Course Project Draft

A Transformation in Health Care
HR587ON – Managing Organizational Change
Professor: John Anderson

Table of Contents

Executive Summary Page 3
Assessment/Diagnosis Page 4
Analysis of Change Strategy Page 5
Results/Outcomes Page 9
Evaluation of the Effort Page 10
References Page 13 A Transformation in Health Care
This diagnostic paper is based on my current experiences in my organization of a significant change initiative. I will be providing a high-level summary of key changes within my current organization, the reasons for the change, approaches taken, and current outcomes of the change.
In the course project paper I hope to provide valuable input of lessons learned and incorporate key concepts and strategies learned in the course that can be implemented to help future change initiatives within an organization.
Executive Summary
They may not raise the dead but Resurrection Health Care (Res) does help people get back on their feet. The organization is Chicago’s largest Catholic health care system. Res consist of six acute care hospitals, eight long-term care and rehabilitation facilities, a home health care company, a dozen of outpatient facilities, and community ambulatory clinics. The organization specializes in services for Cancer treatment, pediatrics, cardiac care, and oncology. The organization also operates six retirement communities. Res is currently in talks to merge with Provena Health which is another Catholic health care system equal in every way. The organization is sponsored by the Sisters of the Holy Family of Nazareth and the Sisters of the Resurrection.
Res is currently going through a huge transformation through the introduction of technology. Res is taking full advantage of the government stimulus programs designed to reimburse organizations financially if they implement an electronic health system (EHR) and show meaningful use. The organization is looking to create profits through the use of technology, eliminate paper, provide the highest patient quality care, patient satisfaction, physician and medical staff satisfaction, increase patient safety, integrate information to form one source for patient data, and become competitive technology wise with other health care organizations. The challenges and issues are that the EHR involves every department, every person, changes workflow, changes patient care, and introduces technology to people who are not technology literate. The other major issue is having people adapt to this new technology. As a Project Manager in the Information Services department it is my job to oversee these projects and ensure the changes are accepted and implemented successfully. This paper will provide an education viewpoint based on the ability to identify the change, analyze the change, diagnose the change, strategize and plan for the change, communicate the change, implement the change, and finally evaluate the change.
Assessment/Diagnosis
Mostly due to a bad economy Res was losing in every business category there was and if this continued, the entire business was in jeopardy of closing its doors and selling its organization to its competitors. The current CEO Sandra Bruce was brought in to right the sinking ship. Her resume is long and extensive demonstrating the skills necessary to turn the organization around. Her resume includes several CEO positions where she has strengthened the organization by focusing on physicians and technology, which she has done with large health care organizations in Idaho and Michigan. Sandra Bruce’s first order of operation is to determine what the issues are. She brought in a consulting group to perform a gap analysis to determine Resurrection’s current status, Resurrections goals, and how to achieve those goals.
With the help of the consulting firms a complete gap analysis determines key areas that needed improvement. The first area was that Res was overstaffed in numerous departments, the second is that Res provided services that were more expensive to do internally that was more affordable by outsourcing (i.e. laundry services), the third was related to point of sale because not all health related charges were being captured, fourth was old legacy technology that was expensive to maintain and support and did little for integration and efficiency, fifth was a low affiliated physician base that was referring patients to resurrection for health care services, sixth is that the organization was losing so much money that its credit rating dropped so Res was paying a higher interest rate and no more loans was being afforded, and finally sixth was the current goal and emphasis of the prior CEO was to grow by purchasing hospitals and properties (created a huge deficit when the real estate market crashed).
Analysis of the Change Strategy
The Burke-Litwin Model was identified and used by the consulting company to pinpoint the change required. Transformational changes were seen from different angles and sources such as external environment which pinpointed to the bad economy, mission and strategy which highlighted the wrong growth strategy by purchasing real estate and hospitals, leadership which resulted in bad decision making with personnel, and organizational culture which led to being laid back when it came to the organization’s technology and integration.
Well now that all of the issues have been identified through the analysis as the root cause of the organization’s poor performance, the organization can begin to brainstorm on how to remedy the situation. If the assessment and analysis are the first two steps in the change process then strategizing and creating a vision to guide the organization are the next steps to follow.
Cutbacks and downsizing were the first two strategies as there were massive layoffs and personnel cuts made to alleviate the overstaffing. The following strategy was to close down certain areas in the hospitals where cost savings can be quick such as laundry services as outsourcing is to be considered. The next strategy is to sell the two hospitals as identified as the worst performing and least profitable.
The next strategy is to change or organization by making it attractive to everyone with the introduction of technology that would integrate systems and link both health care practices and patients together. This strategy would resolve a few issues such as now having a system that can assist with detail billing and capture all charges applicable, attract talented and skilled physicians and staff that would be an ideal work environment, increase patient safety, increase quality, and increase health care participation by the patient.
The last strategy was to make physicians the focus of the health care organization. Allow physicians to make decisions on the organization, provide the tools that the physicians want and need for patient care, and primarily make them the focus of the organization. The thought process here is that physicians are now engaged to the organization and will provide business through referrals and attract quality physicians that patients are always looking for.
The Res CEO, Sandra Bruce played her cards right by being objective and distant from the solutions she wanted to implement. The game plan was to let the consulting firm hired to perform the gap analysis provide the strategy, vision, and required changes and then she would make her push after the leadership presentation. The consulting firm placed charts and diagrams on the current status of the organization and where the organization was headed if not changes were made. The consulting firm then provided strategies, vision, and the solutions to create the required change which showed a more different desired outcome than the current status. The favoritism to change came from the top of the organization and created an excitement level throughout the organization.
There was such urgency to immediate start implementing change that not enough emphasis was placed on preparation or planning for resistance. All knew resistance was certainty and many people who were excited about the changes to strengthen their own organization suddenly joined the group of people who would raise the most resistance to the upcoming changes. When the first wave of layoffs occurred people were threatened that their jobs were no longer secure. This increased as two hospitals were sold with little communications. Trust became a factor in these scenarios.
A change such as an EHR affects everyone such as physicians, patients, technology staff, financial people, management, and more. So a technology change of this magnitude will definitely have numerous impacts. The first is “Resistance to Change” which is largely cultural, employee support, training, and lack of computer skills. People have the “Why should we change when things are working just fine” attitude. The second is financial constraints and although you can apply for government grants and funding you first need to dish out your own money to implement the change. There is a huge cost associated to help transition the project aside from the hardware and software itself such as training, marketing, consultants, and hiring qualified talent. The third is time which is creating a huge impact as the organization is trying to meet all the government deadlines while shortening and being aggressive to the internal project timelines. This is creating a strained and stressful environment as people are overworked and working on several projects at once in a compressed time. Lastly, the feeling of fear is replacing the feeling of excitement as people are realizing that their jobs are changing and they might potentially lose their jobs due to not being computer literate or being replaced by a computer.

