00 cover vol48.3 - Henry Mintzberg

1 Healthcareleadership04 World Hospitals and Health ServicesVol. 48 No. 3 ABSTRACT: Myths impede the effective management of health care, for example that the system is failing (indeed, thatis a system), and can be fixed by detached social engineering and heroic leadership, or treating it more like a field needs to reframe its management, as distributed beyond the top ; its strategy as venturing, not planning; itsorganizing as collaboration beyond control, and especially itself, as a system beyond its abound in management, for example that seniormanagers sit on top (of what?), that leaders are moreimportant than managers (try leading without managing),and that people are human resources (I am a human being).Myths abound in what is called the system of health care too,not least that it is a system, and is about the care of health (mostlyit is a collection of treatments for disease).

2 Combine these twosets of myths, as is increasingly common these days, and you endup with the mess we now face in the world of health us begin with the myths of managing now prevalent in healthcare and then turn to some reframing that may help to escape #1: The health care system is to peoplealmost anywhere in the world and they will tell you how theirsystem of health care is failing. The truth is quite the opposite: Inmost places in the developed world, health care is succeeding expensively. In other words, success is the problem, not almost any statistic. We are living longer, losing fewerinfants, and so on, in large part because of advances intreatments. The trouble is that many of these are expensive, andwe don t want to pay for them certainly not as healthy peoplethrough our insurance premiums or taxes.

3 So health care servicesget squeezed, and it looks like the system is failing. In fact, as weshall discuss below, the problems are not in the health careservices themselves so much as in the consequences of ourinterventions to fix this ostensible failure. We consider threeinterventions in particular: social engineering, leadership, andbusiness #2: The health care system can be fixed by cleversocial system is broken so the experts haveto fix it: usually not people on the ground, who understand theproblems viscerally, but specialists in the air, such as economists,system analysts, and consultants, who believe they understandthem conceptually. Thanks to them, in health care we measureand merge like mad, reorganize constantly, apply themanagement technique of the month, reinvent health care everyfew years, and drive change from the top for the sake ofparticipation at the all this and all will be well, we are told.

4 But is it ever? InHENRYMINTZBERGPCLEGHORNPROFESSOROFMANA GEMENTSTUDIES,MCGILLUNIVERSITY,CANADA particular, at this so-called bottom, the real experts struggle tocope with the pressures, not least from these very solutions, most of which seem to make things increasingly if, instead, we came to appreciate that effective change inhealth care has to come largely out of the operations, and diffuseacross them rather than forced down into them? Consider, forexample, the changes in recent times that have made the greatestdifferences, not only in cutting costs that s the easy part butalso in improving quality. Day surgeries have to be near the top ofthat list. This idea came from engaged clinicians, not detachedsocial #3: Health care institutions as well as the overallsystem can be fixed by bringing in the heroic can certainly help, at least when it replaces a leadershipthat was worse.

5 But what does effective leadership mean in a fieldwhere the professionals have so much of the power? In hospitals,for example, physicians are usually far more responsive to theirown hierarchies of professional status than the managerialhierarchies of formal authority. Hence what can be called heroicleadership , so fashionable now in business (witness the wholesystem of bonuses), can be bad for health care, let alone : managers who are deeply and personally engagedso as to be able to help engage #4: The health care system can be fixed by treatingit more as a is a particularly popular prescriptionin the United States. Perhaps no country on earth treats healthcare more as a business, or is more encouraging of competition inthis field. But given America s current state of performance farmore expensive than anywhere else, with overall quality rankingsthat are mediocre shall we take this as testimonial to thewonders of competition and business practices in the field ofhealth care?

6 The United States spends about 31 of every health care dollaron administration; Canada, with much less competition and farless of a business orientation in health care, spends about 17 ,and achieves better measures of quality. To quote from an articlein theNew York Times: Duplicate processing of claims, largenumbers of insurance products, complicated bill paying systemsManaging themyths of health care04-07 Henry :48_3 23/10/12 10:13 Page 4 World Hospitals and Health ServicesVol. 48 No. 305 Healthcareleadershiptwentieth century, arguably the three most significantpharmaceutical developments penicillin, insulin, and Salkvaccine all came out of not-for-profit laboratories.)The Myths of Measurement and of Scale Measurement is a fineidea, as long as it does not mesmerize the user. Unfortunately, itso often does: both managers who rely on it for control andphysicians who believe that being evidence-based always has totrump being experienced-based.

7 Management and medicinealike have to balance these two in order to be , too much of health care at both the administrativeand clinical levels has been thrown out of balance by theirobsessions with the management of health care, the frustration of trying tocontrol rather autonomous professionals has led theadministrators and social engineers to a reliance on this, it should be noted, is no less prevalent in private sectorcontrol by insurance companies and HMOs, etc, than in publicsector control by government problem with measurement is that, while the treatmentsexist in standard categories certain medications for manic-depression, particular forms of angioplasty for various heartconditions, etc. their outcomes are often not standard, andtherefore can be tricky to pin down by measurement. That isbecauseweasindividualpatientsarenotsta ndardized,andsoourtreatments have to be tailored to our individual needs is often said that If you can t measure it, you can t manage it.

8 Well, who has ever adequately measured the performance ofmanagement? (Don t tell me it can be done by looking at a stockprice.) In fact, who has ever even tried to measure theperformance of measurement itself? I guess we must concludetherefore that neither management nor measurement can what can be done if we cannot rely wholly on measurement?That s easy: use judgment. Remember judgment? Can youimagine medicine without judgment? Well, then, I suggest that younot try to imagine management without judgment favors large scale; in fact scale is a society mesmerized by measurement is a society obsessedwith large scale. Hence the small hospitals are the ones that getclosed. Herzlinger wrote in her 2006 Harvard Business Reviewarticle that Health care is still an astonishingly fragmentedindustry. More than half of the US physicians work in practices ofthree or fewer doctors; a quarter of the nation s 5,000 communityhospitals and nearly half of its 17,000 nursing homes areindependent.

9 But what is wrong with that? She added that Youcan roll a number of independent players into a generate economies of scale . Picture that!Notice the term: economies of scale. Not effectiveness of scalebut economies of scale. Too much of the management of healthcare has come to be about using scale to reduce measurablecosts at the expense of difficult-to-measure am not trying to make the case that smaller is always morebeautiful, only to plead that bigger is not always better. Scale, too,has to be judged, especially for its impact on performance. Healthcare as a calling works best in units that are as humanly small asthe best of technology allows. This, in fact, seems to hold trueeven in pharmaceutical research. To quote Roger Gilmartin whenhe was chief executive of Merck: Scale has been no indication ofand high marketing costs [plus all the paperwork required ofAmerican doctors and hospitals that simply do not exist incountries like Canada or Britain ] add up to high administrativeexpenses (Bernasek 2007).

10 In the name of competition, Americanhealth care in fact suffers from individualization: every professionaland every institution for his, her, or again, let s try it differently: Health care functions best as acalling, not a business; as such, it needs greater cooperation, notcompetition, among its many players and institutions. Physiciansmay be well paid, but these are smart people capable of earninglarge incomes elsewhere. What keeps many, if not most, of themin health care is the sense of service. This applies equally, if notmore so, to the nurses, who don t earn that kind of money, andmany of the managers too. What happens to health care as acalling when it is seen as one-stop shopping , hospitals as focused factories , patients as customers and consumers ,and physicians as industry players (as described by Herzlinger2006)?