On The True Measure of Success


Posted by Tony Kovner

I recently read a great article in Harvard Business Review which proposed four steps in measuring success in the organization you work for.  (To my knowledge, it is uncommon for many organizations, including health care organizations and schools of public administration, to follow these steps as part of standard practice):

- Define your governing objective.

- Develop a theory of cause and effect to assess presumed drivers of the objective. (the step that’s usually left out)

- Identify the specific activities to help achieve the governing objective.

- Evaluate your statistics (reevaluate the measures you are using to link employee activities with the governing objective (also lacking in practice).

I’m interested in learning more about organizations that carry out these steps well.  Please share your thoughts.

Suggested reading: “The True Measure of Success” HBR by Michael J Maubossin, Harvard Business Review, October 2012 page 48.


The Role of Mergers and Aquisitions in the Not-For-Profit Healthcare Sector: Part II


Posted By Joel Wittman

Part II: Part II – What to consider when a not-for-profit is the acquirer

In last month’s post, I wrote about the considerations to take into account when evaluating the sale of a not-for-profit health care entity.  In this month’s article, I will look at the issues to consider when a non-profit is the acquirer.

Since Congress enacted health reform legislation in 2010, there has been a marked increase in mergers and acquisitions in the healthcare space. Although for-profit organizations drove the bulk of the nearly 1,000 transactions taking place in 2011, a growing number of nonprofits have begun to see mergers and acquisitions as part of a larger strategy to effectively navigate the reformed healthcare marketplace. This reflects the increasing role that nonprofit organizations play in the delivery and financing of healthcare in the US – according to an estimate by a nonprofit healthcare trade group, about 60 percent of community hospitals are nonprofit, roughly one-third of nursing homes are nonprofit, and almost 20 percent of home health agencies are nonprofit. Further, over 40 percent of all private health insurance enrollees receive services from a nonprofit health plan.

Nonprofit healthcare organizations consider mergers and acquisitions for the same reasons for-profit entities do. They seek to improve quality or efficiency; they desire increased access to capital, enhanced capital base or expansion of cash flow; they want to expand service lines, enhance product offerings or target other geographic areas; or they seek to gain specific types of talent or other assets. But unlike the for-profit environment, nonprofit organizations have other specific issues to consider as they plot a merger or an acquisition strategy. It is recommended that a nonprofit organization’s board and management perform a detailed strategic analysis before executing an M&A strategy.  The following four considerations are a solid start.
Fit. The idea of considering organizational fit when thinking about pursuing a merger or an acquisition with another company seems simple, but it can be a rather complicated matter. Although for-profit companies also consider whether a potential buyer or acquisition fits strategically or organizationally, nonprofit organizations have their mission to the communities they serve to consider beyond these primary issues when it comes to fit. Unlike for-profit companies, nonprofit healthcare organizations exist within a framework of mission-based operations, and the mission colors everything from operational strategy to daily execution. The leadership of every nonprofit organization considering an M&A strategy needs to be clear about its mission, how open to change that mission might be, how an M&A strategy will affect that mission, and what limitations – or opportunities – that mission offers. And if acquiring another non-profit, boards must think about how changing the target’s mission affects perception or buy-in among the target’s patients, providers, staff or payers.

Financial impact. Nonprofit board members and staff management need to think carefully about the financial implications of the potential transaction. Naturally, a common part of the M&A process is to weigh the financial advantages and disadvantages of the transaction, as well as to evaluate an organization’s financials and assess its real value. Part of the discussion is whether an acquisition is best the use of funds to further the organization’s mission.  In today’s environment, many providers are leveraging their healthy balance sheets to reach a level of scale that can offset future reimbursement cuts.  This may be an appropriate strategy, but an organization that may not have internal acquisition and integration experts must evaluate if the use of funds for an acquisition is priced appropriately considering the internal and external integration risk.  Nonprofits also need to consider additional layers of financial impact; any partners advising a nonprofit about a transaction need to be well-versed in these layers. Special tax situations must be considered, as well as the value and disposition of certain types of charitable assets.
Process. There is a logical process to every transaction – but nonprofit organizations have additional steps to follow and angles to consider. The additional steps can extend the acquisition timeline and put the nonprofit buyer at a disadvantage when they are competing for a target.  An experienced advisor can help a nonprofit board and leadership prepare and execute the specific processes that need to happen and minimize the potential disadvantages. All nonprofit M&A transactions will naturally need to involve a realistic valuation of the transaction, a substantive due diligence process, evaluation of legal and antitrust issues and a detailed analysis of financial impact. The legal and financial implications of a nonprofit transaction differ from those of a for-profit transaction, so any strategic process should accommodate not only specific evaluation and analysis of these implications, but appropriate planning to execute them.

