Developing A Balanced Scorecard to Measure Organizational Performance

Transcription

1 Developing A Balanced Scorecard to Measure Organizational Performance Ed Hardin, Senior Vice President, Beaumont Health Dennis Mullins, Senior Vice President, Indiana University Health

2 FACULTY DISCLOSURES Ed Hardin, Nothing to Disclose Dennis Mullins, Nothing to Disclose

3 Agenda Review Session Objectives Beaumont Health Perspective Indiana University Health Perspective Audience Q&A

4 Learning Objectives 1. Analyze the unique opportunities available through the use of the Balanced Scorecard. 2. Describe a Balanced Scorecard and how it can connect strategy and action. 3. Identify Balanced Scorecard strategies that work to enable suppliers to better present their services in ways that help healthcare organizations achieve their goals.

5 Beaumont Health

6 Beaumont Health Michigan s largest health system with $4.5b in net revenue 8 hospitals, 168 outpatient sites 3,400 licensed beds 87 accredited residency and fellowship programs 5,000 staff physicians 35,000 employees Service Statistics 177,508 discharges 567,658 emergency visits 17,536 births

7 Beaumont Health (cont.) U.S. News & World Report America s Best Hospitals recognizes 4 Beaumont hospitals in the Top 10 in Metro Detroit World-class capabilities in the areas of: Cardiology & Heart Surgery Neurology & Neurosurgery Orthopedics Our largest facility, Beaumont Health Royal Oak, is the recipient of the 2017 Vizient Supply Chain Performance Excellence Award (third straight year)

8 Opening Video

9 So, Why a Balanced Scorecard? Your organization has a multi-faceted strategy, so your scorecard should reflect that dynamic You have multiple audiences and multiple audiences have different expectations What you report on demonstrates an ability to look comprehensively, work strategically and connect the dots If you want SCM to be as more than just a cost reduction function, prove you can walk and chew gum at the same time Allows you to publicize the other strengths of your supply chain or perhaps a special interest (you set the agenda!)

10 Let s Review the Components Column A What are we measuring? Column B What is the BSC perspective? Column C & D Where is this being measured? Column E How often will it be measured? Column F Where outside the organization can we compare ourselves? Column G What type of an indicator is this?

11 Strategies That Work Get beyond the financial; the BSC must be balanced! Your senior leadership at minimum your CFO and COO must weigh-in and buy-in to what s measured Connect the dots between each KPI and an organizational strategy Each audience member needs to understand that the BSC represents not just their interests but the interests of multi-functional audience - don t be surprised or discouraged that your audience doesn t initially care about certain KPIs as this will change

12 Strategies That Work (cont.) The BSC should be intuitive, professional and yes.attractive to view Give yourself time to build the BSC and view its development as an iterative process but start! Appoint a point person to collect, bring continuity and rigor to the process of pulling the report together Above all else, use the BSC as your consistent message week in and week out; socialize it to such a degree that your audience knows what to expect and direct their conversations with you in that same vein

13 Supply Chain Balanced Scorecard System Facility Nationally Key Performance Indicator Perspective Level Level Frequency Benchmarked? Type Supply Expense per Adj Dis, CMI-Weighted (inc drugs) Financial x x Monthly Yes Lagging Drug Expense per Adj Dis, CMI-Weighted Financial x x Monthly Yes Lagging Supply Expense as % of NPSR Financial x x Monthly No Leading Supply Expense as % of Operating Expense (exc D&I) Financial x x Monthly No Leading Supply Expense to GL Code Financial x x Monthly No Lagging Total Supply Spend Financial x x Monthly No Lagging Cost to Serve Operational x Quarterly No Leading/Lagging Value Analysis Savings Operational x x Monthly Yes Leading EDI Supplier Spend as % of Total Spend Operational x Monthly Yes Leading CSC Direct Spend as % of Total Spend Operational x x Monthly No Leading Inventory Turns (CSC and procedure areas) Operational x x Quarterly Yes Lagging CSC Fill Rate to Facilities Operational x Monthly Yes Lagging Diversity Spend as % of Total Spend Operational x Quarterly Yes Leading Total Reprocessing Spend Operational x x Quarterly No Leading Contracted Spend as % of Total Spend Operational x x Monthly Yes Leading Employee Satisfaction / Engagement People x x Quarterly Yes Lagging Diversity in Management as % of Total Spend People x Quarterly No Lagging Labor Productivity People x Monthly No Lagging Lumbar Fusion Length of Stay Quality x Monthly No Leading/Lagging Lumber Fusion <30 Day Readmission Quality x Monthly No Lagging C-Section/Vaginal Delivery Length of Stay Quality x Monthly No Leading/Lagging # Suppliers that Meet Relationship "Gold" Standard Quality x Quarterly No Leading # Contracts with KPI as Contract Condition Quality x Quarterly No Leading

