Quantifying the benefits of staff participation in shared governance

manage their practice and work environment
with greater professional autonomy. It is also
an integral component of the professional practice
of nurses in Magnet® organizations. Introduced
more than two decades ago as a model for empowering
nurses, shared governance hinges on various
structures, processes, and outcomes.

  • Structures, in the form of councils and committees, provide forums where nurses participate and engage in work.
  • Processes are the bylaws and policies that define
    how the work and decisions will be made.
  • Outcomes involve such metrics as patient outcomes,
    nurse engagement, and nurse satisfaction.

Accountability and ownership are important principles
of shared governance. Shared governance isn’t
a new concept in health care, but several misconceptions
exist about what it is and isn’t. One misconception
is that it adds expenses to already burdened
healthcare organizations. This article addresses this
misconception by sharing our organization’s experience
as well as several methods to demonstrate the
financial impact of shared governance.

Organizational overview

Children’s Hospital Colorado (CHC) is a 500-bed pediatric
hospital with a main campus in Aurora and 17
additional sites. It has a long history of shared governance.
Staff have participated in unit-based and hospital-
wide committees since the 1980s. However, CHC
had few division-level structures to support decisionmaking
across the nursing division. Creating these
structures was a priority for our new chief nursing
officer (CNO). In 2009, we began to revise the structures
and processes that support shared governance.

Shifting the culture

Developing shared-governance structures at the divisional
level wasn’t as simple as scheduling the time
and finding membership. We had to shift the organizational
culture. Although staff were engaged in
practice and decisions affecting their work, best
practices rarely were shared and aligned across units
and practice areas—mainly because we lacked the
structures for this. So we created new councils and
revised existing ones to meet our needs and provide
links among unit-based structures.

  • The Executive Nursing Council, consisting of
    nursing directors, the CNO, and the associate
    CNO, is strategically focused.
  • The Nursing Operations Council, consisting solely
    of nursing managers and directors, is operationally
    focused.
  • The Advanced Practice Council engages nurse
    practitioners, certified registered nurse anesthe –
    tists, and physician assistants.
  • The Professional Development Council allows clinical
    specialists and nurse educators to align practice
    for staff education, training, and competency.
  • The Innovations and Outcomes Council focuses
    on research, evidence-based practice, and nursing
    quality and safety.
  • The Clinical Partners Council is an interdisciplinary
    venue that includes all clinical departments,
    both within and outside the nursing division.
  • The Clinical Nursing Practice Council (CNPC)
    and Nursing Governance Board (NGB) are described
    in the case studies below.

Of course, developing new councils alone doesn’t
create a culture change. Individuals participating in
councils also must adopt the right attitude and behaviors.
Each council educated its members on the council’s function and
purpose, planning agendas and communicating with
staff. An experienced nurse leader acted as a mentor
for each council. Every council completed a charter to
further define its purpose, essential functions, decisionmaking
authority, membership and co-chair responsibilities,
and communication structures. Bylaws outlined
the overall structure of the entire division.

Case studies

The CNPC is a staff-nurse council with members representing
all areas of the organization, including inpatient
units, ambulatory clinics, procedural areas,
emergency department, urgent care, psychiatry, and
network-of-care sites. Although it existed before 2009,
it was mostly an advisory group that rarely got involved
in decision making. Slowly, through agenda
management and mentoring of staff co-chairs, it has
evolved into a decision-making body. Staff representatives
meet monthly to discuss clinical nursing practice
issues. Co-chairs can allot 8 to 10 hours of administrative
time each month for council activities.


Cost of the CNPC. The council has 56 members;
55% are nonexempt employees. They hold 2-hour
meetings each month at a cost of $32,856 per year.
Co-chairs’ administrative time is $8,000 per year.
This brings the total cost to $40,856 per year.

