EoN team wins award

The leaders and engineers in E.ON’s Central Networks won the ‘One E.ON’ – a pan-European – award for their work with Systems Thinking. It is expected to contribute a massive £230M improvement. Congratulations to all!

Organisations like this are always designed as ‘repair’ organisations. In the traditional (command and control) designs managers worry about engineer activity (jobs per man per day) and service levels (doing things to arbitrary times). When they study the work as a system it reveals that these ways of managing actually drive up demand – we create work for ourselves. It is a salutary experience. We help them change the design from a break-fix (that causes more breaks) to a preventative design, the purpose being to maintain the availability of the system, not maximise their productivity for ‘fixing things’. As soon as the re-design starts demand falls, it blows managers away. Once they’ve got it, managers wonder why they ever thought the stuff they used to do was sensible.

And you only get it when you do it.

Systems Thinker MBE

Norman Dixon, a policeman in Scotland, has been awarded an MBE. Those of you who have seen the 2005 DVD (Freedom from Command and Control) will know Norman as the man who designed local policing against demand to tremendous effect (less problems, happier communities). Norman went from that job to introduce a new hand-held device for front-line officers, and went about it with a systems approach – understand the work as a system, improve it without IT and then ‘pull’ the IT into the new (improved) design. While other police forces have struggled with introducing such technology (because they adopted the traditional, government-inspired ‘design, build and promulgate via Prince 2’ approach), Norman’s hand-held solution works a treat. Hats off to him! The first systems thinker to receive an honour.

Is perfect possible?

A systems thinker working in a local authority writes:

‘I’m working with a service where during ‘check’ we found, amongst other things, a high level of failure demand. We worked to understand the nature and causes of the failure demand; mainly people querying some aspect of the service which had been provided. For example, the invoice often itemised a different service to that which the customer had actually received, and because of the long time delay in issuing invoices, even when they were correct, customers couldn’t remember what service they had received. As you can imagine, there was a mini factory resolving these queries.

When we got to ‘plan’, we designed a system for instant billing with accurate information. After a week, all was well, these invoices were accepted by customers, and nearly all paid, either on the spot or within a day or two of issue. Then the design ‘flaw’ became apparent – we hadn’t designed in a way of quickly resolving invoice queries. This became a major issue of concern to managers. Well, it would, because for years picking up the pieces from the failure of the invoicing system had been a major part of the business, and it was difficult to contemplate life without it, and after all, isn’t some failure inevitable?

However we had designed for success, and had designed failure out, so why would we want to design how to deal with failure? The managers were insistent – there would
some failure, so they had better get ready for it. What a gloomy outlook: ‘we’re bound to get it wrong’. I played them the old Carlsberg ad – the one where the phone rings in the complaints department, and the office so old and dusty that it has obviously been not in active use, and then the call turns out to be a wrong number. Finally I got agreement that we measure demand for a few weeks to see if there was any invoice-related failure demand, before rushing off to work out how to deal with it.

After four weeks, and no invoice queries at all, there is finally, but with some reluctance because it is changing a lifetime’s assumptions, acceptance that we don’t need to invest in dealing with failure.’

South West One in the news

In the meantime, ministers are investing in dealing with failure on a massive scale. While the managers above had a mini factory for waste handling ministers go for the maxi version. One classic example is ‘South West One’, the new call centre for local authority services established as a joint venture between West Country Councils and IBM. The local TV company ran a news feature, it makes shocking viewing. Go to:


HMRC and DWP fail again

South West One is an example of the kind of thing David Varney (the PM’s adviser on public sector reform) has been encouraging. He and the ministers only need to look at the current ‘flagship’ factories – HMRC and DWP to see how costly the factory philosophy is.

A reader writes:

‘Really enjoyed reading the August Newsletter – all the more so when I got home and found my wife had a letter from HMRC. It was unintelligible, unsigned, and offered further information from DWP, but said that DWP would give us conflicting information! And finished up by saying not to write to them or contact them by using the contact number in the letter as they would be unable to assist with the issues raised in the letter!! I have no difficulty in believing they can’t help.’

And again

A reader writes:

‘My company had a VAT audit last week. A perfectly nice chap from HMRC came in. Recently, we have had an unusual situation with some customers that have moved offshore, creating a question mark over their VAT status.

In the interests of openness, full disclosure etc, we had a lengthy discussion with our auditor who asked a number of intelligent questions to clarify the situation. It had already been the subject of a written enquiry to our HMRC office. We asked our auditor whether he could pass on the details of our discussion to whoever would be answering the written enquiry? (You can already guess what’s coming). ‘Erm….no. Written enquiries are dealt with by a separate area. We used to be involved in the whole relationship with a company, but now we just get a list of companies to visit, go in, do the inspection, write the report, and move on to the next one.’

