Case Study: Performance Measures that Create Success

Peel medical Hospital (PMH) was embarking on a new revolution of performance management that required an equally balanced plan to address other interdepartmental performance strategies. The employees were worried that the emphasis on personnel would distract from the equally important performance objectives. One way that PMH hope to address this issue was through a balanced scorecard. The main obstacles to PMH reaching their goal were accountability, organizational readiness, aligning performance measures with company objectives (Harber, 1998).

The Scorecard

This scorecard provided 4 main goals to reach a balance between desired performance and actual attainable performance by 1) establishing a framework of performance measures, 2) translate objectives into easily evaluated performance measures, 3) set up accountability standards, and 4) balance quality and production. The main objective of the scorecard was to find out where the gaps were between the desired and actual performance level. Success of the scorecard would be a balance between the two (Harber, 1998).

Hurdle to Success

Peel memorial hospital had challenges to their success which included the lack of measurable goals, undefined objectives and objectives that were unclear to employees and the lack of an articulated vision. The scorecard was created to deal with these issues of a lost company with no direction. Most employees didn't know if the new performance measures would take away from their personal improvement via training and development programs. PMH made major efforts to ensure that all employees new their roles in the change. Communication channels were kept open and employees felt that they could ask questions and those questions would get answered. PMH made sure to involve employees in the change and solicited feedback to help improve the process and this employee satisfaction (Harber, 1998).

The readiness of the company to make change needed to be addresses. Without the understanding of how the organization feels about the change can result in complete failure of a project that never gets off the ground. Readiness is measured by level of leader commitment, perceived appropriateness of change to organization and perceived benefit. PMH may not have made all efforts necessary to satisfy the perceptions and seek the readiness they desire ( Holt, Armenakis, Hubert & Harris, 2007). Resentments were gossip around the office which could result in obstacles to work performance. The company's readiness and preparedness was measured by surveys and probing. It was important to Gauge the level at which the company started and from there where they needed to be, the difference was the amount of change needed to be successful. The evaluation of the organizational readiness also brought light to challenges that needed to be addressed in order to reach their goal. Without these measures, PMH wouldn't know the path they needed to take to reach a balance of performance management (Harber, 1998).

Accountability for themodel'saction plan was required at a team level. Management was required to hold weekly progress meetings. This helped management understand where they progress of the project was and how far away from success they were. The weekly checkups also reminded everyone that the model was a continuous effort that would not be forgotten about nor forgotten no matter how long it took to reach the final goal (Harber, 1998).

The Result

The scorecard initiative was successful. It resulted in a much higher percentage of employee satisfaction than when they started the scorecard initiative 2 years ago. The scorecard model also enabled them to become the lowest cost provider and was given a four year accreditation ( Harber, 1998).

Conclusion-What is lacking?

PMH was successful with their balanced scorecard approach but they missed a few aspects that if incorporated into their scorecard could have resulted in more astounding results.

First off, the performance measures should have offered more analytical intelligence rather than a set of data presented weekly. The type of intelligence that would be useful is an analysis of how well the company uses their resources to produce goods and services.

Secondly, the use of recognition and reward for business segments that produced positive results could have boosted overall progress significantly. Lastly, performance measure evaluations should be opportunities for learning and advancement.PMH did not incorporate enough learning into the evaluations and again, if done may have increased their human asset (Goodwin, 2010).

References

Goodwin, J. (2010). Guide to Balanced Scorecard Performance Management Methodology.

Retrieved from the Procurement Executives Association website at:

http://management.energy.gov/documents/BalancedScorecardPerfAndMeth.pdf

Harber, B.W. (1998). Working Together for Success: The Balanced Scorecard Solution at Peel

Memorial Hospital. Hospital Quarterly. Summer.

Holt, D., Armenakis, A., Hubert, F., & Harris, S., (2007). Readiness for Organizational

Change The Systematic Development of a Scale. Journal of Applied Behavioral Science.

vol. 43 no. 2. Pp. 232-255.