Improving board effectiveness

Objective setting, performance review, appraisal and CPD for board members (Source Setting the Direction – A Board Member’s Guide – NLIAH/ WAG Publication, Edition 407/06)

The process within the NHS in Wales for independent members’ performance appraisal and review is under development, but is likely to be built on the following:

Objective Setting

Every board member of an NHS board must agree personal performance objectives with their chair and for executives with their chief executive.

Although the process of managing the performance of an individual board member may vary and also involve a separate “home” organisation to whom they also report, the principles for performance management can be established from the following components:

1.The Chair’s general expectations of all board members:

It is usually helpful if the Chair lays out their general expectations of all board members for example to:

  • complete their induction/re-induction to health and social care in Wales, always come to board meetings properly prepared, briefed, having read their papers and to contribute effectively,
  • observe the Code of Conduct, and comply with standing orders and standing financial instructions,
  • adopt the behaviour protocol for public meetings.

2.Specific objectives for individuals arising from the operation of the board:

These objectives arise from what needs to be done to operate the board and its committees and subcommittees. So, for example, objectives might be set for an individual to chair or be a member of a subcommittee and, within that, set evidence based objectives, for example to:

  • a) assess and report on quality and safety,
  • b) report on senior management effectiveness,
  • c) measure compliance with equality and diversity requirements.

3.Specific objectives for individuals arising from the work of the organisation:

As the vision, the board’s work programme and the organisation’s action plans become clearer, it may become helpful to ask individual board members, without losing their strategic perspective, to:

  • assess and report on the two way communication and overall engagement with citizens and the community,
  • measure and report on progress and/or performance of a particular project or part of the organisation's action plan by a specified date,
  • contribute by participating in a task and finish group over a specified time to deliver particular outcomes.

Performance Review and Appraisal

Arrangements are currently being developed by the Assembly for board members. The details set out here reflect the current system, but will give independent members an indication of the possible shape and characteristics of performance review and appraisal. It is also important to note that any performance appraisal activity undertaken by the chair of the LHB/Trust will be carried out on behalf of the Minister.

Performance review and development processes usually include a formal review and report at least once a year.

Chairs will normally give feedback to individual board members as the year progresses. So for instance:

  • If an individual performs particularly well or poorly during board activities they may be spoken to and given some feedback following the event.
  • An informal mid-year review discussion may be arranged.

Chairs and board members also need to participate in more structured reviews:

  • Self Assessment: As the year progresses, each board member should be expected to review their own performance and keep a portfolio of evidence detailing how they are addressing their accountabilities and the objectives they have agreed with their Chair.
  • Annual Review of Performance: At the end of each year, the individual’s portfolio of evidence should be passed to the Chair for review. Using this, the chairs, with input from the chief executive as appropriate, will then prepare their comments for inclusion in the individual’s portfolio. The annual appraisal session for the board member can then be used to discuss their performance and identify areas for development.

Continuing Professional Development (CPD) Plan

In the portfolio, board members will also be asked to write up their personal development plan and CPD priorities for sign off by the Chair and/or chief executive.

Building the performance of the board

It is important for all who serve on boards to recognise that part of their job is to evolve their effectiveness and impact over time. Because of the size and complexity of health and social care organisations, it is not possible to have everybody who needs to serve on the board join as a fully fledged, experienced and skilled board member. Nor is it reasonable, given the importance of the work of the organisation and its significance to the people it serves, that boards do not strive with some urgency to evolve their abilities as far as possible in their lifetime and that of their organisation.

The main work of the board is to provide a clear strategic framework or vision to guide the development of the organisation in line with the assembly’s wider goals and policies.

