Competing values in healthcare: balancing the (un)balanced scorecard.

EXECUTIVE SUMMARY

Facing a complex environment driven by two decades of dramatic change, healthcare organizations are adopting new strategic frameworks such as the Balanced Scorecard (BSC) to evaluate performance (Kaplan and Norton 1992). The BSC was not originally developed as a performance management tool, however. Rather, it was designed as a tool to communicate strategy and, as such, provides little guidance when actual outcomes fall short of desired outcomes. In addition, although the BSC is an improvement over exclusively financial measures, it has three conceptual limitations that are especially problematic for evaluating healthcare organizations: (1) it underemphasizes the employee perspective, (2) it is founded on a control-based management philosophy, and (3) it emphasizes making trade-offs. To address these limitations, we propose using the Competing Values Framework (CVF), a theoretically grounded, comprehensive approach to understanding and improving organizational and managerial performance by focusing on four action imperatives: competing, controlling, collaborating, and creating. The CVF pays particular attention to the employee perspective, is consistent with a commitment-based management philosophy, and emphasizes transcending apparent paradoxes to identify win-win solutions. Rather than focusing on customer satisfaction or employee satisfaction, the CVF looks for ways to satisfy customers and employees while still addressing financial constraints and growth opportunities. The CVF also can be used to assess both the culture of the organization and the competencies of individual managers, thereby providing a clear link between strategy and implementation.

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For two decades healthcare organizations have faced dramatic changes in technology, demographics, labor markets, compensation and benefit levels, and malpractice claims and awards. Publication of the Institute of Medicine's study of the consequences of medical errors (Kohn, Corrigan, and Donaldson 2000) increased the public's awareness, which created enormous pressure for improving patient outcomes (McFadden, Stock, and Gowen 2006). As legislators addressed patient-safety and quality-of-care concerns, healthcare organizations reevaluated service delivery and performance measurement.

Kaplan and Norton's (1992) Balanced Scorecard (BSC) has become a widely used framework for performance measurement, although the authors originally intended the framework to be used as a tool for communicating strategy (Meyer 2005). Despite the fact that the BSC approach encourages identifying key performance measures that are consistent with an organization's strategy, using it as the primary tool for performance measurement is inappropriate. Furthermore, although the BSC focuses on internal business processes, innovation and learning, and customers in addition to traditional financial metrics, we argue that the fundamental BSC framework still focuses too much on profit and process outcomes and too little on people and the organizational cultures in which they work. This is a serious limitation, particularly in the healthcare industry, where employee knowledge, skills, and commitment are critical not only for organizational performance but also for saving lives.

A gap still exists between actual and desired performance (see, for example, Griffith, Alexander, and Foster 2006), so other tools and techniques should be considered. In this article, we propose the Competing Values Framework (CVF) instead of, or in addition to, the BSC (Quinn 1988). The CVF has been validated as an evaluation tool in various types of organizations. The framework has been used by Kaarst-Brown and colleagues (2004) to evaluate library cultures; by Obendhain and Johnson (2004) to assess organizational cultural types in service organizations; by Goodman, Zammuto, and Gifford (2001) to evaluate the relationship between organizational culture and the quality of work life in hospitals; and by Gifford and colleagues (2002) to create a survey to determine nurse-retention factors. Kwan and Walker (2004, 21) demonstrate the validity of using the CVF to differentiate organizations based on their culture and also note that a literature review "shows that the quantitative assessment of organizational culture has been dominated by studies adopting the competing values framework."

We begin by reviewing critical issues in the healthcare environment and how they affect patient satisfaction. We then outline the healthcare foci and metrics typically identified when using the BSC and the limitations of that approach. Next, we provide an overview of the CVF and demonstrate how it can be used to help expand the foci and metrics considered to identify important drivers of performance overlooked by the BSC. We conclude with a discussion of implications for practice that derive from using the CVF for assessing organizational culture and individual competencies.

