Sunday, October 27, 2013

Scott Adams' Secret of Success: Failure What's the best way to climb to the top? Be a failure.

http://online.wsj.com/news/articles/SB10001424052702304626104579121813075903866
SCOTT ADAMS


"Dilbert" creator Scott Adams talks to WSJ editor Gary Rosen about how to draw lessons, skills and ideas from your failures—and why following your passion is asking for trouble. Photo: Scott Adams

If you're already as successful as you want to be, both personally and professionally, congratulations! Here's the not-so-good news: All you are likely to get from this article is a semientertaining tale about a guy who failed his way to success. But you might also notice some familiar patterns in my story that will give you confirmation (or confirmation bias) that your own success wasn't entirely luck.

If you're just starting your journey toward success—however you define it—or you're wondering what you've been doing wrong until now, you might find some novel ideas here. Maybe the combination of what you know plus what I think I know will be enough to keep you out of the wood chipper.
Let me start with some tips on what not to do. Beware of advice about successful people and their methods. For starters, no two situations are alike. Your dreams of creating a dry-cleaning empire won't be helped by knowing that Thomas Edison liked to take naps. Secondly, biographers never have access to the internal thoughts of successful people. If a biographer says Henry Ford invented the assembly line to impress women, that's probably a guess.
But the most dangerous case of all is when successful people directly give advice. For example, you often hear them say that you should "follow your passion." That sounds perfectly reasonable the first time you hear it. Passion will presumably give you high energy, high resistance to rejection and high determination. Passionate people are more persuasive, too. Those are all good things, right?
Here's the counterargument: When I was a commercial loan officer for a large bank, my boss taught us that you should never make a loan to someone who is following his passion. For example, you don't want to give money to a sports enthusiast who is starting a sports store to pursue his passion for all things sporty. That guy is a bad bet, passion and all. He's in business for the wrong reason.
My boss, who had been a commercial lender for over 30 years, said that the best loan customer is someone who has no passion whatsoever, just a desire to work hard at something that looks good on a spreadsheet. Maybe the loan customer wants to start a dry-cleaning store or invest in a fast-food franchise—boring stuff. That's the person you bet on. You want the grinder, not the guy who loves his job.
For most people, it's easy to be passionate about things that are working out, and that distorts our impression of the importance of passion. I've been involved in several dozen business ventures over the course of my life, and each one made me excited at the start. You might even call it passion.
The ones that didn't work out—and that would be most of them—slowly drained my passion as they failed. The few that worked became more exciting as they succeeded. For example, when I invested in a restaurant with an operating partner, my passion was sky high. And on day one, when there was a line of customers down the block, I was even more passionate. In later years, as the business got pummeled, my passion evolved into frustration and annoyance.
On the other hand, Dilbert started out as just one of many get-rich schemes I was willing to try. When it started to look as if it might be a success, my passion for cartooning increased because I realized it could be my golden ticket. In hindsight, it looks as if the projects that I was most passionate about were also the ones that worked. But objectively, my passion level moved with my success. Success caused passion more than passion caused success.
So forget about passion. And while you're at it, forget about goals, too.
Just after college, I took my first airplane trip, destination California, in search of a job. I was seated next to a businessman who was probably in his early 60s. I suppose I looked like an odd duck with my serious demeanor, bad haircut and cheap suit, clearly out of my element. I asked what he did for a living, and he told me he was the CEO of a company that made screws. He offered me some career advice. He said that every time he got a new job, he immediately started looking for a better one. For him, job seeking was not something one did when necessary. It was a continuing process.
This makes perfect sense if you do the math. Chances are that the best job for you won't become available at precisely the time you declare yourself ready. Your best bet, he explained, was to always be looking for a better deal. The better deal has its own schedule. I believe the way he explained it is that your job is not your job; your job is to find a better job.
This was my first exposure to the idea that one should have a system instead of a goal. The system was to continually look for better options.
Throughout my career I've had my antennae up, looking for examples of people who use systems as opposed to goals. In most cases, as far as I can tell, the people who use systems do better. The systems-driven people have found a way to look at the familiar in new and more useful ways.
To put it bluntly, goals are for losers. That's literally true most of the time. For example, if your goal is to lose 10 pounds, you will spend every moment until you reach the goal—if you reach it at all—feeling as if you were short of your goal. In other words, goal-oriented people exist in a state of nearly continuous failure that they hope will be temporary.
If you achieve your goal, you celebrate and feel terrific, but only until you realize that you just lost the thing that gave you purpose and direction. Your options are to feel empty and useless, perhaps enjoying the spoils of your success until they bore you, or to set new goals and re-enter the cycle of permanent presuccess failure.
I have a friend who is a gifted salesman. He could have sold anything, from houses to toasters. The field he chose (which I won't reveal because he wouldn't appreciate the sudden flood of competition) allows him to sell a service that almost always auto-renews. In other words, he can sell his service once and enjoy ongoing commissions until the customer dies or goes out of business. His biggest problem in life is that he keeps trading his boat for a larger one, and that's a lot of work.
Observers call him lucky. What I see is a man who accurately identified his skill set and chose a system that vastly increased his odds of getting "lucky." In fact, his system is so solid that it could withstand quite a bit of bad luck without buckling. How much passion does this fellow have for his chosen field? Answer: zero. What he has is a spectacular system, and that beats passion every time.
As for my own system, when I graduated from college, I outlined my entrepreneurial plan. The idea was to create something that had value and—this next part is the key—I wanted the product to be something that was easy to reproduce in unlimited quantities. I didn't want to sell my time, at least not directly, because that model has an upward limit. And I didn't want to build my own automobile factory, for example, because cars are not easy to reproduce. I wanted to create, invent, write, or otherwise concoct something widely desired that would be easy to reproduce.
