designing a developed balanced score-card model to...

© 2016 Fatemeh Semnani and Rouhangiz Asadi. Volume 2 Issue 1 JBHRM-2-005 of 16

Journal of Business and Human Resource Management Received: Nov 22, 2015, Accepted: Jan 12, 2016, Published: Jan 15, 2016

J Bus Hum Resour Manag, Volume 2, Issue 1

http://crescopublications.org/pdf/jbhrm/JBHRM-2-005.pdf

Article Number: JBHRM-2-005

Research Article Open Access

Designing a Developed Balanced Score-card Model to Assess Hospital

Performance Using the EFQM, JCI Accreditation Standards and Clinical

Governance

Fatemeh Semnani* and

Rouhangiz Asadi

Hospital Management of Research Hospital, Iran University Medical of Sciences, Tehran, Iran

*Corresponding Authors: 1. Fatemeh Semnani, Hospital Management of Research Hospital, Iran University Medical of

Sciences, Tehran, Iran; Tel: 00982188644485; Fax: 00982188644479; E-mail: [email protected]

2. Rouhangiz Asadi, Hospital Management of Research Hospital, Iran University Medical of Sciences, Tehran, Iran; Tel: 0098 21

88644485; Fax: 0098 21 88644479; E-mail: [email protected]

Citation: Fatemeh Semnani and

Rouhangiz Asadi (2016) Designing a Developed Balanced Score-card Model to Assess Hospital

Performance Using the EFQM, JCI Accreditation Standards and Clinical Governance. J Bus Hum Resour Manag 1: 005.

Copyright: © 2016 Fatemeh Semnani and Rouhangiz Asadi. This is an open-access article distributed under the terms of the

Creative Commons Attribution License, which permits unrestricted Access, usage, distribution, and reproduction in any medium,

provided the original author and source are credited.

Abstract

It is vital in today‟s competitive world to present high-quality health services with appropriate costs and on-time

delivery in order to achieve competitive advantages for hospitals. To this end, assessment of hospital performance and

continuous improvement of the performance play key roles. Many standards and systems are used in hospitals for

assessing the hospital performance, none of which covers all hospital areas alone. Therefore, in Hasheminejad

hospital, a new and complete model covering all areas was designed and utilized using JCI accreditation standards,

clinical governance and EFQM model of organization sublimity and the combination of these standards with balanced

score card (BSC) model dimensions. Based on Radar logic, continuous improvement has occurred in hospital

performance. The designed model was administered in Hasheminejad Hospital for 4 years, and the results related to

the consecutive years were analyzed and compared. The model administration for 4 years in Hasheminejad Hospital

indicated continuous improvement of hospital performance and the success of the presented model.

Keywords: Performance assessment; Operational standards; System of performance assessment; Continuous

improvement; Balanced score card.

Introduction

Healthcare is not only the fastest growing service industry,

both in the developed and developing countries, but also

impacts the well-being of people. For this reason, healthcare

is receiving much attention around the world [1]. As quality

of care and service is a top priority, the health care

organizations are continuously making efforts for improving

quality of services and increasing business performance.

Some of today‟s primary discussion topics in health care are

cost management, empowerment of patients, deregulation,

and competition between health care providers [2]. The goal

of the health care organizations is to achieve the highest

quality of care possible with the resources that are available,

even with limited medical equipment, human resources,

finances, and others [2, 3]. During recent years, health

system officials in different countries of the world have used

various methods to increase the quality and security of

health services, and manage them optimally. In a broad look,

they can be investigated within two main groups:


1. Models that increase organization‟s commitment to

quality promotion by extra-organizational assessment based

on quality,

2. Methods that help manage the quality inside

organizations.

Among these, accreditation from the first group, and clinical

governance and security pro from the second group enjoyed

a special position in the health section.