CRITICAL ISSUES IN THE HEALTHCARE ENVIRONMENT

Successful hospital performance depends on both the technical aspects and the functional aspects of care. In terms of technical quality, the elimination of medical errors and adverse effects is crucial; lives are at stake. The 1984 Harvard Medical Practice Study, which investigated adverse events from 52 hospitals, generated widespread concern about the quality of healthcare and interest in the measurement and prevention of errors (Studdert, Brennan, and Thomas 2002). The Institute of Medicine estimated that "tens of thousands of deaths and injuries [are] caused by medical mistakes every year"; the Food and Drug Administration estimated that number at nearly 500,000 (McGee 2004, 101). But functional aspects of care (how the technical care is delivered) also need to be considered. Because most patients are not able to evaluate the technical quality of care unless an adverse event occurs, patient satisfaction often is based on functional aspects of care and the cost of care.

Five critical factors that influence patient satisfaction are nursing shortages (Aiken 2002; Altman, Clancy, and Blendon 2004; Buerhaus et al. 2002; Dittus et al. 2005; Unruh, Fottler, and Talbott 2003), lack of adequate technology (McGee 2004), poor communication between patients and medical personnel (Sorra and Nieva 2004; Brach, Fraser, and Paez 2005; Galland 2006), poor internal communication systems (Powell and Hill 2006), and rapidly rising costs. The first four issues directly affect technical aspects of care, raising the incidence of medical errors and adverse effects (Brach, Fraser, and Paez 2005; Buerhaus et al. 2002; McGee 2004). They also affect functional aspects and the cost of care, resulting in an even more negative impact on patients' overall satisfaction with their healthcare experience.

Nursing Shortages

The U.S. healthcare industry has experienced nursing shortages since 1998 (Seago et al. 2006), and estimates have been made that by 2020 the shortage level will reach 29 percent (Cohen 2006). Citing a Chicago Tribune article, CNN (2000) reported that in the five-year period from 1995 to 2000, more than 11,000 patients died or were injured because their nurses were overworked or undertrained. Shortages of nurses also affect functional aspects of care; patients expect prompt responses from nurses when they place calls, so delays that result from understaffing can reduce satisfaction.

Lack of Adequate Technology

Technology is essential for quality improvement (Bradley et al. 2003). However, high implementation costs and cultural barriers have slowed the adoption of new technology programs in hospitals (Menachemi et al. 2006). Although more research is needed on technology-based methodologies, the implementation of radio-frequency identification systems and information technology systems will improve operations and reduce costs (Wicks, Visich, and Li 2006; Menachemi et al. 2006).

Poor Communication with Patients

Even with adequate staffing and technology, high-quality medical care depends on clear and timely communication between medical staff and patients. Tang and Lansky (2005, 3) found that patients need knowledge so that they have the "opportunity to exercise the degree of control they choose over health decisions that affect them." Heisler and colleagues (2003) and Schillinger and colleagues (2003) found that participatory decision making improved psychological outcomes in diabetes treatment, and Greene and Yedidia (2005) found similar results in critically ill patients.

Poor Internal Communication Systems

In addition to enhancing the benefits of physician--patient communication, good internal hospital communication improves the technical and functional aspects of patient care. According to Powell and Hill (2006), the Institute of Medicine states that hospitals should learn from the airline industry and adopt a crew resource management technique that focuses on improving all aspects of communication by developing simple, standardized processes. Crew resource management has been shown to improve employee attitudes, increase team satisfaction, and reduce nurse turnover (Powell and Hill 2006).

High Cost of Care

Cost is an important factor in patient satisfaction, so hospitals have focused on reducing short-run costs. Unfortunately, a short-term focus undermines long-term goals and results in higher costs. For example, a strong emphasis on cost cutting can result in reduced nurse staffing, lack of technological investment, and lack of improvements in internal communication systems.

