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Process literacy, process control and demonstration of improvement, and linking of vision to improvement may all help health care organizations improve care and achieve stability in health care delivery processes. PERFORMANCE IMPROVEMENT IN HEALTH CARE ORGANIZATIONS
Using the Baldrige Management System Framework in Health Care: The Veterans Health Administration Experience WILLIAM B. WEEKS, MD, MBA LEIGH HAMBY, MD ANNIE STEIN, RN, MS PAUL B. BATALDEN, MD
he Veterans Health Administration (VHA) is one of the largest integrated health care systems in the United States, providing services for an eligible population of 20 million veterans of the armed forces. The VHA, which is funded with an
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annual budget of more than $17 billion, consists of 173 hospitals and more than 1,000 other sites of care delivery, and 200,000 salaried staff, including physicians. It is the largest provider of graduate medical and other health care professional training and one of the
William B. Weeks, MD, MBA, is Assistant Professor, Depart-
Office, Washington, DC, and a Presidential Award Examiner. She organizes the Quality Achievement Recognition Grant application and granting process. Paul B. Batalden, MD, is Professor, Departments of Pediatrics and Community and Family Medicine and Director, Health Care Improvement and Leadership Development, Dartmouth Medical School. He is a judge for the VA Quality Achievement Recognition Grant. Please address reprint requests to William B. Weeks, MD, MBA, Hub Site Senior Scholar, VA National Quality Scholars Fellowship Program, VAMC (11Q), White River Junction, VT 05009; phone 802/291-6285; fax 802/291-6286; e-mail
[email protected].
ments of Psychiatry, Community and Family Medicine, Dartmouth Medical School, Hanover, New Hampshire; Hub Site Senior Scholar, VA National Quality Scholars Fellowship Program, Department of Veterans Affairs (DVA); Director, Center for Learning and Improvement of Patient Safety, White River Junction, Vermont; and a member of The Joint Commission Journal’s Editorial Advisory Board. Leigh Hamby, MD, is Instructor, Department of Surgery, Dartmouth Medical School, and Fellow, VA National Quality Scholars Fellowship Program. Annie Stein, RN, MS, is Clinical Program Manager, Office of Performance and Quality, VHA Central Copyright © 2000 by the Joint Commission on Accreditation of Healthcare Organizations
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THE JOINT COMMISSION Article-at-a-Glance Background: In 1998 the Veterans Health Administration (VHA) developed the Quality Achievement Recognition Grant, a competitive grant application open to all Veterans Integrated Service Networks (VISNs) within the VHA system and based on the Baldrige management framework. Eight of the 22 VISNs attended the educational programs and initiated the grant application process; 7 completed applications. Team award experts from VHA and external sources reviewed, scored, and wrote feedback reports to all applicants and conducted four site visits. Identification of best practices and recommendations for future applicants: Each application was compared to examples of ideal applications to identify areas of excellence and areas for improvement. In general, the best applicants identified and described key processes and articulated the methods used to evaluate and improve processes. For example, they were
largest clinical research organizations in the United States. The VHA has undergone unprecedented structural reform during the past few years. According to its strategic plan, Prescription for Change, the VHA has sought to transform itself from a system that was hospital based and specialty focused to one focused on primary and ambulatory care. In 1995 the VHA consolidated its health care organizations into 22 Veterans Integrated Service Networks (VISNs), communitybased networks of care which integrate primary through tertiary care services. One objective in the VHA’s strategic plan was to “promote a VHA culture of ongoing quality improvement that is predicated on providing excellent health care value.”1(p 24) The Malcolm Baldrige National Quality Award was the suggested framework to achieve that objective. Although each facility in the VHA system was accredited by the Joint Commission on Accreditation of Healthcare Organizations (Oakbrook Terrace, Ill), top management was compelled by the Baldrige framework’s emphasis on best practices to move beyond compliance, toward excellence. The Quality Management Institute at the Durham (NC) VA Medical Center first developed and disseminated course work and educational materials on the management model underlying the Baldrige assessment process in 1995. The
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able to identify the process used to incorporate key constituents into the strategy development process. One applicant developed a series of management advisory committees, the membership of which includes veterans’ service organizations, academic affiliates, community members, and congressional delegates, which were tapped to develop a strategic plan. Leading applicants in the future are likely to be able to demonstrate evidence of deployment and constant review of the strategy and to emphasize the human resources plan into the strategic planning and deployment. Conclusions: The Baldrige management framework is a useful tool for identification of areas of achievement and areas for improvement within the VHA. Potential applicants for the award could benefit from ensuring coherence across the application, placing a greater emphasis on work systems, and incorporating more extensive analysis of market conditions.
