The recent furore about the leaked McKinsey report on the NHS casts a fascinating – and rather depressing – light on current health debates.
First – and this can be a good thing – we saw a lot of passion and commitment. But this sometimes means that emotion takes over from fact. And there is frustration as well; all sides in these debates act and speak as if others have stopped listening to them. They might well, unfortunately, be right.
Secondly – and this was predictable – many commentators and protagonists decided to attack the messenger rather than the message. This was partly because the report was leaked and not published. Equally, a lot of people find it easier to moan about management consultants getting involved in their sector than to address the serious questions that McKinsey raised. After a decade of unprecedented and very welcome increases in NHS spending, the future now looks a lot less rosy. Some uncomfortable and difficult choices will have to be made.
And thirdly, the discussion about the role of management consultancies is wrapped up in mystery and needs to be based on more facts. In one national newspaper I noted correspondents who rested their arguments on ‘the latest rumour is’ and ‘I have been told that’. They are representative. Others see management consultancies as proxies for the government and NHS policies that they don’t like or, worse, as Trojan horses for privatisation. Management consultancy is caught in the crossfire of the wider NHS arguments.
The new Management Consultancies Association report Improving care, reducing cost opens up the facts about the NHS’s expenditure on management consultancy and, particularly through case studies, how the money is spent.
In 2008, the NHS spent around £300m on consultancy, around one third of one percent of its total budget. This is roughly a tenth per employee of the average for large organisations in the private sector. Many of our case studies point to savings and efficiencies worth far in excess of the investment in consultancy.
We have also suggested some ways in which both the NHS and consultants could work more effectively to help provide even better value for money. There needs to be a clearer distinction between consultancy and interim managers; and we would like to see greater sharing of risk and charging according to outcomes, rather than just inputs.
Our case studies show that the vast majority of management consultancy projects in the NHS are about the detailed implementation of ideas and policies that aim to improve patient care and to reduce the cost of doing so. Consultancies are used to do this work because it would be impractical or far too costly for the NHS to do it in-house.
Our NHS is one of the two or three largest organisations in the world; it would be extraordinary and a denial of the public interest if it did not have access to the best outside advice, expertise and skill that is available.
Alan Leaman is chief executive at the Management Consultancies Association
