Managing Innovation at St. Lukes Medical Center - Essay Example

MG:8653 Managing Innovation November 19, 2009 Managing Innovation at St. Luke’s Medical Center Introduction Every organization exists to achieve a purpose. In order to attain organizational goals, a set of policies and strategies are defined and developed by management. As averred by Christensen, Andrews, & Bower (3), policy is “the study of the functions and responsibilities of senior management, the crucial problems that affect success in the total enterprise, and the decisions that determine the direction of the organization and shape its function”. One of the strategic management decisions undertaken by aggressive and competitive organizations is innovation. Most business practitioners have grown accustomed to innovation stemming from new inventions and advancing technology. But suiting policy to changing circumstances includes also the application of a firm’s long-established strengths to unexplored segments of the market via innovations in price, service, distribution, or merchandising. Innovation is the “process by which an idea or invention is translated into a good or service for which people will pay. In business, innovation results often from the application of a scientific or technical idea in decreasing the gap between the needs or expectations of the customers and the performance of a firms products.” (Business Dictionary 1) One of the most innovative organizations in Asia is St. Luke’s Medical Center in the Philippines. It is the number one hospital in the Philippines but its vision is to be one of the top five medical institutions in Asia by 2010. The mission of St. Luke’s Medical Center is to improve the delivery of quality health care conforming to the strict standards of the Joint Accreditation Commission of Health Organizations (JACHO). In this regard, management is devising strategies to make innovations on its administrative structure as well as diversify its operations in a new and larger location to expand its clientele. In this regard, this essay is written to proffer several innovative options to compete not only in the local market but in the Asian market, as well, to enable St. Luke’s to achieve its vision and mission on its specifically defined time frame. Industry Overview According to an article published by DLSU – Manila, the thrust of the health care industry in the Philippines is to position itself as a medical tourism site inviting guests and patients from other neighboring countries to avail of the best health care service Philippine medical institutions accord. As such, the article averred that “the Philippines is positioning itself as a medical tourism site where people from developed nations can go to avail of high quality medical and health care services. The emerging Philippine medical tourism industry is projected to be successful considering the length of medical education of local physicians, the fluency in the English language of majority of the personnel, the state-of-the-art health care facilities, and the wide array of diverse and exotic travel and recreational destinations.” (DLSU – Manila, 1) Company Background St. Lukes Medical Center (SLMC) is located in the Philippines and has provided high-quality healthcare for over a century. Founded in 1903, its mission is to provide outstanding out-patient care. Today it is the foremost and most admired hospital in the Philippines and an acknowledged leader in Asia. (SLMC About Us par. 1) The following excerpts detail the company’s relevant information which makes it one of the top health care institutions in the country and in Asia: ”St. Lukes delivers on its mission of healing by gathering under one roof the finest medical expertise, the most sophisticated medical technology and facilities, and a deep-rooted culture of compassion. It supports this mission with research and continuing education for those who serve. The total dedication to quality and caring of the St. Lukes family is what distinguishes the hospital as a center of healthcare excellence in Asia. The 650-bed hospital is home to nine Institutes, 13 Departments, and 19 centers. These centers of excellence bring to the Philippines the latest medical advances and treatment modalities. Over 1,700 hospital-affiliated medical consultants see out-patients in more than 450 private clinics. SLMC is the undisputed leader in virtually all medical specialties, including cardiovascular medicine, neurology and neurosurgery, cancer, ophthalmology, and digestive and liver diseases. It is the first choice of medical and health-related practitioners and patients for executive check-ups. SLMC receives patients from around Asia, Micronesia, the Middle East, Europe and the United States. With its rich legacy of excellence and with plans in place to build a second new and modern facility at the Fort Bonifacio Global City, SLMC is in a position to realize a bolder vision of the institution as one of the top five hospitals in Asia by 2010.” Leadership Established in 1975 as an important part of the reorganization of St. Lukes into a non-stock not-for-profit