Shockney Byrd StrategicPlanning by 4HA1WqpQ

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									           Ensuring Success
          A Local Approach to
           Strategic Planning




Brian Shockney, HFA, FACHE   Vicki Byrd, BA
               Memorial Hospital
Founded in 1925
Located in Cass County, Indiana
County Not-For-Profit
7 member Board of Trustees
83 Acute Care Inpatient Beds
$120 Million Gross Revenue
Memorial Hospital Foundation
Third Largest Employer in Cass County
                 Mission
 “Your Community Resource For Optimal Health”

                   Vision
Memorial Hospital is a progressive market leader
that utilizes innovative services and technology
  to provide compassionate, customer-centered
 care. We are committed to health and wellness
       to achieve an optimal quality of life.
Our Values
                       Objectives
To share with you a journey that creates
success
To help you realize that none of this is
revolutionary – every organization can do it
Ignite the desire to ensure planning and strategy
are an important part of your organization’s
ongoing responsibilities
Learn at least one new concept or idea
                    Start With A
                    New Mindset
The Kind of Thinking That Got Us Into The
Problem Won’t Get Us Out – Albert Einstein
Success Is Most Appropriately Measured Not By
What We Have Accomplished, But By The
Difficulty Of The Questions We Are Willing To
Address – Paul Hawken
Luck Is A Matter Of Preparation Meeting
Opportunity – Oprah Winfrey
                 Why Develop
                Strategic Plans?

If you fail to plan – then you plan to fail
Performance is the key to success
Solves major issues through reflecting on
the whole organization (seen and unseen)
Communicates to everyone – what is
important
           So Many Models
           To Choose From

       Goal-Based



                                    A-B-C-D


Listening To The People


                          Organic
               Free Advice

 The model is not important.

What is important is to ensure
 the process and structure fits
       the culture of your
          organization.
                   Formal Planning
Builds upon and dependent upon preservation
and rearrangement of existing goals, products,
and services
Focused solely on the quantitative
Comfortable for organizations where reports,
numbers, forecasts, and data only are needed
for decision making (Annual Budgeting)
Usually a result or tasks that results from
strategy
                    Strategic Thinking
The most successful strategies are not plans,
they are visions
“Capturing what we learn from all sources (both
the soft insights from your personal experiences
and the experiences of others throughout the
organization and the hard data from research
and the like” – Henry Mintzberg
It involves intuition and creativity able to freely
appear through processes carried out by various
people at various levels in the organization that
are deeply involved in the issue at hand
                  Strategic Thinking
It has to occur outside of the organization chart
boxes that fosters informal learning and
produces new perspectives
Incorporates qualitative information
Balances between data-driven decision making
and soft forms of information including gossip,
hearsay, and other scraps of information
Works in organizations that value input from
every level – most importantly customers
               Tacit Knowledge

        By definition, tacit knowledge is
 knowledge that people carry in their minds
      and is, therefore, difficult to access.
 It is most often overlooked in planning and
decision making, however, it is critical to your
                    success.
                 Tacit Knowledge
Often, people are not aware of the
knowledge they possess or how it can be
valuable to others.
Tacit knowledge is considered more
valuable because it provides for people,
places, ideas, and experiences.
Effective transfer of tacit knowledge
generally requires extensive personal
contact and trust.
              Tacit Knowledge
Simply put:
 "We know more than we can tell."

Tacit knowledge consists often of
habits and culture that we do not
recognize in ourselves.
     Do you REALLY care what your
       employees know will work
or needs to be changed for your success?


         They Do.
 And so do your customers!
                  Tacit Knowledge
In the field of knowledge management the
concept of tacit knowledge refers to a knowledge
which is only known by an individual and that is
difficult to communicate to the rest of an
organization.
Knowledge that is easy to communicate is called
explicit knowledge.

