Scorecard: Linking Strategy to Performance Objectives
By Laura L. Ponticello
A successful company and its leadership must have the ability to meet financial and customer expectations in a changing global economy. To win customer confidence and meet business plan objectives, the leadership team must not only develop a winning strategy, but drive results by turning the strategy into a reality through communication and a fact-based performance measurement system. Easily said, but turning the business strategy is into actionable items is a difficult undertaking.
Business leaders should be able with confidence to answer the question:
Does every employee in the organization understand the business strategy and how he/she can contribute to the success of the strategy?
By utilizing a performance measurement system, such as a balanced scorecard, an organization commits to assessing performance, monitoring performance, course-correcting performance and aligning all employees with key objectives. Therefore, whether an accountable leader or a staff member who performs the work, employees all have a method to assess progress, ascertain the improvement and make changes if required.
In addition, leaders and staff can be assured of being headed in the same direction when the organization's strategy is aligned with:
- Key projects or program areas that link to personal and team accountability.
- Business process with key program areas that link to personal and team accountability.
- Business plan objectives with key indicators that link to personal and team accountability.
Key Components of a Balanced Scorecard Approach
An operations plan design should outline the key strategy, priorities, areas of responsibility and critical performance measurements through responsible leadership and team performance toward measurable areas. Critical plan components include strategy, deliverables, performance indicators and organization. Key plan components include:
- Operating plan strategy: Understand why the targets will be met.
- Deliverables: Know the performance measurement targets.
- Performance indicators/measurements: Show how to meet targets.
- Organization: Understand who is accountable for targets.
Here is a look at the balanced scorecard approach from an integrated view:
| | Strategy
Defines the mission, the customer segment and purpose |
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Organization Alignment
Defines accountablility and key focus areas to achieve company's business plan | Business Objectives
States goals, commitment to stakeholders | Communications
States out loud the mission and how employees can contribute to company success |
| | Performance Metrics
Tools to measure performance against objectives | |
Key operating scorecard dashboard measurements as a minimum should include:
- Customer satisfaction: Measure customer retention and customer attrition by product and region. (Customer satisfaction survey may be a good tool.)
- Cost of access: Measure network optimization targets.
- Network reliability: Measure trouble tickets.
- Revenue plan execution: Measure sales order backlog, customer churn, install revenue.
- Internal systems/information management: Measure system availability and system implementation or system consolidation if applicable.
- Customer delivery process: Measure provisioning times.
Performance metrics may vary by company. However, critical focus on key concentration areas and requirements for success will enable achievement of business objectives. Competitive edge initiatives to be included in implementing a balanced scorecard approach are:
- Standard product set with clear definition by product and a standard product set that can be sold, implemented for customers and billed effectively.
- Service delivery process that gives attention to automate key activities and efficiency to reduce manual handoffs.
- Information management and systems that are aligned with business process and drive system automation. Dependent on company, convergence into common platforms may be required to achieve system automation.
- Billing processes should guarantee accuracy to minimize customer disputes and ensure cash collections.
Implementing a balanced scorecard requires obtaining consensus on deliverables, strategy, performance indicators and organization design that aligns with business process. The output of a balanced scorecard approach will yield an operating plan that will enable leaders to have clear levels of responsibility for delivering products and services. Performance metrics should ensure alignment with corporate financial performance targets and link to employee performance.
Metrics should be impartial, ensure trustworthiness of quantifiable results and match concentration areas of the business. As the business grows, integrates, changes in strategic direction, the balanced scorecard metrics should course-correct to align with the changes. Metrics have to be viewed as reliable sources of data.
Balanced Scorecard Checklist for Leaders
Business leaders should develop performance measures using this checklist.
- Line up the strategy with critical projects or program areas.
- Line up the business process with strategies and business plan objectives.
- Line up mission and department objectives with individual and team accountability.
- Reduce the number of key metrics to ensure that the corresponding reliable pieces of data are greater than multiple metrics that are unreliable pieces of data.
- Involve group members with responsibility in the deployment of scorecard metrics.
- Make sure team metrics cut across organizations to ensure cross-functional goals.
