Strong Leadership and Teamwork Drive Culture and Performance Change: Ohio State University Medical Center 2000-2006
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Academic Health Centers
Strong Leadership and Teamwork Drive
Culture and Performance Change: Ohio State
University Medical Center 2000 –2006
Fred Sanfilippo, MD, PhD, Neeli Bendapudi, PhD, Anthony Rucci, PhD,
and Leonard Schlesinger, DBA
Abstract
Several characteristics of academic health OSUMC’s academic, clinical, and and functions, (5) engaging constituents,
centers have the potential to create high financial performance. (6) developing leadership skills, and (7)
levels of internal conflict and misalignment defining strategies and tracking goals.
that can pose significant leadership To achieve this goal, the senior vice
challenges. president and his team employed the The OSUMC setting during this period
service value chain model of improving provides an observational case study to
In September 2000, the positions of Ohio performance, based on the premise examine how these stepwise changes,
State University (OSU) senior vice president that leadership behavior/culture drives instituted by strong leadership and
for health sciences, dean of the medical employee engagement/satisfaction, teamwork, were able to make and
school, and the newly created position of leading to customer satisfaction and implement sound decisions that drove
chief executive officer of the OSU Medical improved organizational performance. substantial and measurable improvements in
Center (OSUMC) were combined under a Implementing this approach was a the engagement and satisfaction of faculty
single leader to oversee the OSUMC. This seven-step process: (1) selecting the and staff; the satisfaction of students and
mandate from the president and trustees right leadership team, (2) assessing the patients; and academic, clinical, and
was modeled after top institutions with challenges and opportunities, (3) setting financial performance.
similar structures. The leader who assumed expectations for performance and
the role was tasked with improving leadership behavior, (4) aligning structures Acad Med. 2008; 83:845–854.
T his report examines a successful high levels of internal conflict and values with the medical school versus
attempt to improve performance at misalignment of missions and resources clinical programs and business values with
OSUMC by changing organizational that can pose significant leadership the hospital and faculty practices
culture. With the addition of a strong challenges. exacerbates these cross-mission program
new leader, OSUMC saw a measurable conflicts with additional cross-
difference in its organizational structure, AHCs have a complex—and often organizational and cross-cultural ones.
function, and expectations. This difference internally competitive— organizational
resulted in improved performance structure. Each spans a medical school, A final factor making AHCs difficult to lead
according to a number of important hospital(s), and faculty practice plan(s) is the “free agent” nature of the highly
measures, including patient, student, and, respectively, the academic, business, specialized faculty who provide education,
and employee satisfaction; external and and professional service cultures of each. research, and patient-care services in
objective reputational survey rankings; The relationship among these components disciplinary and interdisciplinary units of
and financial performance (Table 1). frequently changes, and new leadership of departments and centers. Similarly,
any component usually causes a shift in nonfaculty staff providing professional
power and authority alignments across (e.g., nursing, pharmacy), technical (e.g.,
The Challenges the entire organization. laboratory, imaging), and administrative
Challenges in academic health centers The components of the AHC perform a (e.g., marketing, operations) services are
Academic health centers (AHCs) are range of diverse activities, including in increasingly short supply relative to
complex and challenging organizations, education, research, patient care, and demand. Overseeing a highly skilled
especially with regard to leadership, community service. Competition for professional and service workforce that is
management, and performance. Several resources and priority are often as difficult mobile and that requires substantial
factors, including AHCs’ organizational to resolve among programs across missions infrastructural support is a significant
structure, mission diversity, and highly (e.g., cancer research versus cardiovascular challenge for leaders with responsibility
specialized professional and service surgery) as programs within any one overseeing the units (e.g., departments,
workforces, have the potential to create mission area (e.g., cancer research versus centers, schools, hospitals) and programs
cardiovascular research). It is difficult to (e.g., education, research, clinical) that
compare costs with benefits when benefits comprise the functional components of
are so dependent on academic value AHCs.
Please see the end of this article for information
about the authors. judgments of impact and recognition rather
than just the business values of financial Challenges of service organizations
Correspondence should be addressed to Dr.
Sanfilippo, 1440 Clifton Road NE, Suite 400, Atlanta, return and market position. The relative “Customers” of AHCs, especially
GA 30322; e-mail: (fred.sanfilippo@emory.edu). association of academic programs and students and patients, receive services
Academic Medicine, Vol. 83, No. 9 / September 2008 845Academic Health Centers
rather than acquire tangible assets. This
Table 1 leads to a different set of management
Changes in Leadership Culture, Employee Satisfaction, Customer Satisfaction, imperatives when dealing with employees
and Performance at Ohio State University Medical Center, 2000 –2006* than one might expect in a traditional,
2000–2001 2005–2006 consumer-driven model centered around
a manufactured product.1
Leadership culture (behavior norms; percentile)
.........................................................................................................................................................................................................
