Thesis
“The value of business intelligence for healthcare providers that
focus on the elderly.”
Final version: 20-8-2014
Supervisor: dhr. prof. dr. T.M. van Engers Author: Maarten van der Poel
Student number: 5742676
Master Thesis: Information Studies – Business Information Systems University of Amsterdam Faculty of Science
Abstract
Healthcare providers that are focused on the elderly have a very important responsibility within Dutch society, i.e. delivering high quality care to the elderly. The number of elderly in the Netherlands is increasing and this raises the overall cost of the healthcare system. The Dutch government is changing laws and regulations in order to keep healthcare costs in check. Due to these changes the environment in which healthcare providers that are focused on the elderly function is continually changing and hence they have to be more focused on their performance in order to reduce costs. This study focuses on the healthcare providers that are focused on the elderly and how they can use Business Intelligence (BI) to monitor performance and to support the decision-making process within these organizations. The main research question of this study is: Which crucial factors determine a successful application of business intelligence for Dutch healthcare providers that focus on the elderly? With the use of literature and seven semi-structured interviews held with employees from four different healthcare organizations, this question was answered. The interviewed employees of healthcare providers said that their organizations are all struggling with their complex environments and that their main performance indicators are concerned with the finance aspects of the business. According to the literature, there are five performance areas for healthcare organizations, i.e. healthcare financial strength, healthcare operations, healthcare people development, patient service and satisfaction, and healthcare marketing. This study suggest that they should focus more on their primary processes, i.e. the performance areas of ‘healthcare operations’ and ‘patient service and satisfaction’. If they monitor their internal environment in a proper manner it will be easier for them to adapt their organizations to future legislative changes. BI should be used to monitor their internal environments and four implementation factors have to be kept in mind if these organizations want to implement BI successfully, i.e. management support, having a champion, resources, and user participation. BI could perform a crucial task for healthcare providers that focus on the elderly. It can help them to monitor their businesses, to support their decision-making process, to improve overall performance, and keep their clients more satisfied.
Table of Contents
1. Introduction ... 4
2. Dutch healthcare ... 5
3. History of decision support systems ... 5
4. Business intelligence ... 6
Introduction ... 6
Definitions of business intelligence ... 6
Implementation success of business intelligence ... 7
Performance in the public sector ... 10
Conceptual framework ... 13
5. Methodology ... 14
Theory ... 14
Semi-structured interviews ... 14
Semi-structured interview themes and coding ... 14
6. Results ... 15
Healthcare financial strength (economy) ... 15
Healthcare operations (economy) ... 16
Healthcare people development (efficiency) ... 17
Patient service and satisfaction (effectiveness) ... 18
Healthcare marketing (effectiveness) ... 19
Data quality ... 19
7. Analysis ... 21
8. Conclusion and discussion ... 24
How are healthcare providers that focus on the elderly currently monitoring their businesses? ... 24
What are the generic factors for successfully implementing business intelligence? ... 25
How can business intelligence be helpful with monitoring performance of the healthcare providers that focus on the elderly? ... 25
General finding ... 26
Discussion and limitation ... 26
9. References ... 27
10. Appendix 1 – Interview protocol ... 29
11. Appendix 2 – Interviews ... 30 Interview 1 ... 30 Interview 2 ... 45 Interview 3 ... 62 Interview 4 ... 75 Interview 5 ... 90 Interview 6 ... 106 Interview 7 ... 119
1. Introduction
Every organization has to make the right decisions to increase its chance of survival. The world is getting more complex due to the increase of data available to organizational decision makers and this poses a problem. Without the proper tools, measuring the performance of an organization is difficult. To overcome this problem, decisions makers need new tools to make sense of the data in order to translate it into meaningful information for their organization. According to the CBS (CBSa, 2014) the number of elderly people in the Netherlands has increased in the last years with an average of 3.2 percent, and the cost of elderly healthcare increased with 2,4 percent last year, i.e. 2013 (CBSb, 2014). The overall yearly growth in healthcare expenditure(s) in percentages (1.6 percent compared to 2012) of the Dutch healthcare system is decreasing and this is the lowest increase in 15 years. However, the overall costs are still increasing. The healthcare cost per capita increased slightly in recent years, from 5537 euro in 2012 to 5608 euro in 2013. The Dutch healthcare system should be affordable for society. Maintaining this system can prove to be challenging if the overall costs are too high, this could have serious consequences for the elderly, i.e. a decrease in quality or the danger of having no healthcare at all. For this reason, the Dutch government is continuously adapting laws and regulations in order to enhance or improve the healthcare system. This creates a complex, ever-changing environment for healthcare providers that provide care to elderly people in the Netherlands.
Elderly people make up a growing percentage of the Dutch society. This results in an ongoing increase in healthcare costs as well as creating a complex working environment for healthcare providers. The healthcare providers have to focus on performance. Hence they need the right information to make the right business decisions, in order to be valuable to society. This thesis focuses on healthcare providers that provide care to the elderly, and how they can cope with the complex business environment in the Netherlands.
The main research question for this study is as follows:
Which crucial factors determine a successful application of business intelligence for Dutch healthcare providers that focus on the elderly?
Sub questions:
1. How are healthcare providers that focus on the elderly currently monitoring their businesses?
2. What are the generic factors for successfully implementing business intelligence? 3. How can business intelligence be helpful with monitoring performance of the
2. Dutch healthcare
In 2006, the government of the Netherlands approved new healthcare legislation in an attempt to reform the Dutch healthcare system. The new legislation, which is called ‘Wet marktordening gezondheidszorg’, changed the role of the government from a ‘direct steering’ role to a more ‘safeguarding’ role (Schäfer et al., 2010, p. xxii). This reform meant the introduction of ‘managed competition’ and was realized to overcome the increasing costs of the Dutch healthcare system. This managed competition is applicable to three different sub-systems of the Dutch healthcare system, i.e. the health insurance market, the healthcare provision market, and the healthcare purchasing market. As a consequence of the reform, healthcare insurance companies are now able to choose with which healthcare provider they want to collaborate. This provides them with an advantage because they can look at the best price/quality ratio. As a result of this, the healthcare providers have to become more efficient and effective in order to keep up with the high demands of the insurance companies. Providing healthcare is about the lives of the people. This means that lowering quality, to be able to lower prices, is out of the question. As mentioned earlier, the government is acting in more of a safeguarding role to oversee if standards and regulations are met. To do so, the government founded a new institution, namely the Nederlandse Zorgautoriteit (NZa), which supervises the healthcare sector, health insurance companies, and healthcare providers as well as overseeing the implementation of standards and regulations.
