- Me to a T
- No shrinking violet
- Whitehall doesn’t do evidence
- Mad Maude
- The Evidence Tour
- Evidence: adult care services
- Failure demand pays!
- BT did it to me
- Who’s the worst?
- Another shocker
- Banking ‘culture’
I have been nominated as someone’s ‘favourite quality guru’. He’s right that I don’t like the term guru, and I want to show readers the nomination statement because he has me to a T:’My favourite quality guru is Professor John Seddon. Although he is no shrinking violet as many in the quality profession will know John doesn’t waste his time jostling for position in the gurusphere, so I suspect that he will dislike the term being applied to him.
My choice is probably influenced by the fact that my background in is management, not quality. Seddon’s fluff-free approach appeals to the busy manager, intolerant of fads and fashions and impenetrable textbooks, who wants to get on with improving the business via reduced costs and improved levels of service. Ordinary managers can understand what he is on about.
And his principles and methods actually work; they are being used by a diverse range of organisations all over the world with consistently positive practical results. We know this because of the evidence published, particularly in the public sector, by those ordinary managers themselves rather than by the quality department.
I think John Seddon’s commitment to, and visible success in, changing management thinking and, crucially, in changing management behaviour, deserves to be recognised.’
And I am most grateful to him.
No doubt my reputation for being no shrinking violet is due largely to my perennial criticisms of politicians. When I began this newsletter many years ago, I had a strap-line: why ministers should get out of management. It is as relevant today. To give just one example, Eric Pickles, minister for local government and communities, is driving councils to share services. Public Finance asked me to blog about it, you can read the blog here: http://opinion.publicfinance.co.uk/2012/07/shared-illusions/
In the same vein I wrote for Public Servant on Whitehall’s failure to ‘do evidence’:
One minister inflicting serious damage on the public sector is Francis Maude, minister for the Cabinet Office. It is he who is making shared services compulsory amongst agencies. I first heard him speak on management issues a couple of years ago at the party conference. His view was that John Major’s Citizen’s Charter was a great step forward. I remember experiencing a deep groan, thinking how little he knows. Apparently Maude worked with Major on all of this nonsense – remember the infamous cones hotline?
A couple of weeks ago Maude announced what a correspondent describes as ‘rank and yank’; a proposal to assess all civil servants and fire the bottom 10%. – straight out of Jack Welch’s book of incompetence for management. What is galling is that Maude will inflict massive damage and never be held to account. Maude was a barrister, has never held an operational position in management, but is now a thought-leader…
Having no traction in Whitehall, I am taking the arguments about what works and what doesn’t work out on the stump. The venues are provided by newsletter readers (many thanks!) and the events are free. There is some poetry here. Politicians behave like experts on management and I feel obliged to behave like a politician – at least in terms of getting out on the stump, certainly not in terms of spinning, fibbing and promoting evidence-less ideology.
Herewith dates and locations:
Crawley, 5th September, 10am
Kingston Upon Thames, 5th September, 3pm
Stone, Staffordshire, 6th September, 2.30pm
Bideford, Devon, 11th September, 1.30pm
London, 18th September, 3.30pm
Carmarthen, Dyfed Powys, 20th September, 10.30am
Doncaster, 24th September, 4pm
York, 25th September, 2pm
Manchester 26th September, 1.30pm
Carlisle, 27th September, 10am
Durham, 28th September, 9.30am
To reserve your place: firstname.lastname@example.org
Last month we saw the usual posturing between politicians from the Local Government Association and Whitehall over social care costs. The LGA used their annual conference to argue that if things go on as they are, in twenty years or so councils will only be providing social care as it will consume their whole budget. It epitomises the role politicians play; posturing over budgets being of greater importance than understanding the problem.
We first presented evidence to the then minister Ivan Lewis and David Behan, the then head of regulation, in 2005. Nothing has changed. Politicians argue that as the population is getting older (true) demand for care services is rising (not true). Regulation of care services is at the heart of the service design problem. Instead of having someone turn up, see what you need to live a good life, you get as many as nine or more people turn up, who all fill in their own forms, who are obsessed with protecting their budgets and who hide behind something called ‘Fair Access to Care Service’, which means those with minor needs are refused support. While these services can be ‘on target’ according to the regulator, they create massive costs: Excessive administration through duplication of activity, costs of provision that fails to meet needs (but it’s what we ‘commission’) and the big cost is from driving people into care homes, where they didn’t need to end up. Behan is now the boss of the current regulator, the Care Quality Commission.
