I read the piece written by my colleague Monica E. Oss about the importance of managing to your customer’s performance expectations — What ‘Performance’ Should Your Team Care About? Look At Your Health Plan’s Contract — and thought about the challenges of making that a reality in the non-profit organizations that I work with.
From a management perspective, many non-profit organizations are struggling with the basics of Medicaid reimbursement and fee-for-service contracting with health plans. The move toward value-based reimbursement — and the need for performance measurement and performance optimization — just adds to the pressure to reinvent both organizational infrastructure and culture.
One of the CEOs that I work with recently implemented training in performance management and much to her surprise, found that her leadership team did not really understand the concept. Additionally, what came out of this discussion was that the leadership staff did not feel “engaged” to the point of being responsible for the overall performance outcome of the organization. This led to a very important conclusion by the CEO – the leadership staff needed specific instruction and precise descriptions of their responsibilities to both their staff and for the outcomes of the team and agency as a whole. I believe this is a common problem in many of our non-profits today. Performance management principles are just not on the table for discussion and this topic should be addressed and integrated into leadership meetings and individual supervisions.
To shift to organizational management models based on performance and value, there are a number of competencies that non-profit management teams need to master. My “hit list” of recommendations includes:
- Creating easily understood job descriptions and employee performance plans, which includes the key performance indicators needed
- Finding the talent needed through a strong system of recruitment, hiring, and retention — “getting the right people on the bus”
- Building management competencies in supervision, coaching, and feedback to employees and reviewing employee performance based on quantifiable performance plans
- Instituting compensation plans that reward those employees who excel or exceed the expectations for their role
- Capturing data and using that data to assure that desired organizational outcomes are being achieved while making organizational changes needed to get performance on track
- Developing the “tradecraft” in the executive team to know the organizational operating metrics well enough to negotiate sustainable performance-based contracts with payers
This shift demands that non-profit executives in health and human services develop an ability to manage to the payer market. They need to understand the market rates and competitive landscape while reengineering operating processes and service costs to meet the market. This means having the ability to gather and report the relevant performance data and building an management team than can use that data in real-time.
Information literacy and metrics-based performance management will separate the struggling organizations from the thriving organizations. The leadership challenge for executives of non-profit organizations is leading this change.
For more, check out these presentations by my colleague Monica E. Oss from our recent OPEN MINDS Performance Management Institutes.
- The Transition To Value: Addressing The Triple Challenge Of Performance Measurement, Talent & Capital
- Are You Really Ready For Value-Based Payment? Planning Your Move To Pay-For-Value
- The (Inescapable) New Value Equation In Health & Human Services: Why It Will Determine Who Succeeds
- The Shifting Path To Successful Organizational Performance
- The Performance Measures That Matter: Keys To Competitive Advantage In A Market Focused On A Cost Curve
And for even more, don’t miss the session, “Problem Solving For Performance: How To Implement A Quality Management Program” on September 26 at The 2017 OPEN MINDS Executive Leadership Retreat, in Gettysburg, Pennsylvania.