184 IEEE TRANSACTIONS ON INFORMATION TECHNOLOGY IN BIOMEDICINE, VOL. 9, NO.

2, JUNE 2005

Using Key Performance Indicators as

Knowledge-Management Tools at a Regional
Health-Care Authority Level
Alexander Berler, Sotiris Pavlopoulos, and Dimitris Koutsouris

Abstract—The advantages of the introduction of information happened when talking about health-care informatics. Thus,
and communication technologies in the complex health-care sector one can say that issues such as data management, data mod-
are already well-known and well-stated in the past. It is, never-
eling, and knowledge management (KM) have a long way to
theless, paradoxical that although the medical community has
embraced with satisfaction most of the technological discoveries cover before reaching the maturity level that other technologies
allowing the improvement in patient care, this has not happened have achieved in the medical sector.
when talking about health-care informatics. Taking the above Many reasons could be proposed for this, though with a short
issue of concern, our work proposes an information model for analysis it is rather clear that new ICTs are having integration
knowledge management (KM) based upon the use of key perfor-
mance indicators (KPIs) in health-care systems. Based upon the problems in health care because of the way this sector is orga-
use of the balanced scorecard (BSC) framework (Kaplan/Norton) nized. Health care is a strongly people-centered sector where
and quality assurance techniques in health care (Donabedian), ICT was dealt more as an intruder, as a spy to the health-care
this paper is proposing a patient journey centered approach that professionals’ way of doing things, and as a competitor to this
drives information flow at all levels of the day-to-day process of
delivering effective and managed care, toward information assess- people-centered model. Thus, if ICT intends to prove its advan-
ment and knowledge discovery. In order to persuade health-care tages toward establishing an information society and a much
decision-makers to assess the added value of KM tools, those more knowledge society, it has to focus on providing service-
should be used to propose new performance measurement and oriented solutions. In other words, it has to focus on people and
performance management techniques at all levels of a health-care
system. The proposed KPIs are forming a complete set of metrics this has not been the case in most of the circumstances. It is
that enable the performance management of a regional health-care common knowledge that in order to install any type of informa-
system. In addition, the performance framework established is tion system in health care, even more if it concerns KM, six main
technically applied by the use of state-of-the-art KM tools such as groups of issues [7], [8] have to be dealt with as cited below.
data warehouses and business intelligence information systems.
In that sense, the proposed infrastructure is, technologically The first issue is the organizational and cultural matters re-
speaking, an important KM tool that enables knowledge sharing lated to health care. This issue is rather important regardless of
amongst various health-care stakeholders and between different information systems since organization models and culture do
health-care groups. The use of BSC is an enabling framework not allow the continuity of care nor any type of structured data
toward a KM strategy in health care.
collection. Issues such as mistrust between different specialists,
Index Terms—Balanced scorecard (BSC), business intelligence, between the different health-care structure, between doctors and
health-care system performance management, key performance nurses, etc, are preventing in many cases the effective sharing of
indicators (KPIs), knowledge management (KM), regional
health-care authority. information. Health reforms are currently under way in many
countries stressing the will to deal with this problem.
The second issue is the technological gap between health-care
I. INTRODUCTION professionals and information science experts. Doctors are often
reluctant to use information systems that, as they say, are not de-
T HE ADVANTAGES of the introduction of information
and communication technologies (ICTs) in the complex
health-care sector have already been depicted and listed in the
signed for them. From another point of view, health-care infor-
matics have been introduced in health-care institutions mostly
health-care informatics bibliography [1]–[6]. It is nevertheless in pilot-based projects aimed at addressing specific issues and
paradoxical that although the medical community has embraced proposing solutions addressed for few health-care practitioners,
with satisfaction all major technological discoveries (i.e., mag- resulting in establishing a complex map of information niches.
netic resonance imaging, nuclear medicine, digital radiology, This approach is the consequence of applying information tech-
etc), allowing for the improvement in patient care, this has not nology to procedures that where not designed for it, thus cre-
ating a panspermia of information models that are not compat-
ible and interoperable even in a single institution environment.
Manuscript received December 1, 2003; revised April 26, 2004. Efforts are being made to create interoperability standards and
The authors are with the Biomedical Engineering Laboratory, School of protocols such as Health Level 7 (HL7) and solutions to this
Electrical and Computer Engineering, National Technical University of Athens
(NTUA), GR-157 73 Zografou, Athens, Greece (e-mail: [email protected]). issue are being proposed, thus enabling data manipulation and
Digital Object Identifier 10.1109/TITB.2005.847196 KM.
1089-7771/$20.00 © 2005 IEEE
BERLER et al.: USING KPIs AS KM TOOLS AT A REGIONAL HEALTH-CARE AUTHORITY LEVEL 185

