| View this email online if it doesn't display correctly |
|
|
|
| |
Dear Friend,
Change.
We’re living in a time of fast-paced change. Sure. But, I think people have been saying that since the Enlightenment. Maybe it’s the one thing that’s remained constant. But maybe it’s not. Some things have certainly remained the same.
For example, more than seven years ago, in my blog post entitled Who’s Driving Your Practice’s Bus?, published in April 2012, I wrote that for many medical practices, it appears as if no one is driving the bus; that is, no one is in charge of the group’s business. Instead, the practice operates like a runaway bus — yes, the providers are seeing patients, but where is it headed? Instead of a map with a clearly marked final destination, it’s just rolling along.
Many groups have a related problem: There isn’t a bus driver, there’s a whole committee of them. In fact, for some groups, there is a whole Greyhound bus full of them.
There is no question that the healthcare market is changing rapidly. This means that groups must have the ability to make business decisions rapidly.
Drawing on the work of the late Col. John Boyd, considered by many to be the second greatest military strategist to have lived, success requires a faster cycling through what he termed the OODA loop. In simplified form, the loop consists of observing, orienting, deciding and acting. (The OODA loop is actually much more complex with various internal feedback mechanisms). The point, however, is that the competitor who can cycle faster through the loop gains a tremendous strategic advantage over its opponent.
Whether you take the time to study Boyd or not, it’s axiomatic that a group must be able to make decisions quickly. That requires that someone, not some committee, be in charge.
Note that I’m not saying that groups need dictators: far from it. However, group leaders must be empowered to lead – and they must actually lead.
|
| | Tuesday - Success in Motion Video: Why You Need to Be Inside Your Opponent’s OODA Loop
Watch Tuesday's video here, or just keep reading below for a revised transcript: |
| | I want to talk with you about the OODA loop, and how you can use it to deploy your strategy, especially your negotiating strategy.
First, some background. Col. John Boyd was a famous fighter pilot, known for his ability to very quickly figure out his position within a dog fight and then get behind his opponent to shoot him down.
Over time, Boyd realized that the strategy that he developed for plane to plane combat was translatable, in a larger sense, to military strategy in general. His career advanced and he became a strategist at the Pentagon.
Some claim that Boyd was the second greatest military strategist ever to have lived, eclipsed only by Sun Tzu, the author of the book, The Art of War.
Boyd is most known for what he called the “OODA loop,” OODA standing for Observe, Orient, Decide and Act. It's easy to see how this works in the context of Boyd as a fighter pilot, which was to observe what the enemy was doing, to then orient himself to it (What was his position? What was the enemy's position?), to decide what he was going to do, and then to act.
Note that “act” doesn't necessarily mean to act affirmatively, it could mean to act in the sense of a conscious decision not to yet take action.
The object is to gain the ability to quickly cycle through the OODA loop, to be faster than your opponent at observing, orienting, deciding and acting. Boyd called that "getting inside" your opponent's OODA loop.
How's this work in connection with health care negotiation? Let’s say we're talking about an exclusive contract between a radiology group and a hospital system. The hospital says, here's our draft, get back to us in 30 days.
How are you going to use those 30 days? How are you going to observe and orient yourself to the way that hospital is acting, whether seen or unseen? Based on that, what decisions must be made? Once you've made them, how are you going to act?
In the context of that radiology contract, are you simply going to say, “well, here's our revised draft, what do you think?” Or will you first deploy a laid-out strategy based on your use of the OODA loop? Will you make additional comments, filter what their reactions are, make additional decisions, and then act, at some point the action being some type of formal response?
It's the quick and continuous deployment of the strategy, the fast cycling through the OODA loop that makes the difference.
Many medical groups tend to think that the way to negotiate is simply to get a copy of an agreement, look at it, make some notes, send it back and wait for the hospital's legal department to get back.
Big mistake!
What could you be doing in the interim to change the circumstances? What could you be doing to change the way that you're getting support? What could you be doing to document the support? What can you be doing to make it difficult for those who gave you support to backtrack? These are all based on observations. They're all the result of orientation. They're all decisions, and they're all actions that can be cycled faster and faster through the loop.
If you want to learn more about Boyd, there are several blog posts at advisorylawgroup.com that you can find - just search on the blog for "Boyd." There's at least one biography on Boyd that is very interesting and probably available at Amazon. And if you Google his name, you'll come across at least one or two sites that deal with military strategy that will have links to his now declassified military strategy papers. (I probably have some of that original source material which I’d be happy to share with you.)
