Appendix X: PEST and SWOT Analysis
Appendix X: PEST and SWOT Analysis
A.
PEST ANALYSIS
A.1
POLICY AND POLITICS
A.1.1
Forces and drivers for change
Guidance from the Royal College of Surgeons of England, the Royal College of
Physicians of London, the British Association for Emergency Medicine, the Faculty of
Accident & Emergency Medicine of the Royal College of Surgeons in England and
the Academy of Medical Royal Colleges that:
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Emergency surgical services should be organised for a population of 450500,000
The provision of comprehensive elective surgical care on a stand alone basis
by a DGH is not sustainable and should be replaced by a network of hospitals
serving populations of 500-600,000
The ideal unit for fully comprehensive medicine and surgery is a hospital or
group of hospitals serving a population of 450-500,000
The lowest catchment population for ‘district hospitals’ providing 24 hour
children’s services, 24 hour surgical services and maternity services as well
as acute medicine and surgery is 250,000
‘local hospitals’ serving a population less than 250,000 are unlikely to be able
to sustain 24 hour/emergency surgery or inpatient paediatrics or consultant
led obstetrics and may have to operate a ‘selected medical take’
There should be no single handed consultants in any major subspeciality
Smaller A&E units seeing less than 40,000 new patients per annum should be
supported where they are able to demonstrate their effectiveness, safety and
quality and where they serve geographically isolated populations
The above changes will be triggered by a lack of medical manpower following
on from the introduction of the EWTD.
West Midlands SHA has identified that paediatrics, maternity, A&E and emergency
surgical services within the region are ‘challenged’ (Investing for Health Chapter 6)
DoH policy emphasising the shift towards greater levels of care being provided by
primary and community care providers or in a community setting
Growing recognition at national level that set against the advice of a range of
professional bodies and DoH policy that traditional models for the organisation and
management of local health economies are increasingly outdated and that central
government has a role in brokering the necessary structural change
DoH policy emphasising more aggressive management of chronic disease/long term
conditions
Roll out of Patient Choice
Roll out of Practice Based Commissioning
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Creation of competitive market for NHS funded healthcare (evidenced by four sets of
overlapping changes: creation of a new regulatory framework; transfer of
responsibility for service provision from government to Foundation Trusts and the
granting of private sector providers equal status with FTs; reduction in the constraints
on capacity (and hence competition) represented by a limited supply of medical
staffing; empowerment of patients through Choose & Book and the introduction of a
tariff based reimbursement system for providers)
Entrance of private sector into market for NHS funded healthcare
Establishment of Foundation Trusts and acquisition by FTs of NHS Trusts unable to
demonstrate viability
Increasing regulatory burden
Policy differences between NHS England and NHS Wales
Investment by the DoH in the development of “world class” commissioning
Potential establishment of a Public Services Trust by Herefordshire PCT and
Herefordshire Council
Impact:
HHT needs to adopt a strategy based on a clear recognition and understanding of
the ‘dogbone effect’. This is the phenomenon whereby smaller secondary care
providers lose services or referrals to larger secondary/tertiary providers with the
necessary critical mass/able to meet increasingly stringent quality standards on the
one hand and to primary and community care providers on the other.
A number of services provided by HHT – specifically A&E, obstetrics, paediatrics and
emergency surgery – are vulnerable.
The management of the challenges posed by the ‘dogbone effect’ and the
vulnerability of core DGH services needs to be put in the context of the introduction
of a market for NHS funded healthcare characterised by patient choice and
competition between providers, of a recognition that changes to the traditional
structures of healthcare economies are in some instances both necessary and
desirable and of a new commissioning regime.
HHT cannot expect to be shielded from the challenges facing it. Survival as an
independent organisation is not guaranteed. The organisation needs to ‘reinvent’
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itself and develop and implement a strategy which allows it to ‘punch above its
weight’.