Types
......................................................................................................................................................................................................... First, AHC leadership must motivate
Constructive 29% 62%
......................................................................................................................................................................................................... faculty and staff to present a positive face
Passive–defensive 66% 52%
......................................................................................................................................................................................................... of the organization to students, patients,
Styles
......................................................................................................................................................................................................... volunteers, the public, and others they
Avoidance 91% 61%†
......................................................................................................................................................................................................... serve. A customer who enjoys a particular
Achievement 28% 74%† product may find it relatively easy to
.........................................................................................................................................................................................................
Affiliative 20% 44%‡ assess the quality of the product
.........................................................................................................................................................................................................
Self-actualizing 23% 59%† independently of quality perceptions
.........................................................................................................................................................................................................
Humanistic–encouraging 44% 71%‡ about a surly clerk who makes the sale;
Employee satisfaction
.........................................................................................................................................................................................................
this is more difficult to do when assessing
Staff
.........................................................................................................................................................................................................
the quality of a lecture provided by an
High satisfaction 66% 76%† uninspired teacher or of the care
.........................................................................................................................................................................................................
Residents
.........................................................................................................................................................................................................
provided by an inattentive physician.
High satisfaction 46% 57% This is because the intangible benefits
Customer satisfaction accrued by the student or patient who
.........................................................................................................................................................................................................
Patients receives services at an AHC are often
.........................................................................................................................................................................................................
High satisfaction (9–10 rating) 65.8% 77.1% personified by the individual who
.........................................................................................................................................................................................................
Occupancy rate (average/year) 637 805 provides them.
.........................................................................................................................................................................................................
Total patient admissions 40,423 54,314
.........................................................................................................................................................................................................
Local market share 22.7% 26.4% Second, AHC leadership must reduce real
.........................................................................................................................................................................................................
Students or perceived inconsistencies in the quality
......................................................................................................................................................................................................... of services delivered by different providers.
Satisfaction (% favorable) 90.5% 98.1%
......................................................................................................................................................................................................... When a product rolls off a production line,
Applicants (% total national pool) 8.9% 10.9%
......................................................................................................................................................................................................... management is usually able to set up strict
Acceptance rate 13.3% 9.3%
......................................................................................................................................................................................................... quality controls to reduce the variance of
Matriculation rate: in state 62% 67%
......................................................................................................................................................................................................... important attributes. In an academic or
Matriculation rate: out of state 31% 45%
......................................................................................................................................................................................................... clinical setting, it is much more difficult to
Entering class average MCAT score 30.8 32.8
......................................................................................................................................................................................................... ensure that every faculty and staff member
Community
......................................................................................................................................................................................................... is uniformly engaged and capable.
Employment 7,608 11,350
Performance Third, AHC leadership must ensure that
.........................................................................................................................................................................................................
Academic faculty and staff possess interpersonal as
.........................................................................................................................................................................................................
U.S. News & World Report (USN&WR) medical school 44 32 well as technical skills. Employees who
rank: overall
......................................................................................................................................................................................................... manufacture products can be hired for
USN&WR medical school rank: objective 42 23
......................................................................................................................................................................................................... their technical skill with less regard to their
USN&WR medical school rank: reputation 44 30
......................................................................................................................................................................................................... personality and behavior. In providing
Sponsored research effectiveness (total funding/sf $253/sf $371/sf
research space)
academic and clinical services, however,
......................................................................................................................................................................................................... leaders must emphasize the interpersonal
Total research funding $80.6 million $184.4 million
......................................................................................................................................................................................................... skills of faculty and staff, because most
Total research funding rank 46 25
......................................................................................................................................................................................................... students and patients will use this as a
Clinical
......................................................................................................................................................................................................... proxy for the technical skills that they are
USN&WR hospital rank 35 20
......................................................................................................................................................................................................... unable to judge.2
USN&WR number of top programs 6 10
.........................................................................................................................................................................................................
UHC ranking NA 5
......................................................................................................................................................................................................... Finally, AHC leadership must manage the
Financial
......................................................................................................................................................................................................... demand for and supply of their highly
Revenue $548 million $1,215 million
......................................................................................................................................................................................................... talented workforce. Unsold products can
Operating margin ⫺$10.5% 6.4%
......................................................................................................................................................................................................... be discounted in an effort to get rid of
Operating cash (⫺$53 million) $25 million
......................................................................................................................................................................................................... inventory, but the unused time of a
Cash reserves $45 million $124 million service provider is gone forever. Because
* Leadership culture, employee satisfaction, and customer satisfaction data are based on OCI surveys conducted in the ability to manage the time and
2001, 2003, 2004, and 2006; similar external surveys of faculty and staff conducted in 2002 and in 2005; and number of tenured faculty is especially
an ongoing Press Ganey Associates survey of patient satisfaction. See text for details.
