By Scott Regan, Chief Executive Officer, strategicplanningMD

Developing a culture of execution doesn’t happen by accident. It takes focus, hard work, consistent effort, and a proven roadmap by which to navigate. While we can’t make the first three components any easier for you, we certainly can make your journey more directed and successful by providing a comprehensive methodology for implementing a best-of-breed Execution Management System. Our Execution Flywheel is derived from nearly one hundred years of combined management experience and has resulted in dramatic organizational transformations.

Components

The Execution Flywheel consists of three parts that, when stitched together, provide consistent, breakthrough results. First, at the core of the Flywheel is strategicplanningMD’s six-stage methodology for strategy development and execution management. Second, the six-stage methodology is put into action using a suite of cloud-based applications and tools, which enables organizations to execute smarter, faster, and better. Third, as organizations circumnavigate the Flywheel multiple times, they naturally evolve from a culture of collaboration to a culture of accountability to a culture of execution. With the execution culture fully realized, organizations are then able to transform into a culture of innovation.

Over the next several weeks, we will detail the various components of the Execution Flywheel, beginning with the four stages of cultural transformation.

As organizations develop a true Execution Management System, they naturally evolve through four stages of cultural evolution, each with its own distinct characteristics. The speed and pace in which an organization transforms itself varies in response to many factors, including size, leadership, competitive rivalry within the industry, the threat of new entrants or market substitutes, the bargaining power of buyers and suppliers, internal constraints and capabilities, and external environmental conditions.

Typically, an organization should take no more than three years to fully evolve into a culture of execution and thus begin the final transformation to a culture of innovation. However, we’ve seen organizations complete the journey in as little as six months. The decision of how fast to move is critical to successfully hardwiring a strategy development and execution management program into the organization’s framework.

Stage 1: Culture of Collaboration

For most organizations, developing a culture of collaboration develops naturally. As organizations create a common vision, executive and middle managers rally together in support of one or more long-term goals. Work plans are developed and a great amount of activity takes place, but the collaborative organization often mistakes activity for results. At this stage, there is very little effort to track tactical implementation against performance targets, and being busy is often an organizational substitute for being strategic. Oftentimes, a lot gets done, but not a lot is ever accomplished.

Next week: Stage 2: Culture of Accountability

By Scott Regan, Chief Executive Officer, strategicplanningMD

Recently, I was engaged in an online discussion about the impact of a name on a brand. The company in question was Radio Shack, which is changing its name to The Shack. Many of the participants argued that the name is a huge component of the brand. With that as a prelude, I offer my response as context to the discussion, and then a response from Peter Russert, president of StealThunder, a brand strategy and brand communications firm. He offers pearls of wisdom.

My post:

I am literally stunned by the posts that have called the named a “huge component” of the brand. Is the name what comes to mind first? Yes. Is it huge? Hardly. Certainly, a horrible name that is offensive or demeaning can derail a brand, but a name will not a brand make. Could Amazon.com have named itself Starbucks.com and had as strong a brand? Could Starbucks have been called Amazon and still dominate this vertical? Yes and yes. History is filled with companies with great names that had lousy brands and companies with great brands that had lousy names. And there are hundreds of examples of companies that renamed themselves without any real impact on the brand itself. You can take any corporate name and, with the right brand positioning strategy, make it a solid brand. The brand makes the name. The name doesn’t make the brand. It’s all about brand integration.

Peter Russert’s reply:

The problem with all these chicken and egg discussions about name and brand, and the ultimate importance of the name, is that brand name and total brand experience quickly fuse together into an inseparable whole. That said, it is a fact of life that the total brand experience ultimately makes any name successful — even the great names. On the other hand, I think it overstates the case to claim that a great name is somehow the beginning of a great brand. Products and value are not built around names. The reverse is true.

That is no excuse to settle for a lame name. Why not create a little bit of poetry that perfectly captures the promise of what you’re selling? Something “sticky,” something to smile at, something inspired? That’s absolutely the strongest position to be in. The worst thing would be to adopt a name that misled an audience about the offering, or “mis-positioned” it. That’s the screen that makes us namers throw away a lot of otherwise good stuff.

