Supervisor Amsterdam Business School MBA Healthcare Dr. Martijn F.L. Rademakers Managing director of the Center for Strategy & Leadership; Adjunct Professor of Corporate Strategy, Amsterdam Business School, UvA Faculty supervisor: Prof. dr. Marco J.P.F. Ritt Head of department Plastic Reconstructive and Hand Surgery, VUmc Contact information: Margriet G. Mullender, Ph.D. Department of Plastic, Reconstructive, and Hand Surgery VU University Medical Center Amsterdam P.O. Box 7057, 1007 MB Amsterdam, The Netherlands Tel: +31(0)20 44 41 426 m.mullender@vumc.nl
The two academic hospitals in Amsterdam, VUmc and AMC have announced to be working towards a merger. Plans are to keep both locations and to lateralize care‐ and research themes to one of either locations. The implications for the two departments of Plastic Surgery are as yet unclear. Still, with many changes in the internal and external environment, both departments have to rethink their strategies and with the merger at hand, it seems wise to combine these strategies. Aim This study aims to investigate whether an approach can be found that leads towards a flourishing and effective collaboration, coping with the changing macro‐ and micro‐ environment. Framing Based on management theories of opinion leaders, and based on some observation studies, my assumption is that for collaboration, and possibly even a merger, to be successful, it is essential to appraise the missions and visions of the two departments and to align these in order to develop a mutually supported strategy. Methods I developed a questionnaire with question addressing issues related to mission, vision, strategy, and alliance with the sister department. All medical staff members of both departments (plastic surgeons) were asked to complete the questionnaire. Hereafter, I conducted semi‐structured interviews based on the questionnaire. Transcripts were made of the interviews, which were analyzed qualitatively. Results Views on mission were quit similar. Patient care, research and education were seen as core tasks. Patients were viewed as the primary customer, and other specialists as secondary customer. Delivering high quality care was seen as the main reason for being. Values (and culture) were not only regarded as very important, but also as a unique asset. Openness, honesty, communication, respect, pleasure, collegiality and professionality are examples of important values. Both departments valued team‐work and team spirit very highly.
3 Environmental changes were viewed similarly by most staff members. Problems currently encountered were specific for each group. Where in VUmc fragmentation of the team caused most problems, in AMC understaffing and lack of support was most problematic. With regard to vision, views varied somewhat. There were various levels of ambition, various views on whether or not to collaborate within the region, some wanted more focus, while a few wanted to diversify. However, deliverance of high quality care was a part of everybody’s vision, always combined with research, innovation and education. Everyone reacted positively to collaboration between departments. Some cautiously, some resolutely. Envisioned hurdles for fruitful collaboration were the question who should be the leader, cultural differences, lack of shared vision, and insufficient integration. Implications Similarities between departments are much greater than differences, especially with respect to mission and value proposition. This implies that there should be a good basis for collaboration. Actually it seems that the challenges to adapt to the changing internal and external environment are greater than those associated with a collaboration. Views on how to deal with these challenges are more variant amongst the AMC staff than amongst the VUmc staff. This could be due to the fact that the VUmc staff have already chosen to cross the boundaries of their academic center as a team. In order to reach a sustainable alliance, one should consider the value proposition (delivering high quality PCH care) and the value chain. Which business system and organizational system are most suited and how to align people development are strategic questions to be solved. Conclusion and recommendation Collaboration seems feasible based on commonality in views on many aspects of mission, vision, strategy and alliance. However, some work has to be done to achieve a common strategy. Since presently there is no mutually accepted leader of the collaborative team, a shared, evolutionary strategy, developed by dedicated team members may be the best way to start. However, some fundamental choices have to be agreed on first with respect to the boundaries of the organization and the association with “parent” organizations. After the initial phase, a decision about leadership should be made, which will accelerate the process of change and should then be organized in a more structured way.
0. Abstract ... 2 1. Introduction ... 6 1.1 What preceded this research? ... 6 1.2 The two departments of Plastic Surgery... 7 1.2.1 Department PCH VUmc ... 9 1.2.2 Department PCH AMC ... 10 1.2.3 Collaboration ... 10 1.2.4 Premises ... 11 1.3 Research objective ... 12 1.3.1 Theoretical background ... 12 1.3.2 Approach: mission comes first ... 13 1.3.3 Research questions ... 13 2. Methodological approach ... 15 2.1 Questionnaire development ... 15 2.2 Semi‐structured Interviews ... 16 2.3 Analysis ... 16 3. Results ... 18 3.1 Summation of the results ... 22 3.1.1 Mission ... 22 3.1.2 Vision ... 23 3.1.3 Strategy ... 24 3.1.4 Alliance ... 25 3.2 Similarities and differences ... 26 4. Implications ... 27 4.1 Value proposition and Business development ... 28 4.1.1 Looking at the value chain for plastic surgery ... 29 4.2 Organizational development and Boundaries of the organization ... 30 4.3 People development ... 32
5 5. Conclusions and recommendations ... 33 5.1 Compatibility ... 33 5.2 Recommendations ... 34 5.2.1 Theoretical intermezzo ... 34 5.2.2 How may we approach our strategy making? ... 35 6. References ... 37 7. Acknowledgement ... 38 8. Appendix A Questionnaires ... 39 9. Appendix B Mission statements and some BHAGs ... 42 9.1 Mission statements: ... 42 9.2 BHAGs: ... 43
1. Introduction This thesis investigates the similarities and differences in motivation, incentives, views, and objectives between the medical specialists of the department of Plastic, Reconstructive and Hand Surgery in the Academic Medical Center (AMC) and those of the equivalent department in the VU University Medical Center (VUmc). A foundation is sought for collaboration between the two departments, which is based on a shared mission, and a common vision. 1.1 What preceded this research? Far‐reaching changes have transpired with regard to the Dutch healthcare system. The system of a “regulated market” for healthcare, which was introduced in the Netherlands in 2006, is still a source of great uncertainty, as the new system is as yet far from reaching stability. Insecurity about the purchase of care products by the healthcare insurance companies, the negotiation about the prices for these products, and the continuously changing healthcare policy complicate strategical decision‐making in healthcare organizations. In light of these developments, some years ago the boards of directors of both the AMC and the VUmc expressed their intention to work towards merger of the two academic hospitals. Likely, the boards envisioned a better competitive position for a single merged academic hospital than for two separate academic centers in the same city, Amsterdam. The boards initially talked about an alliance (alliance is interpreted in this document as collaboration between partners, without becoming one legal entity), rather than a merger (merger defined as becoming one new legal entity). Probably because the Autoriteit Consument & Markt (ACM) needs to approve mergers (but also collaboration), between hospitals, and possibly to avoid too much unrest among employees. In this phase, department heads of parallel departments were asked to confer about the alliance and manners of collaboration. However, the overall strategy and direction of the alliance was yet unclear. At the end of 2013, it was clear that the boards strived for a merger. However, the ACM decided at the beginning of 2014 that a merger was lawfully not possible with the legal