The third issue is the legal requirements on the confidentiality the problem of dealing with the people-centered approach of
of personal data, of patient related data, and on data privacy. It is the health-care sector. This issue deals with information-system
clear that if this issue is not addressed at a managerial and proce- user friendliness, with usability issues such as the time to reach
dural level by imposing a policy for meeting those requirements, a data entry point, the speed of information retrieval, the quality
there is little chance that medical data will be digitally kept in of information retrieval, the complex security procedures, etc.
a structured manner, thus moving from digital islands of clin- In order to implement information systems and KM systems,
ical data toward a structured electronic health-care record. The education and training must be addressed with high priority
implementation of an information system where the electronic since user acceptability is strongly related to them. Service-ori-
health-care record is considered to be the core of the system (pa- ented models and patient-centered information systems have a
tient centered model) is the only way to drive data management higher chance of passing the user acceptability test. A system
toward creating new knowledge. The complexity of the problem that is not accepted by the user is often a system with poor data
can be explained if one just observes the course of implemen- quality (or no data at all) and KM, business intelligence, or data
tation of both the Health Information and Accountability Act warehousing solutions are, as a consequence, inoperable and
(HIPAA) in the U.S. [9] and the European Directive 95/46/EC unsuccessful.
[10] in the European Union. The issues seem to have been dealt Taking in all the above issues of concern, this paper describes
with at the strategic level but a lot has to be done in the imple- an information model for KM based upon the use of KPI in
mentation and setup of those strategies. health-care systems. The theory is based upon the use of the
The fourth issue is the industrial and market position of BSC framework (Kaplan/Norton) and quality assurance tech-
health-care informatics. In general, the health-care market is niques in health care (Donabedian), and proposing a patient
seen by the industry as large in size but not highly profitable, journey centered approach that drives information flow at all
mainly due to the lack of standards in implementing and in- levels of the day-to-day process of delivering effective and man-
teroperating health-care informatics products. The results of aged care, toward information assessment and knowledge dis-
those facts are that the industry has focused on creating mostly covery (both administrative and medical data). KPIs should be
small-scale products (i.e., laboratory information systems, seen as the strategic assessment tool for both the executive and
radiology information systems, clinical information systems, the clinical decision-makers that will lead health-care delivery
etc.) and not on designing information systems that are dealing to excellence and knowledge discovery and assessment.
with health care as a whole. This lack of an end-to-end solution
is dealt with by interconnecting heterogeneous information sys-
tems (a rather complex task with constant change management II. METHODS
issues) and by introducing solutions from other marketplaces,
i.e., enterprise resource planning (ERP) products, supply chain Today, KM is on everyone’s mind. Health-care organizations
management products, customer relationship management are no exception and are accepting the challenge to more ef-
products, and others, that have often been rejected by the key fectively share knowledge both inside and outside a health-care
users as noncompliant with their job description. Nevertheless, organization [11]. The growth of KM projects (i.e., decision
the new web technology approaches (web services, extensible support systems, data mining tools, business intelligence solu-
markup language, etc) and the new information technology tions, etc.) signals a growing conviction that managing insti-
strategies (i.e., service oriented architecture, etc) could be the tutional knowledge is crucial to business success and possibly
business survival. When the hype and confusion are stripped
drivers toward merging information technology and health-care
away, it is apparent that KM initiatives can profoundly change
services and, thus enabling the establishment of KM products.
a health-care enterprise for the better and bring numerous ad-
The fifth issue is the lack of vision and leadership of the
vantages to health-care information management (HIM) profes-
health-care managers and health authorities, and the lack of
sionals. For HIM professionals, KM is worthy of special atten-
willingness to reengineer the health-care processes [business
tion because it tells them not only how to do things but how
process reengineering (BPR)] for the benefits of efficiency and they might do them better. For this to happen, data should be
quality of care delivery. Some countries are in the process of provided in specific patterns and based upon a strategy that will
introducing or implementing such BPR projects in order to ad- empower a health-care system from the knowledge of its pro-
dress health-care delivery in a more information flow confor- cesses, its outcomes, and its structures.
mant way. This a key point in reaching KM, knowledge reuse, Despite the obvious advantages, many health-care decision-
and sharing, and finally proposing a solution for the knowl- makers view the idea of a KM initiative with skepticism, pos-
edge-based society of tomorrow. This issue should be dealt with sibly because of an incomplete or incorrect understanding of
by proposing strategies that focus on the process by establishing the tools needed to achieve it. Many of the tools and strategies
key performance indicators (KPIs), balanced scorecard (BSC), associated with implementing KM are not new; what is new is
or other metrics that are the upper level of a structured informa- a cohesive approach to KM design and implementation. Cer-
tion-flow-based model. tainly there are pit-falls and limitations in using information
Finally, the sixth issue, and maybe the most important one, technology for KM—trying to force fluid knowledge into rigid
focuses of the terms of user acceptability and usability of the data structures, for example, or focusing too much on the tools
proposed information systems. This issue is the most related to and not enough on the content. But networks and computers,
186 IEEE TRANSACTIONS ON INFORMATION TECHNOLOGY IN BIOMEDICINE, VOL. 9, NO. 2, JUNE 2005

