The internal processes and behavioral dynamics of hospital boards: an exploration of differences between high- and low-performing hospitals.

ABSTRACT

BACKGROUND: Nonprofit hospital boards are under increasing pressure to improve financial, clinical, and charitable and community benefit performance. Most research on board effectiveness focuses on variables measuring board structure and attributes associated with competing ideal models of board roles. However, the results do not provide clear evidence that one role is superior to another and suggest that in practice boards pursue hybrid roles. Board dynamics and processes have received less attention from researchers, but emerging theoretical frameworks highlight them as key to effective corporate governance. PURPOSE: We explored differences in board processes and behavioral dynamics between financially high- and low-performing hospitals, with the goal of developing a better understanding of the best board practices in nonprofit hospitals. METHODOLOGY/APPROACH: A comparative case study approach allowed for in-depth, qualitative assessments of how the internal workings of boards differ between low- and high-performing facilities. FINDINGS: Boards of hospitals with strong financial performance exhibited behavioral dynamics and internal processes that differed in important ways from those of hospitals with poor financial performance. PRACTICE IMPLICATIONS Boards need to actively attend to key processes and foster positive group dynamics in decision making to be more effective in governing hospitals.