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Success Factors for Strategic Change Initiatives: A Qualitative Study of Healthcare Administrators' Perspectives/PRACTITIONER APPLICATION [Journal of Healthcare Management]
(Journal of Healthcare Management Via Acquire Media NewsEdge) EXECUTIVE SUMMARY Success factors related to the implementation of change initiatives are well documented and discussed in the management literature, but they are seldom studied in healthcare organizations engaged in multiple strategic change initiatives. The purpose of this study was to identify key success factors related to implementation of change initiatives based on rich qualitative data gathered from health leader interviews at two large health systems implementing multiple change initiatives.
In-depth personal interviews with 61 healthcare leaders in the two large systems were conducted and inductive qualitative analysis was employed to identify success factors associated with 13 change initiatives. Results from this analysis were compared to success factors identified in the literature, and generalizations were drawn that add significantly to the management literature, especially to that in the healthcare sector.
Ten specific success factors were identified for the implementation of change initiatives. The top three success factors were (1) culture and values, (2) business processes, and (3) people and engagement. Two of the identified success factors are unique to the healthcare sector and not found in the literature on change models: service quality and client satisfaction (ranked fourth of 10) and access to information (ranked ninth).
Results demonstrate the importance of human resource functions, alignment of culture and values with change, and business processes that facilitate effective communication and access to information to achieve many change initiatives. The responses also suggest opportunities for leaders of healthcare organizations to more formally recognize the degree to which various change initiatives are dependent on one another.
For more information about the concepts in this article, contact Dr. Kash at [email protected].
INTRODUCTION Strategic change capabilities have become a primary focus as hospitals and healthcare systems attempt to perpetually improve and position themselves in a competitive market characterized by continuous regulatory changes and opportunities for reorganization and growth. Yet few empirical studies focusing on success factors for effective organizational change have been conducted in hospitals or healthcare settings (Rosacker, Zuckweiler, & Buelow, 2010).
The present study draws on management literature and examples of the successful implementation of strategic change initiatives in healthcare to further improve our understanding of how to plan for and implement such an initiative. The purpose of this study was to explore and identify specific change initiative success factors as depicted by healthcare leaders' assessments of change efforts in their health systems. Success factors available in the management literature are identified and contrasted to responses gathered from more than 60 administrators at two large healthcare systems engaged in multiple change initiatives.
Prior research attempted to evaluate how strategic change initiatives are implemented (Edmondson, Bohmer, & Pisano, 2001), how leaders promote organizational successes (Bass & Riggio, 2006), and how culture affects organizational performance (Pfeffer & Veiga, 1999). Many of these strategies have even been categorized and summarized according to the organizational change theories applied (Van de Ven & Poole, 1995). However, variation frequently occurs within and across systems in innovative program success (Armutlu, Foley, Surette, Belzile, & McCusker, 2008; Hosier & Nadle, 2000; Manzo et al., 2005; Silow-Carroll, Alteras, & Meyer, 2007), and it may be that variations in success are related to an organization's ability to acquire and use new knowledge to ensure successful initiatives (Kash, Spaulding, Gamm, & Johnson, 2013).
Healthcare strategic change initiatives research primarily focuses on outcomes that measure only one dimension of success at one level of the organization (Vest & Gamm, 2009). Generally, evaluations of change efforts have been found to fall short of increasingly high standards within health services research (Begun, Zimmerman, & Dooley, 2003). The healthcare management literature may benefit from a more industryspecific examination of success factors related to strategic change initiatives that will assist healthcare organizations along their transformation journeys.
CONCEPTUAL FRAMEWORK To define success factors, we viewed hospitals as open systems. Open systems are defined as those facing uncertainty in both their internal and external environment (Meyer & O'Brien-Pallas, 2010), making complex organizational change literature more pertinent to today's healthcare organization (the hospital system) than is the traditional change management literature of the pre1980s. Therefore, we restricted models of successful change initiatives to those described in the emergent change literature of the post-1980s. The emergent approach to change assumes that change is not linear or sequentially planned and implemented over time but rather is an open-ended process requiring adaptation and some planned changes and initiatives (Burnes, 1996, 2004; Dawson, 1994). In a comprehensive review of emergent change literature, Rune (2005) summarizes and compares three models of successful emergent change models, which we use as the analytical framework for this article. The three models include Kanter, Stein, and lick's (1992) Ten Commandments for Executing Change; Kotter's (1996) Eight-Stage Process for Successful Organizational Transformation; and Luecke's (2003) Seven Steps. Additionally, we view these models through the lens of Young's (2005) Seven Lessons From the VHA model of empirical research on organizational transformation in the Veterans Health Administration (VHA) system in the early 1990s, which is one of the few applicable studies of lessons learned from the implementation of multiple change initiatives in the healthcare sector. Figure 1 summarizes and crossreferences the success factors for change across these four models.