A.1.2
ECONOMICS
Forces and drivers for change:
Reduced levels of NHS growth 2008/9 onwards
Roll out of Payment By Results and reduced real terms income per HRG
High costs of capital
High costs of labour
Reducing costs of some new technologies
Increasing costs of drugs and therapeutics
Increasing costs of litigation
Impact:
HHT needs to put in place systems, structures and processes to support cost
containment and improved productivity
Investments made in services or infrastructure need to provide the maximum return
on investment. HHT needs to become ‘smarter’ in the way it invests in new
technologies
The costs of poor quality (and the centrality of quality in the operation of the market)
will force a more aggressive approach to the management of quality
1. SOCIETY
Forces and drivers for change:
Demography: an increase in the proportion of older people within the population, in
the absolute numbers of older people and in the numbers living alone
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Epidemiology: increased prevalence and incidence of obesity and diabetes
Increased mobility
Demand for local access to services in a rural area with a scattered population
Increasing public expectations
Immigration into Herefordshire by EU migrant workers
Continuing problems in recruiting key staff
Impact:
HHT needs to develop an overarching model of care which recognises the unique
combination of challenges posed by local demography and geography, a more
demanding ‘customer’ who is able to access other providers
HHT needs to understand and respond to the needs and wants of migrant workers
HHT needs to ensure that it is seen in the labour market as an attractive employer.
Failure to attract ‘mission critical’ staff (or failure of the education system to ensure
an adequate supply of trainees) will potentially accelerate the ‘dogbone effect’
A.1.3
TECHNOLOGY
Forces and drivers for change:
Increasing complexity of hospital care
Increased levels of subspecialisation within the traditional taxonomy of secondary
care services
Changes in clinical practice: shorter lengths of stay; increased levels of day surgery
Increased volumes of care traditionally provided by secondary care providers now
provided by primary and community care providers
Increased volumes of secondary care traditionally provided in an institutional setting
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now provided in a community setting
Increased volumes of ‘hi tech’ secondary care now being referred to tertiary care
providers
Increased use of standard care protocols
Introduction of new technologies (eg genetic technologies) resulting in therapeutic
rather than surgical interventions, delivery if ‘hi tech’ care in a ‘lo tech’ setting
Increased mobility/miniaturisation of diagnostic equipment
Continuing advances in IT
Impact:
Alongside HR, technological change will potentially accelerate the ‘dogbone effect’.
‘Technological change’ in this context includes both ‘soft’ technologies
(subspecialisation and changes in clinical practice) and ‘hard’ technologies (new
equipment).
HHT needs to support the delivery of (demonstrable) high quality care through
increased use of formal protocols and pathways
New technologies offer the potential to support decentralisation and the extension of
the HHT service portfolio
The potential benefits of current investment in IM&T needs to be maximised
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B.
SWOT ANALYSIS
B.1
STRENGTHS
Themes and supporting evidence:
THEME
EVIDENCE
Key ‘internal’ strengths
are:
New, skilled and
experienced Executive
Management Team
Self diagnosis
HHT is a small, single site
provider
2007/08 income totalled £Xm; HHT operates from the
County Hospital site in Hereford City. Although
ambulatory care is provided in community settings
across Herefordshire and Powys, these community
facilities are neither owned nor operated by HHT
Increasing expertise in
service
redesign/productivity
improvement/LEAN
LEAN has been applied to the following services ALAN
DAWSON TO NAME. The lead Clinical Systems
Engineer for the Trust has a PhD in this subject
Clinician enthusiasm for
Service Line
Reporting/decentralisation
of decision making
An increasing recognition
across the organisation
that ‘good housekeeping’
needs to be replaced by
organisational
transformation
Outputs from clinical strategy workshops
Outputs from Executive Management Team, Strategic
Forum and Great Escape meetings/events
Key ‘external’ strengths
are:
Consistent delivery of
access targets/compliance
with core Standards for
Better Health
PETER GORIN TO INSERT
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Relative efficiency
HOWARD ODDY TO INSERT (06/07 RCI of 95)
Provision of a broad range
of secondary care/DGH
services
Self diagnosis
Modern hospital
environment
High levels of ‘ownership’
of and identification with
the County Hospital
amongst local residents
Supportive local media
The ‘new’ County Hospital was opened in YEAR???
