National Health Service and Carbon Reductions - Case Study Example

? Sustainable Business- NHS Table of Contents Discussion 3 NHS & Carbon Reductions 3 Case Study Birmingham Heartlands & Solihull NHS Trust 4 Case Study 2: Rotherham NHS Foundation Trust 5 Case Study 3: Clinical Service Provision in terms of Specialised Services 6 Discussion NHS & Carbon Reductions As of 2008, National Health Service or NHS in UK estimated total carbon footprint of 18 million tonnes from its annual operation and the estimation was way too high than the expected outcome. In such context, NHS started arranging its financial resources, non financial resources such as human capital, infrastructure and technological resources in order to develop sustainable business models which can reduce carbon emission throughout the value chain (Gleeds, 2010). Gleeds (2010) reported that as first phase of developing sustainable business models, NHS identified potential source of carbon emission. NHS in UK found 40% raise in carbon emission its different operational activities ranging from travel, building operations and procurement in healthcare network. In such context, UK government had taken stringent measures to control activities of healthcare organizations to reduce carbon emission in operation. The UK government also wanted the emergence of an organization or association which can set examples for other players in terms of reduction of carbon footprint in the value chain. NHS found it the ideal situation to lead the sustainable business model movement and during 2008, National Health Service launched Improving Health campaign and Saving Carbon campaign. As part of the program, NHS staff, NHS itself and partners got the opportunity to consult other healthcare organizations when it comes to reducing carbon footprint in operation (Gleeds, 2010). As part of sustainable business model, NHS took holistic approach to reduce carbon emission by addressing all the six verticals such as Energy & Carbon Management, Low Carbon Travel, Transport & Access, Procurement & Food, Water usage and Building Environment. Strategic activities used by NHS in all the six verticals can be summarized in the following manner. Energy & Carbon Management- NHS started measuring carbon output per building and so as reported to customers and stakeholders. NHS implemented activity based accounting approach to measure total cost associated with whole energy cycle (Gleeds, 2010). In the workplace, NHS staff is being encouraged to decrease use of fuel fed vehicles and use of papers and perform other green habits. Procurement - more than 50% of annual NHS carbon footprints (more than 10 million tonnes) are being produced through logistics and transports of goods. In such context, NHS Purchasing and Supply Agency (PASA) established partnership with Department of Health (DH) and Sustainable Development Commission (SDC) in order implement low carbon solutions in the procurement process. NHS directed monthly transportation limit for fuel fed vehicles. As result of such strategic initiatives, NHS has been able to save ?40 million/year by reducing carbon emission throughout the supply chain by 10%. Waste Reduction- NHS incurred additional cost of ?71.2 million in 2007-2008 due to waste generated from its operation. In such context, NHS SDU and DH practices are being moderated simultaneously to reduce the amount of waste generated from operation by 40% (Gleeds, 2010). Significant amount of carbon based pollution (by CO2 and CO) caused from untreated waste (Begg, Van der Woerd and Levy, 2005; Boiral, 2006). Therefore, NHS took step for reducing waste in operation that can alternatively reduce overall carbon emission. Smith and Ward (2007), Sterling (2001) and Stern (2007) supported the fact that organizations can deploy sustainable business models based on carbon reduction formulae by integrating all the above mentioned activities such as Energy & Carbon Management, Procurement of sources, reducing waste and ensuring minimal carbon emission at transport. In the next section, the study will discuss two case studies regarding sustainable business models emphasizing Case Study 1: Birmingham Heartlands & Solihull NHS Trust NHS (2010) reported that it had helped Birmingham Heartlands & Solihull to implement combined heat and power (CHP) scheme. Actually, NHS Trust helped to Birmingham Heartlands & Solihull become self efficient in terms of electricity production and reduce dependency on carbon fed energy systems. Implementation of combined heat and power (CHP) scheme has helped Birmingham Heartlands & Solihull to generate energy from gas-powered engine and hot waters. Combination of gas-powered engine and hot waters creates the renewable energy source which can replace the use of electricity to do operations (NHS, 2010). The mentioned carbon reduction model of Birmingham Heartlands & Solihull has significant amount of symmetry with Mizuta’s (2003) approach of reducing carbon emission but Mizuta’s (2003) approach was more of theoretical one. NHS Trust advised Birmingham Heartlands & Solihull to eradicate the use of carbon fed electricity and fuel energy and replace it with CHP scheme which can develop sustainable energy network between buildings (NHS, 2010). NHS invested part of the allocated budget of ?5 million to support the mentioned carbon emission reduction strategies of Birmingham Heartlands & Solihull and successful implementation of the sustainable business model has significantly reduced overall carbon emission. Case Study 2: Rotherham NHS Foundation Trust Rotherham NHS Foundation used procurement based carbon reduction approach which is not only innovative in terms of execution but also helped the NHS Foundation Trust to reduce carbon emission from operation process in significant amount. Rotherham NHS Foundation has started using Forward Commitment Procurement (FCP) in order to reduce