A Balanced Scorecard in Strategic Planning of The Medical Center

Strategic Plan of the Organization

A balanced scorecard is a tool that organizations can use to focus on the future by evaluating an internal process, customer satisfaction, financial status, and growth opportunities. This must however be implemented within the strategic plan of the organization in order to achieve the intended results. Quality improvement and performance measurements are areas that have found a balanced scorecard useful in gauging the progress of an organization. The MedStar Montgomery Medical Center is a member of MedStar Health with a strategic plan to make it a leader in provision of quality medical services in the state. Thus, the use of a balanced scorecard can help to identify the areas that require sufficient attention and also identify the challenges that care is likely to be encountered in pursuit of quality improvement practices.

The purpose of the current paper is to analyze how a balanced scorecard can be used to improve quality at MedStar Montgomery Medical Center within its strategic plan.

Introduction

Businesses and organizations are expected to follow regulations and rules set by different controlling bodies in their industry. As such, they must be well versed with the terms and conditions in the industry in order to develop an effective strategy that ensures both success and adherence to the rules and regulations. This is where the issue of performance measurement becomes important to an organization as a way of gauging the success achieved. One of the tools that are mostly used to measure performance is the balanced scorecard (BSC), which ensures that proper strategy implementation and quality measurement is achieved leading to an effective decision-making process in the organization (Kaplan & Norton, 2005). By using the BSC, the management can understand the external entities that influence experiences of a business within the industry. A BSC can help to reduce challenges and problems that an organization is likely to experience without undergoing too much cost (Wang & Dai, 2009).

The purpose of the current paper is to describe the strategic plan of MedStar Montgomery Medical Center and evaluate how this strategy fits into the BSC for measuring quality. Further, a description and analysis of the center’s BSC together with the recommended improvements measures are also provided. The next section deals with performance measurement in terms of the defined standards and compares with external benchmarks, which form the foundation for analyzing projected goals for a period of three years.

Organization Description

MedStar Montgomery Medical Center is one of the premier hospitals in the Montgomery region that offer in-patient and out-patient medical services. The facility is beamed as a leader in medical services by the management. A member of the larger MedStar Health, the hospital, has a mission to enhance health and well-being of the community through high quality services coupled with personalized care and compassionate services. The hospital is founded on the vision of leadership in caring for people and develops health care services within the community in which it operates. Among the values espoused by the hospital are service, patient first, integrity, respect, innovation, and teamwork. The values form the cornerstone, on which the strategic plan is built, emphasizing the need of offering high quality service, improving quality of service through innovation and teamwork, as well as considering the needs of patients as a first priority based on the integrity of employees and staff at the hospital.

MedStar Montgomery Medical Center’s (MMMC) strategic plan is focused on improving the experiences of patients who are served in the community. As such, the quality improvement measures put in place are aligned with the vision of the center of becoming a leader in offering medical services in the country. In an effort to become a leader in provision of health care services in the state, the center has developed systems to assist in improving the quality of services it offers. The systems are integrated in the three year strategic plan, which deals with four main areas. The first area of focus is quality improvement in the processes and systems used to make the work easier and efficient. The second is the emphasis on the needs of patients who come at the center for various treatments. This is also captured in the value of the patient first that the center pursues. The third area is the focus on an individual work as part of a team entrenched in the philosophy of teamwork as a value held by the center. The last area is the use of data to improve the quality of service that patients receive whenever they are served at the hospital.

Major Elements of the Strategic Plan

The strategic plan being pursued by the center is in line with the rules and regulations set by the Centers for Medicare and Medicaid Services (CMS). The regulatory body requires health care organizations to develop a strategy to improve quality of service by focusing on the safety of health care services, ensure patient-centered services, timely practice, efficient management of personnel and other resources, as well as ensure equitable distribution of resources used in offering health care services. Thus, the strategic plan, rules and regulations are all aimed at ensuring that the center offers efficient services by continuously improving the quality of services that it offers to its customers. A general perspective pursued in the strategic plan includes three broad areas of resource management including people, infrastructure, information technology systems, and material for treating patients, the operations involving recommended processes and steps involved in executing the processes, and finally the results, which encompass delivery of health care services, change in behavior among the staff, and patient satisfaction indicators (Kaplan & Norton, 2007).