Momentum for Change was Built and Sustained
Management and leadership continued to plan and work on implementing the changes quickly before the internal resistance sustained its own momentum and interfered with the changes being implemented. Soon after a few phases of layoffs, cutbacks, and the selling of a few hospitals the EHR came into play. The CEO, Sandra Bruce was taking full advantage of the government programs to continue the push for change and to solve the issue identified and the need for a more updated and integrated technology within the organization. There was no way that the EHR would cause any resistance, after all, this would be a mandate by the federal government. All of a sudden with the wave of layoffs and the selling of a few hospitals the financial figures came out and the first year of Sandra Bruce the organization had broke even where in the past the organization sustained huge losses. Now every accomplishment was being communicated and advertised through internal marketing fortifying the decisions made for change. And among that communication was that strengthen the organization now secured jobs for those still in the organization. And with the EHR more jobs were created with higher pay scales.
With the EHR project Deloitte Consulting was brought in to continue the sustained growth and to monitor the organization’s success. More meetings were being held, more forums, more communication on the financial aspects of the organization, and more tools created to keep everyone in the loop. Through e-mails, departments were receiving PowerPoint presentations on all the positives the changes were creating along with financial reports showing the company was headed in the right direction. Department managers created monthly meetings where they would have the opportunity to communicate changes and the current state of the organization. These meetings also provided an opportunity for people to ask questions. Other tools such as a SharePoint Collaboration site where financial reports demonstrated goals were being achieved.
Results/Outcomes
Based on communications from CEO Sandra Bruce, it was made clear that the objectives were critical for the organization in order for the organization to survive. Year one was slated as a work in progress but the goal was to achieve a break even financial go. This was achieved by the cutbacks, layoffs, and the selling of the two hospitals. The organizations credit rating now decreased which was an expected outcome. Resistance to change was an outcome that was not expected or foreseen by management and leadership.
By years two and three CEO Sandra Bruce wanted EHR implementations on all of the critical areas (Acute, Ambulatory, and Private Practice). All of these projects were done together and overlapping one another. The expected outcome was to have 30 ambulatory sites, 1 hospital, and 200 Private Practice sites. Successful outcomes were only 25 ambulatory sites, 1 hospital, and three Private Practice sites. This is a huge accomplishment in itself although it did not meet the goals. There were several items that were unexpected such as staying within budget as unexpected costs surfaced throughout the project, another that was unexpected was the amount of training and learning to be done by all, also unexpected was employees leaving the organization and a shortage of skilled hopefuls looking for employment, projects were pushed back as timelines were too aggressive, and the private practices created a challenge because the entire process had to be created from the beginning. Expected outcomes included opportunities to reduce overall costs, streamlining current processes, automating every process, providing the best patient care and quality, increasing patient safety, being competitive, recruiting the best talent, and increasing awareness that Resurrection is ready for growth.
Other outside factors that were not considered was employee retention, bonus, employee salary market adjustments, and employee motivation, on the job stress, EHR learning curves, and team building. Because employees left the organization after they were trained, certified, and achieved a bit of build experience an employee retention program was created to give employees an additional salary increase. Bonuses were created to give employees $1,000 for every site that is implemented successfully. If an employee became certified in his/her application area then they were eligible to get a salary review to adjust their salary to what the market dictates in order to stay competitive in keeping skilled talent in the organization. Motivational speakers and forums were created to provide employees motivation to do their work and enjoy it by connecting with the organization. Employee outings were created to provide a release from stress along with sisters and pastors to become an ear and listen to those who are stressed and provide an outlet for them. More classes were made available in order to become more educated in the application product. And activities and charitable events were used for team building exercises with the intent to have teams and departments work together.
