Quality Management Theories and the Healthcare Practice

There are a number of management ideas and theories that offer ways to improve quality. However, to investigate your practice processes and put new ones in place, you must have a culture of understanding and truth.


There are a number of management ideas and theories that offer ways to improve quality.

These include:

Management by Objectives (MBO)

Key leaders in the development of MBO in the 1950s include Peter Drucker and George Odiorne, who defined it as when “the superior and subordinate managers of an organization jointly define its common goals, define each individual’s major areas of responsibility in terms of the results expected of him and use these measures as guides for operating the unit and assessing the contribution of each of its members.” MBO uses objectives, action plans, participation in setting objectives, and implementation of the plan.


Lean Management is “thinking” about how you can become more efficient by eliminating waste and adding value to the customer (patient, fellow employee, referring provider), focusing on the long run by addressing small parts of the process and continuously improving the process to achieve, “perfection.” You must have a culture of understanding and truth.

Total Quality Management (TQM)

TQM “is the integration of all functions and processes within an organization in order to achieve continuous improvement of the quality of goods and services. The goal is customer satisfaction.” This concept deals with job design, productivity, and improvement in work methods to find the best way to accomplish the task. TQM also looks at the cost of quality, changing the culture to meet customer needs, focusing on education and training, defining mission, processes, and encouraging effective communication between all involved.

Zero Defects

This is an idea developed in the 1970s that embodies a philosophy that “quality is free” and that there should be zero defects. This idea was promoted in Quality is Free, by Philip Crosby, published in 1979. He includes such steps as training, commitment, teamwork, awareness, goal setting, and removing the causes of errors.

Baldrige Award

Named after the late U.S. Secretary of Commerce Malcolm Baldrige, this award was created by Congress in 1987. It sets national standards for quality and hundreds of major corporations use the criteria in its application form as a basic management guide for quality improvement programs.

It highlights process management, human resources, planning, customer focus and satisfaction, leadership, and quality and operational results. In the healthcare arena, there are many accreditation agencies that use criteria similar to the ideas behind the Baldrige Award. These include the Joint Commission on Accreditation of Healthcare Organizations (JCAHO) and the Accreditation Association for Ambulatory Health Care, Inc. (AAAHC). There is also the National Council on Quality Assurance (NCQA), which provides standards for insurance carriers and now offers options for accreditation to medical practices as well.

Six Sigma

“A statistical concept that measures a process in terms of defects—at the six sigma level, there are only 3.4 defects per million opportunities. Six Sigma is also a philosophy of managing that focuses on eliminating defects through practices that emphasize understanding, measuring, and improving processes.” This highly successful approach has been used in such major firms as General Electric and Motorola. Several hospitals have successfully applied the principles of Six Sigma as well. In all of these quality concepts and approaches there are key characteristics that you can take away and use to develop a program that best fits your practice.

The key points are:

  1. Set goals.

  2. Plan, plan, plan.

  3. Leadership must buy into the program to make it successful.

  4. Customer service is the cornerstone.

  5. The entire process must be reviewed to seek true improvement.

  6. Employee involvement and participation is critical.

  7. A team approach makes for success.

  8. Training of those involved is essential.

  9. Recognize the need to improve by removing defects, meeting customer needs, and reducing costs.

  10. And recognize that you can continually improve and that any remedial program is not a one-time thing.

What can you do to implement a quality-management program in your practice?

In your practice of medicine problem-solving is critical. This concept applies to managing a process as well. Here are the basic steps in process management:

  1. Identify the problem and write a problem statement.

  2. Identify and consider the alternatives available to solve the problem.

  3. Choose the best solution.

  4. Implement the solution.

  5. Monitor the new process to insure that it is solving the problem.

  6. If it isn’t, go back to #2 and consider another alternative, or modify the process to better meet the desired outcome.

All the methods described are models that your healthcare practice can follow either fully or with slight variations. However, to investigate your practice processes and put new ones in place, you must have a culture of understanding and truth.




20220420 c1_Think_Business_2nd_ed_r1
Excerpted from
Think Business! Medical Practice Quality, Efficiency, Profits, 2nd Edition by Owen J. Dahl, MBA, FACHE, CHBC.




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