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Welcome to the new Update and the Herbert Simon Institute
As regular readers will know, Update was
previously published by the Centre for Public
Policy and Management (CPPM) at Manchester
Business School (MBS). As you will see from
the front, it is now the bulletin of the Herbert
Simon Institute for Public Policy and
Management, in collaboration with Health
Policy and Management, and IGOV.
So large is this network that last summer we
were able to publish The Alternative
Comprehensive Spending Review, in advance
of the Governments own review, covering most
areas and issues in public activity in the UK.
So the Herbert Simon Institute together with
Health Policy and Management and IGOV
subsumes most of the activities of the former
CPPM, whilst broadening and deepening our
capacity and networks.
We hope you continue to enjoy Update and are
able to participate in some of the many activities
being organised by the Herbert Simon Institute
in the future.
The Herbert Simon Institute is a new institute
both within MBS and across the university. It is
a research centre within MBS that brings
together more than 60 scholars who are active
in the public policy and management field. But
it is also a network of dozens more academics
working across the University on public policy
and management issues in social sciences,
education, health, international development,
environment and many other fields.
Names and contact details
Lawrence Benson Lecturer
0161 275 7790. [email protected]
Julian Bond Senior Fellow
0161 275 7780. [email protected]
Alan Boyd Research Associate
0161 275 2923. [email protected]
Stephen Brookes Senior Fellow
0161 275 0552. [email protected]
Naomi Chambers Senior Fellow
0161 275 7964. [email protected]
Nick Clifford Senior Teaching Fellow and
Business Development Manager
0161 275 6531. [email protected]
Richard Common Senior Fellow
0161 275 2919
[email protected]
Gill Harvey Senior Lecturer
0161 275 2902. [email protected]
Carole Johnson Lecturer
0161 275 3794. [email protected]
Su Maddock Senior Fellow
0161 275 6400. [email protected]
Ann Mahon Senior Fellow
0161 275 2913. [email protected]
Adrian Nelson Research Fellow
0161 275 3790. [email protected]
Liz Smith Research Associate
0161 275 3791. [email protected]
Ann Shacklady-Smith Senior Fellow
0161 275 [email protected]
Eileen Spencer Research Associate
0161 275 2889. [email protected]
Colin Talbot Professor
0161 275 0508. [email protected]
Kieran Walshe Professor
0161 275 3852. [email protected]
Jay Wiggan Research Associate
0161 275 2916. [email protected]
Amanda Shephard Fellow
0161 276 5880. [email protected]
Leadership development
for the public sector
The Herbert Simon Institute
Gillian Appleby - Administrator
0161 275 0565. [email protected]
Matt Baker - Editorial Executive
0161275 0554. [email protected]
Manchester Business School
Booth Street West
Manchester M15 6PB
Tel: +44 (0)161 275 2908
Fax: +44 (0)161 273 5245
E-mail: [email protected]
www.mbs.ac.uk/cppm
The Manchester Masters in Public Administration
On the Manchester MPA you’ll learn concepts and skills
needed for leading modern public services, gaining
unique insights from staff who’ve worked and consulted
extensively in the public sector, both in the UK and
internationally.
For informal enquiries contact
[email protected]
www.mbs.ac.uk/admin
The MSc Healthcare Management
On Manchester Business School’s MSc Healthcare
Management you’ll gain a broader understanding of
healthcare management issues and a deeper insight
into your own healthcare system. You can choose a
route through the programme to suit your own
career goals.
For informal enquiries contact
[email protected]
www.mbs.ac.uk/health
For more information on both programmes call:
+44(0)161 306 1339
How to prevent
organisational failure
Update
Herbert Simon Institute Spring 2008
News
The team of Kingsley Purdam and Paul Norman
from the Centre for Census and Survey Research
(CCSR) and Peter John and Stephen Greasley
from the Institute for Political and Economic
Governance (IPEG) presented evidence
regarding the factors informing council size,
highlighting issues such as democracy,
representation, population change and public
service delivery and management.
Their research included a review of past
decisions on council size in the UK, case studies
of council size in four other EU countries, an
assessment of statistical evidence in the UK and
a panel discussion of stakeholders and experts
from across the UK to discuss the key factors
to be considered in determining council size.
Council Size
and Democracy
Dr Kingsley Purdam, a research fellow at the
CCSR, explained: “Council size, in terms of
the numbers of councillors, is a crucial aspect
of local democracy and may contribute to the
effective management of public services. It is
therefore vital that the procedures for
determining council size are robust, based on
best practice and capable of anticipating
future change.”
A team of University of Manchester researchers
have developed a database and decision support
system to help the Boundary Committee for
England decide on local electoral arrangements
relating to council size.
Taking into consideration the future role of
councillors as outlined in the 2006 Local
Government White Paper, the research showed
that the numbers of councillors varies
considerably across different areas and
comparable types of authority in the UK and
other European countries.
