Achieving operational excellence yields better results in hospitals

A recent article showed how achieving "Magnet status" in hospitals has helped provide a better quality of care and lowered patient mortality rates in those hospitals.

Magnet status is an award given by the American Nurses' Credentialing Center to hospitals that satisfy a set of criteria designed to measure the strength and quality of their nursing. Only 8% of US hospitals have received the award.

One of the keys to achieving Magnet status is the focus on operational excellence, specifically in these areas:

employee satisfaction and retention

professional development

aligning daily activities with a strategy based on best practices and the best patient outcomes

enhancing accountability and measuring progress.

This is yet another way that operational excellence can help improve results in your organization.

Click here for more details.

What does it take to be a thought leader?

I attended an exclusive, intimate event last week focused around thought leadership. 12 of us spent three days talking about what it takes to be a thought leader and how to go about becoming a thought leader in your area of expertise (mine is operational excellence). Here are some of the key points:

  • To be a thought leader you need to constantly have new, edgy and provocative ideas
  • Your ideas must be pragmatic and realistic
  • You need to spread your ideas through different vehicles-the Internet, books, articles, audio, video, visuals, and so on
  • You need to have a following, people need to know who you are and be interested in your ideas
  • Your ideas need to be readily available for people to see
  • You need to look at what others have done and enhance their ideas
  • You must have a passion for what you do and a desire to make a difference

We had a well-known thought leader spend an afternoon with us and it was an informative experience. However, her views of the world were pessimistic and in some cases, fatalistic. Her belief is that people can't change, so why bother trying. This was not the view that was held by the majority of us in the room, so it led to an interesting discussion because everyone has their own perspective and viewpoint and experience. This helped me draw the conclusion that the more pragmatic the idea, the more it will be embraced by others. This thought leader's ideas were revoluntionary, but not pragmatic, so organizations had difficulty in implementing them.

Thought leaders feel compelled to share their views with others because of the improvements that people can make in their lives and their organizations by adopting their ideas. But with that comes the pressue to produce new ideas and prove that your ideas work in the real world. You need to decide if that is something you strive for. Thought leadership is not for the faint of heart.

The Music of Business

Did you ever think that business principles were like good music? They are, because they never lose their appeal. Think about today's music environment, especially in rock music. Many of the most popular bands have been playing for years and years. When a great song comes on the radio, it doesn't matter when it was written, it is still a great song. Bands like the Eagles, the Rolling Stones, The Who, Led Zeppelin and many others continue to attract new fans to their music. Just like basic business priniciples continue to be used by new companies and old ones.

Here are some timeless business principles that help companies be successful:

  • Sustainable change can only happen if the people impacted by the change support it and help shape it
  • Know who your target customer is and what you can offer them that no one else can
  • Attract great people to your organization and empower them to make decisions
  • Without strong execution, strategy is useless
  • Operating speed will impact results
  • Strong leadership is required at all levels of the organization
  • The fastest way to grow is through creating evangelists/ambassadors for your brand
  • You must provide a quality product or service

How many of these principles are you practicing in your business?

Determining operational excellence

Why are some companies able to achieve operational excellence better than others? How do we know whether or not a company is operationally excellent? Who are the avatars for operational excellence?

I am asked these questions often by clients, prospects and colleagues. Let me answer these questions with some examples.

Some companies are able to achieve operational excellence because of their mindset. The organization has a relentless pursuit in doing things faster and better. Employees are empowered to make decisions in the best interest of the company and its stakeholders, there is a culture of innovation, the best people want to work there and accountability and results are measured.

For example, why has Walmart achieved operational excellence?

  • They have strong collaboration with business partners-they work with suppliers to improve processes and reduce costs
  • They are always looking for new and innovative ways to operate-they are never satisfied with the status quo
  • They engage their customers in selecting new products
  • They attract the best and brightest people and retain them
  • They take industry leadership positions-they are the foremost company on areas like sustainability

If you want to know where you stand, email me and ask about my free operational excellence assessment.

