Strategic Management and the Organization of Health Services[1]

8/7/2019 Strategic Management and the Organization of Health Services[1]

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DRAFT AS OF 12/19/05 JKH 1

UNIVERSITY OF CALIFORNIA, BERKELEYSCHOOL OF PUBLIC HEALTH AND HAAS SCHOOL OF BUSINESS

DIVISION OF HEALTH POLICY AND MANAGEMENT

PH223C AND BA299H: STRATEGIC MANAGEMENT AND THE ORGANIZATION OFHEALTH SERVICES

Spring Semester 2006Fridays 9 a.m. to 12 Noon

125C Cheit

Professors:

Stephen M. Shortell, Ph.D., M.P.H. Jeff Oxendine, M.B.A., M.P.H.

417E, University Hall 19 Warren Hall

Phone: (510) 643-8451 Phone: (510) 642-2414E-mail: [email protected] E-mail: [email protected]

Fax: (510) 643-5056 Fax: (510) 642-9891

Office Hours:

Fridays Noon 1 p.m. or by appointment

Required Reading Materials:

1. Course Reader and Syllabus

(to be purchased on Study.Net through Catalyst at http://catalyst.haas.berkeley.edu)

2. Shortell S.M. and A. Kaluzny, Health Care Management: Organization Design and Behavior,

5th

Edition, Delmar, 2006.Referred to as Shortell and Kaluzny (S and K)

Supplemental Reading Materials (on reserve at SPH and Haas Libraries):

1. Swayne, L., Duncan, W.J., Ginter, P., Strategic Management of Health Care Organizations,

(5th Edition) Blackwell Publishers:Cambridge, MA 2006.

2. Shortell, S.M., Gillies R., Anderson D., et al., Remaking Healthcare in America: The

Evolution of Organized Delivery Systems (2nd

Edition), Jossey Bass:San Francisco2000.

3. Burns, L.R. The Business of Healthcare Innovation. Cambridge University Press, New York

2005.


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Additional Resource

HealthLeaders.com publishes daily and weekly electronic newsletters on healthcare business news.

Free subscriptions are available through the HealthLeaders.com web site. These and other newsletters

may help students keep up to date on developments in the health care sector and provide grist for classdiscussions.

Course Description and Objectives:

The overall purpose of this course is to assist you in leading health sector organizations from a

strategic perspective. This is accomplished by systematically addressing system, organization, group,and individual level issues in strategy formulation, content, implementation, and performance.

Emphasis is placed upon the executive's role in simultaneously taking into account a wide variety of

internal and external factors to improve organization and system performance in meeting the health

needs of individuals and communities. Emphasis is also placed on the development andimplementation of strategies to meet multiple stakeholder demands with particular attention given to

Continuous Quality Improvement/Total Quality Management approaches. The course will cover a

wide variety of health care organizations including community health centers, physician grouppractices, health systems, hospitals, HMOs, suppliers, pharmaceutical, biotech, and medical device

companies. Students are expected to have had at least one course dealing with the health care system

or relevant work-related experience. Students are required to have general background knowledge ofthe health system. Upon successful completion of the course you should be able to:

THINK STRATEGICALLY

1. By understanding the major different perspectives on organizations and their relevance

to the management of organizations in the health care sector.

2. By understanding the variety and complexity of the executive's role in guiding the

organization, particularly in regard to establishing its mission, culture, strategicdirection, and implementing its value system.

3. By developing your ability to analyze external environmental and competitive forcesinfluencing the organization

4. By developing alternative strategies for effectively positioning the organization to deal

with its environment.

SUCCESSFULLY IMPLEMENT STRATEGIES

5. By understanding the process of change and innovation and developing alternative

strategies for successfully implementing change and innovation.

6. By understanding the motivations of professionals and working effectively with

professionals to implement strategies.


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7. By understanding and being able to apply the philosophy, principles and tools behind

continuous quality improvement/total quality management.

BETTER PROMOTE ACCOUNTABILITY

8. By understanding the different approaches to assessing organizational performance anddeveloping performance measures and accountability systems, which maximize theirusefulness to the organization and to external stakeholders while recognizing their

limitations.

AND

9. Leap tall buildings in a single bound! (Just a check to see if you're still reading.)


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Course Methods:

To accomplish the above, we will, like good leaders and managers, take an eclectic approach. This

will involve: 1) reading the course materials to familiarize ourselves with the issues and various

approaches to them; 2) participating in group case debates; 3) participating in classroom lecture anddiscussion to probe the issues in greater depth; 4) applying new skills, insights and ideas in developing

mission statements, competitor analyses, and strategic plans; and 5) reflecting and evaluating what wehave learned from the experience. Leaders from various segments of the health care sector willparticipate in some class sessions to share with us their insights and experience about the issues that we

will be addressing.

