It’s the Culture, Stupid

This post’s title is what I reminded myself of when I read the recent interview Megan McArdle did with Delos (“Toby”) Cosgrove, CEO of the Cleveland Clinic.  In that article, Can the Cleveland Clinic Save American Health Care? Dr. Cosgrove shares and explains several of the core elements behind the Clinic’s success. I was able to identify two concepts discussed by Dr. Cosgrove that I believe are more important to redefining healthcare in the United States than anything else: alignment of incentives and change management.  Both of these concepts are, in turn, major pillars of organizational culture.

And both are concepts, which transcend the argument that comparisons to organizations like the Cleveland Clinic, the Mayo Clinic, MD Anderson Cancer Center, Memorial Sloan Kettering, Johns Hopkins, et al) are often misguided and counterproductive because of the unique positioning and market advantages those organizations hold.

As Ms. McArdle writes in her article,

”Great institutional cultures can accomplish great things.  But in some ways, that’s a problem for the rest of us. It’s natural to want to emulate the achievements of [the] Cleveland Clinic in our policies. But you can’t make a culture out of rules. Culture is an organic outgrowth of an organization’s history, it’s people, its successes and failures. It cannot be ordered from the top, or nurtured by simply altering the financial incentives. Cosgrove speaks of maintaining the institution’s culture in much the way that he talks of maintaining their electronic health records system: a constant process of checking in, re-evaluating, and upgrading.”

But Cosgrove also believes the Clinic’s success can be replicated.  In the article he states that, “yes, other people can do it. One of the things that is beginning to drive this is the patient satisfaction scores that is now becoming part of the pay for hospitals ….” but “both the incentives and the culture matter. They’re inexorably tied.”

Creating a culture that instills and motivates behavior, which reflects incentives tied to desired outcomes – whether those are measured in terms of access, cost or quality and safety – is a difficult challenge that really does not get substantially easier or harder in relation to the size of an organization.  This is because – as my friend and colleague, Craig Anderson (National Director of Healthcare at Dixon Hughes Goodman) is fond of saying – “organizations don’t, never have and never will change – people change, one person at a time.”

And individual change is very hard for all of us.  It means being even more uncomfortable in a world of constant uncertainty.  It means not having the level of control you mistakenly thought you had in the first place.  It means letting go of some very deep-seated beliefs on how your environment should be ordered, arranged and understood.

To create the kind of culture that has been successful at the Cleveland Clinic requires an artful infiltration of the organization’s psyche. Careful attention must be given to long-standing relationships and patterns of behavior.  It is quite easy to do more damage than good. But if done right, the payoff can be a remarkable transformation from a healthcare organization inexorably floundering in reaction to its environment – to an organization that is emulated for proactively achieving great success, like the Cleveland Clinic.


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