Professional Problem Solving

Effectively the board needs to become a group of professional problem solvers who involve the right people and use the right techniques to:

  • be clear from the start as to the bigger picture and local measureable outcomes and objectives that need to be achieved,
  • get a clear and correct idea of what the current situation is,
  • rigorously analyse the root causes of problems and identify the real key issues that need to be addressed,
  • create imaginative options that definitely address the root causes and key issues,
  • skilfully use the right tools to select the best option or combination of options,
  • make sure a detailed implementation plan is prepared through the involvement of all affected,
  • check that implementation is completed as intended and modified to take account of new issues that have emerged,
  • review at the end to ensure that intended outcomes have in fact been delivered and that the logical next steps and follow through have been put in place to make the absolute best use of the new arrangements.

To do this well, the board needs to learn and use the range of logical analysis, critical thinking and personal skills appropriate for the task.

The crucial importance of vision

As is emphasised throughout this guide, it is vital that the board articulates a really clear picture of what they want the future to look like in as much detail as possible. This is not only restricted to being just about the shape and style of the organisation, but also about what is happening in the outer world and how the organisation’s facilities and services are interacting with those of partner organisations and, perhaps most importantly, the impact this has on the behaviour and health of patients and the ease with which they can access and use services when they need them.

The vision once agreed and fully articulated is the reference point against which present and proposed performance is measured. So we can ask questions like: How far have we got towards delivery so far? What else needs to be done to get us the rest of the way as easily, effectively and quickly as possible? Board visioning in all organisations tends to go through three distinct phases:

  1. Initial Visioning: Initially, a broad statement of intent that feels right and then, latterly a more detailed statement based on a much more thought through approach that takes account of what exists or is missing at present and locality health needs.
  2. Scenario Modelled: This second level of visioning requires the board to begin to be able to look at the overall picture using some kind of scenario modelling tool. In an environment as complex as health and social care it is not reasonable to expect board members to be able to see the overall picture from a myriad of board papers alone. Some kind of physical or computer aided modelling tool will be needed to provide a pictorial representation of what is happening. Once the model is built, different scenarios can be laid out on the model to see what effects and consequences can be created with different service and facility scenarios.
  3. Deliberately Designed and Tested: Once what appear to be successful scenarios have been identified on the model they then need to be fully worked up, rigorously tested and benchmarked to check as far as possible that they will work well in practice. There are a whole battery of tools and techniques that have application in this phase.

Developing the board’s knowledge and skills – trainings/briefings

Being on a board in the health and social care arena requires board members individually and collectively to have a very wide knowledge base in order for them to be effective. Health and social care is intentionally undertaking significant development and investment in order to create better health, better quality of service and less health inequalities.

Health and social care by its nature requires organisations from local government, health, the third sector, private sector providers, patients, staff and the public to collaborate to deliver the results required. Health and social care is constantly changing, so staying up to date is a significant task for boards and board members.

Effective Induction

When board members first join a board it is vital that they complete a thorough induction process. Failure to do this might mean they are not able to be effective for months or even at all if they don’t understand enough. Many chairs check to see that new board members are up to speed and able to contribute at one, three, six and 12 month intervals in the first year. The pace of change doesn’t allow for much downtime, new board members need to get in role as quickly as possible so that they can keep up with the continuous stream of update materials.

Statutory Mandatory Training

An important part of induction is the completion of the training relating to statutory duties the organisation, the board and board members do or may hold. Even the work of some sub committees is bounded by important codes of practice and statutes. It is good practice to keep documentary evidence that this training has been sufficiently completed and that participants have evidenced their competence in some way.

Policy Updates

In this fast moving and wide ranging environment, policy updates, additions and guidance come in at regular intervals. It is important that board members are cognisant of the latest rather than out of date policy positions. Briefing sheets, policy documents and, for larger pieces, presentations and training may need to be arranged for board members. Some organisations operate a documentation control system that requires board members to sign to say that they have received and read important documentation. New policy and guidance may have important contributions to or effects on the organisation’s own vision and strategy. It is vital that board members are able to identify this and ensure the necessary action is taken.

Implementation Plans and Activities

Many previous board members have reported how hard they find it to understand what is happening and what plans actually mean when they only receive papers at board meetings. Complex pieces of work and board papers need to be supported by well structured, properly prepared educational presentations that enable maximum understanding by the board so that they can ask relevant questions and make decisions in the light of good understanding. Even financial plans and budgets can really benefit from good data display techniques and presentations.

