Recently in Leadership in a Recession (Series) Category

The July-August issue of Harvard Business Review is far from light holiday reading. Through a wide range of lenses, it aims squarely at business strategy and leadership challenges to be faced in the post-2009 recession world. Leadership in a (Permanent) Crisis by Ronald Heifetz and his colleagues at Cambridge Leadership Associates, reflecting the volume as a whole, is all about national and global post recession trends in the broader business environment that will shape industries over the next several years. As physician and health care leaders we owe it to ourselves, our patients, and our organizations to examine how these will impact us...

The source for When Leaders "Waffle," Confidence Plummets is a little off the beaten path for this space, but Dr. Joseph Simone, one of my fellow Health Care Leadership Blog core contributors identified it and it's a great pick. Joe didn't have time to write - but had an itch about this piece and sent it along to me. So without having discussed it with him, I will take a stab at scratching for him...

If You Think Worst Is Over, Take Benjamin Graham's Advice, the offering in Jason Zweig's Intelligent Investor column in The Wall Street Journal print edition of May 23, provides some thoughtful guidelines to managing an investment portfolio in uncertain times. Interestingly, and perhaps inadvertently, the same guidelines hold for managing a leadership portfolio in all times. And truthfully, what times aren't uncertain? In today's economic upheaval we are simply more aware of the same uncertainty that exists in "good times." So read this with an expansive mind, with an eye to leading health care organizations today....and tomorrow...

On April 27, The Economist (web version) published a brief piece titled Entrepreneurship in its regular "Idea" column in which it briefly defines and characterizes entrepreneurship - well done, but no biggie. More interesting was a reminder that one aspect of entrepreneurship is "intrapraneurship" - defined as "the introduction and implementation of a significant innovation for the firm by one or more employees working within an established organisation". I thought it was timely for health care and physician leaders to examine this a bit further so I surfed around, connected a few dots from my own consulting experience, and learned a few things worth sharing here...

Splitting hairs? Not really. Read Hanging Tough in the April 20 print issue of The New Yorker (while not really business press it is the press commenting on business). This piece by James Surowiecki examines the nuances of leadership decision making in both risky and uncertain times. While covering some of the same territory as R&D Spending Holds Steady in Slump, April 6 Wall Street Journal - and the subject of this blog's April 8 commentary Health Care Leaders Should Preserve R&D Spending in Down Times - Surowiecki focuses squarely on characterizing the strategic investment dilemma currently faced by senior health care leaders...

An academic medical center client recently asked me to advise on developing a Departmental and programmatic strategic plan. My first reaction was OK, nothing new, let's go. But I soon found myself pausing to have a discussion about what that should look like this year in light of the economy and it turns out that our conversation pretty closely tracked: Strategic planning: Three tips for 2009, published in the April 2009 McKinsey Quarterly. You can register on the McKinsey site for free and view this article as well as a post-publication survey of readers here. While health care leaders (and followers) tend to glaze over when forced to think about strategic planning, the nuances discussed by these authors bear consideration...

One of the opportunities in a down economy - if you are not too down yourself of course - is the potential to pick up some bargains. Which is not without its rewards - and its hazards. The April 3 issue of Business Week features How to Make Acquisitions in a Down Economy as the cover article in the Small Biz section. In this article, Amy S. Choi passes on some wisdom and experience which can be useful to health care leaders as they consider purchases - be they physician practice acquisitions, hospital or clinic takeovers, or purchases of health care related businesses...

The April 13 Wall Street Journal exploded with news about the impact of the economy on jobs which for the first time included bad news about health care. Major articles on health care job losses and adverse nursing employment trends provide concrete reasons for health care leaders to seriously consider contingency strategies for downsizing should these trends expand. Today's Journal contained a discussion of personnel reduction strategies in industry. Weighing Furlough vs. Layoff, by Cari Tuna, addresses one aspect of the problem that is worth a read by health care leaders...

R&D Spending Holds Steady in Slump, appearing in the April 6 Wall Street Journal, chronicles the benefits of continued corporate investment in research and development during down economic cycles. In this page one article, authors Justin Scheck and Paul Glader observe that: "Big R&D spenders say they've learned from past downturns that they must invest through tough times if they hope to compete when the economy improves." This may hold a lesson for health care leaders.

Mssrs. Scheck and Glader report on the difference between companies that maintained R&D spending in poor economic times and harvested substantial returns from new products and technologies (Apple's investement between 1999 and 2002 resulted in the launch of its iPOD) and those that cut back in those periods and subsequently lost market share or competitive edge (General Electric and Motorola in the same period). I suspect these lessons, and others from the corporate experience that are cited by the authors, likely apply to health care products and devices as well. We just don't usually think of health care providers and payors as major investors in R&D. Think again. We do invest, albeit differently. Our investments in new medical technology, infrastructure, personnel, and training may not be research but they certainly qualify as product development and innovation in the programs and services that are the core of our businesses.

So the lesson for health care leaders is that when under pressure to cut "unnecessary cost," continued improvement of quality, safety, IT, and customer service - investments crucial to our reputation and therefore our revenue base - should be last rather than first on the cutting block. Perhaps it even makes sense to increase these investments in pursuit of competitive advantage at a time when others are reticent to invest.

Left untended and stagnant in a shifting and highly competitive environment, health care delivery organizations are at risk of losing advantage. And as an industry that must regularly adopt new scientific and technologic innovations, we must continually reinvent our ability, our systems, and our people to receive and effectively implement the fruits of innovation efforts in other health related industries. Which qualifies us as investors in R&D in my book.

The April 7 Wall Street Journal contained several useful articles on investing and managing in the current bear market. Perhaps I was jaded because I was on a plane all day, but I found the whole edition to be interesting. I picked Avoiding Bear Traps by Suzanne McGee to comment on. This feature piece was ostensibly about pitfalls to be avoided when investing after having sustained great losses. And it's worth a read for that reason alone - unless you managed to avoid the 30-40% losses the rest of us suffered in the late 08-early 09 market. But the same framework of pitfalls can be in considering a variety of risk-return scenarios related to decisions made regularly by clinical and executive health care leaders. So read the article and consider this examination of Ms. McGee's six traps in our context...