Deming and the future of public services

Back in the 1940s, the great American theorist of ‘total quality, W. Edwards Deming warned that assembly lines, in themselves, were not efficient at all.

This is rather an important lesson, given that our public services are being re-designed by people who think that assembly lines are the apotheosis of efficiency.

Deming’s story is rather peculiar, because he found that his fellow Americans were not quite ready for this message, so he took his ideas to Japan after the Second World War, and was enormously influential.

Efficiency is all about getting things right first time, he said, because then you don’t have to do it again, as I explained i my book The Human Element.

He was astonished at how much the American factory system wasted, in materials and time, just by failing to pay attention to quality. The result was the enormous sums of money were spent by organisations just to put right the mistakes they had made – and splitting up jobs means more mistakes.

Now Deming’s name is being gargled with at the moment by the influential NHS blogger Roy Lilley, as a way to explain how ineffective the CQC has been – in fact, about the whole business of inspection and how it has failed miserably to make hospitals safer.

It just so happens that I went to a fascinating conference yesterday, organised by Deming’s vicar on earth, the systems thinker John Seddon.

Seddon himself was stuck on a train thanks to the storm, but I did hear have the chance to hear a very interesting presentation by Dr Toby Lowe, Visiting Fellow at the University of Newcastle Business School, setting out the problem with targets as clearly as I have ever heard.

He never mentioned Goodhart’s Law – that any measure used to control will always be inaccurate – but that was the gist.  He also made two other really important points, which need thinking about.

First, that targets have the effect of shifting the emphasis of public services – instead of serving the needs of the public, they become a means by which frontline staff can meet their set targets.  Service users become a resource to be exploited, as far as they are useful to meet targets and little further,

Second, that the perverse effects of outcome targets have been described pretty clearly at least since 1977, which is 35 years ago.

“Given that,” said Lowe, “if you are commissioning services using performance targets, then you are responsible for the gaming that results, and for undermining the kind of organisations that can go the extra mile to make things happen.”

I am especially interested, as far as the work of the New Weather Institute is concerned, in how we provide the kind of transparency that Westminster and Whitehall need without the whole caboodle of IT systems, back office divisions, and outcome-based management that tends to undermine the effectiveness of services and make them more expensive.

That is at the heart of one of the key questions about the future of public services – how do we sidestep the implications of Goodhart’s Law, and still find ways of funding what works?  In short, how do we shape the payment systems of public services so that they do not reflect the shortcomings of our performance management systems?