Fig. 1. Regional health-care information systems framework and interoperability.

with their ability to connect people and store and retrieve vir- • Macroeconomic cost control: where the health-care sector
tually unlimited amounts of information, can dramatically im- should consume an “appropriate” share of GDP.
prove departmental efficiencies. In addition, health-care systems are often facing factors that
In order to persuade health-care decision-makers to assess put pressure on the system. As a consequence, an effective per-
the added value of KM tools, those should initially be used to formance management framework is the only solution toward
propose new performance measurement and performance man- controlling factors such as:
agement techniques at all levels of a health-care system [12]. • population aging;
In that sense, performance management has long been consid- • increased income and higher demand for health-care
ered a tool for controlling spending and increasing efficiency of services;
health-care systems [13]. There are three broad goals that gov- • increased access to health-care services;
ernments generally pursue in the health-care area. • increase of high technology usage where this new tech-
• Equity: where citizens should have access to some in- nology increases the health-care services usage creating
compressible minimum level of health care and treatment sometimes unnecessary demand (from a medical point of
based on the need for care rather than solely on income. view).
• Microeconomic efficiency: where quality of care and con- Most existing policies for controlling the performance of
sumer satisfaction should be maximized at minimum cost. health-care systems were based upon financial past results
BERLER et al.: USING KPIs AS KM TOOLS AT A REGIONAL HEALTH-CARE AUTHORITY LEVEL 187

TABLE I TABLE III

FINANCIAL KPIs IN A REGIONAL HEALTH-CARE SETTING PROCESSES KPIs IN A REGIONAL HEALTH-CARE SETTING

TABLE II
CUSTOMER (PATIENT) KPIs IN A REGIONAL HEALTH-CARE SETTING

Today, performance measurement is moving toward the

adoption of a set of objectives for a health-care system. There is
no complete agreement to our knowledge about what is meant
by “performance” of health systems and many sets of objectives
are proposed. We propose to use KPIs to establish this set of
objectives. The model is based upon the Donadebian approach
[14], where a health-care organization (i.e., a hospital) is a
system formed by the interaction of structures, processes, and
outcomes. Structures are used to establish processes in order
to create health-care outcomes that have an effect on structures
that need to change or adjust processes to meet the required
outcomes. Strongly believing that health-care outcomes are
more important than financial outcomes in a health-care system,
we are confronted with a model where intangible assets are
more important than tangible assets. This last statement makes
a health-care system very difficult to manage and hard to define
a straight-forward strategy.
assessment (macroeconomic control of spending and microef- In order to address this issue, our model used the BSC
ficiency improvements) by providing incentives to payers framework [15] initially proposed by Kaplan and Norton for
and providers of a health-care system. By their very nature, the strategic management of financial organizations in the mid
the financial measurements are not forward looking and are 1990s. This model has now proven its value and, since it is a
exclusionary to nonfinancial measures. generic framework, it is applicable to the health-care sector.
188 IEEE TRANSACTIONS ON INFORMATION TECHNOLOGY IN BIOMEDICINE, VOL. 9, NO. 2, JUNE 2005