VHA’s use of these models and assessment methods was formalized through the development of the Quality Achievement Recognition Grant in 1998.2 This grant, which was open to each of the 22 VISNs, offered three potential monetary awards: $1 million, $500,000, and $350,000. Winners were expected to use the award to further enhance quality of care and to share best practices to improve overall VHA health care delivery. Health care use of a general quality award mechanism for organizational review and assessment is relatively new. The first national quality award winner in the health care services industry, the pulmonary clinic in Linköping, Sweden, won the Swedish National Quality Award in 1997. In anticipation of increased use of general quality awards in health care, in this article we review the application process and the survey results for the VHA Quality Achievement Recognition Grant. We then identify best current practices from within the applicant pool and suggest areas for future applicants to stress, drawing from an idealized health care delivery system. Finally, we suggest lessons that may help health care systems improve care for the population served.
Application and Judging Process The grant application process was developed in spring 1998 and announced in the summer. An application
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packet, which defined the application and scoring process, was sent to each of the 22 VISN network directors. Special educational programs designed to facilitate the grant writing were offered in September 1998, and grant applications were due December 15, 1998. Applicants were expected to complete a modified Malcolm Baldrige National Quality Award application. Seven of the 8 VISNs that attended the educational programs and initiated the grant application process sent completed applications. Team award experts from VHA and external sources reviewed, scored, and wrote feedback reports to all applicants. Four VISNs were chosen for site visits. In January 1999, teams active in the initial review process conducted week-long site visits at each of the four semifinalist sites. After the site visit, each team leader presented his or her site’s application to a panel of health care quality improvement experts. The panel evaluated the applications and the field report presentations across the seven Baldrige categories. Its findings were presented to outside judges, who were asked to independently review the findings and score the application. For scoring purposes, the Quality Achievement Recognition Grant used the assessment framework of the Malcolm Baldrige National Quality Award and the model of management underlying its measurement system framework.3 However, in an attempt to emphasize performance results, the Quality Achievement Recognition Grant assigned different weights to individual items and categories from those used in a traditional Baldrige application for health care.4 Compared with the traditional Baldrige framework, the leadership, staff focus, and process management categories were relatively underweighted in the VHA scoring mechanism; the strategic planning, patient and customer focus, and information and analysis categories were emphasized. The performance results category was heavily weighted in the VHA application, accounting for 75% of the total number of points potentially awarded. Further, performance indicators were centrally determined and were made available to all potential applicants. To maintain the highest standards, recognition was given only to those entities that demonstrated organizationwide excellence in deploying the Baldrige criteria. On the basis of each applicant’s score and the judges’ comments and recommendations, the VHA
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awarded one VISN the third-place award of $350,000 and two VISNs honorable mention. The application and judging process is represented in Figure 1 (p 382).
Identification of Best Practices and Recommendations for Applicants We reviewed each of the seven completed applications and feedback reports to identify best practices within the VHA system and areas for improvement across the system. Although none of the applications received the highest award, areas of innovation and excellence were evident within each application. We systematically compared each application to examples of ideal applications4,5 to identify areas of excellence and areas for improvement. Best practices were areas where applicants met Baldrige criteria expectations; areas in which the expectations were not met were designated as areas for improvement. The results of this review are shown in Table 1 (p 383). In general, the best applications clearly identified key drivers of the work and results in each of the categories and wove them into their descriptions of each of the categories; focused on the role of leadership and emphasized, through clear description of processes, “management by fact”; and clearly identified and described key processes and were able to articulate the methods used to evaluate and improve processes. We also identified areas that were not given enough attention by applicants. In the future, successful applicants should also focus on the future of the VISN by demonstrating methods to identify and exploit local market needs and enhance operating revenues; articulate the way that the human resources department contributes to each of the categories; and identify methods used to proactively assess and mitigate risk. In the remainder of this section, we describe the best practices and suggestions for future applicants for each category. Leadership The best applicants demonstrated how the leadership managed by fact and incorporated references to all the other categories to support that management process. For instance, one applicant used surveys and
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THE JOINT COMMISSION The Grant Application and Judging Process Refinement of educational programs Summer
Announcement of initiative
Draft of Quality Achievement Recognition Grant criteria
Grant application sent to all VISNs
Educational sessions
Grant application deadline
January 1998
Spring
Summer 1998
September 1998
December 1998
Trophy presented
Feedback reports distributed
Final presentation and judging
Site visits
Choice of semifinalists
Summer 1999
April 1999
March 1999
January 1999
January 1999
Figure 1. The development of the Quality Achievement Recognition Grant and the application and judging process are depicted. VISNs, Vet-
erans Integrated Service Networks. New application and judging process cycle starts in summer.
