Demonstrating the value of continuous improvement

Many NHS organisations are adopting a more collective approach to improvement. However, we cannot simply rely on improvement enthusiasts to lead this work.

That is why NHS Impact was launched in April 2023, to help healthcare providers to shape their strategy and share best practice to drive improvement across the system.

As David Fillingham, Chair of the National Improvement Board, wrote at the time: “We need staff at every level to see the benefits in their daily work. We need the boards of organisations to put time and effort into leading this change.

“We need not just the medical, nursing, and HR directors to be involved, but chairs and non-executives, chief executives, finance directors, and chief operating officers too.”

One way to secure and sustain wider engagement is to demonstrate the benefits that continuous improvement can yield.

Demonstrating the value of the continuous improvement process

However, measuring the value of continuous improvement in the NHS remains a challenge, as it does for health systems in other countries and for leadership teams in other sectors.

Continuous improvement, successfully implemented, can deliver benefits in terms of the quality and safety of care

We might see this as delivering social value. It might also result in improvements in productivity by freeing up resources, sometimes within the organisation that has delivered the improvement, but often in another part of the system of care. We can see this as making an economic case for improvement.

On occasion the improvement initiative delivers economic benefits for the organisation or unit that has delivered the improvement. We can see this as creating a business case for that improvement, as the costs of the improvement initiative can be directly recouped by that part of the organisation.

Leaders planning an improvement strategy need to balance these different cases. Yet they are seldom given equal prominence. Evidence shows that organisations are more likely to frame the benefits in terms of social value.

Meanwhile, economic value and return on investment tend to be underrepresented in such assessments. Our evaluation of the five-year partnership between NHS trusts and the Virginia Mason Institute, aimed at advancing continuous improvement, found that any questions about delivering ‘value for money’ had been deliberately excluded from the initial objectives for fear that it could alienate frontline workers whose contribution was pivotal to successful improvement.

This poses a problem. Tensions may arise between these social and economic lenses and, if leaders focus too much on one to the detriment of the other, there are likely to be negative consequences.

Balancing quality improvement with the bottom line

Focus too tightly on the social lens and there is a risk that costs will rise as we don’t understand the economic impact of our choices and do not actively “harvest” the value. In addition to this, continuous improvement is unlikely to succeed if it doesn’t have financial measures that fit with other activities across the organisation.

Unfortunately, there is evidence that even if the social and economic benefits to the system as a whole look compelling, an organisation will only invest in improvement if they also see a positive business case for their own organisation.

Equally, if an organisation focuses excessively on economic measures, staff may become less motivated to participate as they perceive it to be a cost improvement programme. In this case, continuous improvement may lose its effectiveness. We need to create an explicit case for measuring both the social and economic value delivered by continuous improvement.

In order to better understand and overcome these challenges, Warwick Business School and NHS Horizons convened two roundtable events in September 2023. These brought together 150 leaders from clinical, operational, finance, and improvement teams across the NHS.

There were presentations on the Engagement Value Outcome (EVO) approach piloted by One NHS Finance, the return-on-investment framework used by East London NHS Foundation Trust, and models for resource utilisation develop by St Vincent’s, a large healthcare provider in Australia.

We also asked attendees three questions:

How can we make the economic case as strongly as the social and business case for continuous improvement?

What approach could be developed to help organisations evidence the value of their continuous improvement activity through all three lenses?

Why leaders should discuss the cost savings from continuous improvement

How can we demonstrate both the value and return on investment of continuous improvement in NHS operational currency?

The overwhelming majority of leaders who attended our roundtable discussions agreed that we should discuss value and many reported that they already do so.

However, some admitted that they did not want to openly discuss value because “traditional cost improvement programmes have stripped things to the bone” and “if finance is the only driver, nothing will succeed”.

More frequently, leaders shared concerns that engaging clinical teams in discussions about economic value would be challenging because, “clinicians switch off when money is mentioned” and that frontline staff who were already “firefighting” had little time to discuss value-based care.

