Commissioning And Procurement

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Developing Capable Health and Social Care Organisations: Commissioning and Procurement in Context

A Systems Approach to Commissioning Change in a Problematic world


Commissioning v Procurement: Competing Process or Synthesising Design?


What are the benefits of Commissioning?

Stating that >90% of problems are due to the design of the “System” and not to people avoids blame. Note that people are integral part of an open adaptive system. In others words, it should be recognised systems are social, economic, technological and not just linked processes and activities

How does Commissioning help us with the issues of procurement?

• Clarify the problem

• Validate the solution


Scope of Common Competencies


The Continuum between Hard & Soft Systems Approaches (What is the balance point?)

Hard ApproachesThings dominate the

problems and its setting

Soft ApproachesPeople dominate the

problems and its settingA continuum exists between these poles

A critical question is. What is the balance point from which to Commission AND what is the level of system or subsystem

Maturity, Culture, Learning

ANDWhich Procurement Procedure and Model of Competition will work?


What is a Commissioned System?General Systems Model -A simple view of a System.

What is the System of INTEREST?• Inputs, outputs• Scope, Boundaries,• Actors, Players, Owner & Customers• Environment• Purpose(s) can be several depending on world views • Context and Concept • Interfaces and relationships?

System of Interest


A Simple view of a System

A SystemInputs

Defined processes executingRepeatable transactions, e.g.

• Handle 10,000 calls• Produced 2,000 cars• Make 12,000 loaves• Sign 200 prescriptions• Buy a train ticket

A system is a construct or collection of different elements that together produce results not obtainable by the elements alone. The elements, or parts, can include people, hardware, software, facilities, policies, and documents; that is, all things required to produce systems-level results. The results include system level qualities, properties, characteristics, functions, behaviour and performance. The value added by the system as a whole, beyond that contributed independently by the parts, is primarily created by the relationship among the parts; that is, how they are interconnected (Rechtin, 2000).

Outputs

Controls/ rule set

Feedback


The Existing Procured System closed – deterministic and no concept of subsidiarity or decision making derogation)

Activity FlowInputs

PullFlowWaste / 7 MudasDemandCustomers

Outputs

Feedback

The rule set determines (e.g. a specification) the:

• Inputs • Outputs• Feedback loops• How the systems /process works•The feedback loop can change the rule set (e.g. change the specification)

……………….. Note the rules set lies WITHIN the systems boundaries

Controls/ rule set

System Boundary


Closed – Deterministic SystemClosed systems models involve recursive patterns of feedback

Viability depends on maintaining identity and stability

Self-construction limits feedback and stifles feedforward

In the “closed” systems perspective, a system is analysed in terms of its own information and perspective

Boundary is regarded as closed

Organisational meaning: Emphasising stability, group loyalty, security, clear boundaries and tight controls

Sources: Bateson, Beer, Maturana, Varela


An Open Commissioned System

Open systems models shows dynamic relationships between the organization and the environment

Viability depends on maintaining critical interchanges between system and the Environment

Sources: Emery, Miller, Rice, Trist

The open systems perspective emphasizes exchanges of information and energy with the environment. The Boundary is regarded as porous and may be diffuse.

Organisational meaning: Emphasising flexibility, collaboration, consensus building and authentic communication.


Multiple Perspectives A viable Systems View – How does optimising processes at an operational level help development of capability?


What are the Issues we are addressing?

A Messy Unbounded Problem? Is Procurement the answer?It is not a simple cause and effect problem it is about the relationship between Decision Making Cycles


Tame v Wicked Problems


“Messy/Wicked Problems”

Diagnosis

Analysis

Tame problems may be quite complex, but the lend themselves to analysis and solution by known techniques, for example:

Six Sigma, Lean Sigma, TPS, TQM and TPM methods


Clarifying The Results• What do we specifically want from the solution.

• Why do we want this solution?

• How will we know that we have achieved it?

• When we have achieved it, what else will improve?

• Where, when and with whom would we want this

solution?

• Will we be risking anything with this solution?

• What are the barriers to this solution?

• What would be enablers for this solution?

• What resources that we already have can be deployed to

help?

• What new resources will we need?