information technology to feed current information on a range of business drivers to managers and leaders to guide their decision-making process. Through their management practices, the best applicants were able to eliminate functional redundancy and communicate their vision to their stakeholders. For example, one applicant made the transition from facility-based leadership and delivery systems to network leadership and delivery, eliminating the facility-based leadership positions in the process. Finally, leading applicants were able to show that they have a systematic approach to the improvement of the leadership system. One applicant used 360-degree evaluation of leaders to improve the leadership system; one applicant incorporated the evaluation of leadership activities into the evaluation of the strategic planning achievements. Future applicants will likely benefit from focusing the leadership section on what leaders do rather than how they are structured. Further, they might emphasize the functional impact of structural changes over the structural changes themselves. In addition, future applicants are likely to benefit from identifying how leaders have developed a learning organization
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and how they have exploited that learning to reduce bureaucracy. Future applicants will probably benefit from linking their human resources planning with what they need to remain a viable, competitive alternative in their community. Strategic Planning The best applicants were able to identify the process by which they incorporated key constituents into the strategy development process. For example, one applicant developed a series of management advisory committees, the membership of which included veterans service organizations, academic affiliates, community members, and congressional delegates, which were tapped to develop a strategic plan. The best applicants were able to link tactics and strategies to organizational goals and could demonstrate an evaluation process of the effectiveness of those tactics and strategies. One applicant incorporated an ongoing process of achievement and evaluation of the implementation of the strategic plan into the strategic planning process. This information was then used in long-term strategic planning. In addition, the best
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Table 1. Review of the Seven Completed Applications and the Feedback Provided by the Evaluation Teams
Category
1998 Successful Applicants Demonstrated:
Future Successful Applicants Are Likely To:
General
A focus on key drivers and linkage of each category to those drivers A focus on leadership and management by fact Clear identification of processes and methods to evaluate and improve processes
Identify and exploit local market needs Identify ways to enhance revenues Define the role of human resources Proactively assess and mitigate risk, including patient safety
Leadership
Focus on function over structure Develop a learning organization Exploit learning to reduce bureaucracy Articulate a human resources plan to remain competitive
Strategic Planning
Input of key constituents A link between tactics and strategy to organizational goals Processes to evaluate effectiveness of strategy Prioritization for deployment of scarce resources
Develop external partners Use market analysis and private-sector benchmarks Deploy and constantly review strategy Emphasize human resources planning
Focus on Patients, Other Customers, and Markets
Segmentation strategies to focus customer relations Analysis of progress for different segments Use of complaints and confederates to improve systems Employee empowerment as a strategy to meet consumer needs Proactive interaction with customers
Information and Analysis
Ability to deploy relevant, timely information Relevant information accessible by all personnel Real-time analysis and feedback of current performance
Use information systems to go beyond data exchange toward knowledge exchange Rely on use of competitor data Integrate clinical and financial data Develop strategies from analysis
Staff Focus
Clear descriptions of work systems Alignment of work systems with key business drivers Recognition of individual and team achievement Linkage of educational efforts to key drivers Formal processes to evaluate staff satisfaction
Link work redesign to key drivers Begin succession planning Have methods to validate educational investment Incorporate market analysis into human resources strategy
Process Management
A systematic approach to the design of health care services and processes A focus on processes related to key drivers A systematic assessment of process change effects Analysis of effects against projections Use of key customer requirements to drive change
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Management by fact Elimination of functional redundancy Clear communication to stakeholders A systematic approach to improvement of the leadership system
Understand the potential market Anticipate the future market Focus on delighting customers Demonstrate the use of analytic tools on nonpatient customers
Use external benchmarking Anticipate effects of change Move beyond reliance on statutes Demonstrate innovation
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THE JOINT COMMISSION applicants could show how the organization prioritizes deployment of scarce resources. One applicant used a matrix to systematically analyze and prioritize interventions in patient safety and customer grievance efforts. In the future, applicants might consider including documentation of their work to develop external partners and demonstrate the use of market analysis and private-sector benchmarks. Leading applicants in the future are likely to be able to demonstrate evidence of deployment and constant review of the strategy. Finally, they will likely incorporate and emphasize the human resources plan into the strategic planning and deployment processes. Focus on Patients, Other Customers, and Markets The best applicants used customer segmentation strategies to guide their customer relations activities and to analyze progress in customer focus for the different segments. The best applicants aligned segmentation by arena of conflict and by age and other demographic factors to drive marketing strategies, prioritize resource allocation, and formulate strategic plans. They also used patient complaint analysis and confederates to identify areas for improvement in the system.