The lights dimmed. The buzz in the auditorium quietened to a hush.
With an almost imperceptible nod from the first violinist, the allegro begins.
Two violins, a viola, a cello and Mozart’s String Quartet No.1 in G major. He was thirteen when he wrote it. Have a listen.
A concert hall where the acoustics are ‘pin-drop’ good. Mellow instruments even older than me. Musicians with talents that have been coaxed since they were as young as Mozart.
Prodigies at the top of their profession with better instruments than were around in the late 1700’s, when the music was written. It doesn’t get any better.
But… it still takes two violins, a viola and a cello to play it.
Over more than three hundred years it hasn’t got any better. It’s not finished quicker. It sounds the same.
Still takes four people but each year the players get paid more money to play it. Even though there’s no improvement in productivity
As bonkers as this might sound, it is the basis of an economic theory. An effect known as Baumol’s cost disease.
Baumol explains why the cost of services tend to rise over time, even when productivity improvements are made in other sectors. He came up with the idea in the 1960’s.
William Baumol’s phenomenon, as the economic’s book tell us;
‘… [He]… observed that certain sectors of the economy, such as the performing arts, education, and healthcare, tend to have slow productivity growth because they rely heavily on human labour, which cannot be easily replaced by machines or automation.
As a result, the wages of workers in these sectors tend to rise over time to keep pace with the wages of workers in more productive sectors.’
… except, of course, as we know from the strikes and argy-bargy, NHS wages haven’t kept pace with other sectors.
NHS pay lost traction during the austerity years. Trades Unions failed to spot the slippage and by the time they did, were not militant enough, bold enough, organised enough to make a difference.
Now claims for pay-restoration are impossible to meet. The nurses look like settling for below inflation. We wait to see if the junior doctors fare any better.
The damage is done.
In fact, in terms of running the NHS things have got worse. The NHS has faced cost pressures from rising utility prices, equipment, pharmaceuticals, facillities, repairs, renewals, capital costs… everything costing more.
As NHS’ revenues are capped it can’t offset rising costs.
It would be wrong to say the NHS is not productive. Since 2010, productivity growth has been higher in the health care sector than in the whole economy.
Growing at an average annual rate of 1.7%, compared to 0.5% for the rest.
The problem; economic growth has been poor, so it’s not a great comparator and the NHS is swamped with demand. The productivity effort, not enough to keep up.
What the NHS calls targets, really proxy productivity indicators, are being missed.
There are rota gaps and insufferable working conditions.
We are short of nearly 125,000 people with no real prospect of recruiting anywhere near the numbers we need.
Brexit saw 15% of staff leave and now we are dragging 13% from halfway around the world, to work here and make up the difference.
Productivity?
We need more than that. We must think ‘easier’. Make the work easier and it will be more productive.
• Dumping manual processes, streamline administration.
• Digital first, reducing the need and cost of physical infrastructure
• Develop people, invest in training, extending skills and knowledge
• Deploy the right people to the right place at the right time, avoiding…
• Duplication
This looks easy but it’s complicated. This maybe obvious but you have to get into the detail.
Mozart said; ‘The music is not in the notes, but in the silence between’.
Management is not always about the work; it is in the space between the work; the gaps, the waits, the delays, duplication, the queues, the interfaces and inefficiencies.
The places where thoughtful reflection and innovative management is to be found.
News and Comment from Roy Lilley
Contact Roy – please use this e-address roy.lilley@nhsmanagers.net
Reproduced at QuickStepHR by kind permission of Roy Lilley.