Diagnosis: healthy IT for NHS

According to a recent National Audit Office report, the National Health
Service IT project ­ Connecting for Health ­ has been a success, despite its
budget more than doubling from £6.2bn to £12.6bn.

Since its beginnings, the project has attracted large amounts of negative
press, culminating in reform minister Lord Warner’s recent statement that it
could ultimately cost as much as £20bn. But the NAO has refused to censure the
project, instead offering several plaudits, as well as advice for taking the
project forward. The advice and recommendations also apply to large-scale
private IT installations.

Going forward, the NAO offered the NHS and Connecting for Health a number of
recommendations to ensure the project remains on course. They include:

• The Department of Health and NHS Connecting for Health should provide
greater clarity to organisations and staff in the NHS as to when the different
elements of the programme will be delivered. l NHS Connecting for Health should
ensure that it has a robust engineering-based timetable for delivery, which it
is confident its suppliers are capable of achieving.

• NHS organisations should communicate to staff how such a timetable will
affect them and forewarn them of the challenges facing the programme, so that
the setbacks and changes of priority do not cause a loss of confidence.

• NHS Connecting for Health should continue its strong management of
suppliers’ performance, including its imposition of contractual penalties, where
needed, to encourage suppliers to deliver on their commitments, including, if
necessary, termination and replacement of contractors.

• The department and the NHS should prepare an annual published statement
quantifying the benefits delivered by the programme. Quantification of benefits,
including financial benefits and quality improvements delivered, set against the
costs incurred, will help to demonstrate the actual benefits.

• The department, NHS Connecting for Health and the NHS should commission a
study to measure the impact of the programme on local NHS IT expenditure where
systems are now being deployed, and use it to provide an up-to-date assessment
of the overall investment case for the programme.

• The department and the NHS should continue to evaluate the experience of
NHS organisations that have recently introduced IT systems similar to those to
be provided by the programme.

• The department, NHS organisations and NHS Connecting for Health should put
in place training and development programmes to strengthen capability, including
project management and IT skills available to the wider NHS.

Lessons to be learnt

The NAO also published a “lessons learned” chapter, which other government
departments, as well as private companies, could learn from. These include:

• Speed ­- A swift procurement process increases the likelihood of
technology being up to date and benefits being delivered earlier. It also
reduces overall bid costs for bidders and the costs of the procurement process.

• Maintaining competition -­ Negotiating contracts with more than
one final bidder maintains a competitive tension between bidders and may offer
further reductions in price.

• Not having a preferred bidder stage -­ This avoids the risk of
prices creeping up once suppliers know that competitive pressure has eased.

• Use of templates for financial models -­ Requiring bidders to
complete a template demonstrating their financial model can assist the
contracting authority in comparing bids on a like-for-like basis and identifying
where bidders could reduce their prices.

• The principle of ‘payment for systems that are delivered and
working’ -­ This incentivises delivery and reduces the risk of the taxpayer
having to pay for unsatisfactory services.

• Intrusive management of the supply chain ­- The contracting
authority can rectify problems with delivery by stepping in to the supply chain
in the event that suppliers are failing to deliver. Suppliers can be required to
replace underperforming subcontractors.

• Acting promptly to address problems ­- Tight monitoring of
performance and robust dialogue with suppliers provide early indicators of where
the contracting authority needs to take action.

• Applying tight change control mechanisms -­ These help to ensure
that the changing needs of the NHS can be met and also to prevent suppliers
charging excessive prices for changes.

• Ownership of software and transition requirements -­ In the event
of a new supplier taking over a contract, the contracting authority retains
ownership of software developed, and suppliers must assist in transferring
responsibilities for services to a new supplier.

• Publishing information about progress -­ Having a dedicated
website with project activities, information about service levels, data and
forward looks of deployment activity can help provide transparent information to
future users about the progress of the project.

• Maintaining continuity of leadership ­- Continuity has helped with
work on the IT system, and its absence has hindered securing NHS organisation
and staff engagement.

• Engagement of users and user organisations ­- Early involvement of
users and user organisations helps to ensure broad support for change and
increases the likelihood of successful implementation. Transparent communication
about progress between system developers, implementers and service users is
vital to maintain users’ confidence in what is being delivered.

• Working with existing systems -­ Introducing new systems alongside
existing ones adds an extra level of complexity that needs to be planned for,
especially when there is little standardisation among the existing systems.

Much of this Briefing is reproduced from the National Audit Office report:
Department of Health: The National Programme for IT in the NHS