The other silos in healthcare organizations: managing four life assets may help you break down your organization's silos and optimize results

Healthcare Financial Management, May, 2007 by Scott MacStravic

The dangers in organizational and information "silos" that keep different functions, departments, and databases separate and lacking in "interoperability" have long been recognized in healthcare organizations. In marketing, for example. there have been many critics of "service line" thinking, because it focuses on separate categories of what organizations deliver, ignoring the fact that, in many cases, the same patients and families use them. In management, getting separate departments and functions to coordinate and integrate their efforts is likened to herding cats. Even getting physicians in different specialties to work together can be a major challenge.

But however difficult these kinds of silos make management and marketing, silos of the mind may be even more daunting and dangerous. One of the best examples involves the silos that often separate the "life asset" categories that determine healthcare organizations" relationships with their employees, and thereby their employees' overall performance and the organization's success and survival.

Chief Life Assets

There are arguably four chief life assets, categories of the "stuff" it takes for people to live and work well. These life assets largely determine the extent to which people succeed for themselves and for the organizations where they work:

* Competencies or talents--the breadth and depth of knowledge, skills, and attitudes people bring to their lives and organizations that, when well developed and managed, promote better performance

* Health--physical, mental, emotional, social, and even spiritual well-being that, when well developed and managed, has the same effects

* Time--the combination of how much time is made available for employees to use by their organizations' policies and procedures, and how well employees manage their time, at work and outside, with resultant effects on their performance. their health, and their happiness

* Wealth--both how well employees are rewarded, and for what, and the effect their "financial health" has on their performance, health, competencies, time, and lives

Although clear and easily defined differences separate these four life asset categories, they interact so significantly that it is their connections that should be recognized and exploited. rather than their "silo-like" distinctions. For example, all four can be significant factors in promoting or impairing employee performance. and all four can be major determinants of success in employee recruitment and retention.

Health has long been recognized as a major factor in determining whether employees are even present at work on a given day, and how productive they are if present. Competencies can make dramatic differences in how well different employees perform, but developing new and maintaining existing competencies can be major factors in recruitment and retention, even substituting for increases in compensation for many.

Time and how it is managed at work is a major factor in performance, as well as a major source of stress and negative effects on health, while time off and choices given to employees on when and where they work can improve both productivity and retention. Offering concierge services to employees can make dramatic differences in their available "discretionary time" and how they use it, while time off may be as much a reward as added compensation for many.

Although wealth has long been a major factor in promoting performance, incentives and rewards are also useful in promoting health and competence, and even in facilitating time management. Paying for performance can have a dramatic impact both on overall performance and on selective retention of high performers, who may otherwise be the most likely to leave. Health can significantly influence compensation, as does competence and time management, since all three influence performance.

Starting with Results

The key to overcoming disconnects caused by silo thinking is to begin with the results that organizations want, and work backward through all four life assets as potential means to promote and improve such results, rather than start with the separate assets and work forward. The four asset categories may be used as different options for achieving the same results, or as the foundation for an integrated approach to optimizing results.

Wealth asset strategies have long been the most frequently used methods for promoting results, through linking compensation (wages, salaries, bonuses, etc.) to the specific results desired. In one example, a windshield repair firm increased its overall productivity by 44 percent in one year by simply switching from a traditional hourly wage to a productivity-based pay-for-performance system. (E. Lazar, "Performance Pay and Productivity," American Economic Review. December 2000, pp. 1346-1361.)

But time asset strategies also work, as illustrated by Best Buy when it adopted a "Results Only Work Environment" policy. When adopted at its corporate headquarters, the policy meant that all employees could choose whether, where, and when to work on any given day, as long as they produced the results expected in terms of processing orders. This policy yielded an immediate 35 percent increase in productivity, as well as a reduction in staff turnover from an average of 16.6 percent in past years to 0.0 percent in the first year of the new policy.