My system of creating something the public wants and reproducing it in large quantities nearly guaranteed a string of failures. By design, all of my efforts were long shots. Had I been goal-oriented instead of system-oriented, I imagine I would have given up after the first several failures. It would have felt like banging my head against a brick wall.
But being systems-oriented, I felt myself growing more capable every day, no matter the fate of the project that I happened to be working on. And every day during those years I woke up with the same thought, literally, as I rubbed the sleep from my eyes and slapped the alarm clock off.
Today's the day.
If you drill down on any success story, you always discover that luck was a huge part of it. You can't control luck, but you can move from a game with bad odds to one with better odds. You can make it easier for luck to find you. The most useful thing you can do is stay in the game. If your current get-rich project fails, take what you learned and try something else. Keep repeating until something lucky happens. The universe has plenty of luck to go around; you just need to keep your hand raised until it's your turn. It helps to see failure as a road and not a wall.
I'm an optimist by nature, or perhaps by upbringing—it's hard to know where one leaves off and the other begins—but whatever the cause, I've long seen failure as a tool, not an outcome. I believe that viewing the world in that way can be useful for you too.
Nietzsche famously said, "What doesn't kill us makes us stronger." It sounds clever, but it's a loser philosophy. I don't want my failures to simply make me stronger, which I interpret as making me better able to survive future challenges. (To be fair to Nietzsche, he probably meant the word "stronger" to include anything that makes you more capable. I'd ask him to clarify, but ironically he ran out of things that didn't kill him.)
Becoming stronger is obviously a good thing, but it's only barely optimistic. I do want my failures to make me stronger, of course, but I also want to become smarter, more talented, better networked, healthier and more energized. If I find a cow turd on my front steps, I'm not satisfied knowing that I'll be mentally prepared to find some future cow turd. I want to shovel that turd onto my garden and hope the cow returns every week so I never have to buy fertilizer again. Failure is a resource that can be managed.
Before launching Dilbert, and after, I failed at a long series of day jobs and entrepreneurial adventures. Here are just a few of the worst ones. I include them because successful people generally gloss over their most aromatic failures, and it leaves the impression that they have some magic you don't.
When you're done reading this list, you won't have that delusion about me, and that's the point. Success is entirely accessible, even if you happen to be a huge screw-up 95% of the time.
My failures:
Velcro Rosin Bag Invention: In the 1970s, tennis players sometimes used rosin bags to keep their racket hands less sweaty. In college, I built a prototype of a rosin bag that attached to a Velcro strip on tennis shorts so it would always be available when needed. My lawyer told me it wasn't patentworthy because it was simply a combination of two existing products. I approached some sporting-goods companies and got nothing but form-letter rejections. I dropped the idea.
But in the process I learned a valuable lesson: Good ideas have no value because the world already has too many of them. The market rewards execution, not ideas. From that point on, I concentrated on ideas that I could execute. I was already failing toward success, but I didn't yet know it.
Gopher Offer: During my banking career, in my late 20s, I caught the attention of a senior vice president at the bank. Apparently my b.s. skills in meetings were impressive. He offered me a job as his gopher/assistant with the vague assurance that I would meet important executives during the normal course of my work, which would make it easy for him to strap a rocket to my backside—as the saying roughly went—and launch me up the corporate ladder.
On the downside, the challenge would be to survive his less-than-polite management style and do his bidding for a few years. I declined his offer because I was already managing a small group of people, so becoming a gopher seemed like a step backward. I believe the senior vice president's exact characterization of my decision was "[expletive] STUPID!!!" He hired one of my co-workers for the job instead, and in a few years that fellow became one of the youngest vice presidents in the bank's history.
I worked for Crocker National Bank in San Francisco for about eight years, starting at the very bottom and working my way up to lower management. During the course of my banking career, and in line with my strategy of learning as much as I could about the ways of business, I gained an extraordinarily good overview of banking, finance, technology, contracts, management and a dozen other useful skills. I wouldn't have done it any differently.
Webvan: In the dot-com era, a startup called Webvan promised to revolutionize grocery delivery. You could order grocery-store items over the Internet, and one of Webvan's trucks would load your order at the company's modern distribution hub and set out to service all the customers in your area.
I figured Webvan would do for groceries what Amazon had done for books. It was a rare opportunity to get in on the ground floor. I bought a bunch of Webvan stock and felt good about myself. When the stock plunged, I bought some more. I repeated that process several times, each time licking my lips as I acquired ever-larger blocks of the stock at prices I knew to be a steal.
When the company announced that it had achieved positive cash flow at one of its several hubs, I knew that I was onto something. If it worked in one hub, the model was proved, and it would surely work at others. I bought more stock. Now I owned approximately, well, a boatload.
A few weeks later, Webvan went out of business. Investing in Webvan wasn't the dumbest thing I've ever done, but it's a contender. The loss wasn't enough to change my lifestyle. But boy, did it sting psychologically. In my partial defense, I knew it was a gamble, not an investment per se.
What I learned from that experience is that there is no such thing as useful information that comes from a company's management. Now I diversify and let the lying get smoothed out by all the other variables in my investments.
These failures are just a sampling. I'm delighted to admit that I've failed at more challenges than anyone I know.
As for you, I'd like to think that reading this will set you on the path of your own magnificent screw-ups and cavernous disappointments. You're welcome! And if I forgot to mention it earlier, that's exactly where you want to be: steeped to your eyebrows in failure.
It's a good place to be because failure is where success likes to hide in plain sight. Everything you want out of life is in that huge, bubbling vat of failure. The trick is to get the good stuff out.
Mr. Adams is the creator of Dilbert. Adapted from his book "How to Fail at Almost Everything and Still Win Big," to be published by Portfolio, a member of Penguin Group (USA), on Oct. 22.