THE BALANCED SCORECARD APPROACH

Kaplan and Norton (1992) developed the BSC methodology to address the problem of organizations relying too heavily on traditional financial outcome measures, which tend to focus on past performance rather than on performance metrics that help predict the organization's future success. Their intent was to provide a tool that could be used to communicate the strategy of the organization (Meyer 2005). The BSC includes four different perspectives (financial, customer, internal process, and learning and growth) and incorporates multiple measures for each perspective. Kaplan and Norton (1996) emphasize that measures should be linked to strategic objectives, not generic data; should include both outcome and performance drivers; and should be used as the basis for short-term and long-term strategic planning and decision making (Gumbus 2005; Kaplan and Norton 1992).

The BSC approach has been widely used in healthcare, not only as a strategic planning framework (Griffith, Alexander, and Warden 2002; Gumbus, Bellhouse, and Lyons 2003; Lawrie and Cobbold 2004) but also as part of performance measurement systems. Table 1 provides examples of the focus and metrics that a healthcare organization might use in conjunction with each of the four BSC perspectives.

On the surface, the BSC approach appears to provide a valid approach to strategic planning and performance measurement, but the approach also has its critics (e.g., Behnke and Breyfogle 2005; Gumbus 2005; McLean and Mahaffey 2000). Gumbus (2005) found that although 64 percent of companies in the United States use a BSC, not all believe that the approach has lasting value. Some see BSC as a management fad that will be replaced by bottom-line financial measures, especially in times of economic downturn (Gumbus 2005). Part of this mistrust stems from the fact that the BSC approach often is not well implemented, with some companies adopting boilerplate versions of nonfinancial measures (Maiga and Jacobs 2003; McLean and Mahaffey 2000; Ittner and Larcker 2003). These implementation problems can be addressed, but the conceptual limitations of the BSC are more problematic. In a study of hospitals using a system-level version of the BSC, Yap and colleagues (2005) concluded that hospitals need to develop institution-specific scorecards. The authors recommend that efficiency and human resources should be given additional attention. Their recommendations are consistent with our concerns about three major conceptual limitations of BSC: (1) it assumes employee commitment but does not emphasize the employee perspective; (2) it is founded on a management philosophy that is based on control rather than commitment; and (3) it assumes that trade-offs are necessary to solve problems, rather than emphasizing win-win solutions.

Lack of Emphasis on Employee Perspective

The BSC does not specifically include the employees' perspective, despite the fact that Kaplan and Norton (2001, 92) included having a "motivated and prepared" workforce as an underpinning of the framework. The approach "establishes goals but assumes that people will adopt whatever behaviors and take whatever actions are necessary to arrive at those goals. The measures are designed to pull people toward the overall vision" (Kaplan and Norton 1992, 79). Unfortunately, employee motivation and commitment cannot be assumed. The lack of strong focus on the employee perspective is inconsistent with the basic tenets of total quality management philosophy in general and quality initiatives in healthcare in particular. For example, the Joint Commission's (2005) standards include a strong focus on human resource management, as do the criteria of the Malcolm Baldrige Quality Award Healthcare Program.

Management Based on Control Rather than Commitment

With its emphasis on objective metrics, the BSC approach assumes a control-based management philosophy. But in highly competitive and dynamic environments, a commitment-based management philosophy is arguably preferable because it helps organizations respond more quickly to environmental changes (Khatri et al. 2006). Khatri and colleagues also argue that commitment-based organizations foster employee cooperation and trust, thereby reducing barriers to communication--one of the issues identified as critical to both the technical aspects and the functional aspects of healthcare. Status differences often undermine open communication, and a control-based approach emphasizes status differences. In contrast, commitment-based organizations are guided by a set of clear values that employees understand and accept. As a result, the need for specific rules is minimized and employees are better able to respond to unique problems.