structure of the VUmc. For this reason a separation of VUmc and the VU University was instigated. In 2014, a vision document1 was published in which reasons for the merger were briefly explained, and grand ambitions were stated. It was stated that both hospital locations (VUmc and AMC) will be maintained in the years to come. The boards publicized the intended allocation of selected main care and research themes to either of the two locations. This vision document informed us to some extent about the direction that the boards intend to go, but also leaves many questions unanswered. Especially for the departments which are not central to “the chosen themes”, the announced plans have not provided much clarity about the consequences of the merger for these units. For these departments, the day‐to‐ day business continues and most leaders have adopted a “wait and see” approach. The specialty Plastic Surgery is one of the specialties for which the consequences of the merger are still unclear. Parallel to the developments with regard to the merger, other major projects were initiated in both hospitals. Both centers started implementing an electronic medical record, a huge operation, causing much strain in the organizations. Also, both hospitals embarked on a quality certification process based on the Joint Commission International (JCI) criteria in AMC and according to the Nederlands Instituut voor Accreditatie in de Zorg (NIAZ) criteria in VUmc. Again, projects which need additional time and effort of clinical personnel. Whereas AMC has been cutting back on expenditures over some years, the VUmc started a 5 year savings program in 2014. 1.2 The two departments of Plastic Surgery Subject of this research are the departments of Plastic, Reconstructive, and Hand Surgery (PCH) of VUmc and AMC. The three tasks in both departments are clinical care, education, and research. Both are relatively small departments in comparison to other specialties. The organizational hierarchy is traditional and similar in both hospitals, with the heads of the departments in the third layer of management. A schematic drawing of both organizations is shown in Figure 1. An overview of the organization of both departments of PCH is given in Figure 2. In both departments clinical care is leading. Both have a specialty training program for plastic surgery
residents and both departments are involved in research. In AMC the clinical staff comprises 4.8 fte medical specialists, in VUmc this is 6.8 fte. The VUmc department also has one research staff member (0.89 fte) and two professors by special appointment (0.2 fte each). The VUmc department additionally includes the personnel of the outpatient clinic, which is dedicated to PCH. In AMC, the outpatient clinic is not included in the department, but it is a shared function managed as a separate division. Plastic surgery is a surgical specialty with a very broad scope. It ranges from very complex (re)constructive (micro)surgery to cosmetic treatment, and, in the Netherlands, it also includes hand and wrist surgery, a sub‐specialism which in many other countries is an element of orthopedic surgery. In the academic hospitals, plastic surgery comprises mostly more complex reconstructive surgery, which focusses on repair of congenital defects, defects due to trauma, or defects created by other surgeons, because of oncological or infectious processes. Also, more complex hand and wrist surgery is performed in these centers. However, each academic group has its own focus areas. Figure 1 Organograms of VUmc and AMC. The hierarchical organization in both hospitals is similar. Departments are organized in divisions, which are headed by a division chair. They are accountable to the Board of directors (RvB). The board of directors has ultimate responsibility. OR=ondernemingsraad; SC=stafconvent; VA=verpleegkundig adviesraad;CR=clientenraad; SR=studentenraad
VUmc AMC Figure 2 Organograms of the two departments of PCH. 1.2.1 Department PCH VUmc As stated above, clinical care is leading in the department. With a hand surgeon as the department head, hand and wrist surgery is one of the focus areas. Complex reconstructive surgery, including reconstruction of complex bone defects, breast reconstructive surgery, and genital surgery is a leading focus area. Furthermore, treatment of lip clefts (schisis) and wound/scar management are important topics in this department. Reconstructive surgery, as well as schisis treatment are typically multidisciplinary treatments. Some of these treatments (e.g. gender dysphoria treatment) are formalized in multidisciplinary care paths, but many treatments are individual complex cases. In all of these cases good multidisciplinary collaboration is essential. Over the last five to ten years, the department has undergone major changes. It transitioned from a simple, small organization (5 staff members, 3 AIOS and 3 support staff) to a larger, much more complex organization (11 staff members, 9 AIOS and roughly 25 other personnel). Not only did the clinical staff grow, a specific PCH outpatient clinic became part of the organization and research was extended with the appointment of two professors by special appointment, and a research staff member. On top of this, the specialists began to work in multiple independent centers, which has been formalized in various forms of cooperation. This rapid growth, the multiple work places and the increasing work pressure have increasingly led to problems being encountered in the day‐to‐day work. These problems vary between difficulties with OR planning and OR allocation, critical lack of space in the outpatient clinic, communication, planning and scheduling, planning of multidisciplinary collaboration, and problems related to the multiple work places and collaborations with
peripheral centers. Moreover, increasing work pressure, overflow of administrative tasks, and frustration with extensive negotiations and the excessive bureaucracy are complaints that are increasingly being voiced. Besides the apparent inefficiency, there is a genuine risk that our staff becomes demoralized and strained. 1.2.2 Department PCH AMC Plastic Surgery in the AMC is a stable organization with a core group which has been working in the department for many years. Also here, clinical care is leading. One of the main focus areas is complex reconstructive surgery, with special expertise in complex wrist reconstructions. Also reconstructive surgery of congenital malformations and venous malformations are focus areas. Various plastic surgeons in the AMC have a specific expertise in a highly specialized “niche”, were they treat specific difficult cases, sometimes even as a European referral center. The department has remained more or less unchanged in size. With a relatively small staff, they maintain a high standard of care, whilst training plastic surgery residents, and supervising research. Although the department has less complexity, the plastic surgeons experience similar stresses as those in the VUmc department with regard to work pressure, the changes in the macro‐environment and the hospital microenvironment. 1.2.3 Collaboration Within both departments PCH there is a call for improvement. In VUmc, the staff experiences a sense of urgency for evaluation and a reassessment of the department strategy and its organization. In AMC, there is a need to reduce the burden of work, and to improve the support. In light of the intended merger of the academic centers, the changing healthcare climate, and the need to revisit the departmental strategies, it makes sense to formulate a mutual strategy for both departments of PCH. Presently, there is a good understanding between the two department heads, the staff members, and also the residents. Some initial initiatives have been taken for collaboration with regard to schisis treatment and complex bone reconstruction. However, no clear plans have been made for more extensive collaboration, and so far it has proven hard to get this common ball rolling.