charitable corporation, the board provides overall leadership and direction for the organization. It is responsible for all professional and policy issues that arise in the course of managing the hospital. Members of the board are nominated and chosen on the basis of what they can contribute in terms of resources, talent or wisdom. They are all volunteers who do not receive nor seek remuneration, perks, or privilege. Since 2005, a Board of Advisers composed of some of the best and brightest in the world of business and medicine in the United States and in the Philippines has provided counsel and guidance to the Board of Trustees. (SLMC Leadership par.1) The hospital is being managed by the President and Chief Executive Officer, Mr. Jose F.G. Ledesma, who has taken the helm since 1986, when he was initially appointed as Executive Director. He became the chief honcho ten years after and have since then, steered the institution in the course that spells excellence in the delivery of health care. Vision, Mission and Values According to the Official Website of SLMC ( pars. 1 & 2), the vision and mission of the hospital are indicated as follows: “VISION: St. Lukes Medical Center will be one of the Top 5 medical institutions in Asia by Year 2010. MISSION: To deliver excellent healthcare through caring and highly competent professionals, utilizing world-class technology and research. This we shall do in the most financially viable way without losing sight of our primary purpose - to be of service to God and mankind.” Further, SLMC adheres to six corporate values which they consistently uphold: (1) social responsibility; (2) passion for excellence; (3) innovation; (4) customer focus; (5) expertise; and (6) teamwork. By social responsibility, SLMC acknowledges the importance of social service, community health and environmental safety. Their passion for excellence is exemplified in all services rendered to the customers conforming to the standards required by the Joint Commission International and with the efforts focused on achieving their mission and vision of being one to the top 5 medical institutions in Asia by the year 2010. The value of innovation is management’s drive and commitment to discover new ways to deliver efficient and effective health care. This is done by encouraging new ideas in every aspect of patient care. Customer focus is addressed by giving priority to patient care. Regular feedback is solicited by SLMC from customers through customer satisfaction surveys which would solicit response to the delivery of health care. The Customer Services Department is always ready to assist customers in times of complaints or concerns which need to be immediately resolved. To sustain leadership in the delivery of healthcare, SLMC is aware that each and every personnel, medical staff, administrative team and management, exercise expertise and professionalism in the execution of their responsibilities. Finally, by working as a team, SLMC cares and treats each and every individual with respect. They encourage open communication to ensure active participation and immediate response in areas which require decision and appropriate action. The mission of St. Luke’s Medical Center is to improve the delivery of quality health care conforming to the strict standards of the Joint Commission International (JCI). St. Lukes is the first and only hospital in the Philippines and the second in Asia to get accreditation in 2003. (SLMC 2009) SWOT Analysis SLMC’s ultimate existence for over a century is already a milestone in itself. No other health institution has survived the test of time. One would truly appreciate the factors that assisted the hospital in its evolution from being a free dispensary clinic in 1903 up to having an in-patient capacity of 650 beds today. The strengths, weaknesses, opportunities and threats are hereby presented as follows: Strengths SLMC boasts of their in patient and outpatient facilities which are both up to date and of state of the art technological features. The administrative and medical team is highly professional and competent in their respective fields. They currently have seven critical care units and ten special nursing units which operate according to international standards. As mentioned, SLMC is the first hospital to be accredited with Joint Commission International (JCI). JCI is the international arm of Joint Commission on Accreditation of Healthcare Organizations (JCAHO), the world’s most prestigious accreditation body. St. Lukes has also achieved international ISO 9001 Certification for the Institute of Radiology. (SLMC 2009). It also boasts of a roster of recognition and awards from local and international governing bodies ranging from Financial Management Award, 3-star Child Labor and Child-Friendly recognition, Hall of Fame Award for Excellence in Radiation Services, Clean Air Act Award, Asian Hospital Management Awards winner in two categories and four runner-up entries in three other categories, among others. (ibid.) In addition, SLMC recognized the value of research by supporting the advancement of medical science