Roles for Health-System Governors:

Leading Innovation

National Health Leadership Conference 2012

Matthew Lister

With Thanks…

• John King, SVP, St Michael’s Hospital, Toronto

• Cathy Szabo, CEO, Central CCAC, Toronto

• Cathy Ulrich, CEO, Northern Health BC

• Mary Ackenhusen, COO, Vancouver Coastal Health

• Robert Hamilton, McGill University Health Centre, PQ

• John Bullivant, Director, Institute for Good Governance (UK)

• Mark van Clieaf (MVC Associates)

• Nizar Ladak, COO, Health Quality Ontario

• Alberta Health Quality Council

• Mike O’Keefe, Chair, Eastern Health Newfoundland

• Joanne Dykeman, VP Quality, Revera

• Spencer Gear, CIO, MOSAIC (US)

• Professor Tony Davies, University of the Witwatersrand, South Africa

• Captain Catherine Bonhoff, Executive Officer, US Air Force (US)

• Professor Derrick Crooke, Nuffield Department of Clinical Medicine, Oxford University (UK)

• Professor Claus Rerup, Richard Ivey School of Business

• Dr. Les Levin, Medical Advisory Secretariat, Ontario

• Jerry Koh, Ontario Ministry of Health & Long Term Care

• Joan Lister, CEO, HealthComm

• Wayne Marsh, Independent Facilitation Services

• Gail Garland, CEO, Ontario Bioscience Industry Organization (OBIO)

• Prof. Dr. Yusuf Çelik, Hacettepe University, Turkey

• Peter Tanaka (deceased), CEO, Comcare Health Services

Governance & Innovation Questionnaire

Clinical

Infrastructure

Administrative

Please Identify: 1. Your region

2. Your organization type

3. Drivers (requirement, discovery, policy, etc.)

4. People involved

5. Who initiated it/them

6. Current status

7. Obstacles faced

Workshop Map: Governance & Innovation

A

WHY?

B C

D

WHO? WHERE?

WHAT?

E

WHICH?

F

HOW?

G

NEXT

According to system experts (governors, professors, economists, think-tanks, industry, etc.), if we change ‘the’ system, quantitative evidence shows:

System Integrity S

yste

m V

alu

e

+ ve, +ve

+ ve, -ve -ve, -ve

-ve, +ve

Linguistics Perspective: System Change

Quadrant One: Positive System Integrity & Positive System Value

Ha

rmo

ny

Divine

Gratitude Eternal Episodic

Civilizational Disruption:

Great Leap Forward

Global Exemplar

Appropriate

Democratic & Prosperous

Moral

Linguistics Perspective: System Change

Economic 6th Gear

Quadrant Three: Negative System Integrity & Negative System Value

Pan

ic

Apocalyptic

Tolerable Shame Eternal

Civil War

Economic

Collapse

Inaccessibility

Rising Cost

Staff Can’t Work =

Service Suffers

Favouritism

Linguistics Perspective: System Change

Linguistics Perspective: System Change

Linguistics Perspective

According to system experts (governors, professors, economists, think-tanks, industry, etc.):

1. Canadian Health System: “Crisis mode” for 50 + years

2. Sustainable and unsustainable: Proposed Remedies Lead to Paradise (Scandinavia) or Hell (United States)

3. We need “an adult conversation”

D

FOREIGN EXCHANGE

C

GLOBAL HEALTH SYSTEMS

E A

MILITARY SPENDING

B

ALL GOLD MINED TO DATE

OIL & ENERGY

Health Systems: An Industry Comparison (2010)

D: $6.1 T C: $7.2 T E: $2.1 T A: $2.7 T B: $9.1 T

FOREIGN EXCHANGE

GLOBAL HEALTH SYSTEMS

MILITARY SPENDING

ALL GOLD MINED TO 2010

OIL & ENERGY

Health Systems: An Industry Comparison (2010)

Governance

Health System Governance: • Misaligned functions • Differentiated provincially (BC vs. ON) • Disproportionately massive civil service

Health Organization Governance:

• Skilled in governance or management • Unskilled in industry operations • Short term can hinder effectiveness

