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Turnaround at UCLH: A hospital in intensive care case (A) and (B)

By Anita Devlin, Cheerag Shirodaria, Michael Jacobides, Renate Verheul


University College London Hospital NHS Foundation Trust (UCLH) is a major London teaching hospital. It encountered serious financial problems as a result of the consolidation of two separate hospitals into one new hospital building, coupled with a change in the remuneration system for NHS hospitals. The turnaround took place between April 2005 and May 2007. Pelham Allen was appointed Turnaround Director by the NHS regulator to implement a recovery plan that stabilized the situation and laid the foundations for long-term operational and financial success. This case gives the reader a close-up view of one of the largest, most sensitive and most successful UK public sector turnarounds in recent years, and highlights the similarities with, and differences from, private sector turnarounds. The case also examines the different approaches that turnaround managers can take to embed change when in a position of influence.

Learning objectives

  1. Understand the basic history and aims of the UK National Health Service.
  2. Understand key concepts surrounding the crisis: Foundation Trusts, the role of Monitor (the regulator) in the NHS, PFI, and “Payment by Results”
  3. Appreciate the not-for-profit business model and the incentives involved in it, and how these might have changed as a result of shifts in healthcare-related public policy.
  4. Understand the position of UCLH – the reputation of the institution, its flagship political status, and the high visibility of the crisis.
  5. Understand the complications associated with relocating a complex organization such as a hospital and how to anticipate the reduction in productivity (and therefore revenue) that results. This can be extrapolated to relocating any large organisation.
  6. Understand the importance of stakeholder management. Running a successful project requires a high degree of stakeholder management. As a turnaround manager you should realize who your stakeholders are. One needs to identify anyone who has an interest in your project or will be affected by its output. It is important to understand the values and issues that stakeholders have in order to address them and develop a common purpose.


Publication Date: July 2010
LBS Case Code: CS-10-016
Subjects: , , , ,
Pages: 17
Format: pdf