through interdisciplinary partnerships between scientists and physicians in the conduct of high quality biomedical research. (SLMC 2009) Weaknesses SLMC is considered a high quality- high priced health care institution. Therefore, most of its clientele are from the class A of the population or those from the high income level. As such, the middle class cannot afford to avail of their services. Opportunities With the current plans of opening a new site at Fort Bonifacio Global City, SLMC would be catering to a new market niche and thereby would have opportunities of further increasing its market share. Threats With the successful strategies employed by SLMC in the delivery of health care, other competitive health institutions follow their lead. The competitive threats facing SLMC come from Makati Medical Center and Medical City. These two hospitals are also undergoing extensive development and are both striving to conform to the international standards of JCI. Of course, these hospitals remain threats in terms of diminishing the market share of SLMC in the high quality – high priced market niche. Innovation Strategies 1. Administrative Innovation: Employment of Non-Nurse Managers Every nursing unit in the hospital is headed by a nurse manager who is assigned as the chief head nurse on duty. Her job responsibilities entail patient care as the primary task and managerial functions such as planning, directing, staffing and control. These multi-task functions coupled with low pay contributed to low morale and low productivity. These nurses opted to gain the minimum experience required to enable them to leave the country and work abroad. The leadership function assigned to nurse managers conflict with their functions as providers of patient care. They are expected to deliver timely reports on a daily, weekly and monthly basis. They monitor staffing requirements. They prepare the time sheets for payroll purposes. And most importantly, they are expected to know all the nursing intervention requirements for all the patients are their nursing units. There is this question on prioritization of function. As nurses, of course, they should prioritize patient care. But as managers, the function of attending to the human resource needs of the unit suffers. Reports are not completed on their specified time schedules. Upkeep of facilities in patients’ rooms and hospital areas are not regularly attended to. Equipments that need repair and reorder are forgotten. Staff vacation leaves are not properly plotted and thereby not taken as scheduled. Performance evaluation and appraisals are not conducted regularly for monitoring purposes. All of these functions are important managerial functions which would create an improvement in productivity and morale of a hospital unit. All of these should be attended to ensure customer satisfaction and efficient delivery of health service. What were the alternative courses of action open to management to solve this problem? The officers and top management of this hospital were aware that there were several options open to them, among which are: 1. Separate the patient care and managerial function from the nurse managers. 2. Hire administrative managers to take care of the managerial functions. The officers, members of the board of directors, and the CEO of the hospital deemed it appropriate to hire non nurse unit managers who possess graduate degrees in business, to head the different nursing units. These unit managers have the sole responsibilities of ensuring compliance to reportorial requirements, human resources issues, facilities and equipment, budgeting, and other aspects of the units’ operations – except patient care. This solution was first met with complaints especially from the nurse managers who perceived the new position as a threat to their existence. They feared that they would eventually lose their “managerial” position and revert to a “staff” position since they would be relieved of the managerial functions and concentrate on patient care. However, top management assured them that this strategic move would enable them to focus on their primary concern as nurses and at the same time, take additional training courses to improve their nursing skills. Management developed another career path open to them which would eventually make them capable of becoming department managers and maybe, eventually, vice presidents for nursing. This move paved the way to increase morale and productivity in the units, and increased patients’ satisfaction with regard to the delivery of efficient and effective healthcare. 