The key is to use a process that transforms
tacit knowledge into explicit knowledge.
            “Useable Information”
                       Memorial’s Journey
1998 – Routine planning creates a routine organization
  Many strategies and goals with 50% completion/success
1999 - Executive Visioning/Strategic Thinking
  Board, Medical Executive Committee, Executive Leadership
2001 – “Advance”
  Executive Visioning/Strategic Thinking
  Added Department Directors
2008 – Baldrige Journey Begins
  Inverted Organizational Chart and “Advance”
2009 – Year Round Strategic Advances
  Employee Roundtables/Surveys
             Strategy Advance

  Board            Employees



Executives         Department
                    Directors

Department
 Directors         Executives


Employees            Board
            Information Gathering
                    Tools
Employees
 New Personnel Orientation
 Employee Roundtables
 Focus Groups
 Annual Employee Survey
 President/Employee Meetings
 Department & Meeting Visits
 Executive Rounds
 Assignment to Initiative Task Forces
          Information Gathering
                  Tools
Management
 Annual Employee Survey
 Department Director’s Meeting
 Formal Strategy ‘Advances’ (2/year)
 Wednesday Stand Up Strategy Briefing
 Assignment to Initiative Teams
             Information Gathering
                     Tools
Executives
 Annual Employee Survey
 Executive Leadership Meetings
 Formal Strategy ‘Advances’ (2/year)
 Wednesday Stand Up Strategy Briefing
 Leadership of Initiative Teams
               Work Groups Defined
Committee: Long-standing group of individuals
organized around a common strategy but with
multiple goals
Team: Short-term (< 12 months) group of individuals
organized around a common goal that requires
process identification and change
Task Force: Quickly organized group of
individuals organized around a common task to
identify best practice, fix a common cause issue
and provide input to a team (JIT)
               Why is this important?
To ensure participants and the rest of the
organization understand the scope of work and
time frame for completion
  Resources, Resources, Resources
Establish lines of communication and reporting
  Avoids overlapping work from other groups and
  communication of successes
Command accountability
Follow-up should account for 10 times the effort
of planning and selecting
      The “Advance”
 The troops assemble to
develop the battle plan and
   design its execution.
                       Ground Rules
Participate Actively
Communicate Professionally
  Listen Carefully
  Speak With Respect – One Person At A Time
  No Side Conversations
Speak From Knowledge Not Assumptions
Hold All Confidences & Information
Call ‘Time Outs’ and ‘Fouls’ As You See Them
Take Breaks As We Need Them
Have Fun!
Sometimes, It’s About Process And Not Outcome
Environmental Scan
            Environmental Assessment
                 (SWOT Analysis)
Strengths, Weaknesses, Opportunities, Threats
Yes, it is important…
  Gets everyone on the same page to start
  Helps everyone understand your perspective
  To know where you are to see if you are moving
  toward somewhere else
Must be a brutally honest assessment of the
current state
Identify Barriers to Our Success
                &
    Solutions To Overcome
          The Barriers
                        Medical Staff
Barriers To Success               Solutions To
1. Physicians Financially         Overcome
   Constrained and Seeking    1. Align Hospital : MD financial
   More from Hospital not        incentives
   Less                              Low salary
2. Increasing Bureaucracy &          High RVU bonuses
   Work Required for          2. Make creative practice
   Hospital Success              opportunities available
                                     ½ time
                                     No call, etc.
                                     Hospitalist only
                              3. Allow clinical autonomy
                                     Bonus for excellent clinical
                                     performance
            When It’s The Right Thing To Do…

Renegotiated Salary and Incentives of ALL
Employed Physicians/Providers
  Not for the faint of heart
  Lost a couple of primary care physicians
  Kept the end in mind
Improved Satisfaction Rate
From 8 Providers to 36 Employed Providers in
15 Months
Brainstorm Other Goals & Initiatives
 You Would Like The Organization
           To Achieve
                   Process for Strategies
Brainstorm
  Sticky notes and flip charts
Clarify Each Idea
  Be sure everyone understands your intent
  Combine like items
Affinity Diagrams
  Group in like categories
  Assign strategy name to groupings
If More than 10 Large Groupings…Multi-Vote
  Sticky-dots to gain priority
  Select the top 10 to move forward
                                     Strategy #1
             Initiative                             What

Physician Practice Viability   1.    Determine Definition of Adequate Staffing
                               2.    Reduce Expenses – O.H.
                               3.    Increase # of Pts. Seen/Provider
                               4.    Remove Barriers to Patients Being Seen
                               5.    Gain Provider Buy-in/Support
                               6.    Standardize Office procedures:
                                    1.    Forms
                                    2.    Collections
                                    3.    Reports
                                    4.    Coding
                               7.    Create Performance Dashboards for Reports
                                     to Providers
                               8.    RVU & Quality Based Contracts
                                    1.    Base
                                    2.    Incentives
How many diets does it take
     to lose weight?
         Answer:

