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Health Strategy & CE LHIN1
Larry Chester
Symposium Objectives2
Provide an opportunity for networking and learning as planning partners continue to implement the priorities identified in the Integrated Health Services Plan (IHSP) and prepare to align shared activities for continued implementation in the coming year. The goal is to share information on activities to date and further equip health service provider leadership (governance, administration and clinical), planning partner volunteers and priority project teams with additional tools and information for continued success.
Project Management
Doing the project rightDoing the right projectThe right project is often defined as the one that best advances your strategy
3
Definitions3
Management is doing things right; leadership is doing the right thingsLeaders make change happen; managers do everything elseStrategy is What you want to become (and why), not How you will do it
Competency Hierarchy
Technical skillsAction planning
Problem solvingDecision making
Situation Assessment
Environmental scanningIssues management
Strategy formulationStrategic deployment
Individual contributor
Manager/ supervisor
Senior manager
Communicating with othersConflict and collaboration
Performance management
Project Management
Strategy implementationLeadership and involvement
Transition 1
Transition 2
Strategy Asks The Big Questions
Where is this organization going?What customers will we serve?What products or services will we offer?What are our priorities over the next five years?What is our value proposition?What competencies must we possess or acquire?How will we position ourselves in the health care field?What is our business concept?
OH-6
6
So that everyone pulls in the same direction!
Why do we need a strategy?
Michael Porter’s View8
The organization without a strategy is willing to try anythingThe essence of strategy is choosing what not to doStrategy must have continuity. It cannot be constantly changing
9
STRATEGY(WHAT)
PROCESS(HOW)
CULTURE(HOW)
Leadership Thinking
10
WHATLow Clarity & Commitment
High Clarity & Commitment
HOW
High Efficiency & Effectiveness
Low Efficiency & Effectiveness
1
3
2
4
Will deliver its
mandate
May deliver the wrong mandate
too quickly
Needs to develop delivery
processes quickly
Will fail to meet their mandate
We need a clear strategy well delivered
OH-11
Strategy
Future StateCurrent State
InitiativesProjects
ProcessesPerformance
Change
The acid test: Is strategy clear enough to see where projects, processes, and people fit?
Scan
Decisions support strategy9
It’s about daily decisions by managers and individual contributors in CE LHIN and its partners in delivery
Is my decision aligned
with strategy?
Opportunities
•Hiring someone
•Building a hospital
•Implementing a program No
Cancel
YesProceed
10
CE LHIN Strategy
Alignment in your organization11
How well are our decisions aligned?
Very confident that they are
Believe that they are
Believe that they are not
Very confident that they are not
Don’t know
Executive level
Very confident that they are
Believe that they are
Believe that they are not
Very confident that they are not
Don’t know
Middle Management
Key Issues in Developing Understanding…12
Because executives don’t say what they mean or test the assumptions they really hold. (This) inhibits a resolution of the important intellectual issues embedded in the strategy.
Chris Argyris, Harvard Business Review, Sept/Oct, 1986
Senior managers at consistently excellent companies such as Emerson and GE seem to be able to question each other’s assumptions without undermining each other’s confidence or authority.
“Survey of Management,” The Economist, March 9-15, 2002
Deployment ProcessesOH-16
How well do your deployment processes enable the questioning of strategic assumptions?
Very confident that they do
Believe that they do
Believe that they do not
Very confident that they do not
Don’t know
The SolutionOH-17
We need a process and tools that involve:Participation by all, in groupsEveryone pools knowledge and asks questions in “low stakes” mode, where assumptions can be questionedCommon understanding of the big picture as basis for defining goals, plan, projects, etc. for groups and individualsEasy communication within and between groups
Current deployment processesOH-18
How well do your current processes enable:
Very confident that they do
Believe that they do
Believe that they do not
Very confident that they do not
Don’t know
Widespread Participation
Very confident that they do
Believe that they do
Believe that they do not
Very confident that they do not
Don’t knowPooled Knowledge
Very confident that they do
Believe that they do
Believe that they do not
Very confident that they do not
Don’t knowCommon Understanding
Dilbert’s View
Communications-friendly?OH-20
How easy is it to communicate your current strategy to others?
Very confident that it is
Believe that it is Believe that it is not
Very confident that it is not
Don’t know
Balanced ScorecardOH-21
Kaplan and Norton Book (Early ’90s)Depends on vision/strategyFinancial and non-financial Key Performance Areas (K.P.A.s)Six K.P.As (financial, customer, process, innovation, learning , employee)Objectives and 3-5 key performance indicators (K.P.I.s) per K.P.A.Balance leading (early warning) vs. lagging (outcome) indicatorsAlignment, planning and evaluation
OH-22
Example: Balanced Scorecard
INNOVATION LEARNING
PEOPLEPROCESS
CUSTOMER
• Transaction database integrity/scope
• Complete, correct, on-time product delivery
• Documented and signed off customer cost savings (technical, supply management
• Customer project implementation
• Mutual value creation (suppliers)
• Cost of each core processes• Improvement status each
core process
Finance rapid growth and maintain a strong balance sheet
Innovate a stream of customer inspired products, services and processes
Foster employee satisfaction and performance excellence
Acquire the right knowledge and skills, continuously and cost effectively
Build, execute, and improve processes for customer value and performance
Provide superior customer value and performance and win market share
• Customer relationship and knowledge
• Segment revenue growth• Account share
• Customer satisfaction
• Employee satisfaction survey and follow-up
• Turnover/retention• Competency level progress
• Employee productivity
• Progress against skill development plans
• Market knowledge/skill sharing (via database)
• Internal best practice sharing (via database)
• Revenue growth• Asset management• Profit
• Company investment in trials, tests, experiments of new products/processes
• Number of new products/processes introduced per year
• Average speed to market/cost of new products/processes
FINANCIAL
Strategy MapOH-23
Visual, group-oriented technique
Developed on flipchart paper with post-it notes
Links all six Key Performance Areas together
Clarifies our thinking and builds consensus
Identifies issues and unanswered questions
Starts with the ”customer,” fills in other KPAs, and makes connections (what drives what)
Strategy Map – Key Performance AreasOH-24
•Financial:What are the desired financial outcomes that will enable our organization to resource our growth at low risk?
