Reflect on an important professional change that you have experienced. Compare your change story to one of the stories from the beginning of Chapter 1 of the text. Answer the following questions and support your thoughts with at least two scholarly sources. In your paper you must: Describe your change story and the one selected from Chapter 1 of the text. Discuss the common issues and lessons present in both stories. Identify and discuss the embedded lesson found in the four change stories of Chapter 1. Describe how you might use the lessons as a solutions template during future change strategies.

The Story of Beth Israel Deaconess Medical Center

Issues to Consider as You Read This Story

1. Identify five factors that explain the success of this corporate turnaround.

2. How would you describe Paul Levy’s role and contributions to this turnaround?

3. What insights does this story have to offer concerning the role of the change leader?

4. What lessons about managing organizational change can we take from this experience and apply to other organizations, in healthcare and in other sectors? Or, are the lessons unique to Beth Israel Deaconess Medical Center?

The Setting

This is the story of a corporate turnaround, rescuing the organization from financial disaster and restoring its reputation, competitiveness, and profitability. Based in Boston, Massachusetts, the Beth Israel Deaconess Medical Center (BID) was created in 1996 by the merger of two hospitals. The business case for the merger was that the larger organization (over 600 beds) would be better able to compete with, for example, the Massachusetts General Hospital and the Brigham Women’s Hospital. The two merged hospitals had different cultures. Beth Israel had a casual management style that encouraged professional autonomy and creativity. Deaconess Hospital was known for its rules-based, top-down management. Staff were loyal to their own organization. After the merger, the Beth Israel culture dominated, and many Deaconess staff, especially nurses, left to join the competition.

The Problems

By 2002, BID was losing $100 million a year and faced “financial meltdown.” There were problems with the quality and safety of care, with low staff morale, and with poor relationships between clinical staff and management. The media attention was damaging BID’s reputation.

The Solutions

External management consultants recommended drastic measures to turn around the hospital’s finances, and Paul Levy was appointed chief executive officer of BID in 2002. Levy had no healthcare background and little knowledge of hospitals. He felt that gave him an advantage, as he was a “straight talker” and could act as an “honest broker.” But staff were skeptical at first. Levy’s turnaround strategy was based on two themes: transparency and commitment to quality. His first action was to share with all staff the full scale of the financial difficulties, to create “a burning platform,” from which escape would only be possible by making radical changes. His second approach was to signal absolute commitment to the continuous improvement of quality, in order to build trust and to establish a sense of common purpose. Levy described his management style: Perhaps I had an overly developed sense of confidence, but my management approach is that people want to do well and want to do good and I create an appropriate environment. I trust people. When people make mistakes it isn’t incompetence, it’s insufficient training or the wrong environment. What I’ve learned is that my management style can work.

Phase 1: With the hospital “bleeding money,” urgent action was necessary. Levy accepted some of the management consultants’ recommendations, and several hundred jobs were lost, in an attempt to restore financial balance. He refused to reduce nursing levels, but the financial crisis was resolved.

Phase 2: Medical staff were tired of poor relationships with management. In 2003, Levy hired Michael Epstein, a doctor, as chief operating officer. Epstein met with each clinical department to win their support for the hospital’s nonclinical objectives and to break down silo working. Kathleen Murray, who had joined BID in 2002, was director of performance assessment and regulatory compliance. The hospital had no annual operating plans, and she set out to correct this, starting with two departments that had volunteered to take part in phase 1, orthopaedics and pancreatic surgery. Other departments soon joined in. Operating plans had four goals, addressing quality and safety, patient satisfaction, finance, and staff and referrer satisfaction. One aim was to make staff proud of the outcomes and create a sense of achievement. Although the performance of doctors would now be closely monitored, the introduction of operating plans was seen as a major turning point.

Phase 3: To help address the view that medical errors were inevitable, Levy appointed Mark Zeidel as chief of medicine. Zeidel introduced an initiative that cut “central line infection” rates, reducing costs as well as harm to patients and providing the motivation for more improvements. The board of directors were not at first convinced that performance data should be published, but Levy was persuasive, and he put the information on his public blog, which he started in 2006, and which became popular with staff, the public, and the media, with over 10,000 visitors a day. Levy explained: The transparency website is the engine of our work. People like to see how they compare with others, they like to see improvements. Transparency is also important for clinical leaders and our external audience of patients and insurers. We receive encouraging feedback from patients. We’ve also managed to avoid a major controversy with the media despite our openness. Transparency’s major societal and strategic imperative is to provide creative tension within hospitals so that they hold themselves accountable. This accountability is what will drive doctors, nurses and administrators to seek constant improvements in the quality and safety of patient care. Other performance data were published, for the hospital and for individual departments. This included measures to assess whether care was evidence-based, effective, safe, patient-centered, timely, efficient, and equitable. Progress in meeting priorities for quality and safety could be tracked on the hospital’s website, and the data were used by staff to drive quality improvements. The board also set tough goals to eliminate preventable harm and increase patient satisfaction. Every year, staff were invited to summarize their improvement work in poster sessions, featuring the work of 95 process improvement teams from across the hospital. Levy hired staff with expertise in lean methods. Previously an option, training in quality and safety became mandatory for trainee doctors, who had to take part in improvement projects. The culture was collaborative, and nurses had the respect of doctors. Patients often chose BID for the quality of nursing care. The departmental quality improvement directors met twice a month to share experiences. Department meetings routinely discussed adverse events. A patient care committee fulfilled a statutory requirement for board oversight of quality and safety. The office of decision support collected data on complication rates, infection rates, department-specific quality measures, and financial goals. A senior nurse said: “We felt a sense of ownership with issues of quality. We have dashboards up in the units to see how we are doing. Staff know what the annual operating goals are, as they are actively involved in setting them and integrating them into their work.”

The Outcomes

By 2010, BID was one of the leading academic health centers in the United States, with 6,000 employees and state-of-the-art clinical care, research, and teaching. Competing effectively with other major healthcare organizations, BID was generating annual revenues of over $1.2 billion.

Postscript

Paul Levy resigned in January 2011. He explained his decision in a letter to the board of directors, making this available to staff and the public on his blog. The letter included the following remarks: I have been coming to a conclusion over the last several months, perhaps prompted by reaching my 60th birthday, which is often a time for checking in and deciding on the next stage of life. I realized that my own place here at BID had run its course. While I remain strongly committed to the fight for patient quality and safety, worker-led process improvement, and transparency, our organization needs a fresh perspective to reach new heights in these arenas. Likewise, for me personally, while it has been nine great years working with outstanding people, that is longer than I have spent in any one job, and I need some new challenges.