Skip to main content

Reorganising, 1970s: The 1974 National Health Service Reorganisation and McKinsey & Company

  • Chapter
  • First Online:
Book cover Management Consultancy and the British State

Abstract

This chapter demonstrates how the reorganisation of major state bodies such as British Rail, the Bank of England, and the Atomic Energy Authority heralded the emergence of the “American generation” of consulting firms. Set against a backdrop of fears of British economic decline, the perceived superiority of American management “know-how” is demonstrated as a purported solution to Britain’s ailments. American consultancies, actively—and with considerable success—sought to build relationships with state officials through infiltrating and mimicking “elite” networks. This chapter presents the first of two detailed case studies: McKinsey & Company’s support for the 1974 NHS reorganisation. Particular focus is placed on the cross-party continuity behind the reforms, which challenges long-held assumptions regarding the adversarial nature of British politics. In addition, the peculiar geographic boundaries of the NHS—highlighted by the work of the consultants—and how they are demonstrably not coterminous with the British Isles are highlighted.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 84.99
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 109.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 109.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Notes

  1. 1.

    McKinsey & Company archive, oral history interviews (hereafter McK): Henry Strage, May 20, 1987. See Appendix 1 for biography.

  2. 2.

    Webster, The Health Services since the War, Volume II, 778–79.

  3. 3.

    Steven Jonas and David Banta, “The 1974 Reorganization of the British National Health Service: An Analysis”, Journal of Community Health 1, no. 2 (Winter 1975): 91–105.

  4. 4.

    Webster, The Health Services since the War, Volume II, 464.

  5. 5.

    The major—and largely unchallenged—interpretation of the reorganisation is ibid.

  6. 6.

    Nigel Lawson, The View from No. 11: Memoirs of a Tory Radical (London: Bantam, 1992), 613; Webster, The Health Services since the War, Volume II, 801.

  7. 7.

    See Introduction for more on definitions regarding states and state power.

  8. 8.

    For instance, in Rudolf Klein’s The New Politics of the N.H.S., Harlow, 4th edn., 2001, p. ix, he apologetically writes that a “little Englander approach” has been adopted in his analysis. However, this blind-spot has been correctly noted by John Stewart, “The National Health Service in Scotland: 1947–1974: Scottish or British?”, Historical Research 76, no.193, 2003, 389–420, David J. Hunter in “Organising for Health: The National Health Service in the United Kingdom”, Journal of Public Policy 2, no. 3, August 1982, 263–300, and H. Welsham, “Inequalities, Regions and Hospitals: The Resource Allocation Working Party”, in Sally Sheard and Martin Gorsky (eds.), Financial Medicine: The British Experience since 1750, London: Routledge, 2007, 221–241.

  9. 9.

    Barry Hedley, interview with author at Gonville and Caius College, University of Cambridge, March 18, 2011. See Appendix 1 for biography.

  10. 10.

    Marvin Bower, Perspective on McKinsey (McKinsey & Company internal publication, 1979), 92.

  11. 11.

    McKinsey & Company minutes, “Minutes of Planning Committee Meeting”, 5–6 April 1956, 7. Quoted in McKenna, The World’s Newest Profession, 172.

  12. 12.

    Bower, Perspective, 93–94.

  13. 13.

    McKinsey earnings quoted in “They cried all the way to the Bank,” The Sunday Times, 1968, exact date unknown, found in TNA: T326/1040; MCA revenues calculated by author from MCA annual returns, MCA: box 22.

  14. 14.

    “Quality Control for the Management Consultants,” Financial Times, July 18, 1966, 10.

  15. 15.

    Stephen Aris, “Super managers,” The Sunday Times, September 1, 1968.

  16. 16.

    McKenna, The World’s Newest Profession, 17–37.

  17. 17.

    Quoted in Tisdall, Agents of Change, 51; see Chap. 1.

  18. 18.

    Bower, Perspective, 95.