†
P ⬍ .001. difficult, program planning and
‡
P ⬍ .01. forecasting become critical.
846 Academic Medicine, Vol. 83, No. 9 / September 2008Academic Health Centers
Leadership challenges in professional Finally, leaders must manage the inherent staff, and students; about one million
services performance ambiguity of professional patient visits per year; and more than
Professional services like academic services that, in fact, are really “credence” $1.6 billion in revenue. It includes the
medicine involve certification by external services.4 This is because it is difficult to college of medicine, two general and four
bodies of professional staff (e.g., determine whether the service provided specialty hospitals, and a clinical practice
physicians, nurses, technologists) and was the best among all possible options, plan of more than 700 faculty.
their delivery organizations (e.g., medical even after the service is performed (e.g.,
schools, hospitals) to be eligible to serve could the educator have given a better In September 2000, a new leader began
customers such as students and patients. lecture, or could the clinician have serving as the OSUMC senior VP, a new
Leaders in professional service settings, provided a more effective treatment?). position that combined the previous
such as department chairs, center Academic and clinical leaders must positions of senior VP for health sciences
directors, deans, and vice presidents accept that, realistically, they can neither and dean of the Ohio State University
(VPs), work with a talented labor force completely control the input (i.e., define (OSU) College of Medicine with a new
quite distinct from the frontline exactly what the faculty/staff member position of chief executive officer (CEO)
employees generally associated with the should do in a specific situation) nor of the OSUMC. This position was
nonprofessional services setting. comprehensively evaluate the output (i.e., developed by the president and trustees
did the faculty and/or staff member during the previous two years to better
For example, professional service leaders provide the best service possible?). align the components of the OSUMC and
must accept the dual loyalties most AHC to provide a single point of leadership.
The complexity of AHCs as professional This was in response to declines in
faculty and many service staff have to service organizations provides a significant
their careers as well as to their employer. medical school rankings and hospital
set of management and performance financial performance, and to a mandate
Although they depend on their employer challenges. When a need for change is
to provide the leadership and support to from the president and trustees to
identified in such an organization, improve OSUMC’s academic, clinical,
which they are entitled as employees of executing this change becomes all the
an AHC, professionals tend to identify and financial performance.
more challenging. One approach to drive
with their own career and to be loyal to performance change in such a setting is
the standards and mores set by their The service profit chain5,6,7 (Figure 2)
to create a set of leadership behavioral posits that leadership behavior drives
professional bodies.3 Thus, faculty or staff expectations and norms (i.e., organizational
members may be active in their national employee engagement, which, in turn,
culture) that is constructive and that impacts customer satisfaction and results
professional associations or specialty stresses high performance. It is equally
societies and find these affiliations more in improved performance and outcomes.
important that leaders recognize and deal This model of interdependence guided
important to their identity than the with any attitudes and behaviors that
responsibilities conferred by their OSUMC’s approach to the institutional
impede the overall mission of the changes that were required. The period
department or service unit. This dichotomy organization.
is intensified by the significant time from September 2000 to August 2007 at
commitment involved in getting and OSUMC provides an observational case
maintaining professional certification, Culture, Structure, and study to examine how a purposeful series
which may be required by an employer but Performance Changes at OSUMC: of seven steps (List 1) to change leadership
obtained through a specialty society. 2000 –2006 culture, as well as organizational structure,
function, and expectations, was able
Background to improve (1) the engagement and
AHC leaders also must accept that faculty
and professional staff are usually the final OSUMC is one of the largest AHCs in the satisfaction of faculty and staff, (2) the
arbiters of their own daily activities. In country, with more than 13,000 faculty, satisfaction of students, patients, and
many professional services, the employee
usually has the knowledge and expertise
to respond directly to the needs of the
customer. This is particularly true in
academic medicine, where the specific
knowledge and skill of the educator,
researcher, and care provider often
determine the course of action in real
time at the point of service. Moreover,
the lead professional sets the tone and
guides a team that operates under her or
his orders (e.g., the course leader for the
lecturers, the research lab director for the
students in the lab, the surgeon for the
operating room team, or the department Figure 1 The service value chain illustrates that leadership behavior influences employee
chair for the faculty). The leader must, engagement/satisfaction, which, in turn, affects customer satisfaction and organizational performance.
therefore, carefully navigate egos and Source: Adapted from Heskett JL, Sasser WE, Schlesinger LA. The Service Profit Chain: How Leading
expectations and lead by influence rather Companies Link Profit and Growth to Loyalty, Satisfaction, and Value. New York, NY: Simon &
than edict. Schuster; 1997.