The general format outlined above will be facilitated by your participation in a group of approximately

five people each. The groups will be involved in case analyses and discussions. These groups will beestablished in class.

GROUP STRATEGIC PLANNING PROJECTS

You will be assigned to a group of approximately five people for purposes of developing a written

strategic plan for a health care organization of your choice. This assignment will be made based on

your interests and class diversity. Each group will make an in-class oral presentation of its plan. Seesubsequent description entitled "Written Strategic Plan Guidelines." This group is likely to be different

from the case analysis groups.

Grading and Evaluation:

You will be evaluated on the basis of the following criteria:

1. Written Mission Statement (group) 10 points2. Written Case Analysis (Individual) 20 points

3. Group Written Strategic Plan and Oral Presentation 50 points4. Class discussion of cases and completion of 20 points

Required Readings (Individual)

__________

TOTAL 100 points

Pre-requisites:

PH223A (Introduction to the Health Care System), equivalent introductory course, or consent of theinstructor.


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SPECIAL NOTE #1:

Students must always be prepared to discuss the readings and cases for each session. To ensure that

all students have the opportunity to participate, we will call on students whose hands are not raised.

(Please let us know before class if some emergency has made it impossible for you to be adequatelyprepared for class that day).

SPECIAL NOTE #2:

Full participation in this class is required. The case discussions and group projects around which the

class is organized require regular attendance and participation. Students who have more than oneunexcused absence will have their grade lowered one letter (e.g.: A to B; B to C; etc.)

SPECIAL NOTE #3:

If at all possible, please do not schedule interviews for jobs or internships on Fridays so that you are

always able to attend class.

SPECIAL NOTE #4:

For the written group strategic planning project paper, each student is to evaluate every member of thegroup including you by assigning 80 to 120 points reflecting each person's relative contribution to the

group's paper. Overall, each group must average 100 points per member.

Example #1

Group member A = 100

Group member B = 95

Group member C = 105

300/3 = 100

Example # 2Group member A = 110

Group member B = 105

Group member C = 85300/3 = 100

Grading Policies:

In all written work, attention will be given to the quality of presentation - clarity of ideas,sentence and paragraph construction, linkage of paragraphs, etc. Points will be taken off

for lack of a clearly written, well-organized response as well as deficiencies in content.

If an assignment is more than two days late, one point will be taken off for each day the

assignment is late.


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CLASS AND TOPIC ASSIGNMENTS

Week 1: January 20th

COURSE OVERVIEW

i. Review Syllabus and Reading Listii. Form Case Discussion Groupsiii. Set Expectations

KEY DRIVERS OF CHANGE IN HEALTHCARE AND THEIR STRATEGY IMPLICATIONS

S and K, Chapters 15 and Chapter 1

THE MANAGER'S ROLEIN IMPROVINGHEALTH AND HEALTH CARE

ORGANIZATION MISSION, VALUES, VISION, AND CULTURE

1. A.M. Zuckerman, Creating a Vision for the Twenty-First Century Healthcare Organization,

Journal of Healthcare Management, September/October 2000, pp. 294-306.

2. J.C. Collins and J.I. Porras, Building Your Companys Vision, Harvard Business Review,September/October 1996, pp. 65-77.

3. J.A. Chatman and S.E. Cha, Leading by Leveraging Culture, California Management Review,

Summer 2003, pp 20-34.4. D. Brady, The Immelt Revolution, Business Week, March 28, 2005, pp. 64-71.

__________________________________________________________________________

Week 2: January 27th

POSITIONING THE ORGANIZATION

S and K, Chapter 14

5. M. Porter, "Operational Effectiveness is Not Strategy," Harvard Business Review, November-

December, 1996, 61-78.6. R. Winslow, How a Breakthrough Quickly Broke Down for Johnson & Johnson, The Wall Street

Journal, September 18, 1998.

7. P. Landers and J.S. Lublin, Under a Microscope: Mercks Big Bet on Research by Its Scientists

Comes up Short, The Wall Street Journal, November 28, 2003._____________________________________________________________________________


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Week 3: February 3rd

POSITIONING THE ORGANIZATION Continued

Group mission statements are due via e-mail.