True value of
water-cooler
networking
revealed
Dr Purdam added that while there may be
formal processes of review there is an element
of historical accident in the number of elected
representatives each council may have. Any
increase in the number of elected representatives
per area, he suggested, could be used
strategically in priority areas as a driver for
increasing civic engagement and for tackling
deprivation.
For further information please contact Dr.
Kingsley Purdam, CCSR, University of
Manchester. Email: Kingsley.purdam@
manchester.ac.uk
A study from Manchester Business School’s
Institute of Innovation and Research and ICI has
confirmed that getting people talking informally
- water-cooler networking - is one of the most
effective ways of unlocking knowledge within
an organisation.
The joint project compared the formal and
informal social networks within large research
and development organisations where the free
exchange of ideas and know-how is crucial.
Dr Naomi Chambers has been appointed as the new head of health policy
and management at Manchester Business School (MBS). She has taken
over from Professor Kieran Walshe who is now on a 12-month study
sabbatical to write up existing research and to embark on new projects
which will focus on his interest in organisational deviance.
Academics from the University of Manchester’s European Work and
Employment Research Centre (EWERC) have helped the European
Commission publish an expert report analysing gender mainstreaming
in practice in the field of employment policies.
On his return, early next year, Kieran will continue his research and to
teach at MBS and will also assume the Directorship of the Institute of
Health Sciences which brings together health research across all faculties
at the University of Manchester.
A leading biotech industry pioneer will be giving
a public lecture at Manchester Business School
on Wednesday 2nd July about his success in
preventing and reducing scarring on the skin
and inside the body.
It presents concrete examples of gender mainstreaming implemented
over the last few years in 30 European countries. The study indicates that
most countries are still far from adopting a full gender mainstreaming
approach to employment policies. In the field of pay and flexicurity
policies, the awareness of gender equality is especially limited. In addition,
gender equality is often not taken into account in the actual design of
policy measures.
http://www.ccsr.ac.uk/
Naomi’s appointment follows the decision to create two new subject area
groups, replacing The Centre for Public Policy Management: innovation in
government and health policy and management – enabling more scope
for specialisation in each field.
The new arrangements also capitalise on the intellectual firepower of the
University of Manchester with both new groups belonging to the Herbert
Simon Institute for Public Policy and Management, the University-wide
research centre hosted by MBS.
.
The conference was opened by the Chinese
Academy of Science’s Professor Rongping Mu,
who spoke about China’s ambitious goal to
become an ‘innovation-driven country’ by 2020.
.
Peter Budd, director of the global engineering
firm, ARUP, outlined the design of the new
Dongtan Eco-city near Shanghai. With capacity
for 80,000 residents, the city is designed to have
a low ecological footprint and will achieve this
through zero emission transport, water
recycling, control of noise and light pollution
and preserving the local bird habitat.
to be an effective knowledge node needs a
particular set of personal characteristics but
coaching and training can increase impact still
further
Scar wars:
the Renovo
story
Naomi said: “Over the next year we are keen to listen and to work closely
with our NHS clients and beyond, to establish programmes that meet the
challenges facing their organisations. There are a number of exciting
initiatives already underway, including the building of an action learning
research and practitioner community at MBS.”
.
A recent conference, hosted by the Business
School’s Manchester Institute of Innovation
Research and The University of Manchester’s
Architecture Research Centre, initiated a
dialogue with China on the crucial issue of
innovation for sustainable growth.
The study has generated five action points
which can easily be put into practice:
informal networks need managing.
Individuals who are key technology ‘nodes’
and those who cross boundaries must be
identified and nurtured. These key people
can help or hinder know-how flow around a
large organisation
Gender mainstreaming MBS health changes
of employment policies
in practice
Professor Jill Rubery, one of the report’s authors, said the manual will be
disseminated by the Commission to all member states to advise them on
how to put gender issues into their employment policies.
.
China currently faces the challenge of translating
economic growth into sustainable development.
At the same time, China is rapidly accumulating
science and technology capabilities and is well
on its way to becoming a key global innovator.
Could this innovative capacity be harnessed to
bring more sustainable development?
“However it’s not always as straightforward as it
seems - especially if an organisation has recently
undergone restructuring, which can sever key
relationships.”
informal social networks matter - coffee room
or water-cooler gossip lubricates the real
business of the firm. Informal contacts help
spread key knowledge within an
organisation. Yet informal contacts are often
ignored when managing organisations
The research also suggests that representation
could involve more community-based representatives, such as those that are based within
local neighbourhoods. There may also
be a case for local councils to focus on their
governance function, based on a relatively
small number of councillors, and to leave
community based representation and governance roles to others.
Dr Purdam concluded that options for change
need to be explored in much more detail, both
in research and practice, as the issue of the
number of elected representatives remains a
neglected area of reform and innovation.
.
Manchester
experts
support
sustainable
growth in
China
Dr Phil Gamlen, senior fellow at Manchester
Business School, said: “Businesses should ask
themselves whether they are maximising the
power of informal networks as an integral part
of their business development strategy.