Management

≈ Organization

Accountability

Governance

≈ System

Accountability

Stewardship

≈ Public

Accountability

Governance: System Hinge b/w Operators and Regulators

Governance in Context

1 Fiduciary Mode

Strategic Mode

Generative Mode

P People

2

3

Governance in Context

P

1 Fiduciary Mode

Strategic Mode

Generative Mode

P People

2

3

Governance in Context

1

1 Fiduciary Mode

• Financial Oversight

• Asset Oversight

• Performance Oversight

Governance in Context

2

2 Strategic Mode

• Decision Support

• Strategic Diligence

Governance in Context

3

3 Generative Mode

• Ambiguity

• Interpret Operating Environment

• Making Sense of Complexity

Governance in Context

1 Fiduciary Mode

Strategic Mode

Generative Mode

P People

2

3

Innovation

“The future’s already here, it’s just not evenly distributed.” William Gibson

T i m e

Adopti

on &

Matu

rity

Innovation: Lifecycle View

Innovation

Innovation Value Improvement*

* Sustainable and greater than the system’s “natural state” of evolution

Governance & Innovation

Intersection of Governance & Innovation

© MVC and Associates, 2005

value

Level of Governance

5 Organization sustainability, service to humanity

4 Business stewardship, public good

3 Strategic duty & viability

2 Enhancing operations

1 Statutory compliance

Level of Innovation & Risk

E Global business / societal innovation

D Global or industry innovation

C New business model innovation

B New product, service, or market innovation

A Process or program innovation

A B C D E

5

4

3

2

1

Innovation: Health-System Examples

A B C D E

5

4

3

2

1

Level Examples

A Fraser Health Authority, Peer Review Process for DI

B Spartan Bioscience, Ottawa: Point of Care DNA Testing

C Wound Care in Home Care and LTC

D The Narayana Hrudayalaya, Bangalore: Production Line Heart Surgery

E Diagnostic Related Groups (DRGs), ICD Codes

Exercise One: Innovation & Extinction Map

Innovation

Extinction

Present Future 2013 2015 2017 2020 2025

Exercise One: Innovation & Extinction Map Warm Up

Innovation

Extinction

Present Future 2013 2015 2017 2020 2025

Smart Dust

Coins & Paper

Money CDs / DVDs

Smart

Cosmetics

VR Enhancing

Drugs

Exercise One: Innovation & Extinction Map

Innovation

Extinction

Present Future 2013 2015 2017 2020 2025

Exercise Two: Parsing Innovation & Extinction: Mission-Aligned Processes

2013 2015 2017 2020 2025

Inn

ova

tio

n /

Ext

inct

ion

Typ

e

Inn

ova

tio

n Infrastructural

Administrative

Clinical

Exti

nct

ion

Clinical

Administrative

Infrastructural

Governance Roles for Innovation

Internal Hybrid External

Governance Enabled (Mandatory?) • Supports executive in

“generative mode” • Defining project

dissolution metrics

Collaborative Governance

• Collaboration between private enterprise and government organizations

Government • Externally appointed and

driven • ‘Remedies’ mechanism

for non-conformance

Governance Enabled & Financed • Governance team funded

(X-Prize concept) • Prizes for priority

innovations

Accreditation Organization

• Typically for A and B levels of governance

Institutionalized Function • Office of Innovation or

Knowledge Management • Chief Patient Experience

Officer, or Chief Innovation Officer

Governance Roles for Innovation: Internal

Internal Findings & Observations

Governance Enabled (Mandatory?) • Supports executive in “generative

mode” • Foresight development through

scenario planning, trend forecasting,

Governance Enabled: The message of this presentation: this is an undeveloped and critical board function for health-system innovation; therefore, the bare minimum

• Innovation priorities must address the organization’s or the system’s greatest needs

• Innovation must be developed and

demonstrated

• There’s no such thing as failure—it becomes an organizational lesson

• Implementation plan and dedicated teams strongly advocated (see The Other Side of Innovation for team design)

Governance Enabled & Financed • Governance team funded (X-Prize

concept) • Prizes for priority innovations

Institutionalized Function • Innovation Centre, Chief Patient

Experience Officer, or Chief Innovation Officer

• Saint Elizabeth Health Care • Cleveland Clinic

Governance Roles for Innovation: Collaborative

Hybrid Findings & Observations

Collaborative Governance • Collaboration between private

enterprise and government organizations

McGill University Health Centre Glen Campus, $1.3 Bn budget Fraser Health Authority, Surrey Critical Care Tower, $512 M budget Comcare Health Services (now Revera), DuET Program: Wound Care, $1.2 M investment

