Thu 25 October 2012


NHS IT procurement problems

This article orginally appeared as part of a series of articles I was commissioned to write.

How would you go about buying a second hand car? You could draft a specification and invite people to become registered suppliers (by filling out a word document!?) and bid to sell you a car that meets your specification…. Picking the strongest bid as the winner you could then rest easy that you’d achieved the best value for (the taxpayers) money possible.

Of course as an individual buyer keen to get a good deal on your second hand car you would do well to accept more of the responsibility for ensuring that you get good value for money. This would involve actively seeking the best value for money second hand car you can find and keeping transactional costs for sellers to a minimum. It makes sense to keep transactional costs low because the pool of potential suppliers is then larger.

In other words the population of people with second hand cars to sell is much larger than the population of people with second hand cars to sell and the time and inclination to register as a supplier with you, read your specification, and submit a bid. Worse, the people selling the really good value second hand cars may be the least likely to tolerate additional costs because their profit margins wouldn’t permit it. Consequently you’re much more likely to get a good value second hand car than the NHS is to get a good value IT system.

I’ve discussed other aspects of NHS IT procurement problems previously, the market failure whereby the poor users have little or no influence over what gets bought (and forced upon them), and the near impossibility of people that lack a nuts and bolts technical understanding of technology being able to identify what’s needed in NHS IT and how much should be paid for it.

But of course NHS IT procurement guys don’t buy individual cars, they buy whole fleets of cars (not so long ago for the whole country…). Perhaps more realistic would be this; lets imagine you work in and are a shareholder of a company that has a large fleet of company cars. The guy responsible for buying the fleet of cars enjoys a few trips to America and a lot of hospitality at the expense of car company x, who happen to have great powerpoints, and becomes convinced that they represent the best value for money.

Unfortunately these cars have the special property that they’re horrible to drive and slower than normal cars. The bonnets are welded shut, the steering wheel is triangular, you get in and out through the sun roof, and they require special training to drive. While it’s easy to put stuff in the boot it’s bizarrely very hard to take it out. You could download a better cars for less off the internet and print it with your 3D printer but employees are only permitted to drive the company cars at work.

As an employee you’re now lumbered with a car that if horrible to use and wastes your time, as a shareholder this inefficiency is costing you money. Now if your job is to look after sick people, say you work in the NHS, then the inefficiency is also an opportunity cost, you now have less time and resource to heal the sick. And when it comes to changing cars that bizarre boot thing is a real pain.

In one recent NHS Hack Day project, “The ePortfolio Data Liberation Front”, a junior doctor frustrated by the NHS IT she is compelled to use teamed up with a software developer to write a tool that extracts her information from a proprietary NHS system (the NHS ePortfolio, a system doctors use to record their career progress) so she can use the software she chooses.

Sadly, the NHS ePortfolio is a good example of NHS IT procurement gone wrong, the code is kept secret for commercial reasons so we’re prevented from inspecting its quality or improving it, users do experience the product and we have a rough idea of costs (conservative estimate of at least £630,000). The expert opinion is that it’s sadly not good value for money

So what to do? A smart move for the NHS would be to ensure that those in positions of procurement influence have a solid technical grounding. Greater transparency around appointments, procurements, source code, and conflicts of interest might also help. It’s well known that marketing works, enjoying corporate hospitality leads to irrational procurement decisions and ought not to be culturally acceptable… And I’ve discussed the benefits of open source before….

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