Applying the Balanced Scorecard in Healthcare Provider Organizations

Several innovative healthcare executives have recently introduced a new business strategy implementation tool: the Balanced Scorecard. The scorecard's measurement and management system provides the following potential benefits to healthcare organizations: It aligns the organization around a more market-oriented, customer-focused strategy It facilitates, monitors, and assesses the implementation of the strategy It provides a communication and collaboration mechanism It assigns accountability for performance at all levels of the organization It provides continual feedback on the strategy and promotes adjustments to marketplace and regulatory changes. We surveyed executives in nine provider organizations that were implementing the Balanced Scorecard. We asked about the following issues relating to its implementation and effect: 1. The role of the Balanced Scorecard in relation to a well-defined vision, mission, and strategy 2. The motivation for adopting the Balanced Scorecard 3. The difference between the Balanced Scorecard and other measurement systems 4. The process followed to develop and implement the Balanced Scorecard 5. The challenges and barriers during the development and implementation process 6. The benefits gained by the organization from adoption and use. The executives reported that the Balanced Scorecard strategy implementation and performance management tool could be successfully applied in the healthcare sector, enabling organizations to improve their competitive market positioning, financial results, and customer satisfaction. This article concludes with guidelines for other healthcare provider organizations to capture the benefits of the Balanced Scorecard performance management system.