Only The One You Stick To
         Gut & Reality Check
        It’s easy to let the process of
         planning take over and miss
            […Forest For The Trees]

       What Really Needs To Get Done.
Ensure accomplishment as well as performance.
                   A Lack of Accountability
                       By Dan Beckham
            May 18, 2009 in HHN Magazine online site
         What Needs To Stay?
       Are We Missing Anything?
               [Tacit Knowledge]
Carry Forward To Organizational Priority List
  1.) Is It Critical To Our Success?
  2.) Will It Get Done Anyway?
  3.) Will It Defy Mathematics?
       Everyone will be working
     to accomplish our priorities…
             Last Call!
         Prioritize The List
From Highest Priority to Lowest Priority…
      1. Importance to the Mission
     2. Greatest contribution to the
           organization’s success
  3. Ability to accomplish < 12 months.
      [Score 1 (Low Value) – 5 (High Value) ]
                              Prioritized List
Large Affinity        Importance To   Greatest       Accomplish   Total
                      The Mission     Contribution   <12 months   Score
Groupings
Physician                   5               5             4        14
Practice Viability




  Take the Top 3-5 Depending on the Organization’s Available Resources
                Determine Your Format
Traditional
  Initiative/Goal
  Objective
  Strategies
What, How, Who, When
Initiative, Goal, Role, Function
Baldrige Pillars and Scorecard

 Again, what fits your organization’s culture?
                Bridging The Gap Between
                     Strategy & Action
                            MISSION
                            VALUES
                  STRATEGY: Our Game Plan
                      The Balanced Scorecard
           STRATEGIC INITIATIVES: What WE need to do
           PERSONAL OBJECTIVES: What I need to do


                      STRATEGIC OUTCOMES

Customer    Quality       Financial &    Process &     Workforce &
 Focus     Outcomes          Market      Operations      People



               Desired Outcome: The Gut Check
            When It’s The Right Thing To Do…

Renegotiated Salary and Incentives of ALL
Employed Physicians/Providers
  Not for the faint of heart
  Lost a couple of primary care physicians
  Kept the end in mind
Improved Satisfaction Rate
From 8 Providers to 36 Employed Providers in
15 Months
                                Improve Physician Practices

                        STRATEGIC PLANNING & LEADERSHIP

      Customer            Quality         Financial &       Process &           Workforce &
       Focus             Outcomes            Market         Operations            People

      Measurement        Measurement       Measurement       Measurement          Measurement
                                                                Increase
                                                              Average Daily      Participants in
                                          15% Increase in     Patient Seen      Employee survey
                                             Practice        By Provider by
     Net 3 additional                                                                   of
                                           Performance      1 patient per day
        Providers                                                                     >85%
                        >95% Compliance
                               with                           Selection of      Turnover % < 5%
                                             Increase       Primary Vendor
      Press/Ganey         e-Prescribing
                                           Net Referral     for Office EMR
       Satisfaction          Initiative                                            Quarterly
                                             Revenue           by July 1st
      Questionnaire                                                             Office Meetings
                                          per Provider by
       >90% Score                                           Develop space         w/ Training
                                                4%
                                                               allocation          Sessions
                                                            Plan by May 1st     >75% attendance


Desired Outcome: Maintain or decrease practice expense while increasing referrals
and patient access
            When It’s The Right Thing To Do…

Renegotiated Salary and Incentives of ALL
Employed Physicians/Providers
  Not for the faint of heart
  Lost a couple of primary care physicians
  Kept the end in mind
Improved Satisfaction Rate
From 8 Providers to 36 Employed Providers in
15 Months
Getting It To The Department
Level & Employee Work-life
        Department Measures

   When you come to work each day,
        what are aiming for?

        How do you contribute?

How do you know if you were successful?
                 Department Measures

Customer Focus
Quality Outcomes
Financial & Market
Process & Operations
Workforce & People


Pick at least 2 measures, post, and follow
                            Laboratory Example
                     Following Each Phlebotomist, Nurse, EMS, etc.



           Blood Culture Contamination Rate (<3%)
   Month   # Contaminated     # Collected        Contamination Rate
January          2                121                  1.65%

February         3                155                  1.93%
March            4                171                  2.33%

TOTAL            9                447                  2.0%
 Improve The Process
      Each Year



PLAN    DO


ACT    STUDY
      It’s All About Outcomes


Do You have a Plan?
Does The Plan Work?

