Management by Measurement
‘What gets measured gets done’ is a popular saying in the world of incentive compensation design. It also, to some extent, provides context for the organizational challenges surfacing at service providers contracted by the Local Health Integration Networks (LHIN) through the Ministry-LHIN Accountability Agreements.
While there may be additional contract dimensions which vary across the 14 Ontario LHINs the Ministry/LHIN/service provider reporting relationship is predominately focused on managing and measuring against service delivery parameters more so than those related to operational effectiveness. The former consideration cannot and should not be exclusive of the latter. However, this seems to be the policy and accountability framework norm.
I am not aware of any substantive body of research that suggests high service delivery levels can be attained without a proportionate focus on operational effectiveness. The recent patient and employee information breach at CarePartners as well as the third-party findings of poor governance and workplace effectiveness noted at the Elgin branch of the Canadian Mental Health Association attest to these operational challenges which may directly impact service delivery – and in the case of legal involvement, chews into funds that might otherwise go into service delivery efficiencies. So what level of oversight/attention do Funders pay to this part of the service provider relationship equation?
Self-Assessment vs Evidence Based Decision-Making
The Central LHIN, for example, uses a Self-Assessment tool which touches on categories like Agency Governance and Executive and Strategic Leadership – both of which include a few human resources (HR) management questions. This anecdotal Funder focus on HR practices, however, should be concerning –highlighted by the Elgin scenario – for two key reasons. First, staffing and benefit budgets typically represent one of the largest fixed costs and can reflect up to 80% of total funding and expenditures –so fiscal management should be of paramount interest to the Board and ED. Secondly, leadership effectiveness is an established barometer of workplace morale and productivity –which brings us back to our central theme: you can’t have an isolated focus on service delivery improvements without proportionate consideration of operational effectiveness.
Since the LHIN’s service providers rely primarily on employees, not machines to deliver services, it is in the best interest of the Funder, as stewards of rate payer funds, to at least have a reporting awareness of the service provider’s HR management policies and practices including those related to compliance and leadership risk exposures that might impede service delivery.
Perhaps the Premier’s business management focus on all aspects of the Ministry/LHIN/service provider relationship is timely. In much the same way as it might sound trite and insulting to cut all discretionary spending on “free” coffee/tea at the LHIN offices, it’s equally annoying as a rate payer to accept that the administration of health care service delivery will generally default to increase funding as the most feasible solution.
Innovation Without Ratepayer Financing
The health care voice in Premier Ford’s government, Dr. Rueben Devlin, has called on the need for more innovation in the system to extract greater efficiencies. Innovation, however, does not always mean a new widget or process; it could also mean re-orienting oneself to the challenge at hand and identifying innovative solutions without additional expenditures.
There is another popular saying that fits with the task at hand: ‘change the way you look at things, and the way you look at things will change’. Within this context, it would be interesting to conduct a random external audit of HR effectiveness barometers (as defined by the Profession) across a sample of service providers within any given LHIN that rated high on their Funder self-assessment scores. The resultant Funder report could supplement Board reporting materials and paint a clearer picture of both financial and human capital performance and associated risks at the point of our healthcare service delivery.
What’s the likelihood of a Board accepting financial reporting based on self-assessment? Are there any inherent governance flaws in that logic?
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