MMMC continues to invest in creating an environment, where quality improvement is attainable by involving the staff in achieving efficiency in performance. The center regularly holds trainings and awareness programs for employees and community using best practice approaches to project management including the Plan-Do-Check-Act, LEAN management among other management approaches to deal with particular challenges, and methodology to address the identified challenges. There are also various measures to counter them in case of their occurrence and systems to measure performance of employees and effectiveness of the programs in place.

Accrediting Body Influences on Quality Improvement Standards at MMC

MMMC is accredited by a number of accrediting bodies, which define standards of quality improvement practiced by the organization. The Center for Medicaid and Medicare Services regulations (CMS) provides rules and regulations, which MMMC must observe in its pursuit of quality improvement, while the Joint Commission accredits the programs that the organization designs and implements. The adherence and monitoring of regulation standards from accrediting bodies does not inhibit an individual pursuit for quality improvement as espoused in the organization’s strategic plan in areas of patient care, resource management including people, infrastructure, information technology, and behavior change, reduced mortality, and reduced readmission rates.

The medical goals at MMMC are implemented within the confines of the set quality measurement indicators provided by the National Database of Nursing Quality Indicators. Much focus by the Center is put on providing the patients with highest quality health care service. It is achieved through supporting mechanisms, such as providing technology to speed up payments, thus ensuring that employees are engaged in the patient first mood. The overall aim is to ensure that patients are satisfied with the services they receive. MMMC measured perception of patients about its services through surveys like Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS).

The MMMC Balanced Scorecard

The BSC is a tool to measure quality improvement developed by Kaplan and Norton (2005). The focus on the BSC is to define how customer satisfaction, financial practices, internal business process, and development opportunities are exercised in an organization. Each of the category in the BSC deals with specific elements toward the attainment of quality improvement in service delivery. For instance, customer satisfaction in terms of health care services can be assessed by exploring the responses of clients provided in the surveys to know effectiveness of communication strategies used by an organization and perceptions of customers towards these strategies. Customer satisfaction is also achieved through surveys requesting them to rate the quality of service against the standard practice set by accrediting bodies. For MMMC, the goal in customer satisfaction has been to become the leader in service delivery by a score of 95% set in the Hospital Consumer Assessment of Healthcare Providers and Systems. So far, the center has achieved a score of 75%, which is still below the target in terms of customer satisfaction on the services offered.

Internal processes have the potential to affect the quality of service that an organization gives (McLaughlin, Johnson & Sollecito, 2011). Internal processes have also been included in the BSC maintained by the center. Improvement of health care monitoring, especially for visitors who accompany patients to the hospital, has been an area of focus for the center management. Prevention of cancer, community education and training, women health, and bariatrics are among the areas that receive much focus from the management. In view of these, the center has set up benchmarks to evaluate and measure the quality and performance in these premium areas. The center has performed exceptionally well in all the premium areas of focus, except the prevention of cancer, which has continued to record newer cases. The trend has been upward during the last three years necessitating the need to have subclass in prevention of different types of cancer among patients. The target was to reduce cancer cases by 60% in a period of three years within the community served by the center. Currently, the reduction rate remains constant at 2% in this period, which is too low to achieve the target.

In development opportunities, MMMC brands itself as a leader in designing programs that seek to empower both the staff and the community through education and training. The center has also invested in research and development to identify the needs of the community it serves and come up with services that address specific needs of patients as they occur in the served population. All stakeholders of the center are involved in one form of training or the other. The target is to achieve 100% awareness about the services offered at the center. The current figure stands at 78%, which is an improvement from the last year, which was 70%.

Evaluation of the BSC

The BSC pursuit by MMMC is aligned to the priorities of the organization. The center has developed programs to regularly monitor the progress achieved in quality. The results of the analysis are used to streamline areas, which are lagging behind the target scores as well as initiate improvement plans through much focus and attention to these areas.

Ensuring high customer satisfaction has continued to define programs and activities implemented at the center. Performance in terms of service delivery and health care provisions continues to improve even though it is still behind the recommended national standards (Epstein, Manzoni & Davila, 2010). The Joint Commission, which provides accreditation to the center, requires that in terms of communication a hospital should achieve a rating of 70.5 from customers for it to pass the quality test. Also, health care practices need to be at a rating of 80.2, which indicates total faith of customers in the quality of service that a health care institution provides. So far, MMMC has ratings of 63.4 and 66.7 in communication and health care services, respectively, which fall behind the projected minimum standards. Efforts are ongoing to ensure that customer rating increases because ratings are linked to the revenue and by extension the financial investments that an organization makes.