The NGB formed in 2011 as the central oversight
body over all councils in the nursing division. Initial
membership included chairs of all practice-area
(unit-based) councils. The purpose of such wide
membership was to educate and train council chairs
on their role, effective meeting management, agenda
planning, communication, and conflict resolution.
To promote this training, a retreat was held
and relevant topics were discussed each month during
regularly scheduled NGB meetings. In fall 2012,
after 16 months of start-up, membership was cut to
18 to make the council more focused and efficient.

Cost of the NGB. This council has 49 members;
71% are nonexempt employees. They meet for 2
hours each month at a cost of $33,024 per year.
Co-chair administrative time is $6,144. This brings
the total cost to $39,168.

During our journey to strengthen shared governance,
it became apparent that duplicate work was
occurring due to the large number of committees.
To streamline and steer discussions to the correct
council, CNPC absorbed the work of the laboratory/
nursing committee and safety device committee,
for a cost recovery of $13,804. Work continues on
evaluating all committees and councils to further
streamline and prevent duplication of work.

Tracking performance and outcomes

Three strategies can be used to track expenses and
outcomes related to direct-care staff involvement in
shared governance. (See Tracking shared-governance
expenses and outcomes
by clicking the PDf icon above.)

Return on investment

Cost of the organization’s investment in shared governance
includes salary expenses for the hours that
direct-care providers allocate to shared-governance
work. Gain from the investment might be in the
form of savings related to equipment and supply decisions,
reduced lengths of stay for a certain patient
population, or other quantifiable outcomes. To calculate
return on investment (ROI), use this equation:

ROI = gain from investment minus cost of the investment


cost of investment

Cost avoidance

Cost avoidance refers to actions taken to reduce future
costs. Initially, cost avoidance may incur higher
costs but lead to lower final or lifecycle costs. For
example, staff may be involved in purchasing or
acquiring supplies and materials that in the long
term may yield a reduction in expenses. This approach
doesn’t include the cost of staff time to participate
in decision making. It looks only at the future
impact on expenses.

Cost-benefit analysis

Cost-benefit analysis includes salary expenses
(time) of staff involved. Benefits may include savings
from equipment, materials, and processes that
can be quantified, as with the ROI example. The
equation below shows how cost, benefits, and savings
relate to one another:
Cost – benefits = savings

Examples

As mentioned earlier, CNPC total annual cost is
$40,856. In 2011and 2012, the council collaborated
with the Nursing Operations Council and Executive
Nursing Council to review and change two pay
practices that reduced overall salary expenses by
more than $500,000 annually. These pay practices
were outdated and inconsistently implemented, so
staff and leadership believed they needed to be
eliminated.

A second example involves the Save Our Skin
(SOS) committee, which focuses on increasing
awareness and improving education on skin care,
with the goal of reducing skin breakdown and pressure
injuries in patients. The SOS committee has
representatives from all units; its annual salary expense
was $11,520. During 2011, it decided to purchase
rather than rent specialty beds and mattresses.
Annual rental costs would have been $551,678.
The committee recommended instead that we purchase
a specific number of mattresses and beds;
$250,000 was invested in these resources. Although
we know we’ll have maintenance and labor costs
for these new beds and mattresses, purchasing
rather than renting will yield cost savings of at
least $300,000 per year. The equipment has a 10-year lifespan, so savings will extend beyond the
first year. We believe this was a good investment of
our nursing staff’s committee time.

Shared governance makes good sense

With a little time and partnership with finance department
colleagues, you can evaluate the costs of staff participation in shared governance.

Selected references

Porter-O’Grady T. Is shared governance still relevant? J Nurs Adm.
2001;31(10):468-73.

Scherb CA, Specht JK, Loes JL, Reed D. Decisional involvement: staff
nurse and nurse manager perceptions. West J Nurs Res. 2011;33(2):161-79.

Jeanine M. Rundquist is Director of the Magnet® Program and of Performance,
Practice, and Innovation at Children’s Hospital Colorado in Aurora, and Patricia L.
Givens is associate chief nursing officer.

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