BUSINESS PROCESS REENGINEERING AND ACCOUNTING MANAGEMENT PRACTICES OF INDONESIAN PUBLIC HOSPITAL: THE UPPER-ECHELON PERSPECTIVE
Made Aristia Prayudi, I Gede Agus Pertama Yudantara, Lucy Sri Musmini, & I Putu Gede Diatmika

Universitas Pendidikan Ganesha

Abstract

Purposes: This study investigates how Indonesian public hospital top management teams (TMT) decide on business process reengineering (BPR) implementation and performance measurement systems (PMS) design as a part of their management accounting practices. It addresses gaps in understanding the impact of TMT characteristics on PMS design diversity in supporting BPR implementation and explores the dynamic nature of regional public hospitals, emphasizing the need for effective decision-making processes to optimize healthcare service delivery amidst institutional changes.
Methods: This qualitative study conducted semi-structured interviews with 13 TMT members from four hospitals in Indonesia, supported by document analysis.
Results: The study found that successful BPR interventions include service integration, staff role changes, and process streamlining, enhancing efficiency and patient care. Furthermore, TMT members prioritize financial and non-financial measures differently, leading to tensions in PMS designation, reflecting the struggle between cost-cutting and quality care. Additionally, directors with medical backgrounds play a crucial role in balancing healthcare priorities.
Conclusion and suggestion: This study underscores the importance of socio-demographic characteristics, particularly educational background, in shaping strategic decision-making within top management teams.

Keywords: business process reengineering- performance measurement systems design- public hospital- the upper-echelon perspective- management accounting

Topic: Public sector accounting