As well as banging on about evidence of the costs of poor design and wrong-headed regulation, we have a series of demonstration designs showing how better service design drives all these costs out. But, sadly, they don’t fit the political narrative. When we showed these to Lewis and Behan in 2005 they were preoccupied with how to get more people to manage their own care budgets. More recently the narrative is all about how to get more private-sector providers delivering care. Both exacerbate the problems.
Throughout the last seven years our innovative designs have been hard to hold on to. The regulator sends out tick-box numpties looking for compliance with their wrong-headed ideas while politicians argue about who is going to pay. It is scandalous.
I referred in the Public Finance blog to Birmingham council’s outsourced contract with Capita (you can find a link to the report in the blog). Politicians in Birmingham have woken up to the fact that they are paying Capita for processing failure demand. Capita must be pleased that the report’s spin is that the call centre they run (‘Service Birmingham’) is ‘not to blame’. Instead blame is allocated to the service departments; if the services worked there would be less failure demand.
We have seen the same phenomenon in the private-sector. Failure demand is an easy concept to ‘get’ and even easier to misunderstand. Some private-sector companies measure failure demand and allocate it to departments with targets to sort out their ‘failure’. Failure demand is systemic. The primary causes are the separation of front and back offices, standardisation and specialisation of work and, overall, a focus on cost management. Blaming the service departments in Birmingham will only delay understanding the true causes and, meanwhile, the private sector will be paid handsomely for eating the muda. Birmingham is just one example, there are many others, as councils have been driven down this route by Pickles and his predecessors.
Recently we moved house. When you move you discover how bad many services are. While none worked cleanly, BT took the biscuit. They started charging us for a line we did not want and to deal with their mistake we had to call a premium-rate telephone line. Maybe we missed the trick in our consulting practice: maybe we should be telling clients to make failure demand a source of revenue?
Long ago a friend suggested I run a competition on who is the worst at service. In that vein I as sent a blog by a man called Frank Chalk:
‘I phoned up four companies yesterday and three of them greeted me with an awful automated voice which invited me to select from some options. The voice then asked me to select from some more, speak my reference number (which they could not recognise) and then played me some music which I did not want to listen to, told me how important my call was and about the unusually high call volumes that they are always experiencing. After a few minutes I was put through to a human who also appeared to be automated.
She asked for my reference number again and then announced that she couldn’t help me, as she could only read out the options given to her by the computer. As she was obviously flummoxed by anything unusual, I asked to be put through to her manager and she informed me that he would only say the same. Bravely resisting the temptation to get sidetracked and ask how she knew this, I begged her instead to give him the opportunity to do so and was promptly put on hold. Several minutes and three songs later I gave up and put the phone down.
When I phoned the fourth one, a cheerful bloke answered the phone, told me he didn’t need any reference numbers as he could just look up my name and sorted out my non-standard request in less than a minute. He said that he would confirm what we had agreed by email straight away (And he did).’
A subsequent posting reveals which companies:
I have been a Vodafone customer for years. I’m one of those customers who just pays his bills and never has a reason to call them, the sort of customer every service business wants. Every two years my contract comes up for renewal and every time it does, Vodafone manage to upset me. As this occasion’s mess-up – which wasted three hours of my time – only became clear after I’d re-signed, I shall have to wait two years before I say goodbye to Vodafone forever.
Cheating on the LIBOR rate and stitching SMEs up with loans with hidden and unfair charges are the latest shocks following the destruction of banks’ liquidity through fraudulent derivatives, flogging mortgages people couldn’t afford and so on. Now we hear lots of talk about the banking ‘culture’ and promises of investigations, inquiries and revised regulation. The issue is straightforward: the banks employ contingent incentives. Contingent incentives (do this to get that) take value out of the work and focus the incentivised on making incentives, not achieving any higher purpose. Contingent incentives should be outlawed.
But that won’t fly, because people believe that incentives drive what they want, that without them people would be lazy. It is not true. Indeed all of our private-sector clients dump incentives when they see through studying what they do and, moreover, when they design sales organisations to work without incentives, sales go up!
The issue of incentives in selling financial services has been discussed for years. Some years ago the Financial Services Authority decided to stop commissions being given to brokers. It has taken years and has been fudged. It just shows how hard it is to go against the grain of current beliefs.