• What is the first step to be taken


What is the System of Interest to be Commissioned?• What's in, what's out?• What's the boundary?

External Environment

STEEPVDetermines the

context in which the system of interest

has to operate

System 2

System 3

System 5

System 4

System 9

System 5

System 7

Containing System

Sibling Systems

System of Interest – local context

SystemBoundary

InterconnectionsRelationships &

Emergent properties

External Systems 1

External System …n


Commissioning Perspectives Whose System of Interest?what's in, what's out?

The Procurement view

Operations View

Finance View

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Start with Systems maps and rich pictures

Complexity and multiple Relationships and scenarios(story boards) Can be added later

If required, schematics and one line diagrams can be produced at a detailed level

Overall System Architecture

Initial CapabilityModel

System of Interest

1st Resolution Model

ProcessLogic


Likeliest Intervention for Performance Improvement

Rule SetComplex

Many Value Analysis to understand sources of

value, cost and performance

Diagnosis to understand relationship between

sources of value (context) and value chain; determine

and set boundaries.

Rule Set:Simple /Few

Simple Analysis to understand cost and performance, e.g.

Six and Lean Sigma, BPR

More complex end-to-end Process Analysis needed

to construct value chain and understand, cost, value and

performance

Process ComplexitySimple

Process ComplexityComplexTame Problems are

suited to low level procurement procedures

“Messy/Wicked Problems”Including “special causes”Note; innovation often falls into this area and requires high end permissions and procurement procedures

Clarifying the Problem?What is the systems of

interest?

Tame problems may be quite complex, but the lend themselves to analysis and solution by known techniques.

Complexbehaviour canbe based onsimple rules


Clarifying The Problem• What is wrong? Will competitive process address this?

• How long have we had the symptoms? Are the existing perverse

incentives?

• Does everyone agree that these symptoms are a problem?

• How does this problem constrain us?

• What will happen if we do not fix this problem?

• What is the worst example of this problem?

• Have we tried to fix this problem and, if so, how?

• What happened?

• What has caused or contributed to the problem?

• Who else is affected by this problem?

• Whose problem is it?

• Is the problem too large to solve?

• Have we the resources to solve this problem?

• Are we solving the right problem?


Where do we make the intervention?Clarifying The Problem?Where do we Start?At what level do we start?How do we set scope and boundariesHow we identify airs of concern?'

• Where do we make the intervention?• At what level do we make the intervention?• What is the systems of interest?

Systems Level, e.g. Viable System Model-Supply Chain

Transactional levelA la “lean thinking”, e.g. Order

Entry


What elements of the Landscape do we have to Change to Achieve:

• Delivery Performance? What we deliver

And / or

• Relationship Performance?The behaviours we need to exhibit


Can Requirements Management (procurement) be applied to people services?

• High dependency of tacit knowledge and experience

• How do the public/recipients directly influence on the rule set

• Variable decisions action cycles (OODA loops)

• How do we pace, match and lead delivery partners

• Team goals and organisational KPIs

• What is the trade off between relationships and end services


What are we Commissioning: Innovation and Continuous Improvement?

Customer focus – long term market growth – customer retention

Initial payback and long term social dividend

Performance Criteria

People, process, cultureUsually technologyOrientation

Usually spreadCan be highRisks

Conventional know-how's and state of art

Conventional know-how's and state of art

Stimulus

CollectiveSelect few with know howApproach

EverybodySelect few with know howInvolvement

IncrementalIntermittentChange

Slow small stepsFast – big stepsPace/time frame

Long term – long lastingShort term - dramaticEffect

Continuous Improvement

Innovation (Breakthrough)


Which Rule Set has Primacy

• Issues of Subsidiarity to EU law – welfare/competition

• What decision action cycles now apply?

• Who has the decision making rights?

• Who actually benefits?


Creative Holisms

1. Is there evidence of ST?

2. What are the requirements management?

3. Can the changes be measured in a meaningful way?

4. Who actually benefits?

Systems Thinking

System EngineeringTQM

TACIT KNOWLEDGE

Behavioural Know How

Increased Understanding

Commissioning

Commissioning And Procurement

Documents

system inputs

level of system

system boundary

deterministic system

open adaptive system

system level qualities

systems process

systemslevel results