Access. Probably the biggest difference between a for-profit entity considering a merger or an acquisition and a nonprofit entity is that in the nonprofit world, there are relatively few knowledgeable financial and strategic advisors who understand the nonprofit environment, and of these, even fewer have significant access and deep relationships across the industry. As your organization considers an M&A strategy, ask yourself whether you have the right access – not just to sources of capital, but also to potential buyers or acquisition targets. Do you know how to source and evaluate potential targets? Do you how to begin a conversation with a target? Finding the right partner with the right access and market credibility is critical to the success of your M&A strategy.

Last month’s and this month’s postings provided the reader with some thoughts about both the sell and buy sides of mergers and acquisitions in the non-profit health care community.  So, for all of you not-for-profit health care organizations out there, are you a seller or, perhaps, a buyer?  Either consideration will require a thoughtful and careful approach.   Please let me know what you decide to do.

Joel Wittman is an Adjunct Associate Professor at the Wagner School of Public service of New York University.  He is the proprietor of both Health Care Mergers and Acquisitions and The Wittman Group, two organizations that provide management advisory services to companies in the post-acute health care industry.  He can be reached at joel.wittman@verizon.net.


Sticky Notes & Pairs: Dial Up Staff Collaboration and Improved Solutions in your Performance Improvement Work!


Posted by Paloma Medina

Situation: You have an organizational issue that would benefit from the use a team approach. Perhaps you need to update a work flow or improve organizational performance on a specific measure. However, during staff meetings you find that engagement is low, brainstorming lacks innovation, specific people dominate the meeting, and/or inter-departmental tensions impede collaboration.

Solution: Change your meeting structure! The following “Meeting Recipe” will dial up staff energy and lead to better performance improvement solutions!

What you’ll need:

Meeting time of 1 – 2 hours (epending on the depth of the problem or area you’re focusing on)

20 or more sticky notes and one pen per attendee

Dry erase board or flip charts

A volunteer to act as a high-energy facilitator & time keeper

Instructions:

  1. Assign attendees into random or strategic pairs
    Have them sit together in their pairs
    I highly recommend being strategic — think about how pairs might increase collaboration among departments or individuals. You could pair up nurses with providers, administrators with front-line workers, etc.
  2. Pass out sticky notes and pens to each attendee
  3. State the challenge and the goal. Be clear and concise
    For example, “We want to increase provider productivity by 20% in three months” or “We want to improve our patient check-in process to decrease patient and staff stress”
  4. Give individuals 5 minutes to brainstorm on their own ideas for how this could be done
    Rules:
    1. One idea per sticky note
    2. Each attendee must write down  4 – 10 ideas (yes – this is doable!)
    3. At least one idea must be crazy, really fun, or pie-in-the-sky big (I often award candy to craziest ideas — this greatly energizes and revs up divergent thinking)
  5. Have individuals now share ideas in their pairs
    Give them 2-3 minutes per person to share their ideas, call “time” when it’s time to switch and have the other person share
  6. Have pairs generate ideas
    Give them 10 minutes to come up with 10 more ideas with their partners. Ideas can be  completely new or building on each others. Again, one idea per sticky, at least 2 new crazy ideas.
  7. Call everyone back together and round-robin to report back ideas
    Rules:
    1. Have pairs come up and post their sticky notes as they explain their idea onto the dry erase board or flip charts
    2. Hold off on judgement – responses to ideas can only be praise or clarification questions
    3. Limit reporting to 60 seconds per idea – make it a fun but strict cut-off to assure pairs report concisely and energy stays high in the room
    4. If an idea was already presented, just have pairs say “ditto on ___ idea” rather than repeat it
    5. Spread out the area where you’re posting the stickies, the more spread out, the better
    6. Anyone at any point can “build” on an idea that is being presented and write down a new sticky note for it
  8. Everyone vote for their 5 favorite ideas
    Have everyone walk up at once and move around to review the ideas, then “vote” by marking the chosen sticky notes with a star. Give this just 5 minutes for this to assure people move fast and energy doesn’t drop – you’re almost there!
  9. Now re-vote to narrow it down
    Take down all but the top 10  voted-on ideas. Have everyone vote again but this time everyone gets one vote – this will lead you to your top 2-3 ideas to test out.
  10. Decide on next steps
    As a group decide what are the next steps to test out the chosen ideas, include time frames. Have pairs volunteer to take on the tasks. Pairs can them meet outside the meeting to plan how they’ll carry out their tasks. Have everyone report back in a meeting within a week.