  19. 19.

    David Giachardi, telephone interview with author, March 9, 2011. See Appendix 1 for biography; Bernard Doyle, telephone interview with author, February 16, 2011. Doyle, however, had studied at the University of Manchester (BSc Hons) and been educated at St Bede’s College, prior to his time at Harvard.

  20. 20.

    Calculated by author from MCA: box 23.

  21. 21.

    For more on the differing interpretations of “strategy” in the 1960s, see Lawrence Freedman, Strategy: A History (Oxford: Oxford University Press, 2013), 499.

  22. 22.

    H. Igor Ansoff, Corporate Strategy. An Analytic Approach to Business Policy for Growth and Expansion (New York: McGraw-Hill Book Co., 1965).

  23. 23.

    Financial Times, July 18, 1966.

  24. 24.

    TNA: BA1/70. Mary Loughanne, initial Secretary to the Fulton Committee, “Note for the record.” Michael Simons. April 18, 1966.

  25. 25.

    The Sunday Times, March 1, 1964, 15–16.

  26. 26.

    Ibid.

  27. 27.

    “Letters to the editor,” from C.W. Bocock of Associated Industrial Consultants Ltd., The Sunday Times, March 8, 1964.

  28. 28.

    For more on the “American miracle” see Leslie Hannah, “The American Miracle, 1875–1950, and After: A View in the European Mirror”, Business and Economic History 2, no. 2 (1995): 197–220.

  29. 29.

    Jim Tomlinson, The Politics of Decline, 18; Nick Tiratsoo, “Limits of Americanisation: The United States Productivity Gospel in Britain”, in Becky Conekin, Frank Mort and Chris Waters eds., Moments of Modernity, (London: Rivers Oram Press, 1999), 112–3.

  30. 30.

    Ibid, 112.

  31. 31.

    Iron and Steel AACP Report (1952) in BOD: Macmillan papers, MS. Macmillan dep, 383.

  32. 32.

    MCA Annual Report, 1965.

  33. 33.

    Tiratsoo, “Limits of Americanisation”, 112–113.

  34. 34.

    Quoted in Tomlinson, The Politics of Decline, 74.

  35. 35.

    Jim Tomlinson, “The British “Productivity Problem” in the 1960s”, in Past & Present 175, no. 1 (2002): 194; the 1968 Brookings Institute report edited by Richard E. Caves, Britain’s Economic Prospects (London: The Brookings Institute, George Allen Unwin, 1968) summarised many of these critiques.

  36. 36.

    Quoted in Henry Strage, Milestones in Management: Essential Reader (Oxford: Blackwell, 1992), 7.

  37. 37.

    Bank of England archive (hereafter BoE): E 4/67. Paper by James Selwyn, “Management Consultants in the Bank”, 22 July 1968, 6–7.

  38. 38.

    TNA: T 326/1040. A.A. Stevens memo to D.M. Thomson, “Private and confidential.” November 5, 1968.

  39. 39.

    Cartoon by Trog (Wally Fawkes), Daily Mail, October 30, 1968.

  40. 40.

    Jenkins, Thatcher and Sons, 276–77.

  41. 41.

    Bower, Perspective, 90.

  42. 42.

    For more on this see, “McKinsey plum chokes Britain’s own consultants”, The Daily Telegraph, 30 October 1968.

  43. 43.

    Sampson, The Essential Anatomy of Britain: Democracy in Crisis, 37.

  44. 44.

    Alcon Copisarow, interview with author at the Athenaeum Club, London, February 16, 2011.

  45. 45.

    Ibid.

  46. 46.

    See TNA: FCO 2/254. “McKinsey Report on strengthening the machinery of the Government of Hong Kong,” 1973.

  47. 47.

    Alcon Copisarow, interview with author, February 16, 2011.

  48. 48.

    TNA: FCO 40/10, “Strengthening the Machinery of Government report by McKinsey & Company, Nov 1972”.

