Yesterday, I shared my three big takeaways from this week’s 2017 OPEN MINDS Best Practices Institute (see The 3 Market Challenges We Aren’t Prepared For). Today, I want to focus on how executive teams of provider organizations can prepare for these challenges by focusing on sustainability.
In my closing keynote session at the institute, Reinventing Your Organization In A Complex Market: A Guide To Building A Sustainable, Performance-Driven Organization, I discussed the six core management practices for sustainability that are the focus of our senior advisor team at OPEN MINDS. These are the guideposts for executive teams that are concerned about finding that sustainable future in a changing market.
Strategy development – Most importantly, executive teams must able to build a strategy that optimizes performance in the current market, while also planning for both future scenarios and the transition to new market positioning. Management teams need to create a “lean” base of current operations in order to thrive in the future.
Organizational evolution with emerging technology – Now more than ever, success in the present and the future is dependent on adopting existing and emerging technology. The future health and human service system is heading toward “any time, any place, continuous, and personalized care.”
Rapid cycle innovation – The ability to develop new services quickly and inexpensively is more important than ever in a market that is increasingly competitive and changes rapidly. Good ideas are not enough. Your team needs to be able to manage many new strategic initiatives simultaneously and be ready to move to scale, or fail fast and cheap.
Creation of a sustainable financial model with reimbursement tied to “value” – In the future, there will be very few markets in health and human services that are not tied to value. This transition is happening at many levels. We’ve written a lot about health plan purchasing changes (see What Health Plans Are Looking For? Hint: It’s Not A Bigger Provider Network) and pay-for-success initiatives (see Pay-For-Success Takes Aim At Child Services and Managed Care Comes To Social Services – Some Advice From The Field). There is a growing direct-to-consumer cash market and corporate purchase of services, both of which require a strategy for competitive advantage. And even government agency purchase of services is moving to more performance guarantees (see From An Extension Of Government Policy To Competitive Service Providers – The Strategy Evolution For Non-Profit Executives). That means that every organization needs a strategy for sustainable service delivery that is tied to value and can compete on the basic elements of the value equation (see Value-Based Reimbursement: 3 Steps To Go From Idea To Action) over time.
Metrics-based performance management – The implementation of strategy, which is dependent on innovation, technology adoption, and competition based on value, depends on the ability of executive teams to manage based on information. To do this is a two-step process. First, select the most critical performance metrics that align to strategy. Second, and most importantly, develop a competency and a culture to use them as a routine part of organizational strategy management.
Leadership with the ability to manage complexity – As most managers know, both the market and this new management model are complex. A successful leader in this new market needs to manage this complexity, with both operational (transactional) leadership skills to keep order and efficiency and their entrepreneurial (transformational) leadership skills to adapt to the many market changes. And, unique to the health and human service market, executives also need meta-leadership skills to manage collaboration in the broader value chain and ethical leadership that respects the rights of others in that process.
The path to organizational stability and sustainability as the market changes is not a simple one. Good on-going market intelligence is the baseline for navigating the changes. And organizations need the tools and the talent to chart a new course – with assumptions that there will be many detours along the way.
To build your team’s talent, I hope you’ll join me for “Best Practice Meta-Leadership: A Framework For Leadership Effectiveness” and “Creating An Ethical Environment: Best Practices In Building A Culture Of Ethics” at our 2017 OPEN MINDS Executive Leadership Retreat in Gettysburg, Pennsylvania in September. And, be sure to check out our archived coverage of The 2017 OPEN MINDS Management Best Practices Institute on Twitter @openmindscircle – #OMBestPractices.