[Evidence from Memorial]
                  2008 Initiatives


1.   Physician Practice Viability
2.   Community Health Needs Assessment
3.   Process Redesign – Cost Reduction
4.   New Revenue Generation
5.   Upgrade Productivity/Labor/Reporting
                                      Hospital O/P Revenue vs.
                                       Phys Practice Revenue
                                  Hospital O/P Revenue vs. Physician Office Revenue

20,000,000                                                                                                              4,250,000
19,500,000
                                                                                                                        3,750,000
19,000,000
18,500,000                                                                                                              3,250,000

18,000,000
                                                                                                                        2,750,000
17,500,000
                                                                                                                        2,250,000
17,000,000
16,500,000                                                                                                              1,750,000
16,000,000
                                                                                                                        1,250,000
15,500,000
15,000,000                                                                                                              750,000
             1Q 2007   2Q 2007   3Q 2007      4Q 2007         1Q 2008      2Q 2008        3Q 2008   4Q 2008   1Q 2009

                                           Hosp O/P Revenue       Physician Practice Revenue
                                                                             Admissions
                                       I/P Admissions and Observations vs. Hospital Outpatient Visits

1,250                                                                                                                                                   25,500

1,150                                                                                                                                                   25,000
                                                                                                                                                        24,500
1,050
                                                                                                                                                        24,000
 950
                                                                                                                                                        23,500
 850
                                                                                                                                                        23,000
 750
                                                                                                                                                        22,500
 650
                                                                                                                                                        22,000
 550                                                                                                                                                    21,500

 450                                                                                                                                                    21,000
        1Q 2006 2Q 2006      3Q 2006      4Q 2006 1Q 2007       2Q 2007    3Q 2007 4Q 2007        1Q 2008 2Q 2008     3Q 2008    4Q 2008 1Q 2009

         Acute + Observation admissions       Hospital Outpatient Visits    Linear (Hospital Outpatient Visits)   Linear (Acute + Observation admissions)
                                            Avg. Length of Stay
                                            Avg Length of Stay

4.00
3.90
                            3.87
3.80
3.70
3.60                                                                 3.56
3.50        3.51    3.51                    3.52
                                                            3.44            3.47
3.40
                                                                                    3.34    3.31
3.30                                                                                                       3.27
                                                    3.27
3.20                                3.20                                                            3.18
                      Hospitalist Program Begins
3.10
3.00
       1Q 2006 2Q 2006 3Q 2006 4Q 2006 1Q 2007 2Q 2007 3Q 2007 4Q 2007 1Q 2008 2Q 2008 3Q 2008 4Q 2008 1Q 2009

                                                   Acute   Poly. ( Acute)
                             Paper Olympics
                                Update
                                   2008 Prizes

                            Gold – 1 Full PTO Day
                            Silver – ½ PTO Day
                            Bronze – Pizza Party
                               •Most Approved Ideas
                               •Most Paper Savings
                               •Most Cost Savings
Cash & Certificate Awards
                          Success

             Logansport Memorial Hospital
         2007-2008 Paper Shredding in Pounds
                 Comparison by Year
50,000
         45,756                                   Total difference of 13,145 pounds
45,000

40,000

35,000                                   32,611

30,000

25,000

20,000

15,000

10,000

 5,000

    0


                  2007                2008
                                    Success


                       White Paper Usage by Year
10,900                                                         30,000.00
                                                   29,645.00

10,800                                                         29,500.00

                                                               29,000.00
10,700

                                                               28,500.00
10,600
                                                               28,000.00
10,500
                                                               27,500.00
10,400   27,039.00
                                                               27,000.00

10,300
                                                               26,500.00

10,200                                                         26,000.00
              10,800                                10,342
10,100                                                         25,500.00
               2007                                  2008

                            Reams          Cost
                              Success


                 2 Part Paper Usage by Year
178                                                             2,000.00


176   1,989.68                                                  1,990.00


174
                                                                1,980.00

172
                                                                1,970.00
170

                                                                1,960.00
168                                                  1,957.00


                                                                1,950.00
166

       176                                    169
164                                                             1,940.00
      2007                                    2008

                      Reams           Cost
                                            Express Med Impact
                                 ER Activity and the ExpressMed Effect