As we compare the models, we can see certain common concepts related to the need for change. These concepts include strong leadership, effective communication and people involvement, and system-wide unity. The first three models (Kanter et al" Kotter, and Luecke) stress the importance of a shared vision and strategies that direct us to that shared vision. Two models (Kanter et al. and Young) stress the need for a well-crafted implementation plan, while the other two models (Kotter and Luecke) stress flexibility, empowered action, and the ability to adjust strategy in implementing change. These four models of successful change, including success factors and lessons learned from the implementation of organizationwide change initiatives, became the backdrop for our qualitative research results, which address success factors for the implementation of strategic change initiatives in healthcare.
METHODS This study presents an assessment of various strategic change initiatives at two large healthcare organizations: a stand-alone children's health system and a metropolitan, regional, multihospital system. We conducted 61 in-person, semistructured interviews with healthcare leaders at these settings. Inductive qualitative content analysis was employed to identify themes related to success factors for strategic change initiatives as described by interviewees. Study participants' responses also generated answers to questions relating to the number and nature of strategic change initiatives.
Data Collection and Participants The interview process was a focused, open-ended discussion designed to prompt the participants to share information about the organization's initiatives while focusing on initiative success factors (Blumer, 1969; Bogdan & Biklen, 1992). Of the 61 interviews conducted, 32 took place at the children's health system and 29 took place at the multihospital system. The interviews were administered from June to September 2009. Four interviewers-an assistant professor, an associate professor, a full professor, and a PhD student-were deployed in teams of two to conduct the interviews. At both organizations, the research team used a snowball sample approach whereby it started with the senior executive team and progressed through the organizational hierarchy as interviewees identified other individuals who played important roles in one or more initiatives. Additional interviews ceased when no new individuals were identified as key to the initiatives (Biernacki & Waldorf, 1981). The final list of interviewees included administrators who held titles from assistant director to chief executive officer and physician leaders who served as chief medical officer or chief of a department.
Initial meetings were held with several top leaders of each organization to identify, name, and define a set of change initiatives for each system. On the basis of that information, the researchers developed a script of 15 questions and commenced the individual interviews. Each participant was also allowed time to add information or provide related information that the questions did not probe. All participants were provided documentation concerning the purpose of the study and given an informed consent document to complete prior to the interview. At both organizations, the research team used the combined positional and snowball sample approach described earlier. The responses were collected by each interviewer by means of handwritten field notes and were transcribed and stored in an electronic database.
The survey documented the administrators' rating of the importance of the initiatives, the interviewees' degree of involvement with each initiative, and identification of who else was involved with each initiative. Of particular importance to this study were open-ended questions asking participants to identify critical success factors for each initiative.
Analytical Approach For purposes of this article, we focused on two analytical steps: 1. Compiling demographic data collected to present a profile of the 61 interviewees, including age, gender, healthcare experience, tenure, and rank 2. Conducting qualitative analysis to identify common themes related to success factors for the implementation of change initiatives identified by the interviewees using rich qualitative data from the 61 personal interviews The structure of the qualitative analysis was not led by previous knowledge about success factors or steps toward successful implementation of change initiatives as presented in the literature review. The research team approached the results of the administrators' interviews with the purpose of theory building by identifying all the dimensions and themes related to success factors for the implementation of change initiatives in the healthcare setting. The research team followed grounded theory methodology by applying inductive content analysis when coding the interview data. Team members used open coding and then organized the codes into corresponding subcategories, which resulted in the overarching themes (Strauss & Corbin, 1997). Codes were identified and named at different levels of analysis and consisted mostly of descriptive, with some inferential, code and theme names (Miles & Huberman, 1994). Coding of the interview transcripts was performed in teams of two researchers with the addition of a third independent coder, who validated the initial coding and helped settle discrepancies. The themes and their corresponding codes are presented in Figure 2 and discussed further in the Results section.
Each theme resulted from a pattern identified in the interviewees' responses. During the coding process, the research team made an initial pass through the transcripts followed by a review of the coding and assignment criteria (Miles & Huberman, 1994). Team members met regularly to reevaluate code assignments and corrections based on the definitions resulting from cross-examination. This process helped ensure interrater reliability as codes were assigned, and members reviewed each other's coded material to ensure consistency.