But every once in awhile we brand folks need a reality check. As in:

— Scott is right. An awesome product or experience can make even a mediocre name a hero. iPod is nothing special as a name, but it is something I can’t live without. Out of context Prius — well, out of context, I’m not even sure I’d know how to say it. “Pry-us”? It hardly ranks among the great names. But it’s an indisputably great brand. This is so obvious it shouldn’t even need saying.

— On the other hand, no matter how exemplary the name Zima seemed to one respected naming firm, no matter what its linguistic and structural virtues, the product was crap. And so the brand turned to crap. Call it the Zima Rule. A great name does not make a great brand.

— The brand name could be the “first thing I ever hear” about an offering, but do I ever hear it out of context? Has anyone here ever been motivated to explore an otherwise unknown product or service based solely on a name? Doug said: “The right name gets the customer in the store or on the website. We all know the saying: there is only one opportunity to make a good first impression. A name is this opportunity.” Really? Provide an example. Bing? Zune? Palm Pre? Maybe “Free Money” would do it.

As to the original issue, Radio Shack is in a real bind. If someone came to me with a pile of data that told me customers would not accept that a store called “Radio Shack” had anything of relevance for them, I’d have a hell of a hole to climb out of, and not many attractive options. I think the “The Shack” is a dumb mistake. But you have to appreciate the bind they’re in.

On that note, if you were Radio Shack, what would you have done? How would this impact your strategic planning efforts?

By Scott Regan, Chief Executive Officer, strategicplanningMD

Brands are like children; they need constant attention, lots of love, and an occasional time out. Because the brand is merely a reflection of the organization’s mission and culture, it can never be left unattended for long periods of time. The more you imbed the brand into the organization’s operations, the more sustainable – and impervious – it becomes.

What does brand integration mean? It means this: Do you hire with the brand in mind? Do your organizational policies reflect the brand? Is the brand aligned with your leadership team’s management style? If you answered no to any of these – or the 87 other questions I would like to ask you (really, we have 90 questions that will tell us everything we need to know about the current state of your brand) – then your brand is destined to crumble.

Maybe not next week or even next month, but crumble it shall. And no amount of really cool strategic planning or brand positioning advertising will save it.

I have seen too many hospitals develop really solid brands, but built on the backs of advertising, not operations. Consumer preference begins to climb, market share shifts start to occur, volume rises, and so does revenue. Everyone is happy.

In every case, these hospitals have taken a nosedive. Some within 12 months, others held on for as long as three years. They were never able to sustain the brand because the brand was fictitious, the handiwork of great communicators and an even greater creative team.

In these hospitals, as volume began to rise, more and more patients were exposed to the flaws, the chips, and the cracks. And after they were discharged, they told their family, friends, and neighbors about the real brand – the brand they experienced, rather than the brand they saw on TV.

The only way to build an enduring, market-dominant brand is to first create an experience that is brand-worthy; second, manage every aspect of that experience every day; and third, once the brand experience is solidly in place, only then communicate the brand through marketing. This is the basis of every sound brand strategy.

By Scott Regan, Chief Executive Officer, strategicplanningMD

If you think the impact of healthcare reform is six months or more away, then you — and your brand — might be in for a shock. Although the bill’s initial provisions are under attacked and headed to the Supreme Court for final determination, experts predict that the nation’s emergency rooms will begin to flood immediately.

Why? Because people think they have health coverage when they don’t, or when the provisions affecting them don’t kick in for some time. If Massachusetts is any example, the ramifications can be huge. When universal health coverage went into effect there, E.R. visits immediately rose 7%. And because Massachusetts already had a higher number of insureds, the American College of Emergency Physicians is predicting a 10% increase in E.R. visits nationally in the coming months.

What does that mean to you, your strategic planning, and your brand positioning? Everything. Overcrowding will spiral upward. Boarding will become a serious issue, if it isn’t one already. Left without being seen rates will climb. And the hospital that is ill-prepared to deal with this surge will be left with a black eye, a tarnished reputation, and a sullied brand.

But for those hospitals that take steps now — and I do mean now — to adequately prepare for this influx of patients, they can use this tidal wave to enhance their brands in the market place. Nowhere in healthcare is customer service and timeliness more noticeable than in an E.R. Indeed, healthcare reform could easily be one of those defining strategy moments that elevate some brands and destroys others. How well you execute a brand integration strategy with your E.R. operations could prove to be the difference between success and failure.