  49. 49.

    Alcon Copisarow, correspondence with author, from which was shared: Alcon Copisarow speech at Eton College on “The Bank of England: Then and Now”, December 1, 2009.

  50. 50.

    David Vincent, The Culture of Secrecy: Britain, 1832–1998 (Oxford: Oxford University Press, 1998), vi–x.

  51. 51.

    Edgerton, Warfare State, 264–266.

  52. 52.

    Alcon Charles Copisarow, Unplanned Journey (London: Jeremy Mills Publishing, 2014), 158–160.

  53. 53.

    Ibid., 178.

  54. 54.

    Financial Times, January 10, 1977, 2.

  55. 55.

    Author interview with Barry Hedley.

  56. 56.

    For a description of the report see McK: Hugh Parker, April 4, 1986. See Appendix 1 for biography.

  57. 57.

    For Castle’s praise see House of Commons debate, Bus Operators, Road Hauliers and Ports and Docks Industries (Nationalised), July 18, 1967, vol 750 cc1725–17853.

  58. 58.

    Alcon Copisarow, interview with author, February 16, 2011.

  59. 59.

    McK: Hugh Parker, oral history, April 4, 1986.

  60. 60.

    Barry Hedley, interview with author, March 18, 2011. Biography for Peter Carey in Appendix 1.

  61. 61.

    For more on Rhodes’ “hollowing-out” thesis see Dennis Kavanagh, British Politics, 5th ed., 3–63.

  62. 62.

    Geoffrey Rivett, National Health Service History, www.nhshistory.net. Accessed October 1, 2015.

  63. 63.

    Charles Webster “National Health Service Reorganisation: Learning from History”, Lecture to the Socialist Health Association, 1998.

  64. 64.

    Rudolf Klein, The New Politics of the National Health Service, 4th ed. (Harlow: Prentice Hall, 2001), 71–72.

  65. 65.

    Rodney Lowe, quoted in Andrew Denham and Mark Garnett, Keith Joseph (Chesham: Acumen, 2001), 216.

  66. 66.

    Neil Robson, “Adapting not adopting: 1958–1979. Accounting and managerial ‘reform’ in the early NHS”, Accounting, Business & Finance History, Volume 17, no.3, 2007, 445–467.

  67. 67.

    A recent witness seminar largely reasserted this view: “Witness Seminar: The 1974 NHS Reorganisation” (The University of London in Liverpool, November 9, 2016).

  68. 68.

    Klein, The New Politics, 71.

  69. 69.

    See Peter Davies, “Behind closed doors: how much power does McKinsey wield?”, British Medical Journal, 2012; 344: e2905.

  70. 70.

    See, for example, Peter Draper and Tony Smart, “Structure of the NHS,” The Times, August 9, 1972.

  71. 71.

    See, for instance, Sampson, The Essential Anatomy of Britain, 37; Heclo and Wildavsky, The Private Government of Public Money, 1–3.

  72. 72.

    For example: Kynaston, Austerity Britain, 1945–1951.

  73. 73.

    On lack of consensus in postwar British politics, see Peter Kerr, “The postwar consensus: A woozle that wasn’t?” in David Marsh et al. eds., Postwar British Politics in Perspective (Oxford: Blackwell, 1999), 66–85. For the breakdown in response to economic decline and decline of “corporatism” see Keith Middlemas, Politics in Industrial Society: The Experience of the British System since 1911 (London: Deutsch, 1980).

  74. 74.

    On the “hollowed-out state” see Kavanagh, British Politics, 53–63.

  75. 75.

    Cited in Kipping and Engwall, Management Consulting: 14.

  76. 76.

    See Saint-Martin, Building the New Managerialist State.

  77. 77.

    J.G.A. Pocock, “British History: A Plea for a New Subject”, The Journal of Modern History 47, no. 7 (1975): 601–621.

  78. 78.

