We were commissioned by the Trust Board through the auspices of the Director of Finance to assist the achievement of non-pay cost savings of £1,000,000 per annum.
Initially this involved the identification of those departments/areas of expenditure that would benefit from more detailed review and support, thereby maximising the return on the management and consultancy resources expended. The following areas were agreed with Trust’s Executive Team for review following our initial scoping exercise which identified these areas as having the greatest potential for releasing non-pay cost savings of approximately £1,000,000 per annum;
- Medical & Surgical Supplies
- Utilities Costs
- Rates/Lease & Rent of Premises
- Printing, Stationery, Photocopying, Print Room
- Travel, including staff travel & subsistence
- Telephones – line rentals, call costs, connections, maintenance
- Training – course fees, etc
- Laboratory Consumables
- Fuel, vehicle insurances, lease costs, transport hire
- Protheses – including plates & screws
- Cost per case beds & other subcontracted work
- Catering Provisions
- MSE – CSSD including maintenance & repairs
- Computing – Hardware/Software, support contracts, maintenance, licences
- X-Ray films, equipment, repairs & maintenance
Additionally, two other areas were included within the scope of the review, these areas showed limited potential for cost improvement, yet were under significant financial pressure;
- Appliances & Orthotics
During the course of the review, as the Trust’s financial position became clearer, the Trust requested as many options as possible to be brought forward. Our Transformation Team therefore went beyond the original scope of the project in order to develop the widest possible range of non-pay cost improvement options.
The main options for cost improvement were identified following thorough reviews of each of the above service areas. The objective of this exercise had been to identify a number of options for cost improvement within these services which were then considered by the Trust’s Cost Improvement Working Party. The volume of cost improvement options and their associated financial values afforded the Trust some true degree of choice in selecting the options to be implemented.
Having considered all of the options presented, the Trust selected an appropriate number of these options for implementation. Within the context of the Trust’s overall financial objectives a number of these cost improvement options were selected which had a total value of at least £1,000,000 per annum. Our Team presented each option in outline, together with an indication of the likely cost savings to be achieved (full year effect), implementation costs, service level/risk implications and the timescales for implementation.
Subsequently, following approval from the Trust, our Team worked with service managers and clinicians across the Trust on a range of initiatives including;
- Demand management
- Supplier negotiation
- Tendering and procurement
- Supplier standardisation
- Affordability analysis
- Cash limiting
- Adoption of alternate technologies
- Alternate procurement routes
- Collaboration with other NHS bodies
- Local sourcing
- Investing in staff to reduce non-pay expenditure.
Following a year-long implementation programme, the project concluded having delivered £1.2million of savings on a full-year effect basis.