* The best applicants embraced employee empowerment as a strategy to meet customer needs and to resolve complaints quickly. One applicant used information technology to systematically ensure that the voice of the customer was heard: By feeding subjective and objective data to front-line providers and empowering those providers to act on that information, customer needs were rapidly identified and met, and customer complaints were rapidly addressed. The best applicants proactively interacted with their patients and other customers to enlist their help in the system’s improvement. Successful applicants integrated patients and customers into advisory councils, improvement committees, and the process of implementing the strategic plan. Future applicants are likely to benefit from efforts to understand the potential market: those who are eligible for services but who are not accessing the system. As they do this, they are likely to want to * In one VISN, staff posed as patients to test how long it would take to get through to a provider on the phone and when an appointment would be scheduled.
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anticipate the future market and develop health care services, products, and processes that will meet future patients’ needs. They may wish to design ways to go beyond meeting minimum standards and focus on delighting customers. Finally, future applicants are likely to benefit from demonstrating how the patient/customer-knowledge building methods can apply to nonpatient customers. Information and Analysis The best applicants were able to demonstrate the ability to deploy relevant, timely information that was useful to patient care and allowed the practice of management by fact. This information was relevant to and accessible by both front-line personnel and senior leadership. One applicant developed a software system that profiles provider performance throughout the network. Linked to a key business driver, these data are accessible to the providers, allow for internal and external comparisons, and drive an organization’s decision making. The best applicants showed how they identified and met user needs; these applicants were able to provide real-time analysis and feedback of current performance. For instance, the best applicants used immediate analysis and feedback of patient satisfaction surveys to assess areas for improvement and to progress toward goal achievement. In the future, applicants are likely to demonstrate how information systems allow the VISN to go beyond the exchange of data toward the exchange of information and knowledge. There is likely to be a heavier reliance on analysis of other providers’ comparable data, including data and benchmark information from potential competitors. Successful applicants will likely demonstrate the ability to integrate clinical and financial data and the ability to provide that data to leaders for even more extensive management by fact and the resulting development of analysis-driven strategies. Staff Focus The best applicants were able to clearly describe work systems and demonstrate these systems’ alignment with the strategic drivers of daily and strategic operations. One applicant aligned all work systems and budgets around network-defined care lines to achieve a single standard of care across the network. The best applicants recognized individual and team achieve-
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ment in monetary and nonmonetary ways. Several applicants developed monetary reward systems that recognized exceptional team and individual performance; others identified exceptional teams and individuals for public recognition. The best applicants were able to demonstrate a link between educational efforts and key business drivers—educational opportunities were prioritized and focused and perhaps did not offer an exhaustive menu of options. One applicant described a systematic education plan that linked employee education and training to network business strategies and was able to identify significant changes in the overall culture through this process. Finally, the best applicants described a formal process of evaluation of staff satisfaction, some through 360-degree evaluation, and some through surveys. In the future, successful applicants will likely be able to even more tightly link work redesign to key business drivers. They will, in all likelihood, develop succession plans and will likely be engaged in proactive grooming of the future leaders of their organizations. Applicants are likely to be able to more convincingly demonstrate the methods that they used to validate their educational investments. Finally, successful applicants are likely to develop clearly articulated human resources plans, incorporating information analysis, market surveys, and strategic planning. Process Management The best applicants demonstrated a systematic approach to the design of health care services and processes; they focused their applications on services and processes that were related to drivers of daily and strategic work. For instance, one applicant realigned resources and management into network service lines to systematize the delivery of care; several other applicants were in the process of implementing a similar realignment. The best applicants also showed that they systematically assessed the effects of process change, using key customer requirements and evaluating the effects against projections. One applicant described a multistep process improvement system that was designed to anticipate all the implications of process changes, to review the changes’ impact before implementation, and to evaluate the changes’ impact on key constituents. In the future, successful applicants will likely be able to describe their use of benchmarking to health
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care and non-health care service providers. By linking strategic planning to information analysis, they will be able to demonstrate an ability to anticipate the effects of change. They are likely to be able to demonstrate what it means to move beyond a reliance on statutes and regulations, toward innovative strategies to delight those who depend on them in the community and marketplace.