Friday, October 18, 2013

10 Steps to Executive-Level Confidence

Speakeasy
http://blogs.wsj.com/speakeasy/2013/10/15/10-steps-to-executive-level-confidence/?mod=trending_now_1


Making the move from middle management to the executive suite requires a healthy dose of confidence. Executives have to make critical, wide-reaching decisions, often with limited information and time—then persuade others to execute those decisions. Self-assurance is a must.
Yet gaining confidence can be a struggle. The “Impostor Syndrome” is real:  researchers at Georgia State University found that 33% of the high-achieving adults they interviewed did not feel they deserved their success. The Imposter Syndrome meant that sufferers opted out of important career opportunities, to their financial and personal detriment.
Women in particular struggle with confidence. They often are less adept at moving forward after setbacks, reading temporary failures as permanent deficiencies, and they often have smaller professional social safety nets than men.
The good news is that confidence can be learned, like any career skill. Here are 10 steps that can have you operating from a place of power:
1) When in doubt, act. It’s the difference between running and stagnant water. When you’re stagnant, doubt and insecurities breed like mosquitoes. Dale Carnegie wrote that “inaction breeds doubt and fear. Action breeds confidence and courage.” Fear of failure can paralyze us, as we almost always overestimate the consequences. Build your confidence instead by taking action, often.
2) Do something outside your comfort zone each day. If we don’t stretch our comfort zones, they shrink. Constantly challenge and improve yourself, and you’ll become comfortable doing new things—and you will establish your identity (both to yourself and others) as someone who takes risks. Each new thing you try adds to your knowledge and skill base, and provides you with a foundation of competence. This is the bedrock of any successful career.
3) Put the focus on others. Choose to be conscious of others instead of self-conscious. Ask people questions. Turn conversations into a game where you try to find a connection with the other person. Give compliments generously, and volunteer to help others when you can. Looking for the best in others will help you see it in yourself.
4) Cultivate mentors. Their advice and connections are invaluable, plus you will make better decisions about opportunities thanks to their objective assessments of the pros and cons. And you will be much more willing to take risks knowing you have supporters who will help you get back up on your feet if you fail.
5) Keep self-talk positive. It’s hard to feel confident if someone puts you down all the time. It’s impossible if that naysayer is you. Watch how you talk to yourself. Is it how you would talk to a friend? If not, then make a change.
6) Eliminate negative people from your network. You absolutely need to invite and be receptive to constructive criticism if you want to grow as a professional and as an individual. But recognize that some people will never be happy with you or with life, and it is a waste of time to try to convince them of your worth.  What’s more, their sour outlook on life is contagious. Learn to identify these people quickly, and move on.
7) Take care of your health. Make time for exercise, and get enough rest. Your body must be physically ready to take on challenges.
8) Do your homework. Keep up-to-date on the news in your industry, and know your company and department inside and out. If you have a challenging task ahead, prepare and practice in your mind. Nothing builds confidence like knowledge and preparation.
9) Watch your body language. Your posture and overall appearance affect both your mental state and how others perceive (and thus respond) to you. If you want to be a leader, you have to dress and act the part. Stand and sit up straight, make eye contact, and remember to smile. Wear the professional clothing of your industry. Eliminate the telltale signs of nervousness: excessive twitching, closed-off posturing (crossed arms and legs, hunched shoulders), and shallow breathing.
10) Practice gratitude daily. In a recent study of how successful people spend the first hour of each day, the No. 1 response was investing time in thinking about the things for which they are most grateful. Starting your day by saying “thank you” for the good in your life makes it more likely that you will approach the day’s challenges with the proper perspective.
Like public speaking or leadership, confidence is a professional skill that can be improved. According to Dr. Peter Buckley of Georgia Regents University, “As you add experiences, you’re more likely to gain confidence. And with confidence, you will embrace new experiences.” Start growing your confidence today.

Tuesday, October 15, 2013

MANIFESTO: Mengintegrasikan Servis dan Sales


http://the-marketeers.com/archives/mengintegrasikan-servis-dan-sales.html#.Ul3CiNLry-l
 Sigit Kurniawan



Saat ini, banyak perusahaan yang menarik biaya tambahan untuk layanan servis yang sebelumnya digratiskan. Misalnya, dulu, bila kita membeli piano Yamaha ada tambahan kursus piano gratis. Namun, sekarang, kalau mau kursus, orang harus merogoh koceknya lagi. Tapi, kursus tetap laku karena kualitasnya lebih baik dibanding saat digratiskan.

