HBI Deals+Insights / Healthcare Reform

NHS = British Leyland?

In the autumn of 2013 Lord Warner, a labour member in the House of Lords, described the NHS as similar to British Leyland, the state-owned car manufacturer, which went bankrupt costing the tax payer billions of pounds and the loss of 1m jobs in the Midlands. So, I was interested to find myself talking to a manager who moved to the NHS, and then into private healthcare, after starting his career, at, yes, BL!

Interestingly, he says that, indeed, the parallel with BL is a strong one. “You get some good managers  in the NHS, but most get worn down by the bureaucracy and the impossibility of change.” He subsequently moved from BL to another car manufacturer, which had links with a Japanese car maker.  This meant, he said, that his new employer got the importance of lean manufacturing and other Japanese innovations. At BL, on the other hand, managers would say ‘The Japanese turn out cheap cars by using cheap rubbishy components.’ They were in denial.”

Again, he sees a parallel with the NHS. Innovation there, he says, is extremely difficult, because of unionised labour, the medical profession, bureaucracy and government meddling.  And he says the attitude of BL managers to Japanese car makers is similar to how NHS managers view private healthcare providers. Even today, NHS hospital management teams, faced by outsourcing choices which would dramatically reduce costs without hitting quality, refuse to make decisions. “They are waiting to see if Labour wins the next election. Meanwhile, they don’t want to do anything to upset local politicians.”

So what do we learn from the comparison? If correct, I think, it demonstrates the difficult of turning round the NHS. An organisation with a culture where real change has become all but impossible, simply can not be expected to transform itself. Of course, unlike in the car industry, the average UK consumer has no choice but to buy “the NHS car”.

The comparison is a radical critique. It is unfair? You could argue that it is impossible to say, as we do not have any meaningful direct comparisons with other national healthcare providers. But constant concerns about service levels does suggest that, just as BL turned out shoddy cars, so large parts of the NHS turn out shoddy healthcare.

Is there a parallel in other European countries? The answer is yes, but the rot has not set in to the same extent.  In no other European country, do we have a single hospital (Mid Staffordshire) where an investigation revealed at least 400 more deaths than would have been expected.  In fact, it was subsequently revealed that eight other NHS hospitals had worse death rates.

We would welcome your thoughts on this story. Email your views to Max Hotopf or call 0207 183 3779.