As co-founder and chief executive of Renovo
and Professor in the Faculty of Life Sciences at
The University of Manchester, Professor Mark
Ferguson leads the largest Biotech company in
the UK. Renovo is the world leader in scar
prevention and reduction research, developing
pharmaceutical products to prevent and reduce
scarring.
Originally a biotechnology company spun out of
The University of Manchester, after raising two
rounds of venture capital funding, the company
was floated on the Main Market of the London
Stock Exchange in April 2006.
it is possible to map networks within firms to
reveal gaps and blocks which may have to be
supported by more formal structures, such as
regular meetings
loss of personnel not only means a loss of
formal know-how, but the organisation also
disproportionately suffers from the collapse
of informal networks which a manager has
built up during their employment.
In total since its foundation, Renovo plc has
raised £99 million. Mark graduated from the
Queens University of Belfast and is a founding
member of the UK Academy of Medical
Sciences.
He was awarded the CBE for services to health
and life sciences by the Queen in 1999.
To book your ticket online visit
http://www.mbs.ac.uk/vitaltopics/2008/
mark-ferguson.aspx
Professor Simon Guy, from Manchester’s
Architecture Research Centre, said wider public
discussion was needed and called for “fresh
thinking about sustainable design beyond the
narrow debates of green architecture, in order
to maximise sustainable growth.”
Other speakers included Manchester Business
School’s Professor Jakob Edler who highlighted
the role public purchasing should play in driving
China towards innovative and sustainable
developments.
Following the conference, Manchester Business
School further strengthened links with the
Chinese Academy of Science by signing a
collaboration agreement to work together on
future innovation research and the exchange
of staff.
Professor Luke Georghiou, director of policy
research at Manchester Business School,
signed the agreement with Professor Rongping
Mu, adding:
“At a time when both the UK and China are
transforming their innovation systems, it’s clear
that working together will strengthen both
research institutes in their study of policy
towards science, technology and innovation.”
Going Dutch?
Recent political debate has indicated that Dutch maternity nurses
could be coming your way. But, is health policy tourism really the
best way to approach many uniquely British health challenges?
By Naomi Chambers
There are, however, pitfalls. There is no doubt
for example that it is easier to transplant
technical and clinical innovations than policy
and management ones: a medicine administered
in Cuba will have the same effect when
administered in the UK, whilst it has proven
impossible to get GPs to provide close personal
care in the same way in England as they do in
Cuba, despite evidence of the clinical and cost
effectiveness of the ‘Cuban way’.
Secondly, there are often deep cultural
differences and historical reasons why health
services have developed in a different way.
The Dutch maternity nurse idea has to be seen
in context. More than 50 per cent of Dutch
women give birth at home in comparison with
rates in the UK that hover around five per cent.
This is unlikely to change significantly, however
much health ministers may ‘want’ it to.
NAOMI CHAMBERS HEAD OF HEALTH
MANAGEMENT AT MANCHESTER BUSINESS SCHOOL
The Conservative Party is to be applauded for
their recent focus on support for mothers, babies
and their families in the first tumultuous week
after birth. NHS maternity services continue to
be the subject of considerable adverse media
publicity; patient surveys also indicate that fifteen
years after ‘Changing Childbirth’ which was
supposed to place the needs of women at the
centre of the service, the experience of women
receiving postnatal care is too often reported as
poor. For whatever reason, there appears to be
an enduring shortage of midwives to provide
the personalised care that is so crucial at this
time. At the start of life, this state of affairs will
only serve to sustain the scandalous gap in
health outcomes between the well off and
disadvantaged groups in our society despite
60 years of a National Health Service.
So we are now invited to adopt the Dutch
model of maternity care and in particular the
use of maternity nurses to provide help and
support in the home for up to six hours a day
for the first week.
It does seem eminently sensible to look elsewhere for solutions. The NHS is building quite a
reputation for doing this and on the face of it
this makes sense. In a global world, most health
systems are facing similar stresses: rising costs,
increased patient expectations, an explosion of
available technology, workforce shortages, more
people living with long term limiting health
conditions and a rise in the elderly population.
Indeed it is refreshing to see for once a Eurpean
rather than a US model of care being invoked.
Thirdly, we find what we are looking for: lessons
learnt are rarely politically neutral as they derive
from the questions that are posed, and out of
problems that may seem to require a quick fix.
Alain de Botton reminds us that we take
ourselves with us when we travel. Drawing
lessons too quickly can lead us to close down
early on the wider range of choices that we may
have. Too often we adopt uncritically ‘bright
ideas’ from elsewhere. The Child Support
Agency is an infamous example of a model
that has worked elsewhere but has proved a
disaster here. A further example can be seen
in community matrons. Although much
appreciated by some patients, community
National Treasure?
Following the publication of the Treasury ‘capability review’,
Colin Talbot asks if confidence in the UK’s economics and finance
ministry has hit rock bottom
matrons originate from a country (the US) with
underdeveloped primary care. Evidence for their
effectiveness in the UK is poor and they have
been somewhat clumsily been grafted on to an
already elaborate primary nursing care system.
