Examples of performance measurement within the NHS: Independent auditors will adjust the criteria each year without publishing the exact weighting*. This will give all NHS institutions and staff an incentive to pursue best-practice across a range of areas:

Number of patients treated, number of waiting patients, average length of waiting, average wait to see specialist, feedback from treated patients, success rates of operations, numbers of re-admissions, lengths of hospital stays, feedback from families, cleanliness of wards, infection rates, number of missed appointments, number of complaints, and improvement across all these measures compared to the previous year.

Similar examples are available for schools and other public services. This approach to performance assessment will also be used in other public services.

*

Q) Why set out broad areas for assessment without publishing the details of the measures to be used?

A) The rationale is to motivate staff towards excellence where they work in a business or service environment where the output is complex, largely qualitative and difficult to measure. Typically, setting a single quantitative measure (e.g. waiting list length) will tend to lead to unintended (and even unconscious) behaviour in order to meet targets (e.g. allowing waiting times to increase, delaying patient entry onto waiting lists or even compromising standards of care). Under the World2Rights assessment system staff will expect that all of these aspects will be measured (along with patient satisfaction, re-admission rates, ward cleanliness..) and will therefore pursue excellence and, indeed, creative solutions in order to improve overall performance.

Q) Is this approach arbitrary or unfair?

A) Not at all. Each year, the evaluators will have set their criteria in advance and will have decided what to measure and how to weight different measures of performance. Where staff or departments are being compared with each other, this will be done using the same criteria. Although the exact weighting of measures will never be published, evaluators will give broad guidance to staff and will highlight what the current priorities might be e.g. ward cleanliness. They will consult managers and patients as they review what the priority measures might be for the coming year and, if necessary, will introduce new criteria.

Q) Does the approach fail to prioritise and will it result in a lack of focus?

A) No. The approach does not mean that everything is a priority. It is not necessary to pursue excellence in every area - there is an opportunity to indicate low priorities as well as high priorities. Excellence is broad but it is not infinite. It is beneficial to focus organisations on delivering what is really important. But that does not mean that there is only one important measure. It is true that a public service can lack a key quantitative objective (for example maximising profit) and this makes management more difficult, but even in profit-maximising private enterprises it is necessary to attend to a range of quality measures in order to succeed (e.g. customer service, cost control, recruitment of staff, inventory management, product innovation...).

Q) What can the NHS and other public services learn from the failure of command economies such as the Soviet Union?

A) Firstly, ideology very rarely solves real world problems! That includes ideological approaches to privatisation and the introduction of market forces. But command economies did show how difficult it is to co-ordinate the efforts of economic agents in the absence of the profit motive and simple measures of performance. A factory would limit performance in one year so that its improvement measure looked great the next year. If it was assessed on the basis of quantity, it would produce a high volume of iron even if its quality meant that the iron was unusable. Staff who were rewarded for performance and innovation could be isolated by their colleagues. Recommendations for the NHS, for example, would be:

inspirational leadership to draw upon the public service ethos of staff
identifying what really matters to patients and orienting the service around that
setting priorities and allocating scarce resources on an equitable basis
using a range of measures to assess performance and incentivise improvement
recognition that there is no simplistic way to measure performance
going back to patients to find new ways to describe and measure performance
going back to elected political leaders to agree priorities
recognition that staff have motives - along with their public service commitment, they also need to be paid, to be recognised, to have better working conditions.

(People sometimes think that, because there is not profit motive, that staff do not have any motives other than their public service commitment. That's not right, for some people job security or pay is a very important reason why they come to work)