This is because the security and patient-based discourses are

paid attention beside service quality promotion and,

organization commitment is emphasized for the purpose of

administering high servicing standards. Therefore, the model

presented in this research tries to provide easy and cool

conditions for hospitals to increase its ability in presenting

secure, and qualitative, services that are based on update and

native evidence via concurrent and coordinated utilization of

all management models and quality guarantee and to get

prepared for extra-organizational assessment based on

specified standards. Moreover, the main problem with

hospitals, especially Hasheminejad Hospital is in their

plurality of evidences and maintaining different editions of

them. A shared document may be developed several times

for a number of qualitative models, while it can be

developed just once and used in different models for several

times. Updating these documents for every model in every

time period is a difficult and time-consuming task. This

model provides the possibility that each topic be defined

once and used in all qualitative models. The models of

quality guarantee and management, accreditation, clinical

governance, EFQM and BSC, existence of strategic program

and operational programs are suggested in hospital, and in

all of these models, the existence of the goal of security and

quality promotion in strategic program is intended.

Therefore, when the hospital observes security in line with

clinical governance, it means the fulfilment of the security

section of clinical governance [4].

Literature Review

The BSC

In 1992, Dr. Robert Kaplan and Dr. David Norton

introduced the BSC as a performance measurement tool. It is

also a strategic management tool for translating an

organization‟s strategies into operational terms. The BSC is

a conceptual tool, and its four perspectives can be modified;

flexibility is part of its attraction. Accordingly, the BSC is a

performance measurement tool that can be customized for

every organization and utilized as a strategic management

framework to align an organization‟s strategies and

objectives. Implementing the BSC requires that executives:

a) develop coherent strategies in order to achieve the

organization‟s mission and b) develop a set of KPI to

monitor the organization‟s performance and strategic

alignment [5].

Many organizations use the BSC merely as a performance

measurement tool. However, it is necessary to track strategic

alignment as there is usually deviation between an

organization‟s goals and executive actions; this happens

because executive actions are affected by variable

environmental factors such as politics and economic

conditions. By defining long-term and short-term goals,

organizations will be able to measure their performance and

track their strategic alignment. It helps directors to find out

what the organization‟s current situation is, and how it is

supposed to be; subsequently they can adapt appropriate

strategies to meet deviation between the organization‟s goals

and executive actions.

BSC generations

BSC evolution can be divided into three stages known as

three BSC generations. Each generation is distinguished by

its method of utilizing performance perspectives and KPI

(Key Performance Index) to reflect an organization‟s

performance and strategies [6]. The first generation of BSC

combines financial and non-financial indicators under four

traditional perspectives: financial, customer, internal

business process, and learning and growth. The BSC‟s first

generation, also known as traditional BSC, includes KPIs

that are only proper for performance the measurement. This

generation of the BSC is relatively easy to develop and

implement [6].

The second generation of BSC emphasizes cause and effect

relationships among measures and strategic objectives. It has

become a strategic management tool that utilizes a strategy

map to reflect the linkage among measures and strategies. In

fact, there is a formal linkage of strategic management and

performance management that is emphasized by the second

generation of BSC [6].

Lawrie and Cobbold argued that the third generation of BSC

is about developing strategic control systems by

incorporating destination statements, and optionally two

perspective strategic linkage models. They used „activity‟

and „outcome‟ perspectives instead of the four traditional

perspectives [7]. Speckbacher et al. [8] defined the third

generation of BSC as the second generation of the BSC that

additionally implements the organization‟s strategies by

defining its objectives, action plans and results, and by

linking incentives to BSC measures. Miyake stated that the

third generation of BSC derives from the concept of the

strategy-focused organization [8].

BSC in the health sector

Although there was initially a low perception of the BSC

within the health sector, over the past decade, interest in the

BSC has been growing among the health service providers

around the world in both the developed and developing

countries. According to the literature, there is a diversity of

reasons for development and implementation of the BSC in

the health sector.


Major reasons are presented in Table 1, which highlights a

set of significant reasons for BSC implementation in the

health sector, from improved performance measurement and

reporting to organizational integration. In an extensive

review, Zelman et al. [9, 10] indicated that the BSC has been

introduced across all health service areas including:

Hospitals

University medical centers and health departments

Pharmaceutical care

Health insurance companies

Not only has the BSC been utilized for strategic

management at the organizational level, but it has also been

used within the health setting for assessment of health

services, improvement projects, accreditation, clinical

pathways, and performance measurement across a number

of hospitals. The first article on BSC in the health sector was

published in 1994; it argued the necessity for continuous

quality improvements in the health setting.