Many board members have also found that it helps to go out into the organisation or the service environment or the community to actually see what they are talking about and chat to people involved. This gives them much better grounded insight – it also enables them to see for themselves to what extent the board’s values and the organisation’s vision is being made a reality.

Progress and Performance Review

The last area where knowledge based training may be important is in the area of progress and performance review. It can be difficult for board members to get a good grasp of what is actually happening and to understand the nature and meaning of the information they are looking at.

Training can usefully be completed to enable board members to understand what information is available and the various formats including graphical and pictorial representations that can be used to present it. This enables the board to begin to select information they want to see and let go of information they don’t need to see. This often results in less work for executives overall – often a significant benefit in its own right!

Performance Management

  • How is your organisation performing?
  • How are your local health and social care economy partners performing?
  • Which are the priority areas of performance that you need to improve?
  • Is your organisation improving its performance?
  • How will you ensure standards of accountability, regularity and propriety are maintained?

All health and social care organisations have a dual role – to deliver both national and local priorities and targets.

Benchmarking

To find out how your organisation’s performance compares with others, you should seek benchmarking data. Benchmarking is important in helping you identify where your performance is different and for questioning why. You should use such information to constructively challenge your executive directors on the performance of your organisation. Without such information, it is extremely difficult to assess the performance of your organisation and to effectively challenge the performance of your directors and services.

Ensuring that key performance indicators, or critical success factors, have been identified and are regularly monitored is important because this information will help you to understand how your organisation is performing and where action is needed to improve performance. Key indicators may include:

  • how long the public has to wait to see a general practitioner (GP), consultant or other professional
  • how much your organisation spends on management or individual services
  • illness/disease, mortality, birth and immunisation rates
  • what patients and staff say about services
  • financial performance (keeping the costs of services within budget)
  • staff sickness absence and turnover rates.

Information

  • Do you receive sufficient, timely, robust and accurate performance information?
  • What information do you really need?

As a board member, you have limited time available to perform all your roles and responsibilities. It is, therefore, crucial that the information you receive covering the key areas of the organisation’s work, is kept to a manageable level, but is comprehensive and easily understood. Typically, you will receive regular reports at the board on the financial and clinical performance of your organisation, but this information can be difficult to assimilate and understand. You will also receive a significant amount of information from outside sources and many board members complain about information overload. So you need to be proactive in getting the information you want, in the format you want, when you want it.

The challenge is to select, from the hundreds of statistics produced in the organisation, those that are relevant, and to identify what additional information is required. This can be tackled in at least two ways:

  • Starting from scratch and requiring executive directors to produce tailor-made performance information.
  • Sifting the information that is currently produced for monitoring progress

The end result should be a schedule of performance reports that the board wishes to see. This decision should be made by the full board, not by executive directors. It may be more useful to implement exception reporting only for some indicators.

Financial Information

Getting to grips with the finances of an NHS organisation can be daunting, but failing to do so puts you at risk of marginalisation during decision making. There is no model format for a financial report, but those that are accessible have five hallmarks:

  • Summaries of finances and activity reported together.
  • There is a short written explanation.
  • Projections are included.
  • Comparisons are made.
  • A summary is provided - detail is available.

Information Governance

Information Governance is the way organisations handle information. In the NHS, this is particularly in relation to the personal and sensitive information of patients and employees. It allows organisations and individuals to ensure that personal information is dealt with legally, securely, efficiently and effectively, in order to deliver the best possible care.

It provides a framework for bringing together the requirements, standards and best practice that apply to the handling of information. It has four fundamental aims:

  • To support the provision of high quality care by promoting the effective and appropriate use of information.
  • To encourage responsible staff to work closely together, preventing duplication of effort and enabling more efficient use of resources.
  • To develop support arrangements and provide staff with appropriate tools and support to enable them to discharge their responsibilities to consistently high standards.
  • To enable organisations to understand their own performance and manage improvement in a systematic and effective way.

