NHS Benchmarking Network

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© NHS Benchmarking Network 2015

NHS Benchmarking Network

Corporate Functions Benchmarking

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Note this report should be reviewed in conjunction with the online toolkit (available to participants only) which allows comparison of individual organisation positions against other participating organisations. The Corporate Functions online toolkit can be found on the

Section 1: Executive summary 3

Section 2: Background and processes 6

Section 3:Participants 9

Section 4: Key Findings

 Payroll 14

 Management accounting 19

 Accounts payable/receivable 23

 Other financial services 28

 Audit 30

 Finance summary 33

 Procurement 35

 Human resources 42

 IM&T 52

 Medical records & clinical coding 57

 Estates & facilities 61

Section 4: Key findings (Continued…)

 Catering 70

 Occupational Health 75

 Risk management 79

 Admin support to Board Members 83

 Communications 86  Corporate improvement 88  Corporate strategy 92  Clinical Governance 95  Complaints 99  Divisional management 102

 Private & overseas patients 104

Section 5: Conclusion and next steps 107

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© NHS Benchmarking Network 2015

Section 1:

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Executive summary (1)

 The Corporate Functions benchmarking project is one of the Network’s longest running and most successful projects. Feedback from members suggests that the project is relevant due to a lack of structured corporate functions evidence being available from other sources within the NHS. The level of contributions to this year’s project confirms the ongoing interest in the work from member organisations.

 The project has been reviewed and refreshed by the project’s virtual reference group for this phase and data reporting is for the second year available online through the NHS Benchmarking Network’s website. Participants can view their position on the benchmarked metrics via the online tool accessible through the Network website members’ area: http://members.nhsbenchmarking.nhs.uk/

 The project’s data collection was expanded this year to collect greater detail for many of the areas covered. Comparisons have also moved forward to a standard structure of showing for each corporate function; services costs, productivity, and measures associated with quality and performance.

 This year over a hundred organisations registered for the project, providing a great evidence base for the report. The project uses 2013/14 year end data as the basis for analysis.

 Alarge number of metrics show very consistent results with the 2012/13 period report’s results suggesting that there has not been any significant structural changes in NHS corporate functions provision and performance between the two years.

 Throughout the report we have examined cost by using expenditure per £100m turnover. This enables members to draw comparisons between services, for example the cost of informatics is on average ten times more than the cost of payroll. This type of presentation will help executive teams and service managers focus on the most strategic and material elements of corporate functions provision. From this analysis we can conclude that Estates is the most financially material of NHS corporate functions, followed by; IM&T, Finance, and HR.

 The project provides the most comprehensive dataset available in the NHS on corporate functions and can be confidently used by members as a point of reference.

 The Corporate Functions benchmarking project is likely to return in 2016, comments from members on future iterations of the project would be welcomed..

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015

Executive summary (2)

 The results show a mixed economy of service models. All services examined showed a mixture of in-house provision and outsourced external provision. The balance has remained similar to 2012/13 with the most services showing figures only a percentage point or two difference between years.

 Members reported a mean average for the finance function as defined by the UK audit bodies of 1.3% of organisational turnover.

 The mean cost per employee for Payroll reported was £65.8 compared to £66.9 in 2012/13.

 For Accounts Payable the responses showed a mean cost of £3.29 per invoice, with two thirds of the participants reporting 90% or more invoices paid within 30 days. Average costs in Accounts Payable are reducing year on year demonstrating the impact of automation, other efficiencies, and competitive pressures.

 The median cost per internal audit day was £336 and £704 per day for external audit.

 The procurement function showed an increase in costs per £100m turnover for the second year running at £195k per £100m turnover. This increase in costs may reflect investment in this service as a route to deliver savings and a wider shift to more strategic procurement.

 The IT function showed costs that were slightly higher than in 2012/13 in all the indicators examined (cost per £100m, cost per user, cost per device) and is the second highest cost corporate support service after Estates.

 The HR cost per £100m turnover is almost identical to 2012/13 (£668k compared to £665k). Average costs per employee are £399. The mean organisational sickness rate reported was 4.3% and the staff turnover rate was 11.3%.

 The report contains new comparisons for medical records and clinical coding. At 65% of respondents, medical records are stored onsite and in 38% of cases, new medical records are fully available in electronic format.

 The Estates function shows that most members utilise a mixture of in-house and outsourced services. The report shows several metrics derived from national ERIC returns.

 The report showed new comparisons for income from private and overseas patients. These show great variation in the success of organisations in collecting this income.

 The report shows many other interesting metrics across a range of topics, for example members reported an average of 6.5 RIDDOR incidents per 1,000 employees and 33% of participating organisations do not have a designated corporate strategy team.

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Section 2:

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015

Introduction

 The NHS Benchmarking Network’s Corporate Functions benchmarking project was initiated by members as part of the 2009 work programme.

 A large number of iterations of the project have taken place with refinements to the project’s scope and data

specification taking place during this process.

Project content and process

Project Terms of Reference

 To develop a clear and agreed data specification

 To develop comparisons that benefit service departments and Trust / LHB executives

 To help fill current gaps on available comparisons

 Support realistic expectations around understanding the balance between quality standards and

achievable productivity levels

 Understand effectiveness and “what good looks like”  Understand the constraints that services operate

under

 Become a source of reference for corporate functions performance for the NHS

 To identify opportunities for improvement

 To define and share good practice

 To deliver products within agreed project timescales

 To support networking across corporate departments in member organisations. • Ideas from members • Steering Group agreement • Reference Group established • Scope agreed • Project plan Project initiation • Data specification • Validation with Reference Group • Data templates circulated • Support to members during collection Data specification and collection • Analyse data • First draft report • Issue to members • Good practice seminars • Disseminate workshop content Analysis, reporting and good practice

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Project process

 The data specification for the Network project was developed with a virtual project reference group who advised on project content. Reference group members were drawn from across the Network’s membership and represented specific functions and gave appropriate technical advice on how to benchmark each of these functional areas. The data collection template was finalised during September 2014, following active discussion with the project’s virtual reference group. The commencement of the project was initially scheduled for September 2014, however the Network Steering group delayed the start of the project to stagger the 2014/15 work programme data collections and make data collation easier for participants.

