Using a scorecard for strategic results.

that we had superb financial information, but not superb information on quality or community benefit, so that started our organization on a journey to collect that data,” says Michael Connelly, president and CEO of Catholic Health Partners, Cincinnati, for the past 19 years. “It was fundamental to creating a scorecard that would give us a well-rounded picture of our ongoing progress toward achieving our mission and strategic priorities.” From medical charts to employee satisfaction surveys and hundreds of data points in between, the system began gathering its internal performance information 13 years ago, comparing its findings against national benchmarks, with a goal of achieving top quartile performance. At that time, CHP was merging several different regional health systems. Establishing the same scorecard measures for all the merged entities was a vital process in unifying the system’s overall strategy and operations. Jane Durney Crowley, executive vice president of clinical integration and business development, worked with Connelly to develop the methodology for the scorecard based on the mission and vision. “From the beginning, we aimed to select a balanced set [of objectives] — quality, mission, human resources, physician partnerships or growth, and finance,” she says. “The executive management team, including field leaders, debated a draft set of objectives, asking such questions as: ‘Should we work on primary care alignment or post-acute services? Should we emphasize staff retention or leadership diversity?’ “Next, concrete measures needed to be identified or developed for those processes,” she says. “For each measure, we established five levels of achievement — poor to excellent — specifically defined to help us understand performance expectations at each step along the way, so we would know ahead of time what excellent looked like.” CHP uses an independent third party to validate the data gathered and measured. “Many of the scorecard’s design elements have been with us from the beginning,” Crowley says. The first design principle was creating a classic balanced scorecard model that balances all aspects of a business, establishing various categories of financial, quality and workplace performance, and then developing specific measures within each category. The second principle was benchmarking — tying all targets to external high standards of performance, she says. The initial data collection took close to six years and leaders’ first major challenge was to determine what and how many metrics to use. They decided on 15 to 18 systemwide measures “to give us a holistic view of how we are performing,” Connelly says. Measures are chosen annually, based on progress toward achieving CHP’s five-year strategic plan (see Scorecard Breakdown, Page 16). “[The balanced scorecard] creates a set of common goals, which serves to unify any team,” says Cathy Eldridge, chair of the system board as well as chair of CHP’s executive compensation committee. Although the scorecard was already in place when she joined the board nine years ago, it has continued to evolve, adding more Using a Scorecard for Strategic Results Although scorecards that measure health system performance against established metrics have become an increasingly common and useful tool in the trustee’s governance toolbox, finding concrete, comprehensive ways to measure how well the organization is achieving its strategic goals — and, in turn, determining incentive compensation based on goal achievement — can be a daunting, ephemeral task. Here’s how one health care system has successfully connected all the dots. Workbook NOV EMB E R / D E C EMB E R 4