Academic Medicine, Vol. 83, No. 9 / September 2008 847Academic Health Centers
employees, and (3) academic, clinical,
and financial performance.
Step one: Selecting a leadership team
One of the earliest and most important
steps the senior VP took to address the
issues and opportunities facing OSUMC
was to appoint a small executive
leadership team to provide input and
oversee strategic and tactical decision
making across all aspects of the center.
Six of the eight positions on this team
were newly created and were intended to
align the center’s mission and administrative
activities. The six new positions were
associate VPs (AVPs) (also with
responsibility as vice deans) for the
mission areas of education, research,
and patient care, as well as a chief
communications officer, chief planning
officer, and chief operating/financial
officer (COO/CFO). The CEO of the
OSU Health System and director of the
OSU Comprehensive Cancer Center were
also appointed as members.
Figure 2 Ohio State University Medical Center (OSUMC) vision for the future. This graphic was
The AVPs charged with overseeing each first introduced by the OSUMC senior vice president in his January 2001 State of the Medical
Center address and was used subsequently in the next five annual addresses to articulate clear
of the mission areas were selected on the
expectations for OSUMC. The important association of mission, vision, and values with
basis of their demonstrated leadership organizational performance has been well examined.
and stature; each was a sitting chair of a
major department, which provided these
new positions an instant level of credibility
and influence. To assist in their new part- List 1
time responsibilities as AVPs, each Seven Steps in the Culture/Performance Transformation of Ohio State University
worked with several part-time associate Medical Center, 2000 –2006
and assistant deans to help them perform 1. Select a leadership team.
the range of activities under their
• Appoint a small executive leadership team to provide input and oversee strategic and tactical
oversight. These included associate deans decision-making.
of basic, translational, and clinical research; • Appoint members from both functional (academic, clinical) units and support (administrative)
surgical, medical, hospital-based, and units.
primary care services; and each of several 2. Assess the challenges and opportunities.
education programs. Two of the • Objectively evaluate organizational culture.
administrative leaders (communications,
• Solicit formal and informal input to gauge organizational structure, function, and
planning) also were well established and performance.
were recognized as effective sitting
3. Set expectations.
directors in the OSU Health System.
• Establish and clearly communicate a shared vision.
The value of this new leadership team • Expect a high degree of collaboration within and among units.
was significant, especially because seven 4. Align structures and functions.
of the members were already highly • Align medical school, practice plans, and hospital functional units.
trusted, respected members of the • Align education, research, and clinical service missions.
OSUMC community. Their counsel • Align support services across the center.
provided the senior VP an excellent 5. Engage constituents.
means to learn and understand issues, • Make faculty and staff feel like part of the center at large—not just their own units.
challenges, and opportunities and helped
• Engage external constituents in driving culture and performance change.
him communicate more effectively with
6. Develop leadership.
faculty and staff. The eighth member (the
• Offer leadership retreats and educational programs around specific leadership themes.
COO/CFO) was a highly respected
community business leader and the • Implement “360” leadership scorecards and mentoring to evaluate and enhance performance.
sitting chair of the board of the affiliated 7. Define strategy and track goals.
Columbus Children’s Hospital. This • Create a workplace of choice by encouraging a high-performance culture.
appointment helped the leadership team • Establish objective criteria and standards for measuring successful performance.
848 Academic Medicine, Vol. 83, No. 9 / September 2008Academic Health Centers
understand and communicate with other organizational goals. Defensive cultures Organizational structure, function, and
community leaders. Although this newly may be either passive (where employees performance. The academic, clinical, and
formed executive leadership team was diminish success through avoidance, administrative leaders throughout the
expanded in 2003, and the roles and conformity, rigidity, and lack of university, as well as external advisors in
responsibilities of some of the team members accountability) or aggressive (where academic medicine, management, and
changed during this period, all six members employees are highly competitive, to the leadership, offered formal and informal
in newly appointed positions on the original detriment of the team, and short-term input to assess the organizational
team were still members through the gains are valued over long-term success). structure and function of OSUMC. The
period of this report (2007). The results of the survey showed a consistent observation was that the whole
challenging picture. Compared with was much less than the sum of the parts
Step two: Assessing the challenges and of OSUMC, because its multiple
opportunities reference organizations, the senior
leadership survey of actual behavior organizational units were not structurally
Evaluating the current situation and norms put OSUMC in the 28th percentile aligned (often competing rather than
potential directions for improvement was collaborating), and its missions of
for constructive culture, the 66th
a critical early step in the process of education, research, and patient care
percentile for passive/defensive culture,
improving culture and performance. were not functionally aligned with each
and the 64th percentile for aggressive–
Although the most visible issues were in other, the organizational units, or the
defensive culture. Moreover, the
academic, clinical, and fiscal performance, faculty and staff.