Making the case for long-term improvement efforts

There are a number of challenges when putting forward an economic case for continuous improvement. These include:

• The fact that most improvement projects are small ‘tests of change’ on a care pathway which contribute to larger step changes.
• Tension between the pressure for short term savings and the fact that the economic value of implementing continuous improvement takes longer to realise.
• Commissioning levers lacking the nuance to recognise and reward continuous improvement.
• The fact that the economic value is not always derived in the form of direct savings. More often it releases capacity in terms of beds, equipment, and clinical time. How organisations decide to reinvest this capacity will impact on the overall benefit.

Overcoming these challenges may not be easy, but it can be rewarding.

Showing how continuous improvement can reduce waste

During our evaluation of the NHS partnership with the Virginia Mason Institute (VMI), we analysed a “waste reduction” programme developed by Leeds Teaching Hospital NHS Trust.

The programme tracked improvements which reduced or eradicated activity that added no value. This allowed the finance team to estimate the economic benefits of improvements in reduced costs or freed up capacity, enabling the Trust to conduct addition work with the same resources.

The finance team were able to attribute some of this reduction in waste to the Trust’s involvement in the VMI partnership. Our evaluation team then worked with the Trust to establish the annual costs of this involvement (including indirect costs such as time that staff spent on training and programme management responsibilities) and calculate the economic value.

During 2019, the last year before the Covid-19 pandemic, the estimated return was £15.41 for every £1 the Trust invested in the project. This has significant implications.

Some leaders at our roundtable events admitted that the lack of better methods to capture economic value made it difficult for them to secure and sustain investment in, and commitment to, continuous improvement programmes. If they had the tools to demonstrate such a healthy return, they could better justify their investment in continuous improvement projects.

The majority of attendees said they would welcome the development and adoption of a framework to assess the value of continuous improvement.

A framework for creating a culture of improvement

This would have several advantages. Continuous improvement is most effective when it is baked into an organisation’s strategic priorities. That is easier to achieve if organisations have a shared understanding of the value of continuous improvement and a framework to measure it.

Clinicians on the frontline also struggle to free up time to lead continuous improvement programmes. A clear framework would help them to make a credible case for the support they need.

Last but not least, a standardised framework would address the wide variation in how the value of continuous improvement is defined and demonstrated across the NHS. This variation can make it tricky to give policymakers and decision-makers, who have resources to invest in continuous improvement, an overall picture of what works and why.

Using the outcome of the roundtable sessions, we created a theory of change that identified four recommendations for creating that framework.

1 Develop economic value as a core component within NHS Impact and in healthcare organisations.

2 Create a task and finish group with volunteer NHS trusts to co-develop and test ways of defining and demonstrating this lens on value. This could include engaging finance leaders as champions of continuous improvement.

3 Build this work into an aligned approach to quality management. For example, we could shine a spotlight on clinicians who use the economic lens as well as the social lens.

4 Focus as strongly on how we achieve change (engagement, co-production etc) as we do on what change we are targeting (methodologies and frameworks).

If we want continuous improvement to become fully operationalised, our definition of value must include financial measures that fit with other activities, as well as social impact and quality.

Better capturing and understanding that value will generate important insights that can inform our understanding of quality and consistently meets its fundamental purpose.

The developing maturity of system level working and the adoption of NHS Impact suggest that the time is right to address this challenge.

Further reading:

Six key lessons from the NHS and the Virginia Mason Institute partnership

Measurement for performance improvement - in search of the golden thread

Hold each other to account for behaviours, not just outcomes

Why social networks are vital for continuous improvement

Bernard Crump is Professor of Practice in Healthcare and Leadership at Warwick Business School. He was previously the first CEO of the NHS Institute for Innovation and Improvement, CEO of Shropshire and Staffordshire Strategic Health Authority, and Director of Public Health in South Birmingham, was Deputy Chief Executive of Leicester Health Authority.

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