Part 6: Lessons for public entities dealing with significant change agendas

Inquiry into Health Benefits Limited.

Ensure that programme governance and management are effective. Weaknesses in programme governance and management contributed to the inadequate and over-optimistic assessment of the position of programmes, particularly the FPSC programme. Effective programme governance and management are both essential to keeping a programme on track. Just as importantly, they enable a quick response, including making difficult decisions such as reconsidering choices or plans, when projects are not going well.

Establish a clear and efficient decision-making process, particularly when delivering multi-entity programmes. HBL relied on existing structures, such as the CEO and CFO Forums, to communicate with and secure decisions from DHBs. Establishing separate, programme-dedicated forums could have led to faster decisions and reduced programme delays.

Governance boards need good-quality information before making significant decisions and must be confident that they have enough information before making a decision to proceed with a programme. From that point, they need to provide full support for the programme, including senior-level participation and monitoring.

Integrate design and planning. FPSC work streams managed their plans independently, while co-ordinating with other work streams. There should have been more focus on having one integrated plan, which identified critical paths and dependencies. This would have facilitated making decisions when milestones were under threat and trade-offs between timeliness, costs, and benefits needed to be considered.

Adhere strictly to project control standards. Small slippages were accepted and accommodated in HBL’s plans, but eventually the co-ordination between parallel work streams could not be sustained and milestones were not achieved. Having a project management office operating effectively, and including more, smaller milestones and confidence points in the plan to enable closer monitoring of the programme, could have addressed this.

Do not underestimate the scale of change management effort required to effect sector-wide initiatives as significant as the programmes led by HBL. Programmes such as the FPSC programme have a significant technology component, but ultimately their success depends on how well the changes individual entities need to make are understood and embraced. This starts with planning and continues throughout the programme, through elements such as communication and monitoring. One aspect that appeared to hamper HBL’s progress was securing the full agreement and support of the decision-makers in DHBs, who ultimately would have to put in the work needed to make the programmes successful.

Allow enough time and emphasis for programme recruitment. HBL did not have key resources in some work streams in place early enough. Capacity planning for key resources needs constant monitoring.

Have trained staff in place and ready when starting a change programme. A corollary to the previous point is that all parties in the HBL-led change programmes needed to have staff in place with the capability to engage with the programme. Some of the DHB staff involved with the programme did not have sufficient authority to fully engage at key points, such as development of the FPSC business case.

Ensure that communication between parties is open and two way. Any change programme will struggle to achieve its objectives if all the parties do not have access to timely and reliable information. Establishing channels early on for communicating with the appropriate audience for the message to be conveyed is essential.

Ensure that sector solutions are scalable. Systems being applied across a sector need to be able to be scaled up or down to meet the different needs of different-sized entities. Smaller DHBs are unlikely to need the full range of functions that enterprise systems provide, and ideally should not be expected to pay for unneeded functionality. Equally, solutions should deliver benefits for larger entities with more demanding requirements.

Consider fully all tools, including legislative powers, available to achieve successful results. An option that was available but not requested was for the Minister to exercise powers in the Public Health and Disability Act 2000 to direct DHBs. For example, section 33A provides for the Minister to give directions in relation to administrative, support, and procurement services. This could have resolved situations where HBL had reached an impasse with one or more DHBs, acting in what they saw as the best interests of their district but causing a delay in the programme.