TIME FOR A CHANGE AT THE CHANGE FOUNDATION

Alexander Smith wrote this case under the supervision of Professor Anne Snowdon solely to provide material for class discussion. The authors do not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other identifying information to protect confidentiality.

It was January 2007, and Cathy Fooks had just accepted her new position as chief executive officer (CEO) of The Change Foundation, an independent charitable foundation founded in 1996 by the Ontario Hospital Association (OHA) with a mandate to promote, support and improve health and the delivery of health care in Ontario. After 10 years, the board had undertaken a renewal process to evaluate the strategic directions of the foundation and measure the value-add of progress to date. After reviewing the new board-approved strategic plan, Fooks had some concerns about how The Change Foundation should refocus its activities and transform itself going forward. Before she could start to rebuild the foundation, she had to decide what its future direction shouldbe.

ORIGINS OF THE CHANGE FOUNDATION: THE ONTARIO HOSPITAL ASSOCIATION

The OHA was a member association representing over 150 Ontario public hospitals. It had the broad vision of "achiev[ing] a high-performing health system."¹ The OHA achieved this by providing its member hospitals with high-quality products and services, leading innovation and performance improvement and influencing Ontario health system policy.

In 1996, the OHA received a one-time payout of approximately $50 million through the divestiture of Blue Cross Insurance. This opportunity provided a number of investment options; however, the OHAchose to set up an endowment fund and establish The Change Foundation to lead transformation in the Ontario health system. Sheila Jarvis, chair of the OHAboard in 2005 and of The Change Foundation board from 2011 to 2013, explained that this money was designed to "enable the health care system in Ontario, through the lens of hospitals, to explore new and innovative ways of doing business."²The funds enabled the OHA to develop an opportunity to achieve a sustainable approach to health system innovation from which all organizations in the health system could benefit. The vision was to promote a high- achieving Ontario health care system for thefuture.

In 2006, the OHA itself developed a new strategic plan to better achieve a high-performing health system in the future. It consisted of five key strategic directions:

• Create strong and lasting partnerships that advance health systemintegration;
• Improve knowledge transfer of leading practices to strengthen health systemperformance;
• Strengthen governance throughout the health caresector;
• Improve executive and management leadership capacity within the health sector through a new leadership institute;and
• Provide thought leadership on health system issues based on facts, evidence and/or hospital expertise.³

HISTORY OF THE CHANGE FOUNDATION

The Change Foundation began primarily as a granting agency offering small amounts of funding to a wide range of projects; its mandate was "promoting, supporting and improving health and the delivery of health care" (see Exhibits 1 and 2). Gail Donner, chair of The Change Foundation board from 2007 to 2009,explained:

The organization would tell people, "get a good idea underway" with the idea that over time they would then be eligible for significant funding. That's why we have the name, "Change Foundation" it was a jumpstart for projects with less experience or with a good idea but not enough resources to work it through.

The Change Foundation was a separate entity from the OHA. It had a separate board and CEO, who reported to the OHA on their progress every year to make sure that they were achieving the mandate that the OHA had given them. However, despite the separation, the OHA remained in a position of control over The Change Foundation and had the ability to remove the board and change its bylaws if it was unhappy with the progress that was being achieved. The Change Foundation worked to achieve its mandate through two key core functions: knowledge creation and knowledge transfer.

Knowledge Creation

Knowledge creation was achieved at The Change Foundation through two key programs: the Change Initiatives Grants Program and the Research Program.

The Change Initiatives Grants Program was a joint program between The Change Foundation and the Ontario Ministry of Health and Long-Term Care (MOHLTC). It was designed to broadly support innovations that improved health care in Ontario. Each year, The Change Foundation established priorities for health system innovation that were then released to the research community, and grant applications were reviewed for strengths in achieving these priority targets. In 2005, for example, this goal was to "support Ontario Health System Transformation by enhancing organizational integration through LHINs [Local Health Integration Networks] and supporting disease management."⁴Tenresearch

projects received funding totaling $822,000 in 2005 (see Exhibit 3). This funding was supported through additional matched funding from the MOHLTC. Between 1997 and 2005, 75 projects were funded at a total of $5.9 million.