Feedback from GPs, Members, OSC, MPs and other
stakeholders
Cuttings archives/support for FT application process
Implications:
HHT has the necessary ‘ingredients’ for success
Internally, it has an effective management team, it is free of the complexities resulting
from large size or split site working, it has buy in from the clinical teams, it recognises
the need to change clinically and has the technical skills set to do this.
Externally, the Trust is able to evidence compliance with core Healthcare
Commission standards, relative efficiency, a range of services consistent with its role
as a ‘local’ District General Hospital, modern facilities, a supportive/loyal customer
base and a positive media image
B.2
WEAKNESSES
Themes and supporting evidence
THEME
EVIDENCE
Key ‘internal’
weaknesses are:
Under-appreciation of the
threat to the organisation
represented by PEST
analysis
Outputs from clinical strategy workshops
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Structure that is not ‘fit for
purpose’
Systems and processes
that are not ‘fit for purpose’
– planning, financial and
performance management
Lack of change
management
capacity/capability
Outputs from clinical strategy workshops
Self diagnosis
Self diagnosis
Poor quality operational,
clinical and planning
information; inadequate
IM&T systems
Self diagnosis
PFI financed facilities:high
fixed costs; inflexibility in
use of facilities
Treasury (October 2007) put HHT PFI charge 2008/9
£12.6m or 13.4% of 2006/7 turnover; this percentage
cited a third highest of all PFI schemes in NHS England
Historic dependency on
non-recurrent measures to
deliver financial targets
HOWARD ODDY TO INSERT…
Poor track record in the
delivery of CIPs/ failure to
deliver target CIP and
surplus in 2007/08
Limited knowledge of
profitability of individual
service lines
‘Mixed’ track record in the
recruitment and retention
of high quality staff
Lack of a market driven
business culture at the
middle management and
across the clinical teams
HOWARD ODDY TO INSERT…
JOHN HOWDEN TO INSERT…
Self diagnosis
Feedback from Birmingham and Black Country SHA on
HHT wave 3a FT application
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Historical lack of ambition
and willingness to selfpromote
Key ‘external’
weaknesses are:
Continued used of three
WWII ‘temporary’ wards
High occupancy levels
resulting from high levels
of emergency admissions
and hence a negative
impact on elective
capacity
High levels of cancelled
operations
67 ‘general and acute’ beds (30% of general and acute
bed stock) accommodated in hutted wards
Average bed occupancy level is c.98%. INSERT
LATEST PERFORMANCE DATA ON LEVELS OF
EMERGENCY ADMISSIONS AND ACTUAL V
CONTRACT ON ELECTIVE ACTIVITY
INSERT LATEST PERFORMANCE DATA
ALAN DAWSON TO INSERT…
Continuing problems in the Insert latest performance data
delivery of 18 week RTT
times
ALAN DAWSON TO INSERT…
High levels of HCAIs
Sub-optimal stroke care
Over-centralisation of
ambulatory care services
on the County Hospital
site
Inconsistency in service
quality/lack of clear quality
USP (eg faster access
times)/provision of a lower
quality service than
Gloucestershire Hospitals
NHS Foundation Trust
(HHT’s main competitor)
Outputs from clinical strategy workshops
Comparative data from Healthcare Commission website,
Dr Foster Good Hospital Guide and NHS Choices
website
Feedback from GPs
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Poor standard of customer
care to GPs
Implications:
HHT’s potential success could be compromised by a mixture of ‘internal’ and
‘external’ weaknesses.