Balanced Scorecard Dashboard as a Management Tool
Team leaders can appreciate the benefits of implementing a balanced scorecard when the scorecard becomes a management tool. The team leader can review progress against key target areas on a weekly, monthly and quarterly basis. Reporting of metrics should follow with a schedule of when the data will be available for viewing. For example, a consolidated list of outstanding accounts payable may only be available monthly and, therefore, the scorecard metric should report monthly given data availability.
The balanced scorecard measurement system can show progress month over month and display areas that need improvement, as well as, become a tool to indicate progress over time. Typically, color coding is use on the scorecard. For example, red can indicate that a key metric or program area of focus is underperforming and not meeting expectations. Green could indicate meets or exceeds expectations for the reporting metric. Yellow could be used to indicate near to meeting expectations but requires attention.
During an operations review or staff meeting, the business leader can review each critical area on the dashboard and use the management tool as a discussion point for progress and performance. In addition, the focus of the operational review leans toward underperforming areas and plans to correct the area with clear accountability. Then progress can be tracked for improvement. The scorecard becomes the communication vehicle to discuss performance.
Conclusion: Road to Predictable Success
Leadership demands action – given that a leader is in charge of meeting deliverables and a leader's performance is based on his or her ability to execute. Performance management tools, such as the balanced scorecard, provide information vehicles for performance, and sanction employee behavior to focus in areas of improvement and goal achievement. When a leader understands the strategy and turns the strategy into a reality through linking mission to business plan objectives via communication, performance metrics and organizational alignment, then he or she is on the road to achieve predictable success.
Most importantly, a leader can mobilize or motivate team behavior toward achieve goals through using a balanced scorecard measurement system. Action is driven through a balanced scorecard approach using fact-based performance management tools.
About the Author: Laura L. Ponticello, leadership advisor/president for 4 C Company, provides senior level executives solutions in areas of strategy planning, leadership development, executive coaching, human resource outsourcing, facilitation and training, and employee communications. Her career in leadership spans more than 13 years in high tech industry and telecommunications. Ms. Ponticello previously served as vice president of strategy planning for Global Crossing. She also worked for a consulting firm with clients such as GE, Electronic Data Systems and IBM. She has a degree in anthropology and sociology from Canisius College, Buffalo, New York (USA). She can be reached at lrlp001@aol.com.
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Bringing the Balanced Scorecard Back to Life
By Henry Killackey
Over the past few years, some industry analysts and organizational executives have questioned the effectiveness of the balanced scorecard. The tool, introduced by Robert Kaplan and David Norton in 1992 in an article in the Harvard Business Review, is used to articulate to individual employees the organizational goals and objectives set by management. Some modern critics of the balanced scorecard have gone as far as to proclaim that it no longer possesses the potency to fill this communication function. Others have argued that the effectiveness of the scorecard has been overhyped by software solution providers and consultants who have promised quick fixes to problems associated with strategy execution.
After reviewing these arguments and accusations, a logical question arises: Is the balanced scorecard dead?
Elements of Scorecard Survival
By asking if the balanced scorecard is dead, an individual is really asking whether or not it has completely lost its effectiveness in driving organizational transformation and strategy execution. For this specific question, the answer is not simple. To derive an answer, a different question has to be asked: Can the balanced scorecard die? The answer to this question is yes.
Any successful scorecard implementation has two requisites: a commitment from leadership and organizational buy-in. The leadership has to believe the balanced scorecard will communicate strategy and the organization has to feel that it will bring positive results. When leadership is lukewarm on the scorecard or if there are significant personnel changes in the executive ranks, there can be a serious lack of continuity, which can disrupt and even end an implementation. Also, if an effective business case is not made to the organization for the adoption of the balanced scorecard, individuals may perceive it as a system that will create bureaucracy and enhance the difficulty of their daily jobs. Behind every effective implementation, there is a commitment from leadership and there is buy-in from organizational business units and individuals. Without these key elements, the balanced scorecard dies.
Scorecards and Dashboards: Know the Difference
While critics of the balanced scorecard have been quick to accuse software solution providers and consultants of falsely describing its benefits, they have neglected to acknowledge the confusion that exists in the marketplace between scorecards and dashboards. As organizations have sought to automate their performance measurements, the terms scorecard and dashboard have been confused with one another and used interchangeably. This confusion has damaged the perception of the balanced scorecard. Some companies have implemented dashboards with the expectation that they would yield the same results as the balanced scorecard.
