The Power of Systemness: Adding Value to Healthcare

Consolidation is accelerating at a rapid pace in healthcare with mergers, acquisitions, and partnerships occurring daily. Is this consolidation creating value for the patient as well as the provider? Improved quality, reduced costs, increased margins, and the desired patient experience are all incentives for consolidation. But as organizations come together, are they executing their mission as integrated entities? Following systems theory, the value of a hospital or health system is more than the sum of its acute and outpatient care facilities, physician groups, and health plans. The parts must be dynamically interrelated and fully open to new synergies, each part readily adaptable and fully resilient. With strong leadership, culture, structure, and processes all in place, organizations can transfer energy to their interdependent parts and help them function in unity amid the disruption in today’s healthcare sector. As the articles and commentaries illustrate in this issue of Frontiers of Health Services Management, systems concepts can be successfully applied as a framework for an integrated entity. Ideally, systems concepts are driven by standardized, consistent practices and processes that, in turn, lead toward consumer-centric goals that are communicated throughout the hospital or health system. Systems concepts form the foundation for alignment of clinical, financial, and operational functions across the continuum of care, enterprise-wide. The benefits can be substantial. Fewer decision-making layers, reduced costs from centralized operations, less variation through evidenced-based practices, better-coordinated care with the elimination of duplicative services, and greater economies of scale are all important advantages that can be realized and applied in a well-developed system. Clearly defined and communicated mission, vision, values, and goals; physician–leadership alignment; a seamless flow of information and data; the continuous measurement of performance with accountability; and a sharp focus on the consumer throughout the enterprise are complex components in a working healthcare system. Consolidation does not automatically yield systemness. Systemness demands strategic planning and execution, which take time to develop. The risks are great, but the results can be powerful—fully leveraging current assets, providing new opportunities for growth and innovation, transforming care delivery and business models, and propelling an organization as a dynamic force in healthcare. The authors in this issue of Frontiers address this important topic in today’s healthcare environment by sharing their own experiences and expertise. Aimee Daily, PhD, FACHE, reviews the evolution to systemness at Memorial Health System in Illinois. With valuable perceptivity as chief transformation officer, she describes the fundamentals of organization affiliation and integration such as structural changes, strategy and governance, guiding principles, affiliation criteria, new functions and positions, and the importance of communication and education. Daily writes, “Systemness requires visionary and sure-handed leadership to identify and realize economies of scale, share best practices for operational improvements, and reduce unwanted variation to improve quality of care.” After facing numerous changes and challenges, Memorial Health System undertook a comprehensive organizational assessment and applied the lessons learned to forge a path through integration and alignment to become the market leader it is today. Former system executives Charles D. Stokes, FACHE, and Rod Brace, PhD, share guidance on how to create systemness, avoid barriers to achievement, instill high-reliability practices, establish a culture of interdependence, create clinical/medical staff collaboration, and recognize the imperative for change. The authors, now founding partners of Relia Healthcare Advisors, outline the essential components of an operating model for systemness. “Systemness not only holds the prospect of reorganizing healthcare’s collective approach to providing services but also provides a viable alternative for long-term survival,” Stokes and Brace assert. In his commentary, executive consultant David A. Rubenstein, FACHE, focuses on how leaders can move a system from theory to reality. As retired Commanding General of the US Army Medical Department Center and School and Chief in the US Army Medical Service Corps, Rubenstein is well versed in leadership skills, systemness criteria, and measures of success. He shares insightful examples of leading healthcare organizations’ journeys to systemness. “A system that is attentive to both its whole and its parts can provide improved efficiencies; quality of care; and patient, family, and staff satisfaction,” Rubenstein submits. “With every stakeholder interaction (internal and external), every opportunity must be taken to highlight the system’s reasons for existence and why it’s important to be a system.” Commentator Kira M. Carter-Robertson, FACHE, provides an overview of systemness and discusses the necessary foundational structure, barriers to success, and evolutionary process at Sparrow Health System in Michigan. She poses important questions to be answered during the systemness journey, such as “How can the interconnectedness of elements in healthcare expand access, improve outcomes, drive out inefficiencies, and create care environments that bring value to the communities we serve?” She provides answers drawn from her own experience as Sparrow’s senior vice president of affiliate operations and concludes, “Working toward perfect systemness is hard work that is never really finished . . . but we are on our way to becoming a truly integrated delivery system.” In her commentary, Abi Sriharan, DPhil, director of the Master’s in Systems Leadership and Innovation Program of the Institute of Health Policy, Management, and Evaluation at the University of Toronto, Ontario, Canada, differentiates systems leadership skills from traditional leadership competencies. She outlines the five tenets of systems transformation in her ADAPT framework: agility, deep learning, appreciative dialogue, people, and team. As she explains, each tenet is necessary to transform single entities into a system. “Systems leadership is different from task-focused leadership because it is centered on leadership behaviors that help navigate complex transformations with ambiguous outcomes and long timespans. It also calls for a unique set of competencies to inspire and facilitate collective action that can support the transformation process,” Sriharan writes.

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