Lessons for Health Care Organizations An aggregate analysis of the applications suggested lessons learned in other industries from which health care organizations could benefit. We have identified three lessons that may help health care organizations improve care and achieve stability in the processes of health care delivery. Process Literacy Process literacy involves the capacity to understand the causal systems in work that are related to desired outcomes. Improved clinical outcomes and results that are capable of being sustained require identification and work on the causal processes and systems that produce those results. This literacy can be demonstrated by using specific, illustrative examples in articulation of the health care delivery process and by measuring deployment of care processes all the way to care of the individual patient. When that connection is explicit and when the connection leads to demonstrated work to stabilize, improve, and plan those core processes, the likelihood of sustainable, predictable improvement is increased. Process Control and Demonstration of Improvement Arbitrary periods of analysis that produce irregular, infrequent snapshots of an organization diminish insight into the variation, stability, and predictability of the performance of the daily core work processes. Infrequent measurement makes it difficult to discern real trends from chimeric ones and harder to determine which changes caused improvements. More frequent recording of data can enable health care systems to be more confident about trends, to more readily establish system stability, and to more accurately predict and mitigate risk. Superb organizations use embedded, frequent measurement over time to stabilize processes and hold them in
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THE JOINT COMMISSION control. Further, these organizations design local work systems to allow local, immediate corrections to unintended and undesired variation, facilitated by capable, trained work teams. These efforts not only improve the system’s predictability and empower workers but also minimize the inefficient use of senior leadership time spent responding to exceptions. Manufacturing the use of statistical control charts is one piece of evidence of such capability which is transferable to health care. Linking of Vision to Improvement Connecting the needs of the population served with the work of every person in a complex organization necessitates both words and deeds. An organization’s vision must have meaning at the action level for every employee. To achieve this meaning, health care organizations must articulate a future and use human resources planning and management to invest in and create that future. This process will prepare organizations for the future, invite employee loyalty and satisfaction, and harness human resources in the service of improvement. Choosing interindustry world-class performance for the core process in question would help health care applicants move beyond satisfaction with average or best-in-industry standards, and toward world-class performance. The process of interindustry benchmarking stimulates innovation within the industry and accelerates tension for change. Coincident, visible investment in nested improvement strategies— each of which is linked to desired outcomes—efficiently uses human resources to achieve process stability is based on a firm understanding of the process of care, links employees’ actions to the broader strategy, gives employees ownership of the vision, and accelerates progress toward the articulated vision.
Program Evaluation After the Quality Achievement Recognition Grant awards were distributed, the program was evaluated through the use of conference calls with the organizations that had site visits. All four organizations that had site visits reported that participation in the grant application process was generally useful and that in particular it helped them to achieve a more comprehensive perspective on the processes of health care delivery; and
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more clearly articulate processes, improvement efforts, and strategies to internal and external stakeholders. These organizations also suggested ways to improve the application process. First, they suggested that, although site visits were an opportunity to access expertise, the time restrictions on the survey restricted that access. Second, organizations reported that immediate feedback by the evaluation teams would add value to the process. Although each applicant received an extensive written feedback report, applicants expressed a desire to “pick the brains” of the reviewers during the site visit, particularly those from outside the VHA system. Third, they noted some inconsistencies in how the site visitors approached their jobs across VISNs. Finally, while the Baldrige framework offers an objective way to evaluate management practices, applicants described a need to more easily articulate the complexity of the Baldrige structure for all members of the organization. We believe that complexity can be addressed and that applications can be streamlined if the organization can ask and answer the following six questions: What do we make? Who do we make it for? What do our customers want? What are our processes to meet those wants? What is the end-process metric? How do we improve what we make? The Quality Achievement Recognition Grant is now being used a second year; applications were due November 15, 1999. The application process and the monetary awards are the same. The grant criteria now being used are the Baldrige Health Care Criteria, without modification, resulting in less emphasis on performance results and more emphasis on the management of processes. Of the seven VISNs that completed applications in 1998, four completed applications this year. One of the seven will be using the feedback from last year’s application to make improvements this year; that organization plans to submit an application next year. Representatives from nine VISNs attended training on the award process, seven VISNs completed applications, and three VISNs received site visits. Presentations and final judging occurred in March 2000. Awards will be announced in July 2000.