the concerns of many leaders and the behavioral norm was low in excellence,
senior VP’s initial observations suggested teamwork, and innovation styles (below The units’ lack of alignment with each
that there were two root causes the 30th percentile in each dimension) other was most pronounced for the
underlying these manifestations: the and high on avoidance (above the 90th faculty practice plans, which comprised
organizational culture and its structure. percentile). Fortunately, the ideal culture 33 separate independent corporations, of
desired by the same senior leadership which 29 were for profit. Very few of the
Organizational culture. To take a more group was, in contrast, highly constructive, practice plans retained earnings for
objective view of the organizational culture, with scores high (⬎90th percentile) in future investment or provided financial
the senior VP commissioned a survey excellence, innovation, and teamwork, and support to the research or educational
to collect quantitative data of the low (⬍10th percentile) in avoidance. missions of OSUMC. For most, all year-
organization’s leadership culture. The end earnings were distributed in salary.
purpose of the survey was threefold: (1) to The external assessors noted an extremely In a few clinical departments, the chair
determine the “current” leadership dominant, passive–avoidant culture that was not the head of the practice plan,
culture relative to benchmarks of high- promoted avoidance of risk, controversy, and, in some cases, the practices were in
performance organizations, (2) to identify timely decision making, and accountability. direct competition with each other and
the differences with the “ideal” behavioral In particular, the emphasis was on with hospitals in the OSU Health System.
norm desired by the leadership team, and process rather than outcome, and In some cases, there was direct competition
(3) to provide a baseline assessment to authority was diffused throughout the among the hospitals themselves. The
assess progress. organization in committees and processes poor financial status of the OSU Health
that often required unanimous consent. System in FY00 was felt to have a significant
A well-established survey instrument
Thus, it was difficult to make any effect on OSUMC’s performance and culture
(Organizational Culture Inventory,
decision at all, let alone in a timely problems; an operating loss of $58M was
Human Synergistics, Inc.)8 was
manner, because everyone effectively had posted for FY00, and the deficit in
administered in February 2001 by
a veto. This process reinforced a culture operating cash ($53M) was greater than all
Human Synergistics through an external
of passive avoidance and weak leadership cash reserves ($45M). Technically, OSUMC
process to ensure anonymity to all 113
was insolvent.
senior leaders surveyed. The surveyed because it was hard for any individual to
group included all leaders who oversaw make a decision and be held accountable.
Business interaction among the practices,
functional units of education, patient
hospitals, and medical school focused on
care, and research, as well as directors of The results of the culture inventory were
shifting costs and/or revenue rather than
administrative and support service units interpreted and messaged as good news,
on creating value through partnerships.
across all parts of OSUMC. With a 100% because the desired constructive culture In some cases, transactions by individual
response rate, the survey quantified three was strongly associated with high practice plans or hospitals would
types of organizational culture and performance and “workplace of choice” generate revenue for their own unit that
each of 12 behavioral norms against organizations, and there was so much was less than what could have been
benchmarks of other organizations. A upside potential in closing the gap gained by the entire enterprise. Such
second, identical survey was administered between actual and ideal. By eliciting win–lose scenarios were considered
simultaneously to identify the ideal participation through an independent acceptable and a normal part of the
culture desired by the same leaders and to third party with a standardized competitive environment. In many cases,
quantify the differences between their assessment tool, it was easier to secure discretionary resources and even
ideal culture and actual behavior norms
engagement of the senior leadership operating funds were allocated on an ad
of OSUMC.
to help change their own culture hoc basis, without a plan for their use or
Constructive cultures promote excellence, (behavioral norms) from what it was to benefit, and often with no written
innovation, and teamwork in achieving what they actually desired. agreements to document commitments.
