Quality management and business performance in hospitals: A search for success parameters

This paper is based on the results of a European study aimed at identifying and exploring success parameters of high (quality) performance and their possible interrelationships. The study was conducted in three service sectors (the hospital, road freight transport and banking sectors) in three European countries (Spain, UK and the Netherlands) early in 1995. In this paper we shall concentrate on the hospital sector. Based on the hospital data, we examined if criteria other than those used in the European Quality Assurance (EQA) model are more accurate in identifying quality progress and business performance of hospitals. Our research shows that different explanatory variables are linked to progress in total quality management (TQM) and business performance. Moreover, the sector involved in the study plays an important role. Our first conclusion suggests that the general application of the EQA model as an evaluation instrument is subject to debate. A second conclusion is that there is a positive link between progress in TQM and perceived service quality by customers. TQM improves perceived service quality. Progress in TQM and perceived service quality by customers are positively, but only to a limited degree, linked to business performance. However, this may be due to the general level of quality management in the sector studied. In general, we conclude that progress in TQM leads to higher business performance of the hospital, indicating the efficiency/cost effect, and to a higher perceived service quality by patients, indicating the effectiveness.