But according to performance management expert Gary Cokins, there is a clear distinction between dashboards and scorecards: Scorecards display organizational performance as it relates to strategic objectives and plans (key performance indicators are typically derived from a strategy map and have a relation to one another), while dashboards are focused on measuring the performance of business processes through measurements that do not have a clear link to strategy. By understanding this distinction, organizational executives and managers can set reasonable expectations for their scorecards or dashboards.
Signs of Life
So if it is possible for the balanced scorecard to die in an organization, what signs show that it lives? A living scorecard fulfills numerous roles, including:
- Communication system and framework – The balanced scorecard communicates organizational progress and results through leading and lagging indicators segmented into four perspectives: financial, customer, internal process and learning/growth. Employees can gain an understanding of how their efforts contribute to organizational progress and success as communicated through these performance measures.
- A process that drives change – Using the balanced scorecard, executives and managers are able to break organizational strategy down to understandable terms and manage change by implementing initiatives derived from a strategy map.
- A measurement system – The scorecard reports on past operating performance and the drivers of future performance.
Set Reasonable Expectations
Ensuring the effectiveness of the balanced scorecard is about creating performance measurements, as well as linking the organization to strategy. Skepticism has developed over the scorecard because unreasonable expectations have been tied to it. On the journey to strategy execution and performance improvement, there are no easy or quick solutions. By gaining the commitment of leadership, the support of employees and putting forth the effort to translate strategy, the balanced scorecard can live in an organization and generate results.
About the Author: Henry Killackey, a Green Belt, is the managing partner and founder of the Global Institute for Management (GIM), an educational services provider. He can be reached at henry.killackey@gimanagement.com.
Merging Six Sigma And The Balanced Scorecard
By Bradley Schultz
In an era of complexity and contradiction, many healthcare organizations are seeking bold strategies for leading and managing change. While concepts behind the Balanced Scorecard and core Six Sigma methodologies are not new, a powerful management tool can be crafted through the unification of these two proven strategies.
An approach that combines the targeted performance indicators of a Balanced Scorecard with the statistical rigor of Six Sigma can be used to effectively focus an organization on the achievement of strategic goals – in essence, creating the ultimate "management cockpit." Adopting this structured approach to planning, managing and monitoring improvement brings cohesion to conflicting constituencies and builds confidence in proposed process improvements. In turn, this confidence can have a measurable impact on the organization by accelerating the implementation of change, often viewed as a delicate balance between cost, quality and efficiency.
The Case for Change
Healthcare today is experiencing both the best and worst of times. Countless lives are saved daily by medical breakthroughs, dedicated practitioners and state-of-the-art technologies. Yet, within this trillion-dollar industry amazing medical feats are juxtaposed against systemic failures and disgruntled stakeholders. Workforce shortages further constrain a system facing a rising demand for services. Advanced technology is often overlaid on archaic processes. As some emergency departments are forced to close, others find themselves overcrowded and understaffed.
Especially frustrating are reimbursement challenges that continue unabated. These challenges are now accompanied by significant changes in the payer mix, moving steadily away from government toward private or industry payers, as illustrated in Figure 1. History indicates that the combination of this shift in payer mix with the rise in healthcare premiums will trigger a market reaction. Figure 2 illustrates this anticipated reaction by comparing the annual percent change in healthcare premiums to the annual percent change in the consumer price index as an indicator of general inflation.
| Figure 1: US Healthcare Coverage and Spending |
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| Figure 2: Healthcare Premiums vs. General Inflation |
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The market began its reaction, in the form of managed care, to the wide gap existing prior to 1990. This gap decreased significantly until the implementation of the Balanced Budget Act (BBA), and by 2002 it had widened again to nearly 10 percentage points with further market reaction anticipated. There are two significant risks associated with the next market reaction: 1) Government intervention, 2) Industry consequently recasting providers as mere vendors.
The industry is at a critical juncture, facing a growing need for systemic change but lacking the infrastructure and digitization that could provide a clear line of sight from strategy to execution and impact. Under mounting pressure to provide better care using fewer resources, some organizations are seeking alternative management models, realizing they can no longer conduct "business as usual."