use of electricity and carbon fed energy throughout procurement process (NHS, 2010). The step has been taken as future outline of Trust’s ‘Future Wards’ programme which is basically extension of sustainable business model characterized with emphasis on carbon reduction. NHS (2010) reported that FCP can be used at every phase of supply chain such as decreasing freight frequency by increasing size of containers in vehicle, decreasing carbon fed energy use in the transportation, replacing petroleum fed engines with renewable energy fed engines in vehicles, decrease waste in wards etc. By deploying the mentioned green supply chain initiatives, Rotherham NHS Foundation has not only successfully implemented Forward Commitment Procurement (FCP) but also reduced cost associated with operations. Van Vuuren et al. (2007) argued that companies need to develop sustainable business model that can not only decrease green house gas emission but also satisfy the requirements of stakeholders. In both the cases of Rotherham NHS Foundation and Birmingham Heartlands & Solihull NHS Trust, patients in the hospital and general people in UK are the principal stakeholders. By deploying the sustainable business model characterized with reduction of carbon emission, NHS has not only decreased cost of operation which has the scope to reduce healthcare service fees for patients but also increased quality of life for common people in UK. Clinical Service Provision NHS Commissioning Board (2013) reported that it has increased its role beyond clinical services by establishing Clinical Reference Groups (CRGs) that can provide value to key external stakeholders of the company such as patients, organisations, patient groups and carers. As of 2013, NHS Commissioning Board or NHS CB has been formally being founded in order to provide better quality healthcare and clinical services to patients (NHS Commissioning Board, 2013). In previous years, NHS has been focusing mainly on providing financial and strategic supports to different healthcare organizations in UK and monitoring the quality of healthcare services being provided in different healthcare organizations but now the company has taken initiatives to deliver more values to stakeholders such as patients, organisations, patient groups and carers (NHS Commissioning Board, 2013). As part of restructuring the clinical service provision, NHS CB has established Clinical Commissioning Groups (CCGs) which will be responsible for commissioning the healthcare survey, set or check quality standards of existing healthcare systems in different hospitals and nursing home, provide strategic direction to health services being availed by local populations etc (NHS Commissioning Board, 2013). Under the new provision, NHS CB will be responsible to control the cost of clinical services and providing subsidized clinical services to stakeholders such as patients. NHS Commissioning Board (2013) reported that it has already taken measures to increase its presence across UK which can help patients to access the healthcare services at different part of the country. In the next section, the study will use small case study that can highlight activities of NHS to ensure better clinical services. Case Study 3: Clinical Service Provision in terms of Specialised Services In 2013, NHS CB has developed a new division known as specialised services in order to customize its services in accordance with requirements of patients. As part of specialised services, NHS offers primary care services to patients, clinical services to armed forces, offender healthcare services etc (NHS Commissioning Board, 2013). As of 2013, the specialised services is being offered under the wing of healthcare services and healthcare network consisting 27 locally based Area Teams are being used to provide the services. 40% members of locally based Area Teams are being responsible offering the specialized clinical treat to patients. For example, with the development and implementation of specialized healthcare services by NHS, patient visit and recovery rate have been drastically increased in Birmingham Heartlands & Solihull NHS Trust. Therefore, it can be said that restructuring of clinical service provision has significantly improved credibility of NHS among patients, patient groups and carers who are pertinent stakeholders for the organization. Reference List Begg, K., Van der Woerd, F. and Levy, D. L., 2005. The business of climate change: Corporate responses to kyoto. Sheffield: Greenleaf Publishing. Boiral, O., 2006. Global warming: Should companies adopt a proactive strategy? Long Range Planning, 39(3), pp. 315-330. Gleeds., 2010. Carbon Reduction and the NHS: A summary of ‘Saving Carbon, Improving Health: NHS Carbon Reduction Strategy for England. [pdf] Gleeds. Available at [Accessed 9th December 2013]. Mizuta, Y., 2003. A case study on energy saving and new energy services in Japan. Management of Environmental Quality: An International Journal, 14(2), pp. 214-220. NHS Commissioning Board., 2013. Clinical Reference Groups for Specialised Services: A Guide for Stakeholders. [pdf] NHS. Available at [Accessed 11th December 2013]. NHS., 2010. Case studies from the NHS Carbon Reduction Strategy. [pdf] NHS. Available at [Accessed 11th December 2013]. Smith, N. C. and Ward, H., 2007. Corporate social responsibility at a crossroads. Business Strategy Review, Spring, pp. 17-21. Sterling, S., 2001. Sustainable education: Re-visioning learning and change. Devon: Green Books Ltd. Stern, N., 2007. The economics of climate change: Stern review. Cambridge: Cambridge University Press. Van Vuuren, D. P., Den Elzen, M. G. J., Lucas, P. L., Eickhout, B., Strengers, B. J., Van Ruijven, B., Wonink, S. and Houdt, R. V., 2007. Stabilizing greenhouse gas concentrations at low levels: An assessment of reduction strategies and costs. Climatic Change, 81, pp. 119-159. Read More