Table 1: Some examples of documented reasons for implementation of the balanced scorecard (BSC) in the health sector

Authors Organization Reason

Aguilera and Walker

[11]

St Vincent‟s

Private Hospital,

Australia

The BSC was initially introduced in the nursing directorate as a framework for

improving clinical governance in order to achieve better outcomes for patients and

staff. Due to the success of this trial, it was later expanded across the whole hospital.

Bloomquist and Yeager

[12]

Emory Healthcare

in Atlanta, USA

They had a structural transition from independent units (three hospitals and two faculty

practices) to an integrated healthcare system. They utilized the BSC in order to assist

in generating a unified system to reach successful transition.

Chang et al. [13] Mackay Memorial

Hospital, Taiwan

They needed to use best practice business tools to help them take a more strategic

approach that would differentiate their services and attract more business, and that

would also improve communication and collaboration between all levels of staff and

key stakeholders. In addition, their board requested an annual performance report that

would provide a more comprehensive view of the organization‟s performance in

fulfilling its mission.

Garling [14] Children‟s Health

Systems, USA

With an upcoming major capital expansion, along with a recognition that the

organization was structured by region and health practice with competing agendas and

resource demands, executives at Nemours Children‟s Health System in the USA

decided to unify the organization around „One Nemours‟. Critical to this

transformation was their adoption of the BSC to help align and strengthen the

organization.

Gottlieb [15] Faulkner Hospital,

USA

The BSC was implemented to help them have a source of reliable information on

performance. They also intended to address several major challenges including nursing

shortages, and ensuring that all patients, regardless of socioeconomic status, received

top-quality care.

Aidemark and Funck

[16]

Högland Hospital,

Sweden

The BSC was introduced as a management tool to combine financial control and

quality improvement, along with the development of clinical staff competence. It was

initially introduced in 1997 as a 2-year trial but continued because of the success of the

trial.

Marr and Creelman

[17]

The Northumbria

Healthcare NHS

Foundation, UK

They were looking for a new and powerful tool for sharpening their strategic

formulation capabilities, to ensure they continued to be a high-performing healthcare

provider.

McDonald et al. [18]

St Mary‟s/Duluth

Clinic Health

System

They utilized the BSC after finding that traditional methods of healthcare strategy

formulation (for example, extensive consultation resulting in a complex detailed

strategic plan) did not work and they needed to adopt a new approach from outside of

healthcare.


The residency hospital of Shahid Hasheminejad is the first

and the only special center of kidney disease treatment in

Iran that is more than 50 years old and supervised under

University of Medical Sciences Iran. Beside urology,

nephrology, andrology and vascular surgery services, this

center has units for substitutive kidney treatments such as

hemodialysis, peritoneal dialysis and kidney transplantation.

Over the last decade, this hospital took measures to use

models for quality promotion and performance assessment

systems to enhance its servicing in the universal class

besides providing a successful model for country-wide

benchmarking. To begin the promotion process and

movement towards sublimity, the assessment tool of EFQM

was translated and converted under the hospital, and country

wide conditions were used. As an independent organization,

it began assessing, planning and using quality systems with

no assistance nor supervision from superior organization.

The result was a considerable change that promoted all key

outcomes of the organization performance. Moreover, as a

country wide model in the health industry, it was visited by

hospital and non-hospital bodies. In parallel, the models

used and even the innovations resumed in the very center via

trial and error were used in other centers. After the initial

years and by the organizational maturity, the need to use

several promotion models and different systems as well as

the entrance of superior organizations into qualitative

assessment of hospitals (in Iran in substitution for

quantitative assessments) created new problems such as the

following:


The hospital was visited by a group of superior

organizations with several assessment models. In other

words, each health ministry assistance used one

assessed model according to defined goals and

missions, and required hospitals to respond based on

the same model. Clinical governance, security-pro

hospital, sublimity by EFQM, Iso TQM, 6 Sigma, 5s,

BSM, etc. were among these models and systems.

Some of the indices and areas suggested in these

models were common and some were different from

each other. Most of these models were common in

quality and security but mixed up the hospital in

presenting and preparing for responsibility.

An integrated and comprehensive model covering all

operational areas of hospital, financial or non-financial,

was not presented (based on the conducted given in

Table 1).

