An Introductory Manual on the Basic Concepts of Risk and Quality

An Introductory Manual on the Basic Concepts of Risk and Quality Management for New Employees in the Health Care Industry



An Introductory Manual on the Basic Concepts of Risk and Quality Management for New Employees in the Health Care Industry


Risk and quality management are essential components of governance in the healthcare sector because of the underlying need to ensure the safety of patients as well as the security of all relevant stakeholders in a healthcare setting. Therefore, it is imperative for all employees to gain a clear understanding of the foundational concepts that underlie these practices. According to Bokar (2007), risk and quality management have traditionally been considered mutually exclusive fields. The reasons for such disparate treatment stem from two primary factors relating to the focus and approaches adopted by the two fields. While quality management focuses on attaining specific objectives, standards or outcomes, the focus of risk management is on possible obstacles that may hinder the attainment of the set objectives (Perkins, 2011). Further, in the event of an error, quality managers institute inquiries in order to devise initiatives for the improvement of the formal processes targeted at the root causes of the mishap (Bokar, 2007). Conversely, risk managers often initiate parallel investigations aimed at protecting information, assess any potential liability that an organization may be exposed to, and to put up measures for the mitigation of any loss that may arise.

However, the contemporary trend in healthcare risk and quality management places primacy on patient safety above and beyond all other considerations. Consequently, as the quality improvement and risk management functions of healthcare providers focus on patient safety strategies, an overlap in the activities of the professionals in both fields becomes inevitable (ECRI, 2009). There is, therefore, an increasing recognition of the fact that quality improvement and risk management are complementary fields that always strive to fulfill the same goal. Perkins (2011) conceptualizes the link between risk and quality management by recognizing that whenever there are objective gaps in quality improvement processes, these gaps imply more variances in the process which often translates into higher risks. Thus, reducing the risk of variances directly results in a reduction of the objective gaps and thereby increasing the quality of the process. The existence of this nexus tenders ample justification for the formulation and implementation of the integrated risk and quality management framework that this manual advances. Efficient risk management underlies successful quality management and improvement activities and can lead to positive outcomes in healthcare delivery.

Concepts of Quality Improvement in the Healthcare Industry

Quality management entails harmonized activities that direct and organize a healthcare provider with regard to quality improvement. Quality management, therefore, is the systematic and constant development of the processes and structures that healthcare providers employ in the delivery of services that ought to satisfy and even exceed consumer expectations (Sollecito & Johnson, 2013). Effective quality management strategies are based on three fundamental tenets: quality control, progress and development. Shaw and the ISQua Toolkit Working Group (2004) define quality improvement as a continuous reaction to data on healthcare quality assessment in a manner that improves the processes through which patients receive healthcare services. According to Moss (1995), a defining characteristic of quality improvement is that it is basically an internal apparatus which is reflective rather than defensive or punitive. Further, it depends on learning and improving hence is based on concrete evidence and a good understanding of the needs of the patient.

The Health Resources and Services Administration (HRSA) assert that successful quality improvement strategies must incorporate four fundamental key principles (2011). These are a recognition that quality improvement functions as systems and processes, maintaining focus on patients, maintaining focus on working as a team, and maintaining focus on the use of data. The system and processes principle holds that for successful improvements, it is important for stakeholders to understand all systems and processes that underlie the organization. According to the HRSA (2011), processes in an organization are comprised of the activities that are undertaken by an organization and the manner in which these activities are done. It is crucial to understand all these processes because effective quality improvement strategies demand that they are planned and systematic and applied throughout the whole organization (EQuIPNational Resource, 2013). Therefore, gaining adequate comprehension of the organization and functioning of a healthcare provider is a fundamental principle of effective quality improvement.

The focus on patients’ principles recognizes that the extent to which the needs and expectations of the patients are met is an important indicator of the quality of healthcare services. Consequently, the principle demands that the services are dispensed in a way that enhances a patient’s access, offer care based on concrete evidence, ensures patient safety, facilitates and encourages patient participation, a coordinated approach that integrates other parts of the larger healthcare system, and offering culturally competent services (Health Resources and Services Administration, 2011). This principle is reflective of the contemporary trends in risk and quality management that place emphasis on patient safety thereby occasioning the recognition of the complementary nature of these fields that necessitates their integration.

The third principle posits that effective quality improvement demands team effort. For quality improvement processes to be successful, they have to be conducted with organized teamwork that is characterized by effective communication between the relevant players (EQuIPNational Resource, 2013). Teamwork is of crucial importance because it enables the organization to take advantage of the divergent knowledge, experience, skills, and perspectives brought about by the different individuals that make up the team. Every individual in a team bears a responsibility to be actively involved and to add value to achieving positive outcomes. In addition to effective teamwork, the third principles also places insistence on the presence of adequate structures such as policies, procedures and leadership that assist in the organization and facilitation of the work conducted by the team. Adequate infrastructure ensures that the time has the necessary resources and tools for the attainment of their objectives. The fourth principle on the use of data emphasizes the primacy of data in quality improvement and that reliable evidence and accurate analysis of data contribute to successful outcomes. Data enables an organization to evaluate its current performance, identify possible opportunities for improvement as well as monitor the improvement of its performance over time.

