Tuesday, 2 November 2010

Productivity 7: How replicable is productivity?

This is the seventh in a series of productivity notes by Sarah Fraser.  If one organisation or region is classified as productive, can we make generalised statements that the rest of the organisation or nation can implement the same and be as productive?

A new report by York University is making big claims.

"The NHS could cut expenditure by £3.2billion without reducing the number of patients treated if all parts of the country were as productive as the South West, according to a report published today by the Centre for Health Economics at the University of York."

The report has many maybe's and possibly's as to whether the rest of the NHS could see the same cost savings if they performed like the South West Region.  I have no doubt the SW is producing excellent care. My concern is headlines like this paper produces sets unrealistic expectations on others. The delivery of healthcare is significantly contextual in its nature. Services all over the country reflect the complex make up of the areas they serve. The report summary on their website states:

"South West may also benefit from a more stable workforce, vacancy rates for non-medical staff being well below the national average. Lower productivity in the hospital and community sectors may be because more work is undertaken in primary care."

I believe this is enough uncertainty to warrant being very cautious about ratcheting up national numbers. Additionally, there is significant use of the "average" in this report. I am not convinced that averaging data and using the average as a measure is a good one for healthcare. As I pointed out in my earlier Productivity note, there is a big difference between accuracy and precision; basically, it is possible for there to be little variation across the regions (precision) but they are all delivering the wrong solution (accuracy).

Like all theories, this research is helpful to a degree (mostly in applying judgement) and like all theories, needs to be treated with a pinch of salt. If you are going to quote the headline £32billion on the stage then make sure you've read and understand the limitations of the report.

(To those who read the previous Productivity note about definitions - productivity is defined in this research report as output / input - how much output you get for the inputs...)

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