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Leadership Skills for Service Redesign 17 January 2018

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finance development consultancy

1

Leadership Skills for Service Redesign

davidbaileyfcca

• Identify the costs of redesigned

services

• Use practical planning tools

• Create process maps

• Create a mobilisation plan.

Objectives Leadership Skills for Service Redesign

Leadership Skills for Service RedesignProgramme

• Cost behaviour and structure

• Costing service changes

• Full, marginal and retained costs

• Process mapping

• Mobilisation plans.

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Cost Behaviour

Fixed Costs

• Total costs that do not change with activity

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Cost Behaviour

Variable costs

• Total costs that change in direct proportion to

changes in activity

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Cost Behaviour

Semi-Variable Costs

• Total costs with both a fixed and a variable

element

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Cost Behaviour

Stepped-Fixed Costs

• Total costs which change in steps with activity

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Cost Behaviour

• Cost

Behaviour

• The way in

which total

costs change

with activity

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Avondell v Bathpool

Unit Costs £ = Total Cost £ / Total Activity

Total Cost £ = Total Fixed Cost £ + Total Variable Cost £

Total Variable Cost £ = Unit Variable Cost £ x Total Activity

Changing the Financial Equation

Income

Total

Cost £

Activity

Expenditure

surplus

deficit

surplus

deficit

Expenditure

Income

Under Purchaser – Provider

Block ContractsUnder Payment By Results

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Cost Structure

Direct Costs

Patient Care

Indirect Costs

Overheads

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Cost Structure – Full cost

• The full cost of a service includes the direct costs of

provision and an apportionment of all the indirect

costs and overheads.

• This is absorption or full costing.

• The full cost includes a proportion of every kind of

overhead, even part of the Chief Executive's

secretary's salary.

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3

Direct Costs

• Direct costs - allocated to the activity being

costed.

• Direct costs are all those that can be directly

attributed to a particular activity or output

being measured.

Direct Costs

Overheads

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Indirect Costs

• Indirect costs - apportioned to the activity as the cost is shared over a number of areas.

• Indirect costs cannot be directly attributed to a particular cost centre but can usually be divided up between several.

• Indirect costs need to be split over the various user departments by choosing some rational basis of apportionment.

Direct Costs

Indirect Costs

Overheads

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Overhead Costs

• Overhead costs - apportioned over all activities as they are the costs of support services.

• The overhead costs of premises are the costs of support services which contribute to the general running of the hospital but cannot be directly related to the volume or quantity of activity or service provided in individual services.

Direct Costs

Indirect Costs

Overheads

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Cost Structure

Direct Costs

Patient Care

Indirect Costs

Overheads

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Full Cost v Marginal Cost

Full Cost

• The total cost of

providing a service

including all the

costs.

Marginal Costs

• The extra costs of

providing one extra

unit of service, at the

upper margin of

activity, assuming

there is spare

capacity.

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What Is A Project?

• Something which starts and ends

• … with a goal in mind.

• Constrained by time, people and money.

• Cross-functional.

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Need - Specification - Delivery

Client Needs

Specification Delivery

Dissatisfaction

WasteSpecification Error Overquality

Happy

AccidentContract

Dispute

Adequate

Delivery

Exercise

Planning a Tender Process

• Costing the service

• Designing the organisation

chart

• Researching public health

information

• Reading the Service

Specification

• Answering the tender

questions

• Researching National and

local best practice

• Completing a Mobilisation

Plan

• Designing the Service Model

• Researching the geography

• Designing the activity model

• Recosting the service

• Designing the staffing

structure

• Designing the governance

structure

• What others?

Put them in a logical order.

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Planning a Tender Process

Research

Reading the

Service

Specification

Designing the

Service Model

Designing the

activity model

Designing the

staffing

structure

Costing the

service

Completing a

mobilisation

plan

Designing the

governance

structure

Answering the

tender

questions

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Mobilisation

• Why are we bothering?

• Who do we need in our core team?

• Mobilisation session:

• Don’t write a list!

• Relationship building, ground rules and

personal goal setting

• Value divergent thoughts more than

convergent

• Jointly create a project brief

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Project Planning Technique:

Sticky Steps

• An approach to breaking down big issues

• In order to ….(verb)…

• I would have to….(verb)...

• Working backwards, Keep repeating this until

you have tasks that feel

manageable. In order to In order to In order to In order to deliver Leadership Skills for Service

Redesign I would I would I would I would have to have to have to have to develop a Sticky Steps exercise

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Precedence Diagramming Method (PDM)

• PDM network rules:

• Activities are represented by boxes

• Precedences are shown by arrows with direction

and time properties

• Precedences consist of two parts:

• A relationship :

• Finish to Start FS

• Finish to Finish FF

• Start to Start SS

• Start to Finish SF

• and a lag value – the waiting time between activities.



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PDM Logic Relationships

Finish to Start (FS) – Activity A must Finish before Activity B may Start.

The lag is usually zero. FS is the most common type.

Start to Finish (SF) – Activity A must start before Activity B may Finish.

The lag is usually greater than either activity duration.

FS is the least common type.

Activity A Activity B


PDM Logic Relationships

Finish to Finish (FF) – Activity A must Finish before Activity B may Finish.

The lag value is usually greater than zero. FF is a less common type.

Start to Start (SS) – Activity A must Start before Activity B may Start.

The lag value is usually greater than zero. SS is a less common type.



Gantt Charts

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Your task #1

Your task #2

Your task #3

Your task #4

Your task #5

Your task #6

Your task #7

Project name: My_Project Month: February, 2018

Start End

• Identify the costs of redesigned services

• Use practical planning tools

• Create process maps

• Create a mobilisation plan.

Objectives Leadership Skills for Service Redesign

Leadership Skills for Service Redesign

davidbaileyfcca

david bailey fcca€¦ · david bailey fcca [email protected] finance development...

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