Performance Measurement Performance Analysis System Plan Term Paper

Pages: 10 (3010 words)  ·  Style: Harvard  ·  Bibliography Sources: 2  ·  File: .docx  ·  Topic: Healthcare

Performance Measurement

Performance Analysis System Plan

The most significant goal for the healthcare organization is to provide excellent quality care for patients. However, its ability to do this relies on the ability to utilize its assets and resources to the maximum extent. Performance measurement can help to improve patient care through improved quality and positive organizational results. There are many metrics that can be used to measure the quality of patient care and organizational use of resources. The metrics chosen depend on the mission and vision of the organizations involved.

Why Engage in Performance Analysis?

Reporting and tracking performance are essential elements in the quest to improve the quality of care that patients receive. Patients are concerned are about safety and their hospital experience. Performance tracking is linked to hospital goals and missions. One must track data in order to be able to determine if goals are being met. If they are not, methods can be devised to make certain that improvements are made where they are needed the most.

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Patient care is at the top of the list, in terms of the need to assess performance criteria. However, in order to be able to deliver quality care, the hospital must also carefully track expenditures and meet financial goals as well. This proposal will present a plan to make certain that the hospital meets financial goals so that it can continue to deliver the high level of care that patients have come to expect from this facility. It will examine a benchmarking system designed to make certain that the hospital remains a vital resource for the community that it serves.

This plan will enable the hospital to make certain that it is meeting the goals that it sets for its financial success, which directly translates into better equipment, more qualified staff, and the things that it needs to provide the highest level of care possible for patients. Even in a not-for -profit organization, the ability to maintain the highest level of retained earnings ensures that the hospital will be able to provide the highest level of patient care.

TOPIC: Term Paper on Performance Measurement Performance Analysis System Plan the Assignment

The community must be assured that their local hospital can provide care in a safe and reliable atmosphere. A hospital that does not have a reliable way to track cannot make claims as to patient safety and quality. The only way to assure that the hospital meets or exceeds its goals is to engage in performance metrics. For this reason, performance measurement is the most important activity in which the hospital engages.

Stakeholder Analysis

Hospitals are a community asset, and as such, must keep the interests of a number of different stakeholders in mind. One may think that the primary stakeholder is the board of directors, or any benefactors that have an interest. However, the community represents the biggest stakeholder in the hospital network. The community depends on the hospital for its healthcare needs. The staff also has a stake in the performance of the hospital, but it is the community that has the most to gain or the most to lose from an efficiently functioning hospital.

The various stakeholders in the hospital have different interests in the outcomes of the performance-based analysis. Certain stakeholders are more interested in the financial aspects of the hospital. Others are more interested in other outcomes, such as safety and quality of care. Financial stability is the foundation of all of the other concerns of various stakeholders. Without a secure financial base, other outcomes will be difficult, if not impossible to achieve. Proper identification of various stakeholder needs will play a key role in the development of specific performance metrics to meet their needs.

The Balanced Scorecard Approach

Hospitals are involved in many different activities involving vast number of unique patients and scenarios. This complicates the ability to measure performance in such a manner as to provide a uniform quality of care. The amount of performance data that hospitals collect varies from facility to facility. Some hospitals gather extensive information, while others gather very little (National Health Foundation of California 2004). Hospitals collect performance information in three separate patient quality of care related areas: patient experience, patient safety, and quality of care (National Health Foundation of California 2004). Databases are the most common form of analysis system used to track the data.

The hospital must choose which areas to focus on in the development of performance measurement. In a hospital system, all of the systems are interconnected, making it difficult to decide which area deserve the most attention. In order to help with this dilemma, many hospitals are using the balanced scorecard method to improve their performance and productivity. The balanced scorecard system was borrowed from the manufacturing industry, but works nicely in the hospital setting as well (Walker and Dunn 2006).

This research supports the adoption of the Balanced Scorecard (BSC) as a performance measurement instrument for this facility. The BSC goes beyond short-term financial strategies and looks at organizational strategy. This research will demonstrate how the Balanced Scorecard strategy can be implemented within the organization. It will demonstrate how the BSC strategy will result in improved strategy for this healthcare facility.


The BSC was developed in the early 1990s from the idea that financial measures alone are not enough to assess complex organizations (Walker and Dunn 2006). This methodology allows the organization to operationalize their core principles, mission, and strategy. Kaplan and Norton suggest that and organization can be measured by assessing their financial health, customer relations, internal processes, and their learning/growth history (Walker and Dunn 2006). The balanced scorecard can easily be applied to the healthcare industry, but only with a few modifications to help address specific needs. There have been numerous academic articles that address the various aspects of applying the balanced scorecard method to the healthcare industry (Walker and Dunn 2006).

The hospital consists of inputs, such as supplies, staff members, equipment, services, and the facilities. Outputs include the various types of services rendered (Walker and Dunn 2006). These services are typically sub-divided by the various procedures that are rendered to patients (Walker and Dunn 2006). The efficiency of the organization can be measured by the efficiency ratios of the various inputs and outputs.

The development of hospital-specific measures depends on the ability to answer key questions about the organization's performance. The performance criteria asks if the financial performance has improved, if the patients recognize more value for their money, if services and processes have improved, and if the organization has maintained its ability to learn and improve (Walker and Dunn 2006). The following discussion will address each of these four areas in detail.

The first measure in the BSC addresses the financial health of the organization. Cost control is one of the most important and most difficult aspects of managing the healthcare industry. Costs are rising uncontrollably and organizations must improve their efficiency in their way in which resources are used. The first step in implementing BSC metrics in this organization will be to perform and audit of resources and how they are used within the organization. In order to better visualize what is happening with the organization, this information is organized into "visual dashboards" that allow analysts to see the organization's strengths and weaknesses at a glance (Walker and Dunn 2006).

The visual dashboard for a healthcare organization does not look unlike that of any other organization. The dashboard will contain items such as capital, return on assets, minimal profit margins, current ration, and working capital measurements (Walker and Dunn 2006). These are only a few of the potential metrics that will e used, but these comprise the most common ones to measure the strength of organizations.

Unlike the manufacturing industry, the health case industry must continually expend capital on new equipment. They must keep up with medical advances and techniques. In the manufacturing industry, new equipment is typically a one-time expense. Once the equipment is purchased, it typically is not replaced until it breaks beyond repair or is replaced by astonishingly new technology. The life cycle of hospital equipment is generally much shorter than that of manufacturing equipment.

Another difference between the manufacturing industry and the health care industry is how quality is measured. In the manufacturing industry, customer satisfaction is reflected in how pleased the customer is with the good or service. In the healthcare industry, quality is measured by the perception of the customer regarding the service that they received. The perceptions of the customer can be measured by several key metrics, the overall amount of patient satisfaction, the amount of patient involvement in their healthcare decisions, waiting time, and the number of complaints that are received (Walker and Dunn 2006).

The most common form of measurement for these types of factors is the patient customer service satisfaction survey. These surveys are collected upon exit of the healthcare organization. These surveys can play a valuable role the maintenance of quality services. They can be easily collected and the results entered into a database to track… [END OF PREVIEW] . . . READ MORE

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APA Style

Performance Measurement Performance Analysis System Plan.  (2008, April 30).  Retrieved November 27, 2021, from

MLA Format

"Performance Measurement Performance Analysis System Plan."  30 April 2008.  Web.  27 November 2021. <>.

Chicago Style

"Performance Measurement Performance Analysis System Plan."  April 30, 2008.  Accessed November 27, 2021.