Becker's Hospital Review

Save the Date: Becker's Hospital Review CEO Strategy Roundtable - Nov. 5, 2014 - Chicago 49 no matter where you are starting from, significant improvement in cost can and should be made. But organizations must have an operating system in place to deliver reliable results. Most healthcare organizations do not have an operating system. Healthcare is a business, and most businesses ac- tually have an operating system — if they're suc- cessful. That's what we've been learning over the last de- cade, not only at ThedaCare but at a number of places around the country. We administer a peer- to-peer learning community called the Healthcare Value Network. It's a group of 59 health systems around North America, and they are all trying to apply these principles of operational excellence using the Toyota Production System applied to healthcare. Almost everyone has been showing re- ally remarkable improvements in cost and quality. The New York City Health and Hospitals Corpo- ration, a very large public safety-net, has taken almost $350 million out of its cost structure while improving quality, and they have it documented. Akron Children's measured waste in terms of wait times for kids. They've reduced wait times for kids by 47,000 days [over four years]. That's unbeliev- able! I love that number. Q: Now is that an observation you've held for a while, or is it something you've no- ticed in this role over the last few years? About the lack of operating systems? JT: Well, I've had the privilege of visiting many, many healthcare systems: 130 at this point, in 13 countries. So I've been looking for the Toyota of healthcare for the last 11 years. I haven't found it yet. But what I have been doing is helping organi- zations understand how they might become that, and that's where this Healthcare Value Network is coming in. What [hospital leaders are] really try- ing to do is learn from each other, so we facilitate that learning. We bring the executives together and then go visit each one of these hospitals. Thirty to 40 ex- ecutives go visit each of the organizations, and we facilitate the learning around what they're doing well. [Organizations] have to be willing to share everything to be part of the network, because our goal is that we're going to steal shamelessly. That's how we're going to change the system: When we learn something, we're going to share it with others. And it's working. A lot of [hospitals] are really willing to open their doors and [say], "Come in and see how we did it, what we learned, what we did badly and what we did well." n Without proper strategic planning, any company will make itself susceptible to large risks. Take Hummer. Throughout the 2000s, the automotive maker continued to build large, gas-guzzling vehicles despite the fact strict emission standards, rising oil prices and employee wage risks were becoming evident. By the end of the decade, Hummer sales plummeted, and GM eventually dissolved the Hummer division. At the Becker's Hospital Review 5th Annual Meeting in Chicago on May 16, Barry Arbuckle, PhD, president and CEO of MemorialCare Health System, a six-hospital system based in Fountain Valley, Calif., explained that strategic planning could prevent major collapses like Hummer. And for health sys- tems, "there is no more critical time than now to have a robust strategic plan- ning process." Strategic planning sounds nice in theory, and everyone likes to talk about it. But it needs to be more than lip service, he said. In fact, executives who don't think about and plant for their health system's future are doing so at their own risk. "Without a robust and dedicated strategic planning process, it's very likely I'd be unemployed," Dr. Arbuckle said. Dr. Arbuckle outlined eight "keys" he believes are necessary for a successful health system strategic planning process today. 1. Building a timeline that allows for advanced education and study. 2. Creating a systemwide prioritization process. "Many times we have great ideas and don't put anyone in charge," Dr. Arbuckle said. "Or even worse, we put everyone in charge." 3. Developing cascading entity planning, better known as lean manage- ment strategies. 4. Linking to the 10-year financial plan and budgeting process. 5. Incorporating Kata, or Toyota, principles for detailed initiative planning. 6. Using 90-day cycle thinking to communicate key progress and next steps. 7. Utilizing deep dives for "gnarly issues" and consensus building. 8. Creating linkages into systemwide strategic marketing for patients, physicians and staff. n 8 Keys to Successful Health System Strategic Planning By Bob Herman SUBSCRIBE TODAY! Becker's Hospital Review CEO Report E-Weekly Guidance, analysis and best practice information on hospital leadership, operations and management issues for top hospital and health system executives Each E-Weekly, sent every Tuesday, contains the most popular feature articles covering business and legal issues, CEO profiles and benchmarking and statistical data to immediately inform your decision-making To subscribe to the FREE E-Weekly, visit www.BeckersHospitalReview.com and click on the "E-Weekly" tab or call (800) 417-2035

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