Information frameworks need to encompass:

  • Data Protection Act 1998
  • Freedom of Information Act 2000
  • A Confidentiality Code of Practice
  • Records Management
  • Information Quality Assurance
  • Information Security
  • Information Governance Management

What is a learning organisation?

Researcher and writer Barbara J. Braham has said that: "A learning organisation is an organisation that prioritises learning."

She maintains that a Learning Organisation is set apart from other organisations in seven distinct ways:

  1. Learning is integrated into everything people do; it's a regular part of the job, not something extra you "add on".
  2. Learning is a process, not an event.
  3. Cooperation is the foundation of all relationships.
  4. Individuals themselves evolve and grow, and in the process transform the organisation.
  5. The learning organisation is creative; individuals co-create the organisation. The organisation learns from itself; employees teach the organisation about efficiency; quality improvement and innovation.
  6. It is fun and exciting to be part of a learning organisation.

Wikipedia points out that there are varying definitions of a learning organisation in published literature, although the core concept between them all remains clear and has been summarised by Pedler et al as, “an organisation that facilitates the learning of all its members and continuously transforms itself". Pedler et al later redefined this concept to “an organisation that facilitates the learning of all its members and consciously transforms itself and its context”, reflecting the fact that change should not happen just for the sake of change, but should be well thought out. Some definitions are broader and encompass all kinds of organisational change rather than just change through learning, whereas others include specifics about how a learning organisation works. Senge defines learning organisations as: “Organisations where people continually expand their capacity to create the results they truly desire, where new and expansive patterns of thinking are nurtured, where collective aspiration is set free, and where people are continually learning to learn together.”

Why do learning organisations develop?

Organisations do not organically develop into learning organisations; there are usually factors prompting their change. It has been found that as organisations grow, they lose their natural capacity to learn as company structures and individual thinking becomes rigid. When problems arise in the company, the solutions that are proposed often turn out to be only short term (single loop learning) and re-emerge in the future. To remain competitive, many organisations have restructured, which has resulted in fewer people in the company. This means those who remain need to work more effectively. To create a competitive advantage, companies need to be able to learn faster than their competitors and also develop a customer responsive culture. Argyris identified that in light of these pressures, modern organisations need to maintain knowledge about new products and processes, understand what is happening in the outside environment and produce creative using the knowledge and skills of all employed within the organisation. This requires co-operation between individuals and groups, free and reliable communication, and a culture of trust. These needs can be met through embracing the tenets of the learning organisation.

Benefits of being a Learning Organisation

There are many benefits to improving learning capacity and knowledge sharing within an organisation. The main benefits are;

  • maintaining levels of innovation and remaining competitive,
  • being better placed to respond to external pressures,
  • having the knowledge to better link resources to customer needs,
  • improving quality of outputs at all levels,
  • improving corporate image by becoming more people orientated,
  • increasing the pace of change within the organisation.

Characteristics of a Learning Organisation

A learning organisation exhibits five main characteristics: systems thinking, personal mastery, mental models, a shared vision and team learning.

Systems thinking

The idea of the learning organisation originally developed from a body of work called systems thinking. This is a conceptual framework that allows people to study businesses as bounded objects. Learning organisations employ this method of thinking when assessing their company and will have developed information systems that measure the performance of the organisation as a whole and of its various components. Systems thinking also states that all the characteristics listed must be apparent at once in an organisation for it to be a learning organisation. If one or more of these characteristics is missing then the organisation will fall short of its goal. However, O’Keeffee believes that the characteristics of a learning organisation are factors that are gradually acquired, rather than developed simultaneously.

Personal mastery

Personal mastery is the commitment by an individual to the process of learning. Individual learning is acquired through staff training and development, however learning cannot be forced upon an individual if he or she is not receptive to learning. Research has shown that most learning in the workplace is incidental, rather than the product of formal training, therefore it is important to develop a culture where personal mastery is practiced in daily life. A learning organisation has been described as the sum of individual learning, but it is important for there to be mechanisms by which individual learning is transferred into organisational learning.

