Duke Children Hospital Balanced Scorecard - Essay Example

? Duke Children’s Hospital Balanced Scorecard Introduction A balanced scorecard (BSC) refers to a planned performance administration framework used by managers in monitoring the progress of business in their organizations or firms within the limit of their powers with a particular focus on the activities taking place and managing the consequences resulting from these activities. It is a set of tools and a process that assist organizations or companies to extract operational objectives from a developed strategy. A BSC mainly concentrates on the significance of a number of management components including human and physical inputs, lagging returns, and the involved processes. A Balanced scorecard therefore aids in achieving the firm’s strategic priorities and goals. In developing a balance scorecard, Duke Children’s Hospital had an established strategy: “perk up communications to perk up quality of health care while reducing expenses.” The organization sought to use the balanced scorecard in evaluating its business processes and stakeholder relationship due to its meditated impacts on business organizations. Duke Children’s Hospital employed the strategy of evaluating and examining its past records such as patient satisfaction survey data, in establishing the balanced scorecard. As a result of its anticipated positive results, the staff generally took it positively and was patient to reap the fruits. Analysis In the Duke Children’s Hospital, the developed BSC methodology started with the development of the strategic plan and a mission. The senior management were involved in setting the strategic goals and provided credible support for the project. The key metrics for measuring performance were then developed and established. The process was concluded by developing initiatives that were pointed towards enhancing performance and to support the realization of the set strategic goals. The Balance Scorecard was set to act as an important platform to spearhead the incorporation of the principal methodologies, initiatives, and the established procedures across critical perspectives. Even though financial performance is a critical issue in any organization, the major focus of Duke Children’s Hospital over the balance scorecard was on clinical quality and patient safety. This interest is well executed in the organization’s mission and vision. In order to thrive as planned, Duke Children’s Hospital was compelled to make a number of changes with regard to the balance scorecard. First, the initial principal concern for the organization just like any other (financial interest) was interchanged as key concern and instead they focused more on the patient safety and clinical quality. This was altered from the normal arrangement perspective whereby the “Financial” interest was initially first, and was instead moved to position three while “Quality and Patient Safety” took the top position. Further, its significance and value was well indicated and stressed. Another change that was observed in the business process is that of linking goals with performance metrics. After the strategic plan was defined, the organization took the responsibility to determine specific goals which were then linked to each strategic perspective. Duke Children’s Hospital also sought to limit the goal to a smaller number for the purpose of maintaining focus on initiatives meant to drive the strategic plan. Specific metrics which were meant to be measured and collected after every four months were then defined and linked to the goals. In doing this, a number of measures were employed to determine a manageable process. For instance, the metrics were derived from a variety of kept records of the organization. This involved retrieving the initial patient safety database derived from internal safety reporting systems, initial financial and hospital operational database, and the past patient satisfaction survey data, among others. Conclusion The establishment of the balance scorecard was accompanied with a number of strategic changes focused to improve the performance and beautify the records and image of Duke Children’s Hospital, of which some are described above. This also involved having individual scorecards at the service unit level and also at the individual operating unit level. This was meant to trigger and enhance focused improvement efforts by individuals at the direct patient unit level. Moreover, to enforce this metrics, the approach was implemented alongside the developed strategic goals of the broader organization. This alignment of performance improvement (PI) with the organization goals was done on purpose to discourage individual from focusing much on local concerns that could otherwise have a poor impact on the organization’s returns. More on this, aligning Performance Improvement initiatives toward the organization’s strategic goal initiated a credible economy scale and ensured that the whole organization and its members benefited significantly from collaborative efforts. For these credible benefits to be realized, it typically means that both the patients, employees and all stakeholders benefited significantly in their various perspectives. Evaluation Results prove that Duke Children’s Hospital succeeded in designing and implementing the balance scorecard. For instance from the perspective of “Quality and Patient Safety”, a number of improved situations were clearly evident. When it is compared to the past economic year, morbidity drop was noted along with decreased readmits to 4 percent from 7 percent, infection rates drop to 1 percent right from 3 percent, and a 0.6 days decrease in the length of stay. Additionally, an increase in mean daily census was noted to improve by 9% over the past economic period. On the other hand of Finance perspective, an improvement was noted whereby the patient flow team realized an increment in discharge by 26 percent. Further the patient flow team attained a step up of 10 percent in “Pediatric Intensive Care Unit (PICU)” encounters. Since the establishment of the Balance Scorecard (BSC), a good number of finance-linked initiatives have been implemented. These initiatives are believed to have caused a significant rise in the variable of contribution margin by 240%. The initiatives are also linked to the realized shoot-up in net finance margin of 4.7 million dollar lose per annum to a sum of 7.4 million dollars over the past 2 years. Also from the “Customer” point of view, as compared to the past economic year, patient satisfaction score have surpassed the expectation as per the set targets. Moreover, the number of patients referring to Duke Children’s Hospital as “perfect” has also grown beyond the set target and this is all linked to the introduction and establishment of the BSC. References Norton, P. & Kaplan, S. (1996). The balanced scorecard: translating strategy into action. Boston: Harvad Business School Press. Meliones, J., Ballard, R., Liekweg, R., & Burton, W. (2001). No mission, no margin: it’s that simple. Journal of Health Care. 27 (3): 21-30. 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