2. Structure Innovation: St. Luke’s Bonifacio Global City Medical Arts Building St. Luke’s is currently building a two-tower structure which stands on a 1.6-hectare property in Taguig City, just beside the outskirts of one of the premier commercial districts in Makati. As described in their official website, “Tower 1 is a 13-storey, 600-bed hospital building while Tower 2 is the 11-storey Medical Arts Building (MAB) that houses 374 doctors’ clinics ranging in size from 27 sq.m. to 53 sq.m. The new state-of-the-art healthcare facility will feature a ground floor hotel-like lobby, six passenger elevators and five service elevators, ground floor out-patient operating rooms, fully air-conditioned hallways and corridors, waiting lounges on each floor, a doctors’ lounge on the 2nd floor with a restaurant that is open to the public, and a bridgeway connecting to the Main Hospital.” (SLMC News, Events & Publication, par. 6) 3. Medical Breakthroughs: “Firsts in the Philippines” St. Luke’s Medical Center made a lot of “firsts” in the history of Philippine medical institutions by investing in medical machineries and equipment that would provided excellent patient care not only to the local population but to another visiting international patients, to wit: “St. Luke’s is the only medical facility in the country equipped with a PET/CT Scanner and Cyclotron. It was the first medical center in Southeast Asia to acquire a PET Scanner. St. Luke’s is the country’s first and only hospital equipped with a 3-Tesla MRI, which is far more advanced than the conventional MRI. It was the first medical center in the country to acquire the Cardiac Cathlab System with a flat panel detector. Its combined Gamma Camera SPECT/CT machine is the first and only one in the Philippines. Its Heart Rate Variability (HRV) facility is the first of its kind in the country. St. Luke’s had the first operational 64-slice CT scanner in the Philippines. St. Luke’s was also the first medical facility in the country to offer intravascular ultrasound (IVUS). It now has the first and only second-generation IVUS (Virtual Histology) in the Philippines.” (SLMC News, Events & Publications, par. 2) By taking a stance in being abreast in the most advanced medical equipment needed for the diagnosis of various illnesses, SLMC was able to cater to more patients not only in the local market but in the neighboring Asian nations. Further, this strategy puts SLMC in the top spot among the medical institutions in the Philippines. Management has made a commitment to invest in technologically advanced medical equipments to compete with other top health institutions in other countries in Asia. Most of its patients come in from abroad to avail of health services due to the following reasons: (1) compared to health costs in their respective countries, the costs for medical procedures and professional fees are more competitive and reasonably priced; (2) the health care practitioners are very accommodating, courteous and highly educated being regularly trained on the most advanced developments in all aspects of patient care; (3) guests from other countries who avail of health care from SLMC are served from the airport to the hospital and back; and (4) the advanced medical equipments enable medical professionals to diagnose and address the patients’ illnesses at the most effective and efficient manner, tantamount to substantial savings on health costs on the patients’ part. 4. Research and Development: New Thrusts and International Linkages SLMC “plans to engage in research using new technologies like microarray, stem cell, and proteomics which are currently underway. Bioinformatics, a highly interactive interdisciplinary science, is another field that will be pursued.” (SLMC Research & Biotechnology, par. 10) Their quests for advances in these fields are made possible with constant active scientific exchanges with foreign medical and research institutions abroad. This paved the way for discovery of cures for illnesses and in significantly improving the health conditions of patients here and abroad. As such, this innovative strategy makes SLMC closer to achievement of their vision. Competition From among the medical institutions according patient care with the same caliber as SLMC, there are three named contenders: Makati Medical Center, Medical City, and Asian Hospital. These are all private hospitals catering to the high income group. The husband of the president of the Philippines have regular check ups at SLMC. The president of the Philippines goes to Asian hospital for annual check-ups. The ex-president of the Philippines, Corazon Aquino, who recently succumbed to cancer died at the Makati Medical Center. However, despite the close competition among these hospitals, SLMC proves to top the list due to its provision of excellent quality health care complying with the strict standards of JCAHO consistently since it was first accredited in 2003. Their International Patient Care Center accords guests with a one stop service providing the following: airport meeting and travel service, interpreter and secretarial service, and concierge service (for tours, foreign currency exchange, and other requested services), among others. Analyses: SLMC’s Innovative Strategies to Win With the foregoing, it is eminent that SLMC is indeed one of the world’s best in terms of the delivery of efficient health care. This institution possesses all the necessary factors which make them stand out in the field of health care. First and foremost, the institution is lead by a highly qualified and professional team which emphasized six corporate values including