For hospitals that have built their brands around emergency medicine, the stakes are even higher. Consider the plethora of hospitals now touting E.R. wait times on their web sites or on digital billboards. Their collective brand strategy has been to promote service and efficiency and to attract all comers through low wait times, thus increasing the number of admissions through their emergency departments. More than any other hospitals, they need to be prepared for what lies ahead.

If they aren’t, the rules of the game are quickly going to change.

By Scott Regan, Chief Executive Officer, strategicplanningMD

There’s something amiss in the executive suites of many hospitals and health systems these days, and it’s having an impact on the brand strategy of organizations across the country.

Consider the type of person who rises to the top of healthcare administration, specifically in the positions of CEO, CFO, and COO. Generally speaking, these are business-savvy people with advanced degrees in business and finance, driven by numbers and spreadsheets, motivated by quarterly performance, and grounded in facts and figures.

Now consider the typical hospital service-oriented brand, anchored to patient satisfaction and clinical outcomes, propelled by its ability to emotionally connect with its customers and stakeholders, built on a foundation of trust and respect, focused on long-term performance rather than short-term bumps, and inspired to serve the greater community in which it exists.

Physicians and staff show up at the hospital or clinic every day because they are servant leaders who genuinely want to change the human condition, even if they can only affect that change one patient at a time. They are nurturers and healers. Hospital executives, on the other hand, show up because they want to build an organization that runs effectively and efficiently, can maintain reasonable operating margins, and can grab market share from competitors. They are big-game hunters.

Herein lies the cultural transformation paradox.

How do you build a brand that promises nurturing and healing when the parents of the brand (executive management) have bookshelves lined with such texts as, “The Art of War,” “Leadership Secrets of Attila the Hun,” “Executive Warfare,” “Jack Welch and the GE Way,” and “Thriving on Chaos”?

How do you successfully anchor your brand to trust and respect when so many hospitals still struggle with honest budgeting processes; respectful employee evaluation, promotion, and firing systems; and “flexible” medical staff policies that are often determined by the financial impact of the physician in question.

While these are certainly generalities, I can cite dozens of examples of organizations that manipulate budgets and “hide” dollars because senior leadership doesn’t trust middle management, or hospitals that have allowed managers to promote and fire staff improperly, or medical centers that turn a blind eye on the abusive and policy-violating surgeon simply because the organization cannot afford to lose the physician’s admissions.

It is rare for a hospital to build a sustainable brand under the above conditions. Usually, what happens is that the brand is unaffected for awhile, but like a child with abusive parents who eventually matures into an abusive adult, the brand eventually becomes the product of its upbringing. Or, if you’re lucky, or through effective strategic planning, leadership becomes enlightened by the masses who are marching in sync with the brand and begins marching with them.

Ultimately, one of two things happens to your corporate culture. Your brand changes to mirror your leadership team, despite your best efforts to prevent that from happening, or your leadership team changes to mirror your brand. While the former is usually unacceptable, the latter is often difficult. Changing the style of your leadership team first requires the team to recognize that they are an impediment to the brand, and then requires them to be willing to change. Depending on your executive management, both of these can be daunting.

It’s a paradox that can be solved, but it requires courage and wisdom to do so. But if your brand isn’t worth the fight, then what is?

By Scott Regan, Chief Executive Officer, strategicplanningMD

Where many organizations go wrong with strategic planning is at the very outset. They wander off blindly without spending time to discuss the primary focus of their strategic planning process. After all, the fundamental purpose of strategic planning is to align the vision-statements.php”title=”mission statements” >mission and the vision. Without mission and vision, the plan exists in a vacuum. And organizations that develop plans without considering mission and vision usually fail in their execution.

The value statements are also important to the strategic planning process as they provide a touchstone to the organization for how business decisions are made, and therefore what are acceptable strategies and tactics. Mission, vision, and value statements are clearly defined in strategicplanningMD, a revolutionary new application created specifically for healthcare organizations. Through this online strategic planning software, you can rest assured that you strategic plan is fully in sync with your mission, vision, and value statements.

Thus, even if your organization already has well-defined mission, vision, and value statements, you should review them throughout the strategic planning process.

