A common sense approach to bringing the true “value” of positive staff morale into financial planning, budgets & change management.
As far as I know pretty
much everything in the NHS has a cost code, this information is then used to
plan, manage and of course generate “charges” for treatments and procedures for
accounting purposes. Thus management can see how their budgets are being
deployed and identify areas where savings and improvements can be made.
Sounds perfectly
sensible, or does it? So is there something missing from the equation,
something not factored in to how budgets are calculated and managed that is
actually creating unseen costs downstream?
If the above is the
conventional wisdom lets challenge that for a moment drawing in part from my
experience with internal comms, managing change and workforce development
matters.
A friend of mine has had a very tough life, from childhood sexual abuse to time in
prison for violent episodes, for him hospitals represent institution and authority,
as he say he still never enters a room without first looking for his escape
route.
Against all his
expectations and fears his experience when being assessed for a hip operation was
an “epiphany”(his words) and he was so moved he wrote to the hospital concerned to thank
them, as everyone one he encountered from cleaner to consultant showed a
kindness and compassion that was alien to him at the age of
nearly 70.
Now reflect on what
it is like working at Homerton who made him feel so at ease and where the
caring nature clearly runs through every strata of the staff.
I know if it was me
working in that atmosphere it would make me want to stay, to make best value of
training when offered and my job satisfaction would be very sustaining.
If one continues
this line of reasoning and you take a look at how hospitals perform, there is a
very strong correlation between the morale of the workforce and hospitals that
have “problems”. Can anyone show me a
hospital with high staff morale that has got itself in the news for the wrong
reasons…I am pretty confident that if there are examples out there they - are isolated?
So in summary the up
sides of a happy workforce where morale is high do have tangible and quantifiable
benefits:
Less cost of
recruitment as your workforce wants to stay.
Organisational memory
is retained as a consequence.
Patient experience
is improved with all the proven benefits to them
Happy teams look
after each other, problem solve and collaborate.
The culture becomes
far easier to manage when change happens.
In an open culture
good ideas are given space to emerge.
If I wanted to make
a change to how the NHS spends its valuable resources it would be to factor in
the “value” of the benefits I have highlighted.
So how do you make
that work within the existing framework?
I think the answer
is simple, it’s not rocket science to work out the cost to the NHS of people
leaving having received training plus the cost of recruitment. High staff turnover
rates in a department means the core staff are constantly having to bridge the
gap till the new person is up to speed. What does that cost in terms of efficiency
and team morale?
In the care sector, if
a carer leaves after the first year the hard cost to the sector is said to be
around £3,500! The figure for those leaving the Health sector would be
considerably higher given the additional investment in training.
So that if you like
is the business case, now how to integrate that in to the cost code model?
My solution is to
award a financial value to staff morale, to think about it in financial terms.
So that actions
taken that may enhance staff morale have a cost code with a positive value applied
to it, which is included in the calculations.
If all plans that
involve staff should be required to factor in the morale costs, so those with a
negative value that were damaging to morale would be working with the true and
real costs to the organisation, not in isolation on a project by project basis.
The approach means
that financial planning has the human element inbuilt in to the accounting
process, initiatives that have a high score on the “morale scale” factored in
to the total budget are actually saving downstream costs that still have to be
covered by another part of the business anyway, it’s all part of the same pot
of money after all.
To engage staff in
the process, who I believe would see this as an extremely positive step in their
workplace by management; they could be asked to help put the value on the
things that they feel are important in terms of staff morale.
I suspect it will
vary very little from hospital to hospital, this is a people thing. After a
year there would be an extensive data set from which one might be able to standardise
the “morale/wellbeing cost code”.
To not factor in the
positive and negative effects of staff morale is to bury ones head in the sand because
the figures and evidence around retention and recruitment alone can show that
these are hard costs to any Trust.
Compassion is another area that has a direct financial value to both care and health, I don't personally believe you can train people to be compassionate in any lasting way. It is very poor value for money.
You can however facilitate those with compassionate natures to the benefit of patients and the service overall, but you have to think a little different.
I would go further and say that the "common good heart found in compassionate people " is the glue of happy teams, the source of real job satisfaction.
There has been a huge investment in training around "compassion" post Francis, such an insult to many for whom putting the patient first is instinctual.
It is possible to identify the people with the right stuff in them at the recruitment stage. I created a tool that was very good at measuring compassion http://tinyurl.com/bfp3qw3
Jon
copyright Jon Bryant 2015
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