Getting “Change” Rolling depends on Roles on the Team

It is suggested on leanblog.orgthat now’s a good time for starting a new business — many successful companies were started in recessions: Microsoft and Disney as two examples.

I would suggest it is also a good time for existing hospitals to consider changes that can make them into better hospitals. Bad economic times practically force change upon us. The immediate change many CEOs make is staff reduction and that might well be necessary. But stopping with staff cutbacks is only half the solution. The other half is looking closely at total hospital operations.

Based on your hospital’s vision and business strategy for differentiating your hospital from competitors, what changes can you make to bring vitality back to the organization?

When starting a new business, the author of leanblog.org suggests getting the right people on the team is the most critical element:

“It is very likely that you’ll need 3-4 key team members, your co-founders, to help you get this thing off the ground. Each will bring his or her specialty to the venture: a boss (CEO); an idea guy (R&D, technology); a bean-counter/administrator (CFO or controller); and a chief sales rep (VP/Director Sales/Marketing). If you get the right people in place things like “who is our customer, what are we going to sell them, and how will we make it” have a way of getting figured out. That’s what talented people do.”

The same is true of hospitals. Significant, deep and meaningful change is one of the hardest tasks that hospital leaders face. There is tremendous cultural drag. There are conflicting motivations to deal with. So getting the right people on the team to lead change is your most important decision. The second is dealing with those you know from the start are going to fight change to the death. You have to win these recalcitrants over before you get too far or they will submerge the best intended of plans. They need to see the personal value of change and how they will benefit. If they don’t go along, then their tenure may be questionable. The last thing you need is a mole undermining every advance your “change team” puts forth.

Because change during a recession is stimulated by revenue / profit concerns, part of the change must be aimed at improving productivity — the positive side of eliminating waste. We know from experience that when we are brought in on as part of the “change team” we have been able to put 3 to 5% on the bottom line while strengthening the hospital’s ability to deliver its vision and business strategy.

For a hospital in Texas, we were able to identify $23 million in savings opportunities during the 14-month target-setting process and $8 million was achieved upon completion of the assignment. But this kind of performance improvement is not possible unless the CEO assembles the right internal team to look freshly at the situation and have the courage of conviction to move forward.

Filed Under: Hospital Leadership