As of the first of January 2015 (Rijksoverheid, 2014), several changes will take place in the Dutch healthcare branch. These changes affect healthcare organizations which provide care to the elderly. Currently, long-term care is being regulated by the ‘Exceptional Medical Expenses Act’ (Algemene Wet Bijzondere Ziektekosten, AWBZ). This act is being replaced by a new law called ‘wet Langdurige Zorg (WLZ)’ or in English ‘long-term care legislation’. This law concerns people with the highest need for long-term care. People who need a lower degree of care are paid by local government and this is being regulated by the new Social Support Act (Wmo). The AWBZ uses ‘care intensity packages’ (zorg zwaarte pakketten, ZZP). These care intensity packages are subdivided in separate entities that correspond with the need for care by a client (from low to high). The first two care intensity packages (ZZP 1 & 2) and, partially, care intensity package three (ZZP 3) are transferred to the Wmo and this care must be given at home (Onstweedethuis, 2014). This means that healthcare providers that focus on the elderly cannot put these people in their nursing homes and this poses a problem with regard to the income of these nursing homes.
3. History of decision support systems
Every now and then (or maybe every day), an organization stands at a crossroads and needs to make the right decision. Making this decision is not always easy and that is why people and organizations use information and tools to determine which decision is best suited to the situation. With the rise of big mainframes in the ‘60s, organizations started to computerize “[…] many of the operational aspects of their business organizations” (Arnott & Pervan, 2005, p.4). With the use of these mainframes so called ‘management information systems’(MIS) emerged. These systems were used to provide information to managers about the transactional processing systems for decision-making purposes (Arnott & Pervan, 2005). In 1971, the overarching term ‘decision support systems’ (DSS) was introduced in the paper of Gorry & Scott Morton (1971). They described DSS as systems “that support any managerial activity in decisions that are semi-structured or unstructured” (Arnott & Pervan,
2005, p. 5). Later on Keen & Scott Morton (1978) narrowed the definition used by Gorry & Scott Morton (1971) to only semi-structured decisions. Structured decisions are decisions that can be categorized as routine decisions. Unstructured decisions are novel and lack standard procedures and need more human judgment (Keen & Scott Morton, 1978, p.26). The semi-structured are basically a combination of the two aforementioned decisions and could be characterized as “[…](a) recurring decisions in (b) a dynamic decision environment with (c) reliable data on current position and (d) less-than-reliable projections of future states of the environment, and finally (e) clear objectives for performance” (Remus & Kottemann, 1987, p.233).
With the passing of time, the decision support field evolved and new decisions system concepts emerged. This study focuses on business intelligence (BI), which emerged from the concept of ‘executive information systems’ (Arnott & Pervan, 2005, p.6).
4. Business intelligence
IntroductionThe term Business Intelligence (BI) was first mentioned in an article by Luhn (1958) called “A business intelligence system”. His business intelligence system consists of two important aspects, i.e. a business system and an intelligence system. Luhn defined business as “[…] a collection of activities carried on for whatever purpose[…]” (Luhn, 1958 , p.314) and the intelligence system of a business as “The communication facility serving the conduct of a business […]” (Luhn, 1958 , p.314). So in brief, the intelligence system of a business is used for facilitating all the necessary communication to perform the necessary activities. In modern society, information and communication are indispensable and thus it is crucial to have a high quality intelligence system. Furthermore, the environment of an organization is constantly changing and as a result the business processes are becoming increasingly complex. Many businesses resorted to BI to acquire a better understanding of such a complex environment (Khan & Quadri, 2012).
The idea of BI originated in 1958 and thus could be considered relatively old, but be that as it may, BI has only recently become “[…] a major commercial concern for companies” (McBride, 2014, p. 58). In a worldwide survey of 1500 Chief Information Officers (CIO) the Gartner Group (2009) reported that BI was the number one technological priority on the list of the CIOs. McBride (2014) identified several factors which play a role in the increase of importance of BI in making critical business decisions, i.e. the increase of data sources, the rapid expansion of large databases, improved BI tools which do not require extensive IT skills, and media and trade journals changing the profile of BI.
Definitions of business intelligence
There is no unambiguous definition of BI and that is why several definitions of BI will be discussed and presented in this study. Generally speaking, there are two perspectives that can be used to define BI, i.e. an organizational/decision-making perspective and a technologic/architectural perspective.
The organizational/decision-making perspective describes BI as the decision process that aids in improving organizational performance. According to Reinschmidt & Francoise (2000), BI helps to improve the decision-making process and define it as: “Get the right data, discover its power, and share the value, BI transforms information into knowledge. Business Intelligence is the application of putting the right information into the hands of the right
user at the right time to support the decision-making process” (Reinschmidt & Francoise, 2000, p.4).
This definition is in accordance with the vision of Khan & Quadri (2012) that BI is an area of decision support systems. Also Vitt, Luckevich & Misner (2002) emphasize the importance of making relevant and useful decisions. They define BI as “[…] an approach to management that allows an organisation to define what information is useful and relevant to its corporate decision making.” (Vitt et al., 2002, p.13). These aforementioned definitions only talk about BI supporting the decision process, but according to Howson (2007) there are more advantages to BI. He defines BI as an activity that “[…] allows people at all levels of an organization to access, interact with, and analyse data to manage the business, improve performance, discover opportunities, and operate efficiently” (Howson, 2007, p.2). Gibson, Arnott & Carlsson (2004, p.296) discovered that better information, better strategies, better tactics and decisions, and more efficient processes were considered the most important benefits of BI development. It is important to note that the benefits described by Gibson, Arnott & Carlsson as well as the benefits described by Howson are all intangible benefits. Intangible benefits seem to be the most important perceived benefits of BI (Gibson et al., 2004, Hannula & Pirttimäki, 2003). Finally, I would like to note that the organizational perspective defines BI as processes and technology which support the decision-making process, thereby enhancing the performance of an organization.