 The data collection process was facilitated through an online data collection tool with supporting definitions for each data item. The data collection period ran from December 2014 until March 2015 and was subsequently extended to April 2015 to maximise the level of involvement from

interested member organisations. Throughout the data collection process a telephone helpline service was made available to members to support a wide range of data collection queries. Advice was given to participants throughout this process to ensure consistency of interpretation and

consistency of data collection.

 An extensive data validation process was undertaken with members to ensure that findings are robust and exclude obvious outliers. Participant organisations were asked to sign off their submissions following validation work with the Network’s support team.

 Participating organisations were well represented on the project’s virtual reference group and we are grateful to participants and reference group members for their contributions in shaping the work.

 The findings of the latest phase of the project were made available through a new online benchmarking tool to view the project outputs. The online tool provides over 180 different benchmarking comparisons for participants.

 Following the initial validation process, participants were given a further period up to 30thJune 2015 to review their submissions and make any final

amendments. The online tool is now in its final form and available to view from http://members.nhsbenchmarking.nhs.uk/home.

 This report provides an overview of the national picture for NHS corporate services provision as collected from those organisations who took part in the latest phase of benchmarking.

 It is intended to carry out a further iteration of the project later in 2016 which will provide an opportunity for additional Trusts, Health Boards and commissioners to take part as well as providing an opportunity to track performance and progress from previous cycles.

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© NHS Benchmarking Network 2015

Section 3:

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Participants in the current phase of the project included

organisations from across the NHS in England and Wales. A total

of 111 organisations registered to take part in the project.

A good geographic spread was achieved with involvement from

all areas of England and Wales.

The majority of responses were submitted by provider

organisations including acute, community and mental health

services. Submissions were also received from Welsh Health

Boards, specialist organisations and CCGs

Participating organisations are listed on the following pages.

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015 5 Boroughs Partnership NHS Foundation Trust

ABM University Local Health Board Aneurin Bevan University Health Board

Barnet, Enfield & Haringey Mental Health NHS Trust Berkshire Healthcare NHS Foundation Trust

Betsi Cadwaladr University Local Health Board Birmingham Community Healthcare NHS Trust Black Country Partnership NHS Foundation Trust Bolton NHS Foundation NHS Trust

Bradford District Care NHS Trust

Bradford Teaching Hospitals NHS Foundation Trust Bromley Healthcare CIC Ltd

Buckinghamshire Healthcare NHS Trust Bury CCG

Camden & Islington Foundation Trust Cardiff & Vale University Health Board

Central & North West London NHS Foundation Trust Central London Community Healthcare NHS Trust

Central Manchester University Hospitals NHS Foundation Trust Cheshire & Wirral Partnership NHS Foundation Trust

Chesterfield Royal Hospital NHS Foundation Trust Colchester Hospital University NHS Trust

Cornwall Partnership Foundation NHS Trust Coventry & Warwickshire Partnership NHS Trust Derby Hospitals NHS Foundation Trust

Derbyshire Healthcare NHS Foundation Trust Devon Partnership NHS Trust

Doncaster & Bassetlaw Hospitals NHS Foundation Trust Dorset County Hospital NHS Foundation Trust

Dorset HealthCare University NHS Foundation Trust Dudley & Walsall Mental Health Partnership NHS Trust East Kent Hospitals University NHS Foundation Trust First Community Health and Care

Gloucestershire Care Services NHS Trust Great Western Hospitals NHS Foundation Trust

Greater Manchester West Mental Health NHS Foundation Trust Hertfordshire Community NHS Trust

Hertfordshire Partnership NHS Foundation Trust Humber NHS Foundation Trust

Hywel Dda University Health Board

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Isle of Wight NHS Trust

Kent Community Health NHS Trust Lancashire Care NHS Foundation Trust Leeds Community Healthcare NHS Trust Leeds Teaching Hospitals NHS Trust Leicestershire Partnership NHS Trust Lincolnshire Community Health Services Lincolnshire Partnership NHS Foundation Trust Liverpool CCG

Liverpool Community Health

Manchester Mental Health & Social Care Trust Mid Essex Hospital Services NHS Trust Milton Keynes Hospital NHS Foundation Trust NHS Wales Shared Services Partnership Norfolk and Suffolk Foundation NHS Trust Norfolk Community Health and Care North Bristol NHS Trust

North Cumbria University Hospitals NHS Trust North East London NHS Foundation Trust

North Middlesex University Hospital NHS Trust North Somerset Community Partnership Northampton General Hospital NHS Trust Northamptonshire Healthcare NHS Trust Northern Devon Healthcare NHS Trust Nottingham City CCG

Nottingham University Hospitals NHS Trust Oxford Health NHS Foundation Trust Pennine Care NHS Foundation Trust

Peterborough & Stamford Hospitals NHS Foundation Trust Plymouth Hospitals NHS Trust

Queen Elizabeth Hospital, King's Lynn NHS Foundation Trust Robert Jones and Agnes Hunt Orthopaedic Hospital NHS FT Royal Cornwall Hospital NHS Trust

Royal Devon and Exeter NHS Foundation Trust Royal Free London NHS Foundation Trust Royal United Hospital Bath NHS Trust Salford CCG

Salisbury NHS Foundation Trust

Sheffield Children's NHS Foundation Trust

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015 Sheffield Health & Social Care NHS Foundation Trust

Sheffield Teaching Hospitals NHS Foundation Trust Sherwood Forest Hospitals NHS Foundation Trust Shropshire Community Health NHS Trust