14 Indiana University Health

15 Indiana University Health includes Indiana s most comprehensive academic health center and is one of the busiest hospital systems in the United States. Patients Admissions 117,245 Outpatient Visits 2,629,251 Available Beds 2,576 ER Visits: 448,044 Surgery Cases: 102,206 Staff Team Members: 25,927

16 What is Strategy Deployment? Derived from a Japanese concept Hoshin Kanri Hoshin Compass needle (setting direction) Kanri Management of resource It is a structured process aligning and deploying strategic objectives, yearly objectives and action, initiatives, measures and focus throughout entire organization The emphasis is on Doing and Reviewing Structured framework for planning, focus and alignment 16

17 Traditional planning No alignment Over commitment of stakeholders Planning lacks f data Too many, arbitrary, wrong goals and initiatives No recovery process when goals are missed Weak implementation plans The Good Ideas Club Two key failure modes: Lack of effective action planning & lack of effective corrective action 17

18 Strategy Deployment versus Operational Management focus Strategy Deployment Strategy based Emphasizes stretch and breakthrough thinking Proactive, not reactive Moves organization forward by: Focusing on process Changes the culture Operational Management Time focused on daily tactics Firefighting and band-aids Maintaining a level business React to whatever is thrown my way Standard Work and Managing for Daily Improvement enable focus on SD breakthrough initiatives 18

19 Strategy Deployment Process Establish Organizational Vision 3 year strategic plan A3 Process Thinking Planning Self Diagnosis (Strategic Objectives) 1 year breakthrough objectives the what 1 year improvement initiatives the how Catchball 1 year improvement s with milestones Implementation Countermeasure Analysis Deploy through organization Take Action SBS tools 19 Review and adjust to achieve s Monthly review Annual review / adjustment 19

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23 Value Stream Progress

24 Watch Watch Watch Watch Goal Goal Goal Goal Goal Goal Goal Tracking Progress and Alignment Scope Legend: Video Visits - Level 1 TRACKER Metric Legend: Red = Not meeting & requires countermeasure SBS = System Balanced Scorecard Green = Meeting SD = Strategy Deployment Black = Not applicable in current month TPOC = Transformation Plan of Care Yellow = Measure needs populated by owner System Balanced Scorecard Pillar Scope Metric Type Initial State SBS Quality & SD % Cases Protocol Safety Followed with Antibiotics Quality & Safety Service Service Finance & Growth Finance & Growth Finance & Growth SBS SD SBS SBS SBS SBS SD SBS Pillar Scope Driver / Metric Initial State Quality & Safety Quality & Safety Service Service SD SD SD SD % Cases Where Protocol was Followed Net Promotor Score Patient Connected w/physician in Timley Manner Achieve Visit Targets Operating Income Loss Increase Patient Acquisition % Patients Receiving Prescriptions % Patients Receiving Oral Antibiotics Patient Referral to Primary Care Patient Satisfaction Year End Target % Improve Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Metric Owner Contermeasures (Links to A4s) MONTH YEAR MONTH YEAR MONTH YEAR MONTH YEAR MONTH YEAR MONTH YEAR MONTH YEAR TPOC & Strategy Deployment Metrics (that do not live on the System Balanced Scorecard) Targets or Limits % Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Metric Owner Contermeasures (Links to A4s) MONTH plan YEAR plan MONTH YEAR MONTH YEAR MONTH YEAR plan plan plan plan plan plan

