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The Third Way: A Primer on Successful Organizational Transformations

Writer's picture: Bruce CummingsBruce Cummings

More evidence in support of using a team-based approach to improve operations, attract and retain staff, and reduce clinician burnout


Organizational Transformations

Are you considering undertaking or currently trying to lead a major transformation of your healthcare organization?  If so, you'll want to pay close attention to an important recent paper by McKinsey. In a December 9 article entitled "All About Teams: A New Approach to Organizational Transformation" co-authored by Arne Gast, Erik Mandersloot, Kai Grunewald, and Neil Pearse,  McKinsey recommends an approach that my colleague, Paul DeChant, MD, MBA, and I also favor; indeed, it is a centerpiece of what we routinely recommend to our clients:   


"Companies aiming for significant performance improvements may have tried top-down or bottom-up approaches to transformation—either relying on senior management alone or on programs that seek to change employee mindsets. But there is a third way. Our recent experience with organizations across industries and geographies reveals that a team-centric approach to transformation ushers in lasting, significant gains. Team-focused transformations can lead to 30 percent efficiency gains in organizations that implement these strategies effectively, McKinsey research shows. This is especially true when teams with cross-functional skills come together to achieve difficult outcomes."


McKinsey has found that organizational transformations are more likely to be successful -- and to be more perdurable -- if they are carried out by teams comprised of staff who are close to the actual work; and are appropriately empowered and supported by senior leadership (but not "controlled" by leaders); and then to spread that team-based, problem-focused approach area by area until eventually the entire organization is involved.   That's the concept.  But as we all know, not all teams are created equal or are equally effective.  Here, too, McKinsey provides valuable insight by identifying 4 conditions or practices that must be met to make this third way successful:


1. Identify the highest-value teams ("[I]t’s important to note that the teams most critical to creating future value may not exist yet; they must be created to address a real business need. These teams are highly likely to be cross-functional, with a specific customer group or product at their center. Identifying these highest-value teams requires leaders to think through all the dimensions and candidates with an open mind.") 


2. Activate the teams  ("Activating value-creating teams requires empowering them with a clear mandate, aligning them around clear outcomes, agreeing on how to execute together, and instilling practices for learning and feedback")


3. Lift the leaders to support their teams ("McKinsey research shows that change leaders should move beyond their traditional skills to those that inspire purpose, set medium-term strategy and long-term vision, and help remove obstacles—all while showing up as their authentic selves.")


4. Scale this approach to more and more teams  ("It’s important to think through several steps. These include how to move from the first round of prioritized teams to the next group, how to identify those new teams, and how to expand the pool of team coaches to support the larger group. Finally, widening this scope means figuring out how to measure and spread the story of success so that enthusiasm grows for new ways of working.")


As I mentioned, fostering team-based organizational transformation -- and helping senior leadership teams shift to this approach -- is one of the hallmarks of our consultancy.  Not only have we found that it is more effective than either typical top-down or bottom-up approaches, but it also is a powerful countermeasure to clinician burnout.  We know this because the 3 symptoms of burnout -- exhaustion, inefficacy, and cynicism -- result when knowledge workers in general and clinicians in particular no longer have a sense of agency.  This can arise variously because of --


  • Dealing with a surfeit of menial activities (e.g., entering data into the EHR and/or laboriously searching for data in the EHR; having to spend time in the EHR after-hours or on weekends to "catch up"; inadequate support staff or maldistribution of required tasks such that one cannot work at the top of one's license)

  • Having to meet various time-consuming administrative requirements that interfere with taking care of patients (e.g., obtaining prior authorizations, dealing with denials, attending to one's inbox, waiting weeks or months for responses from the "chain of command")

  • Exercising little or no control over one's work schedule or being unable to find an appropriate work-life balance 


Creating high-performing, engaged teams of front-line staff -- appropriately supported by leadership and oriented to/aligned with achieving key organizational goals -- will not only result in a more resilient and effective hospital or health system, it will also make one's organization a preferred setting for clinicians and clinical practice, too.


Solutions for Hospitals, Health Systems, and Medical Group Practices:  Leadership-Driven Changes


The locus for curing clinician burnout and staffing challenges runs through the C-suite.  Here are examples of leadership-driven changes to the workplace that my colleague Paul DeChant, MD, MBA and I often recommend:


> Regard clinicians as knowledge workers who are given significant latitude to make clinical decisions without unnecessary administrative encumbrances or delays


> Consistently apply one or more of the improvement sciences (Lean, Six Sigma, operations research, agile, design thinking) in consultation with front-line staff to improve workflow and reduce delays, waste, inefficiency, and job skill mismatches


> Expect all leaders, but especially senior executives, to do periodic job shadowing of front-line staff (where observing and deep listening are emphasized) in lieu of "rounding" (a largely ineffectual, if widely practiced activity)


> Create and require leader standard work (LSW).


> Develop and deploy a sophisticated, deeply ingrained, and rigorous daily management system (DMS) supported by visual display boards or monitors


> Judiciously invest in AI/ML solutions -- selected, tested, and endorsed by front-line staff -- that eliminate or at least markedly reduce data entry, administrative requirements, and/or repetitive tasks that are non-value add


> Support near-continuous optimization and remediation of the EHR (there's no such thing as "it's all set")


> Get rid of superfluous or outdated policies, procedures, redundant approvals, and other stupid stuff (GROSS)


Ready to transform your hospital or workplace?


Are you frustrated by mistrust or even adversarial relationships between front-line clinicians and senior leadership? Organizational Wellbeing Solutions was formed to enable senior leaders to identify the specific drivers of clinician burnout in their organization; and to support leaders in designing and executing a comprehensive plan to stop clinician burnout, increase retention, and improve operating results. A hallmark of our consultancy is correcting the all-too-frequent distrust and alienation Clinicians feel toward the C-Suite generally and the CEO in particular. Let us help you help your organization and its clinicians develop a more trusting, aligned, and productive working relationship.


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