Solent NHS Trust Somerset CCG

Somerset Partnership NHS Foundation Trust South Devon Healthcare NHS Foundation Trust South London & Maudsley NHS Foundation Trust South Staffordshire & Shropshire MH FT

South West London and St George's Mental Health NHS FT Southend University Hospitals NHS Foundation Trust Southern Health NHS Foundation Trust

Southport & Ormskirk NHS Trust St George’s Healthcare NHS Trust

St Helens & Knowsley Teaching Hospitals NHS Trust Sussex Community NHS Trust

The Ipswich Hospital NHS Trust

The Newcastle upon Tyne Hospitals NHS Foundation Trust

The Royal Wolverhampton Hospital NHS Trust University Hospital of North Midlands NHS Trust University Hospitals Bristol NHS Foundation Trust

University Hospitals of Morecambe Bay NHS Foundation Trust West Leicestershire CCG

West London Mental Health NHS Trust Wirral Community NHS Trust

Worcestershire Acute Hospitals NHS Trust

Wrightington, Wigan and Leigh NHS Foundation Trust Wye Valley NHS Trust

Yeovil District Hospital NHS Foundation Trust

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Section 4:

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015 Of the services examined in the exercise Payroll is the most likely to be outsourced. 59% of respondents stated that their service had been outsourced, which is similar to the 60% reported last year. The transactional nature of the work allows for significant economies of scale making outsourcing a sensible option for smaller organisations. Payroll services are frequently market tested and therefore subject to competitive pressures. 35% of participants reported market testing their payroll services in the last 3-years. This suggests that many payroll tenders are let on relatively long-terms with provider stability once contracts have been let.

Payroll

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 Total costs of payroll services are shown on the left. The mean value reported is £132k per £100m turnover or 0.13% of turnover. This compares to £150k per £100m last year.

 The chart shows the cost of payroll varies significantly between organisations. The range of data is from £24k to 260k per £100m turnover.

 The drop in the mean average is primarily due to the reduction in high cost services (last year there were 8 participants with costs over £260k per £100m turnover). Given the competitive market participants with higher costs should consider market testing their service.

Payroll

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  As payroll is a service provided to

all employees, cost per employee is a particularly strong metric for this area. Cost per employee and cost per payslip are viewed as industry standard measures and are key comparators used in market testing exercises.

 This year’s mean value of £65.8 is lower than the 2012/13 value of £66.9 and the 2011/12 value of £78. This fits with the trend of general deflation of transactional costs seen across the NHS corporate services sector in recent years.

Payroll

Total payroll cost per employee per annum (incl. expenses &

superannuation) 2013/14

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 Cost per payslip is perhaps the single most commonly used metric in benchmarking payroll services and market testing competing bids in tender processes.

 The figures suggest that an average of around 13 payslips annually per employee, down from 14 payslips are produced annually per employee last year. This reflects the standardisation towards monthly payroll.

 The mean cost per payslip is £5.16 compared to £5.59 in 2012/13.  Further cost metrics and details of

payroll errors can be found on the online toolkit.

Payroll

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© NHS Benchmarking Network 2015

Section 4:

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 The mean cost of management accounting per £100m turnover is £440,000, however this metric is skewed by the mix of organisation type within the sample, as the nature of commissioners work requires proportionally a much greater level of accounting from a smaller operational cost base.  The mean costs for the following peer groups are:

o CCGs: £4.95m per £100m turnover

o Acute Trusts with community services: £225,000

o Acute Trusts without community services: £261,000

o Mental Health Trusts: £394,000

o Independent community trusts: £342,000

o Other £1.43m

 Equivalent WTE figures for the management accounting team can be viewed on the online tool.

Management Accounting

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The report cycle time is a quality

indicator reflecting the speed with which month end accounting reports (e.g. budget statements) are made available to report users. Timeliness is an important service quality indicator for the

Management Accounting function in that the provision of quick and accurate finance reports enhances the speed and quality of decision making by budget holders.  The chart shows a similar picture

to last year with a mean value of 7.3 days compared to 7.4 days in 2012/13.

 Figures for the number of general ledger journal transfers per annum can be viewed on the online tool (mean: 4,370).

Management Accounting

Report Cycle Time - total working days after period end until budget

reports are issued 2013/14

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 A mean average of 39% of management accountancy staff are professionally qualified.

 Responses range from 9.5% to 71%, which reflects that different organisations have varying approaches. Participants at either end should consider whether the balance of staff is correct, i.e. whether they have sufficient expertise and whether those with high expertise have adequate administrative support.

 This pattern of data is similar for all organisations types examined.

Management Accounting

Percentage of management accountancy staff who are professionally

qualified, 2013/14

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© NHS Benchmarking Network 2015

Section 4:

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 Accounts payable and accounts receivable are provided in-house by two thirds of participating organisations (65%), which is almost identical to 66% from 2012/13.

 Only 15% of participants had market tested the services within the last three years showing the majority of organisations do not expect to achieve significant efficiencies through outsourcing.

 Given the concerted national drive to outsource these functions following the introduction of NHS Shared Business Services (NHS SBS) it is interesting that in-house provision remains at a high level. 38% of participants reported using NHS Shared Business Services, which is just a 2% increase from the value reported in 2012/13.

Accounts Payable & Receivable

Service model, 2013/14

65%

5%

42%

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The cost of processing an accounts

payable invoice ranges from as low as £1 to as much as £10 per invoice.  The mean average cost is £3.29, which

has reduced from £3.64 in 2012/13 and £3.75 in 2011/12.

 The median average is £2.50 compared to £3.00 per invoice in 2012/13.

 Participants will be able to test their unit costs against NHS market average rates through using the online benchmarking tool.

 Equivalent Accounts Receivable figures can be seen on the online toolkit. The mean average processing cost per debtor account invoice is £15.25, this also reflects the relatively low volumes for NHS Accounts Receivable

transactions.