Concepts of Risk Management in the Healthcare Industry

Risk denotes the consequence of ambiguity of objectives that arises whenever there is a complete or partial deficiency in information required to gain an adequate understanding of the likelihood and consequence of an event. It necessarily follows that risk management refers to the organized actions that aim at directing and controlling an organization in relation to potential risks in its field of operation. Risk management is a process through which decisions that assist in the prevention of undesirable occurrences and the minimization of the effects of those events are made and implemented. According to Moss (1995), therefore, risk management is concerned with minimizing the chances of errors occurring in the healthcare provision services in order to minimize any inconveniences to the patients and to limit pecuniary loss to an organization. These objectives are attained through monitoring, detection, reporting and rectifying actual or potential deficiencies. Effective risk management often leads to quality improvement.

Risks in the healthcare sector may take one or more of varying dimensions. A healthcare provider may be vulnerable to political, operational, legal, financial or clinical risks. Therefore, it becomes imperative to manage all activities that involve an amount of risk. According to the Nurses service Organization (2006), an effective starting point in the reduction of risk requires a formal, concisely expressed risk management plan that articulates the organization’s risk mitigation policy. This document forms the basis for employees’ education on the organization’s objectives and their responsibilities in that regard, and the requisite course of action to be followed in the event an error occurs. Thus, employees must become pricy to and ensure that they understand this policy. Further, risk management demands for risk assessment, identification, analysis, evaluation and treatment strategies that are buttressed by effective communication and consultation mechanisms.

Analysis of Important Information for Decision-Making Processes in Risk and Quality Management in the Healthcare Industry

There is an array of important information that is required for the decision-making processes in healthcare risk and quality management. First, depending on the size and services that an organization provides, it is important to have a thorough appraisal of the possible risks that are associated with the concerned activities. Therefore, decision-makers must establish the dimensions of risk, whether clinical, legal, operational or political that may make their organization vulnerable as well as all alternative and mitigating measures that are open to them. Information that is important to the making of decisions relating to quality and risk management includes an appraisal of the needs of the consumers as well as their levels of satisfaction with regard to services offered by the organization. Further, there must be concerted efforts in gathering and analyzing data and information that is reflective of the organization’s performance. Customer concerns also present useful insights into the performance, strengths, and deficiencies of an organization hence comprise important information that may aid in decision-making. Information concerning the satisfaction of employees also forms a crucial part of the information cache that is needed. Therefore, employees are always encouraged to express their opinions with regard to all organizational practices that have a bearing on quality and risk assessment and management.

Challenges in Making Risk and Quality Management Decisions in the Healthcare Industry

There are numerous challenges that players in healthcare encounter in making decisions that relate to risk and quality management. One common challenge often arises where a healthcare practitioner harbors doubts in relation to a situation that is before them. For example, a physician may be doubtful of a patient’s capacity to come to an informed choice regarding certain medical procedures. Such instances often involve a potential violation of the law or ethical requirements and may expose the physician as well as the organization to legal risks. Another similarly related challenge may arise in situations where a patient refuses to give consent for much needed medical treatment or withdraws consent in the course of receiving such treatment. Another challenge in making decisions that concern risk and quality management may arise in emergency situations where the affected patient lacks the ability to make certain critical decisions. (Kaplan et al. (2010) suggest that the best way to overcome these challenges involves seeking a second opinion from a colleague who is familiar with similar situations. Another way of surmounting these challenges is by reporting to the organization’s risk and quality

Risk or Quality Management Tool Purpose Advantages Disadvantages
Brainstorming Eliciting information and ideas from people Harnesses the power of the masses to elicit diverse perspectives Relies on individual’s knowledge and willingness to engage in the discourse
Cause and Effect (Fishbone) Analysis Identify, explore and graphically express all possible causes related to a problem in an attempt to discover the underlying cause Involves a thorough analysis thereby increasing the chances of discovering the cause of problems. Narrowing down to a comprehensive list is time and human resource intensive due to brainstorming
Failure Mode Effects Analysis (FMEA) Evaluating processes to identify its deficiencies, how it may fail, the effect of such failure and parts that need improvement Caters to the most vulnerable factors that may result in the processes’ failure It requires input from an entire team hence not practicable where some team members are unavailable
Pareto Chart Relies on the Pareto principle to seek out the 20% causes of organizational problems Narrows down to the vital causes of a problem The narrow perspective may exclude other important causes that may not be frequent but still significant

management department and asking for further directions on resolving the issue.

Risk and Quality Management Tools Matrix


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EQuIPNational Resource,. (2013). Risk Management and Quality Improvement Handbook (3rd ed.). Sydney: The Australian Council on Healthcare Standards (ACHS).

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Kaplan, H., Brady, P., Dritz, M., Hooper, D., Linam, W., Froehle, C., & Margolis, P. (2010). The Influence of Context on Quality Improvement Success in Healthcare: A Systematic Review of the Literature. The Milbank Quaterly88(4), 500-559.

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