Performance Management and Measurement

Topics: Systems thinking, Measurement, Hospital Pages: 9 (2833 words) Published: January 24, 2006

Performance measurement is essential within organizations today, and is integrated with prioritizing work. It identifies and measures those activities that are important to serving both internal and external customers. Measures help management manage by fact. Knowing when to perform the performance measurements and when and what performance development measurements data to routinely capture for predictive maintenance is a must in order to be effective and eliminate preventative failures. The purpose of this paper is to compare and contrast two case studies based on the required simulations, Applying Systems Thinking in Managerial Decision Making and Using Performance Metrics. Based on the data within these case studies, we will explain the indicators of organizational performance. We will propose and assess metrics for measuring the organizational performance and establish standards for measuring the organization¡¦s success. Also, we will apply systems thinking to evaluate the impact on the selected performance measurements. Finally, though analysis, we will illustrate the impact of performance enhancement in one part of the organization on other parts. Organizational Performance Analysis

Performance Indicators
Once an organization has analyzed its mission, identified all its stakeholders, and defined its goals, it needs a way to measure progress toward those goals. Performance indicators are those measurements. Whatever performance indicators are selected, they must reflect the organization¡¦s goals, they must be the key to its success, and they must be quantifiable. The following will identify the performance indicators for both case studies: Case 1 - Applying Systems Thinking in Managerial Decision Making The issue for Thistle Woods Hospital was spacing in the emergency department. There were not enough beds to accommodate patients being admitted, and the task was to identify the problem area causing the spacing issue. In reviewing the performance of the functions within the hospital, we needed to determine what measures were useful. The indicators were as follows: process flowchart, systems chart, emergency traffic, inpatient traffic, and laboratory traffic. After much data analysis, we came to the conclusion that the problem area was the laboratory process. We found from the indicators that the laboratory traffic was delayed, and patients were not serviced on time. This delay caused a ripple effect on the emergency department resulting in overcrowding and spacing issues. This spacing problem was found to be outside of the emergency department. In order to rectify this issue, we needed to review the objectives of the organization to determine the measurements needed. ¡§By examining individual measures, indices give you ¡¥drill down¡¦ capabilities to pinpoint problem areas¡¨ (Rummler, Brache, Chang, & Morgan, 2003). After review of Thistle Wood¡¦ motto, ¡§Honor, Service, and Commitment,¡¨ we decided to look more into the laboratory processes. As a result we recommended that priority services needed to be arranged within the laboratory for emergency patients. We felt that this would help with limiting the overcrowding in the emergency department. One of Thistle Wood¡¦s goals was ¡§Service,¡¨ so it would necessarily have performance indicators that measure the services within the emergency department and related fiscal measures. Case 2 - Using Performance Metrics

Measurement involves using the right measures at the right time, especially in measuring organizational performance. If a performance indicator is going to be of any value, there must be a way to accurately define and measure it. For example, ¡§Generate More Repeat Customers¡¨ is useless as a performance indicator without some way to distinguish between new and repeat customers. This simulation audits the process of performances for Santagreen University. Performance indicators are measurements that define where an organization is and helps to...
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