Integrated Conceptual Model based on BSC

First, the junior managers of the organization decided that

the ideal solution is the use of the best option, each model‟s

dimensions for quality promotion and models combination,

and response to superior organizations based on request type

or the requested model. Because of the expanse of each

model and its assessment checklists, it was necessary that a

number of bureaus for each model be formed by expert and

specialized staff using the relevant models and each office

are responsible for collecting its own unit‟s documents.

The documents related to financial indicators are extracted

from the documents included in the EFQM and BSC models

and national accreditation. However, there are not financial

indicators in JCI, clinical governance.

The second solution was the use of the models of the very

center and juxtaposing the indices, dimensions, and criteria

of BSC and EFQM regardless of the requests of superior

organizations. Since the organization forces were besieged

at the time of external assessments and request for document

presentation according to other models in order to change its

presentation type and documents frames immediately, this

solution did not succeed either because it consumed high

levels of energy or was costly in human terms. Therefore,

the third solution was developing a conceptual model based

on BSC that could answer all the above challenges. The

present research addressed this comprehensive and

integrated solution for hospital management. Since an

organization‟s strategic goals specified based on its

statements determine where organizations move to, it was

decided that the model used for performance assessment and

the strategic program establishment in this hospital should

be used as the basic model based on which other models will

be arranged. Therefore, because the BSM model was used in

this center since 2007, it was selected as the method for

strategic program establishment and the basis for

organization‟s performance assessment. Then, the

conceptual model of the research was considered and

suggested based on the following format:

The suggested model consisted of three levels. At the first

level, there are standards and requirements that should be

observed by all health centers, that is, JCI (at the universal

level), national accreditation (in Iran), clinical governance

(at the universal level) as well as the requirements that all

organizations, including health, servicing, productive

organizations, etc. are to observe like EFQM.

At the second level, there are operational criteria

incorporating the criteria extracted from the four dimensions

of BSM (society and servicing/customers, internal

processes, development and learning, and financial).

The third level was defined based on BSC administration

method developed at the levels of organization and all units.

This model is derived from Radar logic in the EFQM model.

In the Radar logic, the organization has to determine the

results that it wants to achieve based on the beneficiaries‟

needs and its own processes (R = Results). To achieve the

desired results at present and in the future, a collection of

appropriate approaches is planned and developed (A =

Approach). To ensure administration of appropriate

approaches, they should be deployed systematically (D =

Deployment). The deployed approaches should be assessed

and refined based on monitoring and analyzing the achieved

results and the continuous learning activities (Refinement &

A = Assessment). The results (R) were turned into necessary

standards and major criteria at level one. The approaches

and administration were translated at the second level, and

the assessment and refinement (R) were defined at the third

level.

Model Components

Accreditation

Accreditation means systematic evaluation of centers

presenting health services with specified standards

emphasizing continuous quality improvement, key role of

the patient and enhanced security for patient and the staff.

Accreditation is used for describing the quality of health

services as the basis of the relevant thoughts. It is based on

healthcare policies and understanding what is related to the

care quality besides concentration on fundamental principles

for consolidating the development of health system and

activating it [4].


Figure 1: Conceptual Model of the Research

JCI

Joint Commission International (JCI) is an international

organization that accredits hospitals worldwide since 1998.

With regional offices in Asia-Pacific, Europe and the

Middle East, and North Africa, JCI works with ministries of

health, international health care organizations, public health

agencies, governmental agencies, and others to evaluate and

improve the quality and safety of patient care throughout

each region. JCI is uniquely positioned to adapt leading

global practices to the delivery of local care. Standards are

developed and organized around important functions

common to all health care organizations. The functional

organization of standards is now the most widely used

around the world, and has been validated by scientific study,

testing, and application.

The EFQM model

The EFQM Excellence Model allows people to understand

the cause and effect relationships between what their

organization does and the results it achieves.

The model comprises of a set of three integrated

components:

The fundamental concepts of excellence

The fundamental concepts define the underlying principles

that form the foundation for achieving sustainable

excellence in any organization.

The criteria

The Criteria provide a framework to help organizations to

convert the Fundamental Concepts and RADAR thinking

into practice.

The RADAR

RADAR is a simple but powerful tool for driving systematic

improvement in all areas of the organization.

The beauty of the model is that it can be applied to any

organization, regardless of size, sector or maturity. It is non-

prescriptive and takes into account a number of different

concepts. It provides a common language that enables our

members to effectively share their knowledge and

experience, both inside and outside their own organization.