    See for instance: Rodney Lowe, The Official History of the British Civil Service; Peter Hennessy, The Hidden Wiring: Unearthing the British Constitution (London: Gollancz, 1995); P. F. Clarke, Hope and Glory: Britain 1900–2000, 2nd ed. (London: Penguin, 2004). Dominic Sandbrook, for instance, writes that “I am conscious that my books betray a marked basis towards England…I am painfully aware of everything – and everybody – I have had to leave out.” Dominic Sandbrook, State of Emergency. The Way We Were: Britain, 1970–1974 (London: Allen Lane, 2010), ebook loc Preface. Accounts of devolution are an exception to this observation. See for instance Vernon Bogdanor, Devolution in the United Kingdom, New ed. (Oxford: Oxford University Press, 2001).

  79. 79.

    Burton, The Politics of Public Sector, 11; Accounts of devolution are an exception to this observation. See for instance Bogdanor, Devolution in the United Kingdom.

  80. 80.

    Ministry of Health and Scottish Home and Health Department. Report of the committee of enquiry into the cost of the National Health Service (London: HMSO, 1956); David Owen, Our NHS (London: Pan Books, 1988).

  81. 81.

    Arthur Porritt, “A Report of the Medical Services Review Committee”, British Medical Journal, 1962: 2, 1178–86.

  82. 82.

    “Administrative Practice of Hospitals Boards in Scotland”, (Edinburgh: HMSO, 1962).

  83. 83.

    Webster, The Health Services since the War, Volume II, 330; The shape of hospital management in 1980?: the report of a Joint Working Party set up by the King’s Fund and the Institute of Hospital Administrators (London: King Edward’s Hospital Fund for London and the Institute of Hospital Administrators, 1967); Ministry of Health and Scottish Home and Health Departments, Report of the Committee on Senior Nursing Staff Structure (The Salmon Report) (London: HMSO, 1966); Ministry of Health, First Report of the Joint Working Party on the Organisation of Medical Work in Hospitals (The Cogwheel Report), (London: HMSO, 1967).

  84. 84.

    See O’Hara, From Dreams to Disillusionment.

  85. 85.

    Webster, The Health Services since the War, Volume II, 336–37; For more on the role of the Chief Medical Officer in the NHS see Sally Sheard and Liam J. Donaldson, The Nation’s Doctor: The Role of the Chief Medical Officer 1855–1998 (Abingdon: Radcliffe, 2006).

  86. 86.

    Charles Webster, The National Health Service: A Political History, 2nd ed. (Oxford: Oxford University Press, 2002), 87.

  87. 87.

    Department of Health and Social Security, The Future Structure of the National Health Service (The Crossman Green Paper), (London: HMSO, 1970); David Owen, Bernie Spain, and Nigel Weaver, A Unified Health Service (Oxford: Pergamon, 1968), vii–viii.

  88. 88.

    Rivett, nhshistory.net, section on: “Rationalisation and reorganisation”.

  89. 89.

    Owen, Our NHS, 54.

  90. 90.

    Sally Sheard, The Passionate Economist: How Brian Abel-Smith Shaped Global Health and Social Welfare (Bristol: Policy Press, 2013), 246.

  91. 91.

    Ibid., 453.

  92. 92.

    Webster, The Health Services since the War, Volume II, 498.

  93. 93.

    TNA: BN 13/194. Sir Clifford Jarrett memo, February 13, 1970.

  94. 94.

    Webster, The Health Services since the War, Volume II, 497.

  95. 95.

    TNA: MH 159/383. “Assessment of a management consultancy assignment” by D Owen to F.D.K. Williams, February 7, 1974.

  96. 96.

    Ibid.

  97. 97.

    BN 13/169 “NHS Reorganisation (Conservative Administration) – Management Study”. c.1972.

  98. 98.

    Bower, Perspective, 182.

  99. 99.

    TNA: MH 159/383.

  100. 100.

    TNA: MH 159/384.

  101. 101.