1.2.4 Premises 1. A merger of departments PCH is foreseeable, but when and how this will take effect is unknown. As described above, AMC and VUmc strive for a merger. The timeframe which has been delineated for the merger/integration is a multiannual program with the horizon set at 2030. Priorities for the next five years do not directly involve the departments of PCH, but may have indirect effects. Supposing that the ACM will indeed approve the intended merger, we can assume that at some point in the future merger of both departments PCH will take place. Hence, the question is not if this merger occurs, but how and whether the departments will anticipate and reorganize themselves, or wait and see. 2. The stated ambition level of the overall merger is too broad to give a clear focus. When looking at the overall aims of the merger, the stated ambitions are sky high; to be the best in education, to be number one in research, to offer the full range of complex, academic care, to offer the highest complexity care (“top referente zorg”), to improve care by concentration of care, and simultaneously, to improve efficiency by deduplication of services and costly infrastructure. The question is which of these ambitious aims are leading. 3. Until the merger is a fact, departments have to conform to the policies of the separate centers. Until the merger is a fact, both hospitals are governed independently. Policies are not always in line. Also, since VUmc is in a critical financial position with regard to liquidity, short term policy is not always aligned with the stated long term ambitions. Collaboration in the run‐up to the merger may conflict with the interests of the separate departments. Of course, survival during the merger process is a prerequisite.
1.3 Research objective The intention is to see whether an approach can be found that leads towards a flourishing and effective collaboration, coping with the changing macro‐ and micro‐environment. This should ultimately lead to one overall department PCH. The question is what approach should be taken? 1.3.1 Theoretical background In the management literature, many authors emphasize the importance of good leadership, especially in an effort to transform a business. In today’s world, with the rapid developments in information technology, we can state that conditions are never stable, and constant adaptation is imperative for survival. In other words, good leadership is imperative for survival of the organization. Good leadership is often described as inspirational2 (Steve Jobs is probably the most cited leader in this respect), and transformational3 leadership. These theories converge around the idea that charismatic or transformational leaders communicate an inspiring vision that provides a sense of meaning and purpose4. The latter (communicating vision that provides meaning and purpose) might well be the most important part. As Peter Drucker put it: “What matters is not leader’s charisma. What matters is the leaders’ mission. Therefore the first job of the leader is to think through and define the mission”5. Also Collins and Porras6 emphasize the importance of having a clear mission. They define the mission as “the core values and core purpose of a business that remain unchanged over time”. It defines our consistent identity, the essential and enduring tenets of our organization and our reason for being. They state that great companies have a clear sense of why they exist – their core ideology (mission) – and where they want to go – their envisioned future (vision). The way to inspire and create the organizational commitment to this goal is to communicate a Big Hairy Audacious Goal (BHAG). In a classic paper on change management, Kotter states that “leading change is both absolutely essential and incredibly difficult”. Based on a vast experience, he describes 8 stages and associated actions which give the best chance of successful transformation7. The first 3 steps are: 1. Create a sense of urgency, 2. Form a powerful guiding coalition, and 3. Create a vision.
There are a few opinion leaders who specifically address strategy in healthcare settings. Probably, the most referenced are Porter and co‐authors8,9, who, in recent years, have advocated a total change in the general healthcare strategy. The basic idea is that “value creation for the patient” should be leading in the healthcare strategy (while this value is also revisited). In their view, this is best organized by changing from a “functional layout” (resource based – per specialty) towards a “product layout” (service based – organized by medical condition). Another well‐known author in the field is Kaplan. Together with Norton and other co‐authors he has produced a multitude of papers in the general, and the healthcare management field.10 Central to his approach is first the definition of mission and vision, then planning of a strategy, and importantly, measuring results in order to adjust. He advocates the use of a balanced score card to measure results from four different perspectives: financial, customer, internal processes, and learning. Both Porter and Kaplan have a similar approach to strategy making in the sense that it is in line with Deming’s11 Plan‐ Do‐Check Act (PDCA) cycle approach to management; Mission/value proposition comes first, developing vision is next, and strategy making follows. Both also place great emphasis on measuring outcomes to be able to adapt and learn. In all cases, the process starts with the mission and value proposition. 1.3.2 Approach: mission comes first Supported by these opinion leaders, my assumption is that for collaboration, and a subsequent merger to work, it is essential to appraise the missions and visions of the two departments and to align these in order to develop a mutually supported strategy. Some support for formulating mission statements is given by a few studies on the impact of mission statements on the performance of healthcare providers.12,13,14 The authors concluded that rationales for developing mission statements, mission statement content, and the involvement of stakeholders in mission statement development are associated with performance. 1.3.3 Research questions Mission is defined as the core values and core purpose of the department PCH. Vision is defined as the envisioned future or goal of the department PCH. In this research I intend to
appraise the views on the mission and vision of the department PCH of all members of the staff of both departments independently. The central questions that I want to address are: a. What do plastic surgery staff members of AMC and VUmc perceive as the core values and core purpose of their department? b. How do staff members of both departments envision the future of their department or academic plastic surgery in Amsterdam and what are the underlying surmises? c. What is their view with regard to collaboration between both departments? d. What are the differences and what are the similarities between the views of the staff members and department heads? e. Based on the outcomes, what conclusions can be drawn about possible routes for integration and what are the strategic and organizational consequences?