RESULTS First, we offer a brief description of the two research settings, the children's health system and the multihospital health system, including the nature of the strategic change initiatives studied. Second, we present profiles of the interview participants to provide some contextual background to their response. Finally, we present success factor themes resulting from the interviews.
Children's Health System The children's health system is located in a large metropolitan area. Interview participants included executive leaders, vice presidents, directors, and assistant directors in the main operating structure of the organization. This organization was pursuing the following strategic change initiatives: 1. Two building projects-a clinical building to house a new program, and a new satellite hospital 2. Research initiatives involving large investments 3. The launch of a physician service organization to serve as a hospitalbased billing and collections service for staff and contracted physicians' professional fees 4. The implementation and integration of a new electronic health record system (EHR) 5. A medical school consolidation initiative, which involved restructuring and formalizing the system's relationship with a medical partner to improve the overall health of the children in the service area 6. An inpatient quality and patient safety program 7. Various patient flow improvement initiatives 8. A cost containment initiative to improve staff management and resource utilization Multihospital Health System The multihospital system is a large, regional, multihospital health system. The study participants were located at the system's corporate office and were responsible for its overall direction, operation, and financial health. At the time of the analysis, five initiatives designed to transform the way the health system and its member hospitals operated were being pursued as part of the system's strategic plan. Each initiative was associated with specific goals to be met over the next 5 to 10 years and included the following: 1. A culture change initiative, including application to the Malcolm Baldrige National Quality Award program 2. A physician engagement initiative to advance physician alignment with the organization 3. A quality and safety initiative, which focused on reducing medical errors 4. A cost-effectiveness initiative to help the organization improve resource management 5. A provider and coordinator of care initiative to align and integrate patient care and coordination throughout the system Participants' Profiles The results presented in Table 1 address the first analytical step regarding the profile of the 61 interviewees from the two health systems.
The interviewees had from 1 to 41 years of healthcare experience, had been at their current organization from 6 months to 39 years, and included 19 physician administrators. The participants were split almost equally in terms of gender-29 females and 32 males. At the children's health system, the majority of the interviewees held positions of director, chief, or medical director; vice president; or senior vice president. The multihospital health system's interviewees mostly held executive vice president, president, senior vice president, or vice president positions.
Success Factors The qualitative data results were derived from the question about success factors associated with each change initiative identified by the interviewee. The process of inductive qualitative analysis resulted in 39 emerging codes for the success factor responses, which were grouped into 10 overarching success factor themes (see Figure 2).
Next, the 10 success factor themes were organized by strategic change initiative and health system. All code counts associated with the 10 themes are presented in Table 2.
The success factor theme with the highest number of code counts, at 287, was identified as culture and values, followed by business processes, at 247 code counts, and people and engagement, with 206 code counts. The following ranked list presents the identified success factor themes according to the frequency of mentions by survey participants who cited multiple initiatives at their organization.
1. Culture and values 2. Business processes 3. People and engagement 4. Service quality and client satisfaction 5. Coherent planning 6. Financial resources and accountability 7. Leadership 8. Market forces and external demands 9. Access to information 10. Communication Table 3 presents each emerging theme in terms of how codes were identified and used, and the paragraphs that follow discuss these results in more depth as they relate to the existing models presented in Figure 2.
Culture and values. Participants' comments on success factors for specific initiatives most frequently point to support from culture and values in their organization. This theme also encompasses comments regarding alignment of culture and values between individuals and departments; risk taking; and the organization's mission, vision, and values.
Business processes. This theme consists of operational activities in the organization, such as aspects of supply chain management, wait times, throughput, capacity, claims denials, patients' transfers, and definitions of how processes should work.
People and engagement. Comments concerning people revolved around the engagement of people throughout the organizations. Of particular interest were engagement through hiring, training, and education; reducing turnover; and rewarding those who perform well.
Service quality and client satisfaction. This theme contains the greatest number of unique topics or terms and includes the satisfaction of physicians, staff, clients, and patients and the quality of service and outcomes, both financially and operationally.
Coherent planning. Respondents identified planning as a success factor as a means to help identify the scope of both the initiative and the organization's direction.
Financial resources and accountability. The finance theme includes reference to cost, income, margin, funding, collection, bond rating, and budget.
Leadership. This theme relates successful implementation of change initiatives to effective leadership characteristics.