After the meeting: Have someone transcribe all the ideas and note which were the highest rated. Refer back to these when you’re ready to try out a new test.

Real-life example:

A New York community health center faced this exact challenge — front-line staff were tasked with improving their productivity numbers but felt frustrated by leadership’s lack of support for their ideas. Months of meetings went by with little improvement in the situation and their numbers remained low.  The front-line workers requested to have a potluck lunch meeting with leadership to re-energize the group and used this “recipe”. They paired up management team members with frontline staff members to break down hierarchy walls. After the meeting both leadership and front line workers reported loving the voting structure and noted the high energy among everyone- a significant change from prior meetings! They now plan on using “pairs” for all of their performance improvement work.

Paloma Medina is an MPA HPAM 2012 candidate with a specialization in organizational coaching and development. Her background is in homeless health care, community development and design. In her spare time Paloma can be found tailoring her clothing, re-organizing her craft supplies or coming up with new toppings for hot dogs.


Let’s Meet to Meet


Posted by Jacob Victory

The routine is the same every morning. I enter my office. I walk in, put my large coffee, banana and yogurt (creamy, please) on my desk, hike off my hiking boots (I walk to work) and look for that button under my desk that officially starts the day: the “on” button on the computer. I guzzle a few sips of the piping hot coffee as I wait for the computer to boot up. Once the computer’s ready (it’s temperamental), I search not for new emails, not for documents, but I search for my schedule as I know they’ll be something (or, a lot of things these days) on my calendar that makes me wince. There is always one (or three) meetings staring back at me that garners the “I-don’t-want-to-meet-just-to-meet-anymore” sentiment.

In a time of doing more with less, with job cuts eating into staff productivity, with the excessive amount of presentations executives must present to other executives, most meetings don’t make sense anymore. I’ve reported to “Ms. Healthcare” for awhile now. She is brilliant, fun and very driven. Yet, she is obsessed with meetings—so much so that she proposes pre-meeting meetings to meet about what to meet about. She also requests that I prepare documents for these pre-meetings and send them to her 24 hours prior our meeting. Here’s how one typical meeting rolls:

First 10 meetings: I wait outside her door for her to wrap up her last meeting.

First “official” 5 minutes of the meeting: “What are we meeting about again?” she asks with her arms folded.

Next 10 minutes: I’m trying to walk her through the rationale of why I was asked to prepare a document for this meeting and guide her on what was in the document. It is clear she has not read it.

Next 20 minutes: We spend only 5 minutes talking about the relevant items and the next 15 trying to undo everything we discussed in the last 30.

Last 15 minutes: We discuss alternatives to what we think trying to do, only to nix all of the options in every second that follows.

Last 30 seconds: “I’m late for my next meeting,” I’m told, as I collect my pad and walk out of there with a bewildered look that leaves me confused on my next steps.

Amusingly, I’ve noticed that my meetings are scheduled only on Mondays and Fridays, which leaves me anxious on Sundays and exclaiming TGIF! on most Friday afternoons.  I will bet you cash-money that if you ask a fellow executive, you’ll get a similar response on what a typical meeting feels like. You may ask, “Why don’t you just refocus your boss and do a better job managing up?” Well, our response will be that the executives are not listening to their staff and are so immersed in meetings that they don’t realize this pattern of unproductive busy-ness that most take so much pride in.

Here’s how I’ve learned to focus the meetings that I lead:

  1. Send out the documents prior to the meeting and require people to read them before the meeting.
  2. Do not bring copies of the documents to the meetings. For the non-readers, they will quickly learn that you mean business!
  3. Send an agenda prior to the meeting. Keep it less than 4 bullets.
  4. With the agenda, send out the question you need to answer with the meeting members before the meeting ends. This will focus the meeting.
  5. Respect people’s time—you get extra brownie points for ending the meeting earlier than planned.
  6. Thank people for their work and make sure there are next steps, with accountable folks and deadlines.
  7. Set up the next meeting immediately, following the timelines given at the meeting.
  8. Presto. Here’s another cash-money bet: You’ll end the meeting in less than 40 minutes.

Now, I’m not espousing that we don’t connect with our fellow workers, and that we don’t mingle, schmooz and banter around. But we’re all busy and we’re all drowning in governmental regulations, expenditure reduction initiatives, staff shortages and changing policies due to the new health reform projects. To keep the ship afloat, let’s meet more efficiently!