    TNA: MH 159/383. “Outstanding problems to be done”. Henry Strage to Philip Rogers, July 31, 1971.

  102. 102.

    TNA: BN 13/169.

  103. 103.

    MH 159/388. “Lambeth and Southwark Fieldwork”.

  104. 104.

    MH 159/383. Henry Strage “Billing notes” to F.D.K. Williams, Assistant Secretary at DHSS. April 18, 1973.

  105. 105.

    Department of Health and Social Security, Management Arrangements for the Re-organised Health Service: The Grey Book (London: HMSO, 1972), 9–24.

  106. 106.

    Hunter, “Organising for Health: The National Health Service in the United Kingdom”, 263–300.

  107. 107.

    TNA: MH 159/383. F.D.K. Williams memo to John Archer, Head of Civil Service Department, June 15, 1971. See Appendix 1 for biography of F.D.K. Williams.

  108. 108.

    O’Hara, From Dreams to Disillusionment, 1.

  109. 109.

    Webster, The Health Services since the War, Volume II, 454.

  110. 110.

    Ibid; TNA: MH 137/427–8. “Management consultancy assignments for health minister.”

  111. 111.

    David Owen, interview with author in Mayfair, December 12, 2013.

  112. 112.

    Webster, The Health Services since the War, Volume II, 335.

  113. 113.

    Ibid., 343.

  114. 114.

    TNA: BN 13/194. Sir Clifford Jarrett memo, February 13, 1970.

  115. 115.

    See for example, E. J. Kahn, The Problem Solvers: A History of Arthur D. Little, Inc, 1st ed. (Boston: Little, Brown, 1986).

  116. 116.

    TNA: MH 159/383. F.D.K. Williams memo on March 2, 1972.

  117. 117.

    As discussed in Saint-Martin, Building the New Managerialist State.

  118. 118.

    TNA: MH 159/383. David Owen memo on January 30, 1974.

  119. 119.

    TNA: MH 159/383. “Management Study: Use of Consultants.” F.D.K. Williams memo to Mr Dodds. June 5, 1972.

  120. 120.

    TNA: BN 13/94. “Note for the record.” May 5, 1971, 4.

  121. 121.

    TNA: BN 13/194. “Civil Service Manpower.” Keith Joseph note to Edward Heath. January 6, 1971, 4.

  122. 122.

    TNA: CAB 129/158/19. “The Dispersal Review.” July 27, 1971, 2.

  123. 123.

    Peter Hennessy et al., “Routine Punctuated by Orgies,” 6–17.

  124. 124.

    Michael Shanks, “A Whitehall McKinsey,” The Times, July 24, 1970; for more on Shanks see Peter Dorey, British Conservatism and Trade Unionism, 1945–1964 (Surrey: Ashgate, 2009), 117.

  125. 125.

    “Business Diary,” The Times, June 7, 1972; “Well managed,” The Times, May 31, 1972.

  126. 126.

    MH 159/383. M.W. Joyle memo on “NHS Reorganisation.” April 28, 1971; “Sir Kenneth Stowe, civil servant – obituary,” The Telegraph, September 8, 2015.

  127. 127.

    See footnote 489.

  128. 128.

    MH 159/383. M.W. Joyle memo on “NHS Reorganisation.” April 28, 1971.

  129. 129.

    McKenna, World’s Newest Profession, 8.

  130. 130.

    New York City Municipal Archives: NYMA H36.95/su. “Starting up the New York City Health & Hospitals Corporation.” March 1970; NYMA H365.95/pas. “Providing abortion services to the poor in New York City: [memoranda to] New York City Health and Hospitals Corporation.” June 1970; NYMA H36.11/caf. “Consolidation of administrative functions: [N.Y.C] Health Services Administration.” 1970; NYMA H36.95/pib. “President’s initial briefing: [facts and figures … summarized as an aid to the President of the New York City Health and Hospitals Corporation].” July 1970.