Mental models

Mental models are the terms given to ingrained assumptions held by individuals and organisations. To have become a learning organisation, these mental models must have been challenged. Individuals tend to espouse theories, which they intend to follow, and theories-in-use, which is what they actually do. Similarly, organisations tend to have ‘memories’ which preserve certain behaviours, norms and values. In the creation of a learning environment it is important to replace confrontational attitudes with an open culture that promotes inquiry and trust. To achieve this, the learning organisation will have mechanisms for locating and assessing organisational theories of action. If there are unwanted values held by the organisation, these need to be discarded in a process called ‘unlearning’. Wang and Ahmed refer to this as ‘triple loop learning.’

Shared vision

The development of a shared vision is important in incentivising the workforce to learn as it creates a common identity that can provide focus and energy for learning. The most successful visions build on the individual visions of the employees at all levels of the organisation (and the creation of a shared vision is likely to be hindered by traditional structures where a company vision is imposed from above). As a result, learning organisations tend to have flat, decentralised organisational structures. The topic of shared vision is often to succeed against a competitor, however Senge states that these are transitory goals and suggests that there should also be long term goals that are intrinsic within the company.

Team learning

Team learning is the accumulation of individual learning. The benefit of sharing individual learning is that employees grow more quickly and the problem solving capacity of the organisation is improved through better access to knowledge and expertise. Learning organisations have structures that facilitate team learning with features such as boundary crossing and openness. Team learning requires individuals to engage in dialogue and discussion, therefore it is important that team members develop open communication, shared meaning and understanding. Learning organisations also have excellent knowledge management structures, which allow creation, acquisition, dissemination, and implementation of this knowledge throughout the organisation.

Problems/issues that may be encountered in a learning organisation

Even within a learning organisation, problems may be encountered that stall the process of learning or cause it to regress. Most of the problems arise from an organisation not fully embracing all the facets outlined above that are necessary in a learning organisation. If these problems can be identified, work can begin on improving them.

Organisational barriers to learning

Some organisations can find it hard to embrace personal mastery because as a concept it is intangible and the benefits cannot be quantified. Additionally, personal mastery can be seen as a threat to the organisation. This threat can be real, as Senge points out, that “to empower people in an unaligned organisation can be counterproductive”. In other words, if individuals do not engage with a shared vision, personal mastery could be used to advance their own vision. In some organisations a lack of a pro-learning culture can be a barrier to learning. It is important that an environment is created where individuals can share learning without it being devalued and ignored, so more people can benefit from their knowledge and the individual becomes empowered. A learning organisation needs to fully embrace the removal of traditional hierarchical structures. These are a barrier to the development of shared vision and to the sharing of knowledge.

Individual barriers to learning

Resistance to learning can occur within a learning organisation if there is not sufficient buy in at an individual level. This is often encountered by people who feel threatened by change or believe that they have the most to lose. The same people who feel threatened by change are likely to have closed mind sets and are not willing to embrace engagement with mental models. Unless implemented coherently across the whole organisation, learning can be viewed as elitist and restricted to more senior levels within the organisation. If this is the case, learning will not be viewed as a shared vision. If training and development is compulsory, it can be viewed as a form of control, rather than a form of personal development. Learning and the pursuit of personal mastery needs to be an individual choice, therefore enforced take up will not work.

The Wikipedia website has further links providing more details on each of the characteristics of learning organisations as described above. The references to the above summary are:

