The Root Cause of Hospital Inefficiencies

Management issues within hospitals are some of the most significant contributors to the inefficient balancing of cost and quality in healthcare. Sharing information is often seen as dangerous in the old-fashioned bureaucratic system that many hospitals in the US adhere to. Because of this, hospitals are not operating at their maximum capacity and patients are not getting cost-effective care. This issue can be resolved through taking organization-wide initiatives that focus on patient needs and improving transparency of information within a hospital and hospital system.

The Importance of Patient Outcomes

Hospital leaders are influenced by many factors in their decisions; above all, they must always consider patient outcomes. In the past, many hospitals have set objectives for their staff without considering the patient’s welfare or without actively monitoring patient progress, resulting in a lack of improvement or even dishonest behavior. For instance, the Veteran’s Administration was recently involved in a scandal where managers fabricated data to fake success in achieving their goals. These managers were being rewarded for meeting their objectives of reducing patient wait time; however, in reality they were just manipulating schedules to cover up the fact that they were overwhelmed with patient traffic while receiving no guidance for improving their internal operations.

Ways to Improve Hospital Operational Efficiency

Set Clear Goals & Metrics

One of the most important steps for hospital leaders to take to improve organizational efficiency is to set goals for their hospital with a strong focus on meeting patient needs. The managers at Veteran’s Affairs were able to get away with falsifying data for as long as they did because they were not actively monitored and because a lot of the organization’s data was kept very private.

For hospitals to avoid a situation like this, leaders must establish a clear purpose for the organization and set up accompanying metrics that are instrumental in advancing patient care. Some hospitals have faced issues in achieving their goals by initializing many, poorly-designed initiatives. Instead, the most efficient way for a hospital to deliver better care while tracking progress is to set up several metrics that are most suitable in terms of patient experience. The Children’s Hospital of Eastern Ontario does a great job in this regard: they only utilize five metrics, but they are all extremely relevant to bettering patient care. They track metrics such as average waiting time experienced by children throughout their appointment that allow them to easily assess the success of their care delivery and set goals for the future.

Utilize a Management-By-Process System

In addition, hospitals should move toward a management-by-process system, where hospital executives understand all daily operations and provide leadership to frontline leaders in order to improve their processes. This way, lower-level leaders can be given control over their daily management decisions with the freedom to change processes. They can have this jurisdiction because they are always being looked over by managers who will guide them toward delivering more efficient care. To supplement these patient-oriented goals and metrics, hospital leaders should encourage active communication of information across the hospital management level. To enforce a management-by-process system and meet the goals for their facility, it is instrumental for a hospital to share information across levels of management so that progress in patient care can be monitored and priorities can be understood.

An example of a health system that does this is San Francisco General Hospital (SFG), a very large health care organization with many levels of management. At SFG, all layers of management communicate directly on a daily basis to align the priorities of the hospital. The chief operating officer (COO) meets with managers of different departments on a weekly basis. At this meeting, the COO facilitates a discussion about the hospital’s problems and helps the managers coordinate a proposed course of action. The COO guides the lower-level managers toward understanding what problems the hospital is facing and what each one can do to improve the situation. Because of the active communication promoted among the hospital’s management levels, San Francisco General Hospital is able to operate resourcefully and significantly improve the experience of their patients. For instance, SFG’s 3M Surgical Clinic has implemented 23 patient-based initiatives in the last year, resulting in a 76% shorter average duration appointment for patients (from 206 minutes including check-in, rooming, physician visits, and waiting to 49).

Learning from the successful management practices mentioned at SFG and CHEO in addition to the recent Veteran Affair’s fiasco, hospital leaders should work to establish a solid groundwork for their hospital, starting with an organization-wide focus on improving patient care. To further develop this groundwork, they should establish goals and metrics around their patients’ needs and institute a management-by-process system with increased communication and visibility of information. Managers must communicate with one another and monitor their staff while simultaneously giving them the freedom to make strategic management decisions.

Integrate Data with the Cloud

To complement these tasks, hospital leaders should work to move their hospitals to the cloud to make hospital data and processes available to all involved. This transparency will facilitate the convergence of organization-wide goals from hospital management. In addition, by integrating their organization into the cloud, hospital leaders can easily track the progress of employees toward these objectives. By harnessing the power of the cloud, hospital leaders can take an easy and critical step toward streamlining the hospital’s operations, ultimately leading to improved quality of care for their patients.

Toussaint, John. Hospitals Can’t Improve Without Better Management Systems. Case Study. Harvard Business Publishing, 2015. Web. 21 October 2015

Request a demo for your facility!