Accounts Payable

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 The £3.29 unit cost per invoice processed should be interpreted alongside performance on standards for speed of payment. The chart shows the Better Payments / PSPP standard values for the % invoices paid within 30 days.

 The mean value for invoices paid within 30 days is 86% which is identical to the position reported in 2012/13. Considering the reduction in the unit cost per an invoice, it is pleasing that this indicator has not been negatively effected.

 While three quarters of participants show high performance for this metric, there is a significant drop in performance within the lower quartile. The minimum value is 17%.

Accounts Payable

Accounts payable - % invoices paid within 30 days 2013/14

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  Invoices processed per employee gives a measure of

the efficiency of the transaction processing elements of the accounts payable function. There is roughly a five fold variation between organisations.

 The mean value is 12,275 invoices per WTE compared to 11,471 invoices per WTE in 2013/14.  It should be noted that the nature of the invoices may

vary between organisations and the indicator does not tell us anything about the quality or accuracy of the work performed.

 Standards from national and international

benchmarks for the Accounts Payable function use an indicative benchmark of 80 invoices paid per payables clerk per day. This provides an overall performance level of around 18,000 invoices per annum per payables clerk.

 Equivalent comparisons for Accounts Receivable can be viewed on the online tool. A mean value of 3,700 debtor account invoices processed per WTE per annum is displayed.

Accounts Payable

Invoices processed per employee in accounts payable function (WTE) per

annum 2013/14

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Section 4:

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  Participants reported a mean average

of £47k per £100m turnover for Treasury Management with a median of £28k per £100m turnover.

 Treasury Management is subject to significant diseconomies of scale with smaller organisations having much higher cost in relation to their overall turnover.

 The online toolkit also shows

comparisons for some other services:

o Participants reported managing a mean average of 216 control accounts.

o Only 1/3 of external providers reconciled their clients control accounts.

o The cost of managing charitable funds was typically 3.4% of the value of the funds.

Other Financial Services

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Section 4:

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  96% of respondents reported that

internal audit is outsourced.  The cost per internal audit day is

broadly consistent between organisations. Over 80% of organisations have a cost between £250 and £550 per day, reflecting market testing arrangements which are long established in both internal and external audit.

 The mean cost per day is £385 which is down slightly from £419 in 2012/13. The median value is £336 compared to £351 in 2012/13.

 Comparisons for both audit days per £100m turnover and audit costs per £100m turnover can be viewed on the online tool.

Audit

Internal audit cost per audit day 2013/14

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 The cost per external audit day is consistently higher than those of internal audit. In some cases this will reflect investigations requiring specialist input.

 The mean cost per day is £1,023 although this is skewed by a small number of high figures. The median average is £704 per audit day, with over half of participants’ responses falling between £500 and £1,000.

 Comparisons for both audit days per £100m turnover and audit costs per £100m turnover can be viewed on the online tool.

Audit

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© NHS Benchmarking Network 2015

Section 4:

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 This indicator was introduced in 2007 by the UK audit agencies in their publication: “Value for Money in public sector

corporate services.”

 Finance is defined as including: Financial Services, Financial and Management Accounting, Treasury Management, Fixed Asset Accounting, Charitable Funds, Financial Planning, Strategic Financial Management and Payroll & Audit.  As with management accounting, smaller

organisations without major operational divisions have costs that are much higher as a proportion of turnover.

 The mean value is 1.3% however, this is skewed by two high values. The median value of 1.06% is a more reflective indicator, which is slightly higher than the 1.00% median value reported in 2012/13.

Finance summary

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© NHS Benchmarking Network 2015

Section 4:

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70% of organisations taking part deliver their core procurement services in-house which is an identical finding to the 2012/13 project. While many corporate functions have seen increased levels of outsourcing over recent years procurement has bucked this trend, which may reflect the increased importance attached to strategic procurement and members wishing to have full control of their procurement core services. The profile of procurement has recently been raised by the Carter review and comments by the Secretary of State highlighting variation in the cost of essential equipment such as syringes, surgical gloves and toilet rolls.

Procurement

Service model 2013/14

70%

21%

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The variation shows that participants have a wide

range of service models and expertise.  Responses cover the entire spectrum of

possibilities from 0% to 100%.

 The mean value is 44.6% professional qualified staff, which is an increase of 5% from 2012/13 reported value of 39.2%.

 Procurement is recognised as being a key function in the current climate as good procurement practice can deliver significant savings and contributes to QIPP programmes. It is likely that the trend to use more professionally qualified staff will increase as the focus on procurement increases.

Procurement

Percentage of professionally qualified procurement staff compared to total

procurement staffing 2013/14

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 This chart shows the cost of the procurement function per £100m turnover.

 The mean value is £195k per £100m turnover, this is an increase from 2012/13 and 2011/12, when the values were £173k and £156k respectively.  The difference between the

2013/14 and 2012/13 values is primarily connected to the inclusion of additional smaller organisations within the project, where procurement is a greater proportion of turnover. The respective median values are £158k in 2013/14 and £154k in 2011/12 showing a similar level

Procurement

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The chart shows the total purchasing costs as a

% of the goods/services purchased. This provides an interesting view of this expenditure, the mean value is 0.94%, this value has reduced from 1.08% in 2012/13.

 This indicator is an useful figure as it can be compared to the savings that the procurement team makes on the total goods/services purchased. For most organisations the cost of the procurement function is relatively small compared to the potential savings that could be made by optimising purchasing.

 The historical spend levels on NHS procurement services has averaged around 1% of the total value of goods and services procured. This has been referenced in a number of reviews by the Audit Commission and National Audit Office and is a small percentage figure when compared to other areas of the public services (re. Cabinet Office 2010).

Procurement

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 The chart shows the % of invoices matched with a purchase order. As with the earlier charts this shows a wide range in procurement practice reflecting a lack of standardised approach.