The Research Program consisted of a series of research project publications by The Change Foundation. These projects varied greatly, from establishing the Provincial Disease Management Network to collecting best practices in hospital and community integration in mental health. Through partnering with external individuals and organizations, The Change Foundation completed research projects and produced policy papers consistent with its mandate. Since 2004, the Research Program had focused on "promoting system transformation throughintegration."⁵

Knowledge Transfer

In addition to producing research both in-house and through grants, The Change Foundation promoted the transfer of health research into clinical practice. Specifically, it focused on the roles of social marketing, electronic media and complexity theory on research knowledge transfer. The Knowledge Transfer Program partnered with the OHA through participation in and co-sponsorship of OHA events and conferences. The majority of projects within this stream focused on education and leadership development. The Change Foundation offered international study tours for health executives to provide senior health leaders the opportunity to learn new health policy and practices from the United Kingdom, Australia, Sweden and Norway.⁶

In 2003, the mandate of the Knowledge Transfer Program was expanded to focus on developing leadership capacity among health executives and emerging health leaders. The Change Foundation partnered with the University of Toronto's Rotman School of Management and the King's Fund to develop a four-week training program for future health leaders focused on change management and integrativethinking.

In 2005, the mandate of the Knowledge Transfer Program was further expanded with the OHAfrica Project. Initiated by the OHA, OHAfrica challenged Ontario hospitals and other health organizations to help manage the AIDS pandemic in Africa. This involved sending teams of health care practitioners to Lesotho to introduce antiretroviral drugs. The Change Foundation committed to contributions totaling

$1.5 million over three years to start this work and ultimately establish the program's independence. By 2006, OHAfrica had placed over 1,200 people on life-saving antiretroviral drugs in Lesotho.⁷

OHA REVIEW OF THE CHANGE FOUNDATION

In 2004, nearing the tenth anniversary of The Change Foundation and with a new strategy for the OHA in development, a new strategic plan needed to reflect on achievements to date to determine the foundation's future role. The OHA had begun to question the foundation's effectiveness: was it making the impact on health system transformation that had been anticipated? The association felt that the research projects that were being completed were too small in scale to achieve health system change. It began to question whether or not funding small grants was the right approach to achieve transformation and change, as the recipients did not always have the scientific research competencies to produce high-quality research.One

of the core values of the OHA was to be evidence-based, so the quality of the evidence produced was of the utmost importance.

Ultimately, the OHA was also concerned with impact. The OHA and The Change Foundation had already had two joint board and executive committee meetings to discuss these issues. Several board members had been replaced in an attempt to lead organizational change, but without starting anew and removing the existing legacy structures and processes, change waslimited.

The OHA decided that more significant change had to occur at The Change Foundation, and as part of this new strategy, it replaced members of the foundation's board with OHA members in an interim capacity. Jarvisexplained:

This was a very typical governance strategy and the board of the OHA, we appointed some of our own board members to be the new board of The Change Foundation, recognizing it was really an interim measure, while we thought about a strategic plan for The Change Foundation and then went out to recruit a new CEO with a new and fresh mandate.⁸

THE CHANGE FOUNDATION DRAFT STRATEGIC PLAN 2006

With pressure coming from the OHA, The Change Foundation's interim CEO and board underwent a strategic planning process consisting of two main phases: a SWOT (strengths, weaknesses, opportunities, tensions) analysis and environmental scan to understand the climate at the time and a Strategic Directions Think Tank to select the key strategic priorities.

Draft Strategic Plan: Phase 1 SWOT Analysis

The strategic planning process consisted of over 30 interviews with key stakeholders and several focus groups to identify the organization's strengths, weaknesses, opportunities and tensions.

One of the key components of the strategic renewal process was to examine the state of health care research organization in Ontario in order to better understand The Change Foundation's contributions. A benchmarking review of foundations in Ontario revealed that health care research was funded by four main types of organizations: full-service foundations, granting and knowledge transfer organizations, research institutes and think tank/policy forums (see Exhibit 4). The provincial health research landscape was growing, with a broad range of organizations focused on health research that ranged in size from small players to large organizations with endowment funds in excess of $200 million. No single model of foundation existed, as each organization used different core processes and mechanisms to achieve its mandate.

Robin Osborn, vice-president and director of the International Program in Health Policy and Innovation at the Commonwealth Fund, outlined seven key components of a "value-added foundation":

• A clearmission;
• Determination tofocus;
• Well-definedstrategies;
• Rigorous grantmaking;

• Solid intellectual grounding in chosenfields;
• Communication to influential audiences;and
• Concern for accountability andperformance.⁹

The findings of the SWOT analysis can be found in Exhibit 5.

Draft Strategic Plan: Phase 2 Strategic Directions Think Tank

In May 2006, after the initial SWOT analysis was complete, The Change Foundation held a Strategic Directions Think Tank, which included 40 senior health leaders, policy and decision makers, grant makers, educators and health services researchers, to define the strategic priorities of the organization going forward.

The outcomes of the strategic planning process solidified The Change Foundation as a hybrid between a granting and knowledge transfer organization and a think tank/policy forum organization. Guided by a new mission, vision and value statement (see Exhibit 6), The Change Foundation sought to achieve a more focused approach to granting, a renewed focus on developing a role as a think tank organization and a new focus on capacity building through five key strategicpriorities.