Evaluation of the Effort
Evaluating the organizations effort is a bit difficult because depending on how you look at certain data it can tell you a different story all the time. Also, the changes being implemented are still new and require more time in order to determine if things are successful or not. Regardless when you look at the overall changes, where the organization was in the past, where we are currently now, and where the projections tell us we will be there is no doubt that the effort on the organizations part has been successful. But as always there were items that could have been handled differently and the organizations inexperience to the changes was apperent.
Most of the action taken within my organization has been minimal. Everyone understands the issues that are forming but making changes and relieving some of the stress can impact the entire project negatively so managers and leadership are weary of making additional changes.
In my experience education is the key to change. If you are well informed of the change and know the risks, pros, cons, and impact of the change then you can intelligently make a successful decision and successfully transition change into any environment.
The actions I would take is to cross reference the changes and find what change category they fit in, then with the association of concepts and strategies one can deduce a change plan, a communication plan is just as critical as the plan itself, and throughout the project I would have an evaluation process to ensure things are on the right track. With all this information you can back up your theories and present it to the proper audience in order to adapt to the changes and transition them to meet the organizations goals.
Based on this course I can confidently say that the organization did a good job bringing in consultants that knew the principles of this class. They were able to follow the footprints to analyzing a problem and coming up with the data required to create a vision, strategy, and plan. The areas with the most breakdowns occurred in the communication process and ultimately created unnecessary resistance within the organizations. If I was in the leadership position I would have outlined the issues and provided them to everyone, then I would have asked for feedback so changes appear more like they are coming from the employees, then I would have shared the plans and vision from the beginning throughout the end. Reassuring employees and providing them information that would motivate them positively are some of the changes that would have taken place if I was in the CEO’s Sandra Bruce’s position.
There are many lessons learned and take aways from taking the Managing Organizational Change course. It afforded me the opportunity to review my organizational change and see it though more educated and experienced eyes. Based on experience, we always know right from wrong but we do not always know the reasons behind it or see things from a different viewpoint. I can now use new tools I have learned to research issues to find root causes, diagnosing for a potential change, images of managing change, more information on resistance and how it can be effectively controlled, key concepts and strategies of change, vision, communicating change, and sustaining change altogether. Education is the basis for everything successful and I feel this class has prepared me to be successful within my organization as I strive to improve my skills to one day become an organizational leader.

References
Palmer, Ian, Dunford, Richard, & Akin, Gib. (2008). Managing Organizational Change 2nd Edition. New York. McGraw-Hill.

Tidd, Joe, Bessant, John, & Pavitt, Keith. (2005). Managing Innovation & Integrating Technological, Market, and Organizational Change 3rd Edition. England. John Wiley & Sons, Ltd.

Argyris, Chris. (1993). Knowledge for Action: A Guide to Overcoming Barriers to Organizational Change. San Francisco, CA. Jossey-Bass Inc., Publishers.

Markus, Lynne M., Robey, Daniel. (1998). Information Technology and Organizational Change. Vol. 34, No. 5, pp. 583-598, Management Science. Informs.

Dawson, Patrick. (1994). Organizational Change: A Processual Approach. London, P.Chapman.

Kanter, Rosabeth Moss. (1992). Challenge of Organizational Change: How Companies Experience It and Leaders Guide It. New York, New York, Free Press.

Clark, Peter A. (1972). Action Research and Organizational Change. New York, New York, Harper and Row.