This doesn’t mean to say that we shouldn’t
investigate different approaches and policy
options. There has to be international learning,
rather than the ‘not invented here’ syndrome,
when all developed countries face the same set
of challenges. A recent IPPR study indicated that
we could look to the smaller states such as New
Zealand and Denmark who are often at the
cutting edge of reforms. The answer, as Mulgan
has argued, may lie in focussing on whole policy
concepts rather than specific applications. And,
like holding up a mirror, examining other health
services can help us to see our own strengths
and weaknesses more clearly, and help us to
decide what we must hold on to and what we
must change.
Wine often tastes better in the country where
it is produced and when we are on holiday
rather than when we’ve brought it home. Alan
Maynard has used the term ‘policy tourism’.
We could take this one step further: in our quest
for health improvement, perhaps we should
be more like travellers and less like tourists:
operating in a spirit of inquiry and the exploration
of possibilities with an open and critical mind
rather than with a mindset of procuring, taking
or plundering without a second thought.
Stephens also rightly points out that some of
the areas which HMT (and their Chancellor boss)
most often claim credit for are ones where they
have actually given away their powers to others
– most notably over the setting of interest rates
to the Bank of England.
COLIN TALBOT
PROFESSOR OF PUBLIC POLICY AND MANAGEMENT
Is HM Treasury a failing organisation? Certainly
the Treasury mandarins wouldn’t think so, but
others are becoming much more concerned that
the mightiest of Whitehall ministries is losing –
or indeed already lost – the plot.
The influential columnist Philip Stephens,
writing in that doyen of respectability, the
Financial Times (12 Feb), likened HM Treasury
not to a Rolls Royce – the most favoured
metaphor for Whitehall superiority – but to a
Trabant, a dreadful automotive relic of the
former stalinist East Germany.
I could add a few more crimes to the charge
sheet. The worst is the supposed attempt to
introduce a more ‘strategic’ approach to public
finances through the Comprehensive Spending
Reviews – this fell foul of political machinations
almost before the ink was dry on the first one in
1998. First the cycles keep shifting – originally it
was to be a 3 year cycle; then it became a “3
year plan reviewed every 2 years” for the next 3
reviews (2000, 2002, 2004); then it reverted to 3
years (2007); and now no-one knows when the
next one will be. I recently challenged a senior
Treasury official to answer the simple question –
will it be Spending Review 09 or 10? He couldn’t
answer.
Closely linked to this is the attempt to turn HMT
into some sort of central planning ministry
through Public Service Agreements and their
associated targets and the unwarranted
intrusion of what is essentially a finance ministry
into policy areas it should leave well alone
because it simply does not understand them.
And then there is the ludicrous re-introduction
of ‘head-count’ targets as a way of achieving
efficiency – something just about every OECD
government, including ours, abandoned as a
hopelessly blunt instrument in the mid-1990s.
Mercifully, these have now been dropped, again.
Stephens points to a series of blunders in those
areas where the Treasury has retained or
expanded its remit over the past decade – the
half-backed part-privatisation of London
Underground; the continuing disaster of the tax
credits scheme (£1bn a year in overpayment and
fraud); the Northern Rock fiasco; poor
forecasting of the public finances; the nodding
through of the GPs less work for more money
contract; and, last but by no means least, the
loss of 25 million citizens’ details by HMRC, over
which Treasury has taken much greater control.
The list of Treasury failures is matched only by
the arrogance of their “not invented here”
mentality. A couple of years ago I had a
fascinating afternoon with someone on
secondment to HMT. They said they had never
come across such an insular and arrogant
working environment; and as this came from a
very senior management consultant in a very big
consultancy firm - people usually not noted for
their humility – it became an even more
amazing accusation.
It is an impressive indictment, to which can be
added the impressively cack-handed attempts to
tax “non-doms” and ‘simplify’ capital gains tax.
In the face of such hubris, failing organisations
usually need some sort of external shock to
make them face up to their short-comings. Just
such a potential external stimulous was
administered to HMT at the end of last year
when their ‘capability review’ was published.
The product of external scrutiny by peers within
the civil services and external experts, capability
reviews have produced pretty harsh judgements
on many Whitehall departments. The Treasury’s
was no exception.
According to the capability review HMT scored
badly on ‘leadership’, marginally better on
‘delivery’ and a little better still on ‘strategy’, but
none of the assessments were anything to boast
about. The review pointed to some of the
reasons behind high levels of staff turnover –
at middle-management level 50% had less than
three years experience in the Treasury; low
morale – staff believed senior managers didn’t
‘walk the talk’; weak leadership which fails to
drive change with “sufficient pace and
passion”; and so on.
Unfortunately it does not look as if the litany
of failures, or the capability review, has yet
delivered a sufficient shock to provoke real
transformational change in the Treasury. At
the moment it looks more like “a permanently
failing organisation”.
Many commentators – including myself I have
to confess – thought that such an external
shock might come from Gordon Brown once
he moved into No. 10. So far, that has not
happened. That could be for several reasons.
