all public services more imaginatively, more productively and more sustainably. The Government may look gleefully at using capital receipts to pay off its high levels of borrowing but must recognise that investment may be needed to support the readjustments that will deliver some of those savings.
The sustainability agenda for most of the health and social care system is a sideshow, despite some impressive strategy documents from the centre. Sustainability is seen as a ‘nice to have’ yet too difficult to contemplate while decisions about reducing costs and protecting services need to be made. Looking at other sectors such as retail and transport however, we see that cost reductions and sustainability, far from being parallel tracks can be mutually reinforcing.
Finally, it is important that the efficiency and productivity spotlight is not solely directed at hospitals. While there has been some national commentary on the scope for more productive community services it is rare to hear commissioners talk about taking 15% out of the costs of delivering primary care. With GP commisisoning collaboratives and the National Commissoning Board set to replace SHAs and PCTs it remains to be seen whether this will be a ‘no go’ area. While GP commissioners will not be commissioning primary care the smart ones will need to look at the way they organise services and practices
As well as supporting local public engagement as part of the Next Stage Review we have also supported numerous Trusts and PCTs on major reconfiguration of health services. Sometimes we are called in to help with the design of the consultation itself but we also provide support to the design of the the front end and implementation aspects of service change. Prior to formal consultations we design deliberative processes to engage patients and the public in understanding pressures for change and in contributing their ideas about principles and future priorities – all of which is important in informing the definition of future options. 
The best way of describing how these work that we have come across is the mirror analogy outlined by Michael Schrage in his book Serious Play: How the world’s best companies simulate to innovate. The mirror is a hypothetical one but imagine how it works. This full length mirror has the power to instantly modify how you look in response to voice commands. You can see how you would look if you lost or gained a few pounds or had an extra session in the gym each week. You could ask it to show you the best and worst case pictures of how you will age or explore what different outfits would look like. What would you ask that mirror and how would its images change how you behave as the real you.