The technologic/architectural perspective defines BI in terms of its components and the technology that is used. For example, Negash presents his BI data framework and defines BI systems as: “BI systems combine data gathering, data storage, and knowledge management with analytical tools to present complex internal and competitive information to planners and decision makers.” (Negash, 2004, p.178). Another architectural perspective is that of Khan who has developed a BI framework. Khan & Quadri (2012) noted that BI can be subdivided into three different parts, i.e. data capture/acquisition, data storage, and data access & analysis. I am not going to explain the model in depth, but I want to pinpoint a crucial component of BI, i.e. the data warehouse.
At the center of the BI framework lies the data warehouse. The data warehouse is the most important part of the BI framework (Khan & Quadri, 2012, p.66). It holds all the necessary information which can be used for decision-making and analyzing purposes. “A data warehouse (or smaller-scale data mart) is a specially prepared repository of data created to support decision making” (Wixom & Watson, 2001, p.18). As previously mentioned, this data warehouse is populated with data from existing data sources. The data warehouse could be used as a whole but is sometimes divided into so called data marts. To illustrate, these data marts could hold all the necessary data for a certain department. So it is just a selection of the data from the data warehouse but made specific for an entity.
As previously mentioned (and to reiterate), BI is not a new technology but merely a managerial philosophy and a tool used to help organizations manage and refine business information with the objective of making more effective business decisions (Ghoshal & Kim, 1986; Gilad & Gilad, 1986; Lönnqvist & Pirttimäki, 2006). Within the scope of this thesis the primary focus is on the organizational/decision-making perspective of BI.
Implementation success of business intelligence
The use of technology is an important aspect of BI. When talking about technology I mean every tool that can be used to support the decision-making process, e.g. the use of paper. There are many different technologies that support BI and, eventually, the decision-making
process. In this section not all of these different technologies will be described. Instead the most important part of BI will be discussed, i.e. the data warehouse, from the organizational/decision-making perspective.
Notwithstanding the many success stories, creating and implementing a data warehouse is not an easy feat, but rather a risky and expensive undertaking. As a results of this it is important that researchers and practitioners improve their overall understanding of the processes that lie at the core of data warehousing (Wixom & Watson, 2001, p. 18). In connection with this believe, Wixom & Watson (2001) conducted research into data warehouse implementation successes and developed a research model for data warehousing success as can be seen in figure 1. Because a data warehouse is seen as the most important part of BI, this model is used to explain the factors that have to be taken into account when implementing BI. As we can see in figure 1, system success is dependent on two factors, i.e. data quality and system quality. However, within the scope of this study the focus does not lie on any specific BI tool, my focus merely lies on the quality of the data which support the decision-making process.
Figure 1 - Research model for Data Warehousing Success (Wixom & Watson, 2001, p.20). 4.3.1. Implementation factors
4.3.1.1. Management Support
Management support is widely acknowledged as the most important factor (Yeoh & Koronios, 2010, p.26). Management sponsorship is required in order to get access to the necessary resources. If management supports BI, different kinds of organizational issues can be overcome. For example, Ang & Teo (2000) noticed an unwillingness by different individual departments to share their data. Management could impose regulations concerned with data sharing to improve data sharing.
4.3.1.2. Champion
Beside management support for BI it is also important to have a champion according to Wixom and Watson (2001). A champion is someone who actively supports and promotes BI. A champion could aid in creating awareness and improving the willingness to partake and thus regarding the aforementioned example of sharing data. Ang & Teo (2000) address this important factor as choosing a project leader.
4.3.1.3. Resources
Not too surprisingly, having enough resources is necessary and crucial. These resources include money, people, and time. By gaining a high degree of management support the necessary resources could be acquired or reserved.
4.3.1.4. User Participation
If BI is to have any value within an organization it is important that the users of BI partake in the implementation process of the BI environment. Therefore user participation in the development stage is important. “When users participate on warehousing projects, they have a better understanding of what the warehouse will provide, which makes them more likely to accept the warehouse when it is delivered.” (Wixom & Watson, 2011, p.24).
4.3.2. Implementation – Organizational success
When introducing a new tool or system there can potentially be resistance to change. BI could shift data ownership, business processes, access patterns etc. (Wixom & Watson, 2001). This could all lead to resistance and, if the overall resistance level is too high, the BI implementation tends to fail. So it is important that the organization supports the implementation of BI. According to Wixom & Watson the organizational implementation success is influenced by four implementation factors, i.e. management support, champion, resources, and user participation. Getting everyone on board the so-called BI train is of course the most important task to perform. If everyone is aboard, the organization could perceive the process of BI implementation as a success.
4.3.3. System success – Data quality
Without the prerequisite data, the decision-making process becomes an impossible undertaking to embark upon. Furthermore, the necessary data should be of good quality to ensure that the full picture of the environment is being presented to the user. A widely accepted concept in data quality literature is ‘the fitness of use’ (Wang & Strong, 1996). This concept emphasizes the data consumer point of view or contextual dimension (Nelson, Todd & Wixom, 2005). In the end, the consumer is judging the quality of the data when completing a specific task. Wang & Strong define data quality as “data that are fit for use by data consumers” (Wang & Strong, 1996, p. 6). See figure 2 for the Wang & Strong conceptual framework of data quality. For the contextual dimension good data means that it adds value, is relevant for the user, is being available right on time, is complete, and consists of the appropriate amount of data so that the user can easily interpret it.
Another way to look at data quality is the intrinsic dimension (Nelson, Todd & Wixom, 2005). One definition of the intrinsic dimension is “data quality is the measure of the agreement between the data views presented by and information system and that same data in the real world” (Orr, 1998, p. 67). The intrinsic dimension is concerned with the data being properly organized and denotes that “[…] data have quality in their own right” (Wang & Strong ,1996, p. 22). If we look at figure 2 we can see that the data should be accurate and objective so that it represents the real world. Wang & Strong also added believability and reputation of the data. If the user does not believe the data is based upon the real world or the data has no good reputation, it cannot taken seriously and is thus not relevant for the decision-making process. The accuracy of data is described as being true and with no errors. For example, the reports from a BI tool should not contain any data specific problems.