Assuming Trade-Offs Are Required

The focus on control rather than commitment is also connected to the third conceptual problem--assuming that trade-offs are required among key variables such as cost and quality (see, for example, Inamdar, Kaplan, and Reynolds 2002). In an organization that assumes that employees cannot be trusted, managers are not likely to assume that employees will go above and beyond their job duties without some incentive. Research demonstrates, however, that employees are more likely to engage in organizational citizenship behaviors in commitment-based organizations and that increased participation in decision making by nurses can result in improved clinical outcomes without an increase in cost (Khatri et al. 2006). Research by Harmon and colleagues (2003) found that high-involvement work systems could help meet the need to both reduce costs of service and attract and retain committed, competent employees for patient care and support. Similarly, management techniques such as crew resource management improve outcomes and reduce costs (Powell and Hill 2006, 178). Although trade-offs are sometimes necessary, assuming that trade-offs are always necessary can result in managers who fail to look for creative solutions that can lead to improvements in one area without sacrifices in another.

Although the BSC moves beyond exclusively financial performance measures, its three major conceptual limitations encourage an organizational culture that undervalues and overworks employees, resulting in reduced quality and increased costs in the long run. Organizational success depends on the ability and motivation of employees to implement the organization's vision. We contend that the BSC is actually unbalanced, and thus it is not flexible enough to allow for the appropriate approaches to be developed, deployed, integrated, and aligned throughout the healthcare system to effectively and efficiently support strategic initiatives. Just as importantly, because the BSC focuses primarily on the measurement of organizational outcomes (consistent with its original purpose of communicating strategy), it provides little insight into the underlying causes of discrepancies between desired and actual outcomes or how to improve future outcomes. To address these limitations, we propose using the Competing Values Framework (CVF) either on its own or as a complement to existing BSC systems (Quinn and Rohrbaugh 1983; Quinn 1988).

COMPETING VALUES FRAMEWORK

The CVF is a theoretically grounded approach to understanding the impact of organizational culture and managerial behavior on organizational effectiveness (Cameron and Quinn 2005; Quinn 1988). It is consistent with the commitment-based philosophy advocated by Khatri and colleagues (2006) for reducing medical errors and improving quality of care by focusing on the impact of human resource management practices on employee behavior and clinical outcomes. Rather than accepting trade-offs as a necessity, the CVF emphasizes looking for ways to generate win-win outcomes by simultaneously focusing on four key action imperatives: compete, control, collaborate, and create (Quinn et al. 2007). The CVF also emphasizes the importance of the ends and means of achieving balance within each action imperative.

The four action imperatives, with the inclusion of the ends and means, create a more comprehensive framework than earlier organizational culture models did. "CVF concisely captures the tensions between the different models, highlighting the paradoxes that managers face" (Gifford et al. 2002, 17). It creates a "rich visual representation of an organization's culture" (Goodman, Zammuto, and Gifford 2001, 65). The CVF is particularly appropriate for service organizations, such as hospitals, where the culture is based on group values (Obendhain and Johnson 2004). In addition, the challenge of nurse retention in hospitals is best addressed by improving the quality of work life by increasing nurse autonomy and control and by enhancing relationships (Gifford et al. 2002)--key loci of the collaborate action imperative.

The CVF approach was developed by integrating multiple theoretical management perspectives into a single framework (see Quinn 1988 for a comprehensive discussion of these models). Early models of management tended to focus on control. Some models, such as scientific management, emphasized internal process control; others, such as the rational goal model, emphasized control in relation to the demands of external customers. However, as practitioners and researchers continued to examine the outcomes of these approaches, they identified problems. New models that focused more on flexibility emerged. The human relations school of thought began to recognize the importance of flexibility when dealing with employees inside the organization, and the open systems school of thought began emphasizing the need for flexibility when dealing with the external environment. The CVF combines all four of these approaches in a single model that encourages an emphasis on both control and flexibility and both internal and external factors. Because the CVF can be used at multiple levels of analysis, it can be helpful in promoting the type of culture needed for successful quality improvement efforts (Bradley et al. 2003).