Banyak servis yang dulu digratiskan lalu berbayar tapi tetap ramai peminat. Misalnya, meskipun banyak lounge eksekutif sekarang berbayar, tapi tetap dipenuhi oleh pelanggan. Hal ini membuktikan bahwa servis pun bisa dijual apabila dikelola dengan baik. Pertanyaan sederhananya, kalau bisa dijual untuk pelanggan, kenapa harus digratiskan? Tentu dengan catatan, pelanggan bakal menerima layanan yang lebih dibanding dengan saat digratiskan.

Pemikiran di atas berbeda dengan pemikiran dahulu yang memposisikan servis sebagai pelengkap produk. Sebab itu, lumrah bila ada servis gratis, seperti gratis biaya kirim, gratis makan pagi, dan sebagainya.

Ada pandangan yang mengatakan "ada uang, ada barang." Pandangan ini seolah mau mengatakan kalau Anda mau mendapatkan hal yang lebih dan berkualitas, Anda harus membayarnya lebih dulu. Di sisi lain, ada pandangan juga yang mengatakan yang gratis biasanya kurang berkualitas. Gratis sama saja dengan terlambat antar, gratis sering dilekatkan dengan penanganan yang asal-asalan, dan sebagainya. Sementara, orang lebih memilih mengeluarkan uang lebih untuk mendapatkan servis yang memuaskan.

Servis merupakan ajang cross selling dan up selling yang bisa memberi keuntungan. Bila kualitas servisnya asal-asalnya, bagaimana orang servis bisa menjualnya? Padahal, kalau orang servis itu sadar, ketidakpuasan pelanggan terhadap customer service bisa memengaruhi pemasukan pendapatan perusahaan tempat mereka bekerja. Sebab itu, penting sekali melatih orang-orang servis sebagai tenaga penjualan untuk belajar service excellence.

Untuk mengintegrasikan servis dan sales, ada beberapa hal yang patut di simak. Dulu, servis dianggap sebagai cost center. Sekarang, servis bisa diperlakukan sebagai profit center. Westin Hotel, misalnya, menjual bantal dan kasurnya kepada pelanggannya. Peminatnya banyak karena bantal dan kasur hotel tersebut terkenal dengan keempukannya. Lalu, beberapa toko buku sekarang menyediakan servis lebih kepada pengunjung toko dengan lounge atau kafe. Sekarang, banyak lounge dan kafe toko buku dikelola secara independen sehingga bisa mendatangkan profit yang lebih besar lagi.

Friday, October 11, 2013

How to Design a Bundled Payment Around Value

HBR Blog Network

http://blogs.hbr.org/2013/10/how-to-design-a-bundled-payment-around-value/

by Mary Witkowski, Larry Higgins, Jon Warner, Michael Sherman, and Robert S. Kaplan


