Accreditation & Regulatory Journal
February 2024

CIHQ-ARS Article

Engaging Department Leaders to Measure and Improve Productivity

Provided By: HealthTech
By: Carolyn St. Charles, RN, BSN, MBA, Chief Clinical Officer HealthTech
Cheri Benander, RN, MSN, CHC, C-NHCE, Clinical and Compliance Consultant
Productivity is an important tool in healthcare to measure the efficiency of a department and the healthcare system overall. The fewer resources you use, the more productive you are, and vice versa.
In healthcare, Quality, Safety, and Productivity are inextricably linked. If a department or group of departments is not appropriately staffed there may be patient safety occurrences, or increased hospital-acquired conditions such as surgical site infections or ventilator-associated pneumonia. There may also be decreased patient satisfaction.
Although quality and safety must always be the first consideration when assessing productivity, studies have shown that patient outcomes can also be adversely impacted by overstaffing. The key is to find the right staffing to ensure each department is run efficiently and safely while delivering excellent quality.
What is Productivity and How Is It Measured
Productivity measures the efficiency with which you can produce different outputs. Productivity shows how efficiently you can turn your inputs such as materials, time, people, and any other resource, into a final result, typically a product or service.
In healthcare, productivity is measured by worked hours per unit of service or labor cost per unit of service. Worked hours include all hours worked excluding vacation, holiday, sick time, or a leave of absence. Some organizations include staff education in worked hours, others exclude it.
The unit of measure that is used will depend on the department. Most nursing departments typically use patient days. Outpatient departments may use visits, cases, or procedures. Plant operations and environmental services typically use square feet. Regardless of the unit of measure, it’s critical that the volume can be accurately captured, ideally from the billing system.
It’s important to note that any contract or registry staff, not just employed staff, should be included in worked hours. For example, if you have a contract dietician, the hours need to be included in the dietary department. If you use registry or agency staff, their hours should be allocated to the department where they are working.
Setting Targets
You can’t really know if you are operating efficiently unless you are being measured against a target. Setting a productivity target for every department, with input from department managers, should be done at least annually as part of the budget cycle.
The steps in setting targets should include a review of the following (10) questions for each department:
  1. What has been the volume for the last six months?
  2. What has been the staffing for the last six months?
  3. What are the hours of operation? Do the hours of operation need to be revised? And, if so, how will this impact staffing?
  4. What has been the percentage of overtime? Can overtime be reduced?
  5. Are there any anticipated changes in the staff mix?
  6. Will there be any additional education hours or expenses such as the addition of a nurse or medical imaging residency program?
  7. Are there any expected changes in service lines or new technology within the next year that will impact staffing?
  8. Does the department require minimum staffing levels regardless of volume?
  9. Are there opportunities to work with other departments to improve efficiency?
  10. Are there ways to be more efficient?
Improving Productivity is About Systems Not People
Healthcare organizations are complex organizations, defined by a high degree of interdependencies among people, which impacts productivity. Edward Deming in his book Out of Crisis found that “94% of most problems and possibilities for improvement belong to the system, not the individuals”.
Some examples of interdependency in healthcare include:
  1. Response time to the emergency department by the Laboratory or Medical Imaging
  2. Time for Environmental Services to clean a room after a patient is discharged
  3. Lack of staffing in intensive care or med-surg requiring that patients are held in the emergency department
  4. Missing supplies or supplies that can’t be easily located
  5. Lack of pre-medication by nursing for patients prior to Physical Therapy
One response to these common occurrences may be to blame the other department (or individual), but in fact, these are all system issues and usually beyond the control of an individual.
So how do we work together as a team to attack system issues, improve efficiency, and at the same time improve patient outcomes and satisfaction? Here’s some thoughts.
  1. Educate staff and managers to use analytic tools:
    • Go to GEMBA: Go and see what is really happening. This tool is especially useful for managers and senior leaders to understand the work and barriers to efficiency.
    • Evaluate staffing by completing a Root Cause analysis within the department or with multiple departments. Examples of tools include 5 Why’s and Fishbone or Ishikawa Diagram.
  2. Implement 5S which is system of organization so that items are easy to find.
  3. Streamline documentation: Ask the following questions: Why are we documenting this? Do we need to document this? Do we need to document as frequently as we are now? Are we documenting the same thing in multiple places? Is there an easier way?
  4. Standardize order sets and develop protocols to provide more efficient care and documentation.
  5. Evaluate if everyone is working to the top of their license. Ensure there are clear boundaries delineating what level and type of care is appropriate for an individual depending on their level of education, training, and licensure.
Strategies for Engaging Managers
At the end of the day, managers are responsible for the productivity in their departments. To improve manager engagement, consider the following strategies:
  1. Educate managers about productivity including how to read reports and analyze staffing.
  2. Set realistic targets. If a manager is not involved in developing the target for their department, they will not be invested in either meeting or improving productivity. For example, minimum staffing, 1-1 care including sitters, and physical location of departments will all impact productivity.
  3. Update targets when there is a significant change in work or a new process. Don’t wait until the end of the year. It is demoralizing for a manager to have to write a variance report for a new service that has been approved and requires additional staffing, but the department productivity target has not been updated.
  4. Recognize that some problems may not have an immediate solution such as staffing shortages, staff turnover and mandated staffing ratios.
  5. Invest in LEAN principles and tools.
  6. Educate managers about how to work as a team.
  7. Involve staff and providers in developing solutions.
  8. Celebrate! According to research from Gallup, employees who receive regular recognition and praise: Increase their own productivity, increase engagement among their coworkers, are more likely to stay with the organization longer, and receive higher loyalty and satisfaction scores from customers.
Managing and improving productivity in healthcare is an ongoing effort that requires an investment by every part of the organization. Viewing productivity as an interdependent system and not just the responsibility of a single department manager is a critical construct to ensure that the organization functions both efficiently and cost-effectively.