Academic Medicine, Vol. 83, No. 9 / September 2008 849Academic Health Centers
It was apparent that the dominant relationships. Each organizational unit four department chairs (surgery, internal
leadership culture of avoiding risk, would be expected to demonstrate medicine, pathology, family medicine) to
controversy, timely decision making, and significant engagement and commitment work with the other chairs to align all of
accountability provided a significant to each mission area, which was in the practice plans with each other and
challenge for change. This was coupled contrast to the low academic interest of with the medical school and health
with the organizational, structural, and the clinical practice and hospital system. Many similar attempts had been
functional issues of an AHC that was a enterprises and the low clinical made unsuccessfully during the prior 25
loose affiliation of competitive private orientation of the medical school. A years. In this case, however, the clinical
practices and community hospitals matrix diagram was used repeatedly to chairs and newly appointed COO/CFO
associated with a medical school—all describe how each mission area should succeeded within two years in merging
with leaders who had limited authority. align with each component of OSUMC. more than 30 independent companies
into a newly created, university-affiliated
Step three: Setting expectations Units and their leaders were expected to entity, OSU Physicians, Inc. (OSUP), a
The next step toward addressing develop win–win relationships and to nonprofit corporation whose service
organizational performance at OSUMC prioritize those activities that had benefits mission was to benefit OSU. This success
was to articulate clear expectations for for the entire organization and across was largely the result of the trust in the
the entire organization and for individual missions, rather than just their own unit department chairs who led this effort
units and their leaders. This was or self-interests. Resource allocation and the expertise of the COO/CFO in
accomplished broadly with the senior would be based on overall mission corporate mergers. To enhance mission
VP’s first State of the Medical Center priorities, and recognition, rewards, and and organizational alignments, each
address in January 2001, shortly after his incentives would be based on mission- clinical department in the medical school
arrival. In an opening slide (used related achievements. had a corresponding limited liability
repeatedly in his five subsequent annual company (LLC) within OSUP (which was
addresses), he diagrammed the “Vision Expectations were also set to change the the sole member of each LLC), each
for OSUMC” as a pyramid with three organizational “values/culture” from department chair was made director of
tiers of expectations (Figure 1). The top passive–avoidant to constructive by the corresponding practice plan LLC, and
tier, “Mission—Balance and synergy,” encouraging values of teamwork, malpractice coverage was combined with
was supported by a middle tier of innovation, and excellence. Leaders were that of the OSU Health System. The impact
“Alignment—Organizational structures, expected to become proactive rather than of these alignments was substantial and
resources, recognition” on a base of passive–avoidant by being actively almost immediately reduced overall
“Values/Culture—Teamwork, engaged in issues rather than just expenses for OSUMC (especially for
innovation, excellence.” The important showing support for others who were malpractice coverage) and increased
association of mission, vision, and values engaged. The senior VP explicitly revenue (especially for provider contracts).
with organizational performance has expected leaders to make occasional,
been well examined.9,10 “well-intentioned, well-informed” errors For the medical school, organizational
by trying to be innovative and decisive alignment among departments and
Each tier was described repeatedly in rather than simply avoiding risks or centers occurred within the first year
many venues during the succeeding decision making. He proposed to through a common budgeting process. In
months and years. The goal of improve culture, service, and financial addition, a task force of department and
“Mission—Balance and synergy” was to performance by growing revenue faster center leaders, led by the executive AVP,
increase the priority and amount of than expense through investment in reviewed and developed the relationships
research at OSUMC to be in balance with high-performing people and programs, among departments and centers. The task
the education and patient-care missions, rather than the more common tactic of force completed a white paper within a
and to close a major gap in performance turning around a financially failing year, outlining the expected structural
and reemerge as a top-tier AHC. The enterprise by cutting expenses and and functional alignments. The
synergies among research, education, and focusing on work process improvement. university-owned hospitals were more
patient care at aspirational peer AHCs were tightly coordinated as a health system
used to demonstrate how each mission Step four: Aligning structures and under a single CEO and aligned with the
could contribute to the excellence of the functions practice plans and medical school to
others and to the overall performance of To promote the desired expectations in create a more unified OSUMC.
the organization. The message was that to organizational culture and performance,
improve its performance, OSUMC needed substantial changes in structure, Support services. To align and enhance
to function as a true AHC, rather than function, and relationships were put in internal communications throughout the
as a community-practice type of clinical place across OSUMC within and among enterprise, and to provide a consistent
enterprise that was simply associated with the academic and clinical functional and coordinated external message,
a medical school. service units and support services. communication was the first administrative
function aligned across the entire center.
“Alignment” included expectations of a Functional units. The first and most This meant coordinating all the disparate
high degree of collaboration among and important organizational alignment communications offices in the hospitals,
within each organizational component involved the faculty practice plans. college units, and practice plans into one,
(medical school, hospitals, practice plans) Within the first month of arrival, the center-wide support service that was
in contrast to the existing competitive senior VP charged a leadership group of decentralized enough to meet the needs of
850 Academic Medicine, Vol. 83, No. 9 / September 2008Academic Health Centers
each local unit, while at the same time Step five: Engaging constituents the organization. In expressing their
demonstrating a true sense of ownership One of the earliest challenges was vision, leaders must pay special attention
and responsiveness, creating a centralized engaging internal and external to the language that motivates their
level of accountability, and developing a constituents to help drive needed changes people. In an AHC populated by highly
common brand for the organization’s in culture, organizational structure, and trained physicians and scientists, it is
disparate entities. function. Achieving the desired important for leaders to use the language
improvements required active and norms of science and to be viewed as
In parallel, the leaders had to facilitate participation from many diverse groups, genuine and authentic.12 Thus, the senior
communication and exchange of including OSUMC leadership, faculty VP discussed the challenges facing
information among groups. A unified and staff employees, and external OSUMC in terms of his own research and
medical center could not become a reality constituents, such as alumni and clinical background in immunogenetics,
as long as information systems did not community leaders. One key to securing pathology, and physics.