Here’s another quick solution to reduce meeting time and keep things focused: conference calls. There is no better way to get a one hour meeting condensed into a 10 minute discussion that is pointed, productive and empowering. Chat away!

Jacob Victory, an NYU-Wagner alum, is the Vice President of Performance Management Projects at the Visiting Nurse Service of New York. Jacob spends his days getting excited about initiatives that aim to reform and restructure health care.  He’s held strategic planning, clinical operations and performance improvement roles at academic medical centers, in home health care and at medical schools. Jacob also exercises the right side of his brain. Besides drawing flow charts and crunching numbers all day, he makes a mean pot of stew and does abstract paintings, often interpreting faces he finds intriguing.


“My Boss, Ms. Healthcare: Leadership in Action”


Posted by Jacob Victory

I embrace the theory that leadership is an action-step. And I also think that bosses are an interesting species. It is sometimes hard not to notice themes when colleagues and friends who work in pharmaceutical firms, nursing homes, home health care agencies, hospitals, health care law or managed care organizations describe their bosses. “I need a leader, not a boss!” proclaims one close friend. “She’s a busy regulatory expert who can’t operationalize anything,” says one colleague. Another quips, “I can’t find him. He’s always focused on preparing board documents and is not interested in the day-to-day details.” Yet another smirks, “My boss is so overwhelmed putting out fires and worrying about reimbursement cuts that she rarely provides any direction—so I make the decisions that she needs to make for me!”

One synthesized it succinctly: “Healthcare has too many busy leaders who are focused on changing regulations or survival.” Indeed, healthcare insurance coverage, utilization, care delivery and reimbursement structures are evolving (I won’t use the word “changing”). As a service industry, healthcare is solely about people helping people. What help do our leaders need to manage their people, who can then help others to make this industry churn?

Since most of us work in the health care industry, let’s for a moment assume that we all share the same boss. We’ll call her “Ms. Healthcare” (I say “Ms” strictly based on personal experience, as I’ve had 11 bosses in my career thus far and nine have been women). Ms. Healthcare walks into her office every morning and faces: 1) Clinical staff shortages; 2) Changing regulations; 3) Chronically ill patients who need more coordinated care; 4) Reimbursement that increasingly does not cover expenditures; 5) An inquisitive board who seeks solutions; and 6) Management staff who fear self-implosion if they receive another project to manage—without resources. Let’s also assume that Ms. Healthcare has developed a short-attention span, is anxious, doesn’t espouse project management, and is continually faced with the same six issues I list above.  And with phone calls and meetings that clog her calendar all day, it can seem like it’s an endless cycle. (Luckily, patients continue to be served.)

Ms. Healthcare, being of awesome power and might, feels she can conquer everything. She is bright, hard-working and dedicated. Indeed, Ms. Healthcare has a lot to offer. She is continually chipping away at ensuring efficiencies, new care models, staff development and patient care. I’ve learned a lot from Ms. Healthcare, too. She’s taught me to think at a high-level, that building relationships are key and to have high expectations of myself and others. But let’s consider some easy leadership tips I’ve learned in my own experiences leading people, programs and projects and what I’ve observed in the experiences of others that she can follow to make her day even more productive. If I was her coach, I’d advise her to:

1.  Go to your computer. Find the delete key. Cancel 50% of your meetings. You don’t need them.

2.  Get a pen. Make a list. Prioritize your objectives. Do we really need all those projects completed simultaneously?

3.  Grab the phone. Call your direct reports. Check-in. Do you know how much a “How’s it going?” can re-energize your staff? And how much thinking has been done on staff development and succession planning?

4.  Find a clinician. Ask him what he needs. Are you prepared for what he might say?

5. Call a politician. Invite them to take a tango lesson with you. Could you dare your government to seek your input?

Now, you may think that the five points above are droll or too simplistic. My next five blog postings will address each respective tip in a bit more detail.  Blog postings thereafter will address the other healthcare issues that Ms. Healthcare faces. Leadership is indeed a verb, an action-step. I firmly believe that it can be easy only if its simplest tasks are mastered.

Jacob Victory, an NYU-Wagner alum, is the Vice President of Performance Management Projects at the Visiting Nurse Service of New York. Jacob spends his days getting excited about initiatives that aim to reform and restructure health care.  He’s held strategic planning, clinical operations and performance improvement roles at academic medical centers, in home health care and at medical schools. Jacob also exercises the right side of his brain. Besides drawing flow charts and crunching numbers all day, he makes a mean pot of stew and does abstract paintings, often interpreting faces he finds intriguing.