The third dimension of data quality is that of ‘representational data quality’. The data must be easy to interpret and the meaning should be clear. Also the format is important because
otherwise it is not readable by the user. Data consistency, or in the case of Wang & Strong ‘representational consistency’, is important for creating one ‘single version of the truth’ (Ariyachandra & Watson, 2006, p.18). The last dimension is the ‘accessibility data quality’ dimension. The data should be accessible by whoever might need it and it needs to be secure in order to maintain its quality. If somebody with no access rights could change the data than this could endanger the integrity of the data.
Figure 2 - A Conceptual Framework of Data Quality (Wang & Strong ,1996, p.20). Performance in the public sector
Public sector organizations differ in comparison to commercial organizations. “There is no profit maximizing focus, little potential for income generation and, generally speaking, no bottom line against which performance can ultimately be measured” (Boland & Fowler, 2000, p.417). Avison & Young (table 1) have compared the health sector to other sectors and identified that other industrial sectors have hard metrics but in the health branch people’s feelings and their available choices are taken into account as well. Therefore, performance is a thorny issue within the healthcare branch. Furthermore, on the management level there is an important difference that has to be addressed. Healthcare providers have to make decisions on clinical matters as well as operational matters, while the management of an organization in a different sector only has to focus on operational matters.
Data Quality Intrinsic Data Quality Believability Accuracy Objectivity Reputation Contextual Data Quality Value-added Relevancy Timeliness Completeness Appropriate amount of data Representational Data Quality Interpretability Ease of understanding Representational consistency Consise representation Accessibility Data Quality Accessibility Acces Security
Healthcare and other sectors
Differences Similarities
Management
-Unified in most sectors, but
healthcare has clinical and operational reporting.
Process orientation
-All sectors seek improvement in quality, cost, and delay through integrated processes
Customer
-Clear customer in most sectors, but healthcare involves variety, including clinicians, payors, government, service providers, and users.
Center of Attention
-Healthcare is becoming patient-centered, following product-centered and customer-centered success in other sectors.
Variants
-Few industries exceed tens of thousands of variants. Healthcare typically caters to many tens of millions of individuals.
System integration
-Although healthcare systems are typically larger, more complex, and employ more people than other systems, they still benefit from whole-system analysis.
Preferences and choice
-Most industrial systems have hard metrics, in healthcare, people’s feelings and choices matter, too.
Table 1 – Characteristics of healthcare and other sectors compared (Avison & Young, 2007, p.72). Golfarelli, Rizzi & Cella (2004) noticed that nowadays organizations are more process-oriented by synchronizing business activities and “[…] have understood the importance of enforcing achievement of the goals defined by their strategy through metrics-driven management” (Golfarelli, Rizzi, & Cella, 2004, p.1). As we can see in table 1, the healthcare branch is also process-oriented and seeks improvement in quality, cost, etc. Therefore managers need to continuously monitor their organizational performance with the use of key performance indicators (KPI). BI and a data warehouse can be used to monitor these KPIs. The strategy of the company is being communicated and monitored throughout the organization by translating the strategy into a detailed set of indicators. Golfarelli, Rizzi & Cella call this the business performance approach.
The performance management life-cycle can be subdivide into two levels and has four different stages (fig. 3). These two levels are the strategic level and the operational level. On the strategic level there are two stages which have to be followed, i.e. strategize and plan. In the strategize stage the complete strategy of the organizations is developed and in the plan phase this strategy is translated into KPI or other measures. The plan phase targets the process itself and how the strategy is being executed. In the operational level the aforementioned processes and measures are being monitored and analyzed. This is the third phase in the performance management life-cycle. The last stage is the stage of ‘take corrective action’ and is concerned about adjusting and improving the processes itself with the help of the information or new insights from the ‘monitor and analyze’ phase. These new findings can be used to improve the strategy and then the whole cycle starts all over again.
As we saw earlier, the public sector has some difficulties with defining performance and measuring this performance. In the public sector it is common to talk about the three E’s when talking about performance management (Boland & Fowler, 2000). These E’s are economy, efficiency and effectiveness. Performance in healthcare has to be perceived as a “[…]multidimensional phenomenon where the financial, respectively value perspective (economy) is only one dimension of the whole. It is also necessary to consider patient-related aspects (effectiveness) and procedural and knowledge-related aspects (efficiency)” (Mettler & Rohner, 2009, p.700). In the article written by Mettler & Rohner they refer to Mettler & Vimarlund (2009), and in this article the authors have identified five potential performance areas that can be used to measure performance in healthcare. Below these performance areas are outlined, with some examples presented with bullets.
1.Healthcare financial strength (economy) Revenue optimization
Productivity improvement Streamlining claims processing Waste and cost control
Activity-based costing 2.Healthcare operations (economy)
Partner management and measurement Collaboration opportunities
Agility improvement
Working capital and asset management 3.Healthcare people development (efficiency)
Provider experience measurement
Provider loyalty and the voice of the provider analysis Learning and growth measures
Innovation Knowledge
Culture and intangible value analytics
4.Patient service and satisfaction (effectiveness) Including patient experience
Engagement Delight
Loyalty and relationship measurement
Measuring and tracking the voice of the patient 5.Healthcare marketing (effectiveness)
Measuring and developing the growing importance of healthcare branding
Reputation and trust management Patient/customer segmentation Patient profitability
Patient lifetime value Conceptual framework
The first part of the conceptual framework is concerned with the implementation factors of BI that healthcare providers that focus on the elderly should be aware of. The second part of the conceptual framework is about the different performance areas a healthcare provider that focuses on the elderly should pay attention to. So the conceptual framework presents the prerequisite elements for implementing BI and the performance areas where BI can be helpful in monitoring these performance areas.