20131004_4

The traditional fee-for-service reimbursement model is widely acknowledged to be a major driver of escalating health care costs. Because it rewards the volume of treatments, not the medical outcomes produced, it offers no way for the industry to reward its best providers and for patients to seek them out. It also penalizes cost reduction since eliminating unnecessary procedures leads to lower reimbursements.
For this reason, many health care practitioners and policymakers advocate a new bundled-payments model that reimburses providers with a fixed fee for delivering all the services required to deliver a complete cycle of patient care for a specific clinical condition. Bundled payments (BP) have the potential to reward providers that deliver more value to their patients — better outcomes at lower costs.
In practice, however, bundled payments have struggled to gain traction. One reason is many bundled-payment contracts use artificially short time horizons, not a complete cycle of care, which cause the contract to be similar to a traditional fee-for-service model. Another reason is these new contracts are negotiated at the payer-administrator level in a zero-sum cost-shifting process. Insurers strive to lower the prices they pay while the hospital’s contract administrators attempt to preserve top-line revenues. Physicians, left on the sideline while these new contracts are being forged, are further distanced from the new payment model because they often lack experience in measuring patient outcomes and have little confidence in their costs.
To understand how to address these concerns, an academic team from Harvard Business School brought together a group of orthopedic surgeons from the Boston Shoulder Institute and Harvard Pilgrim Health Care, a Boston-based insurer, to create a new BP model focused on patient value. While the final price for the contract has yet to be negotiated, we believe that the structure and development process used to create this bundle can inform other providers and insurers about how to create bundled-payment contracts that benefit all the stakeholders: providers, insurers, and, most importantly, patients.
The Motives of the Pilot’s Members
The Harvard researchers believed that their expertise in value-based health care delivery could help the physicians and the insurer construct a superior BP contract in which the insurer paid a lower price, providers preserved their financial margins, and patients enjoyed superior outcomes. Rather than a zero-sum negotiation, such a new contract would be a win-win for insurers, providers, and patients.
The surgeons (all physicians from Brigham and Women’s Hospital and Massachusetts General Hospital) participated because they wanted a reimbursement model that rewarded providers for delivering better medical outcomes for their patients at a lower cost. They were already measuring their patient outcomes and were in the process of introducing a costing approach that would enable them to participate in a new payments model.
Harvard Pilgrim agreed to join the effort because it recognized that traditional payment models were unlikely to help control rising health care costs. With regulators increasingly prone to challenge rate increases and employers unwilling to accept premium increases, the insurer felt that a BP model, co-created with clinicians, represented an attractive path for offering lower prices to its customers while preserving their access to the best providers.
The team has been meeting every two weeks over the past four months to design a BP model for a pilot project. The key elements of the project are the following:
Defining the Bundle
The working team selected damage to rotator-cuff tendons as the clinical condition to be bundled. Rotator-cuff repair (RCR) is a high-volume procedure with a definable cycle of care for which there is substantial variability in outcomes across physicians. Therefore, the team believed that RCR surgery offered an opportunity to improve outcomes and standardize treatment around best processes.
The team members wanted to define a cycle of care that corresponded to the medical condition of the patient. They selected a care cycle that starts with the initial pre-op appointment and concludes one year after the day of surgery. They agreed that this period would allow short-term surgical complications to emerge and be addressed within the bundle and that the recovery time would be sufficient to meaningfully measure patient outcomes.
The procedures and resources in the bundle would include pre-op appointment and testing, use of the operating room and facility services on day of surgery, surgeon, anesthesiologist and support staff, clinic visits, in-hospital drug and laboratory tests, and post-surgical physical therapy.
Two issues had to be addressed. First, although the bundle is tied to achieving measurable outcomes during the year, no business organization in any industry will wait that long for payment. Harvard Pilgrim agreed, therefore, to pay most of the bundled price 30 to 60 days after the surgical event; the remainder would be held back until the guaranteed outcome could be assessed at the 365-day mark.
The second issue was Harvard Pilgrim’s existing IT system, which had been designed to support the fee-for-service model. The insurer agreed to bypass the system and use manual procedures in the pilot study to track and bill patients and pay providers.
Selecting the Patient Population
The team’s goal was to be as inclusive as possible in specifying the patient population while incorporating the appropriate risk adjustments. The team identified a core group that would capture at least 80% of the potential RCR population. It also created risk-adjusted tranches to include patients who, based on medical evidence, had a higher intrinsic risk of failure due to medical comorbidities, age, body-mass index, and other factors and adjusted expected outcomes and a pricing differential for patients in each tranche.
Specifying Outcomes and Guarantees
The surgeons reviewed the clinical literature and their own research to select, with the insurer, the outcomes that matter most to patients. These included a mix of objectively measurable outcomes, such as rotator-cuff strength and the rates of complications that occur during operations, and subjective patient-reported outcomes such as pain, the ability to perform activities of daily living, and satisfaction with their outcomes.
The bundle incorporated the metrics in two ways. First, payments would be made to physicians and the hospital only if patients achieved specified minimal performance in each area. Second, if outcomes exceeded a more ambitious performance level, the insurer would make incremental bonus payments.
Such outcome-based guarantees and incentives are rare in traditional top-down bundled-payment contracts created without the input of frontline physicians. These contracts typically involve compliance with certain procedures (such as timely administration of pre-operative antibiotics) that may be easy to agree on and implement but may be peripheral to the ultimate patient outcome. The Boston Shoulder Institute surgeons and Harvard Pilgrim agreed that their set of metrics could provide patients better experiences and could be used to attract more patients to high-value providers.
To enhance transparency, the insurer intended to clearly communicate to patients, ahead of time, a price for the complete treatment cycle and the outcomes that could be expected. The physicians agreed to provide outcomes data to the insurer throughout the care cycle.
Ensuring Patient Engagement
Everyone recognized that the engagement of both patients and external professionals involved in the RCR cycle of care was critical for the project’s success. Toward that end, the Boston Shoulder Institute agreed to identify downstream physical therapists and to train, certify, and compensate them. The physicians also planned to conduct extensive patient pre-op education on narcotics, discharge, and physical therapy as well as provide 24-hour turnaround for all telephone calls, same-day office visits for urgent care, and a phone call from the physician’s office on the first day after surgery.
Harvard Pilgrim agreed to design new, innovative plans whose features included waiving such liabilities as co-payments if a member chose a high-value RCR provider for the surgery. The insurer expected to publicize the BP pilots through media and employer channels to attempt to drive increased volume to these high-value providers.
Estimating Costs
The Boston Shoulder Institute wanted to enter the negotiation with an in-depth understanding of all its costs over a typical RCR-care cycle, something that it could not learn from its existing costing systems. The Harvard Business School team helped the institute’s physicians and staff apply time-driven activity-based costing to measure the costs across the full cycle of care. They began by taking a careful inventory of resource needs and usage for each process in the cycle.
The figure “Initial Surgical Consultation” shows the detailed map for the first process. At each step in this process, the team identified the personnel and equipment required and measured the time consumed by each resource in performing that process step.
Process Map for Surgical Office Consult Visit