One is that having spent so much time in the
Treasury he’s effectively still enthralled by its
own image of itself. That may be wearing off –
initially he transplanted most of his Treasury top
team into Downing St. Recently he’s recognised
that was a mistake and brought in a fresh set of
top aides. That may provide some necessary
‘reality check’ on views about the Treasury.
But there is a final factor which may cause PM
Brown to hold his hand, even if he does come
to realise the Treasury’s many failings. Despite
recent events, he knows the charge of ‘stalinist
control freak’ is still in the air. Any move which is
seen as an attack on the Treasury might well be
interpreted as centralising power into Downing
St. So maybe the HM Trabant has a bit of road
left yet.
“The global threat from climate
change is now clearer than
ever. The scientific evidence
has hardened. We need to
move from a high carbon to a
low carbon economy, but the
answer is not ‘do not consume’.
It is intelligent consumption.”
Sir Terry Leahy
Chief Executive, Tesco
Planetary gains
If developed countries are to cut their carbon emissions by 80
per cent by 2050 then “the whole economy has to change”
according to Sir Terry Leahy. Ken Green reports on how the Tesco
boss is creating a culture of sustainable consumption
Last September a partnership deal was agreed
between Tesco, the UK-based supermarket
chain, and the University of Manchester to
establish a “Sustainable Consumption Institute”
in the University. The supermarket giant is
investing £25m over five years, probably the
largest contribution ever made by a service
sector company to a European University for
research into sustainability. Tesco’s investment
is part of its strategy to establish a sustainable
model for retailing in a world confronting
climate change and other global issues. As the
Stern Report highlighted, taking a positive,
proactive approach can forge a direct link
between safeguarding the future of the planet
and delivering economic growth. But the work
to identify and develop sustainable practices,
and to encourage their widespread adoption,
needs to move forward at pace.
The vision of the SCI is of a world-leading
research centre addressing major international
issues associated with sustainability in the retail
sector and encouraging consumers to adopt
more sustainable life
The Institute will draw together global
expertise, with specific research programmes
commissioned at Manchester, but also at other
leading world centres. It will be housed in
Manchester Business School but will involve all
the University’s schools in a programme of
research, seminars, conferences, public debates,
policy advice and scholarly and popular
publications. Initially the focus will be on several
research themes, ranging from influencing
customer attitudes, technological innovations
and the development of carbon labelling. All
research from the Centre will be made publicly
available in order that Government, business,
NGO’s and the public may benefit from the
The University of Manchester has a proud track
record in research into the science behind climate
change and research in the social sciences to
understand its economic, social and business
consequences; the SCI is the latest of several
major recent national programmes to have been
awarded to Manchester through competitive
processes in the areas of energy supply and
demand and climate change.
• the ‘Shopping Trolley’ project, commissioned
by DEFRA and published in January 2007 by
Ken Green and Chris Foster of Manchester
Business School, which focused on the
environmental impact of food production and
consumption
SIR TERRY LEAHY CHIEF EXECUTIVE, TESCO
findings. (For the list of themes, see below).
Tesco’s Chief Executive, Sir Terry Leahy, argues
that the Institute demonstrates Tesco’s
commitment to research in this area: “We are
supporting the SCI to bring together experts
from many different areas of environmental
work: climate science, technology, economics
and consumer behaviour. The Centre will help
us to take forward our work on carbon
footprinting and labelling, to identify particular
pressure points in the supply chain, and to guide
our business and our customers towards a lowcarbon future. This is not just private benefit for
Tesco, but for business more widely and for the
public good.”
• A £1M research council award in April, 2007
to develop software for calculating the carbon
footprints of industrial supply chains, including
the food and drink sector
• A research council programme launched in
April 2007 to investigate the accelerating
‘urban heat island’ effect in major cities, linked
to global warming
• Manchester’s 66-strong climate science
research group runs current grants totalling
£5M for research into atmospheric processes
surrounding urban air pollution, clouds,
aerosol, climate change and atmospheric
radiation.
The SCI will become a focal point for the
training of the next generation of researchers,
policy makers and advisors in the public and
private sectors in the area of sustainable
consumption, through an extensive training
programme for postgraduate students.
While new research findings are expected within
the first year of the launch of the Institute, the
nature of the partnership is long-term; it includes
funds to endow a continuing Professorship in
Sustainable Consumption.
Further information on the Institute can be
obtained at:
www.sci.manchester.ac.uk (which includes
details of the Institute’s Doctoral Training
Programme) and from its Research Director,
Professor Ken Green (ken.green@manchester.
ac.uk)
The SCI’s 9 themes:
1)Motivating customers towards greener
lifestyles
2) Carbon labelling
3) Planning a greener future for retail
4) Investing in new technologies
5) Understanding the skills and staffing
challenge
6) Managing the implications of the rising cost
of carbon
7) Waste, recycling and packaging
8) Underpinning Climate Change Research
9) Environmental sustainability
Crisis leadership
If the Northern Rock crisis has taught us anything, it’s that
the danger of complacency is a constant threat in big, complex
organisations. Gill Harvey underlines the perils of ignoring
warning signs and explains the process of turnaround
happen? Are they predictable, and if so, perhaps
preventable? And what actions can be taken to
turnaround organisations that are failing or at
risk of major failure?