We invest the time of several senior people to explain the situation to an apparently sensible and compos mentis human being. Said human being is (the implication was) not allowed to communicate the content of his discussion to another part of his organisation…………….

It’s hard to stay optimistic!’

And see how a ‘perfectly nice chap’ is turned into a useless dolt by design. It’s the system stupid.

What do dolts do?

A reader writes:

‘I am grateful for your searchlight of clarity in a Catch 22 world. Your ‘Systems Thinking in the Public Sector’ gave me the necessary reasoned rationale that explained much of the current bureaucratic madness within the NHS, and has also prompted me to leave employment in mental health services in order to protect my own sanity.

Just one of many indicative examples of management that knows the quantity of everything, but appreciates the quality of nothing follows. As an Approved Social Worker (ASW), I was responsible for the coordination and leadership of the many services involved in formally assessing people with mental disorders under the Mental Health Act 1983. However, I would estimate that over 90% of an ASW’s work is actually of a far more preventative and qualitative nature, and that we have a wider role than reacting to requests for admission to hospital.’

He went on to explain how working with people in the community can often prevent people being sectioned. The purpose of the work, after all, being to solve peoples’ problems. But, he continues:

‘The ASW’s performance and raison d’etre is measured by senior management purely in terms of the number of assessments we complete. Their first response to a drop in the number of assessments over the past few years was to question the number of ASWs they had to train and employ. The second response was to vigorously enforce the existing monitoring procedures for assessments completed, on the assumption that poor accounting was to blame.

To date, there has been no formal acknowledgement by senior management of the possibility that what I have described as 90% + of an ASW’s work has collectively led to the reduction in the number of assessments needed, or that this work may be of any value to them or our service users. Because of their blind focus on the measurement of activity, an increase in positive patient outcomes has gone completely unheralded, and worse still, it is actually seen as a problem. This ‘rationale’ means that as a professional group, the positive end result of most of our efforts (to which we all remain deeply committed) actually works against our collective interest and future survival!’

So he leaves. And he knows the system is failing. Managers will be reporting as required to the regime and no-one will know of the icebergs ahead.

The right to create waste

Having turned public service workers into useless dolts or driven many of them to resign, the minister, Hazel Blears, announces her latest initiative for improving public services: The ‘right to redress’. If people are unhappy with their council’s service they can claim a tenner. She thinks it will get the councils on their toes. What will happen is growth in bureaucracy for measures to be used in defence of complaints, after all, if a service was delivered to a ‘standard’ managers will claim the complaint is unwarranted. We will also see growth in inspection and, least expensive perhaps, the cost of handing out a few tenners. Who would want to bother for a tenner? If you do bother, Blears also wants you to be able to track the progress of your getting a tenner on-line. More waste.

Having caused local authority services to fail (read the book) we now spend resources on managing failure. You couldn’t make it up.

Spinning participatory budgeting

As well as creating useless bureaucracies for ‘redress’ the minister is spinning ‘participatory budgeting’ (giving people more say in how money is spent) as the latest in local democratic activity. UK initiatives are compared with Porto Alegre in Brazil. But the comparison doesn’t stand up. The exercises in participatory budgeting in UK councils usually amount to less than 1% of the budgets. In Porto Alegre the whole budget – 100% – is up for discussion. And more than that, they encourage local people to set up businesses to provide local services. What is our minister doing? Involving people in marginal, even trivial decisions while encouraging private-sector contractors to take local services away from local people.

More on the cost of targets

Many readers alerted me to reports about the man who took £90K off the NHS by falsely claiming he had helped people quit smoking. The NHS hands out money to people like him; it is assumed this is the best way of meeting targets for smoking cessation. What did they imagine was going to happen?

The Health Service Journal reports that targets in Accident and Emergency have led to increases in hospital admissions. It means they meet the four-hour target in A&E and it means the hospital gets more cash (admissions attract more money from the PCT).

Also reported this month: dentists are putting in more dentures (cheap) and not putting in as many crowns (expensive) because of the way that they are paid under their new NHS contracts.

(Contributions welcome: john@vanguardconsult.co.uk)

It changes your life!

A leader running Housing Benefits in a local authority wrote to tell me that she had seen me speak about Systems Thinking and Housing Benefits, went back to her service and got on with understanding it and then re-designing it. She was proud to tell me they had achieved impressive results and that had aroused the curiosity of other leaders. But of most benefit to her was that doing the work gave her ‘a new lease of life!!!’

And that’s what keeps us all going!