2. Methodological approach The objective of this study is to assess the individual opinions and views of staff members. Specifically I wanted to understand how staff members think about a number of issues regarding their own department PCH and collaboration with the corresponding department. Ultimately, this study aims to lead to a practical advice towards the department heads and staff members on how to proceed towards a fruitful strategic alliance. In other words, this study addresses a consultancy question rather than a scientific question. Therefore, the applied methodology is a pragmatic method rather than a scientifically based methodology. A qualitative method is used. Briefly, I approached both department heads and asked them if they were willing to participate in this study. After obtaining their consent, I developed questionnaires with open‐ended questions. I invited all staff members to participate in the study. To further introduce the study, I gave a short presentation about the aims of the study at a staff meeting in each of the departments. The participants were then asked to complete the questionnaires in preparation for the interview. The 17 interviews were scheduled over a two months’ time period. A semi‐structured interview was conducted with each participant based on the questionnaires. After completion of all interviews, analyses were performed. 2.1 Questionnaire development I developed a questionnaire comprising three main topics: 1) Mission, 2) Vision, 3) Strategy and Alliance (appendix A). The key concepts used for “mission” and “vision” were taken from the general literature on management. The mission is supposed to provide answers to the following questions: What are we? Why do we exist? What do we do? For whom? What are our core values? The vision states what we want to accomplish in the future. It implies an idea of the future organization, but also of the relevant environmental changes. It should answer the following questions: What do we want to achieve? Where do we stand as an organization in 5 years?
What is the relevant environment for our organization in the (near and distant) future and what is our position in it? With regard to strategy, I combined a selection of questions, mainly to find out what the participants wanted to remain unchanged and which changes they felt were necessary. I also wanted to obtain their view on what steps should be undertaken to accomplish the vision, and whether an alliance with the parallel department would fit in this vision. The questionnaire was checked by both supervisors and improved based on their suggestions. 2.2 Semi‐structured Interviews I conducted semi‐structured interviews with all clinical staff members of both departments, i.e. 10 VUmc staff members and 7 AMC staff members. The interview was semi‐structured in the sense that the questionnaire was used as a guideline. The interviews were initiated by a question about the position of the staff member in the department and why they had chosen for this position. In VUmc, I also asked what staff members defined as “the department”, whether this included or excluded the current collaborations outside the VUmc hospital building. The interviews usually lasted just over an hour. The interviews were recorded and afterwards transcribed by a research assistant. In addition, notes were taken by the interviewer during the interview. 2.3 Analysis For the analysis, all transcripts were read at least three times. Hereafter, important statements were demarcated using highlights. A number of “main items” was selected based on the questions in the questionnaire and the conducted interviews (Table I). The transcripts were methodically examined again and central statements with regard to the selected items were labelled. The labelled sentences of all participants were then collected per item in one Table. If appropriate, the statements were ordered in categories which enabled comparison between the types of answers. This gave an overview of answers per selected item. Following this categorization, the results of the members from the two departments were compared and similarities and differences within and between departments were established.
Table I Main items along which the interviews were analysed for stated views of the participants.
Mission Vision Strategy
Identity Achieved in 5 years’ time Improvements
Reason for being Relevant external changes Urgent changes / developments
Customer Influence Steering parameters
How are we different Proud / satisfied Alliance
Values Future department What to prevent
Mission statement BHAG First step
Successful department Hurdles
3. Results All staff members were very willing to participate in the study. Many were positive about the initiative and thought that this was a good start for further exploration of collaboration possibilities. Since the interviewer (me) is a staff member of VUmc, and therefore more familiar with the VUmc staff, it is possible that VUmc participants felt more at ease. However, this did not seem to be the case, as the AMC participants were very open and cooperative as well. Interviews were conducted successfully with all participants. A central statement or sentence was collected from each participant for each selected item (Table 1). These were then ordered according to three possible routes: 1. Statements could be categorized into certain “types of answers”, within these categories, different opinions are grouped. 2. Statements reflect a mutual overall answer, but with individual nuances. 3. Statements reflect different opinions, subcategorization does not make sense. The results are summarized in Tables II‐V.