In any event, think about cycling your strategy faster and faster through the OODA loop. And, whatever you do, don't fall prey to someone else's timing, especially if they've read Boyd.
|
| | | Wednesday - Medical Group Minute Video: Medical Group Mergers: Making 1 + 1 = 3
Watch the video here, or just keep reading below for a slightly polished transcript:
|
| When I was a kid, there was a new method of teaching math that was heavily marketed to our parents. It was called the "new math.” It was supposed to make it a way for math to be more easily understood by students.
We kids joked that “new math” was going to make 1 plus 1 equal 3.
As funny as we thought that was, in math class 1 plus 1 never made 3. But, despite our teacher’s inability to conceive that it ever could, in the domain of medical group mergers 1 plus 1 can equal 3. In fact, it should or there’s a large chance the deal shouldn’t be done.
Now when I say “merger” I don’t necessarily mean merger in the true legal sense, although it could be. It could be an acquisition. But in general, I’m focusing on the peer-to-peer combination of medical groups as opposed to a deal in which a local medical group is flat out being acquired by a national practice, whether or not financed by outside investors.
And, by 1 plus 1 equaling 3, I mean that when you structure a merger or evaluate a merger partner, you want to avoid a merger that is merely additive, one that takes 1 plus 1 and gives you 2.
The better approach is to bring on a merger partner that takes the 100X that you’re currently doing plus the 100X that they are currently doing, and which, when combined, results in 300X or even more.
Now, of course, I'm not talking simply about gross revenues all of a sudden making some sort of magical, mystical, metaphysical jump.
What I am talking about is the creation of additional value whether it has to do with the fact that it changes the way you can contract, whether it changes the way that payers look at you, whether it brings on skills that are much easier bought than homegrown, or whether it means expanding into a new geographic area in a way that is far less expensive than by organic growth.
To be truly valuable, to be truly powerful, to be truly rewarding, look for that new math.Look for deals where one plus one actually does equal 3.
|
| | Thursday - Podcast: Do You Know This Key To Negotiation? |
| Listen to the podcast here, or just keep reading for the transcript
Do you know this key to negotiation? The key that will open the door to a done deal, a deal that delivers on your wants?
I’ll tell you, but you have to promise not to tell anyone else. Just kidding.
Here is it: Make sure that the other party gets what it wants.
No, I’m not telling you that if, for example, the seller puts a $3 million asking price on the home that you should just wire him the funds. Or, that you should sign the contract that your employer puts in front of you.
What I mean is that you’ll cut right through to the heart of the deal by focusing on and figuring out how to deliver what the other party actually wants. I’ve put actually in italics to highlight it, to stress that what the other party actually wants is usually not what he initially says he wants.
The trick, of course, is finding out what the other party wants. That takes practice, experience and intuition.
You’ve identified the Jones Medical Group as a potential acquisition target. Its owner, Jennifer Jones, says she wants $X. Does she really? Is it the purchase price that is driving the deal or is it that she simply wants to shift some of the risk to you? Does she want the “safety” of a salary (no salary is ever safe, just safe to a certain point)? Does she want to escape the obligation to manage?
The fact is that once you discover what Jennifer really wants, it might be perfectly fine to deliver what she wants – it may be no skin off your back at all.
But if all you thought was at issue was the purchase price, you might never be able to make a deal, or the best deal.
|
| | | | We all hear, and most of us say, that the pace of change in healthcare is quickening. That means that the pace of required decision-making is increasing, too. Unless, that is, you want to take the “default” route. That’s the one is which you let someone else make the decisions that impact you; you’re just along for the ride. Of course, playing a bit part in scripting your own future isn’t the smart route to stardom. But despite your own best intentions, perhaps it’s your medical group’s governance structure that’s holding you back
|
|
|
| In fact, it’s very likely that the problem is systemic. The Medical Group Governance Matrix introduces a simple four-quadrant diagnostic tool to help you find out. It then shows you how to use that tool to build your better, more profitable future. Get your free copy here.
|
| | | | Whenever you're ready, here are 4 ways I can help you and your business:
1. Download a copy of The Success Prescription. My book, The Success Prescription provides you with a framework for thinking about your success. Download a copy of The Success Prescription here.
2. Be a guest on “Wisdom. Applied. Podcast.” Although most of my podcasts involve me addressing an important point for your success, I’m always looking for guests who’d like to be interviewed about their personal and professional achievements and the lessons learned. Email me if you’re interested in participating.
3. Book me to speak to your group or organization. I’ve spoken at dozens of medical group, healthcare organization, university-sponsored, and private events on many topics such as The Impending Death of Hospitals, the strategic use of OIG Advisory Opinions, medical group governance, and succeeding at negotiations. For more information about a custom presentation for you, drop us a line.
4. If You’re Not Yet a Client, Engage Me to Represent You. If you’re interested in increasing your profit and managing your risk of loss, email me to connect directly. |
| | |
|