The CVF incorporates all of the perspectives found in the BSC approach and places greater emphasis on the importance of people relative to profits and processes, both theoretically and in practice. For example, despite the growing use of the BSC technique in the healthcare industry, ongoing problems with staffing levels suggest that some organizations still may be overemphasizing financial concerns, to the detriment of patient care. The current nursing shortage peaked in 2002, with 95 percent of nurses reporting staffing shortages during 2001. But shortages were still reported by 82 percent of nurses in 2004, even after 185,000 nurses were added to the hospital workforce (Buerhaus, Staiger, and Auerbach 2006). Overworked hospital staffs are unlikely to think innovatively or to learn new ways of doing things when they are working excessive amounts of overtime. The financial pressures faced by hospitals and other healthcare organizations are very real, but it is not clear that the best solution is to forgo hiring the numbers of nurses needed to provide adequate patient coverage.

As shown in Table 2, all of the healthcare foci and metrics that are included in the BSC approach also fit within the CVF. What is different is the emphasis placed on the collaborate and create action imperatives. Although some of the metrics associated with the BSC learning and growth perspective are appropriate for the collaborate action imperative, additional metrics are needed to fully address the broader healthcare focus associated with that action imperative--improving employee satisfaction. In addition, the CVF approach helps to highlight the relatively slight emphasis on actual innovation and growth found in the BSC. For simplicity, Table 2 highlights foci and metrics that are most directly affected by the action imperative shown, rather than by all action imperatives, as the CVF would predict.

The CVF recognizes that managers often face situations that appear to require trade-offs. Organizations need to address the fundamental tensions between control and flexibility and between external issues and internal issues. In contrast to other approaches such as the BSC, however, the CVF approach does not accept the assumption that these tensions necessarily require trade-offs. Instead, the CVF approach embraces paradoxical thinking and looks for ways to transcend paradox and achieve objectives that initially appeared to be in conflict. For example, because employees play a major role in caring for patients, creating value, and containing costs, addressing employee concerns can have a positive impact on outcome measures such as patient satisfaction and financial performance. Conversely, decisions to cut costs by reducing staff can actually result in higher costs. For example, Buerhaus (2005) found that more than 80 percent of survey respondents thought that nursing shortages affected the timeliness, effectiveness, and efficiency of care, which affect patient satisfaction levels. The study also found that more than 67 percent of the respondents thought that shortages affected safety and equity of care, which are directly related to the costs associated with medical errors and other adverse events. The recommended actions of the study were primarily strategic in nature: change the workplace environment, improve the contributions of nursing to patient quality and safety initiatives, develop a long-term focus, fix problems that restrict the capacity of nursing-education programs, promote a balanced and professional image of nursing, improve diversity in the workplace, and recognize that changes in the workforce are possible.

Researchers in the healthcare industry have called for a variety of changes that reflect the need for hospitals to address all four of the CVF action imperatives. For example, Abernethy and Lillis (2001) state that for hospitals to compete effectively, organizational strategy must be changed to focus on innovation, flexibility, knowledge, and enterprise-based systems and that self-managed teams and a strategically designed management system must be implemented. Hospitals need to operate in a more entrepreneurial manner to be more responsive to patient demands (Habib and Victor 1991; Slater and Olson 2000) and must implement efficient operating systems (Abernethy and Stoelmender 1995; Abernethy and Chua 1996). The adoption of service innovation techniques is critical to the development of competitive strategies in rapidly changing healthcare markets (Carman et al. 1996). A culture that facilitates innovation and creative thinking must be developed (Naman and Slevin 1993). The organizational structure must facilitate the efficient flow of information, both horizontally and vertically, to develop collaborative delivery of core healthcare services within the organization (Bouwens and Abernethy 2000). These types of changes cannot occur if employees are not intimately involved in identifying and implementing new ways of providing healthcare services.