  131. 131.

    “Bain & Company, Inc.: Growing the Business”, Harvard Business School Case Study, 28 September 1990.

  132. 132.

    The literature on the diffusion of American management techniques in the immediate postwar period is quite well-developed. See, for instance, Marie-Laure Djelic, Exporting the American Model: The Postwar Transformation of European Business (Oxford: Oxford University Press, 1998); M. Kipping and Ove Bjarnar, The Americanisation of European Business: The Marshall Plan and the Transfer of US Management Models (London: Routledge, 1998); and Jonathan Zeitlin and Gary Herrigel, Americanization and Its Limits: Reworking US Technology and Management in Postwar Europe and Japan (Oxford: Oxford University Press, 2000). De Grazia, Irresistible Empire: uses a “Market Empire” thesis to cover the postwar and late twentieth-century period. De Grazia focuses on how Hollywood, advertising, and mass commodity sales amongst other services helped to make Europe more “America-like”—though professional services are not explicitly covered in de Grazia’s work, this book indicates they certainly should be.

  133. 133.

    Tony Benn was a keen proponent of consultancy studies. In 1965, as Postmaster General, he asked that the Director General allow him to hire McKinsey to look at the “problem” of upper management structure. As he recounted in his diaries: “He [the Director General] agreed that McKinsey should be invited to look at this. This is all I wanted. But in saying this the Director General said he recognised that I was unhappy and felt that the Civil Service was obstructive.” During the study, when McKinsey discovered that staff at the clearing offices in London were not working at night as they were contracted to do so, yet getting paid as if they were, the firm was rather surprised by Benn’s reaction. As the Partner-in-Charge of the study, Roger Morrison recalled: “When Wedgewood Benn found this out, he then called in the labour unions and read them the riot act. This was a rather notable achievement given that he was probably one of the greatest allies of the labour movement in Britain. Yet he acted as though he were a chief executive with capitalistic inclinations in spite of his strong socialistic tendencies.” Despite (or perhaps even because of) Benn’s observation that McKinsey’s report on the Post Office “said practically nothing that I hadn’t said but we are paying [them] thousands of pounds a month to say it with greater authority,” he sanctioned the joint McKinsey and CPRS study and his department procured a further 11 consultancy assignments in 1975 alone. McK: Roger Morrison, oral history; Benn, Out of the wilderness, diary entry for July 28, 1965.

  134. 134.

    See Table 17.

  135. 135.

    Antony Graham, correspondence with author between February 15 and February 20, 2011.

  136. 136.

    Alan David Bacon, The Conservative Party and the Form of the National Health Service, 1964–1979, (Brunel University: Doctoral Thesis, 2002), footnote 268. See Appendix 1 for biography of Elliot Jacques.

  137. 137.

    R.S. Matthews and R.J. Maxwell, “Working in Partnership with Management Consultants”, Management Services in Government, 1974, 27–39.

  138. 138.

    Greater use of secondments was recommended in the Fulton Report. See TNA: BA 1/60, Fulton Report Vol 2, 79.

  139. 139.

    Fulton Report Vol 2, Chapter 3, 41.

  140. 140.

    Matthews, Maxwell, “Working in Partnership”, 32.

  141. 141.

    BOD: Sir Philip Rogers papers: MS. Eng c.2194. Strage’s note to Rogers, June 24, 1975. See Appendix 1 for biography.

  142. 142.

    See Appendix 1: Key characters by chapter.

  143. 143.

    McK: Henry Strage, May 20, 1987.

  144. 144.

    During 2010 to 2013, an unofficial Labour Party slogan was “You can’t trust the Tories with the NHS.” See, for instance, Mary Riddell, “The NHS is not a creaking relic, whatever the Tories may say”, The Telegraph, July 16, 2013.

  145. 145.

    Webster, The Health Services since the War, Volume II is divided in chapters by political party attitudes to the NHS, not chronology.

  146. 146.