•Customer:What are our customer segments, what are their requirements and what is our value proposition to each of them? How will each segment contribute to achieving the financial outcomes?
•Process:What are our core business processes and how does each one play its part in delivering the value proposition to each segment?
•Innovation:What are the innovation systems that we use to create new products, services, and processes to render existing ones obsolete. How do these support the core processes?
•Learning:What are the systems that we use to ensure that the organization is learning by capturing, and leveraging knowledge and acquiring new strategic skills and technologies? What is the linkage between this learning and innovation and process execution.
•People:What is the contribution that we expect from our people and what is our commitment to them? What is the linkage between this and learning, innovation and core process execution?
Veterans AdministrationOH-25
InnovationOH-26
Innovation is the process of creating something so new and different that it renders OBSOLETE comparable processes, products, or services.
3 types of innovationOperational excellence (process, cost focus)Increase customer value (product, customer focus)Build the franchise (partnership, capability focus)
Sony ExampleOH-27
Operational ExcellenceManagement structure redesignManufacturing consolidationStreamline media content production
Increase Customer ValueCreate next big product (walkman, play station…?)Avoid enabling content piracy
Build the FranchiseCreate and manage alliances to enable leverage of Sony technologyEnhance Sony brand image
Economist March 1st, 2003
InnovationOH-28
Innovation structures, systems and skills are needed forGetting the organization to think about innovation on an ongoing basisCreating a culture of, open questioning of why and how things are doneTesting of breakthrough ideas under conditions as close to future reality as possible.Implementing the changes needed to make the new idea successful
Innovation – Mobil (North America ) M.A.R. example
OH-29
Build the Franchise
•Enhance brand image
•Increase understanding of customer segments
Increase Customer Value
•Best-in class retail support teams
•Increase number of new value added products
Achieve Operational Excellence
•Industry cost leadership
•Improve hardware performance
•Improve inventory management
•Environmental health and safety
Innovation Your Organization
OH-30
Build the Franchise
Increase Customer Value
Achieve Operational Excellence
FinancialOH-31
Managerial accounting systems are the resource allocation and evaluation mechanism of the business
The choice of financial measures and the period over which they are optimized is a key decision the knowledge of results is only a measure of past performance,being organized to anticipate or at least react to future events is critical
LearningOH-32
“Learning is a strategic choice; it doesn’t just happen. Learning is a capability. It requires skills. It requires processes and it requires leaders who value it.”
Judy Rosenblum from:
Will Companies Ever Learn
OH-33
We need to identifyCritical skills neededCompanywide methodologies/disciplines neededLeadership behaviour
Learning
OH-34
The people most likely to be successful have a sense of personal responsibility and accountabilitySee the best route to personal security and professional growth as skill enhancement and developmentAre willing and able to embrace changeShare the common values and attitudes of the organization
Contribution Expected From People
Commitment to People OH-35
Our people are integral and indispensable part of our ability to add value to customersrequire ongoing education and trainingneed interactive communication with co-workers, customers, and suppliers to continuously update their skills and sense of missionwill have personal growth opportunities
PeopleOH-36
“ The motivator factors that are intrinsic to the job are: achievement, recognition for achievement, the work itself, responsibility and growth or advancement”
Frederick Herzberg from:
One more time: How Do You Motivate Employees?
Leadership & Strategic Planning
OH-37 1. MOBILIZE CHANGE THROUGH EXECUTIVE LEADERSHIP
• MOBILIZATION• GOVERNANCE PROCESS• STRATEGIC MANAGEMENT
2. TRANSLATE STRATEGYINTO OPERATING TERMS
• STRATEGY MAPS• BALANCED SCORECARDS
3. ALIGN ORGANIZATION WITH STRATEGY
• CORPORATE ROLE• BUSINESS UNIT SYNERGIES• SUPPORT UNIT SYNERGIES
4. LINK STRATEGY TOEVERYONE’S JOB
• STRATEGIC AWARENESS• PERSONAL SCORECARD• BALANCED PAYCHEQUES
5. MAKE FORMULATINGSTRATEGY A CONTINUALPROCESS
• LINK BUDGETS & STRATEGY• STRATEGIC LEARNING• ANALYTICS & INFORMATION
SYSTEMS
InnovationLearning
Customer Financial
BALANCED SCORECARD
Process
People
Final Measurement of Strategy
However beautiful the strategy, you should occasionally look at the results
Winston Churchill
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