  1. PEDLER, M., BURGOYNE, J. AND BOYDELL, T. 1997. The Learning Company: A strategy for sustainable development. 2nd Ed. London; McGraw-Hill.
  2. O’KEEFFE, T. 2002. Organisational Learning: a new perspective. Journal of European Industrial Training. 26 (2), pp. 130-141.
  4. SENGE, P.M. 1990. The Fifth Discipline. London: Century Business.
  5. WANG, C.L. AND AHMED, P.K. 2003. Organisational Learning: a critical review. The Learning Organisation. 10 (1) pp. 8-17.
  6. ARGYRIS, C. 1999. On Organisational Learning. 2nd Ed. Oxford: Blackwell Publishing.
  7. MCHUGH, D., GROVES, D. AND ALKER, A. 1998. Managing Learning: what do we learn from a Learning Organisation? The Learning Organisation. 5 (5) pp.209-220.
  8. EASTERBY-SMITH, M., CROSSAN, M. AND NICOLINI, D. 2000. Organisational Learning: Debates past, present and future. Journal of Management Studies. 37 (6) pp 783-796. The link to the Wikipedia website is: http://en.wikipedia.org/wiki/Learning_organisation

Effective boards in the NHS

The NHS Confederation publication, Effective boards in the NHS? A study of their behaviour and culture, reports that NHS boards need to improve the way their boards work. While this is set in the context of the English NHS which is different in terms of culture, policy and structure, there are observations on generic governance issues which are of interest and relevance to NHS governance in general.

Link: http://www.nhsconfed.org/Publications/Pages/EffectiveboardsintheNHS.aspx

Building a better board

The July 2008 issue of the NHS Institute for Innovation and Improvement journal, In View, looks at how improving the composition and performance of the board can help raise the standards of the business.

With the pressures on modern organisations, both in the public and private sectors, to perform to ever higher standards, the role of the board and independent directors in particular, has become increasingly important. Consequently board composition and performance is under the spotlight as organisations search for ways to improve the contribution that the board makes to the business.

Read more on http://www.executive.modern.nhs.uk/inview/inviewarticle.aspx?id=281

What Makes Great Boards Great?

In his article in the Harvard Business Review September 2002, What makes great boards great?, Jeffrey Sonnenfeld asserts that in the wake of the meltdowns of such once great companies as Adelphia, Enron, Tyco, and WorldCom, enormous attention has been focused on the companies’ boards. Were the directors asleep at the wheel? In cahoots with corrupt management teams? Simply incompetent?

Sonnenfeld’s 25 years of experience studying board performance and CEO leadership led him to one conclusion: It’s time for some fundamentally new thinking about how corporate boards should operate and be evaluated. We need to consider not only how we structure the work of a board but also how we manage the social system that a board actually is. We’ll be fighting the wrong war if we simply tighten procedural rules for boards and ignore their more pressing need – to be strong, high-functioning work groups whose members trust and challenge one another and engage directly with senior managers on critical issues facing corporations.

Read the article at http://celi.som.yale.edu/sonnenfeld/articles/hbr_whatmakesgreatboards.pdf

Trust in the NHS Boardroom

In NHS England’s Institute for Innovation and Improvement’s journal, In View, of March 2005, Paul Stanton and Dr Jay Bevington share their observations on trust in NHS board rooms.

In a previous article in the journal, they argued that maintaining an appropriate balance between ‘trust’ and ‘challenge’ is a necessary, though not sufficient, precondition of effective board performance and therefore of good governance.

In this article the authors define what they think trust is and explore a distinction that they believe can be usefully drawn between ‘naive trust’, ‘reflexive mistrust’ and ‘informed trust’, arguing that it is only the latter that delivers long-term positive benefits within an NHS boardroom.

For more detailed insight from this article go to: http://www.executive.modern.nhs.uk/inview/inviewarticle.aspx?id=111

Boardrooms that work

Directors and senior executives rely on the integrity of the information they receive from their organisations. If information is flawed, there can be severe consequences for the organisation’s credibility, the reputation of its directors and executives and its financial position. Successful processes and procedures depend upon people implementing them effectively and their behavioural relationships. This guide explores the effect that behavioural dynamics have on effective decision making in the boardroom, in board committees and by senior executives. It is designed to raise awareness of the issues that arise in practice and to explore some of the types of behaviour that either promote or undermine good corporate governance.

