12 May 2017 | Finbarr Murray
For many years there was little attention paid to the analysis of available data across comparable sites, writes Finbarr Murray. But those views are now consigned to history with significant steps being taken to use this information as a key driver for cost reduction.
I once worked with a colleague who had a mantra. The front of house is given 100 per cent and each department away from the front is reduced by 10 per cent. There is a lot of truth in it. I've been to a lot of organisations where the entrance is all glass, marble and flowers, but take the lift to the 5th floor and it's worn carpet and a mix match of furniture - in other words, putting your cost where it counts.
After staff costs, FMs often top the next biggest influenceable spend. The NHS is unique in terms of the detail available and the analysis done when comparing, peer to peer. It's unique because although most trusts run as autonomous bodies, a national annual reporting cycle of FM costs is required from each hospital.
This annual analysis is the starting point for value engineering operating costs with everything from the cost of food to cleaning to estates maintenance under scrutiny. When I told my former colleague that NHS FMs had comparative data for every element of costs for every hospital in the country he couldn't believe it. His view, and mine when I was in the private sector, was that this data is a powerful budgeting tool and something many industries would kill for.
For many years there was little attention paid to the analysis, with it being seen at best as an interesting piece of information and at worst, an exercise that got in the way of the day job. Those views are now consigned to history with significant steps being taken to use the information as a key driver for cost reduction. The data set over the past two years has become a mechanism by which hospitals can compare and contrast, be held accountable against, and crucially understand the available opportunities.
While taking the 100 per cent only at the front door approach wouldn't work for a hospital, we could look to take percentages out for each service that goes above the average. After all, should we pay more for the same thing in different locations?
Finbarr Murray is director of estates, FM and procurement at East Kent Hospitals University Foundation Trust