The organisation needs to develop and execute an Organisational Development
programme which delivers an organisation that is ‘fit for purpose’ and addresses
systems, structure, strategy, skills, staff. shared values and style (ie all elements of
the McKinsey 7S model)
The Trust also needs to ensure that it engages with its customers, develops and
implements a more attractive model of care and delivers tangible improvements in
quality thus enabling it to differentiate itself from its competitors. Specifically, HHT
needs to reprovide the hutted wards, ‘protect’ the flow of elective patients, adopt a
zero-tolerance approach to infection prevention and control and ‘fill’ any gaps in
service provision
B.3
OPPORTUNITIES
Themes and supporting evidence:
THEME
EVIDENCE
Expansion into the eastern
part of central Wales
through ‘codification’ of
relationship with Powys
LHB, development of
ambulatory care services
at Llandrindod Wells
community hospital and
post ‘downgrading’ of
Nevill Hall Hospital
Market analysis
Capture of an increased
percentage of market on
the ‘borders’ between
Herefordshire,
Gloucestershire,
Worcestershire and
Shropshire
Market analysis
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Diversification eg
acquisition of PCT
provider arm services,
social care, primary care
support (diagnostics,
accommodation etc),
niche services (terminal
care, lifestyle services,
chronic disease
management etc)
Market analysis
Implications:
HHT has opportunities to expand into eastern Wales and increase its share of the
local NHS England along the ‘borders’ with Gloucestershire, Worcestershire and
Shropshire. It also has a number of opportunities to diversify.
B.4
THREATS
Themes and supporting evidence:
THEME
EVIDENCE
Relatively small size of
HHT catchment population
and vulnerability of some
services
Herefordshire’s resident population totals X; the
catchment population of Powys covered by HHT totals Y
Failure of commissioners
to articulate clear strategy
for local health
economy/economies
Lack of up-to-date commissioning strategies which
inform LDP negotiations
Cost pressures resulting
from lack of critical mass
and operation in a tariff
based market
The report of the Academy of Royal Colleges ‘Acute
health care services – report of a working party’
(September 2007) and WMSHA’s strategic framework
‘Investing for Health’ (September 2007) identified
paediatrics, obstetrics, A&E and emergency surgery as
potentially vulnerable
The replacement of a ‘cost = price’ system with a fixed
tariff based system has resulted in HHT being exposed
to a range of cost pressures in services which the costs
of delivering a safe/high quality service exceed tariff
based income
Higher co-morbidity of an
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older catchment
population resulting in
higher costs potentially
exceeding tariff income
Ineffective joint working
across the Herefordshire
health and social care
system resulting in HHT
effectively crosssubsidising provider
agencies
Lack of political support
within NHS Wales for use
of English provider
Patient Choice,
commissioner preferences
and competition from local
private sector and
Gloucestershire NHS
competitors resulting in
reduced market share
along the ‘borderlands’
and within HHT’s ‘core’
catchment area
Age profile of HHT’s catchment population and patient
workload
Distance from optimum ALOS and day surgery rates
Historical financial performance of HHT
Insert latest data on delayed discharges and n:f/up
ratios (versus PCT target of 1:1)and inappropriate
referrals
+MARTIN WOODFORD TO INSERT…
Market analysis
Establishment of an
aggressive community
service provider able to
‘cherrypick’ lo tech
outreach and/or diagnostic
work
Market analysis
Development by Practice
Based Commissioning
Groups of primary care
based alternatives to HHT
services
Market analysis
Implications:
HHT’s potential expansion could be compromised by the loss of vulnerable services
and a combination of issues relating to critical mass, the increased costs associated
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with delivering services to a small catchment population in a rural setting and the
overall effectiveness of the local health and social care system
The Trust’s main commissioners have yet to confirm their strategic intentions. The
new administration in Wales has signalled that it wishes to minimise/terminate the
use of English providers.
The organisation is vulnerable to competition from Gloucestershire Hospitals NHS
Foundation Trust, new market entrants able to ‘cherrypick’ lo tech cases and the
transfer of care from a hospital into a primary care setting.
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