And if such statements don’t exist, take the time to create them.

Goals, Objectives, Strategies, and Tactics

Goals, objectives, strategies, and tactics are the cornerstone of every strategic plan. They are the roadmap for growth and prosperity. They define what will be accomplished, by whom, and by when.\

By having focused goals, objectives, strategies, and tactics – coupled with a strong accountability system – your organization’s likelihood of success is enhanced.

It is important that everyone understand the terminology and can distinguish between the four strategic plan components.

Key Performance Indicators and Balanced Scorecards

Strategic plans acquire added depth when you attach key performance indicators and a balanced scorecard. While many organizations bypass this step, those that take the time to develop KPIs and a balanced scorecard discover the benefit of such an early-warning system.

KPIs and a balanced scorecard provide you with important performance metrics that allow you to gauge the overall health of the organization.

The strategic plan tells you where you are going; KPIs and the balanced scorecard tell you where you are right now.

By Scott Regan, Chief Executive Officer, strategicplanningMD

Recently, I was participating in an online discussion about aligning organizational brands with personal brands. At the heart of the debate was whether brand integration was even necessary. My response was based on two premises; if you don’t buy into my premises, you certainly won’t buy into my response.

• Premise 1: Everybody has a brand. It is more commonly known as your reputation. Your reputation and your brand are one and the same. And your reputation is largely based on your values.
• Premise 2: Corporate brands are, to a large degree, defined by vision of the the organization, as well as its values statements (the values that are truly lived within the organization, and not necessarily the ones that are hanging on the boardroom wall).

Thus, if both personal brands and corporate brands can trace their roots back to the values they subscribe to, then to maximize both personal and corporate performance, the values should be aligned, especially when it comes time to do strategic planning. As a former H.R. executive, I discovered that people who did not perform well and who were eventually fired, generally weren’t let go because they didn’t have the skills, ability, training, or intellect to do the job; they were let go because their personal values were out of sync with the values of the organization. Aligning personal and organizational values (and thus, aligning personal and organizational brands) generally yields tremendous results.

However, this kind of alignment requires that 1) you first know what your organizational values are, 2) that those values are well defined with behavioral expectations, and 3) that you hire, promote, and fire team members with those specific behavioral expectations in mind. I have found that hiring first for values (a.k.a. brand) and second for talent will usually yield better long-term results than hiring for talent first and values second.

But organizational brands and values sometimes change, one of the online discussion participants told me. When that happens, how do you align or realign the personal brands of people who, for many years, have been connected to the “old style and values”?

The answer to this question lies in the fundamental knowledge that brands and organizational values don’t change overnight. While we may want them to, they simply don’t. For instance, let’s say you work at a hospital that doesn’t know how to innovate, has never innovated, but has done very nicely simply by installing proven best practices and technologies. A new CEO walks in and states that innovation is now a heralded corporate strategy and that your hospital is going to be known worldwide as a great healthcare innovator. In fact, the CEO insists that the new brand is going to reflect innovation as well.

Come tomorrow, has anything really changed in your organization? No. The same people are coming to work, and these same people know as little about innovation today as they did yesterday. Although the CEO wants a brand and organizational value centered on innovation, it simply doesn’t happen, as the right people aren’t in the right jobs to make it happen. But hire enough innovative people and, over time, the value will be adopted and the brand will slowly change. And all those people who weren’t innovators to start with will either adapt or self-select out. But we’re talking about a year or two before this transformation really happens.

It is my belief that you can’t change your brand. You can, however, develop a brand strategy to change the things that can change your brand. Values is one of those things, but values require time to take hold.

By Scott Regan, Chief Executive Officer, strategicplanningMD

A great hospital brand is hard to find. In the last two weeks, I have been in several major markets, including Atlanta, Jacksonville, New York City, northern New Jersey, and Charlotte. And during that time, I came across many great hospitals, but not many great brands. Building a great hospital brand depends on knowing the right principles. Here are six brand strategy rules that are tried and true.