 The mean value is 51%, this has fallen from 55% in 2012/13. This is a point of interest as previously, there had been an upwards progression from a baseline position of around 20% of invoices matched with purchase orders in 2009.

 Organisations in the lower quartile should consider whether they have sufficient control over their spending and sufficient information to inform improvements in their purchasing practices.

Procurement

Percentage of invoices matched with a purchase order 2013/14

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The findings from the proportion of purchases

made from contracts, follows the trend of significant variation in practices between organisations within this section of the project .  The mean value of purchases made from

contracts is 62%, this is slightly down from the 2012/13 reported value of 64%. This difference may be due to the variation of organisations participating in the project between years.  Good contracting is a major tool in achieving

financial savings. Organisations in the bottom quartile should consider whether they are missing opportunities to make improvements through the optimal use of contracts.

 The online tool also includes information on purchase requisitions, purchase orders and Strategic procurement activities.

Procurement

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Section 4:

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015 93% of respondents reported that their core HR services were provided within their own organisation. Outsourcing in the HR function can cover a variety of service elements including the outsourcing of transactional activities such as recruitment, alongside the infrequent full outsourcing of the HR function to external suppliers. It is important that NHS organisations’ HR services are fit for purpose delivering both the strategic and operational roles to a high standard.

Human Resources

Service model 2013/14

93%

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 The chart shows the cost of the HR function per £100m turnover. There is an almost 20-fold variation between the highest and lowest values reported.

 The mean value is £688k per £100m turnover, which matches last years value of £685k but is considerably lower than in 2011/12, when the equivalent value was £810k per £100m turnover.

Human Resources

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The chart shows the cost of the HR

function per member of staff receiving HR services.

 It might be expected that there would be a more even distribution across this measure however, this is not the case. Responses range from 87 to 2,241. The amount of strategic work undertaken by HR, the level of staff turnover and type of workforce employed will all be factors in the large variation of results.

 The mean value is £399 per staff member, this value has increased from £376 in 2013/14, however the 2014/15 result is skewed by two high outliers. Using the median value as a comparison, shows a decrease in HR costs per staff member receiving HR service from £330 to £298.

Human Resources

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 This chart shows the sickness/absence rate for participants. Responses are consistent for all participants, ranging from 3% and 6%.  Sickness rates in the NHS are

higher than UK economy averages and vary with type of organisation.  As well as the issue of loss of

working days, the indicator can also highlight issues with staff morale and resourcing as high absence rates are often connected to high levels of stress.

 The mean value sickness absence rate is 4.3%. This is inline with the

Human Resources

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The chart shows the staff turnover

rate for participating organisations.  The chart shows a significant range of

values from below 2% to almost 40%.  Much of this variation will depend on

the nature of the organisation as certain roles will be delivered on a fixed-term basis.

 High levels of staff turnover should be investigated, partially because the levels of turnover are costly and disruptive. In addition, high turnover rates can be indicative of wider problems that need to be addressed.  The mean value is 11.8% which is

similar to the 2012/13 value of 11.3%.

Human Resources

Staff turnover rate 2013/14

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 The chart shows the percentage of HR staff who provide HR advice.

 This provides some insight into the differing ways that HR teams are organised and the focus of the work they deliver. The chart shows great variation, representing the use of different business models amongst participants.

 The mean value is 35%, and responses range from 7% to 100%.

Human Resources

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The chart shows the percentage of HR

staff who are professionally qualified.  As with the percentage of HR staff who

give advice, there is wide variation in responses, ranging from 0% to 100%.  The mean value is 40% compared to 39%

in 2012/13.

 Many HR teams will undertake significant amounts of administrative work that does not need to be undertaken by HR

professionals, so it is unsurprising that few teams have entirely professionally qualified staff. Organisations in the bottom quartile however, should ensure that they have sufficient knowledge and skills available to deal with strategic and legal challenges.

Human Resources

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 This chart compares the number of employees in receipt of HR advice to the number of HR staff who give advice.

 This shows interesting variation and will reflect both productivity and differing arrangements for delivering HR.

 The mean average is 533 employees per advisor, which is almost

unchanged since 2012/13 (536 employees per advisor.)

 The median average is 452 employees per advisor (439 in 2012/13).

Human Resources

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The cost of central training &

development was collected separately to the core HR costs.

 The figures include both the cost of the central training & development teams and budgets for training courses.  The figures only include centrally held

training budgets and do not include devolved budgets.

 The average central training & development cost per staff member receiving HR service is £194. On average, one third of this cost was on external courses/training and two thirds was the cost of internal training teams.

Human Resources

Total central training & development cost per

staff member receiving HR service, 2013/14

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Section 4:

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015 78% of participants provide their core IM&T services in-house, which is down slightly from 82% in 2012/13. 35% receive some form of shared services suggesting that there are multiple models of delivery running simultaneously for different strands of work. Relatively few organisations have market tested this service, which may be due to the risk involved in losing direct control of a function that impacts so strongly on day-to-day operations. Only 22% of participants have tested the market in the last three years, which is very similar to the findings from last year (21%).

IM&T / Informatics

Service model 2013/14

78%

35%

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 The chart shows the cost of IM&T per £100m turnover. The mean value is £1,833k per £100m turnover which is slightly higher than the 2012/13 value of £1,601k per £100m.

 Responses range from £280k to over £8,000k, this wide variation may reflect variation in the types of organisation taking part.

 While many corporate functions are either self-contained or have limited impact on a daily basis, IM&T / Informatics pervades almost everything an organisation does. With this comes the capacity for great innovations and efficiencies, in addition to major setbacks if problems arise.

 Participants may wish to use the online tool to compare themselves to their peer organisation types.

IM&T / Informatics

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  Looking at the cost of the IM&T function per

user provides a different perspective.