8. J. Gilbert, P. Henske, and A. Singh, Rebuilding Big Pharmas Business Model, The Business andMedicine Report, November 2003.

9. D. Ulrich and N. Smallwood, Capitalizing on Capabilities, Harvard Business Review, June 2004,

pp 119-127.

______________________________________________________________________________

Week 4: February 10th

POSITIONING THE ORGANIZATION Continued

* 1St

Group Case Debate: Cooper Green Hospital and the Community Care Plan (A) and (B).

10.G. Hamel and L. Valikangas, The Quest for Resilience, Harvard Business Review, September

2003, 52 63.

Special Note Finalize your groups selection of organization for your strategic plan.

______________________________________________________________________________


POSITIONING THE ORGANIZATIONContinued

* Lloyd Dean, President and CEO, Catholic Health Care West (CHCW)

THE PROCESS OF DEVELOPING STRATEGY AND BUY-IN

______________________________________________________________________________


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THE PROCESS OF DEVELOPING STRATEGY AND BUY-IN- CONTINUED

IMPLEMENTING STRATEGY CQI Approaches, Concepts, Methods, and Applications

11.P. Plsek, Innovative Thinking for the Improvement of Medical Systems, Annals of Internal

Medicine, 131 (6): 438-444.

12.M. Hume, "Changing Hospital Culture and Systems Reduces Drug Errors and Adverse Events," inQuality Letter for Health Care Leaders, March 1999, pp. 2-12.

13.D.J. Shulkin, Commentary: Why Quality Improvement Efforts in Health Care Fail and What Can

Be Done About it, American Journal of Medical Quality, March/April, 2000, Vol. 15, No. 2, 49-53.

14.Reeder, L, Case Study: Award-Winning Benchmark for Technology Implementation, Disease

Management and Quality Improvement Report, September, 2003.

15.Begley, S, Too Many Patients Never Reap Benefits of Great Research, The Wall Street Journal,2003.

16.Landro, L, Six Prescriptions to Ease Rationing in U.S. Health Care, The Wall Street Journal,

December 21, 2003.

Week 7: March 3rd

IMPLEMENTING STRATEGY CQI - Continued

* Ian Morrison, PhD, President Emeritus, Institute for the Future, and Founding Partner,

Strategic Health Perspectives, 10:30 a.m. to 12:00 pm

S and K, Chapter 12

17.Institute of Medicine, Crossing the Quality Chasm: A New Health System for the 21st

Century,

Chapter 5, Building Organizational Supports for Change, 119-154, Washington, D.C., 2001, pp.119-154.

18.N. Nohria, W. Joyce, W, and B. Roberson, What Really Works, Harvard Business Review, July

2003, 42 52.__________________________________________________________________________


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Week 8: March 10th

IMPLEMENTING STRATEGY CULTURAL COMPETENCE AND DIVERSITY

* 2nd

group case debate: Strategic Deal-Making at Millennium Pharmaceuticals.

19.

J. Betancourt, et al, A Framework for Cultural Competency, Public Health Reports, August

2003, pp. 293-302.20.T.D. Goode and V.H. Jackson, Getting Started . . . and Moving On . . .Planning, Implementing

and evaluating Cultural and Linguistic Competency for Comprehensive Community Mental Health

Services for Children and Families, Washington, DC: Georgetown University, National Center for

Cultural Competence, Summer 2003

_____________________________________________________________________________

Week 9: March 17th

IMPLEMENTING STRATEGY TECHNOLOGY ADOPTION AND KNOWLEDGE

MANAGEMENT/TRANSFER

Written Case due either Sunrise Medical or Intermountain Health Care

Kaiser EMR implementation case, in class discussion

21.J.C. Goldsmith, The Healthcare Information Technology Sector, in Burns, The Business of

Health Care Innovation, Chapter 7, pp. 322-347, Cambridge University Press, 2005.

22.M.T. Hansen, N. Nohria, and T. Tierney, Whats Your Strategy for Managing Knowledge,Harvard Business Review, March-April, 1999, 106-116.

23.

C. ODell, C.J. Grayson, If Only We Knew What We Know: Identification and Transfer ofInternal Best Practices, California Management Review Reprint Series, Spring 1998, Vol. 40, No.

3, 154-174.24.D. Leonard-Barton and W.A. Kraus, Implementing New Technology, Harvard Business Review,

1985, pp 102-110.