Priority 1: Support the successful implementation of integrated health systems in Ontario

In 2006, Ontario established a new regionalized health care system with the implementation of LHINs. The 14 regional health authorities managed all planning, integration and funding for all Ontario hospitals, long-term care homes, community care access centres, mental health agencies and community support agencies. This was to be a major change in the Ontario health care system, and there was opportunity for research organizations to study its structural governance and support the transition.

The Change Foundation had experience in health system integration, with several studies exploring international models of regionalization that could be transferred to the Ontario situation. Any potential research would be required to meet the following priority research themes: relevance, future orientation, multidisciplinary, potential for leveraging partnerships and potential to influence policy.¹⁰

Key goals and implementation strategies for priority 1 are outlined in Exhibit 7.

Priority 2: Serve as a catalyst for multi-sectoral and informed public policy debate

The Change Foundation would operate as a "research broker" connecting people, evidence and action together. To achieve this strategic priority, The Change Foundation would begin by proactively seeking the pressing issues with which policy makers would be dealing within the next 12 to 18 months. The foundation would then connect research teams, policy makers and health leaders to conduct and support research collectively. Finally, The Change Foundation would leverage the integrated research approach through the dissemination of research results to the influential policy makers leading action.

Key goals and implementation strategies for priority 2 are outlined in Exhibit 8.

Priority 3: Foster leadership capacity building

The Change Foundation recognized that there had been insufficient support and resources directed at the next generation of health leaders. Many other organizations also recognized this, and the health leadership training industry was becoming saturated including by the OHA, which was looking to expand its leadership development programming. Therefore, The Change Foundation would discontinue leadership training and become a catalyst to support it. The foundation had experience working with international partners who provided innovative models of education such as visiting scholar, fellowship and cross- training programs that were not present in Canada. There was a unique opportunity to adapt these programs to the Ontario context and evaluate their effectiveness.

Key goals and implementation strategies for priority 3 are outlined in Exhibit 9.

Priority 4: Promote organizational excellence

The changes in the strategic direction towards a think tank model required a new set of employee competencies, either in The Change Foundation's existing employees or new ones. The required competencies would be assessed and the optimal approach to acquiring these skills would be evaluated. During the strategic planning process, The Change Foundation was being led by an interim CEO; therefore, a new permanent CEO would need to be hired to lead the new organization.

The Change Foundation did not receive adequate recognition for many of the successful and well-known research projects that it funded. The Ottawa Model for Smoking Cessation, for example, was a celebrated model for health promotion in over 140 sites across Canada. Very few knew, however, that The Change Foundation was linked to the study. There was no model for monitoring outcomes and communicating them to the necessary stakeholders. The Change Foundation would focus on building its provincial and national reputation by profiling its successes to secure itself as a reputable research hub.

Key goals and implementation strategies for priority 4 are outlined in Exhibit 10.

Priority 5: Implement a sustainable future plan for the OHAfrica Project

The Change Foundation would continue its commitment to the OHAfrica Project and support its sustainability after three years by the creation of a new charitable organization focused on the existing work in Lesotho.

Key goals and implementation strategies for priority 5 are outlined in Exhibit 11.

NEW LEADERSHIP AT THE CHANGE FOUNDATION

The Change Foundation board and the OHA approved the strategic plan in September 2006. Donner explained:

The board was a transitional board, some from the previous and some newly recruited board members. I think the newly recruited members were quite determined to see it change, but getting

some external review and also holding this large think tank really helped people understand that the timing was right for us to morph into something more valuable to the system.

The first step of the strategy was hiring a new full-time CEO. The board sought Cathy Fooks, executive director of the Health Council of Canada where she had responsibility for reporting about health care renewal to Canadians.

Fooks joined The Change Foundation in January 2007 after the draft strategic plan had been developed. She had previous experience with the foundation as a member of a project committee that examined the quality of the work being funded and how to implement it to a system level. She very quickly noticed several problems with the committee and the way it was run most notably that it consisted of members who were leading the very projects the foundation was funding and decided to leave it. In 2006, when she was approached by a headhunter with the proposition to lead The Change Foundation in a new direction, with full board support, she became very interested: "[It was] an opportunity to really start afresh and that is what I love to do." She elaborated:

The attraction for me was the tabula rasa this notion that I could go into an organization that was financially stable . . . which is really unusual for a foundation. I had a complete green light from the hiring committee. . . I had the authority and the ability to rethink from the beginning. In some ways, it was like coming into a new organization without having to do the infrastructure and financial build.