 The mean value is £939 per user, which is an increase from the 2012/13 and 2011/12 value of £851 and £785 respectively. While there is one high outlier (due to its organisational type), reviewing the median values shows the same increasing trend. The median value for 2013/14 is £850 compared to the 2012/13 value of £782 per user.

 This suggests that there are increasing resources being put into IM&T to support factors such as; the use of additional devices and functionality, enhanced support for mobile working and touchscreen devices, wider systems interoperability requirements, and increased demand for business

intelligence services.

IM&T / Informatics

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 The mean cost of the service per device has increased to £971 from £878 in 2012/13.

 This large increase appears to be primarily due to the data being skewed by some higher values. While the median does show a slight increase, this is minimal in comparison to the difference in the mean. Median values £801 in 2013/14 and £823 in 2012/13.  The online tool also provides details of

the cost breakdown per user and the number of devices supported per WTE.

IM&T / Informatics

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© NHS Benchmarking Network 2015

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 Effective management of patient records is important in ensuring that clinicians have access to the correct information to inform patient care.

 38% of respondents reported that new medical records are fully available in electronic form.

 Medical records are currently stored onsite in 65% of cases.

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The medical records section was a new

addition to the Corporate Functions project for 2013/14.

 The mean average cost of the medical records service is £306k per £100m turnover and the median is £298k per £100m turnover.

 This level of variation may be down to variation in complexity of records and the nature of IT support, as well as type of organisation.

 The online toolkit shows the equivalent figures for WTE in the medical records team.

Medical records

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 The clinical coding section was a new addition to the Corporate Functions project for 2013/14.

 The mean average cost of the clinical coding service is £136k per £100m turnover and the median is £139k per £100m turnover. These results show that the cost of clinical coding is typically slightly below half that of the patient records service.

 The variation is likely to be influenced by the type of organisation and the size and number of different procedures

undertaken.

 The online toolkit shows the equivalent figures for WTE in the clinical coding

Clinical coding

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© NHS Benchmarking Network 2015

Section 4:

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 78% of members reported that their core estates and facilities services are provided in-house. This is an increase from 2012/13 when the value was 71%.

 Only 16% of participants had market tested their estates services in the last three years.

 Almost all (92%) of respondents confirmed that they had an estates development strategy.

 42% of participants have a major PFI scheme.

 Estates and facilities is an especially challenging area as each estate is unique and faces specific challenges. Delivery usually involves a mixture of in-house and outsourced services.

Estates and Facilities

Service model and background 2013/14

78% yes 41% yes 16% yes 92% yes 42% yes

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015

 Estates and facilities is the biggest corporate function examined in the project. The mean cost per £100m turnover for 2013/14 was £8.2m, which is down from £9.1m in 2012/13.

 The range of responses will depend on several variables such as the type of organisation, age of

properties and local issues such as PFI schemes.

 The mean total cost per bed is £43.0k compared to £63.7k in 2012/13.

 The mean total cost per employee is £4,984 compared to £5,171 in 2012/13.

Estates and Facilities

Total Hard and Soft FM cost per £100m turnover 2013/14

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 The chart shows participating organisations have greatly varying management practices for their Hard FM services.

 Three quarters of participating organisations have a mixed model buying in some services and delivering others themselves.

 8 organisations are completely

outsourced compared to only 2 who are entirely in-house.

 The mean value is 40% of Hard FM services outsourced compared to 35% in 2012/13.

Estates and Facilities

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The distribution for Soft FM services is

extremely similar to that for Hard FM displaying a complete range of responses from 0% to 100%. As with Hard FM, three quarters of participating organisations have a mixed model, buying in some services and delivering others themselves.

 The mean value of 40.1% is identical to that for Hard FM and is slightly higher than 37.1% in 2012/13.

Estates and Facilities

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 The chart shows the cost of laundry and linen services per piece of laundry.

 The majority of responses fall in the range 30p to 50p.

 The mean value reported by participants was 41p compared to 40p in 2012/13.

 As with all cost measures it is also important to consider the quality of the service

provided. The online toolkit shows that an average of 0.4% (or 4 pieces in 1,000) is returned to the laundry. This ranges from 0% to 2%.

Estates and Facilities

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The age of buildings is a significant

challenge for the NHS as older buildings may be poorly designed to deliver modern services and may be in a poor state of repair.

 The mean value reported for the percentage of buildings built since 1995 is 32.5%. This indicates that around a third of the NHS estate has been modernised.

 In the online toolkit, the percent of buildings built prior to 1948 is also available. The mean value for this indicator is 21%.

Estates and Facilities

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 Car parking is an important source of income for NHS Providers. The chart shows the average fee in pounds charged for an hour of parking.

 Half of organisations did not charge for parking facilities. The most common charge was £1 per hour. Some of this variation will reflect the location of the organisation and availability of parking.  While last year several organisations

reported charging £3 per hour, the maximum reported in 2013/14 was £2 per hour.

Estates and Facilities

Average fee charged per hour for patient/visitor parking 2013/14

TO WRITE

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  Telecommunications was a new

addition to the 2013/14 project.

 The mean cost was £183 per employee.  The responses range from £25 per

employee to over £500 per employee and values will vary depending on the type of organisation and

telecommunications technologies used.

Telecommunications

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Section 4:

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  47% of respondents have catering provided

internally with 53% using externally supplied catering (cook chill).

 This is a significant change from 2012/13 when 60% reported providing catering internally and confirms increased

momentum towards outsourcing catering services.

Catering

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 The chart shows the cost of catering per £100m turnover. The mean average is £736k per £100m turnover, this is slightly less than £763k in 2012/13. The range of values varies from under 100k to over £1,400k.

 The cost of catering per £100m will be impacted by the diverse nature of organisations within the sample. Community organisations with fewer beds will show a lower proportion of expenditure on catering.

Catering

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  Food cost per patient day shows less

variation than catering costs per £100m turnover and is perhaps a better measure for benchmarking catering costs.