Market forces and external demands. Comments falling under this theme concern the market in which the organizations operated. They include statements about competitors, the relationships that the organization develops with other organizations, and benchmarking with others to assess performance and need.
Access to information. The information theme is concerned with the ability to retrieve data and use those data in decision making. It also involves reports and reporting and contains aspects of accountability and transparency throughout the organization.
Communication. The communication theme addresses the need to communicate both existing and upcoming strategies and change initiatives, relates to the need for leadership to explain expectations, and defines how areas of improvement are identified.
Comparing these 10 success factors with those found in the management literature (see Figure 1) reveals numerous areas of overlap with previous models of successful implementation of change initiatives. These include an emphasis on culture and leadership; matching change in the internal environment to that taking place in the external environment; the need for a coherent planning process to focus on results-oriented organizational change; the need to empower people and develop enabling structures; and adoption of business processes that help institutionalize successful change efforts through formal policies, systems, and structures.
The results of this qualitative study of healthcare administrators' perspectives add to the current literature of successful implementation of change initiatives by making the guidance more relevant to the healthcare sector. For example, on the basis of our results, we are able to add the following two important success factors as identified by healthcare leaders: (1) service quality and client satisfaction and (2) access to information. These themes are clearly relevant to the healthcare sectorespecially the hospital setting-as payers and regulators increasingly demand that organizations demonstrate evidence of both. Furthermore, the importance of care quality and client satisfaction is recognized as an outcome and a driver (success factor) for other change initiatives. For example, participants in our survey frequently associated this factor with the success of building projects, physician engagement, and culture change.
Finally, results from this study reveal the importance of culture and values, people and engagement, business processes, and service quality and client satisfaction relative to the traditional success factors of leadership and communications that are noted in the management literature.
DISCUSSION This qualitative analysis of in-depth interviews with leaders at two large health systems offers valuable insights about factors deemed critical to the success of strategic change initiatives in such organizations. These insights may offer important lessons to other healthcare leaders pursuing successful implementation of related changes.
The findings from this analysis demonstrate the importance and relevance of culture and values, business processes, people and engagement, and service quality and client satisfaction as the top four critical success factors for implementing strategic change initiatives.
The success factors we identified also suggest that added attention to factors that are traditionally considered by the strategic management literature to fall in the lower half of the value chain (Duncan, Ginter, & Swayne, 1998; Porter, 1991; Swayne, Duncan, & Ginter, 2008) might be useful. The lower half of the value chain includes support activities, such as initiatives related to people, teams, the culture of the organization, other human resource topics, and technology; the upper half includes service delivery activities, such as those taking place before, during, and after clinical care, and marketing efforts.
The top three success factors identified by the healthcare leaders we surveyed connect most directly to the lower half of the value chain (support activities). This finding suggests that many strategic change initiatives rely heavily on the successful performance of leaders who are focused on managing support services, namely the administrative team in charge of supporting organizational culture, human resource management, and employee training and empowerment. The fourth success factor, clinical quality and safety, cuts across support services and service delivery in the organizational value chain and would involve joint administrative-clinical teams engaged in quality improvement, patient safety and flow, and patient satisfaction initiatives.
Furthermore, on the basis of the new knowledge resulting from this study, we argue that in the healthcare setting, culture, people and engagement, and service quality are more relevant success factors than are leadership and communication factors, frequently identified in the broader management literature. Thus, effective healthcare leaders engaged in successful implementation of change initiatives are most concerned with building and communicating the right culture and values and engaging people in the provision of high-quality service resulting in expected levels of customer satisfaction. It may be the case that in "professional organizations" such as healthcare organizations, a premium is placed by leaders and managers on the instrumental content of leadership and communication, such as culture, quality, or business processes, rather than leadership and communication processes per se.
In addition, access to information is needed to enable the gathering, monitoring, and communicating of service quality and client satisfaction data. Access to information was most often mentioned in our survey as a success factor with respect to change initiatives that address quality and patient safety; it is also one of the most frequently mentioned elements with respect to the success of a physician services organization initiative. Finally, access to information is valuable when engaging people in change initiatives and the planning process, and it provides healthcare organizations the ability to track and react to external demand and market forces on a timely basis (Chen, Mocker, Preston, & Teubner, 2010; Macintosh-Murray & Choo, 2005).
