Yes, hospitals in the same town often collaborate. Yes, hospitals have noble missions to strive for and provide an essential public service to their communities. And yes, hospitals are all about compassionate caring and about each precious person that walks through our doors.
But hospitals also have to be run like businesses to survive. For some reason, some people rail against that fact. But really, it's really just another way of saying that hospitals have to make smart decisions about trade-offs. It means saying "no" to some good initiatives in order to say "yes" to what's truly best for the hospital's future. Someone has to tend to the overall view of the hospital - to think about financial, clinical, political, operational, and strategic aspects of the hospital's mission and make it all work out.
For too long hospitals have had no strategy. Far too often, hospital executives are simply putting out fire after fire. They're thinking about the monthly numbers, about one patient's story, about the next report to the board, or (at best) about the next year. All of this is good to think about, but when does anyone have time to look further than that? When does anyone even put the words "hospital" and "strategy" together at all?
Starting next week, I want to begin a "Hospital Strategy" series on how we can start thinking about and putting together our hospital strategy. I've spent a lot of time blogging here about tactics, goals, and trends - I realize that that's not enough. In this increasingly crazy operating environment, it is more important than ever that we think very lucidly about our hospital's strategy. What differentiates our hospital from all others? What is the core of our strength?
To be sure, I think every industry and every executive struggles with this. But the most successful companies (no matter what industry) I've seen are the ones who nail the strategy. One day, if our hospitals really become the best-run organizations on the face of the planet, we will know that hospital executives finally got serious about hospital strategy.
Comments:
I think some hospitals shy away from thinking about competitive advantage for many of the reasons you indicated above – and because identifying competitive advantage in healthcare conjures up a picture of the ugly side of competition. However, many hospitals have begun to nurture the nascent elements of true competitive advantage: differentiation on quality. Driven in large part by external factors – pressure from Medicare or the threat of consumer-driven healthcare – there is a revolution taking shape and those providers that embrace these concepts will be the first to derive a strategy based truly on competitive advantage.
Interestingly enough, I found out today that Jim Collins (Good to Great) is starting to focus on non-profits. He just wrote a monograph "Good to Great for the Social Sector: Why Business Thinking is Not the Answer." I just purchased this and will post some thoughts (and a review) on this soon.