TABLE IV TABLE V
LEARNING AND GROWTH KPIs IN A REGIONAL HEALTH-CARE SETTING CORRELATION OF KPIs AND WORKFLOW PROCESSES

The BSC concept involves creating a set of measurements for

four strategic perspectives:
• financial;
• customer;
• internal business process;
• learning and growth.
The above model enables the decision-makers also to value
how the latter three perspectives have worked, thus, it enables
us to measure intangible aspects of a system. The measurements
focus on a single strategy that can then be easily broken down
to the various levels of depth, depending of the organization
type. Thus, by using BSC, one can create a top-to-bottom de-
sign of a system, starting from the needed strategy (what is the
market, who are the customers, what are the critical processes,
what is required by the stakeholders) going down to design met-
rics, processes, structures, and finally, the needed technical and
functional specification to create an information system and a
KM framework capable of producing the right data and serve
the strategy.
Following that methodology, we have reached a set of KPIs
by assessing existing knowledge and future needs [16]–[18].
Those KPIs were processed especially to serve the new strategy
introduced in Greece that is proposing to organize the health-
care system in a regional health-care system approach.
In 2001, a reform of the Greek National Health-Care System
was introduced in order to enhance the performance and control
of health-care provision in Greece [19], [20]. One of the main
changes was the division of the country into 17 autonomous
health-care regions where the Regional Health-Care Authorities
(RHA) are responsible for the regional health-care strategy. This
reform introduced the need to establish a three-level decision- As described in Fig. 1, the regional health-care system is
making and performance-management mechanism as described comprised of a series of information systems (for example, a
in Fig. 1. hospital is covered by a hospital information system, which is
BERLER et al.: USING KPIs AS KM TOOLS AT A REGIONAL HEALTH-CARE AUTHORITY LEVEL 189

Fig. 2. Regional health-care authority business intelligence framework.

comprised of modules such as an ERP software, a patient admin- ment of a regional health-care system. In addition, the perfor-
istration module, and by clinical and other medical modules), mance framework established is technically applied by the use
covering all whole structures existing at any level the processes of state-of-the-art KM tools such as data warehouses and busi-
required to meet the administrative and medical needs (i.e., the ness intelligence information systems.
electronic health-care record (EHR) is the aggregation of all in-
formation related to a specific patient) and finally, the outcomes
III. RESULTS
that must come out from the implementation of such a com-
plex interpolation of informatics infrastructure. The above infor- As a result of the proposed framework, a set of KPIs have
mation model was introduced to establish a community of net- been reached in Greece at a Regional Health-Care Authority
worked health-care organizations (hospitals, primary care, etc.) Level, and categorized into the four perspectives stated by
that are interoperating in order to support and implement the Norton and Kaplan. The financial performance indicators are
new health-care strategy: to provide integrated and high-quality depicted in Table I and are the most important perspective of
health-care services to the citizens based upon equal access to BSC since it is the measurement of all others. The customer
the resources [21]. In order to achieve this goal, two main issues (patient) performance indicators are depicted in Table II and
were raised: How and when will information systems interop- represent the image of the system to its customers, i.e., the
erate? What is the minimum data set required to achieve the patients and the citizens in general. The processes performance
proposed strategy? indicators are depicted in Table III and represent how well the
The first issue is to be answered by using standards and pro- organization is structured to meet its predefined outcomes. The
tocols such as HL7 to meet with interoperability issues in health learning and growth performance indicators are depicted in
care [22]. The second issue is addressed by this paper, the results Table IV.
of which are presented below. The proposed KPIs are forming In order to meet and populate the above-mentioned KPIs, a
a complete set of metrics that enable the performance manage- regional health-care authority has to implement a complex in-
190 IEEE TRANSACTIONS ON INFORMATION TECHNOLOGY IN BIOMEDICINE, VOL. 9, NO. 2, JUNE 2005

