Book review: "Systems Thinking in the Public Sector" by John Seddon

This new book by John Seddon continues his theme from his previous one which dealt with the application of "systems" thinking to organisations. In this new book he turns his attention toward recent UK public sector reforms, which have seen some of the biggest failures in service delivery in the last few years.

One of the things I like is that Seddon puts these new reforms in the economic context of the emergence of the monetarist ideas of Milton Friedman in the Seventies. In the UK, these supplanted the Keynesian policies that had held sway for sixty years beforehand. Seddon argues that the extension of Friedman's ideas to create quasi-markets (for example in the UK's National Health Service and rail system), with their focus on achieving targets, is the root-cause of the service delivery failure.

Seddon describes "systems thinking" as an approach that considers the organisation as a whole and taking the customer view from the outside looking into the organisation. With this view in mind, the organisation is designed to respond to the customer "pulling" demand from the organisation. This contrasts with a "command-and-control" approach where the organisation "pushes" those services that it thinks that it's customers want.

Practitioners will recognise this "pulling" of demand as an approach based on Lean thinking; however, the author is critical of blindly following a particular idea without careful examination of the organisation under study. Failing to do so results in poor change implementations and these go a long way to explain why Lean has a rather poor reputation in the public sector organisations eg HMRC.

The author considers that the organisation being studied contains the all information required to make improvements - so why go looking elsewhere for "best practice"? He goes further and suggests that the term "best practice" be disparaged, as this implies a limit to improvements that can be made.

The key difference between Lean theory in manufacturing organisations compared to public sector is that manufacturing consists of reducing waste activities in repetitive, predicable tasks. In contrast, the service sector consists of more complex, human, knowledge-centred tasks involving a high degree of person-to-person interaction. Indeed, it is the end-customer that pulls value from the system. Hence, public sector organisations have to be designed so that the complexity is handled at the customer-facing part of the organisation - in Seddon's words they can "absorb variety".

The aouthor has something interesting to say about measures. In many organisations, these are set as targets for the organisation to report on. The problem with this is that the achievement of these targets dominates all other activity. As most of these measures are focused on internal activities, this usually means that the end-customer suffers from sub-optimal service. Seddon recommends that the measures *only* be used to analyse the organisation to ensure that changes are having a benefit.

He summarises the top five public-sector waste activities to remove - these may well apply to any large service corporation:

  • the cost of writing specifications for standards and targets;
  • the cost of the organisation preparing for the inspection to see if the organisation meets the standards and targets;
  • the cost of performing inspections;
  • the cost of specifications being wrong, ie attempting to comply standards and targets that were incorrect in the first place.

This last point is interesting from a systems development viewpoint, although the terminology is a little different. In systems development, the attempt to derive a complete specification up-front in one attempt is called a plan-driven or waterfall approach whereas an approach that targets improvement iteratively is known as agile.

I highly recommend this thought-provoking book with its plentiful at-the-coalface anecdote, sprinkled with gems of information that practitioners can put to immediate effect - not just in public sector organisations - but in all service industries. In fact, the author tantalisingly leaves the reader wanting more, for example in the area of supplier co-operation.

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