would unify the organization around a vision
Nemours
From strategy communications to initiative
management to governance, this leading
children’s healthcare institution—established
by the founder of the DuPont chemical empire—
has embraced the discipline of strategy manage-
ment to meet its evolving goals of world-class
care and continued growth.
One of the nation’s largest children’s health
systems, Nemours draws patients from through-
out the world. Through its flagship facility,
the Alfred I. duPont Hospital for Children
(AIDHC) in Wilmington, Del., and 20 clinics
in Delaware, New Jersey, Pennsylvania, and
Florida, Nemours served more than 240,000
children and performed 47,000 surgeries in
2006. Soon to be headquartered in Jacksonville,
Fla., it employs 4,200 people, more than 10% of
them specialty and subspecialty doctors.
Established in 1940 with a bequest from the
estate of Alfred I. duPont, philanthropist and
founder of the DuPont chemicals empire, the
Nemours Foundation began as a charitable
institution that provided care for crippled,
but curable, children and the elderly in
Delaware. The Nemours health system attracted
international orthopedic leaders and forged
a reputation for world-class care. By 1976, its
mission was expanded to include more pediatric
diseases, and its goal reaffirmed: to become
a leader in children’s health. With a more
than $1.6 billion trust, it has grown into a
multifaceted health organization and major
referral center that offers integrated clinical care
Key Results
together with pediatric research, advocacy, and
educational health and prevention services.
One Vision, “One Nemours”
In 2004, plans for a major capital expansion
in Florida forced Nemours executives to rethink
their strategy and management processes,
particularly in the areas of resource allocation
and project prioritization. The organization was
structured by region and health practice, which
generated a culture of competing agendas and
resource demands. Without internal cohesion
and shared strategic goals, leaders knew their
growth plan would likely fail. They realized that
a total transformation was in order, one that
of “One Nemours.” Their objective was to “build
a culture of trust” that would permeate every
aspect of the organization, from overhauling
internal processes so they are based on strategy
planning and execution to achieving the mission.
In 2005, to help carry out its strategic transfor-
mation, Nemours adopted the BSC. However,
leadership changes, including the CEO’s retirement,
soon stalled progress. In the spring of 2006,
incoming CEO and President Dr. David Bailey
(previously the COO) established a new executive
team of 14 top leaders from operational and
support units. With the BSC program as a top
priority, the team rolled out a corporate strategy
map and scorecard. The new strategy articulated
four key goals: (1) “Be a leader in improving
children’s health through our integrated health
system, becoming a preeminent voice for
children”; (2) “Care for each and every child
as if they were our own”; (3) “Be a great place
to work”; and (4) “Be effective stewards of all
of our assets, continually improving them to
advance our mission.” BSC results were first
reported in August 2006, and formal monthly
scorecard meetings (strategy review sessions)
have continued since.
Over the next year—and before cascading
the BSC—the executive team developed a
comprehensive strategy management system
(SMS). This included top-level committees that
form the nerve center of the process, among
them the Strategy Management Governance
Continued on following page
• Total revenues increased 6.4% from June 2006
(pre-BSC) to June 2007 (post-BSC), and the percentage
of receivables paid within four months increased
markedly.
• Nemours achieved a breakthrough increase (10%)
in patient satisfaction, as measured in a formal survey
of all hospital population segments.
• Calls to make doctor appointments rose 30% in the
first half of 2007, the result of training that improved
staff friendliness, efficiency, and effectiveness.
• Nemours achieved a 15% increase in on-time patient
immunizations (in one year) and a 30% reduction in
documentation time, thanks to full implementation
of an electronic medical record (EMR).
• Clinical practices became more standardized, thanks
to BSC-driven improved cross-functional cooperation
and communication.
Team, Annual Calendar Committee, Performance
Management Committee, and Initiative Manage-
ment Committee. A service and operational
excellence initiative, fully integrated into the
SMS, created training seminars to reinforce the
case for change. One result is the Leadership
Development Institute, launched in November
2006, which has thus far provided strategy
training to Nemours’s top 300 executives and
managers.
In late 2006, the team began cascading the
BSC to business and support units. Today,
scorecards are in place for Nemours’s Health
and Prevention division and the Delaware Valley
region (a business unit), as well as for such
functional areas as IS, HR, and Clinical Informatics
(the area comprising clinical software and the
electronic medical records system). Plans for
more than half a dozen others are under way.
Excelling on New Fronts
Besides a sophisticated multimedia campaign
of communications to deliver the “One Nemours”
message, Nemours created an award-winning
intranet, a central information source on the
SMS, with links to management presentations
and BSC reports. Executive team members
oversee communications and serve as strategy
“ambassadors” by lending their voices where
needed—and emphasizing the message within
their areas of responsibility.
Nemours has also overhauled its resource
allocation and initiative management processes.
The annual capital planning software system,
integrated with the BSC, ensures that investments
are prioritized in alignment with enterprise-
level perspectives, objectives, and strategic
initiatives. Proposed investments that don’t align
are discarded.
The BSC framework, along with a new incentive
pay system, has also instilled greater accounta-
Future Focus
bility and a corporate focus in decision makers.
Executives now share financial risk whether or
not a target is within their domain of responsi-
bility. Their compensation is assessed jointly
based on combined year-end performance. As
a result, they view investments holistically, as
an integrated portfolio, not as one-offs. Funding
for ongoing operations is focused on maximizing
consistency across the organization, thereby
creating a “One Nemours” architecture. A deep
Exerpted from BSC Hall of Fame Report 2008 © 2008 by Harvard Business School Publishing
cascade of incentive and performance plan
programs to all associates is scheduled to begin
in 2008.
Early Payoffs
The payoffs have already been impressive. In
its first year of BSC use, Nemours saw a 6.4%
increase in total revenue and a marked increase
in the speed with which receivables were
paid. Patient satisfaction has skyrocketed. In
job recruitment, the BSC has brought needed
process consistency and accelerated the average
time-to-fill. The management of electronic medical
records (EMR) has improved, as the BSC has
helped monitor and report key results; “on-time”
immunization rates, for example, improved
15% in one year. The percentage of surgeries
requiring patients to return to the operating
room unexpectedly—a key metric—dropped
21% in one year.
Nemours’s dream of a multiyear capital expansion
is well on the way to becoming a reality. Its
Five-Year Strategic Plan 2008–2012, modeled
on the strategy map architecture, draws a
blueprint for growth and investment that will
further Nemours’s overarching goal. Indeed,
by helping Nemours demonstrate a clear strategy,
the BSC and strategy map enabled the organiza-
tion to retain its triple-A bond rating. This has
translated into potential savings of millions of
dollars in financing costs through lower borrow-
ing rates—critical to Nemours’s aggressive
growth plans. Says CEO Bailey, “In developing
Nemours strategy, our objective was to create
a credible and relevant direction that is distin-
guished both by its simplicity and its power to
assist leadership in making tough decisions.
Ultimately, success will depend upon our will-
ingness to remain on course, lean and focused,
adjusting our initiatives, but not our aspirations.”
• Deploying more scorecards throughout the
organization’s units and programs.
• Continuing to improve the quality of medical
care and overall patient experience via a long-
term commitment to process and employee-
based initiatives.
• Creating “Nemours One” (the name a play on the
“One Nemours” unifying vision) by integrating the
inpatient and outpatient EMR systems
and Balanced Scorecard Collaborative, and reprinted with permission.