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Oakwood healthcare customer profile

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  • 1. Oakwood HealthcareSystemIndustry: HealthcareWebsite: www.oakwood.orgCUSTOMER OVERVIEWOakwood Healthcare System, a regional health carenetwork, is one of the most comprehensive health caredelivery systems in southeastern Michigan. The Oakwoodsystem serves over 1 million people in 35 communities overa 500-square-mile area and operates four acute carehospitals, several health centers, and offers a vast number ofspecialty services including four centers of excellence. Morethan 1,300 physicians representing nearly every medical andsurgical specialty and subspecialty are affiliated with OHS.Customer PROFILEDearborn, MI“We selected ActiveStrategy because wefelt that they had a unique combination ofsoftware that supports our managementframework plus a true understanding ofhow to apply performance excellencemethodologies. I believe they will bean important partner with us in ourongoing performance journey,” - Corporate Director,Annette ZwernerIn 2007, Oakwood—like organizations across all industries—found itself mired in very difficult economic conditions. Buthospitals in the Detroit area were in an especially toughsituation since it was among the hardest-hit cities in thecountry. Its unemployment rate had risen—and stayed—above 14%. This meant that the region’s hospitals wereseeing an ever-increasing number of uninsured patients. Infact, Oakwood’s rate of uncompensated care was now twicewhat it had been five years earlier. To compound theproblem, those patients who still had insurance werepostponing non-urgent and elective procedures, drivingdown profits significantly. A 2008 study found thathealthcare systems across the Detroit region in aggregatelost $77.4 million and had an average operating margin ofminus 0.8%. The Oakwood team quickly realized that theyneeded to develop and adhere to a new strategy to deal withthese unfortunate truths.When trouble struck, Oakwood was already a high-performing organization. In fact, they were a 2007 recipientof the Michigan Quality Leadership Award and had beennamed six times to the list of Top 100 Integrated HealthcareNetworks. However, Oakwood had what is a very typicaldisconnect between their strategic plan and theirperformance measures, which limited their ability to quicklyaddress the economic crisis. At the time, senior leadersPlymouth Meeting, PA | San Francisco, CA | info@activestrategy.comw w w . a c t i v e s t r a t e g y . c o mBACKGROUNDreviewed a handful of metrics that were not connected tothe strategic plan in any obvious way. Nor was there anyregular review process for the metrics. In addition, theyhad to be manually pulled from a multitude ofspreadsheets that were housed within organizationalsilos.The leadership team decided that it needed to get abetter handle on critical business metrics as a first stepto address the challenging business climate. To do so,they formed an Informatics Group to be led by CorporateDirector Annette Zwerner, who was charged withdeveloping a holistic view of performance across theregional healthcare system.TAKING THE NEXT STEPTo help inform their decisions on how to proceed,representatives from the new Informatics Group attendedthe Institute for Healthcare Improvement National Forumin late 2007. This annual event brings together some ofthe nation’s best-respected healthcare leaders andthinkers to discuss ideas to improve quality and
  • 2. Customer PROFILEPlymouth Meeting, PA | San Francisco, CA | info@activestrategy.comw w w . a c t i v e s t r a t e g y . c o mSTRATEGYoutcomes in healthcare. While there, the Oakwood team metwith a variety of vendors from the performance managementand measurement field. Standing out among these wasActiveStrategy, an organization that provides performanceexcellence consulting and performance managementsoftware. The Oakwood team left wanting to learn moreabout how ActiveStrategy solutions could help Oakwoodalign the organization to their strategic priorities, provide acommon view of key metrics and initiatives, driveaccountability across organizational silos, and establish aconsistent review process to identify areas for improvement.The initial meeting at the conference led to two others withActiveStrategy, after which executives at Oakwooddetermined that the combination of their expert consultingservices and their powerful and mature performancemanagement software made them the right company to helpOakwood take control of their organizational performance.IMPLEMENTATIONIn light of the harsh economic situation, Oakwood hadredefined its strategic priorities, focusing on operationalexcellence and areas that would drive profitable growth evenduring tough economic times. To help align the organizationto these priorities and begin to execute the strategy,Oakwood engaged ActiveStrategy’s strategic consultingteam in 2008 to help identify the right top-level performancemeasures and strategic initiatives, as well as to ensureorganizational readiness for building scorecards.Once these foundational steps had been completed, newlyaligned scorecards were developed and deployed inActiveStrategy Enterprise (ASE) software, beginning withthe Board of Trustees Scorecard in the first quarter of 2009,followed by an Executive Council Scorecard in the secondquarter. In the third quarter, Scorecards were implementedfor the Operations Council, as well as for directors of keyfocus areas in the organization.In the fourth quarter, Oakwood began developing andimplementing 90-day action plans within ASE. Thesefocused improvement efforts were designed to clusteremployee efforts around specific performance gaps thatwere now very apparent on the Oakwood scorecards (thosemeasures whose stoplight indicators were either red oryellow, indicating performance was below targets). Bymanaging these improvement initiatives within the samesystem as the scorecards and performance measures,the teams were able to drive cross-silo accountability forachieving budget and timing milestones, to quickly see if theprojects were having the desired impact on the correlatedmeasures, and to make changes to the action plans asneeded.KEY RESULTS• Scorecards are currently cascaded four-levels deep intothe organization, driving alignment from the Board throughto Director-level contributors to the strategically-importantissues, such as profitable growth• Measures that had previously been disconnected from thestrategy and stored in disparate systems are now selectedbased on the strategic plan of the organization and housedin ASE where all contributors may access them• Oakwood leaders may now drill down into measures inASE to see additional detail at each level, historical trends,information about who owns the measure, as well as alignedimprovement activities, including the 90-day Action PlansWhile ASE was initially used primarily by Senior Leadership,the use of the system is expanding, driving ever greateralignment and collaboration. Oakwood currently has 200active ASE users and will expand to 300 by the end of 2010.Example of a Scorecard in ASEExample of a Briefing Book in ASE