Link : -http://www.group100.com.au/publications/g100_boardrooms-that-work2003.pdf

Thin on Top - why corporate governance matters and how to measure and improve board performance

Issue 18 of the NHS Institute of Innovation and Improvement’s online journal, In View, summarises the discussion in Bob Garratt’s book, in which he asserts that a number of well-known companies under scrutiny for possibly suspect accounting practices, and other corporations hauled before the courts, senior executives admonished, and in some cases imprisoned, for corporate wrongdoing, corporate governance is in something of a crisis.

Read more at: http://www.executive.modern.nhs.uk/inview/inviewarticle.aspx?id=280

Bob Garratt is also the author of the book The Fish Rots from the Head – The Crisis in Our Boardrooms – Developing the Crucial Skills of the Competent Director, in which he discusses whether an organisation’s success or failure depends on the performance of its board. An ancient Chinese saying is that the ‘fish rots from the head’. Yet the vast majority of directors admit that they have had no training for their role and are not sure what it entails.

As boards’ activities are made increasingly transparent under national and international law, there is an urgent need for a transformation in the way directors’ competencies are developed.

This book is published by HarperCollins Business ISBN – 10: 0002556138

National Inquiry into Fit for Purpose Governance in the NHS

The National Inquiry into Fit for Purpose Governance found a ‘culture of panics’ is endemic in the NHS in England, with short-term policy-making and performance management processes driven by external political influences.  In addition, the NHS’ day-to-day core activity of trying to make sick people better through medical intervention can also be regarded as a form of providing a short-term response.

It found that non-executive board directors are unwilling to openly challenge their executive counterparts; that there is an excessive focus on the relationship between the chief executive and chairman to the detriment of other board members; and that there is too much emphasis on the structure of the board, rather than on its processes and dynamics.

The wide-ranging study also found that some boards cannot perform their jobs properly because members are not given enough or - in some cases - any reliable data with which they can question the decisions being taken.

The key recommendations from the report were

  • The establishment of a design team for the board, made up of a small group of board members, given the brief of analysing the board and working up a process for improvements in board decision-making. The team should be made up of a few board members with a clear brief, setting out parameters and expectations. The team should highlight areas of structure, process, style and interpersonal dynamics and work out how to design meetings to improve these.
  • Board members should invest time in understanding each other, making the most of what each has to offer. Socialisation can lessen the likelihood of board members splitting into factions and expose tensions. Better understanding of all members should also weaken the chair/chief executive stranglehold on the board.
  • Ensuring there are deep and open information sharing across the organisation.
  • Challenge can be harnessed and ambiguity managed if this is the case.
  • Commitment to a challenge and questioning culture. Once board members have good enough information, a process of critical inquiry should be embedded in board practice. This culture of open and constructive challenge should be a model for the organisation.
  • Regular reviews and debriefs of board meetings and committees to highlight what areas of board process need attention. Practice and reflection leads to improvements.
  • Learning - organisations must accept that mistakes will happen but, when they do, ensure that the whole organisation learns from them. Board members have to take personal and collective responsibility for their behaviour and action. There also has to be a sense that in the trust the buck stops with the board.
  • “Feedback loops” – to generate an evidence-base for decisions. This means tracking the impact of decisions, and reviewing those to see if they had the impact they were supposed to, and if not why not. This is how an organisation progresses. Boards develop the capability to engage with the policy context to make the right decisions for their own trust. Part of this is ensuring boards have the right mix of skills and experience and those recruitment procedures are robust. Non-executive directors have to be clear what is required of both the board and themselves and use their own contacts for the good of the organisation. Part of this is working hard on engagement processes as part of its strategic work.
  • Boards establish a unique and important role for themselves as the custodians of the values of the NHS. In driving the performance of their trust, the board has to marry the emphasis on performance management with concern for the welfare of patients. The board has to set the climate for operational performance, and has to be the strategic guardian of the organisation.

http://www.cihm.leeds.ac.uk/new/wp-content/uploads/2009/07/gov-inq-short-report-final1.pdf

NHS Wales Performance

The Welsh Assembly is reviewing the process for monitoring and reviewing the performance of NHS Wales.