Figure 4 - The conceptual framework
Implementation Factors BI Management support Champion Resources User Participation -Organizational Implementation succes -Data quality
Healthcare
providers that
focus on the
elderly
Performance areas healthcare Healthcare financial strength
(economy) Healthcare operations
(economy) Healthcare people development (efficiency) Patient service and satisfaction
(effectiveness) Healthcare marketing
5. Methodology
This study consists of two parts, namely a theoretical part and a data collection part with the use of semi-structured interviews.
Theory
In the theoretical section two essential topics were discussed and explained. Firstly, the prerequisites of BI were explained to determine which factors influence the implementation of BI. BI supports decisions making and aggregates the necessary information for decision makers to make decisions and monitor performance. So if healthcare providers that focus on the elderly are going to use a BI tool, they need to know which factors influence a successful application of BI. Secondly, the concept of performance management was described and a summary was given of the general performance areas in the public sector, based on the literature. These performance areas are used to determine which areas of performance are currently being monitored by healthcare providers that focus on the elderly. This data is will be collected through the use of semi-structured interviews.
Semi-structured interviews
For the data collection part of this study a qualitative method was used in the form of semi-structured interviews. Semi-semi-structured interviews were held with seven different healthcare administrators from four different healthcare organizations that provide care for the elderly. The seven interviewees all have an administrative role instead within their organizations. The administrators of the four different organizations were interviewed to compare the differences between the organizations and to allow for application of triangulation (Bryman, 2008, p.700). These administrators are charged with developing business strategy and want to know how well their organizations are performing. The use of BI at the operational level lies outside the scope of this study. Below you can find a summary of the interviewees. It is important to note that ‘Organization 2’ only allowed for one interview. This is because they had little time. It was difficult to find healthcare providers that focus on the elderly that were willing to partake in this study, so ‘Organization 2’ is included in the study even though the other organizations allowed for two interviews.
Organization 1 Organization 2 Organization 3 Organization 4
Interviewee - 1 Location manager
Interviewee - 3 Chairman nursing & care Interviewee - 4 Controller Interviewee - 6 Chief Financial Officer (CFO) Interviewee - 2 Chief Information Officer (CIO) Interviewee - 5 Location manager Interviewee - 7 Senior business controller Table 2 - Overview of interviewees.
Semi-structured interview themes and coding
For the semi-structured interviews, five themes were used (section 10). A general theme for acquiring general information about the organization and the person interviewed as well as a general theme about IT in order to get acquainted with the IT landscape of the different healthcare providers. Furthermore, questions were asked about the IT systems these organizations use and if the interviewees were satisfied with these IT systems. The next theme has to do with the decisions that the interviewees have to make and which reports he/she receives in order to provide support for their decision-making process. The fourth theme was concerned with key performance indicators. This theme helped to gain insight in how these different healthcare providers that focus on the elderly monitor performance and which
performance areas they deem important enough to monitored. The last theme was concerned with information security and reliability and is in line with the data quality aspect. As we could see in the theoretical section, data quality is very important and that is why interviewees were asked how they cope with issues pertaining to data reliability. Afterwards, the interviews were coded using the five performance areas mentioned in section 4.4. and the concept of data quality mentioned in 4.3.3. For the fully transcribed and coded interviews, please see section 11.
6. Results
The changing of the AWBZ to the ‘long-term care legislation’ and the introduction of the Wmo, according to the interviewees, will have some profound effects on healthcare providers that focus on the elderly. They are all struggling with these changes and from this perspective together with the aforementioned performance areas and the concept of data quality, the results of the interviews will be described. The selected performance areas are:
Healthcare financial strength (economy) Healthcare operations (economy)
Healthcare people development (efficiency) Patient service and satisfaction (effectiveness) Healthcare marketing (effectiveness)
Healthcare financial strength (economy)
The overall financial situation of the healthcare providers was a topic which was extensively talked about with the healthcare administrators that were interviewed for this study. This is not surprising since all the interviewees are working within the administrative echelons of their respective organizations and ‘finance’ is always an important concern for an organization. Due to the financial and legislative changes, healthcare providers that focus on the elderly are aware of the fact that they are obliged to deliver care at home, when it comes to certain specific care intensity packages, as opposed to providing care within nursing homes that cater to larger groups of elderly people that require care. This affects the revenue of the healthcare providers. Interviewee 1 said that they expected a decrease in revenue of about 10 percent in the upcoming 2-3 years. However, with the separation between ‘care and living’ (see section 6.4), they are currently more optimistic about this estimation, i.e. they expect a smaller revenue reduction. Interviewee 3 said that his organization has to cut its budget by 30 million euros in the coming 3 to 4 years. He indicated that the profit margins within the healthcare branch that focuses on the elderly are small, so this probably means a reduction in personnel is inevitable, because the overall cost associated with healthcare staffing constitutes a considerable expense. Interviewee 6 mentioned that in certain scenarios you could expect a strong reduction. He did not elaborate on these different scenarios. Interviewee 5 criticized the changes that are being made by the government. According to this interviewee, the government wants healthcare providers to be more entrepreneurial but as a care provider you do not receive the proper tools to become a real care entrepreneur. “You still get a budget, you still get a budget ceiling. […], If I ask for more money it does not mean that I get more money. So entrepreneurship in the healthcare branch is basically a farce” (Interview 5, 11:00). Interviewee 4 is concerned with the decrease of funding in the home care sector. In the end, the funding is going to be too insufficient for healthcare providers that focus on the elderly to operate normally. Furthermore, she said that her organization is trying to increase its profit
margins in order to create a financial buffer or safety net. This buffer is necessary because it is getting more difficult to get a loan for healthcare providers that focus on the elderly. The healthcare branch is fast becoming a branch at risk with regard to the financial side of the business, she said. Regarding their financial situation, she said that some of their locations have budget surpluses and other locations have budget deficits. Thereby affecting the individual location managers in how they have to steer their locations. Interviewee 5 (location manager) stated that he has to compare his location with the other locations in order to ensure a financial equilibrium for the overall foundation. For example, if he increases his care production another location should decrease their care production. Interviewee 6 also mentioned the risk of having too much care production. If a healthcare provider is supposed to care for 400 people and they actually provide care for 430 people, this care could not be contracted and thus is not being paid. Therefore it is important to steer in a more direct way. To accomplish this, healthcare providers that focus on the elderly need more real or near real-time information.
