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Culture Eats Strategy for Lunch

07/22/2015

Industry expert Paul H. Keckley, PhD, writes weekly about issues and ideas relevant to health policy. His July 20, 2015 column "Culture Eats Strategy for Lunch" discusses how our business is changing and what we ought to focus on to define success. The column is reprinted in its entirety below by permission of the author. To sign up and receive The Keckley Report weekley, access www.paulkeckly.com.

Culture Eats Strategy for Lunch

The following is an excerpt from Navigant Healthcare’s Pulse Weekly.

Last week, I spent time at Microsoft, Amazon and Starbucks’ headquarters in Seattle learning about these companies, and more importantly, listening to several of their newest talent.

These companies are big: their current market capitalizations are $378 billion (Microsoft), $225 billion (Amazon) and $85 billion (Starbucks). They’re complicated, deploying logistics, technology, workforce, regulatory, and marketing resources across global operations. They focus on their unique user experiences, their brands and maximizing investor returns. And Millennials are everywhere staffing important positions while feeding on the energy of their peers and their workplaces.

Each of the three has an impressive mission statement that’s prominently displayed—in the 8th floor foyer in Starbucks’ restored Sears tower, in each of the 100 buildings that dot the sprawling Redmond Microsoft campus, and in Amazon’s 15-building urban complex in downtown Seattle. Remarkably, despite differences in their industries, these mission statements and corporate values seem similar: they’re about growth, innovation, value, market leadership, and social responsibility.

From their leaders, I heard about changing market demands, emergent technologies, and sources of revenue and enterprise growth. There’s no fear of change: it’s embraced and energizing. They said they feed on innovation: there are no emperors in their organizations and respectful dissent an obligation. And they celebrate their mistakes as a reflection of their willingness to try “something new”. They compete to win.

These insights were useful, though not surprising. Every company has its traditions, and all have a tendency to have amnesia about failures and put their best foot forward. Touring headquarters and seeing firsthand where and how their sausage is made was enlightening. But listening to five Millennials over dinner Saturday might have taught me more.  I learned…

At Starbucks, the employees contribute to a hardship fund for employees who have tough times—and they determine its use. “Howard” (Howard Shultz, CEO) is man on a mission to solve complex social problems like race relations and social consciousness. Sometimes these efforts produce unwanted distraction (like the “Race Together” campaign recently pulled) but they’re always well intentioned. Work-life balance matters to Starbucks and their employees know it. And at the heart of the company is the art of connecting with a customer over a cup of coffee. “Connecting” is a powerful symbol in Starbucks!

At Microsoft, individual offices are an artifact that’s giving way to open space and collaborative teaming. Being big is not important, being best is the goal; admittedly Microsoft lost its swagger in recent years and is on a mission to regain its stature. The company is a collection of enterprises with distinct capabilities and a shared value: they love geeks! There are geek crossings and geek fairs. And it mattered to my new geek friends that a former clerk now leads an important design project having no prior training but zestful enthusiasm and an inquiring personality. At Microsoft, silos and job descriptions mean little.

And at Amazon, everyone flies coach to reinforce the value of frugality. There, logistics is king: getting orders right and deliveries on schedule is everyone’s job. Logistics is about the little things, and Amazon wants to be the best at the little things. And being downtown in the buzz of creativity and hub of commerce is key to getting and keeping a productive, growing workforce.

I have been in healthcare my entire career. It’s a complicated industry that’s 1/7thof the entire U.S. GDP and 1/4th of the total federal budget. We’re prone to think we’re different: we reason that diagnosis and treatment, clinical research, third party payment, drug manufacturing, et. al. make us different than any other.

But we have much in common with Microsoft, Amazon, Starbucks and others. We depend on capital for growth and technology-enabled innovation. We have folks with big titles and many without. We care about user experiences—our members, patients, and customers. We value growth and innovation. We protect our brands, and we pay close attention to capital markets (lenders/investors) with whom we are co-dependent. And Millennials are no less important to our successes than those in Silicon Valley and Seattle.

At dinner, my five “young invincibles” talked about “not drinking their company’s “Kool Aid” and the authenticity they seek in the leaders and co-workers they respect. They enjoy work, but the paycheck is not their primary motivation. It’s about what they can learn, what they can contribute, and life beyond their workplace.

Reflecting, I found myself thinking about the healthcare workforce, especially the hoards of young analysts, clinicians, caregivers, marketers, researchers, and client service professionals we employ. Their views, and how they’re engaged, might be more important than the mission statements and values on our walls and websites. Our Millennials ask the same questions as those of my dinner guests…

How’s our business changing, and does our organization have a vision of the future? Do we embrace change, or seek to restrain its impact? How are competent individuals rewarded, and those less so removed? How is dissent encouraged and ideas harvested? Are we keeping the best and brightest or losing them? How are we improving the user experiences for our customers? How do we define success? Is profit the end game or part of a bigger story? And where’s the meaning and purpose in the role I play?

At Microsoft, Amazon and Starbucks, a key to their success rests in how they sustain a culture that attracts and keeps a workforce seeking more than a job. Their strategies matter, but as Peter Drucker, the famed management guru, once remarked “culture eats strategy for lunch.”

In healthcare, the same is no less true. Perhaps we should be as intentional about the cultures we aspire to build as we are the strategies we deploy to navigate the transition from volume to value.

Paul

PS: Thank you Regina, Isshy, Mark, Lauren and Josh for reminding me about what matters most about work.

The opinions expressed in this article are those of the author and do not necessarily represent the views of Navigant Consulting, Inc. The information contained in this article is a summary and reflects current impressions based on industry data and news available at the time of publication. Any predictions and expectations noted herein are inherently uncertain and actual results may differ materially from those contained in this article. Navigant undertakes no obligation to update any of the information contained in the article.

©2015 Navigant Consulting, Inc.