A Note On Applying Jim Collin’s Great By Choice To The Healthcare Industry

On Sunday I had the opportunity to attend a presentation by Jim Collins (best-selling author with titles including Good to Great, Built to Last, Great by Choice, etc.) at this year’s HFMA annual conference. This being my second time hearing Mr. Collins apply his theories on building and sustaining “great” businesses, I was able to hone in on the finer details of his lecture. In dissecting the application of his theses to healthcare, I was, for the most part, as impressed with the universality of his premises as I was the first time I heard him speak at the AHA annual conference last year. That said, there was one point that Mr. Collins made that caused me to throw a challenge flag (at least in my head since he was not fielding questions Sunday evening).

The statement that Mr. Collins made that caused me heartburn was related to his story about Southwest Airlines and their relationship with Pacific Southwest Airlines (PSA). In general, Mr. Collins explained how Southwest Airlines, for the most part, established its company by photocopying PSA’s values, business plan and procedures manual. For a period of time, both organizations were highly successful in their respective markets but then a period of hyper-change occurred in the airline industry. At this point, Mr. Collins differentiated the two airlines by their response to this period of hyper-change. While PSA radically changed its business model to accommodate the new environment, Southwest stayed true to eighty percent of its historical strategy. What Mr. Collins noted was that in most cases, organizations that made minor changes to their business plans, like Southwest, tended to remain “great” in and following periods of turbulence in their industries.

What Mr. Collins did not emphasize was that this principal only holds true to organizations that are “great” going into the period of hyper-change. For example, “great” healthcare organizations like Mayo, Geisinger, and Kaiser Permanente will be more likely to remain “great” in an era of accountable care if they stay true to their core principals and make minor modifications to their strategies in order to remain within regulatory compliance. On the other hand, the average hospital or health system should be prepared to overhaul their delivery system if they hope to thrive let alone survive in value-based industry. The average hospital should never abandon their core purpose of keeping people healthy and returning their patients back to health but the survivors are more likely to be the organizations that change eighty percent of their current strategy (i.e. population health, outpatient care, etc.) as opposed to twenty percent (i.e. adoption of an EHR).-Dr. John S. Redding

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