As previously mentioned, the financial system is continually changing and this poses a problem for healthcare provider that focus on the elderly with regard the amount of money they receive per client. Interviewee 1 said that he used to know beforehand how much money he would be given for a specific client. Nowadays, he only knows how much money he is going to receive after the client is discharged. He mentioned that steering this new situation is much more complicated in comparison to the old situation. Furthermore, interviewee 3 also talked about the difference in receiving funding for their clients and said that they used to receive even more money if the expenses were higher than expected. Interviewee 2 recognized that the healthcare branch is not one of direct steering and indicated that nowadays they have to meet certain performance standards in order to get their funding. “When performance is getting more and more important, both with regard to persons as well as money etc. You need more real-time or near real-time information” (Interview 2, 30:14). With regard to direct steering, interviewee 3 said that their current information system is limited because it only presents a picture of the past (15:16). For example, a few weeks after the end of every month, they can see if it was a good or bad month. This of course, according to the interviewee, should not be the case and a BI tool should enable them to look into the future or evaluate the situation in near real-time. To get further acquainted with the impact of these financial changes, interviewee 4 said that they are comparing the different care products they deliver in order to determine what the maximum cost of these products should be and how these products differ from each other.
Healthcare operations (economy)
As previously mentioned, clients with lower indicated care intensity packages are no longer admitted into nursing home. Over the years, the healthcare providers that focus on the elderly acquired facilities to cope with the demand for care and housing and now they face a significant problem with regard to the vacancy of their facilities. Their solution to this problem is a separation between ‘care and living’ or in Dutch ‘scheiden van wonen en zorg’. Clients can rent homes or apartments from the healthcare providers and if they are in need of care, the healthcare provider can deliver care at their rented homes.
Interviewee 5 mentioned that they started with the concept of separation between care and living but that they currently do not really benefit from the separation between care and living. Interviewee 4 said that their care homes are not empty but she indicated that new steering information is needed in order to cope with this shift in finance, i.e. they are becoming a housing association. Interviewee 1 indicated that this transition is a major concern because some of the supporting staff have to be fired. “[…] we have to fire several hundred
people in the coming years, in particular in the supporting services” (Interview 1, 8:08). Because the elderly are going to have their own rented housing, they have to be more self-sufficient and this diminishes the need number for supporting staff. Interviewee 1 adds that the government reduces the cost of the healthcare system, but in doing so it increases the overall cost of the social security system. In the end, people need to have jobs or a monthly income. Interviewee 3 added that good employees have a significant impact on the quality of care, but that it is hard to acquire and retain good personnel. With all the changes, coping with these problems is difficult in order to “[…] remain a decent employer, without firing people, providing proper care, not letting people down, but also being adequately commercially prepared for the transition and the reduction of budget” (Interview 3, 4:04). So being a good employer is a major concern for healthcare providers that focus on the elderly.
At the operational level, the transition for intramural care to extramural care could be supported by BI. Interviewee 2, who works at a healthcare provider which has already implemented BI, said that they use BI for their autonomous care teams (Interview 2, 23:24). These care teams consist of 10-12 people who deliver care at home and were not autonomous before the implementation of the BI environment. They built a specific dashboard to give an overview of both the budget and staffing to support the decision-making process of these autonomous car teams. Interviewee 3 noted that they are struggling with this issue. Currently, their teams have a manager who tells them how well they are performing. “What you actually want is that the team itself gets more feeling [author: about performance]” (Interview 3, 13:54). He adds that they have not yet succeeded in creating something useful to make performance more transparent and more understandable for these autonomous care teams.
Healthcare people development (efficiency)
The subject of ‘healthcare people development’ was not a topic that was extensively talked about. Interviewee 1 said that his location is a large training facility that educates students and trainees that want to work in the healthcare industry. Because of this, he wants to be informed about the amount of students currently working at his location and if they find it enjoyable to work at his location.
Besides students, it is also important to know how your employees are doing and if they find it enjoyable to work within your organization. Interviewee 4 said that within her organization they noticed a correlation between the happiness of their employees and their clients. As previously mentioned in section 2.3, interviewee 3 said that it is hard to hire good personnel and that it is also a problem to retain employees within their organization. So developing people and keeping track of their development is important for quality and the organization itself.
Because of the transition from intramural care to extramural care, more knowledge is needed by the employees working on the operational level. Due to this transition, interviewee 4 told that his organization expects more of its employees that work at the operational level. Therefore these employees need the proper knowledge to meet their expectations. Interviewee 7 said that they create a personal education plan for every employee. She said that her organization has developed KPIs for tracking people development. However, she noticed that some employees are not going to their prescribed training sessions. So the KPI outcome is not meeting their expectations. She finds it strange that her organization does monitor a KPI but that there are no consequences and that there is no corrective action taken to fix this problem.
Patient service and satisfaction (effectiveness)
Quality of service is an important concern for healthcare providers that focus on the elderly. If their service is not adequate, or the clients find it unsatisfying, they could go to another healthcare provider that focuses on the elderly. That is why all the healthcare providers are conducting interviews or surveys to monitor client satisfaction. Interviewee 1 is a location manager who is concerned with rehabilitation of his clients and his location is conducting exit interviews when clients are discharged. He said that these interviews give a comprehensive picture of client satisfaction. However, he also stated that for him the final grade given by his clients is his main concern and that if this final grade is sufficient that he is satisfied. Regarding the separation between care and living, he hopes that they can do it in such a way that their clients have more money at the end of the month than they have nowadays, i.e. by reducing housing costs. He talked about the lowest social class having no money at the end of the month and he hopes that this changes. If they have some money left at the end of the month they can visit their relatives, which increases both the client satisfaction and their happiness in general. Interviewee 2 gave an example of how they increased client satisfaction by using their BI. Because they use different databases, some databases did not contain all the information on every client. This posed a problem for their service desk because it was difficult for them to see which care products one client had been given. The service desk had to look in different places or databases in order to obtain the required information. They integrated all the different databases into the data warehouse and provided the service desk with access to this data warehouse. It now acts as a customer relationship management layer and now their support desk can see which care products a client has been given. This improved the process and clients can now be helped much faster, thus increasing overall client satisfaction.