The addition of the quality and safety and access to information themes to the list of success factors identified in broader management literature is of critical importance in two respects. First, in the health services industry, the treatment of patients is a central work product. Thus, "getting it right" should be a key success factor considered in the pursuit of any other initiative, such as physician engagement, culture change, or EHR implementation. Second, the fact that these healthcare leaders added access to information as a strategic change success factor may underscore the likelihood that, compared to organizations in other industries, healthcare organizations collect more information on more people and transactions more often than do other types of organizations, yet healthcare entities find much of that information inaccessible in support of strategic change. Increased attention to information technologies, including structures and access, as a success factor in strategic change is likely to occur in modern organizations to status equaling or surpassing many traditional administrative components (Gamm, Bolin, & Kash, 2005; Gamm, Kash, & Bolin, 2007).
Examining success factors from the perspective of organizational leaders attending to multiple change initiatives simultaneously sets this study apart from most other studies on the topic and supports another observation relevant to practice: Many of the leaders voluntarily identified success factors as the object or target of change initiatives. For example, few following the health information technology literature would argue that most organizations trying to implement EHRs, meet meaningful use requirements, and achieve the associated financial benefits are attentive to how they might optimize the EHR implementation to enhance quality and safety improvements or promote quality reporting to critical payers. Our analysis suggests that many healthcare leaders are aware, at some level, of such essential interdependence of multiple change initiatives as success factors for one another. Giving formal attention to such realizations may prove to be valuable as organizations pursue strategic change.
Limitations Although our in-depth study offers new insights into relevant success factors for strategic change implementation in hospitals, it also suffers from limitations related to sample size and scope. Results from the study are not general izable across all U.S. health systems and hospitals.
ACKNOWLEDGMENTS This study was funded by National Science Foundation Center for Health Organization Transformation Grant No. IIP-0832439.
PRACTITIONER APPLICATION Michael F. Fiulefeld, senior vice president and chief operating officer, Ochsner Fiealth System, New Orleans, Louisiana With the advent of healthcare reform and an emphasis on the transition from volume-based to value-based payment models, Kash et al.'s article is both timely and relevant. The authors polled 61 healthcare leaders and identified their top three success factors for implementation of change initiatives: (1) culture and values, (2) business processes, and (3) people and engagement. In general, I agree with their assessment. However, I have found that all three factors are equally important and that communication and access to data are also critical to success.
At Ochsner, we believe that care for our patients comes first. Therefore, our initial communications to our administrative leaders, physician leaders, and frontline physicians about significant change, such as our move from a homegrown electronic health record system to Epic, sought to align the benefits of the new system with our culture and values of patient-centered care. These communications reiterated that the ultimate beneficiary of a successful Epic launch would be the patient.
When we effectively communicate the "why" of a change event, the results tend to be significantly more positive than when we do not. Conversely, when stakeholders do not understand why we are embarking on a certain path, mediocrity can be the outcome.
Our conversion to the Epic system serves as an example of how Ochsner has applied the principles described in the article. An integral part of our culture and values is the group practice model on which the organization was founded. Thus, we focused on achieving physician buy-in prior to the decision to move to Epic. As the article suggests, we approached buy-in by invoking not only culture and values but also business process factors. For example, we extolled the benefits of customization, workflow optimization, and a clinical solution across all components of our organization.
Once we went live with Epic, we had to ensure that our physicians and staff were fully engaged-the people and engagement factor discussed by Kash et al. Our dedicated Epic team helped physicians with order entry, technological issues, and training. The executive team rounded throughout the go-live period to provide support, and we continue to provide Epic support to all of our physicians at each campus to ensure a successful transition.
I also agree with the authors' comment that access to data is key to a successful change initiative in a physician services organization. As the market changes and more physicians become employees of health systems, access to data is a success factor that should not be minimized. In this regard, physicians and leaders must develop the skill set for how to successfully manage physician practices.
The transition to Epic is just one of many change initiatives that I have been part of at Ochsner. The top three themes that Kash et al. refer to in their article remain important to implementing change initiatives, as are communication and access to data. As the financing of healthcare delivery changes and innovations in care delivery develop, Kash et al.'s findings will become even more important.
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Bita Arbab Hash, PhD, FACHE, assistant professor, Texas A&M University Health Science Center, College Station; Aaron Spaulding, PhD, assistant professor, Brooks College of Health, University of North Florida, Jacksonville; Christopher E. Johnson, PhD, director, Graduate Program in Health Services Administration, School of Public Health, University of Washington, Seattle; and Larry Gamm, PhD, director, Center for Health Organization Transformation, Texas A&M University Health Science Center (c) 2014 Health Administration Press
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