IMPLICATIONS FOR PRACTICE

Somewhere along the road to managed care, many healthcare organizations appear to have lost their reputation for valuing the nurses, lab technicians, staff, and even physicians who are the lifeblood of quality healthcare. Whether it is true or not, if employees of healthcare organizations perceive that they are only replaceable cogs in a medical machine, the quality of healthcare will decline. Using tools such as the BSC, which omits any mention of the employee perspective, will only exacerbate healthcare employees' negative perceptions. Using the CVF, with its emphasis on mentoring and facilitating employee success, may help to signal the importance of healthcare workers in the organization. Although this is only a first step, it is important to begin to rebuild healthcare employees' trust in their organizations.

Of course, simply collecting CVF measures is not enough. Employees must see real changes in how their organizations are managed before they will recommit to the organization. In addition to soliciting feedback from employees, the CVF also encourages collaboration. Developing teams to address problems shows a commitment to working with employees and should improve communication throughout the healthcare system. Using teams might also help address some staffing issues. For example, the team members working on a patient's case can share knowledge and job duties in case of absenteeism.

Pfeffer and Sutton (2006) note that when people are dissatisfied with the status quo, are clear about the direction they need to take, see that others are confident that the change will succeed, and accept that change is a messy process, they are more likely to embrace change. The problems with the status quo in healthcare are well documented. The CVF is based on tensions between different organizational foci. Thus, although it recognizes that organizational change is likely to be messy, it also helps clarify how changes in one part of the system will affect other parts of the system. As a result, it is easier to understand what needs to be done and to anticipate the consequences of planned changes.

Various tools have been developed based on the CVF, and they are available through Competing Value Services (www.competingvalues.com/). These tools can help an organization align its culture with its goals and help employees develop the skills needed to accomplish those goals. For example, instruments are available that enable organizations to understand their current culture in terms of the CVF and to project the type of culture that members of the organization prefer. By collecting this type of data from a sample of hospitals, comparisons can be made to help determine which type of culture appears to be most highly correlated with key quality-of-care measures such as mortality, morbidity, and medical errors.

At the individual level, managers can use the recently refined CVF Managerial Behavior Instrument (Lawrence, Lenk, and Quinn, forthcoming) to identify ways to improve their skills and, in turn, enhance their organization's effectiveness. Managers complete a self-assessment and can use the tool to collect 360-degree feedback that will help them identify discrepancies between their own perceptions of their performance and the perceptions of their superiors, peers, and subordinates. Data from managers also can be reviewed relative to the culture of the hospital to help align individual behaviors with the organizational culture in support of strategic objectives. Focusing more intently on internal, individual level variables such as these can be especially valuable for identifying potential roadblocks to successfully implementing new programs and procedures in the organization. In contrast, the BSC only provides measures of actual organizational outcomes and offers no clear guidance on how to improve those outcomes.

In sum, the CVF's emphasis on the employee perspective; its consistency with a commitment-based management philosophy; its openness to transcending apparent paradoxes and identifying win-win solutions; its ability to help diagnose the causes of gaps between actual and desired outcomes and problems; and its insights into how to reduce those gaps by aligning individual behavior, organizational culture, and strategic goals make it an excellent choice for healthcare organizations that seek to improve the technical and functional quality of healthcare while maintaining or reducing costs.

PRACTITIONER APPLICATION

Charles S. Kinney, FACHE, president, The Westerly Hospital, Westerly, Rhode Island 

This article by Wicks and St. Clair presents an interesting perspective on the philosophy that an organization follows to measure its performance--the Balance Scorecard or the Competing Values Framework. The metrics used in each approach overlap significantly. The differences appear to be in the categorization of the metrics--the "perspectives" framework and the "action imperatives" framework. The metrics an organization uses are based on the culture and strategy of that organization. The metrics provide the focus. (If you cannot measure it you cannot change it.)