The team then accessed data from hospital and physician departmental budgets, the human resources system, and the equipment and facilities databases to estimate the “capacity cost rate,” the cost per minute of each person and piece of equipment used in the care cycle. It also calculated the cost of space used by each resource or clinical and administrative process. The team combined the time and cost estimates to obtain the total cost for surgical treatment of rotator-cuff tears.
Setting the Price
Going into the price negotiation, the Boston Shoulder Institute’s aim is to achieve better patient outcomes and thereby earn a margin over the actual costs incurred. This will come in several ways: the bonus payments for consistently producing superior outcomes; more business driven to them by the insurer because of the better outcomes; and, with a higher volume of patients, more cost-efficient processes. Harvard Pilgrim’s objective is to achieve a bundled price that represents a discount from its fee-for-service payments to facilities, clinicians, and therapists for the RCR care cycle (along, of course, with the superior outcomes). Looking down the road, it believes that if it can extend the new BP model to other conditions, it will be able to reduce its premiums and differentiate itself by offering superior, guaranteed outcomes.
Boston Shoulder Institute physicians and Harvard Pilgrim are now waiting for senior management at Partners HealthCare, the parent of Brigham and Women’s Hospital and Massachusetts General Hospital,  to review the proposed bundle and to negotiate the price for a trial period. The trial would allow the physicians, hospitals, and therapists to learn how to work together under the new arrangement and set the foundation for a long-term contractual relationship.
***
Throughout the project, the Harvard researchers have kept the discussions focused on the prize: aligning provider and insurer incentives to deliver more patient value. The interactions have given the providers confidence that the costs assigned to the clinical treatments were accurate and have assured the insurer that the provider’s costs will be be based on clinical best practices and high capacity utilization. Over time, as more provider organizations agree to outcome-based bundles, Harvard Pilgrim believes an informed market will introduce competitive pressures to sustain a fair sharing of value between providers and insurers.
All participants have been impressed by the collaborative ethos of the working group. Conversations are open and frank. Rather than a traditional negotiation about who bears which costs, the face-to-face interactions have built trust that is enabling the insurer and physicians to arrive at a win-win value-based solution.

Smart Rules: Six Ways to Get People to Solve Problems Without You

THE MAGAZINE
http://hbr.org/2011/09/smart-rules-six-ways-to-get-people-to-solve-problems-without-you

Artwork: Jen Stark, Tri Angular, 2010, Acrylic paint on wood, 35" x 35" x 25"

Companies face an increasingly complex world. Globalization and technology have opened up new markets and enabled new competitors. With an abundance of options to choose from, customers are harder to please—and more fickle—than ever. Each day competitive advantage seems more elusive and fleeting. Even if you can figure out the right approach to take, what works today won’t work tomorrow.
The growth of complexity is reflected in businesses’ goals. Today companies, on average, set themselves six times as many performance requirements as they did in 1955, the year the Fortune 500 list was created. Back then, CEOs committed to four to seven performance imperatives; today they commit to 25 to 40. And many of those requirements appear to be in conflict: Companies want to satisfy their customers, who demand low prices and high quality. They seek to customize their offerings for specific markets and standardize them for the greatest operating return. They want to innovate and be efficient.
In and of itself, this complexity is not a bad thing—it brings opportunities as well as challenges. The problem is the way companies attempt to respond to it. To reconcile their many conflicting goals, managers redesign the organization’s structure, performance measures, and incentives, trying to align employees’ behavior with shifting external challenges. More layers get added, more procedures imposed. Then, to smooth the implementation of those “hard” changes, companies introduce a variety of “soft” initiatives designed to infuse work with positive emotions and create a workplace where interpersonal relationships and collaboration will flourish.
At the Boston Consulting Group, we’ve created an “index of complicatedness,” based on surveys of more than 100 U.S. and European listed companies, which measures just how big the problem is. The survey results show that over the past 15 years, the amount of procedures, vertical layers, interface structures, coordination bodies, and decision approvals needed in each of those firms has increased by anywhere from 50% to 350%. According to our analysis over a longer time horizon, complicatedness increased by 6.7% a year, on average, over the past five decades.
This complicatedness exacts a heavy price. In the 20% of organizations that are the most complicated, managers spend 40% of their time writing reports and 30% to 60% of it in coordination meetings. That doesn’t leave much time for them to work with their teams. As a result, employees are often misdirected and expend a lot of effort in vain. It’s hardly surprising that employees of these organizations are three times as likely to be disengaged as employees of the rest of the group—or that dissatisfaction at work is so high and productivity so often disappointing.
Companies clearly need a better way to manage complexity. In our work with clients and in our research, we believe, we’ve found a different and far more effective approach. It does not involve attempting to impose formal guidelines and processes on frontline employees; rather, it entails creating an environment in which employees can work with one another to develop creative solutions to complex challenges. This approach leads to organizations that ably address numerous fluid and contradictory requirements without structural and procedural complicatedness.
The approach incorporates a set of simple yet powerful principles. We call them “smart rules.” These rules help managers mobilize their subordinates’ skills and intelligence.
There are six smart rules. The first three involve enabling—providing the information needed to understand where the problems are and empowering the right people to make good choices. The second three involve impelling—motivating people to apply all their abilities and to cooperate, thanks to feedback loops that expose them as directly as possible to the consequences of their actions. The idea is to make finding solutions to complex performance requirements far more attractive than disengagement, ducking cooperation, or finger-pointing. When the right feedback loops are in place, cumbersome alignment mechanisms—ranging from compliance metrics to the proliferation of committees—can be eliminated, along with their costs, and employees find solutions that create more value.