Table II Summarized results for Items related to Mission Item Identity Content VUmc Mainly clinical department; Broad span of PCH services; High expertise in focus areas AMC Complex care; Providing service to other specialties Culture VUMC Progressive; Dynamic; Accepting each other as they are; Versatile AMC Close group; Service‐oriented; Solution‐oriented; Strong Core purpose All: Patient care Research Education VUmc to outshine, be first‐rate, top‐level AMC to deliver complex care, to provide service Customer All: Patients, Other Specialties, Referring Physicians Residents Difference / Unicity Content VUmc Individual surgeons, specific expertise, specific subspecialties, broad spectrum AMC Innovation Referral patterns Culture VUmc Team spirit, solidarity, unity, fellowship AMC Stable, reliable group, accessible, easy‐going Values All: Collegiality, Ambition, Commitment, Professionalism, Quality, Communication, Personal Development, Pleasure Mission statement VUmc Patient is central – providing better and better care for the patient + Ambition (being the best) AMC Patient is central – providing better and better care for the patient Successful department Summarized for all: "A group with the same intent, which clearly knows where she wants to go, optimized patient care, being able to provide this care, and innovation." Individual accents: top‐level, leading, collaborative, regional, close team, pleasant and open atmosphere, personal development, lean/efficient
Table III Summarized results for Items related to Vision Item
Achieved in 5 years time
organizational VUmc merged, regional, corporate AMC larger, (merged, regional) work practice VUmc more continuity, peace,
AMC better coverage, better facilities
professional VUmc excellence (development in specific areas)
AMC more focus, able to provide care, research and education Relevant external changes All: ‐ Ambiguous policy hospital ‐ Shift towards complex care (3e lijns) ‐ Concentration of care ‐ Super specialisation of surgeons ‐ Increasing participation of patients ‐ Emerging ZBCs ‐ Increasing administrative load VUmc more mamma and more gender surgery budget cuts AMC Increasingly complex and more complex reconstructive surgery Influence Most: Ourselves: Better PR; More insight; Making choices; Collaboration Some: RvB, Referring specialties, Patient organizations; HC Insurance Proud / satisfied Professional aspects Vumc developed expertise and collaboration (e.g. schisis, gender) AMC Specific expertise, expertise network, innovation, knowledge, collaboration with other specialties, complex care, continuity Task aspects Vumc variation in work, autonomy AMC variation, diversity, new challenges, combination of peripheral and academic work Culture Vumc Secure, collegiate, good atmosphere without envy, drive and ambition, coherence, fun, diversity and acceptance, freedom, open communication AMC Good atmosphere Future department All: Larger group Most: Merged group AMC/VUmc (collaborations with peripheral centers) Many: Excellency in focus area Many: Better research support and possibilities Some: More personalized medicine, innovation BHAG Basically four types: 1. “The department in the Netherlands where every patient feels to be in good hands and where everyone desires to work” 2. “Overall Amsterdam collaboration between academic, peripheral and private plastic surgeons” 3. “Being the Mayo‐ clinic of Europe (with regard to plastic surgery)” 4. An ambitious goal referring to a specific sub‐specialty
Table IV Views on strategical items Items Improvements and Urgent changes / developments VUmc Make choices Reorganize care and people Improve communication Improve quality of care and monitor Urgent problem: fragmentation Transparency – measure, PROMS! Individualized medicine – innovation More surgical time Improve education/science Install, strengthen expertise centers Merger PR AMC More focus (but 1: extend range) Increase staff Enhance support Urgent problem: Too few staff Too little support Improve financial position research Expand research Listen more to each other Prevent losing “2e lijns zorg” Merger PR Steering parameters Organisation parameters: who, what, where Production parameters: number of patients, interventions, (scientific output), revenues, costs Quality measures: outcome measures, PROMs Table V Views on Collaboration / Merger Item All: Alliance Yes, ‐necessary ‐we are complementary ‐fun ‐but how? Prevent Quarrels; Lack of clear agreements; Having 2 leaders; No unity (feeling of us versus them); Loss (of freedom, of FTE, of ...) First step No clear consensus Hurdles Who will be the boss; Egos; Lack of mutual trust; History; Culture differences; Lack of shared vision
3.1 Summation of the results 3.1.1 Mission Views on identity, the reason for being, the customer, and the values were on the whole quite homogenous for both departments. All staff members mentioned patient care, research and education as important tasks. All were conscious of the academic profile of the team, which involves higher complexity care, facilitating patient care in other departments, research and innovation, and also the training of future plastic surgeons. All perceived the patient as the ultimate customer, while other specialists and referring physicians were also mentioned as important customers. The residents were seen as customer by approximately one third of the staff members. When asked about the identity of the department, cultural aspects were emphasized by almost all. In VUmc, respecting one another, despite differences in character, personal ambitions, or view was highlighted by several staff members as a special asset of the team. In AMC, the openness and approachability, the stability, and being service‐oriented were mentioned as strong points. In addition, the good collaboration with other specialties with regard to complex reconstructions was unanimously mentioned as an important strength. A large part of the VUmc group demonstrated a high level of ambition and pioneering spirit. Team play, good communication, a good atmosphere, working with joy, and honesty were seen as important in both teams. Collaborating departments and centers, residents, students or the medical school itself, and sometimes patient organizations were mentioned as stakeholders. Remarkable was that not many staff members mention the hospital “organization” as an important stakeholder. Some mentioned that their department should work efficiently, deliver high quality care, and be profitable to be of service to the hospital. Providing plastic surgery per se was also mentioned as indispensable for the functioning of an academic center. However, it did not seem very clear to most participants what the department should mean to the organization as a whole. In VUmc some staff members explicitly mentioned that the RvB of the organization does not have a clear strategy, that they do not value their employees and that they are worried about the increasing gap between governance and the primary care process. In AMC, the majority
of staff reported to be unaware of the strategy of the RvB. Also, they felt unnoticed, due to the small size of the department. When asked how the department is different from the competition, cultural aspects were highlighted once more. Both groups mentioned the specific positive team spirit as a unique asset. Besides, the specific expertise was mentioned in each group. An overview of mission statements is given in Apendix B. 3.1.2 Vision The question “where do we want to be in 5 years’ time?” gave different types of responses. Some addressed professional targets and ambitions. Others referred to the organization form and the third type of answer addresses the work process. Professional targets included wanting to reach a top‐level position in one or more expertise areas, or, more modestly, to focus more on selected expertise areas. With regard to the organization form, examples are: “becoming a larger team” or “developing a regional collaborative team in which everyone endorses the priorities of the entire group and the goals where we want to go.” With regard to the work process “less stress, more continuity, better support, and improved communication” were stated aims. These types of answers were also reflected by the BHAGs stated by the individuals (Appendix B). Some stressed high quality care for the patient with a harmonious team of professionals. These were mostly the ones who also aimed for improvements in the work process. Others envisioned a Regional Plastic Surgery Team with excellent inter‐center collaboration. Not surprisingly, these participants focussed on the organization form. Others pictured an international expertise center with regard to a specific expertise, or more general; “being the Mayo Clinic of Europe”. What should remain unchanged and what made people proud could be subdivided into three categories: Professional aspects, Task aspects and Cultural aspects. In VUmc almost everyone stressed that the good team culture was treasured most. Besides, specific expertise or achievements were valued. In AMC, a good atmosphere was also referred to, but here professional aspects, specifically the good collaboration with other specialties, complex reconstructions and innovation were esteemed. In addition, most were content with the variety of tasks.
