NHS IT – faster procurement is not always better procurement

The Times last week published more detail around the disastrous UK NHS IT programme. The main thrust – and the only really new information – was around the additional revenues that CSC, the US IT firm and one of the main providers to the programme, expect to make from the scheme. Apparently there may be lock-in to some software maintenance fees that will cost health organisations dearly over the next years.

I felt much of the criticism of CSC was misjudged. By all means have a go at any firm based on non-performing products, but if any supplier has a contractual right to revenues, it seems naive to expect them to do anything other than pursue them.

The Times was also critical of the contracts themselves, quite rightly. The whole programme has been a disastrous waste of money, costing the taxpayer over £10 billion with very little to show for it. A case for a public enquiry?

Dr Gordon Murray has again (and I’m beginning to sound repetitive here) written a very good piece on his blog about the issue. He’s also made some very pertinent points about the Gateway process – why did it not pick up the problems as we moved through the process? Or perhaps it did but the Department of Health pressed on regardless?

But we’re interested in another angle. Let’s take a few of the points that learned commentators on public sector procurement (Francis Maude, Sir Philip Green, Lord Sugar) have been making and look at them with respect to the NHS IT programme.

1. “We need private sector skills in the public sector, get the best people and pay them more”. Richard Granger – ex Partner from Deloitte, and along with Tony Blair and a couple of Ministers, one of the most culpable individuals here  – ran the procurement. And was very well paid by public sector standards, £280K per year, I believe. Ken Anderson, ex private sector also, was DH Commercial Director for a key period during the programme.  That didn’t seem to work out too well.

2. “We need faster procurement – lean procurement in 120 days is the goal”.  Granger boasted about how quickly the procurement was delivered. It’s clear in retrospect that was achieved because no-one bothered getting stakeholder buy-in or even much input, and there was no clarity about what was actually to be delivered.

3. “Engage suppliers before you start the process”. I don’t know if this happened but one suspects that the likes of Accenture and BT told Grainger that buying a bespoke solution to be developed and run by a few mega-prime contractors (like Accenture and BT) was a jolly good idea.

4. “Make suppliers take on risk in major projects”. These contracts were constructed with “suppliers taking on delivery risk”. However, it doesn’t  seem to have quite worked out like that – and of course, if suppliers don’t deliver, it is the politicians, officials, patients and taxpayers who ultimately suffer.

We’re not saying for a moment that (for instance) the Cabinet Office lean procurement drive isn’t a sensible initiative. But let’s just remember there’s  always another side to the story. The haste with which the NHS IT contracts were let was a major factor in this unmitigated disaster.

This programme has also demonstrated why observers need to take what is said by the great and the good (politicians, civil servants, consultants) with a pinch of salt.  Many important people at various times expressed great confidence in this scheme and said the programme would all work out fine. Optimism or deliberate deceit? We’ll never know, but next time you hear that everything is going well with a major project, despite what Private Eye is reporting, just remember NHS IT. Believe Private Eye.

Voices (3)

  1. Final Furlong:

    The Commercial Strategy for Connecting for Health was articulated very clearly by Richard Granger, at the Public Accounts Committee and at the numerous conferences he attended where he applauded the outcomes that would be delivered by his own programme.

    Granger likened his commercial strategy and approach to supplier management to “huskies pulling a sled”. When one becomes weak or injured, it is simply shot, chopped up and fed to the others to sustain them along the journey. (I recall the members of the PAC looking quite stunned at this strategy.)

    The flaw, of course is that, as we all know, the lead dogs are always the smartest (reiterated on BBC’s amazing ‘Frozen Planet’, no less). And one of the original lead dogs pulling the Connecting for Health sled was so smart, it dug in its heels, stopped the entire sled, freed itself, took a bite out of all the other dogs, and while walking alongside the sled, squeezed out a ‘steamer’ so big that all the passengers could smell it a mile down the road.

    Finally, many of the other dogs became tired of waiting for their reward “for being good dogs” and so fell by the wayside and were subsequently chopped up. One of the remaining large dogs, of course, simply became very fat from picking up all these scraps. Needless to say, to help it, the Department of Health lightened the load on the sled to make it easier for them to pull the sled.

    And so here we are today, in awe of the forward thinking commercial strategy that Granger had devised. Nobody has heard of him since. Perhaps he moved to the North Pole…

  2. Flying Finn:

    It would also be interesting to know whether the Department of Health remained within the specification which they contracted. It does seem that too many times contract variations start before the signatures are dry on the contract. Perhaps the result of hasty procurement or lack of stakeholder engagement – either way, variations are costly. For all parties.

    1. Plan Bee:

      They certainly did not. The major issue that Accenture, Fujitsu and others had was the negotiation for the contract reset ( to align it to the new specification)

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