Issues for academic health centers to consider before implementing a balanced-scorecard effort

Because of changes in the health care environment, it is likely that strate gic planning and management will become much more important to academic hea lth centers (AHCs) than in the past. One approach to strategic planning and management that is gaining the considerable interest of health care organi zations is the balanced scorecard. Based on a year's experience in examinin g this management took, and on early implementation efforts, the authors cr itically evaluate the applicability of the balanced-scorecard approach at A HCs in relation to two fundamental questions: Does the decentralized nature of most AHCs mitigate the potential usefulness of the balanced-scorecard a pproach? Are the balanced scorecard's four perspectives (learning and growt h, internal; customer; and financial) appropriate for AHCs, which are neith er for-profit nor manufacturing organizations? The authors conclude that (1) the unique characteristics of AHCs ma mitigat e the full benefit of the balanced-scorecard approach,and (2) in cases wher e it is used, some key modifications must be made in the balanced-scorecard approach to account for those unique characteristics. For example, in a co rporation, the key question from the financial perspective is "To succeed f inancially, how should we appear to our stockholders?" But in an AHC, this question must be revised to "What financial condition must we achieve to al low us to accomplish our mission?".