Several questions addressed what external changes are relevant to take into account for our future performance. A number of factors were mentioned by many of the specialists in both centers. An important trend is the super‐ (or sub‐) specialization of the plastic surgeons. “General plastic surgeons” do longer exist. This goes hand in hand with the trend of “concentration of care”, i.e. higher volumes of a certain type of treatment in one center. Another, development is the rearrangement of care: more complex care in the academic centers (or large regional hospitals) and low complex care in peripheral centers and ZBCs (Zelfstandige Behandel Centra). The exclusion of low complex care from the academic centers is seen as inevitable by most, but a few staff members oppose this trend. A few individuals mentioned increasing participation of the patient; the patient wants to have more say in his or her treatment. This fits with expressions like “individualized medicine” and “shared decision making”. Only one staff member explicitly mentioned IT developments as an important factor to take into account. Relevant changes in the hospital setting stated were the ever increasing administrative burden, the debilitating effect of the ambiguous hospital strategy (with regard to choices about portfolio and the merger). In VUmc the budget cuts were specifically mentioned, and in AMC the lack of support and growing administrative burden were reported by a majority. The hospital as an organization was invariantly perceived as a negative, as opposed to an auxiliary influence. Insecurity as a result of unpredictable healthcare policy and the increased dominance of the insurance companies were also mentioned by some. The question what our span of control is, and who or what we should influence in order to reach our goals was not easily answered by most. The majority felt that our span of control is small, and that we should focus mostly on what we do as a group. In addition, some advocated more consultation with referring specialties and patient organizations. Becoming more visible and better PR were suggested to create more leverage. Also, having more knowledge about management and performance parameters were mentioned as fundamentals to negotiate with superiors and external parties. 3.1.3 Strategy In both centers staff members agreed about the urgent problems that need immediate attention. In AMC these problems are understaffing, lack of support (especially in the
outpatient clinic) and the increasing administrative burden. In VUmc urgent problems are mostly related to the fragmentation of the staff as a result of working in different locations. Proposed short‐term changes aim to solve these problems. When asking about long‐term developments, more diverse answers were given. Most stressed the importance of (further) developing focus areas or specific expertise areas, combined with high level research. Conversely, a few individuals wanted to keep the broad spectrum of plastic surgery within the academic center, or even wanted to deversify. Achieving a mutual collaboration or merger of departments was mentioned by several staff members from both departments. A better organization of care and the collaboration within the region with peripheral centers was suggested by some individuals both in VUmc and in AMC. Besides, staff members wanted to expand research, improve education, and enhance PR. The question on what steering parameters we should use seemed to be an intricate question for many. Evidently, in both departments there is currently a total lack of information on performance measures. Three types of steering parameters were proposed: 1) Organisation parameters: who is doing what and where, 2) Production parameters: how many patients, how many and which interventions, what is the scientific output, financial parameters, and 3) Quality measures: outcome measures, PROMs. 3.1.4 Alliance The question “do you see possibilities in collaborating with your sister department?” was universally answered with yes. Some were convinced of the necessity, some were more restrained, but all answered positively. Everyone thinks that there is added value in a collaboration, however, the workability of a merged department is viewed diversely. Also, what should be the first step was varyingly answered. Both bottom‐up and top‐down approaches were suggested. While some propose to first develop collaborate visions and plans, others propose to start more informally. Who should become the leader, egos, and lack of a shared vision were seen as hurdles. Not becoming a unity, but remaining two separate teams should be prevented. We should also prevent quarrelling and cutting back on recourses. Further, we must avoid excessive meetings, not seeing each other regularly, and other organizational draw backs.
3.2 Similarities and differences The results reveal that the views of the plastic surgeons from both departments show much more similarities than differences. Actually, views on all important aspects correspond very well. However, there are some nuances of difference. Overall, the VUmc staff expresses more ambitious aims, and is more future‐oriented. There is low resistance to change. The VUmc staff does not feel very strong ties with the VUmc hospital (location). In contrast, the AMC staff does feel strong bonds with the AMC location, in the form of many good relationships with colleagues from collaborative departments. In other words, there is more history and trust in these collaborations. Urgent problems are present in both departments. In VUmc the problems have mainly to do with the dispersion of staff over various centers, while in AMC the problems are that the staff is too small and there is a lack of (dedicated) support staff. While VUmc staff is quite unanimous about the necessity to rearrange care, and collaboration with peripheral centers, the AMC staff is divided on this point. Some want to focus more, while others want to diversify. In VUmc the staff is unanimous about the open culture and mutual respect in the group. The positive atmosphere is rated very highly by all. In AMC, this is viewed similarly by most, but not all. Since there is much communality in views, there should be a good basis for collaboration. Actually it seems that the challenges to adapt to the changing internal and external environment are greater than those associated with a collaboration. Views on how to deal with these challenges are more variant amongst the AMC staff than amongst the VUmc staff. This could be due to the fact that the VUmc staff have already chosen to cross the boundaries of their academic center as a team.
