Customer Reviews: Systems Thinking in the Public Sector: The Failure of the Reform Regime... and a Manifesto for a Better Way
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on March 31, 2008
Extracts from Philip Johnston's review of the book in the Daily Telegraph:

"Do you ever wonder how the Government came to make such a pig's ear of running the public services that by 2010 annual spending by the state will have doubled since 1997 to the astonishing sum of £674 billion - with little obvious to show in the way of improvement to justify such an outlay?

We know that vast amounts of our hard-earned cash are simply wasted, but have only a vague idea of the cause of this profligacy. Is it because the Government has employed too many bureaucrats, or because the computer systems have crashed, or because the public sector is simply incapable of doing anything efficiently?

I have been reading a book which purports to provide at least part of the answer: Systems Thinking in the Public Sector. The title makes it sound more boring than an Alistair Darling speech, but it is an extraordinary insight into why, at the end of each month, millions of us are left wondering where on earth all the money taken from us in tax has gone.

The argument compellingly made in this book by John Seddon, an occupational psychologist and "management thinker", is that the Government has designed failure into almost everything it does on our behalf. It has not done so deliberately; but it is culpable because it has failed to listen to people who know better how to run services on behalf of the customer rather than the producer.

On the eve of the Budget last week, Gordon Brown set out what he called the third stage of Labour's public sector reform programme.

It was, he said, "designed to meet the rising aspirations of citizens and to achieve excellence and opportunity for all". The Prime Minister said the first stages "inevitably meant using national targets, league tables and tough inspection regimes to monitor progress". Now he wants to focus on diversity of provision and choice.

We can only hope he had Seddon's book by his bedside as he pondered these changes, because it is evident that the whole edifice of public service delivery is rotten from top to bottom and needs a fundamental redesign. Throwing more money at it will simply compound failure. And the choice Mr Brown's reforms seek to offer is pointless if we are simply being asked to pick a school or hospital from three bad ones.

Seddon says that the fundamental problem is precisely what Mr Brown identified as the "inevitable" requirement of efficiency: the obsessive control of public service delivery by a central command structure that is largely ignorant of how to do the job properly, but whose mechanisms - targets, inspections and the rest - have become an orthodoxy that few dare challenge.

"If investment in the UK public sector has not been matched by improvements, it is because we have invested in the wrong things," says Seddon. "We think inspection drives improvement, we believe in the notion of economies of scale, we think choice and quasi-markets are levers for improvement, we believe people can be motivated with incentives, we think leaders need visions, managers need targets and that information technology is a driver of change. These are all wrong-headed ideas. But they have been the foundation of public-sector 'reform."

Seddon says that public services have requirements placed on them by a whole series of bodies that are all based on opinion rather than knowledge. Many are burdened with specifications, targets, regulations and the like which are actually making matters worse.

The really scary thing is that the Government is simply digging a deeper and deeper pit into which to pour our money. New management approaches and further "reform" are compounding previous mistakes.

"At the heart of the problems with public-sector reform is the regime's incapacity to do the right thing," Seddon says. "It is focused on doing the wrong things and assumes compliance to be evidence of success. The inability to act is systemic."

Nor is he enamoured of trying to improve services through "local engagement" or "citizen's juries".

He argues that what people want from public services is for them to work properly, not to pick a heath-care model, vote on a local education policy or elect a chief constable. Waste can be eradicated if the systems are properly designed against demand rather than phoney outcomes.

Take the payment of housing benefits to four million people. The system the Government designed for doing this involved having a front office for claiming benefits and a back office for processing them.

Immediately, says Seddon, there was a problem. It meant that the person with whom the benefit recipient dealt was different from the person who would decide about the payment. Targets were then superimposed on this structure - how quickly back-office phones were picked up, or correspondence answered, or the time taken to calculate a claim.

While this might look like a sensible approach, Seddon says it simply guaranteed that, from the claimant's stand-point, the service remained poor because the back offices simply became repositories for complaints about delays and wrong decisions. It also opened the system to fraud.

What should happen is that when people turn up to get a service, they are met by someone who can help them get it.

"As soon as you create a split between front and back office, you also create waste. To do the same on a larger scale is to mass-produce it." The same failures are built into all public services, and to address the problems by reducing the number of targets is pointless: "Doing less of the wrong thing is not doing the right thing."

Waste on the scale we have seen demoralises people working in the public sector and angers those who pay for or use services. It is also stupefyingly costly. Cumulative public spending since 1997 stands at £4,500 billion - double the total for the preceding 10 years.

How much of this is wasted? The public sector employs 800,000 more people than in 1997, many of them engaged in developing specifications, writing guidance, drawing up standards, devising targets, enforcing inspections - all in the name of a reform programme that does not work properly.

It is barmy - a madness in whose name we have been mightily fleeced, and continue to be so.
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on February 2, 2009
"When a measure becomes a target, it ceases to be a measure." Goodhart's Law is as powerful, if not as well known, as Parkinson's Laws. It deserves to be better known and understood.

This book helps us to understand the working out of Goodhart's law, and shows us how disastrous it is when people in charge do not understand Goodhart's Law. It uses British examples, but the principles would be just as valid in USA and other countries. The current British economic horror story is in large part due to the public sector flaws that this book describes so well.

The basic error which Seddon exposes is that failure to think of the whole system or pathway of help, leads instead to focusing on parts of the system, with the result that although each bit may be doing its bit, the overall result is awful, as one part clashes against another. This dynamic is currently endemic in Britain's public sector leading to valueless activity, meaningless measurement, and ever poorer service, at ever greater cost. You and I as taxpayers are paying heavily for this stupidity. David Craig describes the full costs in his book Squandered.

The dynamics of not trusting the staff, not believing the staff's reports, working to meet the target, rather than to meet the need are powerfully described, with examples drawn mainly from the housing sector. I could supply many examples from the UK NHS, and teachers, soldiers and police would readily testify to the truth of Seddon's argument. Their managers would utterly deny there is a problem, and set about rooting out the few bad apples who disturb their illusions. It's not that managers are intrinsically daft, it's just that the tasks they are set are misdirected from the start. Politicians wonder how the services get poorer even as all the targets they set are met.

Seddon's book is seditious. It makes a powerful case that most of the people in the public sector involved in regulation, management, specification of roles and contracts, are actually wasting their time, and even worse they get in the way of front line staff trying to do their jobs. When the truth that Seddon articlulates is fully understood a whole load of jobs and staff in the public sector will need to disappear.

This is an excellent book. It challenges current orthodoxies, and explains why front line public servants such as doctors, teachers, police so detest their management. This book deserves to lead to major changes in how the public sector works. Management that is focused on targets, and looking good to superiors and politicians, rather than on delivering good service to clients and patients is useless.

I recommend this book to MPs, councillors, and to front line public sector workers. Their managers must not read as it is dangerous, and they don't need to know it, or they will lose all belief in their work.

This book is very powerful medicine, and the British public sector would benefit from a large dose of it.
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