MMMC also continues to have minimum standards that exceed the ones set by the regulatory bodies. This has helped to define measures of performance in terms of special needs that the center experiences in its service to the community. Internal processes defined in the BSC are useful in defining performance and quality improvement index, which the organization has initiated. Designating some areas as high priority areas in BSC has contributed to the positive result in the overall improvement of quality at the center. The Center’s performance has been above the ones set by the NDNQI for the last three years at a 1.5 above the projected minimum. Other national standards in the areas of infection control, community engagement, communication, service delivery, and disease prevention among others, are provided by various organizations with the mandate to set these standards.

Like many other organizations in health care industry, financial stability continues to be a challenge to MMMC. As a result, programs of the center are affected in one way or the other. In one instance, there may not be enough resources to pay the staff as much as the management would like to pay. The hospital also lacks sufficient resources to invest in state-of-the-art machinery and tools to prevent and treat diseases. The economic downturn from the global financial crisis caused a reduction in reimbursement from payers, which could also be corrected by increasing the volume of patients served by a given hospital. The effect is the limited resources to serve the increased volume (Wager, Lee & Glaser, 2013).

Also, it means that MMMC should increase the allocation for marketing in order to widen its market reach since the current one is exhausted. The population of the community served is not increasing at the same rate as expansion of the hospital facilities. Few resources mean that the center must do more to preserve quality service. Development and growth opportunities are based on the quality strategies as well as skills and knowledge of stakeholders. For MMMC, the focus is on developing a community that is well aware of the needs for good performance in terms of quality improvement while competing with other organizations that offer similar services. Measuring development opportunities is challenging due to difficulties in getting the correct external benchmarks, with which to measure against.

Suggestions for Improvement

The role of BSC is to help an organization to have priority areas that can help to meet the goals as identified in the strategic plan. Being able to measure quality improvement through specific, attainable, relevant and time-bound approach can help to realize, where the challenges are coming from and make necessary changes. The center should consult widely when developing quality improvement measures to avoid falling short of the national standards. However, benchmarks should not be the only yardsticks to measure quality since some of the practices may not be captured in them. Performance assessment should be done in terms of improved quality, set standards, and goals of the organization (Brown, 2007).

Explanation of Measures

The measures used in the BSC at MMMC are defined by accrediting bodies, such as the Joint Commission and the HCAHPS survey results. The mission, vision, goals, and objectives of the organization also influence selection of measures used for measuring performance and quality improvement. The process of compiling the data obtained from various sources is designed to give the required results. This is via official organizations involved in gathering and analyzing information about quality improvement in hospitals, customer perception and rating, financial, internal processes, and development opportunities available for a particular organization (Wager, Lee & Glaser, 2013).

Format of reporting is mostly understood within the circles of people who use data on a daily basis. This is a challenge given that other people may want to use such information on some occasions. For instance, while customer perception is put at a rating of 64.3, it does not reveal what the figure means to a lay person doing marketing for the hospital. Though the methods of reporting data is standardized, the language of use if not friendly for a lay person, hence the need to simplify presentation to allow all people to use the information appropriately.

External Benchmarks and Projected Goals

Projected goals and external benchmarks influence the goals and assessment areas of focus. It is important to have a clear approach to comparing internal and external benchmarks, based on the careful selection from national standards (Brown, 2007). The benchmarks applied at MMMC are developed by its accrediting bodies and other agencies in the country. The aim is to have better approach to the quality improvement practices that meet the needs of customers.

Conclusion

A BSC is essential and powerful and helps an organization to measure future improvements and gauge its ability to attain competitiveness in the future. Organizations that use BSC are able to have a future perspective on customer satisfaction levels, financial stability, internal processes, and development opportunities. The aim of the current paper is to describe the BSC for MedStar Montgomery Medical Center while evaluating available areas for improvement and challenges in terms of performance measures, standards, and benchmarks from accrediting bodies. From the analysis, it is evident that MMMC has integrated aspects of BSC in its pursuit of quality improvement and this has contributed to the center becoming one of the premier institutions in the state. However, more must be done in terms of using benchmarks and standards to improve quality since health care environment is changing very quickly.