The dynamics of commissioning across organisational and clinical boundaries.

Purpose: The purpose of the paper is to investigate the inter- and intra-organisational relationships in the commissioning of secondary care by primary care trusts in England, using a principal-agent framework.

Design/methodology/approach: The methodology is a qualitative study of three case studies. A total of 13 commissioning-related meetings were observed. In total, 21 managers and six consultant surgeons were interviewed.

Findings: There are a number of different levels at which contractual and managerial control take place. Different strengths of control at one level can affect willingness to comply with agreements at other levels. Agreements at one level do not necessarily result in appropriate or expected action at another.

Research Limitations/implications: The system for commissioning in the National Health Service (NHS) has changed with the introduction of payment by results and practice-based commissioning. However, the dynamics of the inter- and intra-organisational relationships studied remain.

Practical Implications: Incentives within organisations are as important as those between organisations. Within a chain of principal-agent relations, it is important that a strong link in the chain does not result in the exploitation of weaknesses in other links. If government targets and frameworks are to be met through commissioning, it may be advantageous to concentrate efforts on developing incentives that align clinician with NHS trust objectives as well as NHS trust with primary care trust (PCT) and government objectives.

Originality/value: This paper is based on original empirical work. It uses a principal-agent framework to understand the relationships between PCTs and NHS trusts and highlights the importance of internal NHS trust governance systems in the fulfilment of commissioning agreements.