• Knowledge, resources, and skills arbitrage among private and public partners

• Needn’t involve major capital projects

• With IT: often a drastically more affordable alternative – Excel instead of ORACLE

• Requires high degree of project management or portfolio management expertise

• BAIL BUTTON: Preventing escalating commitment

• Suitable when the innovation’s implementation will create:

1. Better public outcomes 2. Creation of additional resources

Governance Roles for Innovation: External

External Findings & Observations

Government • Externally appointed and driven • ‘Remedies’ mechanism for non-

conformance (for HealthQualityOntario)

Diverse Opinions • Relevant for Level A and B governance:

statutory compliance and organizational improvement

• A redundant bottleneck

• A great addition to the system—system support for standardizing practices

• Where enforcement or ‘remedies’ capacity exists, general compliance, but also process gaming

Accreditation Organization • Organizational accreditation (Accreditation

Canada) • Clinical accreditation (Regulatory college)

Exercise Three: Which Role Suits the Innovation?

2013 2015 2017 2020 2025

Inn

ova

tio

n /

Ext

inct

ion

Typ

e

Inn

ova

tio

n Infrastructural

Administrative

Clinical

Exti

nct

ion

Clinical

Administrative

Infrastructural

Summary

A

WHY?

APPROPRIATE UNTAPPED RESOURCE

B C

D

WHO?

BOARD

WHERE?

GENERATIVE MODE

WHAT?

INNOVATION & EXTINCTION

MAP

E

F

HOW?

INTERNAL HYBRID

EXTERNAL

G

NEXT

EVALUATION CONSOLIDATION

FOLLOW UP

WHICH?

CLINICAL ADMINISTRATIVE INFRASTRUCTURE

Parting Thought – The ‘When’ of Innovation

“The key to long-term success is to make innovation happen continuously.”

Arkadi Kuhlman, CEO, ING Direct, “Reinventing Innovation,” Ivey Business Journal, April – May 2010

NHLC: Up Next

15:15 - 15:45

NETWORKING BREAK - EXHIBITS AND POSTER VIEWING - Room 100

15:45 - 16:45

PLENARY - Critical success factors - Unlocking the power of the Blue Ocean Strategy: Room 200

16:45 - 17:00

PLENARY - Closing remarks: Room 200

Consultations

Publications

• The Wide Lens, Ron Adner

• The Innovator’s Prescription, Clayton Christensen

• The Innovator’s DNA, Clayton Christenson

• Collaborative Governance, John Donahue & Richard Zeckhauser

• Wrong, David Freedman

• The Other Side of Innovation, Vijay Govindarajan and Chris Tremble

• Willful Blindness, Margaret Heffernan

• Complexity: A Guided Tour, Melanie Mitchell

• The High Performance Board, Dennis Pointer & James Orlikoff

• The Innovator’s Manifesto, Michael Raynor

• Start Up Nation, Dan Senor and Saul Singer

Consultations (Continued)

Publications and Organizational References

• George Cooper, “Good governance first step toward curing system ills,” The Halifax

Chronicle Herald, January 13, 2012 http://bit.ly/xaFjGC

• Chris Morris, “Production Line Heart Surgery,’ BBC, August 2, 2010: http://bbc.in/a4uC8a

• The World Bank, Public-Private Partnerships and Collaboration in the Health Sector: An Overview with Case Studies from Recent European Experience, Irina A. Nikolic and Harald Maikisch, October 2006

• Spartan Bioscience, referred to as new product innovation in appended presentation

One Rationale for Collaboration: Lifecycle View

T i m e

A d

o p

t i

o n

T i m e

A d

o p

t i

o n

Supplier Clinician Organization Regulator

One Rationale for Collaboration: Lifecycle View

T i m e

A d

o p

t i

o n

Supplier Clinician Organization Regulator

One Rationale for Collaboration: Lifecycle View

Better Public Outcomes?

+ Creation of

Additional Resources?

Proceed