Compaq. EF Hutton and Paine Webber. Eastern Air Lines and Pan American World Airways. F. W. Woolworth Company. Blockbuster. Sears. Barnes & Noble.
What do these organizations have in common? They were victims (or almost victims) of disruptors in their field.
Surviving disruptors was the theme this morning of my keynote address,The Changing Market Landscape For Behavioral Health Services: Strategies To Compete With The New Disruptors, at the MHCA Annual Fall Conference here in Austin, Texas.
So, in the health and human service field, who are the disruptors that are causing so much angst in the board rooms and executive team meetings of traditional health and human service providers? They are the emerging national specialty organizations. They are the multi-functional morphing health systems. They are the virtual delivery systems, the backward integrating health plans, and the retail health care offerings. They are the joint ventures between unusual combinations of stakeholders.
During today’s session, we looked at both the drivers of change in the field and how these synergistic developments are changing the sustainable models for therapy (see The ‘Melting’ Value Chain) and primary care (see The Primary Care Reinvention). At the same time, the full effects of the tech-enabled workforce are starting to be felt (see Workforce Problems? Technology As Strategy). The effects on the sustainability of traditional provider organizations is starting to be more and more apparent.
The question for executive teams is how to reinvent your organization’s service lines and assure long-term sustainability. The “solution” is different for every organization—depending on their specialty, consumer segment, payer sources, geography, competition, and more. But through our team’s work with a wide array of specialty provider organizations, I’ve found that the organizations that are more likely to succeed do share some common management competencies. This is my hit list of the most important of those competencies:
“Best practice” strategy development and sustainability-driven innovation
It all starts with strategy, that shared vision of the organization in the future, and the measurable objectives for achieving that vision, that drive investments in new service lines, technology, and more. For successful strategy in a disruptive market, the key is to let the strategy drive the innovation. A good rule of thumb—fewer and faster is better than many and longer (see Building & Executing Strategy In A Complex Market-A Three-Phase Best Practice Model For Success and Innovation Success In Three Steps).
The health and human service field is moving from dominance of broad generalist organizations that do a wide range of services on a transactional basis, to a discrete “productized” service lines that offer a specific solution for a specific fee. To thrive in this changing market, adaptive standardization is key. Services need to be delivered in a consistent fashion for similar groups of consumers, using standardized clinical protocols, structured workflows and consumer interfaces, and standard performance measures. Adaptive standardization is essential for competing on consumer experience and in performance-based reimbursement models (see ‘Productizing’ Services For Competitive Success and Adaptable Standardization-In Service Of Mission?).
Market-responsive service line evolution
Health and human services have a shorter and shorter product life cycle and need on-going reinvention of those services in response to both competitive offerings and changing customer preference. The ability to bring up new services and reinvent current services quickly is key (see New Service Line Development: The OPEN MINDS Step-By-Step Approach To Developing Innovative Programs and Make Change Or Be Changed).
Nimble tech adoption and deployment
The ability to rapidly assess, adopt (or not) and deploy technology are parallel skills to nimble service line evolution. The key for most successful new services is to focus on performance and use technology to improve the service value proposition (see Add ‘Speed’ To Your Treatment Tech Planning List and Your Digital Tech Integration Checklist).
Metrics-informed performance management
From strategy, to process improvement, to nimble service line evolution and tech deployment—none of these activities can be done well without metrics to manage performance. If an executive team can’t measure organizational performance and identify performance problems, no current operations, service lines, or contracting can deliver performance that can keep up with the disruptors (see Failure To Launch and Can Success With Value-Based Reimbursement Happen Without Analytics?
Structure and team to manage complexity
Last, but not least, executives need to create a structure to balance continued current operations with entrepreneurial development and develop a leadership team that can manage complexity. The drivers in the field were previously complicated but linear. The current market is increasing complex—policy, demographics, regulation, technology, and more are synergistic and demand more nuanced strategies and management practices (see Coping With Increasing Management Complexity and The ‘Melting’ Value Chain).
These core capabilities don’t assure organizational success in the face of the many new disruptor organizations in the field-but they up the odds. To help prepare your executive team’s ability to beat the disruptive competition, mark your calendars now for our 2019 executive seminar series, including:
- How To Develop a Strategic Plan: An OPEN MINDS Executive Seminar On Best Practices in Strategy, Portfolio Management, & Scenario-Based Planning at The 2019 OPEN MINDS Strategy & Innovation Institute in New Orleans, Louisiana on June 4
- How To Develop A New Service Line: An OPEN MINDS Seminar On Diversification Strategies, Feasibility Analysis, & Successful New Service Development at The 2019 OPEN MINDS Executive Leadership Retreat in Gettysburg, Pennsylvania on September 10
- Succeeding With Value-Based Reimbursement: An OPEN MINDS Executive Seminar On Organizational Competencies & Management Best Practices For Value-Based Contracting at The 2019 OPEN MINDS Strategy & Innovation Institute in New Orleans, Louisiana on June 5
Elite OPEN MINDS Circle members have five passes to each of these seminars—to learn more about becoming an Elite member, stop by our booth at the mhca meeting this week, or learn more online. And, mark your calendar for September 10-12, 2019 and plan to bring your executive team to our 2019 OPEN MINDS Executive Leadership Retreat, held every year in Historic Gettysburg, Pennsylvania.