“I remember where we kept those extra life vests,” the porter shouted in the water of the icy northern Atlantic.
There were roughly 900 crew members on the Titanic, most of whom performed menial tasks, tasks that were to be accomplished without ever being seen by the paying voyagers. While many of the crew serviced the passengers, a larger group serviced the ship. They washed the laundry, hosed down the deck chairs, and polished the miles of brass railing. The ship was staffed to do almost everything that needed doing with the possible exception of having someone in charge of making sure the ship did not sink.
A slight oversight when you think of all the other functions they did not overlook, but one that would prove to be a little more important than making sure the handrails on the aft-deck gleamed.
It should make you want to ask who is running the show. I ask that question frequently when I look at where the provider healthcare business is headed. Somebody should be asking, “Is that an iceberg up ahead?”
Providers, large and small, have someone or some group whose mission in life is twofold; spot the icebergs, and tell someone about them. Those brass-polishers are most often called business planners or strategists. They often reside on the org-chart in a tiny box labeled strategy, and they report solely to the chief executive.
Strategery. A term coined on Saturday Night Live. Let us draw a quick distinction between the term strategy and the term strategery. Strategy is actionable. Strategery is not. It is no more real than the Easter Bunny, and holds no more value than a three-dollar bill.
An example of a valid provider strategy would have been seeing that consumerism was about to grow exponentially, and developing a plan to either turn it to your advantage, or at a minimum developing a plan to ensure it did not hit your system over the head with a two-by-four.
On the converse, a provider strategery would be recommending that the system’s flagship hospital redesign its lobby to make it look like a safari theme-park, and adding a taco bar to the cafeteria.
One adds value; one does not.
If you search Google, there are many examples of provider strategeries. I read several of them. I then searched to see if I could find a single provider strategy that inventoried the relevant pressing issues and detailed a plan about that provider’s plans to attack those issues. I could not find a strategy.
There seem to be two basic flaws inherent in most provider strategic plans:
- They are not strategic
- They do not include a plan
Most businesses begin to die the moment they open their doors. Some work harder at it than others. Those which die the fastest are those that mistakenly believe that a budget is the same thing as a plan. The whole organization is expected to participate in the budget process. IT needs additional capital to buy more stuff because the last stuff they bought did not add much value. Marketing needs more money to attract and capture new patients even though they cannot identify by name the last patient they brought into the fold. .
It is easy to tell the focus of a health system’s business strategy. Just review the approved budget. If you do you will find line dozens of line items that will add no more value than polishing the Titanic’s brass railings. Strategery.
What you probably will not find are dollars allocated to undertaking tasks dedicated to keeping the organization in business. Strategy. Notably missing are investments towards and accountability for:
- Consumerism and delivering retail services
- Interactive digital access
- Customer acquisition
- Patient retention and referral
- Backend leakage prevention
- Frontend leakage prevention
Ask yourself this; how many dollars of revenue is your health system forecasting from delivering retail services and consumerism in 2018? Is there a line item, or any mention in the annual report stating, “By 2018 we expect twenty-percent of our revenues, and ninety percent of our revenue growth, to come from delivering retail services?” I am willing to bet my neighbor’s BMW that your system has not written anything even close to that. And if it hasn’t those revenues will not exist.
The health system, Our Lady of Non-Innovation, will continue show year-over-year revenue growth. Usually they accomplish this business wizardry by acquiring another organization. Net-net, they haven’t really grown at all.
The big trend in the nineties was the addition of coffee kiosks that proudly served Starbucks. I am willing to bet that before this decade is out more than one health system will have explored the notion of entering consumerism by placing a CVS Minute Clinic in its lobby. Strategery.
Remember, you read that here first.
Something magical can happen only when an institution turns a thought into written words. The next time you are sitting in a meeting and wondering whether the Cubs are winning their afternoon game, do this. Leaving plenty of blank space in your leather notebook write these three words: issue, opportunity, approach. Then fill in the blank space.
And then show what you wrote to someone. Who knows, maybe that someone will have written the same three words. And if they did, you now have your own planning committee. That is as far as I am willing to take you today. The rest is up to you.