4. Implications When looking at the results, it seems that collaboration between both departments is quite achievable. The department staffs have similar beliefs and there is a willingness to collaborate. However, this is not as easy as one should think at first sight. For an alliance to work and to be sustainable, one should take into account the business, network and competitive strategies. In addition, one should define the scope of the “future department”. What are the boundaries of the organization? Do we focus on the business (VUmc/AMC) or rather on a network (Amsterdam region)? The simplest model for a merged department PCH is depicted in Figure 3. Here, we combine our resources to form one merged PCH department. The boundaries are given by the boundaries of the academic centers. The starting point are our capabilities with which we create value for the patient, directly, or via other specialties. Our earnings model is entirely dependable on financial budgeting by the (corporate) organizations, who in turn may base this on the price agreements with insurance companies. This strategy can be viewed as an inside out strategy, as described by Ron Meyer.15 There are several arguments to reject this simple model. A rapidly changing “healthcare field”, the ambiguity and unsteadiness of external policies and the ambiguity of the internal hospitals’ business strategies demand a flexible and adaptive organization. Also, to be able to Figure 3 The most simple model for a merged department (based on an inside‐out view and narrow boundaries) still has uncertainties: there is a total dependency on the business executives with regard to financial income. The strategy of the separate or corporate “parent” businesses is unclear.
create a sustainable team PCH, it would be wise to not be solely dependent on the decisions made by the executives with regard to portfolio (which treatments can we perform), budget and other resources. Hence, a more versatile and comprehensive strategy is needed. For this, I will first discuss several topics related to strategy. A very useful framework for this is given by Ron Meyer, who describes the relationships between Business development, Organizational development and People development as a framework for a learning organization.16 4.1 Value proposition and Business development Every specialist that was interviewed regards the patient as the primary customer. The general opinion is that we should offer the highest quality care in our specialty. Although various levels of ambition were expressed, from “delivering the best quality care to each patient” to “becoming a world expertise center on gender surgery”, all referred to delivering high quality care. On top of this, it was generally stated that we should do research and innovate to continuously improve our treatments. Education of future medical doctors and specialists is another responsibility, but is also indispensable for continuous reflection and learning. These views fit best with a competitive strategy of “product leadership”, as described by Treacy and Wiersema17. Although operational excellence and customer intimacy are important, a “high quality product” and “research and innovation” come first. Actually, this gives a strong direction. The fundamental resources are our highly qualified experts. Our business system needs to be organized such that these experts can develop and learn continuously to stay on top of the game. However, consulting with patients and performing surgery is not all. We need to ensure that patients are referred to our team, we have to organize care in a patient friendly, personal and efficient way. We must be accessible to the patients, thus ensure that we have agreements with the majority, if not all healthcare insurers. In other words, we need to work out what the “value chain” should look like. Apart from the surgeons, many other resources are needed. For instance, OR facilities, outpatient facilities, support personnel, IT, workspace are all required. These are currently incorporated in the hospital organization. However, we know that the “value chain” – how we deliver the care to the patients – is currently far from optimal in either academic center. Can we improve
Another important aspect of the business is value capture. Actually this is one of the most difficult aspects of our business. In the current situation, each department receives a “fixed” budget which is marginally related to performance. This construction is killing for the entrepreneurial spirit. Also, the department is totally dependent on the choices made by executives, which gives much insecurity. Moreover, only a marginal budget is allocated to research and development, which jeopardizes innovation and development. Alternative options may be to participate in multiple organizations where, at least in some, the revenues are based on performance. This option could be explored. 4.1.1 Looking at the value chain for plastic surgery From the interviews some important shifts in PCH care can be distilled. We see that plastic surgeons sub‐specialize more and more. They become experts in certain subareas. Also, were previously most departments covered (almost) the entire palette of services, we see that departments increasingly focus on specific expertise areas (concentration of care). Another important trend is the shift of the less complex care to ZBCs and peripheral centers. It is important to realize what these changes mean for our strategy. Furthermore, we cannot ignore a shift in the general view on healthcare. As already mentioned in chapter 2, Porter and co‐ authors advocate a major shift in the way healthcare should be organized. In their 2013 article, Porter and Lee9 give a matured view on this strategy and organization of healthcare. Their “value agenda” is shown in Figure 4. In this stage, steps 1 and 2 are relevant to us. They advocate to organize care, not by specialty, but by condition. In the Netherlands, this is often referred to as “tilting” of the organization. In this metaphor, the organization is represented by a matrix in which columns are the specialties, and rows are the multidisciplinary processes. Tilting this matrix would imply a guiding role for the Figure 4. From Porter and Lee9
processes in the organization. This gives rise to an interesting question: when aligning our business system and organization to our value proposition, what perspective do we take? In order to think about these issues it is useful to order the PCH services in certain ways. First we can look at subspecialties and expertise. For the departments of PCH in this study I have categorized the subspecialties pragmatically as presented in Table VI. Table VI An overview of the subspecialties. The categorization is pragmatic, based on the expertise of plastic surgeons in the two teams. Subspecialty Hand/wrist Reconstructive surgery (breast, complex) Genital surgery Children (schisis) Wound and scar Cosmetics Another way to look at PCH services is the complexity of these services. A service can be complex along different axes (Figure 5). It is not hard to understand that to deliver the service in an optimal way depends on the amount of complexity along these axes. A third way to look at the PCH services is to look at the process. Based on the ordering per subspecialty and complexity, one can roughly indicate what path a patient generally follows. Some simplified examples are given below: Hand/wrist: referring physician – PCH consult – PCH treatment – hand therapist Transgender: psychologist – endocrinologist – PCH consult – PCH treatment Complex reconstruction: other specialty – MD consult – PCH/multidisciplinary treatment For each of these groups, one can estimate the patient volume and how far treatments can be protocolized or whether this care is “tailor made”. The best care delivery model for each of these types of patient groups may be different. 4.2 Organizational development and Boundaries of the organization The most challenging part in this case is the organizational system. We have analysed PCH Figure 5 Complexity of care along different axes
embedded in two large academic hospitals, and one of the departments has multiple collaborative engagements with other healthcare organizations. The way in which we develop our organization is very much limited by this setting. A fundamental choice therefore is what we see as the boundaries of our organization. Since VUmc staff are already engaging in collaborations outside the VUmc, their scope is already broader than only the academic setting. In the AMC, this varies between staff members. Some explicitly state that they also should include the periphery in “the organization”, some are focussed specifically on the academic center. It is good to make explicit that this choice with regard to the boundaries is dependent on some underlying surmises. If your primary aim is to optimize the business of PCH care deliverance with the highest quality, the “parenting organization” comes second. The association with this organization is only advantageous if it adds value to our business. According to Goold et al. (1998)18 – although formulated from the perspective of the parent – it is only useful to incorporate a unit if: The parent sees an opportunity for a business to improve performance and a role for the parent in helping to grasp the opportunity; The parent has the skills, resources and other characteristics needed to fulfil the required role; The parent has sufficient understanding of the business and sufficient discipline to avoid other value destroying interventions. Associations with other healthcare centers should be studied according to this same perspective: what value do they add to our business? On the other hand, you can take the perspective of the organization, i.e. the academic hospital. In that case, you want to assess what the PCH department contributes to the organization as a whole. It should be noted, however, that only a few of the staff members demonstrated any inclination towards this perspective. Another difficulty of taking this route is that the vision and strategy of the “parent” organization is unclear, so what should we be striving for?