 The mean value is £8.97 per patient day, with a lowest value of £3. Given the public

commentary around the quality of hospital food and the importance of appropriate nutrition for recovering patients, it is important for trusts to consider whether an appropriate balance is struck between cost and quality.

Catering

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 Food wastage is uneconomical and is also an interesting proxy indicator for quality of service.

 The mean value of food wastage on wards is 6.7%. The maximum value for this metric is at almost 20%.

Catering

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© NHS Benchmarking Network 2015

Section 4:

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 The NHS is the largest employer in the UK and many employees work in a challenging environment with a range of hazards in addition to the physical and psychological demands of being a healthcare provider. Occupational health plays a key role in ensuring a healthy and motivated workforce.

 The chart shows the cost of occupational health per £100m turnover. As with investment levels in other corporate functions a wide range in reported expenditure levels is evident.

 The mean value is £149k per £100m turnover compared to £147k in

Occupational Health

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The chart shows the cost of occupational

health per employee covered.

 For 2013/14 the mean value is £78 per employee which is the same as the value reported in 2012/13 and only a pound more than in 2011/12. These results highlights the little change in investment levels for this function over the past three years.

Occupational Health

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 It was noted in the benchmarking process that some Occupational Health services offer enhanced levels of support to staff.

 The responsibilities of Occupational Health will vary depending both on type of organisation and the specific hazards faced by the employees of the

organisation.

 The chart on the left shows the percentage of employees receiving vaccination, immunisation or serology in 2013/14.

 The mean value is 43% and the responses range from 4% to 100% showing the different profiles of these

Occupational Health

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© NHS Benchmarking Network 2015

Section 4:

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 The chart shows the cost of risk management per £100m turnover.

 The chart shows a wide variation from as low as £16k per £100m turnover to £555k per £100m turnover.

 This will reflect differing practices such as the degree to which risk management is

embedded in the organisation as part of general management, delivered by dedicated resources through a separate team or integrated with the Clinical Governance or Estates teams.

 The mean value is £166k per 100m turnover compared to £184k in 2012/13.

 The median value is £134k per 100m turnover

Risk Management

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  This phase of the project has collected

information on CNST, PES and LTPS premiums for the first time.

 The chart shows the CNST premiums per £100m turnover. The premiums vary significantly by type of organisation and participants are recommended to use the online tool to compare this against their peer groups.

Risk Management

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 The chart shows the number of RIDDOR (Reporting of Injuries, Diseases and Dangerous Occurrences Regulations) incidents per 1,000 employees. For further details see http://www.hse.gov.uk/riddor  While having a lower number of incidents is

clearly desirable, organisations with lower values should make sure that processes for reporting incidents are being followed as low values can be indicative of poor reporting practice.

 The mean value is 6.5 incidents per 1,000 employees. This is almost identical to 2012/13 when the mean was 6.4 incidents per 1,000 employees.

Risk Management

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© NHS Benchmarking Network 2015

Section 4:

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 The chart shows the cost of administrative support for the chief executive, chairman and directors per £100m turnover.

 The mean value is £98k per £100m turnover compared to £125k in 2012/13 and £113k in 2011/12. Given the range of responses, the mean is likely to respond to the change in the group of organisations being compared as well as to wider trends for reductions in the costs of support staff.

 This comparison is influenced by the use of financial size as a denominator. Smaller organisations are

disadvantaged by this methodology given that director numbers are not proportional to the financial size of the

Admin Support to Chief Executive & Directors

Total costs of A&C support for chief executive, chairman and directors per

£100m turnover 2013/14

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The chart shows the number of

executive directors at participating organisations.

 The responses range from 3 to 11 directors.

 The mean average is 6.4  The median average is 6

Admin Support to Chief Executive & Directors

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Section 4:

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The chart shows the cost of PR &

communications per £100m turnover.  The responses range from £21k to

£405k per £100m turnover. This suggests that participating organisations take very different approaches to their communications strategy.

 The mean value is £123k per £100m turnover, which is similar to the 2012/13 value of £125k per £100m turnover.

Communications

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Section 4:

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  82% of respondents replied that they had a

corporate improvement team (85% in 2012/13).

 92% of respondents replied that it was within the portfolio of an Executive Director (85% in 2012/13).

 The pie chart shows the proportions for which Director is responsible for the corporate improvement team. The most common response is the Director of Operations at 41%. After this there is a wide variety of responses with finance, nursing, business development and strategy all having a similar split (between 10% and 20%).

 These responses differ to the following pie chart showing the executive director that owns corporate strategy, suggesting the improvement and strategy teams are often entirely separate.

Corporate Improvement

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 The chart shows the WTE resource of the corporate improvement team per £100m turnover, with wide variation again evident.

 Some trusts invest in a larger, central team of change management experts, whilst others promote operational managers in taking the lead on service improvement as a core part of their role. Additional investment may also occur to target specific improvement needs.

 The mean value is 3.0 WTE per £100m turnover.  The median value is 2.5 WTE per £100m turnover.  A mean average of 25% of the team were clinicians,

however this ranges from 0 to 100%.

Corporate Improvement

Improvement team WTE per £100m turnover 2013/14

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015 Almost all (98%) participants report tangible benefits from the corporate improvement team.

These included financial (94%), quality (98%), efficiency (96%) and other (78%) benefits.

Corporate Improvement

Have benefits been identified?

98%

94% 98% 96% 78%

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Section 4:

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  Only 67% of respondents reported that

they had a corporate strategy team (63% in 2012/13).

 In 89% of cases strategy sat in the portfolio of an Executive Director (91% in 2012/13).

 The pie chart displays which Director is responsible for corporate strategy. The most common response is Director of Strategy (43%).

 The profile is different from that for corporate improvement, where the Director of Operations is most common. This suggests that in many cases the strategy and improvement teams are entirely separate.

