Transfer Prices and Innovation in Public Healthcare: Costing and Clinical Choices in the NHS

The establishment of an internal market for clinical services in a publically funded National Health Service (NHS) requires a process for setting transfer prices. Given the values and logics of actors in a public healthcare system, attempts to determine an “optimal” price for specific treatments as prescribed by well-known transfer pricing texts, are likely to be inappropriate. Rejecting a reductionist model of Economic Man, the study adopted a richer perspective on actor reality through a pragmatic constructivist (PC) methodology. The PC methodology was used to interpret data drawn from a case study of a specialist healthcare centre of English NHS. The case study revealed different realities constructed by clinical and managerial actors. Clinical actors in the study were willing to spread a technological innovation but were not being supported by managers whose reality was influenced by centrally set tariff prices which favoured traditional high cost procedures rather than less costly technical innovations. Characterising the different realities as the “pragmatic truth” of managers and the “proactive truth” of clinicians, the challenge was to bring these together for a fully integrated and coherent solution. This challenge required avoiding a top-down “command and control” model of governance and greater flexibility for transfer pricing and incentives. More generally, the study supports alternative institutional mechanisms that can routinely promote the spread of new technological innovations which are not only clinically superior but, as this case illustrates, are sometimes cheaper than the current procedures

Assessing the Effectiveness of a Performance Evaluation System in the Public Health Care Sector: Some Novel Evidence from the Tuscany Region Experience

Since 80's the introduction of New Public Management principles has promoted the use of performance measurement to drive a more efficient, effective and accountable public sector. The adoption of a sophisticated and comprehensive multidimensional performance measurement system, which looks beyond traditional financial measures, based on organization strategies, such as the balanced scorecard, has thus been suggested. This revolution in the public management came together with the devolution processes that involved most European public health systems. Set within this context, in the last decade, each of the twenty Italian regions developed its own management tools. Among others, the Tuscan performance evaluation system (PES) has been valued as a particularly innovative and comprehensive system. This paper reports the novel experience of the Tuscan PES; in particular, it measures PES effectiveness and discusses the critical factors that could have led to the PES success. Five are the critical success factors identified by researchers: the visual reporting system, the linkage between PES and CEO's reward system, the public disclosure of data, the high level of employees and managers involvement into the entire process and the strong political commitment. All those factors run together to achieve better results; however, the process of development of the system plays a pivotal role. Scholars suggest the use of a constructive approach in order to gain effective changes in human organization. According to this stream of literature, this paper contributes by the novel experience of the Tuscan PES in addressing as a further fruitful application of the constructivist approach in healthcare

Supply chain sustainability performance measurement of small and medium sized enterprises using structural equation modeling

Sustainability of small and medium sized enterprises (SMEs) is significant as SMEs contribute to GDP substantially in every economy. This research develops an innovative sustainable supply chain performance measurement model for SMEs. Prior researches predominantly use balanced score card (BSC) approach that presume causal relationship of criteria and Data Envelopment Analysis (DEA), which derive efficiency of units from a few input and output criteria. While DEA is effective for policymakers, BSC is more suitable for individual SME. The proposed method that uses structural equation modeling (SEM) approach to derive the relationship of criteria and criteria weights formulates regression-type models for a specific region as well as for specific SME. The SEM-based supply chain sustainability performance measurement model is beneficial to policymakers as they can determine means for improvement at a regional level. The proposed method could also facilitate managers/owners of individual SMEs with measures for improving their supply chain sustainability performance. The method has been applied to three varied geographical locations in the UK, France and India in order to demonstrate its effectiveness

Scoring strategic performance: a pragmatic constructivist approach to strategic performance measurement

This paper analyses the characteristics of good strategic performance that contribute to the overall performance of a successful company. We apply a framework of pragmatic constructivism in order to analyse and measure strategic performance. We use the model for performance measurement based on pragmatic constructivism for the more specific topics of measuring, assessing and analysing strategic performance as opposed to operational performance. This paper analyses the characteristics of strategic performance that successfully enhance the overall performance of the company. The purpose is to outline a framework for strategic performance measurement that can be used to guide and measure strategic leadership. The framework focuses on the concepts of coherence and coherence tracing as the basic concepts for strategic performance and thus the task for strategic performance measurement.</p

Methodologies for managing performance measurement

6th Conference on Performance Measurement and Management Control Nice, France – September 7-9, (A1