Thursday, October 10, 2013

Black Dogs: The State of Mental Health in the Workplace

International Business Times UK
http://www.ibtimes.co.uk/articles/512065/20131008/mental-health-mind-research-cbi-tv-celebrity.htm
 

Work stress


Work can take a toll on your physical and mental well-being. According to mental health charity Mind, one in six employees experience mental health problems, including stress, anxiety and depression.
In fact, the organisation discovered that work is the most stressful factor in people's lives. More than a third (34%) of 2,000 respondents to the charity's survey published in March, for example, said their work life was "very" or "quite" stressful.
Work related mental health problems are an issue too important for businesses or employees to ignore. So in the run up to World Mental Health Day on Thursday, IBTimes UK takes a lot at the state of mental health in the workplace.
Stigma is a dangerous beast.
It can stop people addressing issues, however big or small. Mental health stigma is particularly hazardous. By making a sufferer feel insecure about highlighting their situation, workers with mental health conditions may never tell their employer about it. But, fortunately, mental health stigma is decreasing at work, according to one insurer.
Aviva's Health of the Workplace 2012 report revealed that just over a quarter (28%) of employees said they feel there is less stigma associated with mental health in the workplace than there was in October 2011. For those that feel that the stigma has decreased, just under half (48%) say it is because mental health is better understood.
In addition, more than a third (36%) of employees say that TV and press campaigns have helped remove the stigmas associated with mental health and 28% feel that celebrities' willingness to openly talk about their mental health issues have played a part.
But even though stigma is fading, stressed workers are suffering in silence and bosses are not doing enough to tackle the problem, according to Mind.
The organisation's latest survey, published in October, found that employees are expected to cope without mentioning stress at work and that nearly a third felt unable to talk to their line manager if they felt stressed.
So what can employees and employers do to help workers who are suffering?
Conversation
Eugene Farrell says workers should be able to have conversations with their employers (Reuters)
Communication
A healthy working environment is one in which there is not only an absence of harmful conditions but an abundance of health-promoting ones, according to the World Health Organisation. That is why it is important for employees and employers to communicate mental health issues.
Eugene Farrell, of AXA PPP healthcare, says: "If people are in any kind of crisis, they should be able to seek appropriate help."
He adds: "It's down to culture and getting people to speak out. Just being able to have those simple conversations would be a huge benefit to organisations."
But what if an employee is reluctant or scared to highlight their mental health problems, how else can an employer help? Well, Dr Jill Miller, a research adviser at the Chartered Institute of Personnel and Development, argues that line managers are ideally placed to spot any early warning signs of mental health issues in workers.
"If someone is feeling stressed, anxious or distressed, there may be some behavioural signs that that could be a problem," Miller explains.
She adds: "But there there's no set things to look for because stress, anxiety and depression manifests themselves in different ways - some people may turn up to work late, some people may have stomach upsets."
Work stress
The Work Foundation says flexibility helps combat stress (Reuters)
Action
Employers should offer employees some flexibility in their work schedule to manage mental health issues, according to the Work Foundation. The Work Foundation Body and Soul 2010 report argues that flexibility will make managing workers chronic physical and mental health conditions easier, as well as managing employees' workload.
Andy, a media professional who wished to remain anonymous, says his employer's flexibility helped him battle depression.
"Going to human resources was probably one of the best decision I've made," Andy explains.
"I was able to speak to a very highly qualified and very experienced professional on a one-to-one basis."
Andy says at the peak of his depression he could not do his jobs and his employer's assistance was key to helping him get back on track.
He adds: "I also felt that my employer was very sympathetic and they wanted to help me.
"I was able to get time off straight away, for instance, which enabled me to chill-out and get away from work. That breathing space allowed me to deal with my underlying issues."
Andy's employer is not alone in helping their employee with mental health issues. More than nine out of ten (92%) of organisations operate stress and anxiety management policies, according to Confederation of British Industry and Pfizer.
The 2013 CBI/Pfizer Absence and Workplace Health Survey, which gathered responses from HR practitioners and managers in 153 organisations across the UK's public and private sectors, found that two-thirds (68%) of larger businesses operate formal mental health policies, compared with just under a third (30%) taking an informal approach.
One such large employer is professional service firm Deloitte.
Churchill
Former Prime Minister Winston Churchill described his depression as his
Black Dogs
The employer is working with mental charity SANE, to help reduce stigma around mental health and to encourage staff to come forward to tame their "black dog", a term Winston Churchill coined to describe his own depression.
The firm has sponsored a black dog statue, with the aim of helping people define their experience of the "invisible" condition, as well as promoting more open discussion, understanding and acceptance around mental health.
Deloitte has also founded the Mental Health Champions, a group of partners at the firm who have been trained to have the initial conversation with any employee who feels like they might have a mental health issues.
As well as that, the employer has an occupational health service on site and an employee assistance programme.
"I offer a confidential adviser service to people in the firm who might be worrying about suffering from a mental health issue," John Binns, an ex-partner at Deloitte, who suffered from depression in 2007, explains.
He adds: "There's quite a range of things that we have in place, which we have been building up over the last five years.
In between the hustle and bustle of everyday office life, workers' psychological well-being can be overlooked.
But it is very important that this does not happen. Thankfully, recent research is positive on mental health issue: stigma is declining and awareness is increasing. But there are some problems - like employees suffering in silence - that still remain.
It is imperative, therefore, that companies continue to help workers tame their black dogs.

