Developing a risk management strategy
In today’s ever-changing healthcare environment, the most successful healthcare organizations are adopting Enterprise Risk Management (ERM). In a traditional risk management model, incidents are dealt with on a case-by-case basis by individual departments. However, in organizations practicing ERM, departments share responsibility for managing risk and recognize that every incident can reveal opportunities to strengthen overall operations. Here are four steps to get you started.
1. Set meaningful goals and attainable objectives
ERM is not for healthcare giants only. In fact, an effective ERM program can be designed to be as basic or complex as necessary, based on the structure and culture of the organization. Regardless of how it is implemented, the basic goal of ERM remains the same: to help identify and leverage risks as opportunities to improve organizational effectiveness.
And while ERM programs are scalable, the concept is indisputable: any improvement is better than no improvement. For example, the healthcare organization that has 10 employees, and not 10 thousand, may have an objective for its ERM program to focus on the 10 most common areas of risk. These can be broken down any way that suits the organization; for example, by department, procedure, or diagnosis.
At the same time, because ERM programs are scalable, so are the results. This means larger, more complex organizations looking at their 10 most common risks can expect to produce results that are proportionately meaningful and impactful.
2. Create a governance structure that works for your organization
The size of an organization is also reflected in its governance structure — from a sole proprietorship to a large board of directors — implementing an ERM program can involve a few key department managers, or several committees and dozens of employees. In every case, ERM reflects a frame of mind — a commitment to look at risk management as a forward-looking approach to improve organizational performance.
All healthcare organizations implementing ERM will likely share some risk assessment methodologies. This may include incident reports, claims studies, and regulatory surveys; and, whenever possible, some combination of all three. Here again, the amount and complexity of data to be collected and analyzed is scalable based on the size and resources of the organization.
Detailed risk assessment will help identify patterns — who is doing what, with whom, when and where — which, in turn, will reveal possible solutions to help mitigate risks. This may range from the installation of automatic lights, more convenient placement of commonly used items, a change in housekeeping practices or schedules, a more robust process for administering medications, or the purchase of a piece of equipment that enhances safety for both patients and staff.
3. Educating and empowering employees
Communications are vitally important to successfully launch and sustain an effective ERM program over the long term. An ERM communications plan should reach employees at every level of the organization, stressing the interdependence of various roles, functions and departments in the ERM process. Communications should explain ERM in simple terms, demonstrating how a single negative, risk-related incident can affect almost any area of operations.
And — more importantly — communications should encourage and empower every staff member, regardless of their job, to help deliver positive results through ERM, by coming forward to identify risks where they are found and by proposing solutions they think may work.
4. Ongoing monitoring and improvement
Organizations are naturally resistant to change, because change is inherently stressful. However, healthcare organizations that take a “that’s the way we’ve always done it” approach to risk management are, in fact, setting themselves up for even more stress by repeating negative, risk-related incidents.
At the same time, for organizations that adopt ERM, continuing to monitor and assess results enables the program to be as effective as possible. Fine-tuning after implementation will also help create and nurture a shared sense of mission and responsibility among all employees, which, in turn, helps to strengthen the overall fabric of the organization and encourage continuingly improving results.