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Discussion In this article, we describe the application and review process for the VHA Quality Achievement Recognition Grant, a competitive grant application open to all VISNs within the VHA system and based on the Baldrige management framework. We have compared the scoring system used in the first year of the VHA program to that used in a traditional Baldrige health care application. Finally, we have reviewed the seven completed applications from 1998, identified best practices from within that cohort, suggested areas for future applicants to develop and emphasize, and articulated lessons that may help organizations improve health care delivery processes. The use of the Baldrige framework allowed top VHA leadership to identify areas for future development and local leaders to examine the way they work against a generally accepted assessment framework for complex organizations. This is consistent with the reports of other health care organizations that have indicated that the internal and external reviews of current organizational processes were the largest benefits derived from the application process.6–8 We have also found that the benefits of the application process go beyond the meeting of standards, toward integrated organizational learning.9 Our analysis has several limitations. First, the application process was inherently biased. The process was voluntary and demanding of applicants; the knowledge of performance results of all potential applicants may have influenced organizations’ decisions to apply. We have not captured best practices that reside in nonapplicant organizations. Our hope is to stimulate more future applicants through reporting these results. Second, our review method was limited to the written applications and reviews generated by the award team. Although there was a common process of review, there were undoubtedly inconsistencies across award teams—some of which were noted by the applicants—which may have biased our perspective. Our authorship includes significant
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expertise with the Baldrige award process, which may mitigate this bias. Finally, extrapolation of the results from the VHA experience to the larger health care services industry may be limited by the VHA’s specific organizational structure, service population, compensation schemes, and funding structure. However, to the extent that health care organizations share the mission of the VHA to improve the health of the population served and share general professional development processes and general processes of patient care, generalizations may be valid. Despite these limitations, we have demonstrated the utility of a common framework in the analysis of health care delivery systems and the advantages of using a framework employed in other industries interested in improving the quality of core processes and outcomes. The Quality Achievement Recognition Grant process appeared to be a valuable exercise for those who applied and for the VHA system. The systematic review of best practices should help the VHA become a learning organization through the sharing of best practices across VISNs. Finally, the identification of areas of improvement and lessons from other industries should help the broader organization focus on impediments to success throughout the system. J References 1. Kizer K: Prescription for Change. Washington, DC: Department of Veterans Affairs, 1996. 2. Kizer K: Quality Achievement Recognition Grant. Washington, DC: Department of Veterans Affairs, 1998. 3. Department of Veteran Affairs: Quality Achievement Recognition Grant, 1998 Application. Washington, DC, 1998. 4. Fisher D, Simmons B: The Baldrige Workbook for Healthcare. New York: Productivity, Inc, 1996. 5. Ryan M, Thompson W: CQI and the Renovation of an American Health Care System: A Culture Under Construction.
Milwaukee, WI: ASQ Quality Press, 1997. 6. Jensen L: Improving healthcare quality: Application of the Baldrige process. J Nurs Adm 26(7/8): 51–54, 1996. 7. Gaucher E, Kratochwill E: The Malcolm Baldrige National quality Award: Implications and uses for healthcare organizations. Infect Control Hosp Epidemiol 16:302–307, 1995. 8. Grooper E: The Malcolm Baldrige Health Care Pilot. Nurs Manage 27(4):56–58, 1996. 9. Moore J: SSM gears up for Baldrige Award. Modern Healthcare, Mar 15, 1999, p 58.
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