4,300
4,200
4,100
4,000
3,900
3,800
3,700
3,600
3,500
        1Q 2006 2Q 2006 3Q 2006 4Q 2006 1Q 2007 2Q 2007 3Q 2007 4Q 2007 1Q 2008 2Q 2008 3Q 2008 4Q 2008 1Q 2009

                                     Total Visits   ExpressMed Visits   Poly. (Total Visits)
                                                                      Revenue

180,000,000


160,000,000


140,000,000


120,000,000                                                                                                                  125,208,044
                                                                                                               116,319,008

100,000,000                                                                                      106,614,238
                                                                                    99,762,356
                                        92,604,132   91,938,799     92,928,233

 80,000,000
                           70,127,300
              58,210,547
 60,000,000


 40,000,000
                                                                                                               50,905,788    52,479,212
                                        42,566,531   41,656,769     42,122,020      43,370,494   44,852,503
 20,000,000   35,235,498   36,714,221


          -
               2001         2002         2003         2004           2005            2006         2007          2008         Proj 2009


                                                      Net Revenue   Gross Revenue
                                    PATIENT ENCOUNTERS
                                         (2003 – 2009)
250,000




200,000




150,000




100,000




 50,000




      -
          Total 2003   Total 2004   Total 2005        Total 2006      Total 2007   Total 2008   Proj 2009

                                                 Patient Encounters
                                                  Productivity Hours
10000

 9000

 8000

 7000

 6000

 5000

 4000

 3000

 2000

 1000

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                                                                                             2009
                          OT                Over FTE                     Goal FTE                   Goal OT
                                 Productivity Dollars
$180,000.00

$160,000.00

$140,000.00

$120,000.00

$100,000.00

 $80,000.00

 $60,000.00

 $40,000.00

 $20,000.00

      $0.00
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                                                                           #1
                              OT                 Over FTE
                      Financial Performance
                          2007             2008         Change
Inpatient Revenue        $33,396,447     $29,947,753    ($3,448,694)
Outpatient Revenue       $73,217,791     $86,371,255    $13,153,464
Bad Debt/Deductions     ($61,111,763)   ($63,769,705)   ($2,657,942)
Community Asst.          ($1,738,282)    ($2,198,321)     ($460,039)
Net Operating Rev.        $44,729,126     $50,905,788    $6,176,662

S&W                      $20,814,193    $23,525,756      $2,711,563
Benefits                  $4,964,055     $5,639,786        $675,731
Operating Expenses       $20,480,388    $20,310,189       ($170,199)

Investments                $526,937        $384,091       ($142,846)

Net Income                 ($832,374)    $1,643,949      $2,476,323
                     Financial Performance
                    YTD April 2009    YTD April 2008          Change
Gross Rev.               $42,365,710      $39,779,448          $2,586,262
Bad Debt/Deductions     ($23,833,788)    ($22,649,968)         $1,183,820
Community Asst.            ($977,152)       ($753,607)          $223,545
Net Operating Rev.        $17,770,240      $16,623,026         $1,147,214
                        w /o 58 cents/$1   w /o 58 cents/$1
S&W                         $8,167,615        $7,591,967        ($575,648)
Benefits                    $1,896,168        $2,026,021         $129,853
Operating Expenses          $7,246,687        $6,786,765        ($459,922)

Investments                    $113,086          $135,060        ($21,974)

Net Income                     $572,855          $353,334       $219,521
                     Final Thoughts
You can’t get there overnight
  Memorial’s 3-5 Year Journey
Rewards = The Level of Risks You Take
  Do you really want to hear what customers say?
  Do you really want to hear what employees think?
Be Passionate About Wanting To Achieve
Success
  They model what they see (Actions speak…)
There is no ONE right way – it must fit your
culture and most importantly - achieve success
                    Did We Meet Our
                       Objectives?
To share with you a journey that creates
success
To help you realize that none of this is
revolutionary – every organization can do it
Ignite the desire to ensure planning and strategy
are an important part of your organization’s
ongoing responsibilities
Learn at least one new concept or idea
 As we participate in a profession, economy,
 and our communities that are struggling, it is
  easy to focus on the negative and focus on
                  our failures.

While success in our profession is never easy
       to attain, Theodore Roosevelt said
 something that is appropriate for those of us
      participating in the planning for our
                   organizations.
“Far and away the best prize that
  life offers is the chance to work
      hard at work worth doing.”
           Theodore Roosevelt

								
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