Getting Big Results from a Small Business Unit

http://blogs.hbr.org/2013/09/getting-big-results-from-a-small-business-unit/
by Steven J. Thompson

4

Earlier this year Sun Yat-sen University, a well-regarded institution in Guangzhou in the Guangdong province of China, announced that the university and affiliated hospitals were entering into a novel collaboration with Johns Hopkins Medicine. The agreement would see Hopkins faculty working bilaterally with Sun Yat-sen’s medical faculty both in China and at Hopkins in order to help the university become a world-class biomedical research institute. The deal has significant implications for U.S. hospitals because, facing declining revenues, international collaborations like these offer a new path for growth.
It was the 30th major, revenue-producing, international healthcare collaboration for Johns Hopkins Medicine, with several more currently under negotiation — when the rest of the world combined has perhaps a few dozen similar partnerships. One reason Hopkins is outpacing others is because it created an agile satellite unit – Johns Hopkins Medicine International (JHI) – within the much larger parent organization solely dedicated to these projects.
JHI’s activities illustrate how large healthcare organizations, often bound by size, complexity and conservatism, may need to turn to satellite units if they are going to tap into the innovation and flexibility needed to explore new opportunities for growth. But to be effective, such units have to cultivate key differences from their parent organizations, while at the same time maintaining close ties to the mother ship and adhering to its main tenets.
The Sun Yat-sen project offers a good example of how JHI took advantage of its smaller size, specialization and agility to identify, structure and close an ambitious, unusual and potentially highly rewarding deal that might well have eluded the main organization. It’s well known how difficult it is for large U.S. companies to do business in China profitably, if at all, and even many of our fellow private academic institutions have struggled in their efforts to establish partnerships in China. Our success depends on a set of capabilities any healthcare organization will need in venturing into similar international deals. They must:
Seek out novel relationships and challenges. Large U.S. healthcare organizations like JHM tend to enter into types of partnerships that don’t require them to operate in a substantially new way such as with other large domestic healthcare institutions, or with local hospitals.  Our unit, however, is set up to be more attuned to different types of opportunities. We have staff on the ground throughout Asia and the rest of the world to network and look for potential collaborations like the one in Guangzhou, which, being far from Beijing and Shanghai, fell under everyone else’s radar. The proposition for this collaboration would have had most executives at large medical institutions scratching their heads — there are no clear models for how to help another university develop its research expertise. We didn’t have a model to work with either, of course, but we were willing to innovate and develop one from scratch to make the collaboration work. We routinely partner with private investors, ministries of health, non-healthcare corporations, and other players who aren’t part of typical healthcare deals with U.S. academic medical centers.
Maintain unusual expertise. JHM’s strong reputation in patient care, research and education provides us with an invaluable brand halo that opens doors and motivates partnerships, and defines our mission. But striking international deals calls for a range of other competencies that our parent organization and others like it would have trouble assembling and deploying. These include being familiar with the variation from country to country of social norms, healthcare traditions, religious influences, negotiating tactics, contract law, effective local sales and marketing strategies, media coverage, and political influence. How many healthcare organizations are equally comfortable dealing with government officials in Asia and royal family members in the Persian Gulf? Or are capable of predicting how the next election in a small, developing nation is likely to affect hospital revenues there? Our teams deal with these sorts of offbeat challenges every day, and if we don’t have a resident expert we know how to get one. Critically, for every region we have a dedicated manager capable of championing a project there.
Embrace risk. Hopkins’ reputation is its greatest asset. But it also leads to an organizational culture that tends to shy away from doing anything that risks denting that reputation in any way. A sound policy, to be sure, but one that can sometimes pull the organization away from potentially rewarding opportunities. Our unit also places a high priority on protecting our parent organization’s reputation. But because of our experience and focus, we’re better able to understand and manage the risks associated with international collaborations that JHM itself might be. For example, we allow some of the hospitals that collaborate with us in other countries to identify themselves as Johns Hopkins Medicine International “Affiliates,” but only when we’re intimately involved in setting up, monitoring and maintaining patient care and safety processes and standards. The joint research coming out of our Guangzhou collaboration will bear the Hopkins name, but only in those cases in which Hopkins researchers have played a meaningful role. We also structure our deals in phases, typically starting with pilot projects and moving gradually into more extensive and challenging levels, so that if we have misjudged the risk in a project we’ll catch it early and be able to step away before any real damage is done.
Move with agility.  John Hopkins Medicine is a massive, complex organization that prefers to move into partnerships with great deliberation, because a large number of decision-makers have to buy in, and because there’s more risk in acting quickly. But when a health ministry or a group of private investors in a small country give a big health care project a green light for funding, they’re not going to wait around for two years for a potential partner to sign on. So we’ve developed business processes that enabled rapidly pulling together a team to efficiently evaluate the Sun Yat-sen opportunity, perform due diligence, structure the deal, line up the resources needed to live up to our end of it, set up contracts, and present JHM — which still has to approve all our deals — with a solid, complete package that can be decided on relatively quickly, all within six months. It helps, of course, that we’ve earned the trust of JHM decision-makers over the years, that I myself am a senior vice-president of JHM in addition to my role leading the international innovation unit, and that we consult with key JHM executives every step of the way so that there are no surprises.
The result of these competencies is that our satellite unit has been able to help the mother ship extend its health care mission globally. That’s a huge payoff to the entire organization–even before factoring in the substantial revenues that have come along with these projects.