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RE: Using a Leadership Capital Index to Measure the Performance of Medical Managers

Dr Chandrasiri’s article in the 2016 issue of The Quarterly “Using a Leadership Capital Index to Measure the Performance of Medical Managers” suggests a novel initiative which seeks to quantify leadership capabilities in an organization, akin to traditional KPIs such as bank balances and profit margins1.
The author comments that healthcare organisations should operate in a similar way to financial markets and that leadership levels in an organisation should be objectively measured in the same way that an auditor of a company can scrutinize the finances of the corporation.
Whilst the principles are sound, I think that this notion may underestimate the difficulties of objectively measuring leadership competence levels. Assuming that such levels should be measured externally, rather than in-house, the difficulty of this approach is that leadership assessment requires a high degree of familiarity with the processes, culture and personalities of an organisation2. An “auditor” of leadership skills cannot simply review bank statements and books of account.  What may appear to be only a mediocre performance of a manager may, on further deep investigation turn out to be excellence when the personalities of subordinates and recruitment patterns are considered. The auditor would need a thorough knowledge of the organisation, including its history, to pass objective comment on its managers. The assessment is complex and subtle.
Conversely, there are objective measures of performance in hospital management which are tangible and recognized. For example, nursing sensitive indicators (NSIs) measure performance by nurses of specific tasks and, it is reasonable to accept, that those measures indirectly reflect the quality of leadership of the managers to whom the nurses are responsible3. Medical performance can be examined by interrogating specific data collected by the Health Roundtable which allows for a hospital’s quality indicators to be benchmarked4. However, there may still be overarching issues that must be considered before the manager is too harshly judged.
There may be scope for management consultants to attempt to determine quantitatively core leadership skills and the capacity of individual medical managers to perform competently and effectively.  But this is unlikely to be a regularly occurring process.  The College has a role to play in developing further strategies to assist in the appraisal of performance. Leadership programs have been demonstrated to be effective in equipping staff with the requisite skills needed to lead an organisation: perhaps the focus should be on leadership development rather than on attempting numerical assessments.
Dr Felicity Jensen
1. Chandrasiri, S. Using a Leadership Capital Index to measure the performance of Medical Managers. The Quarterly 2016. Available from: http://www.racma.edu.au/index.php?option=com_content&view=article&id=833:using-a-leadership-capital-index-to-measure-the-performance-of-medical-managers-&catid=152:the-quarterly-2016&Itemid=543
2. Van Wijk R, Jansen J, Lyles M. Inter- and Intra-Organizational Knowledge Transfer: A Meta-Analytic Review and Assessment of its Antecedents and Consequences. Journal of Management Studies 2008 45(4):830-853.
3. Duffy J. The Clinical Leadership Role of the CNS in the Identification of Nursing-sensitive and Multidisciplinary Quality Indicator Sets. Clinical Nurse Specialist 2002 16(2):70-76.
4. O’Gorman C. Getting Traction with Clinicians – Using Health Roundtable Data to Improve Performance 2015 Available from: https://www.med.monash.edu.au%2Fassets%2Fdocs%2Fcreps%2F2015%2Fpresentingdata2015febchrisogorman.pdf.
Last Updated on Thursday, 29 June 2017 11:17