4.3 People development The third element in creating an adaptive and learning organization (a prerequisite for a product leadership) are the people in the organization. Especially in healthcare, humans are our vital resources. Their knowledge and skills form our most important intangible assets. In our PCH department, the surgeons from “the core team”, but the supporting people are equally important in the value chain. From the interviews, it is apparent that the specialists are all very motivated and dedicated people, who all value the good atmosphere in the team and who all value good collaboration within the team as well as with colleagues outside the team. Also, there is quite a good alignment of mission and vision within the group. The importance of personal development is generally recognized. Yet, this involvement of people in the business is not true for the entire value chain. The “not‐PCH‐dedicated” service centers (such as the OR, and the outpatient clinic in AMC) function suboptimally. The pool of support staff in these service centers is large, which makes “bonding” and development of specific skills difficult. These individuals do not feel “on the team”, and unfortunately, a costumer centred culture lacks in these service centers. Nevertheless, it is important to find a strategy to improve the alignment of support staff ambitions or drivers and the PCH organization.
5. Conclusions and recommendations 5.1 Compatibility The interviews with all 17 staff members from both departments revealed corresponding views on a majority of issues that were addressed. All agree on the core business of delivering high quality PCH care, performing associated research which contributes to innovation, and providing education. All highly esteem the team atmosphere and values, such as respect, openness, honesty, collegiality and professionalism. All cherish good collaboration and communication. And although each individual has his/her own specific ambitions, these seem to fit into the mutual goals of the teams. When talking about current problems, these were identified similarly within each team. And although these problems were different for both teams, underlying views on “what would be optimal care delivery” were similar again. Briefly, this includes: being able to spend time with the patient (rather than administration), enable a good follow‐up (ensure continuity), good communication with colleagues and others involved in the care, having regular face‐to‐face contact with these colleagues, being able to concentrate on “core tasks”, eliminating overburdening and stress, and having one or more colleagues covering the same subspecialty within the team. While views on mission are quite homogeneous (with different accents for each individual), views on the vision are more divergent. This may be expected, as you can focus on different spots on the horizon even if you start from the same position. The general external and internal changes relevant to PCH were recognized in similar ways by most staff members, while some mentioned some specific development in their subspecialty as well. How to deal with these changes varied. While some would like to prevent change, others embrace it. All staff members looked positive towards collaboration or alliance. Some viewed this as inevitable and wanted to go ahead immediately, others were more cautious and suggested to take one step at a time. The perceived hurdles for collaboration were first the question of leadership. Who becomes the new head and will personalities get in the way? Other hurdles or fears were a lack of integration of teams and a lack of alignment of strategy. Also there was fear of “loss”: will one plus one add up to two?
All in all, we may conclude that both teams are quite compatible. Both teams are more similar than they think they are. This does not mean that alliance will work without effort; 1. The leadership issue needs to be resolved; 2. Clear choices have to be made about vision and strategy. 5.2 Recommendations 5.2.1 Theoretical intermezzo When leading an organization, one needs to decide what should be done and how. The “what and how” refers to the organization’s strategy. Much is said about strategy development. Literature about strategy making varies from theoretical approaches (what do we think that strategy making is), descriptive literature (describing examples or studying strategy making more systematically), to opinion literature (stating how a leader or organization should make strategy according to the author). With regard to the theoretical approach, the 1990 paper of Minzberg is renowned19. In this chapter, Minzberg describes 10 “schools of thought” with regard to strategy making. These theories of strategy making vary in the extent to which the strategy is planned versus emerging, the degree to which the strategy is made explicit, versus implicit, and whether the strategy is imposed, rather than shared, and to what extent environmental and political influences are supposed to matter (amongst other differences). Minzberg concludes that strategy making remains rather ungraspable, but that it is much more comprehensive than any of the separate theories described. His overview is still very helpful to become aware of these many dimensions of strategy making. Another strategy paradox, among others described by Meyer20, is the paradox between change through evolution or revolution. Organizational change can occur gradually and over a long time or abruptly and radically. According to Meyer, revolutionary change is “generally needed when the organizational rigidity is so deeply rooted that smaller pushes do not bring the firm into movement” or when only a short time span is available for a large change. On the other hand, “the evolutionary approach to strategic change is particularly important where the strategic renewal hinges on widespread organizational learning.”