1. A great brand is in it for the long haul. I once worked for a hospital that had a great brand. Unfortunately, they thought the brand was impervious to bad short-term decision-making. They sacrificed the long-term brand for financial greed. A year afterward, the brand crumbled under the weight and the hospital lost $50 million. Three years later, this hospital is still trying to recover and their strategic planning is a mess.
2. A great brand can be anything. Any healthcare service is brandable, whether its an acute care hospital, outpatient surgery center, or alternative medicine clinic. Somewhere in the muddle is a frame of mind that’s unique. Despite the narrowness of healthcare services, the brand can still transcend these boundaries. But with healthcare so ubiquitous, it takes effort. How many hospitals are trying to brand themselves around patient satisfaction? Too many, if you ask me. It’s an old cliché, the price of entry into the game, and transcends nothing.
3. A great brand knows itself. To build a great brand, the brand first has to evolve. It has to understand what it is, what it isn’t, and what it stands for. You can’t build a brand through senior leadership consensus building. Because we don’t really create the brand inasmuch as we guide and control it. Experience also shows that whatever your execs think the brand is, is not what your customers think it is. You have to go out and measure the brand in your customers’ terms, find out what they like or dislike about the brand and what they associate as the very core of the brand concept.
4. A great brand taps into emotions. The common ground among hospitals that have built great brands is not just quality performance. Quality is an expectation every time a patient steps foot in your facility. It is a given. To spend too much time directly talking about it is a waste of your brand. Consumers live in an emotional world, and those emotions are escalated whenever healthcare is involved. Emotions drive our decisions. Thus, your brand has to have a powerful connecting experience that transcends the corporate culture of your organization.
5. A great brand is a story that’s never completely told. Your brand story is evolving all the time. It’s like a child maturing into adulthood, and it connects with something very deep. People have always needed to make sense of things at a higher level. We all want to think that we’re a piece of something bigger than ourselves. Hospitals that manifest that sensibility in their employees and consumers invoke something very powerful.
6. A great brand is relevant. A lot of hospital brands are trying to position themselves as “world-class.” More often than not, this strategy will fail. It’s dangerous if your only goal is to be the best, because being the best is relative, filled with hollow adjectives, and easily one-upped by your competitors. The larger idea is for a brand to be relevant. It meets what people want, and it performs the way people want it to. In the last decade, there’s been a lot of hype about hospital brands. A lot of propositions and promises were made and broken about how brands were positioned, how they performed, and what the hospital’s real value statements are. Consumers are looking for something that has lasting value. They want to trust that their decision to come to you was a good one.

* The principles stated in this blog are condensed and revised from a larger list first articulated by Scott Bedbury in a 2007 issue of Fast Company magazine.

By Robert Colvin, President, strategicplanningMD

We have talked for years about the high cost of healthcare in the United States versus the rest of the developed world. We spend 18 percent of our gross domestic product on healthcare while the average of all other major developed countries is approximately 11 percent – does that really matter? Yes, our clinical outcomes, overall, are poorer than in many of those same countries, and the quality and access variation across our population is the greatest of any developed country. So what? We have some of the world’s finest physicians, many of the best institutions, and much of the world’s leading research. We are fine – or are we? The short answer is no.

The rapid emergence of a truly global economy over the last generation has changed the game, and its impact on U.S. healthcare will also be game-changing. As we attempt to continue America’s world leadership, those extra dollars we spend on healthcare, relative to the rest of the world, will limit our growth and opportunities in so many of the areas we have been dominant for the last 50 years. No country spends more per capita on healthcare than the United States.

This is a red flag for the future of America’s competitiveness in the new global economy. With a national economy of $15.5 trillion, as a nation, we are overpaying at least $1 trillion annually for our healthcare. To put this in perspective, the entire U.S. military defense budget (which constitutes nearly 50 percent of all defense dollars spent in the world) is just under $600 billion. Or, to drive the point home even harder, $1 trillion is roughly what America spends on all public education, K through college – including all local, state, and federal dollars.

The real estate bubble of 2008 and the dot.com bubble of the 1990s both burst as the economic markets determined that exorbitant price levels were not supported by value. As the United States does what it must to maintain world economic leadership, deficit spending must be reduced and inefficient uses of valuable resources must be redirected to higher order pursuits. As an economy, we can no longer waste more than a trillion dollars annually paying for poor value healthcare while reducing early child education and college access for our citizens and while suffering with deteriorating roads, bridges, and schools. While a deflating health care bubble will be painful, American global competitiveness may depend on it.

