Britain’s biggest police force has announced they’re considering rationing services. Local councils are restricting essential services to fund adult social care. Hospitals are rationing non-urgent care. We’re in an era of high demand for public services and reducing budgets. Doubtless some of these statements are a form of budget brinkmanship to get leverage in negotiations, but it’s worth questioning the rationing assumption.

Because, before you ration, you have an obligation to deliver service in the most efficient way possible. This is particularly true of the public sector.

Rations come in when there is too much demand and not enough supply in the system. Supply can be limited by many things. A very vivid example was in the second world war, where food supplies were heavily disrupted, so Churchill had ration books issued. But that’s rationing products. What does it mean to ration services?

The rationing instinct is kind of like salami. Imagine your budget is one big salami. Yesterday, your finance director sliced off a big chunk. In fact she’s sliced off big chunks every year for 5 years (she’s very sorry about it). Your reaction is – I have less, so I can give out less. But this is way too crude, and fundamentally misunderstands that products and services aren’t the same.

Going back to Winston Churchill once more, and one of his famous quotes: “we have run out of money so now we must think.” So let’s think.

Supply in service organisations comes in two forms. 

The first is frontline supply for service. This is policing, nursing, social care. The job of keeping us safe and well. This is where the real value exchange takes place and is genuine “service” – the thing we hire the state to do, for which we pay through tax. This is usually where rationing is being threatened.

The second type is back office supply of “customer service”. Call centres, paperwork, assessments etc. This is the job of processing the service and dealing with people who “fall off” the service. This is usually where considerable, often unseen cost lives.

Let’s break down that unseen cost

Customer service is often made up of contact you want with a customer (value demand) and contact you don’t want (failure demand). The latter is people phoning up to chase up progress, or asking for something to be better explained than it is on the website, or just reporting a service failure. In our experience, 50-70% of “customer service” demand is this second avoidable type. And that’s both the public or private sector. 

So, rather than rationing demand for service, how about rationing supply of contact? Fix the service so the requirement for expensive customer service is reduced. Unfortunately service organisations are often unconsciously fixed in a manufacturing mindset of service provision – which takes us back to the earlier point about confusing products and services. They see all customer contact as the same, and something to be processed and ‘distributed’ at minimum cost.

Public services have barely changed in 100 years. The economist estimates that a new idea takes 16 years to filter through the NHS. So perhaps it’s no surprise that people aren’t innovating. Design, and in particular service design, is a proven technique for this level of rethinking, mainly because it does three things very well: reframes problems so they can be tackled differently, reduces service failure by designing around the customer across channels, and reduces the risk of change by testing in iterations. When faced with this threat of rationing, I think Winston Churchill would have applauded a method that helps our public service leaders to rethink their way through our demand crisis.