Closing the Collaboration Gap in healthcare

I often write and talk about the collaboration gap between healthcare providers and suppliers. Click here for a visual depiction. This gap is created during the procurement process when providers send out long, detailed Request for Proposal documents, and suppliers respond with long, detailed proposals. The focus for providers tends to be on the requirements, specifications, process rules and evaluation criteria to be used in making the decision and the focus of suppliers in their proposals tends to be the features and benefits of their product or service. But what if the supplier's features and benefits don't meet the provider's specifications and requirements? Then we have a gap, and that gap could be closed with increased collaboration.

Here are some ways to close the collaboration gap:

  1. Run a purchasing process that is outcome-based, not focused on requirements and specifications. Focus on the question, "What are we trying to achieve by making this purchase?"
  2. Implement procurement processes that include suppliers as stakeholders. Find out what options there ae in the market place before embarking on a formal purchasing process. Use mechanisms like Requests for Information, Best and Final Offer and Vendors of Record to involve suppliers earlier on in the process.
  3. Understand the interpretation of the rules. There are many different rules around public procurement in Canada and we need to come to a common understanding about how they are being interpreted and utilized. Suppliers must understand how their customers are using the legislation.
  4. Distinguish between strategic and commodity purchases. A company can't run the same type of procurement process for gloves as they do complex technology. Identify the purchases that are most strategic to the success of the organization and run those purchases in a more collaborative manner to ensure the right decision is made.
  5. Communicate differently. The way that suppliers used to communicate and sell to their healthcare customers has changed. The focus needs to be on solutions that have an impact on performance and results. Focus on case studies and results to ensure customers see the value of the solution and understand how it will help their performance.

There is a better, quicker, and more effective way to do things that will achieve better outcomes.We just need to implement the right initiatives.

Why aligning your strategy with tactics leads to business success

Strategy is the what (what you want to achieve), and tactics are the how (how you will achieve it).

Most organizations are able to develop a great strategy, but fail at the tactical execution stage. This is often due to the fact that the activities the organization performs are not aligned with the strategy it developed. In other words, how the organization goes about trying to execute the strategy is not aligned with what the organization is trying to achieve.

Think about the “customer-facing” organization that only contacts customers when there is something new to sell, or the "entrepreneurial" organization where all decisions must be approved by the CEO, or the company who preaches diversity yet has a management team who are all the same ethnicity. These are all cases where strategy and tactics are not aligned.

Here are a few reasons why it is essential to align your organizational strategy and tactics:

  • You ensure productivity of your resources because they are only focused on activities that add value to your organization
  • You eliminate duplication of effort and gaps in accountability
  • You are able to measure success and results
  • You are able to respond quickly when activities are not helping to achieve your desired outcome
  • You achieve better results because everyone understands the desired outcome
  • You have a clear roadmap to communicate both internally and externally
  • You ensure that all employees understand their role in achieving the desired future state
  • You provide a clear message to employees and the marketplace about who you are and what you want to achieve
  • You increase your abiltiy to attract and retain the best people
  • You elicit trust from your customers, leading to stronger loyalty

De-mystifying customer engagement myth #3

Let's talk about customer engagement myth #3: All customers are created equal.

We all know that is not true, yet we continue to say it. Do you really treat your 10 best customers the same way you treat someone who has just walked in off the street?

If you do, maybe that would explain why you are struggling to retain your best customers. Think of Rogers Wireless. I have been a customer of theirs for close to 10 years. My family has three cell phones with them (as well as numerous other products and services) and there will be more to come. When I recently tried to upgrade my phone, I was told that someone coming off the street could receive a better deal than I could. I have spent close to $50,000 with this company, yet a new customer gets a better deal than I do. Does that make sense?

All customers are not created equal. However, the best companies have learned how to treat every customer LIKE THEY ARE THEIR BEST CUSTOMER. That doesn't mean you treat all customers the same way, it just means that you make every customer feel special.

You should be spending the most time and effort on your best customers and working on engaging and retaining them. This is called stratifying your customers. You need to know which customers spend the most with you, which are most profitable and even which customers have the best potential to provide the exponential value of customer retention.

That doesn't mean you ignore the rest, because you never know which new customers might eventually become your best customers, but it means you focus on retaining and growing those who have proved to be loyal and profitable in the past.