One solution to help organizations truly align strategic objectives with a clear measurement of impact may be combining the rigor of Six Sigma with the Balanced Scorecard approach.
A Balanced Scorecard approach provides the mechanisms to drive organizational alignment, sustain improvements and maintain equilibrium across the enterprise. Based on statistics and aspects deemed most 'critical to quality,' Six Sigma could further focus the organization's improvement efforts. Such an approach that identifies and statistically quantifies the impact of causal factors on healthcare's value chain would provide organizations with a solid foundation for change.
Healthcare's Value Chain
Understanding healthcare, from a business perspective, is critical to insuring the long-term viability of a delivery system. It is also a prerequisite to applying both the Balanced Scorecard approach and Six Sigma methodology. Six Sigma originally grew from a setting that was primarily industrial and product-focused. Within this environment, operations are performed on raw materials and as a result they become more valuable component parts. These component parts are then built into higher-level assemblies and ultimately products of progressively increasing value. The value chain for healthcare differs significantly from this model and is illustrated below in Figure 3.
| Figure 3: Healthcare's Value Chain |
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The value chain for healthcare begins with highly satisfied, dedicated and well- motivated care providers. This produces high internal quality, which relates to process steps that are felt by the institution and are not directly felt by the patient or referring physician. An example of an internal quality metric is the cycle time for the transcription of a radiology report. This represents an interim step in the process that begins with the recognition of need for the exam and ends with the authenticated report in front of the clinical decision maker. Naturally then, high external quality follows from high internal quality. In other words, quality in those steps that are felt by the customer leads to high customer satisfaction and loyalty. This, in turn, leads to revenue and margin, completing the value chain.
When appropriate performance metrics are aligned along the value chain, they provide greater insight into how the system is performing today, and what it may anticipate in the future. This concept is illustrated in Figure 4. In this illustration the organization under consideration is operating well in its financial and customer satisfaction metrics as indicated by the upward pointing green arrows. Employee satisfaction and internal quality are poor as indicated by the downward pointing red arrows. As a result, external quality felt by the customer is beginning to decline as indicated by the yellow arrow pointing sideways. It is intuitive that if this trend continues, customer satisfaction and financial performance will begin to decline as well.
| Figure 4: Cause and Effect on Performance of Value Chain |
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The Balanced Scorecard approach is based upon understanding healthcare's value chain and aligning both strategy and the extended delivery teams' behavior to focus on those activities necessary for the sustained creation of value. Six Sigma methodology is based on statistically quantifying the impact of causal factors on the variability of results. When applied in concert, they represent powerful tools that can be effectively deployed to align the organization's vision, mission, strategy and specific behaviors toward the sustained creation and delivery of value.
Creating Organizational Alignment
Most healthcare delivery systems in the United States publish a vision or mission statement. Most institutions also undergo a rigorous annual planning process. Fewer organizations take one more step by translating the resultant strategic imperatives into families of clear, simple metrics aligned to the value chain. Even fewer have made these metrics appropriately visible and actionable at all levels.
Generally written at the 30,000-foot level, vision and mission statements are designed to elicit basic agreement from all team members. When vision and mission are translated into specific behaviors, however, agreement is less immediate and conflict may arise among various stakeholder groups. Translating strategic imperatives into a network of clear, simple metrics is the first step in the Balanced Scorecard approach. Alignment of these metrics along the value chain is Step 2, and is illustrated in Figure 5.
| Figure 5: Making Vision and Mission Actionable |
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The remaining steps in using the Balanced Scorecard approach to create organizational alignment include the following:
Step 3 - Assessment of the Organization's Capabilities
Step 4 - Cause Analysis
Step 5 - Resource Deployment
Step 6 - Alignment of Systems and Structures
Step 7 - Monitoring Progress and Continually Raising the Bar
Many of the statistical tools and process improvement techniques associated with Six Sigma lend themselves well to the accomplishment of these subsequent steps and are illustrated in the following sections.A Six Sigma Primer
The philosophy that underlies the Six Sigma process begins with the fundamental assumption that unless we understand a process mathematically, we know little about it. If we know little about it, we are not in a position to control it. If we are not in a position to control it, then we are at the mercy of chance variation.