allow groups to have one shared view of engagement and support across these
the customer or to exchange information groups was to develop a clear, coordinated He repeatedly used the immunogenetics
in a relatively cost-free fashion. Thus, message tailored to their specific analogy of the relationship between
another early process was to align several perspectives,11 as well as appropriate structure and function. Translated to the
separate information systems and their incentives, expectations, and rewards. leadership challenge, it meant that
management teams across the hospitals, organizational structures needed to be
practice plans, and medical school into Internal constituents. Leaders needed to modified to fit the functions that were
an OSUMC-wide enterprise, again with feel they were part of OSUMC as a whole desired. From pathology, he expressed
central accountability and decentralized (not only their own academic, clinical, or the importance of leaders not just
services. business units) to extend this expectation focusing on the symptoms of a problem
to faculty and staff in their units. Leaders but, rather, identifying, understanding,
To accomplish this, an enterprise were asked to assess the organization of and treating underlying root causes (the
informatics advisory board (EIAB) of their divisions and departments in the basic disease) to achieve a sustained and
executive level mission leaders was context of services provided to students, effective solution. His background in
appointed by the senior VP to oversee all patients, employees, volunteers, and the physics informed another metaphor he
community, as well as what needed to be used to describe two strong and ever-
information technology projects
done to improve financial performance. present challenges: inertia and entropy.
spanning research, education, and patient
The formal hierarchies and informal Inertia, the propensity of a body to resist
care. Likewise, an academic department
pecking orders which had developed change of its current state, extends to
of biomedical informatics was created in
among teachers, practitioners, human behavior as well. People must
the School of Medicine in 2001 to house
researchers, and administrators had to be have a significant reason to change their
faculty engaged in the development of
surmounted to encourage dialogue and current state, which is why resistance to
information systems and technology to
develop collaboration across missions change is so high. Entropy is the
enhance quality and performance across
and units. Extensive communication inevitable and steady dissipation and
the OSUMC enterprise. diffusion of energy, which—as with
plans were developed and launched
throughout the organization to break organizations—requires that energy must
Each of the other support services that be constantly applied in an effective way
down walls among the unit-level silos
previously had been distributed, and were to retain focus and direction. Senior
and to create awareness and pride in the
often competitive or duplicative, were leaders were asked to change and to focus
organization as a whole and in each of its
also brought into aligned, shared-service on building the constructive culture they
missions. These included a variety of new
models; these included operations, fiscal, themselves desired.
print and electronic publications targeted
strategy planning, human resources,
to specific employee groups as well as
facilities, legal, fundraising, and Within six months of his arrival, the
faculty and staff across OSUMC. In
government affairs. Within a year, senior VP held his first medical center
addition, numerous interdisciplinary and
OSUMC-wide positions were created, leadership retreat with the culture
interorganizational programs and centers
including a chief communications officer, were created to align activities across survey participants to discuss how they
COO/CFO, and chief strategy planning missions and functional units. might overcome inertia by creating
officer to align the decentralized services. organizational structures and processes
This was achieved largely by consolidating To enhance faculty and staff engagement that would facilitate changes in behavior,
some of the unit-based leadership broadly, it was also necessary for the communication, and performance. How
positions; in several cases, the OSUMC leadership to be transparent in discussing to maintain a long-term focus on the
support service leader also served as the stated goals and the plans for achieving imperative of culture change driven by
leader of one of the major organizational them. To accomplish this, the senior VP the discontent with the organization’s
units. The process was largely one of and senior leaders met with individual units culture and performance was the focus of
realignment and reassignment of and held regular OSUMC-wide retreats, another of the 13 subsequent retreats
responsibilities; after five years, an internal town hall meetings, and an annual State of held during the next five years. These
report demonstrated essentially no net the Medical Center update. retreats were an important vehicle for
increase in overall senior administrative engaging leadership right from the start.