The gap between actual and desired performance will not change with either framework, unless the organization is committed to acting on the variances. Denial, excuses, and rationalization are strong barriers to change. The organization must be committed to change; otherwise, metrics are not important. The fundamental questions deal with the organizational culture: How much does the organization value its employees? How does the organization demonstrate the value it professes to have? How does the organization measure the value? The answers will differ depending on the hospital setting--that is, issues in a small hospital will be different from those in a large urban teaching facility. Culture beats strategy every time.

For a number of years, I have used the principles and approach taught by Quint Studer, author of Hardwiring Excellence. The basic philosophy of this approach is that people are the most important organizational asset. One cannot sustain very good quality and service with a disgruntled, disengaged, uncommitted, or unsupported workforce. People drive service (patient satisfaction); they also drive quality. Service and quality drive growth, and growth drives finances. As a result, our organization has goals (metrics) in the "five pillars": people, service, quality, growth, and finance. Under the people pillar, we measure retention (not turnover), percentage of filled positions (not vacancies), time to fill positions, continuing education, use of agency staff, overtime, and management rounding. Last year, during our union negotiations, the goal of the negotiations fell under the people pillar, not the finance pillar.

In Jim Collins's book Good to Great, he describes the flywheel concept. Studer has updated this for healthcare. At the center of the flywheel are purpose, worthwhile work, and making a difference. This is why our staff got into healthcare in the first place. We think about the commitment our staff makes every day to care for members of our community. Do we reinforce the fact that our staff makes a difference in people's lives? Do we reinforce that our staff's work is worthwhile? Do we reinforce that there is a purpose to what our staff does? Or do our systems and culture take purpose away from our staff?

The turning of the flywheel is based on principles that drive pillar results (metrics) and passion--each one pushes the other to move the flywheel. As they reinforce each other, the flywheel gains the necessary momentum.

At the end of the day, metrics are important. However, what you do with the results is even more so.

For more information on the concepts in this article, please contact Dr. Wicks at [e-mail].

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TABLE 1
Healthcare Foci and Metrics Using the Balanced Scorecard

Perspective     Healthcare Foci      Healthcare Metrics

Financial       Maximizing           Clinical, operational,
                revenues and         and financial
                managing costs       indicators

Customer        Patient metrics,     Patient satisfaction
                volume, and          survey scores; patient
                market  share        safety; Joint
                to increase          Commission
                ambulatory           accreditation;
                presence and         expanded clinical
                the promotion        services; coordinated
                of health and        clinical care centers;
                wellness             increased ambulatory
                                     volume

Internal        Cycle and            Time to admission;
business        turnaround           length of stay; number
process         times to enhance     of physicians connected
                efficiency           to hospital clinical
                                     information systems

Learning and    Employee learning,   Vacancy and turnover
growth          innovation, and      rates, employee
                growth               development plans;
                                     employee satisfaction

TABLE 2
Healthcare Foci and Metrics Using the Competing Values Framework

Action           Healthcare Foci          Healthcare Metrics
Imperatives

Compete       * Maximize revenues     * Clinical, operational,
                                        and financial indicators
                                        (e.g., volume, market
                                        share)
              * Increase patient      * Patient satisfaction
                satisfaction            survey scores; patient
                                        safety
              * Increase ambulatory   * Expanded clinical
                presence                services; coordinated
                                        clinical care centers;
                                        increased ambulatory
                                        volume
              * Improve reputation    * Joint Commission
                                        accreditation;
                                        Baldrige award
Control       * Enhance efficiency    * Cycle and turnaround
                to reduce               times; time to
                operating costs         admission; length of
                                        stay; number of
                                        physicians connected to
                                        hospital clinical
                                        information systems
Collaborate   * Improve employee      * Vacancy and turnover
                satisfaction and        rates; employee surveys;
                work systems            employee tenure

              * Enhance employee      * Employee development
                learning                plans and certifications
                                        earned
Create        * Innovate              * Investment in new
                                        technology
              * Grow                  * Community partnerships/
                                        outreach
              * Promote health and    * Number of people
                wellness                participating in
                                        wellness programs