In the simplest of terms, Six Sigma is a quality improvement methodology that provides a systematic approach to the elimination of defects that affect something important to the customer. Those aspects of service that are of importance to the customer are termed "Critical To Quality," or CTQs in Six Sigma jargon. The tools associated with Six Sigma are qualitative, statistical and instructional devices for "observing" process variables, "quantifying" their impact on outcomes, as well as "managing" their character. Six Sigma is based upon three simple principles:
- What is important to the customer? A customer is defined as anyone who receives a product, service or information. Therefore, when coupled with the Balanced Scorecard approach…internal quality impacts internal customers and external quality impacts external customers.
- What is an opportunity? An opportunity is represented by every chance to get something right…or get it wrong.
- What defines success? Every result of an opportunity either meets the customer's CTQs and is a success, or fails to meet the customer's CTQs and is a defect. In Six Sigma, an indicator of success or failure is referred to as defects per million opportunities
Every human activity contains variation. The term "Sigma" is a symbol for standard deviation, a measure of variation. Six Sigma refers to the idea of being able to achieve six standard deviations between the mean performance of the process and the customer-determined specification limit. If Six Sigma performance is achieved in a process, then that process will generate less that four defects (occurrences of getting it wrong) per one million opportunities.The idea of measuring the number of standard deviations that fit between the mean performance of a process and the customer's expectation (translated into specification limits) is referred to as the process "Z-Score." The Z-Score allows for comparative analysis of the performance of dissimilar processes, based upon the tendencies of each to either satisfy or disappoint their respective customers, the higher the Z-Score the less probability of customer disappointment.
Making Quality the Operating System
Each metric in the value chain is assessed based upon its ability to satisfy or disappoint its customer. Referring back to Figure 4, this is the method whereby the status of each link in the chain is evaluated. Employing this approach allows the institution to essentially make quality the operating system.
A top level institutional Scorecard must be translated to the department level. At the department level, those factors that have the greatest impact on the top level Scorecard must be identified and rigorously controlled. This is another significant opportunity to employ Six Sigma methodology. A typical Six Sigma project will focus on a specific metric referred to as the project's "response variable" or Y. The variation in this Y is a function of one or more causal factors, referred to as Xs. The idea is to mathematically understand the contribution of causal factors to variability of the project's response variable or Y, before specific solutions are designed, thereby maximizing the impact of the solution.
By creating statistical linkages between the Y, metrics on the Balanced Scorecard and the X(s), causal factors, the Six Sigma methodology augments the Balanced Scorecard approach in two important ways. First, every link in the value chain is a causal factor to the subsequent link. Referring back to Figure 4, each link may be thought of as a Y in and of itself, and as an X to the next downstream link in the chain. Second, as the value chain metrics at an institutional level are flowed-down to departments, quantification of the causal Xs at a department level will pinpoint specific processes and behaviors that have the greatest impact on the value chain. This provides the foundation for Step 4 (Cause Analysis).
In Cause Analysis, two strategies are deployed with the same objective - focusing limited resources on those activities that represent the greatest return on investment. First, by retaining performance data month to month along the value chain, a regression model may be built indicating the potential impact of changes in one link of the value chain on performance in successive links. This model also can highlight where there is no verifiable statistical linkage, leading to three critical outcomes:
1. Insuring the right metrics have been selected.
2. Insuring these metrics are measured properly.
3. Focusing senior level management on one overall deployment strategy
During the analysis phase, the team identifies the factors or Xs likely to have the greatest impact on the response variable. These factors are classified as either controllable or uncontrollable. If a causal factor (X) is controllable and contributes significantly to variability in the response variable (Y), then an opportunity to achieve a better result presents itself by controlling the causal factor. By focusing on causal factors that have a statistically proven impact on a process, the organization gains an important advantage in being able to predict the effect of proposed changes and create an easily understood family of value propositions.Aligning Systems and Structures
So far, we have translated the organization's strategy to the value chain, assessed the organization's capabilities and discovered which projects will have the greatest impact. In the analysis phase, we explored the underlying factors that actually drive results. Each phase is integral to the overall process and ensures that the team is using the right techniques to focus on the right objectives for the right reasons.