The Fundamental Concepts of Excellence outline the

foundation for achieving sustainable excellence in any

organization. They can be used as the basis to describe the

attributes of an excellent organizational culture. They also

serve as a common language for top management.

The RADAR logic is a dynamic assessment framework and

powerful management tool that provides a structured

approach to questioning the performance of an organization.

National

accreditation

Assess and improve the performance of

hospital

Hospital performance evaluation based on BSC

Finance

perspective

Learning and training

perspective

Internal processes Society and the

environment

EFQM JCI Clinical

Governance

Standards and basic models

Fits models with perspective of BSC

Implementation of BSC


At the highest level, the RADAR logic states that an

organization should:

Determine the results it is aiming to achieve as part of

its strategy.

Plan and develop an integrated set of sound approaches

to deliver the required results both now and in the

future.

Deploy the approaches in a systematic way to ensure

implementation.

Assess and Refine the deployed approaches based on

monitoring and analysis of the results achieved and on-

going learning activities.

Clinical Governance

Clinical governance is a systematic approach to maintaining

and improving the quality of patient care within a health

system (NHS). Clinical governance became important in

health care after the Bristol heart scandal in 1995, during

which an anesthetist, Dr. Stephen Bolsin, exposed the high

mortality rate for pediatric cardiac surgery at the Bristol

Royal Infirmary. It was originally elaborated within the

United Kingdom National Health Service (NHS), and its

most widely cited formal definition describes it as:

a framework through which NHS organizations are

accountable for continually improving the quality of their

services and safeguarding high standards of care by creating

an environment in which excellence in clinical care will

flourish key features of clinical governance, which will

require clinicians in healthcare trusts and primary care

groups to lead the development of systems for local quality

assurance and quality improvement listed in the follow:

a “duty of quality”, which relates to the organization,

not just individuals within the organization;

a comprehensive strategy to be developed by each

organization, including a range of quality improvement

methods, (e.g., audit and risk management) linked

closely to professional development programs;

a named individual appointed within each provider

organization who has responsibility for improving the

quality of care;

a focus on clinical leadership, though with greater

external accountability A focus on processes of care,

including clinical decision making, and on concepts of

appropriateness, clinical effectiveness, and evidence-

based care

Set in the context of a nationally coordinated program

of clinical guideline development including service

standards for priority areas.

Clinical governance is composed of at least the following

elements:

Education and training

Clinical audit

Clinical effectiveness

Research and development

Openness

Risk management

Information management

Table 1: Definition of words and acronyms in the balanced scorecard according to clinical governance, EFQM,and JCI

Criteria of EFQM model

Code Axles of clinical governance Code

Leadership 1 Education & training 1

Strategy 2 Risk management 2

People 3 Research and development

3

Partnership & resources

partnership

4 Information management 4

Processes, products & services 5 Clinical effectiveness 5

Customer results 6 Clinical audit 6

People results 7 Openness

7

Society results 8

Business results

9


Code Standards JCI

1 Patient & family rights (PFR)

2 Assessment of patient (AOP)

3 Care of patient (COP)

4 Patient & family education (PFE)

5 Medication management and use (MMU)

6 Anesthesia and surgical care (ASC)

7 Governance, leadership & direction (GLD)

8 Prevention and control of infection (PCI)

9 Quality improvement patient safety (QPS)

10 Facility management & safety (FMS)

11 Staff qualification and education (SQE)

12 Management of communication and information 9MCI)(MCI)

13 Patient & family rights (PFR)

Environmental

Assessment

Type of

components assessed areas

Strateg

y-

driven

financial

Quality

manage

ment

Quality

Assura

nce

In

Organ

ization

al

Out

Organ

ization

al

tool

s

Standa

rd

Clin

ical

Non-

Clinica

l

EFQM * * * * * * *

BSC * * * * * * * *

JCI * * * * * *

Clinical

Governance * * * *

The

proposed

model

(developed

BSC )

* * * * * * * * * *

Perspective of

BSC Clinical

Governance JCI EFQM

Community

stakeholders

and service

areas

Patient & public

involvement

Clinical audit

Patient & family rights (PFR)

Care of patient (COP)

Patient & family education (PFE)

Governance, leadership & direction (GLD)

