Technology suppliers play an important role for all trusts – even those with strong in-house digital teams. With the right suppliers and ways of partnering, these commercial arrangements can be beneficial for both sides. But there are always risks attached; when these relationships go wrong, it can pose a serious threat to digital delivery.
Buy the right things, in the right way
When a supplier relationship doesn't work out, it is often because the customer didn't really know what they needed during the procurement phase. This can result in organisations buying the wrong thing from the wrong supplier using the wrong contracting methods. That's why it's so important for trusts to establish – as precisely as possible – what technology they need to buy. There's a big difference between buying established technologies like cloud services or laptops and buying complex software systems that need to be customised to the needs of your organisation. Ideally, technology and purchasing decisions should be coordinated across an ICS: it's difficult to deliver joined up care across organisations with fragmented systems and poor interoperability.
Problems arise when organisations adopt a one-size-fits-all purchasing approach, especially when this approach is out-of-step with modern approaches to technology. For example, signing a fixed, multi-year contract for cloud services is probably a bad idea given the cost of cloud computing is decreasing year-on-year. Equally, adopting fixed scope contracts for complex software development projects is a recipe for disaster; building good digital services requires a user-centred, iterative approach. Fixed scope contracts prohibit this, resulting in costly 'change requests' to make the digital service fit-for-purpose and ensure it keeps pace with changing needs. It's important to understand the business model of your technology vendors, and design contracts with this in mind.
Bring together digital and commercial experts
While price is an important factor, trusts won't achieve value for money by buying an unsuitable, substandard or incompatible technology. To make smart buying decisions, you need digital and commercial experts in-house who understand both the healthcare and wider technology markets. This is essential to overcome familiarity bias; if you only consider the usual NHS technology suppliers you risk missing out on skilled small and medium sized enterprises (SMEs) or more modern, lower cost technologies used widely outside the NHS.
Beware of magic, turn-key solutions
Suppliers have a strong commercial incentive to claim that their product meets all of the trust's needs. The reality is usually less rosy; if it sounds too good to be true, it probably is. Many trusts find that in practice, even these 'off the shelf' systems require a significant amount of customisation to make them work for their needs. This kind of 'fake' off-the-shelf system can be the worst of both worlds, the amount of customisation required can negate many of the benefits of adopting an off-the-shelf system in the first place. If you know of the technology being used elsewhere in the NHS, pick up the phone to your peers and find out what they did.
Keep your options open
Supplier management doesn't end with the signing of a contract – successful partnerships require ongoing effort and strong communication. Trusts should beware of the danger of 'lock-in' to technology suppliers. Being too dependent on a single supplier can limit your commercial leverage, control and flexibility. Some level of supplier lock-in is inevitable if you're adopting a trust-wide EPR, but there are ways to mitigate. For example, you should understand how you can get data in and out of the system. What guarantees do you have about data standards? Will you need to pay the vendor more money to build integrations when you need them? How are you linking up with other trusts who are using the same supplier?
Key questions for boards:
- Do you have the in-house skills to navigate technology markets?
- Are you using the right contracting methods?
- What would happen if your relationship with an important technology supplier went wrong?
Case Study
Five reflections on the board’s strategic role in managing suppliers:
Owen Williams, chief executive of the Northern Care Alliance: you need to have a strong 'client side', and not just during the implementation period. You need to develop a mature relationship with your supplier to move beyond lengthy contract negotiations and into the collaboration space.
- Consider their business model, and how they're making money – is this through upfront costs or further down the line in terms of development and licensing? Boards need to understand life time costs.
- How does your supplier make decisions and who is authorised to make these? What is their process?
- How can your supplier help you when they don't have the answers themselves? And equally, when they want something from you, what will be the cost to the trust?
- When it is working well and agreed benefits are being realised, share the praise.
Sue Jacques, chief executive of County Durham and Darlington NHS Foundation Trust: don't under-index the time and energy you need to put into your relationship with your EPR supplier. Our colleagues at Cerner had proposed an extensive 'future state' review as part of the scoping for our new EPR. But it was me as chief executive who pushed back on this as I knew it wouldn't be realistic to carry this out with our staff who were already fully stretched. Instead, we worked out a different way to undertake this review. Our experience is that suppliers will have a certain way of working but you need to push for a tailored approach that works for your organisation.
You also need to make sure there is a good personal fit with the supplier. For example, our Cerner colleagues feel like part of the team and even bring in cakes on a Friday. This may seem trivial, but it helps build trust and collaboration. Try to hold onto good people but be prepared to ask for personnel change if the fit isn’t right.
Dr Gurprit Pannu, chief digital information officer at Sussex Partnership NHS Foundation Trust: boards should be aware of the power differential between the NHS and IT suppliers, where the latter will have more experience in terms of negotiation and deployment. For example, board leaders should understand the dynamic of being one of many customers, which will have an impact on timescales and the personnel you're allocated. Boards should be clear on their organisational leverage that can be used to manage suppliers: payment schedules, a deeper understanding of the clinical safety imperative and your influence as leaders across the health and care system.
Andy Carruthers, chief information officer at University Hospitals of Leicester NHS Trust: the board can't be across all supplier relationships. As a general rule, it is our chief executive who leads and is involved in our top two or three key IT supplier relationships, but it is me as chief information officer (CIO) who holds most of the relationships with our large suppliers. And then one level below that my senior team leaders will manage smaller suppliers. It depends on the scale and importance to the organisation. With each relationship, you need to be clear on roles and responsibilities, but crucially you need to be transparent with each other.
Caroline Clarke, chief executive at the Royal Free NHS Foundation Trust: what is your latitude as an organisation? Might it be easier to jointly procure with your neighbour or system partners? Also reach out and learn from others who have already implemented the system you're buying. Only then will you understand the functionality and its potential.