“Often major failures develop an
accepted public narrative and it
is only the process of detailed
inquiry or academic investigation
that unpicks and reframes that
narrative, highlighting the
complex (and perhaps
predictable) sequence of events
that culminated in failure.”
GILL HARVEY
SENIOR LECTURER IN HEALTHCARE AND PUBLIC
SECTOR MANAGEMENT, AT MANCHESTER
BUSINESS SCHOOL.
Recent news headlines about the crisis at
Northern Rock and the huge financial losses
incurred by French bank Societe Generale serve
to highlight the major failures that can occur
within organisations. Unfortunately, these recent
incidents are not all that rare - similar examples
within a range of organisations both in the forprofit and not for profit sectors are not hard to
identify. For example, in the finance sector, cases
such as Enron and the collapse of Barings Bank;
in the field of space travel, the explosion of the
space shuttles Challenger and Columbia; in the
retail sector, the troubled fortunes of companies
such as Marks and Spencer; and in healthcare,
examples such as high mortality rates following
paediatric cardiac surgery at Bristol Royal
Infirmary and the wide scale serial killing by GP
Harold Shipman.
Disasters and major performance failure seem
almost a fact of life within organisations in all
sectors of society. But why do such events
Although major failures are often sudden and
unexpected, usually with catastrophic
consequences, subsequent investigations into
the circumstances and causes of failure
frequently reveal the extent of information
within the system that could have been used
to predict or prevent disaster. Prior warning
signals were frequently present in the form
of knowledge, awareness, information and
data within the organisation that was poorly
recognised, acknowledged, interpreted,
understood or acted upon. In some cases,
information may have been actively ignored
or discounted, particularly where the culture
predisposed towards this or where the
organisation clung on to the history of past
success. In other cases, data were too disperse
or poorly organised to enable key decision
makers to make sense of it and act accordingly.
Often major failures develop an accepted public
narrative and it is only the process of detailed
inquiry or academic investigation that unpicks
and reframes that narrative, highlighting the
complex (and perhaps predictable) sequence
of events that culminated in failure.
The collapse of Barings Bank in 1995 with losses
of over £800 million from its Singapore
operations was initially attributed to the actions
of the ‘rogue trader’ Nick Leeson – very similar
to the current debate surrounding events at
Societe Generale. Yet more detailed examination
of the events leading up to the bank’s collapse
revealed that it was perhaps not as unexpected
as initial accounts suggested. Certainly, there
was information available within the bank to
indicate that things were not right in its
Singapore operations long before 1995, yet
the management of the organisation chose
(consciously or unconsciously) not to act on
this information. Academic investigation of the
events leading up to the collapse of Barings
suggest a number of contributory factors were
at play, including management failure to note
or understand the significance of financial
performance information, a ‘success breeds
failure’ syndrome, organisational culture,
structure and strategy deficiencies, the effect
of group think (discounting danger signals and
magnifying good news) and external regulatory
failure.
So if major organisational failures and disasters
share things in common, how can we take this
learning and apply it to the field of performance
management in the public sector? One key
lesson to take on board is the need for
organisational vigilance and awareness. An
important sign of an organisation in trouble is
where a divergence occurs between actual and
perceived performance. Warning signs that
organisations should be looking out for include
a range of both ‘hard’ (quantifiable) and ‘soft’
(qualitative) indicators, the latter providing
particularly important clues about the culture
of the organisation and how well equipped it is
(or not) to respond to the challenge of
performance problems.
Assuming an organisation is exercising
vigilance and actively monitoring data about
performance, what should be done if warning
signs are picked up? The first and most
important thing is to respond to the warning
signs by analysing and interpreting them and
acting appropriately. Despite the temptation to
wait and see, failure to act at an early stage can
exacerbate the problems and increase the
likelihood of wider organisational or service
failure. What sort of actions are required
depends upon the nature and severity of the
problems and the organisation’s ability to
remedy them in order to halt the process of
decline, for example, by revising strategic
objectives or intervening to address financial
concerns.
“Turnarounds do not simply
entail a quick, heroic rescue as
some popular media may lead us
to believe. Typically they involve
a combination of strategies,
often referred to as the 3R’s:
replacement, retrenchment and
renewal”
Where serious decline continues, external
intervention in the shape of a formal turnaround
strategy may be required. Such turnarounds do
not simply entail a quick, heroic rescue as some
popular media may lead us to believe. Typically
they involve a combination of strategies, often
referred to as the 3 R’s: replacement,
retrenchment and renewal. Replacement
strategies, as the term suggests, are concerned
with ensuring the right people are in the right
roles and involve bringing in new managers with
the necessary skills, knowledge and experience
to lead the turnaround process. Retrenchment
focuses on short-term actions to stabilise
processes and systems, whilst renewal activities
are concerned with longer-term goals aimed at
redefining strategic vision, culture and purpose
and moving back towards successful
performance in the future.