Customer results

People results

Society results

People

Internal

processes

Patient safety

Risk management

Clinical

effectiveness

Access to care and continuity of care (ACC)

Patient & family rights (PFR)

Assessment of patient (AOP)

Care of patient (COP)

Patient & family education (PFE)

Prevention and control of infection (PCI)

Quality improvement patient safety (QPS)

Key results

processes , products

& services

Growth and

learning

Education &

Training

Clinical evidence

base , use of

information

Staffing, staff

management

Medication management and use (MMU)

Anesthesia and surgical care (ASC)

Quality improvement patient safety (QPS)

Facility management & safety (FMS)

Governance, Leadership & direction (GLD)

Leadership

People

Resources' &

partnership

People results

Key results

Financial ------ ------

Resources' &

partnership

Key results


Comparison of model components

Table combines, the components of JCI standards, clinical

governance and EFQM areas with balanced scorecard (BSC)

aspects and the hospital‟s scorecard is developed on this

basis.

Methodology

After integration and investigating the degree of overlap

among EFQM model criteria, clinical governance axles and

JCI standards, the expectations of each one of these models

or, in fact, their objective goals were investigated.

Finally, it was completely determined that all of these

models enjoy the themes of quality and security in the

hospital environment. Therefore, they can be addressed and

given priority over other areas and axles or given lower

priority. The organization‟s scorecard background along

with the strategic goals in each dimension was set as the

basis of the model. Then the overlap of other models with

strategic dimensions and goals was conducted. When the

goals were placed in the scorecard, the tasks of overlap and

finding equivalents were performed more easily because

there was a close match between some criteria of other

models and the organizational goals.

Then, other columns of the BSC that were derived from the

Hasheminejad hospitals integrated BSC model was added to

the present card.

A sample of the scorecard developed at the level of

organization is presented in Table 4….


Hospital performance assessment (HPA) is carried out based

on the BSC on the basis of RADAR logic. In other words,

the results are measured in terms of the degree of achieving

objective goals/indices and monthly general goals, and

reported in a committee consisting of the organization‟s

leader and junior managers. Then, the red points on the

scorecard were discussed based on the achieved results and

the reasons for delay in measures or failure in achieving

expected results were investigated. Finally, some

recommendations are suggested. These recommendations

are either related to the processes and in need of change in

some administrative stages, or they are based on change in

the beneficiaries‟ expectations. The junior managers‟

comments were announced to the organization‟s

administrative managers, and they were asked to program

and administer the reforms. The administrative mangers

provided an operational plan for administering the reforms;

determine the authorities and the administration time and

taking measures towards a systematic and continuous

deployment by the cooperation of mediator mangers. The

efficacy and influence of the operational program were

investigated while administering the program through

measuring the indices or project advance, and the results

achieved from the balanced scorecard were analyzed again

in the meeting by the organization‟s junior managers. The

above cycle was conducted continuously and monthly, and

led to the continuous promotion and improvement of the

organization‟s operation. Since all managerial levels are

engaged in program administration and the implementation

of approaches and processes and because the results of the

organization performance are permanently accessible

through the BSC, they all are able to respond. Not only is

there the possibility to respond to the situation, but the

promotion process is presentable through the scorecard too.

Discussion and Conclusion

Shahid Hasheminejad Hospital is the first Iranian hospital

and organization that has used the BSC model operationally

during a 3 three-year program.

Jack Travet states: To be the first is a distinguishing idea,

but to remain and support this distinction, we should do our

best. Therefore, after other organizations decided to use the

BSC model, especially in the health industry, the

organization tried to create an integrative model. The

promoted BSC that was a combination of EFQM, clinical

governance and JCI models, made it possible for the

organization and its managers to resist and respond to their

needs in influx and desire to use each model requested by a

section of superior organization.


Moreover, one of the fundamental values of the

organization, (that is continuous promotion through

promoted performance assessment system) was actualized.

Due to commitment to organizational values, all managers

and staff believe in continuous promotion and participation

in model implementation and program administration.

Finally, the use of this model combined the results of years

of using EFQM, clinical governance, and JCI model in

organization so that not only did not it result in the managers

and staff‟s fatigue and frustration, but also it was able to be

an appropriate form of the achieved results of years of

continuous endeavor and activity.

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