Corporate Strategy

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 The chart shows the WTE resourcing per £100m turnover for corporate strategy teams. There is a large level of variation reported, which will not only reflect the type of organisation, but also the level of investment in a central strategy team as opposed to other models.

 The mean value is 1.3 WTE per £100m turnover, and the median value 0.9 WTE per £100m turnover. This is in the region of three times less than the size of teams recorded for improvement, which is unsurprising given the finding that almost all organisations have improvement teams, but a third do not have strategy teams.

 A mean average of 7% of the team members were clinicians however, this was focused in 20% of organisations with the remaining 80% having no clinicians on the team.

Corporate Strategy

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© NHS Benchmarking Network 2015

Section 4:

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 Clinical governance is:

“A framework through which NHS

organisations are accountable for continually improving the quality of their services and safeguarding high standards of care by

creating an environment in which excellence in clinical care will flourish”

 In many organisations this will include clinical audit, education, training and CPD and clinical effectiveness.

 The chart shows the cost of clinical governance per £100m turnover.

 The mean value is £496k per £100m turnover, which is higher than 2012/13 (£428k) and 2011/12 (£348k). This may reflect continued investment following the Francis Report.

Governance

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  Hospital acquired infections are a key

quality indicator for hospital inpatient providers. Clinical governance teams work closely with ward teams to ensure high standards of hygiene are maintained and infections minimised.

 The chart shows the number of C. difficile cases per 100 beds.

 The mean value was 3.8 cases per 100 beds during 2013/14 compared to 3.6 cases in 2012/13.

 As reported in the NHSBN Pharmacy report, national figures have shown falling rates in recent years with infection rates

approximately a quarter of those in 2007/08.

Governance

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 As indicated on the previous page, hospital acquired infections are a key quality indicator for inpatient care. MRSA is the major infection type measured in internal quality processes and an indicator that is closely monitored by regulators including the Care Quality Commission and Monitor.

 The chart shows the number of MRSA cases per 100 beds in 2013/14.

 The mean value was 0.3 cases per 100 beds, compared to 0.4 cases per bed in 2012/13.  MRSA is less frequently observed than C.

difficile and it is encouraging that over half of Trusts and Health Boards that reported zero cases in 2012/13.

 As with C. difficile, the rates have fallen in recent years with national rates approximately

Governance

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© NHS Benchmarking Network 2015

Section 4:

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 The chart shows the cost of investigation and management of complaints per £100m turnover.

 The mean value is £75k, which is higher than the mean value of £64k per £100m turnover in 2012/13.

 There is a wide range of resource levels, which will reflect both the level of complaints received and the resource put into investigating them.

 The online tool also compares the number of complaints investigated per £100m turnover, which also shows wide variation.

Complaints

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The chart shows the number of

complaints investigated per member of the complaints team.

 The mean value is 114 complaints per team member and median value is 86 complaints per team member. These are similar to the values of 111 and 81 respectively from 2012/13.

 This metric will be influenced both by productivity of the staff and how seriously complaints are examined.  Organisations interested in reviewing

their complaints performance may be interested in the joint NHSBN/Patients Association Complaints Survey:

Click here for leaflet

Complaints

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Section 4:

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  The chart shows the cost of the divisional

management teams per £100m turnover.  The mean value is £1,168k per £100m turnover.  This is higher than the 2012/13 mean value of £968k,

but similar to the 2011/12 value of £1,166k per £100m turnover.

 There are a range of different management models in place across the NHS. The project defined divisional and directorate management teams as divisional & directorate managers, clinical director funded management sessions, business manager and dedicated input by HR and Finance representatives.

Divisional & Directorate Management Teams

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Section 4:

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© NHS Benchmarking Network 2013

© NHS Benchmarking Network 2015  14% or respondents had dedicated

private facilities / beds.

 A mean average of £2,400 income was collected per private

admission.

 A mean average of 91% of private income was collected, however while 2/3rds of respondents collected almost all the related income this position reduces dramatically for the remaining Trusts.

Private & Overseas Patients

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 The number of overseas

admissions varies greatly between Trusts as it is highly sensitive to geographic and demographic factors.

 The performance of collection of overseas patient income is highly inconsistent with some Trusts collecting 100% and some practically none.

 This variation may reflect the number of overseas patients along with differences in success rates at collecting income.

Private & Overseas Patients

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© NHS Benchmarking Network 2015

Section 5:

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 We are grateful for the contributions made by the organisations who took part in this years benchmarking project.

 The main finding from this year’s Corporate Functions benchmarking is that the 2013/14 picture is similar to that of 2012/13, with many indicators returning similar results. Outsourcing levels do show some variation as do unit costs. Unit costs in many transactional functions (e.g. payroll and accounts receivable) are observed to be reducing year on year. However, other functions associated with organisational strategic direction were observed to be increasing in importance and absolute resource levels. Procurement and IM&T are both examples of areas where increasing investment levels are reported by most organisations.

 The most financially material functions remain; Estates, IM&T, Finance, and HR.

 The project provides a wealth of data for corporate functions that is not available elsewhere in the NHS. Participants are encouraged to explore the detailed comparisons available in the online toolkit.

 Tables containing the full list of indicators available on the comprehensive online tool can be found in the appendix section, along with their mean and median averages.

 The online tool allows members to view their positions on all the metrics and view the data in tabular format and also change the comparison group to review against several pre-set peer groups.

 Where questions have been asked for consecutive years comparisons for the previous exercise can also be found on the online tool by using the options button next to each chart.

 It is expected that the corporate functions project will run again in 2016.

 All participants in the exercise will be contacted for feedback and suggestions on how to enhance the next round on the project and content will be amended subject to member feedback on the most recent benchmarking cycle.

 If you have any questions or comments about any aspect of this project, please email aidan.rawlinson@nhs.netor

s.watkins@nhs.net

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© NHS Benchmarking Network 2015

Appendix:

Figure

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