Tag Archives: Management

Let’s Meet to Meet

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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.


What Is My Company Worth – Part I

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Posted By Joel Wittman, MS,MBA

Given the uncertainty created by Obamacare, health care companies have begun seeking consolidations through mergers and acquisitions as one of their future survival strategies.

This question of the value of a company frequently arises in conversations with owners, principals, and management of health care entities.  “Sure I’d sell my business.  Sure I think that we’d make a powerful team.  One question, though: How much is the business worth?”  The short answer is – it all depends.

To begin to understand the value of a company, the fundamentals of value must be explained.  A correct standard of value has to be established.  Fair market value fundamentals are based on the average price for the average buyer with neither party compelled to buy or sell and both parties being informed of the relevant facts.  Consequently, fair market valuations are typically at the lower range of the market.  Investment value fundamentals, however, are based on a specific price for a specific buyer and are based on an investor specific basis.  Ergo, value is extremely buyer dependent.  A company is worth what a buyer is willing to pay for it.  It’s like a home plate umpire in baseball.  The batter lets a pitch go by and then asks if it was a ball or a strike. The umpire’s answer: “It’s nothing until I make the call.”  It’s the same with the value of a business – it is worth what a buyer is willing and able to pay.

It is not my intention to be facetious about this topic but there is not a clear answer to the question.  There are common valuation techniques that establish parameters and metrics for valuing businesses.  Among these techniques are the calculation of the Net Book Value of a company, the use of Public Market Comparables, the creation of a Discounted Cash Flow model favored by financial buyers, the use of Comparable Transactions of similar companies if the data is available, and ,the most common metric,  the application of a Multiple of Earnings (after the appropriate level of earnings has been established – but that’s for another time).  Which leads to the question of how are multiples established?  Remember, value is extremely buyer dependent: one buyer may be inclined to assign a higher multiple to earnings than another buyer based on the first buyer’s reasons to complete an acquisition.  However, the range of multiples can be tied to the level of risk the buyer is willing to tolerate to “make the deal.”  Each buyer has a specific rate of return they would like to achieve from their investments.  An acquisition is another form of investment and can this investment earn a return comparable to, or greater than, other investment opportunities.

The range of value and assignment of a valuation metric is dependent on the risk of the investment.  The risk reflects the buyer’s required rate of return.  The lower the perceived risk, the higher the value metric; the higher the risk, the lower the metric and, intuitively, the lower the price.  However, there are determinants of risk that are specific to a company and can be managed by the company.  Among these are having:
•    diverse referral sources (the more, the better; the company is not overly reliant on one or two sources for its revenue stream)
•    a diversified product and revenue mix which can lead to a more predictable revenue stream
•    a diversified payer mix – don’t be too susceptible to changes in reimbursement
•    the influence of managed care on the company’s revenue stream – This typically
leads to lower reimbursement.  If a client of a medical staffing company ( such as a hospital) receives a large portion of its reimbursement from managed care payers they are less able and willing to pay full amounts for your company’s services.
•    middle management strength -  One of the most harmful things that you can indicate to a prospective buyer is that “you are the business” and that it cannot function without you.  Buyers are justifiably concerned that there will be a precipitous decline in revenues post transaction if this exists.  It is imperative to develop your management staff to the level of being able to function in your absence.
•     knowledge of your current business trends.  Is yours a stable and growing business that presents lower risk to a buyer?  What are the business trends in your marketplace?
•    knowledge of your competitors – Are they aggressively soliciting business? How many competitors are there in your market?  The fewer the number of competitors, the more predictable is your company’s revenue stream.
•    efficient accounts receivable management – This provides a snapshot of your operating infrastructure and management capabilities to a buyer.  The lower your company’s bad debt expense and days sales outstanding (the average time it takes to convert a sale into cash), the more predictable is your revenue stream, the lower is the perceived risk to the buyer, the higher valuation metric can be assigned to your business. Management and control of these company specific determinants of risk to the extent possible will increase the potential purchase price of a company.

Read my post in next month’s blog to learn about what strategies to implement to enhance the value of an M&A transaction.

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.