Interviewee 3 said that his organization also conducts customer satisfaction surveys and mentioned that they monitor so-called falling incidents. These falling incidents are catalogued and digitalized so they can follow a trend. If the organization can prevent falling incidents they improve their service and keep their clients more satisfied. As opposed to falling incidents, customer satisfaction surveys are difficult to digitalize because they contain a lot of qualitative data. Interviewee 3 sees this as a concern which they have to overcome. Besides asking clients about their perceived satisfaction, interviewee 3 stated that his organization also lets an external company audit their organization for quality of care. Furthermore, his organizations also lets the autonomous care teams grade themselves with a standardized questionnaire. All the data are aggregated per location and, in the end, for every sector In doing so, management gets a thorough picture of how well its organization is performing with regard the quality of care and client satisfaction.
Interviewee 4 said that client satisfaction concerning his organization is being measured once every two years. Her locations perform above average compared to the national average. She thinks that this has something to do with the fact that they have nice residences with an easygoing ambiance. As previously mentioned, she believes in a philosophy where the overall happiness of the employees leads to an increase in happiness among the clients. Interviewee 5 mentioned that his organization has enough tools to measure client satisfaction and added that he just talks to his clients at the coffee machine if he wants to know wants on their mind. Interviewee 7 said that as a healthcare provider you want to provide clients with quality care. On a national level there are so-called customer quality measurements. These results of each organization are compared to those of other healthcare providers that focus on the elderly, and if you have a comparative low grade this can have an effect on your bottom line. So there is
even an financial incentive in providing high quality care to the elderly clients of an organization.
Healthcare marketing (effectiveness)
As healthcare providers are becoming partially taken on the tasks of a housing association, they have to market their services. Interviewee 1 hoped that they could lower the housing costs of their clients. Such lower prices could prove to be a valuable marketing tool especially if an organization has a proper business plan and long-term strategy. However, measuring the effectiveness of a marketing campaign can be quite difficult. Interviewee 5 gave an example of one of their strategies, which is concerned with marketing. His organization want to be the so-called ‘neighborhood support center’ of their town and hopes that eventually more and more people will go to this center. Interviewee 5 mentioned that it is difficult to measure the outcome of such a marketing campaign. Furthermore, he mentioned that they analyzed the market in an attempt to find opportunities and threats. Healthcare providers that focus on the elderly should use the collected data pertaining to their environment to identify threats and opportunities.
Data quality
Interviewee 1 said he does not use his organization’s IT systems that often. He was not fully aware of the data warehouse his organization implemented. Maybe their user participation level was low with regard to the implementation factors of Wixom & Watson (2001). He receives information from their department of ‘planning and control’ which extracts information from the different systems or the data warehouse. He perceives the information that he receives as 95 percent accurate. When discussing data reliability he states that reliable people produce reliable information. He thinks that every piece of information should be inserted into the data warehouse. However, access to this information should be well-managed, because there are parties or employees which should not be allowed to have access to certain pieces of information. This is in line with the earlier outlined concept of ‘Accessibility Data Quality’(section 6.3.3.).
As previously mentioned in section 6.4., interviewee 2 talked about their CRM layer. This has something to do with ‘Contextual Data Quality’. The right amount of information (about clients) should always be provided and this information should always be on time. So here we can see why their previous systems not always provided the necessary contextual data quality. Interviewee 2 also talked about access and how to cope with this issue. With the use of an active directory they give users access to certain information. He told that some of their IT systems cannot cope with an active directory and that this means that every system should be individually managed when it comes to user rights. BI can be used to overcome this issue because all the information is centralized. Because the systems are updated by the software provider, they have a change management commission which ensures ‘Intrinsic Data Quality’, i.e. that the information is accurate and represents the real world. Interviewee 4 said that they have a test environment to test the changes to the system.
Interviewee 3 said that the information systems of his organization hold a lot of information and this could pose a problem for some users. According to interviewee 3, 90 percent of the information is not being used by managers. So a manager needs to receive the appropriate amount of suitable information in order to make the right decisions. If the manager is confronted with too much information the information could lose its value and it could lead to the manager disregarding such information completely. 90 percent of the information is being used by the business controller and he or she should support the manager in finding the
appropriate and suitable information. This is in line with the concept of ‘Contextual Data Quality’, i.e. receiving the appropriate amount of data.
Interviewee 4 indicated that her organization has a lot of information of a qualitative nature. They have to standardize this information in order to use this information. They ensure data quality by performing double checks. They export the information from their systems to Excel and they have to check this information to see whether or not the data transfer was conducted properly. Interviewee 5 indicated that you can have a proper information system but this system only adds value if the necessary information is on time. He thinks that an information system should allow users to save time because the required information should be easier to access than it would be without such a system. He also believes that all the available data should be in their information system if the user authorization is well-managed.
Interviewee 6 that his organizations exports information from their databases to Excel. This is a very laborious job and that is why they are searching for new opportunities for data management such as BI. He adds that they have to be aware of the fact that they have a very flexible information system, i.e. Excel, and should always check the data after the export. Developing a BI environment is expensive, hence their organization wants to know what the added value of such a BI solution is before deciding whether or not to invest in such a BI solution. Interviewee 7 mentioned that she lacks the ability to easily compare different kinds of data. This, of course, has to do with the fact that Excel sheets are not really suitable for the job.
7. Analysis
The interviews yielded one very important insight, i.e. healthcare providers that focus on the elderly are worried about the future and do not know what the future might bring them. From a financial perspective we could say that they are worried about their budget, the payments they receive for clients and production, and a decrease of the rate of home care. From the operational point of view, they are concerned about their assets, i.e. housing and personnel and how they can manage their operations and provide care at home with autonomous care groups. They are concerned about client satisfaction and indicate that they are monitoring this performance indicator. These healthcare providers assess their employees and try train them, but the interviewees did not talked about this topic extensively. Marketing and branding are becoming more important due to the fact that these organizations have to market their services, to reduce the problem of vacancy. Overall, I would like to point out that Dutch healthcare providers that focus on the elderly are currently more concerned about their finances than they are about their primary process, i.e. providing care and satisfying clients. The results could be somewhat skewed because the interviewees were all from the administrative echelons of their respective organizations. But it was noticeable that they interviewees never really mentioned their concerns pertaining to their primary processes of their organizations. Rather, they are looking at their external environment instead of their own internal environment.