Currently the Welsh Assembly Government monitors the performance of the NHS through various measures and standards.

One of the ways the Assembly Government achieves this is by issuing an Annual Operating Framework each year.

The Annual Operating Framework (AOF) is designed to help organisations improve the health services they provide by setting out clearly what the Welsh Assembly Government requires them to do.  It contains policy requirements, national targets, and efficiency and productivity measures that must be achieved and maintained during the year ahead.

Local health boards and NHS trusts are required to provide quarterly updates on how they are progressing and achieving these measures and targets during the year. The organisations provide a quarterly report called a balanced scorecard for the Welsh Assembly Government.

The Balanced Scorecard

The Balanced Scorecard is an agreed set of measures that provide a comprehensive, but timely view of an organisation’s performance. Adopting a scorecard enables a wide consideration of performance as it focuses on four components of performance:

scorecard diagram

Within the Balanced Scorecard there is a logic that links the areas together. Assessing performance using this approach, the Welsh Assembly Government will be able to assess health and health services by asking:

  • Stakeholders – public, patients, politicians, NHS staff identify and measure the key outcomes that are required from health and social care in Wales.
  • Management Processes – identify and measure the key management processes needed to achieve these outcomes.
  • Resource Utilisation – identify and measure available resources and whether they are being used to best effect.
  • Innovation and Learning – identify and measure the elements which ensure the organisation is continually improving and developing.

In this way, each area of performance is linked to the others. Strong performance in any one area is unlikely to be sustained if there is poor performance in the others. Similarly, focusing all effort in one area will ultimately prove counter-productive, if it is done at the expense of the others. Only balanced performance across all four areas can lead to sustainable improvements in health and health service delivery.

Improving Performance

The framework is designed to facilitate continuous review and improvement. Results from the scorecard can be interpreted in a way that combines an assessment of current performance with an analysis of the potential for improvement. The potential for improvement includes the capacity for improvement within the organisation and the scope for improvement within its environment. This will result in the organisation being able to assess itself as being in one of the four left hand categories as shown below:

PERFORMANCE / IMPROVEMENT CATEGORY RESPONSE CATEGORY
Plateau
Good performance but with limited capacity or scope for improvement		 Challenge
Recognition of good performance linked with action to remove internal/external constraints/constructive challenging
Problem
Poor performance at the moment, with little or no evidence of the capacity or scope for improvement		 Action
More active support and advice/action to remove internal/external constraints/focused investment/direct intervention
Pathfinder
Good performance at the moment and evidence of further capacity and scope for improvement 		Recognise
Recognition and encouragement/investment of research and development fund/beacon status
Potential
Poor performance at the moment but with scope for improvement 		Encourage
Support advice and encouragement/access to pump priming funds

The purpose of analysing performance in this way is to ensure that the performance of a health system is matched to a response strategy designed to help ensure that its performance improves over time.

Using the Balanced Scorecard to measure each NHS Wales organisation’s performance. It will be important for NHS Boards to learn to use this tool so that there is consistency of approach for the organisation.

Developing high-performing organisations

In its briefing paper Developing high-performing organisations in the public sector, the Welsh NHS Confederation suggested that developing high-performing organisations is essential if the NHS in Wales is to keep pace with a fast-changing world.

Rising expectations and demand, new technologies and treatments, demographic change and unprecedented political and public scrutiny: these and other changes require us both to focus on delivering high performance, and to think differently about how to achieve it.

Link to the Welsh NHS Confederation briefing: http://www.welshconfed.org/companyData/1898/resources/High%20performing%20organisations1.pdf

What is productivity?

In its briefing, What is productivity? (2006), the Welsh NHS Confederation says that NHS has received unprecedented levels of money since 2002. Since then, there has been growing criticism that the NHS is becoming less productive and is not providing value for money. This briefing examines what productivity actually means and how it relates to how well the NHS is treating patients.

Link: http://www.welshconfed.org/companyData/1898/resources/What%20is%20productivity.pdf

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