Fig. 3. Patient journey centered model for a hospital institution.

formation technology in order to gather up all the needed infor- In other words, the model is completed by a business intelli-
mation. Then the collected information, through the use of ERP gence solution similar to the one depicted in Fig. 2.
software, of hospital information systems, of clinical informa- Fig. 2 shows how data are collected from the various data
tion systems, of radiology information system, of laboratory in- sources, cleansed and homogenized, and finally redistributed
formation systems, etc, has to be processed and interpolated to to the knowledge workers and decision-makers of the Regional
produce the final metadata set from which the KPIs are driven. Health-Care Authority (extraction, transformation, and load).
BERLER et al.: USING KPIs AS KM TOOLS AT A REGIONAL HEALTH-CARE AUTHORITY LEVEL 191

The data collection process is extremely important since it information as part and bits of knowledge. Knowledge can be
is a basic feature of populating successfully the KPIs. In that seen as a performance management tool both for administrative
sense, one should both consider organizational and technolog- purposes and clinical improvements.
ical issues to achieve data quality. In the proposed setting, the
Regional Health-Care Authority has imposed on its health-care
units the use of specific classifications, codifications, and tax-
onomies such as the tenth edition of the International Classifica-
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192 IEEE TRANSACTIONS ON INFORMATION TECHNOLOGY IN BIOMEDICINE, VOL. 9, NO. 2, JUNE 2005

Alexander Berler was born in Lausanne, Switzer- Sotiris Pavlopoulos received the degree in electrical
land, in 1969. He received the degree in electrical en- engineering from the University of Patras, Greece,
gineering from Aristotle University of Thessalonica, in 1987, and the Ph.D. degree in biomedical engi-
Greece, in 1995, and the M.Sc. degree in biomed- neering jointly from Rutgers University and Robert
ical engineering from the National Technical Univer- Wood Johnson Medical School, New Brunswick, NJ,
sity of Athens (NTUA), Athens, Greece, in 1997. He in 1992.
is currently pursuing the Ph.D. degree at NTUA in He is a Research Associate Professor at the Insti-
medical informatics focusing on the design and de- tute of Communication and Computer Systems, the
velopment of interoperable health-care information National Technical University of Athens, Greece. He
systems toward the implementation of a citizen vir- has published 5 book chapters, more than 30 journal
tual medical record. articles, and more than 45 refereed conference pa-
He has been with the Department of Electrical Engineering, NTUA, since pers. His research interests include medical informatics, telemedicine, medical
1996 as a Research Postgraduate Student working in the area of biomedical image and signal processing, and bioinformatics. He has been active in a number
engineering in European Union funded projects and he is currently working at of European and National R&D programs in the field of telematics applications
Information Society SA as a Project Manager in large health-care informatics in healthcare.
government project cofunded by the European Union under the 3rd Community
Support Framework.
Mr. Berler is a Student Member of IEEE Computer Society, IEEE EMB so-
ciety since 1998, a Member of ACM and the European Society on Engineering Dimitris Koutsouris was born in Serres, Greece,
in Medicine (ESEM) since 1998, and a BoD Member of HL7 Hellas, the Greek in 1955. He received the Diploma in electrical engi-
international affiliate of HL7 since 2003. neering, Greece, in 1978, the DEA in biomechanics,
France, in 1979, the Doctorat in genie biologie med-
icale, France, and the Doctorat d’ Etat in biomedical
engineering, France, 1984.
Since 1986, he was a Research Associate with
USC, Los Angeles, CA, Renè Dèscartes, Paris, and
Associate Professor at the School of Electrical and
Computer Engineering, National Technical Univer-
sity of Athens (NTUA). He is currently Professor
and head of the Biomedical Engineering Laboratory, NTUA. He has published
over 100 research articles and book chapters and more than 150 conference
communications. He has been principal investigator in many European and
national research programs, especially in the field of telematics in health care.
Prof. Koutsouris is President of the Greek Society of Biomedical Technology.