So whilst a new Chief Executive or board may
be a necessary part of the turnaround process,
on its own it is unlikely to be sufficient.
Replacement is often the most visible part of
turnaround and serves an important functional
and political purpose, sending key messages
about responsibility for past failure, the need
for change and expectations for improved
performance in the future. However, it has to
be underpinned by medium to longer-term
activities concerned with stabilising and rebuilding organisational performance. This brings
us back to organisations such as Northern Rock
that are currently in the media spotlight.
Northern Rock clearly needs a turnaround
strategy, but there are unlikely to be any quick
fixes. Once a new ownership and leadership
structure is in place, effective turnaround will
involve putting into place a series of short,
medium and longer terms plans to address
operational and strategic problems and build
an organisation that is fit for the future.
Developing a supporting
infrastructure
Julian Bond explains how implementing a long-term vision for
integration can help ensure that patients no longer experience
a disjointed response to their health needs.
(PCT), Community Health & Social Care
Directorate (CHSCD) and frontline workers held
a common vision of integration and that all
were committed to making this work. Some
concern was expressed from frontline staff,
however, that whilst the PCT and CHSCD had
a vision for integrated teams, the working
through of that reality had been left to the pilot.
They needed to forge their own understanding
of integrated care and resolve contentious
issues arising from it. This suggested that more
effective communication from management of
what constituted the short, medium and long
term vision for integration may have helped to
resolve problems more rapidly by setting clear
boundaries about what could be expected.
JULIAN BOND SENIOR FELLOW IN HEALTHCARE
AND PUBLIC SECTOR MANAGEMENT
The Government’s 2006 White paper Our Health,
Our Care, Our Say made clear that developing
improved mechanisms for joined up work
between health and social care was an important
objective of the Department of Health. In
January 2007, we were subsequently asked by
Salford City Council and Salford PCT to
undertake a two stage piece of research with a
pilot Integrated Health and Social Care team
designed to improve the fit of services with users.
Our initial research indicated that substantial
progress had been made towards delivering a
more holistic approach to health and social care
for service users. The pilot integrated care team
had worked hard to ensure that integration was
embedded in their practice and a strong
commitment to joint working was evident. The
co-location and proximity of health and social
care staff was central to the development and
deepening of informal and formal learning and
networking across the professions. A key
outcome was an increase in knowledge transfer
between nursing and social work staff and
improvements in interventions. There was some
friction over the demarcation of professional
boundaries and the question of appropriate
activity for different member of staff relating to
inter-professional working, but staff had worked
hard to resolve these issues within the team.
Evidence suggested that the Primary Care Trust
The principal barriers faced by the Salford pilot
to better joint working were reported as mainly
practical constraints. Speed of implementation
created difficulties linked to accommodation, IT
infrastructure and training. The majority of the
IT and infrastructure issues were resolved within
a short period of time. In addition, the training
received by staff was felt to have not met their
needs. It lacked focus on developing a team
ethos, setting out new expectations and ways
of working, and how problems relating to
integration and cross professional working
might be addressed. The timing of the training
was also unsatisfactory, taking place during the
most intense period of organisational change
as the new team was launched. Similarly, there
was a lack of follow up ‘whole team’ training
and it was this experience that the second stage
of the research sought to address.
The approach comprised of three main strands:
The first was to develop a cohort of staff, at team
leader level, who would be leading the change
across the City. It was envisaged that by
developing a critical mass of people at that level
they would keep up the impetus of integration
whilst providing support for each other. The
interventions were designed to
• Give staff the opportunity to network and
team build
• Give the opportunity to share ideas and best
practice in order to improve outcomes for
patients and service users
• Understand the issues around integration
• Develop personal skills, knowledge and
confidence around managing organisations
The content of the workshops was a mixture of
both theoretical and practical and comprised of:
• Myers Briggs Type Indicator to help them
understand both themselves and the people
they were managing.
Management and Leadership Programmes 2008
As you would expect from a world-class university, we pride ourselves on
offering programmes which combine academic rigour with a high degree
of relevance to the real-world challenges faced by public sector managers.
We aim to support and contribute to the improvement of public services
through capacity and capability building for individuals, teams, organizations
and sectors.
Developments in EU Health Policy and Cross-Border Care
This is an informal and interactive workshop led by Dr Naomi
Chambers, Head of Health Policy and Management at MBS. Alongside
colleagues from EHMA, we’ll examine the implications of allowing
patients to choose to receive their health care in other countries within
the EU. We’ll help you to understand the impact of EU health policy on
providers and commissioners in the UK NHS and to work through the
opportunities for and threats posed by cross-border healthcare for
both patients and NHS providers. You’ll also examine the potential for
cross country collaboration.
September 2008
For further information contact Maggie Toomey on 0161 275 6475
[email protected]
Network for Secretaries to NHS boards
• Understanding and creating organisational
vision, exploring different models and concepts
and translating that vision into team outcomes.