25 WATCH METRIC System Goals Alignment 2017 OPERATIONAL GOALS - SYSTEM Weight Goal Description Performance Management Creator Supply Chain Alignment 30% QUALITY & SAFETY 25% Metric 20% 5% 5% Harm Dashboard: Achieve and maintain top quartile performance or decrease total harm events over the course of the year from 2016 year end performance. Population Health: All Population Health region scores on the 12 measures (except CG-CAHPS) roll up equally into 1 system score. Length of Stay: All LOS region scores (O/E using appropriate risk model) up equally into 1 system score. Pediatric Population Health Dashboard: All pediatric population health region scores on the 10 Peds measures (except CG-CAHPS) roll up equally into 1 System score. roll Maximum = Decrease by 16% or achieve top quartile 880 Target = Decrease by 13% 912 Threshold = Decrease by 10% 943 Maximum = Achieve or maintain 90th %tile 3 Target = Achieve or maintain 70th %tile 2 Threshold = Achieve or maintain 50th %tile 1 BU Regional metrics only. Target = Achieve or maintain 70th %tile J. Gottlieb Link Establishment of Executive Value Analysis Team (EVAT) to provide guidance and oversight of the Value Analysis process Carli 30 Day Readmit Percent BU Regional metrics only. 15% SERVICE 25% 5% 5% 5% Inpatient (Hospitals below Value Based Purchasing threshold will have a goal to achieve an overall rating score aligned to full reimbursement) Outpatient (Facilities where Value Based Purchasing does not apply will have a goal to grow at +.5 raw percentage points) Provider Office Visit (Facilities where Value Based Purchasing does not apply will have a goal to grow at +.5 raw percentage points) Maximum = +1 raw percentage point improvement over 2016 Overall Rating of Care Target = +.5 raw percentage point improvement over 2016 Overall Rating of Care Threshold = >0 raw percentage point improvement over 2016 Overall Rating of Care Maximum = +1 raw percentage point improvement over 2016 Overall Rating of Care Target = +.5 raw percentage point improvement over 2016 Overall Rating of Care Threshold = >0 raw percentage point improvement over 2016 Overall Rating of Care Maximum = +1 raw percentage point improvement over 2016 Overall Rating of Care Target = +.5 raw percentage point improvement over 2016 Overall Rating of Care Threshold = >0 raw percentage point improvement over 2016 Overall Rating of Care 2 Link 20% PEOPLE 20% % Create a more engaging work environment where employees are committed. Increase score on the Employee Engagement Survey Engagement Indicator (EI) based on previous performance level R. Chadderton Construction and implementation of Integrated Service Center Derrick and Kumbia Create a more engaging work environment where employees are committed. Increase score on the Employee Engagement Survey Engagement Indicator (EI) based on previous performance level. 10% 1st year Turnover 19.70% % % 3 1st year Turnover 20.90% % 2 L. Dunlap Cascade 22.50% % Create a more engaging work environment where providers are committed. Increase score on the Provider Engagement Survey Engagement Indicator (EI) based on previous performance level. Create a more engaging work environment where providers are committed. Increase score on the Provider Engagement Survey Engagement Indicator (EI) based on previous performance level.

26 System Metric Alignment

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28 Indiana University Health includes Indiana s most comprehensive academic health center and is one of the busiest hospital systems in the United States. Patients Admissions 117,245 Outpatient Visits 2,629,251 Available Beds 2,576 ER Visits: 448,044 Surgery Cases: 102,206 Staff Team Members: 25,927

29 What is Strategy Deployment? Derived from a Japanese concept Hoshin Kanri Hoshin Compass needle (setting direction) Kanri Management of resource It is a structured process aligning and deploying strategic objectives, yearly objectives and action, initiatives, measures and focus throughout entire organization The emphasis is on Doing and Reviewing Structured framework for planning, focus and alignment 29

30 Traditional planning No alignment Over commitment of stakeholders Planning lacks f data Too many, arbitrary, wrong goals and initiatives No recovery process when goals are missed Weak implementation plans The Good Ideas Club Two key failure modes: Lack of effective action planning & lack of effective corrective action 30

31 Strategy Deployment versus Operational Management focus Strategy Deployment Strategy based Emphasizes stretch and breakthrough thinking Proactive, not reactive Moves organization forward by: Focusing on process Changes the culture Operational Management Time focused on daily tactics Firefighting and band-aids Maintaining a level business React to whatever is thrown my way Standard Work and Managing for Daily Improvement enable focus on SD breakthrough initiatives 31

32 Strategy Deployment Process Establish Organizational Vision 3 year strategic plan A3 Process Thinking Planning Self Diagnosis (Strategic Objectives) 1 year breakthrough objectives the what 1 year improvement initiatives the how Catchball 1 year improvement s with milestones Implementation Countermeasure Analysis Deploy through organization Take Action SBS tools 32 Review and adjust to achieve s Monthly review Annual review / adjustment 32

