Leadership
Physicians, Executives, and the Power of Alignment

Leadership Survey: Why Big Gaps in Organizational Alignment Matter

Insights Report · March 22, 2018

Analysis of the NEJM Catalyst Insights Council Survey on Leadership: Providers, Executives, and the Power of Alignment. Qualified executives, clinical leaders, and clinicians may join the Insights Council and share their perspectives on health care delivery transformation.

Advisor Analysis

By Stephen Swensen and Namita Seth Mohta

When people talk about transformation in health care, they tend to focus on the work that needs to be done to move a health care organization forward, such as changing care processes. But that’s only half the story. Equally important is an assessment of a team’s readiness to take on transformation. And the best gauge of that lies in the question, is everyone in your organization aligned?

When we ask this of NEJM Catalyst Insights Council members — a qualified group of U.S.-based clinical leaders, clinicians, and executives who are directly involved in health care delivery — they return a resounding “no.” In our recent Leadership survey, “Providers, Executives, and the Power of Alignment,” we observe remarkable gaps in the alignment that respondents consider necessary between key stakeholders and the degree of alignment they perceive within their organizations. For instance, although 91% of respondents say it is extremely or very necessary for frontline clinicians and top executives such as the CEO to be aligned, only 30% consider their own health care organization to be extremely or very aligned among these stakeholders.

True alignment has numerous positives, not the least of which are better patient outcomes (according to 62% of survey respondents) and organizational stability in a dynamic, changing health care marketplace (56%).

To be clear, we are not conflating alignment with agreement. Not everyone is going to agree with every decision, but they have to understand why certain decisions are made. Our survey results are bleak in this respect — only 21% of respondents say alignment approaches are formally stated in their health care organization, while just under a quarter say the approaches are tacitly understood. Nothing this important should be left unstated.

These findings from the Insights Council are not an acceptable foundation if you are to successfully transform your organization.

How to Achieve Alignment

One place to start gaining alignment among key stakeholders is in the definition of the term. The largest share (48%) of our respondents say alignment is achieved when “the organization’s mission, vision, and goals are supported by governance, strategy, and incentives.” Only 5% label alignment as a “financial model [that] incents providers and executives toward common goals.” This result is unsurprising, since the predominant financial models today are not aligned with patients’ best interest, physicians’ best interest, or even organizations’ best interest. There’s huge overuse in health care that has at its root a payment system based on more tests and more procedures — a production model that doesn’t serve anyone well.

Health Care Organization Alignment Approaches Are Muddled

From the Leadership Insights Report: Why Big Gaps in Organizational Alignment Matter. Click To Enlarge.

The next step is figuring out which stakeholders require the most alignment. According to our survey, these are frontline clinicians and clinical leaders such as the Chief Medical Officer; 93% of respondents score their necessity of alignment as extremely or very necessary. At the other end of the spectrum are executives and patients, for which 55% of respondents say alignment between the two is extremely or very necessary.

As you then chart the actual degree of alignment within your own health care organization, in comparison, you’ll see what needs to be bridged. In our survey, despite calling alignment between frontline clinicians and clinical leaders a necessity, only 36% of respondents say there is a high degree of alignment in their own organizations. That’s an incredible mismatch that must be addressed.

So how can you drive your health care organization toward alignment? We look at it from two different perspectives: within the leadership team, and among the leadership team and clinical providers. For both groups, agreement on vision and strategic plan is most important, according to our survey. Interestingly, Insights Council members find it far more important for administrative leaders to have clinical training/experience than for clinical leaders to have business training/experience. We think this is short-sighted, as new models will require clinical leaders to have business and financial savvy to make the most impact.

As you seek to align your own organization, physician compensation models are one place to start. Only a quarter of respondents say physician compensation for employed physicians is extremely or very aligned with organizational strategy, mission, and goals. With so many physicians turning to employment in recent years, the hiring organizations likely expected more alignment in exchange for putting salaries on their books. The situation is even worse with affiliated physicians, where only 10% are highly aligned.

Leaders and clinicians alike must evaluate the degree of alignment at every level of their organizations. Otherwise, as you dive deeper into health care transformation, you will encounter a lot of friction and wasted energy.

VERBATIM COMMENTS FROM SURVEY RESPONDENTS

What single change should your health care organization make to significantly improve provider alignment?

“Address burnout by going to providers to understand their struggles and actively find solutions immediately.”
— Clinician at a small nonprofit hospital in the West

“Administration needs to be transparent re: financial challenges, short and long term goals, responsive to physician/clinician concerns.”
— Clinician at a mid-sized nonprofit hospital in the Northeast

“COMPROMISE. Admin MUST CHANGE their MINDSET to allow willing and able clinical leaders to the real table while clinicians MUST learn to view reform as an OPPORTUNITY to do far better for patients and our profession.”
— VP of service line at a large nonprofit health system in the South

“Cultural alignment (values, beliefs, behaviors/processes). Employing providers by a health system constitutes merging two completely different business models. Failure as in most mergers comes from lack of cultural change on both sides. It cannot be the doctor culture or the system culture that prevails. It must be a new culture. Addressing this issue is uncommon if it ever happens.”
— VP of a large for-profit community hospital in the South

“Leadership opportunities and front line clinical leadership engagement on operational matters that also includes financial metrics.”
— Chief of service line at a large nonprofit hospital in the West

Download the full report for additional verbatim comments from Insights Council members.

Charts and Commentary

by NEJM Catalyst

In December 2017, we surveyed members of the NEJM Catalyst Insights Council, who comprise U.S.-based clinical leaders, clinicians, and health care executives, about provider-executive alignment. The survey covers the definition of stakeholders’ alignment; why organizational alignment is important; the necessity of and degree of alignment among key stakeholders; drivers to improve alignment within the leadership team and among the leadership team and clinical providers; physician compensation alignment with strategy, mission and goals; and the transparency of stakeholder alignment approach. Completed surveys from 655 respondents are included in the analysis.

Many Different Definitions of Stakeholder Alignment in a Health Care Organization

From the Leadership Insights Report: Why Big Gaps in Organizational Alignment Matter. Click To Enlarge.

With no definitions chosen by more than half of Insights Council members, it is clear they are not in sync on what is meant by health care organization alignment. While 57% of the clinical leaders and executives responding to the survey say alignment is “the organization’s mission, vision, and goals . . . supported by governance, strategy, and incentives,” only 37% of clinicians choose this definition. More clinicians (17%) than executives (9%) and clinical leaders (7%) say alignment is achieved when “all functions of the organization are directed toward patient care.” “The financial model incents providers and executives toward common goals” is scored higher by Council members from for-profit organizations (10%) than those from nonprofits (4%).

Download the full report to see the complete set of charts and commentary, data segmentation, the respondent profile, and survey methodology.

Check NEJM Catalyst for monthly Insights Reports not only on Leadership, but also on the New Marketplace, Care Redesign, and Patient Engagement.

Join the NEJM Catalyst Insights Council and contribute to the conversation about health care delivery transformation. Qualified members participate in brief monthly surveys.

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