Published on : May 06, 2011

Tracking Sustainability: Metrics Critical for Higher Performing Organizations

Tracking Sustainability: Metrics Critical for Higher Performing Organizations

Are you challenged to lead your hospital to develop a “culture of sustainability”?

Does your organization already feel overburdened by administrative duties which don’t seem to directly impact the bottom line?  Well, you’re not alone.  As the sustainability movement in healthcare continues to grow and more organizations are looking for performance benchmarks, they are left empty handed. Certainly the healthcare industry provides benchmarks touting diseases, length of stay and others.  But, when it comes to sustainability little is available.  Today, however, managing the internal data that you have and organizing that data in a format that yields information, is essential.  Although cliché, “You are what you measure” and “What gets measured gets managed” excelling in measurement of certain key metrics not only cuts energy costs but separates higher performing organizations as they grow their sustainability programs. There are sustainability metrics tracking tools which help lighten your administrative load, converting cumbersome spreadsheets to automated, web-based software which includes communication tools designed to effectively share data throughout the organization.

 “Sustainability Metrics are tools that measure the benefits achieved through the implementation of sustainability” according to the Center for Sustainability at Aquinas College, in Grand Rapids Michigan.  Sustainability metrics tracking can tell you what you should do and as a result you will be measuring your successes, including energy and cost savings.

 

Hospitals are Utilizing the Software

Hospitals pay their electricity, natural gas, water and waste bills just like we do at our homes…they simply write the check.  The central accounting department pays the bill, but do they track or measure Kwh?  There is minimal or no reviews of the bill.  Therefore, hospitals are putting their faith and trust in the utility vendor to report and invoice correctly.

If your hospital is currently focused on either energy or waste, that is a good first step, but as any energy or environmental manager will tell you, there is a lot of data that must be analyzed. Most hospital systems have hundreds of locations that are typically conducting a manual review of the bills.  The better performing organizations have complex spreadsheets to identify trends or anomalies.   This is a challenging approach not only because of the evolving complexity, but also because of the various invoicing schedules.  Most of the energy and water bills are invoiced on a monthly or quarterly basis, but the various waste streams (Solid Waste, Recycling, Regulated Medical, Hazardous, Pharmaceutical, etc.) are invoiced very differently.  There are even waste programs, such as donations, that if included, provide a more accurate sustainability picture.  It is therefore critical that the data is analyzed accurately and consistently or the data will not result in useful information, assisting you in making wise business decisions leading to energy and cost savings.   It will simply be a mass of data collected.  Sophisticated systems such as Spectrum Health System, a leading health system in West Michigan, are taking a cutting edge approach and have utilized advanced software.  For an organization like Spectrum Health System, with nine hospitals, over 100 off-site facilities and 16,000 employees, gathering the right data to provide useful information can be an immense undertaking.  However, Spectrum Health has specific sustainability goals and automation is helping them to efficiently achieve their goals. 

Metro Health is another success story where sustainability metrics tracking has helped the hospital achieve its cost savings and energy management goals.  Alison Waske, Sustainable Business Officer with Metro Health says, “We needed a robust tracking system to quantify how much waste there is and how much it is costing.  The financial part of sustainability is extremely important.” Waske states that benchmarking and identifying metrics that work for a given business are the key to tracking performance. 

Carroll Hospital Center in central Maryland has a progressive sustainability program and uses sustainability metrics to track their performance.  Robert White, Assistant Vice President of Professional and Support Services, says “the dashboard provides the latest information for facility management and the in-depth reporting provides the information we need on key usage and performance metrics.  We want to continue to enhance the facility performance and provide our patients with a green and efficient facility.”

 

How it Works

These sophisticated health systems have successful sustainability programs because they not only collect invoice data (usage and costs) on energy, water and waste, but also collect and analyze the facilities’ many performance indicators such as square footage, patient days, adjusted patient days, discharges, licensed beds, occupied beds, and FTE’s.  Both data collections are essential in order to provide the health system with the complete picture which will more effectively assist in hospital’s business decisions. This information provides hospitals with benchmarking data.  The question, “How are we doing compared to others?” is finally answered.

There are many tangible and intangible cost savings opportunities when utility data and metric data are correctly measured and managed.  One hospital identified a $600,000 pricing error due to an erroneous electric meter setting.  Another hospital identified lower utility rates by comparing facilities rate programs within the system.  Most energy companies offer electronic invoicing.  The electronic invoice is automatically loaded into the software when the invoice is ready from the vendor.  By processing the vendor’s electronic invoice detail directly into the software, this reduces the errors and costs associated with manual keying of data.

 

Sharing the Information

One of the biggest challenges hospitals face is encouraging a “bottom up” or grass roots system wide campaign around sustainability.  One of the many reasons is that the “sustainability leader(s)” do not have effective communication tools such as dashboards and sustainability scorecards where they can share the information throughout the organization.  Additionally, if the scorecards are integrated with a project management tracking system, real time reporting is established and best practices can be shared. 

 

Goal Setting

It is almost inevitable that expectations and requirements for disclosure around sustainability for hospitals will increase.  Therefore, setting measurable and attainable sustainability goals is essential.  When vendor data and metric data tracking is a priority, a hospital can effectively set the goals around the evaluation of energy, GHG emissions, solid waste and water use, to name a few.  At the next level, some hospitals are evaluating each indicator on a relative basis, like assessing the GHG emissions per unit of product, or water used in a specific process.  This level of granularity is critical to understand where areas of opportunity may be and measuring the performance of specific initiatives.   Leading hospitals are using this type of thinking to understand where the greatest opportunities and potential risks exist in their operations.

In today’s health care industry, success depends on having the correct set of metrics in place to measure progress in meeting short and long-term objectives.  Measuring progress with a sustainability lens is just one of the new responsibilities that hospitals need to embrace.

 

Jeff Burks is the Relationship Manager for Key Green Solutions. He has consulted for many organizations on implementing software solutions for their sustainability programs. Key Green Solutions offers its software suite to hospitals, shared hospital laundry facilities and insurance companies to improve the efficiency and reduce the operating costs. He may be reached at jburks@keygreensolutions.com.
Key Green Solutions web site can be found at www.keygreensolutions.com.