teamwork. They recognize the importance of social responsibility, customer focus, passion for excellence, innovation and expertise in their respective fields of endeavor. Management was competently able to integrate tasks, structure, technology, resources, and people into a productive configuration. Secondly, their state of the art technology makes them better equipped than any other medical institution in the Philippines. Known for its aggressive acquisition of top-of-the-line equipment, St. Luke’s is better equipped than 95% of hospitals in the United States. St. Luke’s continuously acquires the latest technologies to enhance its capabilities and deliver superior results in pursuit of its mission of healing. (SLMC 2009) Third, their partnership with scientists and physicians through their Research and Biotechnology Division enables them to be a catalyst in the advancement of medical science. In fact, “the wealth of scientific data generated and the development of several Molecular Diagnostic Tests attest to the rapid progress of RBD. It has earned for St. Luke’s a reputation of being an institution of many first’s and only’s in the biomedical science field in the Philippines. Its impact is not limited to elite scientific circles but reaches beyond into the clinics and wards where its results redound to improved health care.” (ibid.) Fourth, their sensitivity to the needs of the organization in terms of strategic decisions that require change in the administrative aspect of health care enabled SLMC to improve the morale of the nursing units. It is through the first hand experience and direct governance of the Chief Executive Officer who made strategic decisions immediately possible. SLMC is one of the organizations which exemplify adherence to the highest standards for the delivery of health care. Their clear and concise statements for vision and mission utilizing corporate values provide the direction for the achievement of their goals. They retain and recruit only the most qualified and competent personnel to compose their human resources to ensure the most efficient delivery of patient care. In fact, as evident from their official website, SLMC details the following physicals and health professionals in the field: “Today, St. Luke’s Medical Center has over 1,500 medical consultants, 230 medical residents and 123 fellows on its roster, apart from interns from its College of Medicine. There are 644 nurses and 2,000 other paramedical, administrative and support staff. Over 4,000 professionals in medicine and its allied fields, as well as business management and hospital support staff, are the crown jewels of St. Luke’s. Their collective expertise and dynamic synergy provide a roster of local and international patients with health care skills and optimum technology.” (SLMC 2009) They invest the proper resources to ensure that they possess the most comprehensive range of the latest and most sophisticated technologies for diagnosing and treating diseases from the simplest to the most complex. Furthermore, there exists active scientific exchanges with foreign medical and research institutions which have helped expand both clinical and basic research orientations at St. Luke’s. Conclusion In creating an environment for performance, organizations must continuously innovate to survive and to lead as well. Innovation deals with searching for creative solutions to human relationships, structures and processes, and ability to assess and adjust to the changing environment. As presented in the resources, assets, structures and processes, as well as the leadership of St. Luke’s Medical Center, it can be deduced that it takes an effective collaboration of all factors to ensure the success of an organization in the achievement of their well defined goals. When the leaders, systems, and strategies are truly effective, the institution is transformed. Work becomes exciting and fun. Learning and competence are highly valued. Leaders lead by example and the values they hold are seen in their actions. The values are lived by leaders in the ordinary day-to-day interactions with the followers. There is a shared vision. This vision is to the best in their field. With all the innovative strategies being continuously employed by St. Luke’s Medical Center, it future appears bright and optimistic. Their vision of being included among the top five medical institutions in Asia by 2010 would very soon culminate to reality. Works Cited Business Dictionary. Definition of Innovation. 2009. Web. 18 Nov. 2009. Christensen, C.Roland, Andrews, Kenneth R. & Bower, Joseph L. Business Policy: Texts and cases. Richard D. Irwin, Inc. Homewood, Illinois. 1978. Print. DLSU – Manila. Health. 2009. Web. 18 Nov. 2009. St. Luke’s Medical Center. One of the World’s Best. 2009. Web. 18 Nov. 2009 from The Joint Commission 2008 Requirements Related to the Provision of Culturally and Linguistically Appropriate Health Care, April 2008, retrieved on April 21, 2009 from http://www.jointcommission.org/NR/rdonlyres/6941959E-D4BE-48D7-A2F8-A4834E84B263/0/JC_Standards_D... · Cached page · PDF file Read More