    “Report of the Medical Services Review Committee. Summary of conclusions and recommendations”, British Medical Journal, 1178–86.

  147. 147.

    Stephen M. Shortell, Geoffrey Gibson, “The British National Health Service: Issues of reorganisation”, Health Services Research, Winter 1971.

  148. 148.

    Webster, The National Health Service, 109; ‘National Health Service Reorganisation: Consultative Document’, (London: HMSO, 1971); Peter Draper and Tony Smart, “Structure of the NHS”, The Times, 9 August 1972.

  149. 149.

    TNA: BN 13/165. Keith Joseph memo on “National Health Service Reorganisation: A Regional Tier.” September 26, 1970.

  150. 150.

    Webster, The Health Services since the War, Volume II, 344.

  151. 151.

    House of Commons debate, Budget Resolutions and Economic Situation, March 17, 1969, vol 781 cc1372.

  152. 152.

    Owen, Our Nhs, 55.

  153. 153.

    Ibid.

  154. 154.

    Sheard, The Passionate Economist, 146; ibid., 243.

  155. 155.

    Webster, The Health Services since the War, Volume II, 461.

  156. 156.

    Ibid., 462–63.

  157. 157.

    Ibid., 502–03.

  158. 158.

    TNA: MH 159/383. David Owen memo. January 30, 1974.

  159. 159.

    For the Irish Health Service Report see Towards Better Health Care: Management in the Health Boards, Vols 1–4 (McKinsey & Company, 1971); “National Health Service Reorganisation: Consultative Document”, (London: HMSO, 1971).

  160. 160.

    Webster, The Health Services since the War, Volume II, 487.

  161. 161.

    TNA: AN 124/195. “Restructuring the Railway Field Organisation,” British Rail/McKinsey & Co. report, April 1971, 4.

  162. 162.

    Webster, The Health Services since the War, Volume II, 498.

  163. 163.

    Ibid., 497.

  164. 164.

    The “Grey Book” was formally published as Management Arrangements for the Reorganised National Health Service (London: HMSO, 1972).

  165. 165.

    TNA: BN 13/167. “Membership of the Management Study.” Undated, likely 1972.

  166. 166.

    TNA: MH 159/383. “Assessment of Management Consultants Assignment.” David Owen, January 30, 1974.

  167. 167.

    TNA: MH 159/383. F.D.K. Williams memo to the CSD on “The Use of Management Consultants by Government Departments.” March 2, 1973.

  168. 168.

    Ibid.

  169. 169.

    McK: Henry Strage, May 20, 1987.

  170. 170.

    TNA: CAB128/57/8. “Cabinet Conclusions: minutes and papers.” July 29, 1975.

  171. 171.

    David Giachardi, interview with author, March 9, 2011.

  172. 172.

    Bradford University (hereafter BRAD): Barbara Castle diary notes, entry for July 29, 1975.

  173. 173.

    Gerald Kaufman, interview with author, March 8, 2011.

  174. 174.

    Ibid.

  175. 175.

    House of Commons debate, Shipbuilding (Booz-Allen Report), May 16, 1973, vol 856 cc348.

  176. 176.

    Barry Hedley, interview with author, March 18, 2011.

  177. 177.

    See for instance Daniel Guttman and Barry Willner, The Shadow Government.

  178. 178.

    BRAD: Barbara Castle diary notes, “Today was retribution day for Wedgie”, July 29, 1975.

  179. 179.

    Author interview with Barry Hedley.

  180. 180.

    Cited in Bacon, Conservative Party and NHS, footnote 153; ibid., 234.

  181. 181.

    TNA: BS 6/3511. ‘Discussion with Mr J Banham of McKinsey & Co.’ June 13, 1978, 2.

  182. 182.

    See Alfred Kieser quote, footnote 22; see also Craig and Brooks, Plundering the Public Sector; “The management consultancy scam,” The Independent, August 20, 2010; “Masters of illusion: The great management consultancy swindle,” The Independent, September 17, 2009.