What does this mean for strategic planning for U.S. health systems? It means that Medicaid and Medicare will be the tip of the spear for cost reduction. They alone make up nearly 24 percent of a federal budget that is presently 33 percent deficit funded and that total does not include state Medicaid matching dollars. Poor people have few advocates – Medicaid will be first. Medicare is gigantic and must be second. Health systems must plan for expanded numbers of individuals covered under these programs but with much lower “per unit” levels of reimbursement. We expect per-unit reimbursements for both of these programs will decline in excess of 20 percent over the next three to five years. In addition, many states will limit covered hospital days, arbitrarily increasing medically necessary but totally unfunded health services. Finally, we expect a serious assault on health system tax exemptions, as these also are low hanging fruit for politicians as they have relatively little ability for defense in the political process.

Bottom-line for successful health systems and physician groups of the future?

• Aggressive and focused cost reduction – 15 to 20 percent minimum
• Totally new and more strenuous operational benchmarks
• Transition of loosely affiliated holding companies to centralized operating companies
• Reduction of administrative layers
• Focused, delegated and monitored accountability
• More timely decision making
• Virtual strategic planning including alternate scenario analysis
• Capital conservation through partnerships and “make or buy” decisions
• Regional or national shared overhead services (I.T., referral lab, billing, etc.)
• Extensive use of physician extenders
• Empowered and engaged workforce

By Scott Regan, Chief Executive Officer, strategicplanningMD

Despite having rankings for everything imaginable in healthcare — patient satisfaction, core measures, best hospitals, best places to work, and more — the industry still hasn’t figured out how to measure and rank hospital brands. So, pending an accepted standard, we decided to tackle this on our own.

With all of the data that hospitals have at their disposal, much of it already used for strategic planning purposes, it’s not too difficult to measure your brand. If you subscribe to the notion that a hospital’s brand is largely experientially based, then there are many metrics that can help you illuminate the power of your brand.

Here is our list of brand indicators that deserve a watchful eye:

• Physician Satisfaction: If I had to select a single metric to correlate with brand power, I would choose physician satisfaction. If the physicians don’t like your hospital, they won’t refer or admit patients to your facility, and worse, they will tell patients who actually want to use your hospital exactly why they shouldn’t. What’s more, with so many hospital ranking surveys based, to some degree, on physician preferences, not having this group tightly aligned with you can spell brand disaster. Metric to watch: Overall physician satisfaction.
• Patient satisfaction: Ultimately, your brand hinges on patient satisfaction. The word-of-mouth advertising that results from a patient’s experience is more powerful than any TV spot, billboard, print ad, or direct mail piece that you can produce. Metric to watch: Overall patient satisfaction.
• CMS Likelihood to Recommend: This is the ultimate question in the CMS HCAHPS survey. More than likely, patients who are not willing to recommend your hospital are telling their friends and neighbors why they shouldn’t use your hospital. Metric to watch: Likelihood to recommend.
• Employee Satisfaction: The ability to turn your employees into brand ambassadors is a powerful strategy that has not been leveraged by many healthcare organizations. For a mid-sized hospital with 2,000 employees, their potential market reach is dramatic. And because they work for you, what they tell people about your hospital is taken as gospel. Unhappy employees who are bad-mouthing you away from the hospital can destroy brands faster than a couple of ill-advised Tiger Woods text messages. Metric to watch: Overall employee satisfaction.

So, if you take the four factors above (overall physician satisfaction, overall patient satisfaction, CMS likelihood to recommend, and overall employee satisfaction), all of which are on a 100-point scale, and multiply them together, you will get an indication of your brand strength.

For example, Hospital A has the following metrics: 72.6 overall physician satisfaction, 81.5 overall patient satisfaction, 67% likelihood to recommend, and 56.9 overall employee satisfaction. Multiply all four scores and divide the product by 1,000,000 (to convert the score back to a 100-point scale), and you discover that Hospital A’s brand strength is 22.6.

Comparatively, a hospital that scores 90 in each of the four categories would have a brand strength of 65.6, and one that scores 80 in each of the four categories would have a brand strength of 41.0.

While this might not be the perfect solution to rating and ranking hospital brands, it’s not a bad place to start.