AAOS Bulletin - June, 2005

Developing a compensation report card

How do you weigh the value of teaching, research and service?

By Claude E. Nichols, MD

Developing a report card to acknowledge the contributions of faculty in the three-legged stool of research, service and education is a difficult process. The rationales for developing this sort of reporting structure are to allow internal and external review of funds distribution and to allow informed salary decisions among faculty.

Whatever guidelines and metrics are used must reflect the character of the institution. The system must align faculty incentives with those of the institution. It also must ensure that all significant individual contributions are accounted for accurately and that there is a direct link between academic activities, recognition and reward.

Why bother?

Arguments for developing this type of reporting system are many. First, it provides an objective way to assess each faculty member’s contribution to the strategic goals of the department or institution. This allows for a reviewable, repeatable methodology for salary distribution.

It also advances the strategic goals of the institution by guaranteeing a high degree of faculty buy-in.

It explicitly states the criteria by which each faculty member is evaluated and, in turn, makes the faculty member aware of what is valuable to the institution.

But there are also downsides to this type of assessment methodology. Productivity issues may arise with senior faculty members. The amount of financial reward available to recognize faculty contributions may be disappointing in proportion to the magnitude of the activity. Issues regarding the distinction of merit versus worth—with merit being how well one does one’s work and worth being how important one’s work is to the organization—also may arise. Expectations that the evaluation system will eliminate ambiguity surrounding teaching contributions may undermine the activity because these systems tend to be complex.

Basic elements

To be effective, a faculty evaluation system must include the following elements:

1. It must reflect the values and priorities of the institution.

2. Faculty must be involved in its design and construction.

3. The system must provide for feedback for individual faculty career goals, as well as personnel decisions.

4. Evaluation must be linked to faculty development opportunities.

5. Input must come from a variety of sources.

6. Data must be reliable.

7. Faculty concerns must be identified and addressed.

8. Both formative (career development) and summative (current performance) components of evaluations must be developed and differentiated.

Additionally, the environment must support this type of activity. Characteristics of a supportive culture include:

• Stable, effective, continuous leadership

• Well-managed faculty support

• “Champions” who can weather the initial skepticism

• Periodic reviews of the system to ensure that it continues to evolve and clearly reflects the goals of the department

Examples of evaluation systems

Several types of evaluation systems have been described in the educational literature. The Association of American Medical Colleges’ (AAMC) Mission-based Management Program has proposed a system based on relative value units (RVUs). This group outlined several steps to develop this type of RVU system:

1. Establish a list of faculty activities in education. This could include lecture, laboratory, clinical and nonclinical activities, as well as participation in developing materials, directing or administering education, doing research and writing, etc.

2. Evaluate the quality of teaching and the individual’s specific role. Did the person work alone or as part of a team?

3. Identify the type of educational work. These might range from teaching and administration to developing educational products (courses, teaching materials), publishing and participating in service/outreach programs.

4. Weight the activities (category and programs). How important is the activity to the school’s educational mission?

An advantage to using the RVU system is that faculty effort and contributions are not solely determined by the time expended. Under the AAMC scheme, the number of RVUs credited to a faculty member would be calculated as the product of the activity weight, quality and role adjustment, type of work, and units of activity performed.

An RVU methodology can also be utilized for research activities. These metrics provide important management data and aids in departmental goal setting.

Another methodology is the evaluation system used at the University of Minnesota Department of Family Practice and Community Medicine. This merit-review system evolved through several iterations of historical methods.

Each faculty member gathers supporting materials documenting his or her performance into a portfolio. The areas include: education, research and related activities, patient care, administration, outreach, self-development and citizenship. Faculty members also outline their goals on an annual basis.

A peer-review committee reviews and rates the portfolios and forwards its assessment to the department head, who then meets with each faculty member and establishes the final merit rating for distribution of awards. This process has improved the individual faculty reviews, enhanced the department’s ability to track faculty productivity and increased research productivity.

Another approach to mission-based reporting (not related to the RVU system) is being used by the University of California, Davis School of Medicine (UCDM) to track faculty activity in education, research and service. The UCDM reporting mechanism is used to evaluate departmental strengths and weaknesses as well as to enable department chairs to do career counseling and goal setting. Their experience is that mission-based reporting successfully quantifies individual, departmental and school-wide productivity in education. They acknowledge, however, that mechanisms must be in place to budget and reward faculty efforts.

For more information:

• Nutter DO, Bond JS, Coller BS, et al. Measuring Faculty Effort and Contributions in Medical Education. Acad Med 2000:75;200-207.

• Bland CJ, Wersal L, VanLoy W, Jacott W. Evaluating Faculty Performance: A Systematically Designed and Assessed Approach. Acad Med 2002: 77:15-30.

• Rimar S. Strategic Planning and the Balanced Scorecard for Faculty Practice Plans. Acad Med 2000: 75:1186-1188.

• Howell LP, Hogarth MA, Anders TF. Implementing a Mission-based Reporting System at an Academic Health Center: A Method for Mission Enhancement. Acad Med 2003: 78:645-651.

Claude E. Nichols, MD, is chair of the department of orthopaedics and rehabilitation of the University of Vermont and a member of the AAOS Academic Business and Practice Management Committee. He can be reached at claude.nichols@uvm.edu

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