Week 9


Chapter 7 Notes:

Designing Organizations for Performance Excellence


  1. Organizational Structure
  • The effectiveness of an organization depends in part on its organizational structure-the clarification of authority, responsibility, reporting lines, and performance standards among individuals at each level of the organization.
  • It is important for a healthcare organization to determine the roles of its leadership group and governing board within the PI program.
  • PI activities require organizational and individual commitment and need to be incorporated into the daily operations of the organization.
  • Leadership endorsement of Performance Improvement (PI) is crucial and integral contribution to an organization’s continuous development.


  1. The Functional Structure
  • Functional structures provide organization with a clear chain of command and allow people to specialize in the aspect of work for which they are best suited.
  • Functional structures are common in service organizations at business unit levels.
  • From a TQ point of view, the functional structure has several inadequacies.
  • The Functional structures separates employees from customers
  • The leaders of a healthcare organization set expectations, develops plans, and hire employees to implement procedure that assess and improve quality of important functions.



Figure 1 Functional Structure for a Manufacturing Company



Board of Directors (aka Governing Body or Trustees)

  • Board of Directors (BOD) bears the ultimate responsibility for the quality of patient care provided by its organization
  • Board designates an executive (typically the CEO) to be its agent or managing partner and is responsible for implementing board directives.
  • The BOD is appointed by the community at large
  • Typically most do not have expertise in clinical processes or are healthcare professionals.


There are 3 main components of a healthcare organization that share common interests and must work together on planning, budgeting, capital development, expenditures, etc.:

  • The governance
  • The management (leaders)—responsible for the strategic plan
  • The employed staff


**The community and populations the organization serves expect that the organization will provide the highest quality products and services possible.


Strategic Planning

  • An organization’s strategic plan contains: overall mission, vision, and goals
  • Is developed by the organization’s senior leaders and BOD
  • Strategic Planning may include a process called SWOT Analysis-in which leaders complete an assessment of the organization’s strengths, weaknesses, opportunities, and threats



PI Plan Design

  • A written plan that systematically describes the structure and approach the organization will follow in the continuous assessment and improvement of its important systems, processes, and outcomes of care.
  • The organization’s leaders have a central role in initiating and maintaining the organization’s PI priorities (implementation of the organization-wide PI Plan)


Managing the Board of Directors’ PI Activities

  • Coordination of the program
  • Clinical and nonclinical program monitoring
  • Organization of services and departments to carry out PI program

Reporting frequency, format, and timing (Dye 1991)


  • Dashboard-a comparative data format on the myriad of functions the organization performs (etc. quality of care, etc.).



Key Elements That Affect the Board’s Ability to Carry Out PI Responsibilities

  • The board’s understanding of the quality assessment and improvement system
  • Adequate reporting to the board by staff
  • The board’s oversight and approval of the process to ensure the continued competence of staff
  • The board’s active questioning of the information (Umbdenstock 1992)


Standing Committees of the Medical Staff

In addition to the leadership and the BOD, 3 other important organizational resources should be considered by the HC organizations as they plan PI programs

  • Standing committees of the medical staff
  • A New Hire and on-going staff development program
  • Formal quality management structure


Standing committees (of the medical staff) are organized to review specific aspects of patient care services.

Members are drawn from the medical staff, nursing staff, and administrative areas related to that specialty.

  • Ethics


  • Credentials


  • Pharmacy and Therapeutics


  • Utilization and Documentation Standards


  • Environmental Safety


  • Departmental


The intent of the review is to identify case specific patterns of care that could have achieved better outcomes had the care processes involved been better designed or implemented.


Peer Review—type of care review by one’s colleagues



Performance Improvement Education

  • Communication of mission, vision, and values
  • PI training at new-hire orientation
  • Supplemental training annually



Formal Quality Management Structures

A formal QM structure (aka PI Department):

  • Can centralize an organization’s quality efforts
  • can help an organization manage PI related information and activities
  • can be the organization’s experts in facilitating PI team activities and using the QI Toolbox techniques
  • can take the lead in educating leaders and staff on the principles of PI, data collection and data analysis and any regulatory changes that occur
  • can take the lead in developing cross functional and functional PI teams


"Looking for a Similar Assignment? Order now and Get 10% Discount! Use Code "Newclient"