News and Comment

25th anniversary guest blog series: Glasnost and Realism

Thursday 30 October 2014

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Since its establishment in 1989 OPM has made an invaluable contribution to stakeholder engagement, organisational development, leadership development and coaching across the UK’s public services. OPM’s 25th anniversary is a great excuse to reflect on what we have learned about public services in the UK, whether delivered in house or on an outsourced basis, since 1989. It is also a chance to pause to think about the challenges and opportunities facing those services over the next five years or so.

Since 1989 glasnost has well and truly broken out in debates about the provision of public services with most of the old, tired taboos having gone. Very few now cling on to the delusion that our public services are universally exceptional and the envy of the world. That view, still prominent in the late 1980s, perpetuated the pernicious idea that somehow the business models behind our public services should be treated like museum artefacts, there to be preserved, revered. Nothing closes minds to radically positive reform of service design and delivery more powerfully than a paradigm of reverence.

Thankfully it is now acceptable for our public service purchasing, delivery and the achievement of outcomes to be described more accurately. They are a deeply worrying mixture of frequent brilliance and regular ineptitude. Citizens recognise that many of our public service organisations remain a very long way from the modern, hugely productive, highly communicative, customer centric, financially innovative organisations they should be. Consequently, debates about the need for continuous improvement are now more enlightened. There is an acceptance that our public services need to be constantly agile with a relentless appetite for positive change. 25 years on from the creation of OPM the paradigm of honest realism is the dominant one.

During this shift of paradigms so much has been learned about how best to nurture the passion, dedication and enthusiasm of public service workforces. The challenge and opportunity over the next five years or so is to embrace the three most important pieces of this learning.

Firstly we all know better than ever now that it is literally pointless restructuring public service purchasing and delivery if there is not a simultaneous major injection of new talent and the removal of poor performers. Even a cursory look at the recycling of former Primary Care Trust staff into Clinical Commissioning Groups and so on in the health economy, for example, shines a light on the perils of creating new bodies mainly staffed by those who were in the predecessor organisations. We have learned over and over again in these 25 years the futility of expecting new and restructured public services that are dominated by the staff of their predecessors to implement the type of strategic, commercial and financial grip that has become the norm in many other parts of the economy.

Secondly we have all learned that cash is an inadequate and often inaccurate indicator of resource requirements for public services. Very few of our public service purchasers or deliverers can accurately measure, manage and/or forecast unit costs and productivity across large parts of their businesses. So it is not surprising that many of them cling to the notion that more money is a certain route to improvement and their ability to cope with demand and increased expectations. Thankfully the last 25 years have provided some wonderfully helpful examples of public services improving in terms of delivery and outcomes whilst the amounts of cash funding for those services has reduced. We have also seen many services given massive real terms increases in cash but simultaneously reduce their performance. As a result it is slowly becoming socially unacceptable for public service purchasers and providers to bemoan their cash constraints whilst presiding over organisations with very low levels of productivity, poor skills, little commercial acumen, weak management and a lack of innovation. But the challenge of avoiding a reversion to the tired old debates that focus solely on funding remains real.

Thirdly, despite the protestations of some, ownership matters. Since 1989 we have seen a healthy diversification of models for designing and delivering public services. Employee ownership has been and remains at the heart of this agenda. Employee owned organisations, many of which have spun out of the public sector, now deliver public services worth £2bn each year in the UK. Employee owned businesses always deliver better service quality, better service outcomes and better value for money for public sector purchasers who award service delivery contracts. Employee ownership in public service delivery is, therefore, very much part of the UK’s new economy. The challenge now is to rapidly expand employee ownership into new service domains including the publically funded acute health care sector.

So, 25 years on from the arrival of OPM debates about public services have moved on significantly. A number of key lessons have been learned over that time. If our attitudes and behaviours embrace the most important aspects of this learning, the future of UK public services will be bright. If we do not, we will look back in anger at missed opportunities.

Iain Hasdell is Chief Executive of the Employee Ownership Association

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About the series

OPM is celebrating its 25th anniversary this year, and as a public interest organisation, we’ve always contributed to the debate about the future of public services.

With this and the next general election in mind, we’ve asked a number of senior thinkers to give their views on the challenges and opportunities facing public services and society in the near future.

This is one of a series of guest blogs, which we’ll be adding to in the coming weeks and months. To read previous posts in the series, go to our news and comment page.