Strategic Controls in a Healthcare Organization

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Table of Contents

Controlling Function
Strategic Controls
Bibliography

Controlling Function

The controlling function in a healthcare organization may cover the areas of consumer engagement, organizational efficiency, and improved information use for decision-making, patient-care management and performance assessment (Brown et al, 2005). The strategic controls may also extend to various administrative controls like delegation, evaluation, budgetary controls, performance management through balanced scorecard, HR policies and procedures, quality control in patient services.

Strategic Controls

One of the important strategic controls being exercised by the healthcare organization of choice is the budgetary control system. The organization has evolved an overall operating budget, which is drawn up every year, covering all the departments. This yearly budget is broken down into monthly and divisional operating budgets and is communicated to all the departments for strict adherence. A monthly review of the actual performance is undertaken based on the “performance report” to be submitted by each departmental head explaining the reasons for any variance between the budgeted and actual performance. Corrective actions are initiated wherever there are sources of any problem.

On the Human Relations side, there is a well-defined set of guidelines in the form of “Employee Guide”. This guide sets out all rules, policies and procedures to be followed in respect of hiring, compensating and firing of administrative and operating staff at all levels. It also covers the performance assessment and promotions of staff at different positions. This guide has been prepared based on the assessment of the functioning of the organization over a period of time and has been considered as a useful control tool for meeting any HR issues as it covers an extensive area of operations. Similarly, on the physician and patient engagements there are well laid out policy guidelines, which have made the functioning within the organization well controlled to meet the overall organizational strategic objectives.

For the assessment of the overall performance of the organization is following the balanced scorecard approach. The Balanced Scorecard Model of strategic management system was first introduced in the year 1990 from a study of number of companies (Kaplan & Norton, 1996). The study concluded that organisations could not just rely on their financial measures to ensure success in the changing environments. This is more so in the case of organisations that have key success factors based on intellectual capital and knowledge based assets.

The performance metrics included the four perspectives outlined in the balanced scorecard approach cover

Financial,
Customer,
Internal Business Processes and
Learning and Growth (Charles et al, 2002)

Financial Perspective

This perspective provides for an overall improvement in the cost reduction objectives and other financial objectives to be achieved.

Customer Perspective

In the place of customers/patients, the individual service departments will incorporate the objectives to be achieved from the perspectives of all the stakeholders connected with the healthcare organization.

Internal Process Perspective

Alignment of individual departmental strategies with the overall objectives of the organization will provide individual objectives for the Department members the achievement of which will strive to improve the internal process efficiency.

Learning and Growth Perspective

Under this perspective, specific goals for the improvement in the service quality will be provided to the organizational members. The members in order to achieve these objectives will have to improve their knowledge and skill through open communications, and training to fill gaps in knowledge.

On an overall assessment, the balanced scorecard approach aims at translating the mission, vision, and strategic agenda to the reality of daily operations in the organization required use of a process of engaging department leaders and staff to organize their communication structures, employee development programs, and performance activities that would link effective managers and models for staff and team performance. (Helfrich et al, 2002).

Bibliography

Charles, H. T., George, F., & Srikant, D. M. (2002). Cost Accounting: A Managerial Emphasis. New Delhi: Prentice Hall of India Private Limited.

Helfrich, M. J., Filip, J. S., & Hope, M. S. (2002). Strategy Management System in Perinatal Services: The Role of a Patient Resource Manager. Lippincott’s Case Management , 7 (1), 27-42.

Kaplan, R. S., & Norton, D. P. (1996). The Balanced Scorecard.

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