Inefficiency in the work of health care providers is evident and contributes to health care costs. In the early 20th century, industrial engineers developed scientific methods for studying work to improve performance (efficiency) by measuring results--i.e., quality, cost, and productivity. In the mid-20th century, business managers developed ways to apply these methods to improve the work process. These scientific methods and management approaches can be applied to improving medical work. Fee-for-service practice has had incentives to maximize productivity, and prepaid practice has had incentives to minimize costs, but no sector of the health care system has systematically pursued the optimization of all performance variables: quality, cost, and productivity. We have reviewed evolving methods for the automation of continual assessment of performance in health care using touch screen and computer telephone, logging and scheduling software, appropriate combinations of generic or disease-specific health status questionnaires, physiologic measurements or laboratory assays from computerized records, and cost and productivity data from computerized registration logs. We propose that the results of outcome assessment be rapidly and continually transmitted to providers, patients, and managers so that health care processes can be progressively improved. The evolving systems we have described are the practical tools that can help us achieve our performance goals.