(continued from previous issue)
Productivity measurement & benchmarking in a hospital setup

D Prashant Bajaj

Resource consumption is one of the inputs required to develop performance indicators. Shortest Turn Around Time or STAT is important as tests and other services such as 24 hrs collection also take a toll on the consumption. For e.g. 10 tubes of a particular reagent can be used for 2 samples as well as 100 samples. But the tests are conducted as and when the samples come. Two samples may come in the morning and five in the evening. The problem is that the same tubes used in the morning cannot be used for the evening batch.

So, at this point of time certain thoughts come into the minds of the administrator: “Should I start the bus when the bus is full, or should I leave early?” Therefore while determining productivity these things have to be kept in mind. It is for the administration to decide which of the above are to be included in the productive and non-productive cost.

Benchmarking: Before reliable productivity standards are in place, the hospital should avoid external benchmarking. Such attempts usually end in failure if the hospital has not first established the discipline necessary for meeting productivity standards. Comparing its productivity with that of other hospitals requires the hospital to conduct complex analyses aimed at equating different types of patients, distinct medical practices, conflicting traditions, special tasks, and so forth.

Such a complex analysis can prove to be a formidable obstacle to achieve initial improvement. One of the pitfalls of using internal benchmarking is the difficulty in comparing functions. For example, several nursing units treating the same, or similar, types of patients could be compared, but the tasks within each unit could differ markedly. For this reason, it is sometimes best to perfom this analysis later on.

A productivity analysis should begin with an examination of each department’s performance over the past several years. This historical benchmarking provides a foundation to evaluate current performance. Next, a unit of service, or workload measure, should be assigned to every department, including departments whose staffing does not normally change with fluctuations in work volume. In most cases, the unit of service will be an actual product or featured service of the department, such as patient days, visits, procedures, or treatments.

If it is not possible to easily quantify the unit of service, the size of the department (based on total hours and total wages) can be related to the size of the hospital to provide a measure of the department’s growth compared with the hospital’s growth. Existing workload units should be used, but if these measures are illogical or unacceptable to the department managers/ consultants, the hospital should use different measures. A manager, for example, might not accept a unit of service that is obsolete or no longer describes the department’s product.

After an acceptable unit of service has been chosen, the same unit of service should be used consistently for each department being reviewed to facilitate reasonable comparisons, department by department, over several years.

For each department, hours-per-unit data should be compared with hours-per-unit data from the previous year, without distinguishing between fixed and variable costs, to calculate whether the department’s productivity improved or worsened. Then, the gain or loss in productivity should be multiplied by current workload volumes, at current salary rates, for each year. The results will illustrate the impact of changing productivity for the years studied, in both hours and wages.

Calculating financial impact of a department’s declining productivity on the hospital, for all departments will show the total financial impact of productivity changes on the hospital.

When the analysis is completed, the project manager should meet individually with each department manager to review the results of the productivity analysis and seek the department manager’s acceptance to use historical data as a guide when staffing for current workload volume. Discussing productivity improvement on an individual department basis not only helps overcome resistance to change, but also provides an opportunity to explain each manager’s role in achieving productivity goals and to learn more about the department’s operations.

If the hospital does not have staff with the appropriate expertise to conduct a productivity analysis objectively and implement changes based on the results, outside expertise should be sought.

Now that we have got the Actual Productivity levels and the Ideal or Theoretical Benchmarks are already available, we must now try to find out the Practical Benchmark which is achievable and yet has a scope or further improvement.

The Practical Benchmark can be determined by giving discounts or cuts to the Ideal or Theoretical Benchmarks. The discounts or cuts can be in the form of Logical Deductions, International Systems Protocol, Probability Concepts, Time Motion Studies or simply the Best Practices available. After the Practical Benchmark is determined, we should now find out the per cent achievement. The Actual Productivity Levels are compared with the Practical Benchmark leading to per cent Achievement with respect to Practical Benchmark.

The department should be able to decrease the gap between the Actual and Practical Performance within the stipulated period of time to improve efficiency.

(The author is resident trainee, administration, P D Hinduja Hospital, Mumbai)