Taking an improvement initiative to the next level, however, also requires a careful examination of existing systems and structures. In many cases, the way an organization's systems and structures are aligned fundamentally conflicts with the objectives they are trying to achieve. It's important to begin by making sure appropriate resources are deployed where they will have the greatest impact. It is also necessary to look at seven additional elements that are key to the success of the initiative, and critical questions that must be answered:
Organizational design: Is your quality program contained within a single department or is the concept of quality spread across every part of the business?
Staffing: Are you selecting the "best and brightest" from your staff to lead quality and process improvement efforts?
Development: Have you provided options for continuing education, experiential or project-based training and cross-functional capabilities?
Measurement: Are your projects supported by the right metrics and aligned with your strategic objectives? Are your performance measurements designed to drive organizational success?
Rewards/recognition: Is there a consistent process in place for rewards and recognition linked to key metrics?
Communication: Does the organization understand the importance of clear and consistent communication?
Information Technology: Are there sufficient IT solutions in place for project funnel management, financial linkage and program monitoring?
Gaining Control
The last and continuing step in this process involves monitoring changes and key metrics. That's the purpose of the Balanced Scorecard itself - to serve as a tool that assures the achievement of the organization's strategy on an ongoing basis. The Balanced Scorecard should have a top level appearance similar to the illustration in Figures 3 and 4, along with the ability to drill down in each one of the five top level sections and review the metrics associated with those activities that create the greatest organizational leverage.
The challenges confronting healthcare are complex, and no overnight solution will make the problems disappear. Taking a calibrated approach to performance improvement, however, can help hospitals and health systems regain control and realize substantial benefits. Combining Six Sigma with the Balanced Scorecard may be the best way to reach and sustain a new level of organizational excellence.
About The Author
Bradley J. Schultz has more than 10 years experience in process design and improvement, organizational development and change management. He also is a Six Sigma Master Black Belt with more than 18 years experience at General Electric. He is currently a senior consultant within the Performance Solutions group at GE Medical Systems. His educational background is in business and engineering with a BS in business quantitative/finance and an MBA from Marquette University. He is an experienced speaker and author on subjects including Six Sigma and change management. He can be reached at Bradley.Schultz@med.ge.com.
Communication Strategies for Six Sigma Initiatives
By Carolyn Pexton
Making the decision to bring Six Sigma into your organization is just the first step on a long journey. Although this approach has proven successful for a variety of industries (including healthcare), the best-laid plans may go awry if the focus is solely on the technical side, without considering the cultural and communication aspects of the equation.
Since implementing Six Sigma usually involves changing human behavior, it's critical to include a carefully constructed communication plan that identifies and addresses human concerns. Initiating transformation of any magnitude across a healthcare organization requires meaningful dialogue with physicians, nurses, managers and other key stakeholders. The leadership team must communicate early and often -- clearly conveying the vision, strategies and benefits for all concerned. Overlooking this piece of the puzzle may undermine your efforts and could leave employees to fill the gaps with rumor, speculation and cynicism.
Depending on the existing culture and level of familiarity, the news that Six Sigma is being adopted in the organization may elicit a variety of responses-everything from fear of the unknown to enthusiastic endorsement. For some, Six Sigma may represent an unwelcome change in familiar routines…"We've been doing things the same way for years-why do we have to switch now?" For others it may signify opportunity…"How soon can I sign up for training and start my projects?" Naturally, there is a wide range of reactions between these two, and if you're championing the cause you'll obviously hope to hear comments that lean toward the latter example.
Launching Six Sigma in Healthcare
A thoughtfully designed communication plan can increase the chances of a smooth launch and help to lift all boats-while skipping this step can sink a large ship before it ever leaves the dock. It's important to anticipate and respond to some of the most frequently asked questions from employees regarding Six Sigma implementation:
What Is It?- What is Six Sigma all about?
- Isn't this a manufacturing initiative? How does it relate to healthcare?
- We've been through TQM, CQI, PDCA and other programs. Is this just another "flavor of the month"?
- Some of the terminology seems strange. What is the difference between a green belt, black belt and master black belt?
What's In It For Me?- How will this initiative affect me?
- How will it impact my department?
- Is this a potential threat or eventual benefit relative to job security?
- Will there be a role to play even if we're not statisticians?
- We're already stretched thin - where will we find the time for this?
- Are there career advantages to participating in Six Sigma?