However, Fooks also knew that there would be several challenges if she were to accept the CEO position. First, she knew there would be a lot of ambiguity in her first year as the organization went in a new direction. Major changes would be happening: staff would have to be moved out, strategic priorities would be changing and operations and projects would have to be closed. Second, the position would require her to lead transformational change, which required a unique skill set. Third, there was some uncertainty about the relationship that The Change Foundation had with the OHA. Fooks knew that there was a chance, however small, that the foundation could spend an entire year developing a new strategic plan that the OHA would notapprove.

During her interview with several of The Change Foundation's board members, Fooks was presented with the draft strategic plan for the organization and was asked what suggestions or changes she had to make. She immediately knew that significant changes had to be made to the draft plan and considered her options.

REBUILDING THE STRATEGIC PLAN: A NEW DIRECTION

Fooks recalled,

My impression was that the organization had small effects at a very local level. They had done a lot of smaller grants hundreds of them without a lot of rigorous evaluation . . . the problem was, when you roll it up to a system level, there wasn't an impact. So we're called The ChangeFoundation, but what did we change?

The board and staff at The Change Foundation realized that they were not reaching the system-level impact with which they had been tasked, that is, to be a major contributor to the strategic planning process.However,Fooksnotedthatthereseemedtobeacommonviewwithintheorganizationthatthe

way to achieve system-level impact was to promote and advertise the research projects more; she thought it was much more involved than that.

When The Change Foundation was founded in 1996, it was one of the major health research funding agencies in Ontario. Fast forward to 2006, and the market was much more crowded, with much larger agencies such as the Canadian Institutes of Health Research (CIHR) and the Canadian Health Services Research Foundation (CHSRF), which had endowment funds upwards of $200 million in comparison to The Change Foundation's $50 million. In addition to the financial barriers, Fooks thought that, in comparison to some of the larger organizations, The Change Foundation did not have the in-house talent to be able to manage all of its projects. The foundation had just seven full-time staff in comparison to hundreds at CIHR. She wondered if the new strategic plan would be able to meet the foundation's mandate of "promoting, supporting and improving health and the delivery of healthcare."

OPTIONS

Fooks knew that there were five main strategic directions that the foundation could take going forward. She carefully weighed which direction or combination of directions the organization should take:

1. Merger with theOHA

The OHA could bring The Change Foundation in-house and manage its mandate internally. The Change Foundation would act as the research/policy department of the OHA. The foundation's CEO would also hold a vice president position in the OHA. Fooks made it very clear in her interview that she was not interested in this option.

1. Close The ChangeFoundation

The Change Foundation had a large endowment that would remain in effect as long as necessary. It was not taking in any active donations, so there were no donors who needed to be satisfied. The foundation could be closed for a period of time until a new opportunity presented itself.

1. Merger with anotherfoundation

Several similar organizations such as the Wellesley Institute or the Atkinson Foundation were similar in size to The Change Foundation and had similar mandates. By entering into conversations with these organizations, a larger foundation could be created to lead even greater system-level change in Ontario health care.

1. Focus The Change Foundation as a grantingorganization

It was clear the foundation was trying to do too much and was very unfocused. However, with some refinement, the grants program could be made more efficient, more high-profile and more focused. This option would also require a detailed funding plan. Decisions would be required outlining what types of projects would be funded, what research areas should be prioritized and what were the existing research gaps. Since the foundation's resources were limited, a decision was also required to determine whether it

should choose a variety of smaller projects or one key area that no one was talking about now, but would be in two to three years, to address a key gap.

1. Change the foundationmodel

The Change Foundation could cease its granting practices and transition to another health research organization type. Potential models could include leadership capacity building (supporting/educating health leaders), think tank (policy influencing), brokering best practices (evaluating clinical or managerial practices) or many others. However, despite strong management and research departments, The Change Foundation lacked many of the skill sets necessary for alternate models (e.g., policy experts, stakeholder engagement experts, communications team, etc.).

Regardless of the decision made, Fooks knew that each option carried with it a set of consequences that would have to be considered and overcome. For example, if The Change Foundation chose to focus on one target research area, its risk would increase as there was no fallback if the research did not go as planned. Therefore, integrated quality assurance would be an essential priority. If The Change Foundation chose a new health research organization type, staffing levels would have to change to reflect the new needs of the new model. Seemingly simple decisions could lead to significant organizationalchanges.

SUMMARY

With multiple target audiences and strategic priorities, inconsistent project involvement and a vague mandate, mission, vision and values, Fooks had reservations about this plan. As she sat down in her new CEO office, she began to write her proposal to the board.

Question

External Environment & Problem Analysis Using the PESTEL framework, analyze the external environment that is impacting the organization. What are the key problems that are inciting the need for change?

• What are the impacts and what are the risks if the company does not change? Vision for Change & Gap Analysis What is your Vision for Change? Use Toolkit Exercise 4.3 to guide you. How will this inspire change through communication and leadership behaviour? Conduct a Gap Analysis between the current state and the desired state