“I know we can’t keep doing what we’re doing – but we’re not sure what to do….”
I’m paraphrasing, but this is a common theme of discussion among the leadership of many health and human service organizations. What are the drivers for the fundamental change in sustainability in the field? Just a quick look at recent headlines speaks to how the “basics” of a sustainable business model serving consumers with complex needs are changing:
- Home Care Minimum Wage & Overtime Rules To Move Ahead With Supreme Court Decision
- Comprehensive Child Welfare Information Systems Rules Change Previous SACWIS Parameters, Require Data Sharing & Allowing More State Customization
- Value-Based Reimbursement Models Used For Over Half Of Health Plan Payments
- 75% Of Massachusetts Behavioral Health Provider Organizations Had Losses Over $500,000 On Outpatient Services
- New York Non-Profits Providing Developmental Disability Services Report 23% Staff Turnover Rate
- New York Agrees To Redouble Efforts To Recoup Overpayments For Medicaid Mental Health Outpatient & Community Support Services From 2003 To 2012
- Michigan To Launch All-Payer Patient-Centered Medical Home Initiative In 2017
- Gregory Retreat Centers In Iowa Sues Wellmark Over Refusal To Pay For Pre-Authorized Addiction Treatment
- SAMHSA Issues 32 Behavioral Health Clinic Quality Measurement Tools & Data Reporting Template
- CMS Approves First Three State Plans For New HCBS Person-Centered Settings – Kentucky, Ohio & Tennessee
I don’t think coming up with new ideas for what to do is the difficult part. Our institutes this year have had great presentations by executives of organizations who have launched new programs that “fit” in the new market model – see ‘I’ve Demonstrated What Works’ – Now What?, Four Keys To Success With MCO Contracting, and Innovation In The I/DD Market Space.
The greater challenge is developing a market-oriented strategy to make those innovations financially viable – and then realigning your organization from its traditional business model to the new approach. With regard to making strategy a success, I was impressed with the four-action approach to organizational change management in a recent McKinsey & Company article, The Four Building Blocks Of Change. Most “change management” approaches are a little theoretical – so this action-oriented model appealed to me. The model suggests four important executive action items:
Build knowledge about why changes are needed across the organization – Most of us don’t change unless we have to. Team members at all levels should understand the external threats to “business as usual” that make changes necessary. (For more, check out Leaders Are Responsible For Their Own Morale and Getting Old Dogs Doing Those New Tricks.)
Create formal incentives (and penalties) for embracing change – If this sounds Pavlovian, that’s because it is. Shaping your team’s actions through incentives relies on a very simple premise – what you measure and reward is what gets done. This means clearly defining “the job;” recognizing the employees that are doing a good job and rewarding them; and for those employees who aren’t getting the job done, making changes to bring their performance in line with the organization’s goals. (For more, check out What Drives Your Performance Goals? and Performance, Productivity & Compensation: How To Maximize Staff Performance In An Era Of Change.)
Develop talent and skills needed for change – Executives, managers, and team members need to understand what is needed for future success, and then either develop those skills in the team or recruit new team members to add to the collective competencies. (For more, check out Competencies Without Culture A Fast Track To Failure and Defining Your Executives’ Critical Competencies.)
Be the role model – Last but not least, the executive team of the organization (starting with the CEO) needs to embody change. Actions do speak louder than words and in times of change, teams watch closely to see if the leadership is embracing the change ahead. (For more, check out Great Executives Need Communication Skills To Bring It “All Together” and When You Speak, Does Your Team Listen?.)
For more on navigating a changing landscape, check out these resources from the OPEN MINDS Industry Library:
- What Do Today’s Leaders Think About Managing Change?
- Creating and Leading A Team in Times of Change
- Don’t Just Sit There: Change!
- Managing Change as a Leader’s Challenge
- Managing at the Speed of Change: What Does It Take to Be Nimble?
And for even more, join Sharon Hicks and I on Tuesday, August 23 in San Diego for the launch of our new executive seminar, Reinventing Your Organization In A Complex Market: A Guide To Building A Sustainable, Performance-Driven Organization. Limited to just 50 executives, this seminar is a crash course in current best practices in long-term positioning, strategy development, and strategy execution – all the tools to get your organization from where it is to where you want it to be in the years ahead.