What Does This Mean For Our Hospital?- How will this benefit our patients?
- How will physicians respond to Six Sigma? What role will they play?
- What are the initial areas targeted for improvement and how soon will we see results?
- What criteria will be used for selecting Black Belts and projects?
The answers to such questions will obviously depend on the specific goals and objectives your organization has established, the variety of people you will be communicating with and the amount of information each stakeholder group needs to receive during the early phases of the initiative.
Designing an effective communication plan will require answering the basic questions - Who, What, When, Where, Why and How:
| Table 1: Effective Communication Plan -- Who, What, When, Where, Why and How? |
| | Question | Answer | | Who? | Different target audiences | | What? | Six Sigma need, vision, strategy and results | | When? | Continual, ongoing | | Where? | Use a variety of media | | Why? | Set the tone, keep the organization informed | | How? | Clear, concise, continual - using a variety of media |
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Lessons From The Front Lines
Healthcare organizations already implementing Six Sigma can provide a wellspring of wisdom and advice for newcomers to this approach. Whether deploying Six Sigma within a small, rural hospital such as Thibodaux Regional Medical Center, or spreading it across a large multi-hospital organization like North Shore-Long Island Jewish Health System, there are some common communication strategies that can help to pave the way to a successful outcome.
Summarized below are insights from some of the healthcare providers actively applying Six Sigma within their own institutions:
Six Sigma Communication Tactics
As you begin to build your communication plan, consider the variation in your audiences and the methods that will be most appropriate for ensuring your messages are received and understood. If there are many people in the organization without access to email or computers, for example, reliance on web-based communications alone may not be a viable option. Also consider the messages that will be shared at different stages of deployment and establish a regular rhythm for communicating through a variety of channels.
The following is a list of some commonly used communication tactics:
- Face-to-face meetings
- Town halls
- CEO memo to employees
- Presentations at staff/management meetings
- Videotapes of key meetings
- Set of frequently asked questions and answers
- Customized pamphlets explaining Six Sigma in basic terms
- Brown bag lunches
- Communication Manager's toolkit
- Intranet posting updates
- Regular column in employee newsletter
- Separate Six Sigma newsletter
- Phone hotline
- E-mail
- Milestone recognition events
- Suggestion and question box
- Employee Surveys for feedback
- Quality quiz or crossword puzzle
- Posters
- Shirts with special logos for team members
Keep the Momentum Going
Once the Six Sigma initiative has been underway for a few months and the first wave of projects are entering the Control phase, make sure there is a plan in place for continually updating and reenergizing the organization, and visibly celebrating success. Distribute periodic reports sharing summaries, financial gains, survey results demonstrating increased patient and staff satisfaction or measurable improvements in service and clinical quality.
As the program takes root within the organization and results begin to multiply, many organizations feel more confident in communicating outside their own walls. Some begin to share case studies in healthcare journals, present at national forums or publicize their commitment to quality through consumer advertising. It was noted at the recent Quality Colloquium at Harvard that there is a growing trend toward direct to consumer (DTC) ads touting quality improvement.
A well-conceived communication plan will begin even before the first day of training or the first wave of projects has begun and will be woven throughout the initiative. Remember to communicate up, down and sideways across the organization. It's also wise to keep in mind that communication is an ongoing process - not a one-time event.
It has been often studied and repeated that over 60% of change initiatives fail. This failure is due in part to the absence of acceptance in the organization for whatever path the leadership has chosen. Building that acceptance begins with the development of solid communication strategies.
About The Author
Carolyn Pexton has over seventeen years experience in communications and healthcare and is currently serving as the director of communications for Performance Solutions at GE Medical Systems. She is a member of ASQ, Six Sigma Green Belt certified and has presented and published on topics including Six Sigma and change management within the healthcare industry. She can be reached by email at Carolyn.Pexton@med.ge.com.
GE Medical Systems delivers a Six Sigma courses designed exclusively for healthcare professionals. With these programs, those already trained in Six Sigma and change management are taking their individual and organizational success to the next level by leading others in achieving extraordinary results. This article is intended to help colleagues benefit from key learnings in this process. Everyone committed to improving the healthcare environment through Six Sigma shares a common goal, and will hopefully join us on our mission to liberate the leader in every Six Sigma practitioner.
