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Management Lessons from the Cleveland Clinic

Only outstanding leadership—at all levels of the hierarchy—can pull a hospital, or any company, through difficult times like the ones we’re experiencing today. But (and here's the trillion-dollar question) what does outstanding leadership actually look like?

A successful leader must hold everyone accountable, top to bottom.  Advancing the mission, personal accountability, and sense of responsibility are incentives, not threats. The convergence of innovation, value, effective communication, and follow-up comprise real leadership.

Throughout my many years working in health care, I’ve learned some basic lessons that will resonate with leaders in any business.  For example:

Before you make a decision, ask yourself three key questions:
1. Do I really understand the issue at hand and could I explain it to my colleagues?
2. Will there be any unintended consequences?
3. What will happen if we don't decide now?

As James Thurber wrote in the New Yorker many years ago, “It is better to ask some of the questions than to know all of the answers.”  It's said that Japanese businesspeople, once they have all the facts, will ask why five times before making a decision.

Pay close attention to the competition. Their vulnerabilities can provide good ideas—and perhaps even a new direction—for your organization. Remember, they have the same interests as you: to seek or create demand, accelerate access, improve quality metrics, market value and grow most services internally and by outreach.  Just don't let yourself become so obsessed with your competition that you can't see them clearly or learn from them. In other words, don't underestimate them, but don't waste your time “hating” them.

Understand that change is inevitable.

As leaders, we can manage it in one of four ways:

1. We can resist change. But this doesn't advance the organization, and the tide of change carries the resisters along anyway. The fates lead the willing and drag the unwilling.
2. We can whine.  Some people think whining makes you feel better by "getting it out of your system." Actually, it's better to substitute handwringing with activity. As Osler pointed out, "waste of energy, mental distress, nervous worries dog the steps of the man who is anxious about the future."
3. We can panic.  This could be fatal. You can fight panic through faith in leadership and faith in each other. Sometimes people rise to greatness at critical times and you can't predict who it will be. That's why leadership development is important.
4. We can pull together. This is what our group model of medicine is all about—to pull together, to act as a unit. Real teamwork is unity of purpose and a natural diversity of excellence.

Strive to live by the four proven principles of enduring success:

1.  Exploit before you explore—that is, exploit existing assets and capabilities before you develop new ones (exploitive actions are generally local and market-driven).

2. Diversify the business portfolio.

3. Remember your mistakes.

4. Be conservative about change. Great companies very seldom make radical changes. Major organizational change rarely creates value.

Make sure your growth efforts fit a deliberate strategy. If a merger or acquisition is in your future, be careful. A blind allegiance to growth can waste a lot of money. Growth may add revenues, but it can also induce market share conflicts that end up costing more than the organization gains in true profit. Growth by itself is the scoreboard; it's not the game.

In our zeal for expansion, we should remember Peter Drucker's admonition:  “I will tell you a secret: dealmaking beats working. Dealmaking is exciting and fun, and working is grubby. Running anything is primarily an enormous amount of grubby detail work, and very little excitement, so dealmaking is kind of romantic, sexy. That's why you have deals that make no sense."

Even if the people on your team don't like each other, they must trust each other. Trust between two people does not necessarily mean that they like one another. It means they understand one another. Diversity in talent and personality matters. Homogeneous teams do little to enhance expertise and creative thinking.11 Give me strong-willed, tough but fair, dedicated and really smart executives, and we will show great results and real progress no matter how onerous the market or the reimbursement.

Never forget the importance of a satisfied patient (customer). In health care, as in any business, a brand is a statement of trust between you and the customer. Satisfied customers will tell other people about your company and many of those people will become your customers.  Therefore, the best opportunity for increasing sales is through satisfying your present customer base and cultivating new customers. Superior service will bring in customers, keep them, and multiply the value of their accounts. Remember, it takes five times as much time, effort, and money to attract a new customer as it does to keep a current one.

Most complaints never reach the chief of staff or the chief executive's office. It is the role of the department head or the individual to listen to complaints and follow up with corrective action and make amends. Prevention is the best medicine.  And the best advertisement is a satisfied patient.

In health care, we are part of a process, a community, a movement, and a historical continuum that exists by the mutuality and trust of all involved.  Without trust, a leader cannot practice or lead in medicine or in any other field. With trust, you can energize staff and employees to reach heights they may never have imagined possible. You might not be able to always inspire the team, but you can stretch their performance. Measure your success the way Hall of Fame basketball player Bill Russell did: “I'll judge the game on how I made my teammates good enough to win.”

Adapted with permission from Leadership and Medicine (Fire Starter Publishing, 2009) by Floyd D. Loop, M.D.

1. Osler W. A Way of Life. New York: Dover Publications, 1958.
2. Reingold E. Interview with Peter Drucker. Facing the "Totally New and Dynamic." Time, January 22, 1990.
3. Drucker, P. F. Managing Oneself. Harvard Business Review (1999) 77 (2): 65–74.
4. United States Office of Consumer Affairs. Consumer Complaint Handling in America: An Update Study. Completed in 1986 and released during National Consumers Week, 1986, Washington, Technical Assistance Research Programs Institute (TARP), for the United States of Consumer Affairs, 1986.
5. Quoted by Jim Calhoun, head basketball coach, University of Connecticut, in an interview with Charlie Rose, December 27, 2007.

About the Author(s)

Floyd D. Loop, M.D. Floyd D. Loop, M.D., is a distinguished cardiothoracic surgeon and former CEO of the Cleveland Clinic.  During his tenure as chief executive, Dr. Loop and his leadership team reorganized the Clinic and transformed it into a major academic medical center. He is the author of the new book Leadership and Medicine (Fire Starter Publishing, 2009) on which this article is based.  For more information, visit www.firestarterpublishing.com