  183. 183.

    Webster, The Health Services since the War, Volume II, 498.

  184. 184.

    David Owen, interview with author, London, December 12, 2013. See Appendix 1 for biography.

  185. 185.

    For more discussion on this incorrect perception, see Hunter, “Organising for Health: The National Health Service in the United Kingdom”, 263–300.

  186. 186.

    Ibid.

  187. 187.

    Ibid.

  188. 188.

    Management Arrangements for the Reorganised National Health Service in Wales (Cardiff: HMSO, 1972); Booz Allen Hamilton, An integrated Service: The Reorganisation of Health and Personal Social Services in Northern Ireland (London: HMSO, 1972).

  189. 189.

    Reorganised NHS in Wales, 2–8.

  190. 190.

    An integrated Service, 2–5.

  191. 191.

    For comments on the uniqueness of Scotland, see: John Stewart, “The National Health Service in Scotland: 1947–1974: Scottish or British?”, Historical Research 76, no.193, 2003, 389–420.

  192. 192.

    Pocock, “British History: A Plea for a New Subject”, 601–621.

  193. 193.

    For more on the similarities in the health services across the jurisdictions see N. W. Chaplin, Health Care in the United Kingdom: Its Organisation and Management (London: Kluwer Medical, 1982), 83.

  194. 194.

    Since devolution the jurisdictions have again taking differing paths of NHS reform. See NAO, Healthcare across the UK: A comparison of the NHS in England, Scotland, Wales and Northern Ireland (London: HMSO), June 2012.

  195. 195.

    TNA: MH 159/383. Memo from F.D.K. Williams on May 23, 1972.

  196. 196.

    Davies, “Behind Closed Doors”, BMJ, 2012.

  197. 197.

    See Saint-Martin, Building the New Managerialist State.

  198. 198.

    TNA: MH 159/383. M.W. Joyle memo on April 29, 1971.

  199. 199.

    TNA: MH 159/383. R. Gedling memo to Sir Philip Rogers, “Continued Employment of McKinsey & Co.” May 25, 1972.

  200. 200.

    TNA: MH 159/383. Memo from F.D.K. Williams on May 23, 1972; and TNA: MH159/393. Memo from Beyfield on May 25, 1972.

  201. 201.

    TNA: MH 159/383. Memo from J.P. Dodd. June 6, 1972.

  202. 202.

    TNA: MH 159/383. R. S. Swift memo confirming McKinsey appointment. December 18, 1970.

  203. 203.

    Vincent, Culture of Secrecy, 42; ibid., 135.

  204. 204.

    Webster, The National Health Service, 110.

  205. 205.

    Michael E. Porter, Competitive Strategy: Techniques for Analyzing Industries and Competitors (New York: Free Press, 1980).

  206. 206.

    TNA: BS 6/3511. “Discussion with Mr J Banham of McKinseys (sic.) & Co. Inc.” June 13, 1978.

  207. 207.

    For reactions see Webster, The Health Services since the War, Volume II, 574.

  208. 208.

    McK: Henry Strage, May 20, 1987.

  209. 209.

    Rob Maxwell, Healthcare: The Growing Dilemma (McKinsey & Company, 1972); Hansard, HoC debate, July 29, 1972, vol 878 cc 123–51.

  210. 210.

    Davies, “Behind closed doors”, BMJ, 2012.

  211. 211.

    Ibid.

Author information

Authors and Affiliations

Authors

Rights and permissions

Reprints and permissions

Copyright information

© 2019 The Author(s)

About this chapter

Check for updates. Verify currency and authenticity via CrossMark

Cite this chapter

Weiss, A.E. (2019). Reorganising, 1970s: The 1974 National Health Service Reorganisation and McKinsey & Company. In: Management Consultancy and the British State. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-99876-3_3

Download citation

Publish with us

Policies and ethics