Careful business planning is important in both private companies and public sector organisations. The largest public organisation in the UK is the NHS and after years of growing costs and variances with their budgets, the organisation is now reporting that the books are balanced (BBC, 6th June 2007). To achieve this difficult balancing act, the organisation undertook a large cost cutting exercise with over 17,000 job cuts within the last 12 months. However this has resulted in severe problems with morale and despite the cuts many departments within the NHS still remain in deficit.
In reaction to the announcement of the improved finances, Niall Dickson, of the King's Fund stated 'Do not underestimate how difficult the past 12 months must have been for health professionals on the front line'. Professor Janet Finch, of the Universities UK health and social care policy committee was less generous in her opinion. She stated: “If things continue in this way, it will be a disaster for patient care and health service morale” (BBC, 6th June 2007).
It is apparent that the improvements in the financial position of the NHS have not been easy. The Times 100 case study relating to AEGON, one of the world's largest insurance and pensions companies, explains the importance of creating a culture that enables greater acceptance of change. Will the changes taking place at the NHS become easier when the culture becomes more accepting, or are they a step too far for an over-stretched system?
NHS fears despite books balancing – BBC News, 6th June 2007
Possible Study Questions:
What is a public sector organisation?
How might the NHS management try to restore morale amongst its workforce?
Is organisational change a good thing?