positions, even though OSUMC as a whole One of the most significant roles that Each had breakout sessions so that every
had doubled in budget. leaders play is to articulate the vision for participant could provide feedback on the
Academic Medicine, Vol. 83, No. 9 / September 2008 851Academic Health Centers
specific discussion topic, and each retreat senior functional and support unit The benefits of the Leadership Academy
theme was developed on the basis of leaders included regular leadership were readily apparent. First, by working
input from the participants and followed retreats, a Leadership Academy, internal as a team, emphasis was placed on the
up on the next steps identified at the feedback, and external coaching. shared identity of leaders as members of
previous retreat. OSUMC rather than solely as representatives
The 15 leadership retreats held between of their particular academic, clinical service,
Another key to success was providing February 2001 and March 2007 focused or administrative unit. Second, the leadership
incentives for the leadership to act as a on specific leadership themes with team gained administrative and management
team in the best interest of the external speakers. Guest speakers knowledge from experts. Third, the
organization13,14 and expanding authority included well-known authors such as Phil participants learned to accept the limits
to allow for greater accountability. Harkins,11 Ian Morrison,15 and Frank of their professional knowledge and to
Motivation required that all leaders, LaFasto13,14; academic business school adopt the role of students rather than
whether academic, clinical, or experts such as Jay Barney,16 Roy teachers. Being in the role of trainee
administrative, be seen expressing the Lewicki,17 Neeli Bendapudi,1,2,18 and allowed the leadership team to be more
behaviors desired because they were David Greenberger19; business leaders comfortable with accepting new ideas
expected to be both role models and change such as Len Schlesinger,5,7 Anthony and advice.
drivers. A wide range of incentives and Rucci,6 and Robert Walter (CEO, chair,
rewards for achieving desired performance and founder, Cardinal Health); academic Another early and effective approach to
and leadership were developed, including clinical practice expert Mark Keroack20; leadership development was implementing
budget, space, personnel, and compensation and well-known local experts on a “360” leadership scorecard to both evaluate
benefits. Reciprocally, disincentives were teamwork such as Andy Geiger (athletic and enhance leadership performance. The
instituted for poor performance involving director) and Jim Tressel (head football scorecard was developed to assess (1)
the same resource levers. Budgets were coach). values—mapped to the constructive culture
changed, space and personnel were styles of teamwork, excellence, innovation,
These retreats provided significant and integrity, (2) administrative
reassigned, and salaries were restructured to education and development of the
allow for incentives and disincentives to be competence— communication; use of
leadership team on a regular basis by personnel, space, and funds; strategic
provided more easily. focusing on topics such as change thinking; mentoring; and management
management, organizational culture, skills, and (3) change management—
External constituents. Engaging several
service value, competitive advantage, involvement in, enthusiasm for, and time
external constituents was critical in
customer service, employee management, commitment to change.
driving the culture and performance
strategic priorities, teamwork,
change of OSUMC. Most noteworthy was
innovation, performance excellence, Each senior leader was invited to suggest
the creation of an informal Strategic
trust, and leadership development. peers, supervisors, and direct reports as
Planning Group (SPG) composed of a
reviewers; those who were ultimately
small group of experts, university and A second approach to leadership selected remained anonymous to ensure
community leaders invited by the senior development was the creation of a objectivity. Both the individual and
VP to advise the executive team. This Leadership Academy with the Fisher aggregate evaluations of leadership
group met with leadership almost College of Business. Developed to performance using this tool helped set
monthly and provided significant insight, specifically address the leadership team expectations in changing culture and
expertise, and feedback on strategic, needs of OSUMC as assessed by an performance. In several cases, external
tactical, and technical issues brought external review and planning sessions, the coaches mentored and assisted motivated
before them. Two of the members (A.R., Leadership Academy consisted of several leaders who were having difficulties in
L.S.) led executive team retreats, and modules: strategy, finance, organizational meeting performance or behavior
most of the members also became performance/design, leadership, culture/ expectations. Nevertheless, despite these
engaged in other important activities of trust, strategic planning, team building, various efforts, several leadership changes
great benefit to OSUMC. communications, performance management, were necessary. In some cases, the leader
change, and metrics. Ninety-six OSUMC was supportive of needed changes but not
An important perspective provided by leaders, including the executive team, went proactively engaged in making them
the SPG was the importance of defining through the Leadership Academy, which happen; in others, the leader was
and articulating the value and benefit to was first offered in April 2002. Additional unable or unwilling to respond to the
the local community and other external leadership development modules were expectations of performance; and, in
constituents if OSUMC reached its goals offered subsequently, using the Health Care others, the leader’s desire for control and/
through culture and performance change. Advisory Board (The Advisory Board Co., or autonomy was to the detriment of the
This proved to be very effective in Washington, DC). The Leadership organization. Replacing some ineffective
broadening the support and engagement Academy was held in three successive or unresponsive leaders and bringing in
of other external constituents, especially sections of six months’ duration, with one new leaders from high-performing
alumni, patients, local leaders, and third of the leaders in each session. The organizations both clearly had significant
volunteers. most senior leaders (including the executive benefits in accelerating the organization’s
team) participated in the first session, and change in culture and performance.
Step six: Developing leadership the positive response of the first group was
Approaches to developing and improving an incentive for participation by others in The fundamental challenge of leadership
the leadership and management skills of the two subsequent sessions. development was to get leaders to think,
852 Academic Medicine, Vol. 83, No. 9 / September 2008You can also read