25.J Tim Scott, Thomas G. Rundall, et al. Kaiser Permanentes experience of implementing anelectronic medical record: a qualitative study, BMJ, doi:10.38638.497477.68 (3 Nov. 2005)

26.Studer, M, The Effect of Organizational Factors on the Effectiveness of EMR SystemImplementation: What have we learned, Healthcare Quarterly, Vol 8, Number 4, 2005

______________________________________________________________________________


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Week 10: March 24th

IMPLEMENTING STRATEGY MANAGING WITH PROFESSIONALS AND NURTURING

CREATIVITY

* 3rd

group case debate Development of a Neurosciences Center of Excellence, Boston

Scientific.

27.D. Leonard and S. Straus, "Putting Your Company's Whole Brain to Work," Harvard Business

Review, July-August 1997, pp. 111-121.

28.P. Neuhauser, Chapter 6: Tribal Thinking Patterns, Identifying the Tribes in your Organization,

71-85.29.R. King, "New Therapy for Chiron: Fiscal Austerity," The Wall Street Journal, November 2, 1999.

30.B. Martinez, Now Its Mass Medicine, The Wall Street Journal, August 21, 2000.

PARTNERING WITH MDS

S and K, Chapter 9

31.J. Silversin, Culture and Compact, Leading Physicians Through Change: How to Achieve and

Sustain Results, J. Silversin and M.J. Kornacki, eds., American College of Physician Executives,

2000, pp. 45-57.______________________________________________________________________________

Week 11: March 31st

NO CLASS- SPRING RECESS

Week 12: April 7th

IMPLEMENTING STRATEGY CONTROL AND ACCOUNTABILITY

* 4th

group case debate Merck Global Health Initiatives (B): Botswana.

S and K, Chapter 23

32.R. Simons, Chapter 14 Levers of Control for Implementing Strategy. Performance

Measurement and Control Systems for Implementing Strategy, Prentice Hall, 2000, pp. 301-316.33.R. Winslow, "Making the Grade: Improvements in Quality of Care Suggest Hospitals are Taking

Report Cards to Heart," The Wall Street Journal, October 18, 1998, R16.

34.T.M. Burton, "An HMO Checks Up On Its Doctors' Care and is Disturbed Itself," The Wall Street

Journal, July 1999.35.J. Oliveira, The Balanced Scorecard: An Integrative Approach to Performance Evaluation,

Healthcare Financial Management, May 2001, pp 41-46.


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Week 13: April 14th

IMPLEMENTING STRATEGY BUILDING EFFECTIVE STRATEGIC PARTNERSHIPS

* Susan Desmond Hellman, MD, PhD, Co-President, Genentech, South San Francisco, CA. 9:00

a.m. to 10:30 a.m. Managing the Strategic Pipeline

* In Class Case Discussion for All StudentsUCSF-Stanford Merger

S and K, Chapter 11

36.L. Lagnado, "Hospital Mergers: Indications of Severe Trauma" in The Wall Street Journal, May

14, 1999, B1, B6.37.L. Lagnado, "CEO Crisis Roils Merged Hospital, in The Wall Street Journal, B1, B4.

38.S. Madden, The Merger of UCSF Medical Center and Stanford Health Services, President and

Fellows of Harvard College. 2001.39.L. Benko, Meet the New Wellpoint, Modern Healthcare. November 3, 2003.

Week 14: April 21st

IMPLEMENTING STRATEGY EFFECTIVE PARTNERSHIPS CONTD

40.N.M. Kane, Southcoast Health SystemPart A, President and Fellows of Harvard College.

2000.41.N.M. Kane, Southcoast Health SystemPart B, President and Fellows of Harvard College.2000.

42.L. Burns, S. Nicholson, and J. Evans, Mergers, Acquisitions, and the Advantages of Scale in the

Pharmaceutical Sector, in Burns, The Business of Healthcare Innovations, Chapter 5, pp 223-268.

One strategic plan group presentations

Week 15: April 28th

FOUR STRATEGIC PLANNING GROUP PRESENATIONS


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Week 16: May 5th

Three STRATEGIC PLANNING GROUP PRESENTATIONS PLUS

COURSE WRAP UP AND EVALUATION

SPECIAL NOTE: Your group written strategic plans are due no later than Monday, May 8th

at 5:00

pm. Please submit to 417E University Hall, or fax (510) 643-5056, or e-mail: [email protected].

Thank you.

SPECIAL NOTE: Your group written strategic plans are due no later than Monday, May 8th at

5:00pm Please submit to 417E University Hall or fax (510) 643-5056, or email:

[email protected].

Thankyou.

Strategic Management and the Organization of Health Services[1]

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