Metrics, Scorecard, KPIs

Performance management experts agree that scorecard systems are the means to an end. The end is usually in the form of attaining a specific company goal. The means, not being the factors to achieving success, are ways to realizing strategies that lead to obtaining the goal. This can be best explained by identifying the elements involved in implementing the system. And it also involves the identification of the four dimensions covered by such system. Most organizations follow the same metrics. In the health care sector, the case is special. That is why they are urged to adopt a health care facilities scorecard system.

Scorecards do not work without the necessary metrics or key performance indicators. These are specified areas of a health care organization where outputs are evaluated, results are analyzed, and reports are obtained to make crucial decisions. Health care providers are different from most types of business. That is why its indicators are also quite unique. The four KPIs or dimensions used in the scorecard system are customer perspective, social accountability, internal processes, and financial.

Customer perspective is one dimension that involves reviewing people’s perception and experience. Normally, it involves the process of obtaining the expectations of a customer before he is admitted and inquiring about the effect of the service offered by the facility. It also requires the knowledge of how customers think of the availability of medical equipment, the quick response of the staff, and the overall cost of the treatment.

On the financial side, the indicators are usually drawn from certain aspects, such as developmental cost of new facilities and medicines, profit from operation, and accounts receivable. By measuring this area, health care managers will be aided in making judgments based on financial performance and progress.

The operational dimension, on the other hand, has something to do with activities related to the everyday activities of the health care provider. Usually, these are: the number of queues, express patient arrivals, volume of surgical incidents, whether outpatient or inpatient, time for new medicines and facilities to develop, and average duration a patient stays in the clinic.

The fourth dimension of the health care scorecard system is social accountability. Since health care providers are service oriented, it is important that the organization’s corporate responsibilities must be felt and made visible in the community. Examples of measurable social activities are health education seminars, public heath care programmes, employee development, health awareness initiatives, promotion of proper waste disposal, and charity involvements.

It is not all the time, though, that health care managers should focus on all four dimensions, as it would become a waste of time to spend more on areas that produce unnecessary results. For leaders to practically measure crucial areas, the factors of the scorecard system must be clearly identified. There are actually six and these are: units of analysis, purpose, audience, method, data, and results.

By examining the factors, managers can allocate their time and funds efficiently. In the audience factor, for example, if there is a large number of patients and workers to evaluate, full attention and financial aid must be given. Remember that every second, every dime, and every activity matters. So for health care facilities scorecard to work, one should identify the indicators and consider the factors.

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Every aspect of business is measured by financial metrics. These are necessary to measure if any investment is worth keeping or if any process change will significantly impact the company’s finances negatively or positively. What is being measured here also is the financial value of any project that is undertaken, especially if the project will impact operations. The very goal of measuring finances is to cut on costs or improve how money is spent all throughout the organization.

There are principles that should be followed so the numbers that will be calculated are all accurate and true. If the finances calculated include previous data that should never have been part of the metrics to begin with, this will show an unbalanced figure. The action plans and understanding of the issue at hand will be polluted and it is very likely that the organization will take the wrong direction.

Overhead

Whenever finances are concerned, the overhead expenses should be included in the calculation of financial revenue. Overhead expenses include the money spent on support groups that do not really generate income. This includes salaries of individuals who work the Human Resources Department. This also includes security officials and other people who work certain tasks that may be considered as add-ons. We may also include expenses incurred on materials, such as bond papers and office supplies. When these figures come out, one will immediately see when to cut costs and where.

Future Project Costs

It is also wise that future project costs are included in the calculation. This has something to do with the costs that will be incurred should the projects materialize. The downside of this is that some people may want to hinder the progress of the project once they see the associated costs. It should be well defined what revenue the project would bring so this does not happen.

Historical Data

A mistake that a lot of managers make in calculating finances and returns is that they factor in historical data and paid items that should not be included in the report. For example, there is no balance in including the previous months’ expenses if what you are calculating is only for this month. This will give you inaccurate forecasting. Including historical data is all right if you are calculating annual revenue or if you have a quarterly business review. Always make sure that the timeframe fits the actual financial review.

Pending Costs and Revenues

The financial report should also contain pending costs or debts that are supposed to be paid in the given periods. Many companies have debts that they need to pay monthly and these numbers should be factored in a financial report to ensure accuracy. However, the total cost per annum should not be compounded. This means if the review for financial revenue is only for three months, the assets and liabilities should only include what is present and what is due for three months.

Money is the bloodline of every business. Keep in mind that if the financial metrics are calculated the wrong way, this will also result to misleading action plans, thus putting the organization farther down the drain instead of up.

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Motivating employees is a necessary step that every business owner should take to succeed.   This is because motivation encourages better performance and productivity on the part of employees.  And when this happens, the company has nothing to enjoy but benefits and profit.  Hence, it is natural for owners, managers, and team leaders to look for ways to improve the morale of their workers.  But before doing so, they must understand employee motivation KPI.

Key Performance Indicators, or popularly termed as KPI, are helpful tools that assess the performance of a specific area of the business operation.  Take note that a single company may use several KPIs.  It must be understood that each area or even department has its respective KPIs.  This means that KPIs intended for the Human Resources Department are not applicable to the Finance Department of the business.  In the same way, KPIs designed for an employee motivation program should be different from training program.  The reason here is that every area or program has its own goals and desired outcome, which are to be measured by these KPIs.

Let us try to focus on employee motivation program.  The common goal here is to increase productivity of employees.  Therefore, the KPIs should be activities that are able to measure the productivity of the workers.  The employee who works the sales department, for example, of the company would have his productivity pegged at the sales that he or she garners for the company.

From another perspective, you might also wonder why motivated employees bring much profit.  There are several reasons for this and one of them is the development of a happier working environment.  It is a fact that employees with high morale are happy people.  In effect, they can influence co-workers to be happy and content individuals as well.  This attitude can also be the very thing that can enhance teamwork in the office setting.  A positive atmosphere also improves the way employees accommodate their clients.  Since they are happier people, they consequently become more patient in dealing with the needs of their customers.  In most cases, they can deliver well.  By doing so, they increase the chances of the company gaining more profit.

Now the question is: what can be done to boost the employee morale?  Giving incentives is the best answer here.  Most companies create a so-called incentive program for their workers.  Common incentives are in the form of cash, tour packages, bonuses, or gift checks.  However, it should not be ignored that there are other ways to motivate employees aside from incentives.  All of us need some appreciation, especially for our individual accomplishment.  Thus, it pays for the management to show their appreciation to their workers, especially for jobs well done.  A commendation can be a good way to express to an employee that the company acknowledges his or her achievement.  It is also important for business owners to communicate openly with their workers.  They should find out how their employees feel about their work and also determine what their needs are.   Implementing employee motivation KPI could help enhance the relationship between employer and employee.  Remember that the company could definitely benefit from a good employer-employee relationship.

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