• Understanding and managing effective and
sustainable change through the application of
different models on their real life work issues,
exploring the thinking around organisational
culture and how this can block change and
learning about resistance and developing
mechanisms to overcome it.
• Working through the concepts of leadership
and management, understanding the
differences and similarities and knowing
which to apply in any given situation.
The second strand, which ran in parallel to the
development, comprised of Action Learning
Sets. These sets were organised to support
teams who had become integrated and those
preparing for it. They would give staff the
opportunity to work through problems and
issues they were facing, provide a forum to
share success and experiences, continue to build
relationships across health and social care and
assist others on the same journey. I also offered
a safe space for people to reflect and step out of
chaos.
The third strand, which is being systematically
rolled out across the city on a team by team
approach, comprises of four half day development session for the team just prior to their
integration / co-location. These sessions are for
the whole team, to aid the forming, norming
and performing process which helps develop a
team ethos to explore and understand the
culture, values and attitudes of health and social
care. Out of this, the best elements from both
can merge to develop a unique, effective,
integrated Salford culture.
This popular network, facilitated by Dr Lawrence Benson,addresses
some of the most topical and controversial issues and is a means of
sharing knowledge in a mutually supportive environment. Boards of
PCTs/NHS Trusts, Foundation Trusts and Strategic Health Authorities
are responsible for setting the strategic direction of their organisation,
for the way their business is organised and to ensure that financial
targets are achieved. The Secretaries to the Board have the difficult
task of keeping track of these responsibilities and this network provide
the opportunity to share good practice and discuss challenges. Topics
for this event include the reality of working with a Foundation Trust
from the PCTs point of view and managing the separation of roles
within PCTs.
21 May 2008
For further information contact Emma Farnworth 0161 275 2927
[email protected]
Management Development Programme for Specialist Registrars
Specialist registrars face a range of pressures in their final appointment
before consultant status. They are required to develop expertise in
clinical governance, risk management, and teamworking and to
understand government policy, NHS organisational structures, decisionmaking processes and medico-legal issues. The programme runs for 5
days and reflects nationally recognised training needs at this level.
Three key areas are covered – the external environment in which the
consultant works and manages the service; the interactions and
dynamics between the consultant and others in the organisations; and
understanding and managing yourself.
30 June – 4 July 2008
For further information contact Emma Farnworth 0161 275 2927
[email protected]
NHS Confederation Conference and Exhibition
This year’s conference and exhibition is taking place at Manchester
Central from 18 – 20 June and Manchester Business School will be
there. Please come and see our health policy and management experts
at stand C28 where we’ll be happy to discuss any of your current
management and leadership challenges.
The Programme for High Value Managers
The programme for High Value Managers is the result of a pioneering
project at Manchester Business School - to develop a programme for
experienced managers who are looking for a practical and shorter
alternative to an MBA. Developed after discussions with over 40
companies, it is a business school programme for managers who want
the best of an MBA without the added pressure of assignments and
assessed work. The programme is designed for high value managers
who need to get to grips with the latest thinking on business and
management in order to contribute as fully as they can in their present
or prospective roles. It is ideal for experienced managers who have
been identified in succession plans to move into key jobs and who
need practical preparation for these roles. These may be managers
who are about to lead project teams, functions or business units or
who are being developed for senior general management positions.
The programme is also valuable for managers who need to challenge
their company-specific knowledge and maximise their potential by
engaging with managers and management practice from a range of
business sectors. You’ll gain a practical understanding of strategy,
finance and marketing, improve your facilitation skills for leading and
managing and leave with a greater awareness of your management
style and effective behaviours.
Week 1 15 – 19 September 2008
Week 2 3 – 7 November 2008
For further information contact Joanne Cherry 0161 275 6403
[email protected]
Appreciative Inquiry for Change Leaders
Appreciative Inquiry offers a credible approach to generating whole
system change, engagement and sustainable growth for organisations.
This innovative programme is led by Dr Ann Shacklady Smith. It offers
change leaders the knowledge and practical skills to implement
Appreciative Inquiry at a time when there is an increased emphasis in
the public sector for engagement with the community, for outward
looking organisational development, and for responsiveness to
consumer choice. Stakeholder teams who are involved in a large scale
project will benefit from attending this programme together.
Autumn 2008
For further information contact Steph Mullen 0161 275 2910
[email protected]
Tailored programmes
The Centre also offers individually designed executive development
programmes tailored to a client’s specific requirements. These can
range from one day update courses to long-term strategic
partnerships, delivered on the client’s own premises, at Manchester
Business School or elsewhere. Excellence in teaching and resources,
developing a true understanding of your needs, and a commitment
to exceeding expectations are key to the success of our tailored
programmes. Recently commissioned programmes include Leadership
Development, Effective Commissioning, New Approaches to
Managing Long-Term Condition and Board Development.
For further information contact Steph Mullen 0161 275 2910
[email protected]
We are constantly developing new programmes – check for details on our
website http://www.mbs.ac.uk/executive