If we look at the performance management life-cycle (section 6.4), we see that the KPIs are being developed in the ‘plan’ phase and that they are derived from the overall business strategy. But if you, as an organization, function in a dynamic and constantly changing environment, how can you develop a thorough strategy for the next 3-5 years? It is difficult to develop a strategy for the coming next 3-5 years if you do not even know what kind of impact the current legislative changes will have on your organization. Thus, healthcare providers that focus on the elderly should develop a strategy based on their internal environments because their external environments are too blurry and complex. So is the performance management life-cycle for healthcare providers that focus on the elderly an effective model to use?
This study shows that the performance management life-cycle is not a completely effective model for performance management by healthcare providers that focus on the elderly. In an article by the Passionned Group (2012), Adolfsen states that the healthcare branch is currently collecting a lot of data but does not have a lot of knowledge. Adolfsen notes that balanced score cards and , consequently KPIs, are only being used for internal and external accountability, but these measurements should also be used to gain insight in the primary process, i.e. providing care.
That is why healthcare providers that focus on the elderly should have a bottom-up approach for managing their performance, as can be seen in figure 4. The performance management life-cycle starts from a strategic level but the adjusted performance management life-cycle starts from the operational level. First of all, the question should be asked what kind of data is necessary to support the primary process of care in order to find the necessary general performance indicators. These general performance indicators do not have to be key performance indicators. For example, a performance indicator could be the minimal number of clients a nurse has to deliver care to on a daily basis. This performance indicator cannot be very important for an overall business strategy. After the information about the general process is acquired, a strategy can be developed, or adjusted, with the inclusion of the key performance indicators. If the environment is affected by legislative changes, you can
instantly see if your primary process is affected or not (monitor and analyze). This also makes it possible to take corrective action. Such corrective action could constitute a change in the overall business strategy and day to day operations of the organization. This means that healthcare providers that focus on the elderly should have short-term strategies focused on their primary process. These short-term strategies are needed because their environment is constantly changing. Due to legislative changes it could be the case that the key performance indicators change and this eventually changes the strategy.
Figure 4 - Healthcare providers that focus on the elderly performance life-cycle
I asked the interviewees which KPIs their organizations have developed and are currently still in use. The general answer did not pertain to the personal KPIs that they find important but merely to the generic themes of their KPIs. In general, the first theme noted was finance. This is not really unusual, as a financially healthy organization is considered to be a valuable organization. However, the question is to whom are they considered to be valuable and who wants to see these numbers?
I also asked to whom the interviewees are directly accountable to. They all answered that they are accountable to their Board of Directors. So the Board of Directors are the ones that want to see these numbers and find the KPI of finance very valuable. The Board of Directors are normally looking at the health of their organization and its future direction, and are not really focused on the primary process. So the KPIs which are being used by the healthcare providers that focus on the elderly are currently developed and used at the highest level of the organization and should be developed from the operational level and used by this operational level. To support this studies concern, interviewee 2 told an interesting story. Their dashboard which acts as a presentation layer on top of the data warehouse was initially developed for the Board of Directors. He told that his location managers always said that they preferred to have their own KPIs. But at the end, when they were asked to express their KPIs, they did not really ask for new KPIs. The present dashboard was sufficient. This means that their location managers are not really using their BI environment to improve their processes. They are merely looking at the financial aspect of their organization. BI should enable decision-makers to make the right decision on every organizational level and on different performance areas. And the performance areas considered to be the most valuable are ‘patient service and satisfaction’ and ‘healthcare operations’.
Identify operational performance indicators Pick key performance indicators for the
strategy
Monitor and analyze Take corrective
So if we look at healthcare providers that focus on the elderly, what is necessary for valuable BI? One important performance area is ‘patient service and satisfaction’. Spruit, Vroon & Batenburg (2014), also interviewed healthcare providers that focus on the elderly and identified customer experience as the most performance important area, see figure 5. They indicate that this data is being collected by external parties. The healthcare providers should collect this data and standardize this data so it can be inserted in their BI environment. By doing this, healthcare organizations could use this information to support the decision-making process which is focused on the primary process.
Figure 5 – The top 10 information needs at the long-term care institutions (Spruit, Vroon & Batenburg, 2014) As can be seen in figure 5, Spruit, Vroon & Batenburg also discovered a lot of financial information needs by long-term care institutions. Notice that these financial information needs are all focused on the primary process. The financial information need is concerned with the amount of money they receive for their clients and how they can improve the care process in order to lower the cost. If they want to acquire this information they have to monitor the process of providing care to their clients that is the performance area of ‘healthcare operations’. Therefore, healthcare providers that focus on the elderly should develop a business intelligence tool from the perspective of the client. BI should make this process transparent.
In general, the people interviewed for this study did not extensively talk about care intensity packages. However, these care intensity packages are “[…] the most important indicator for directors in order to control the expenditure and revenue” (Spruit, Vroon & Batenburg, 2014, p.700). These care intensity packages are important for the operational level and could indicate the consequences of legislative changes. Furthermore, the flow of information regarding the care intensity packages should be monitored to make predictions about the future. Historical data is required to do so and this finding is in accordance with the view of interviewee 3, who said that their information systems should be used for forecasting.
Lastly, a BI environment/tool is necessary for aggregating the necessary data and to make sense out of all the data. In section 6.1., I referred to McBride (2014) and McBride identified several factors which have some degree of influence on the increased importance of BI. I would like to point out two important factors for healthcare providers that focus on the elderly, i.e. the increase of data sources and the rapid expansions of large databases. The aforementioned healthcare providers have multiple data sources and these data sources could increase even further in the future. If there are too many data sources and there is not a tool