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36 Value Stream Progress

37 Watch Watch Watch Watch Goal Goal Goal Goal Goal Goal Goal Tracking Progress and Alignment Scope Legend: Video Visits - Level 1 TRACKER Metric Legend: Red = Not meeting & requires countermeasure SBS = System Balanced Scorecard Green = Meeting SD = Strategy Deployment Black = Not applicable in current month TPOC = Transformation Plan of Care Yellow = Measure needs populated by owner System Balanced Scorecard Pillar Scope Metric Type Initial State SBS Quality & SD % Cases Protocol Safety Followed with Antibiotics Quality & Safety Service Service Finance & Growth Finance & Growth Finance & Growth SBS SD SBS SBS SBS SBS SD SBS Pillar Scope Driver / Metric Initial State Quality & Safety Quality & Safety Service Service SD SD SD SD % Cases Where Protocol was Followed Net Promotor Score Patient Connected w/physician in Timley Manner Achieve Visit Targets Operating Income Loss Increase Patient Acquisition % Patients Receiving Prescriptions % Patients Receiving Oral Antibiotics Patient Referral to Primary Care Patient Satisfaction Year End Target % Improve Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Metric Owner Contermeasures (Links to A4s) MONTH YEAR MONTH YEAR MONTH YEAR MONTH YEAR MONTH YEAR MONTH YEAR MONTH YEAR TPOC & Strategy Deployment Metrics (that do not live on the System Balanced Scorecard) Targets or Limits % Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Metric Owner Contermeasures (Links to A4s) MONTH plan YEAR plan MONTH YEAR MONTH YEAR MONTH YEAR plan plan plan plan plan plan

38 WATCH METRIC System Goals Alignment 2017 OPERATIONAL GOALS - SYSTEM Weight Goal Description Performance Management Creator Supply Chain Alignment 30% QUALITY & SAFETY 25% Metric 20% 5% 5% Harm Dashboard: Achieve and maintain top quartile performance or decrease total harm events over the course of the year from 2016 year end performance. Population Health: All Population Health region scores on the 12 measures (except CG-CAHPS) roll up equally into 1 system score. Length of Stay: All LOS region scores (O/E using appropriate risk model) up equally into 1 system score. Pediatric Population Health Dashboard: All pediatric population health region scores on the 10 Peds measures (except CG-CAHPS) roll up equally into 1 System score. roll Maximum = Decrease by 16% or achieve top quartile 880 Target = Decrease by 13% 912 Threshold = Decrease by 10% 943 Maximum = Achieve or maintain 90th %tile 3 Target = Achieve or maintain 70th %tile 2 Threshold = Achieve or maintain 50th %tile 1 BU Regional metrics only. Target = Achieve or maintain 70th %tile J. Gottlieb Link Establishment of Executive Value Analysis Team (EVAT) to provide guidance and oversight of the Value Analysis process Carli 30 Day Readmit Percent BU Regional metrics only. 15% SERVICE 25% 5% 5% 5% Inpatient (Hospitals below Value Based Purchasing threshold will have a goal to achieve an overall rating score aligned to full reimbursement) Outpatient (Facilities where Value Based Purchasing does not apply will have a goal to grow at +.5 raw percentage points) Provider Office Visit (Facilities where Value Based Purchasing does not apply will have a goal to grow at +.5 raw percentage points) Maximum = +1 raw percentage point improvement over 2016 Overall Rating of Care Target = +.5 raw percentage point improvement over 2016 Overall Rating of Care Threshold = >0 raw percentage point improvement over 2016 Overall Rating of Care Maximum = +1 raw percentage point improvement over 2016 Overall Rating of Care Target = +.5 raw percentage point improvement over 2016 Overall Rating of Care Threshold = >0 raw percentage point improvement over 2016 Overall Rating of Care Maximum = +1 raw percentage point improvement over 2016 Overall Rating of Care Target = +.5 raw percentage point improvement over 2016 Overall Rating of Care Threshold = >0 raw percentage point improvement over 2016 Overall Rating of Care 2 Link 20% PEOPLE 20% % Create a more engaging work environment where employees are committed. Increase score on the Employee Engagement Survey Engagement Indicator (EI) based on previous performance level R. Chadderton Construction and implementation of Integrated Service Center Derrick and Kumbia Create a more engaging work environment where employees are committed. Increase score on the Employee Engagement Survey Engagement Indicator (EI) based on previous performance level. 10% 1st year Turnover 19.70% % % 3 1st year Turnover 20.90% % 2 L. Dunlap Cascade 22.50% % Create a more engaging work environment where providers are committed. Increase score on the Provider Engagement Survey Engagement Indicator (EI) based on previous performance level. Create a more engaging work environment where providers are committed. Increase score on the Provider Engagement Survey Engagement Indicator (EI) based on previous performance level.

39 System Metric Alignment

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