Business Strategist as Coach: Michael Porter on Building Health Care Champions
Animated, criss-crossing the auditorium and filling the room with praise, Michael Porter, Ph.D., seemed more like a coach pumping up his team before the big game, than a Harvard Business School professor delivering a lecture to a room of health care professionals and researchers. He uttered the words, “win” and “goal” about a dozen times during Wednesday’s faculty address.
Founder of the field of modern strategy, Porter coined the terms “competitive advantage” and “value chain,” and practically defined the American work ethic. Author of 19 books, he is one of the world’s most influential business professors. And yet here he was on the University of Utah Health Sciences campus delivering a cheerleader-like call to action to fix a broken health care system. While the complex and overwhelming nature of this task has ended the political careers of more than a few well-meaning folks, Porter remains undaunted. He framed the challenge and mapped out the winning play. “We see where we have to go and what we have to do . . . . Now we have to get it done.”
Porter has credited his involvement in sports for sparking his interest in competitive strategy. He played football, baseball and basketball in his youth, and led the NCAA championship golf squad at Princeton. So it is, perhaps, that he’s able to bridge high-level economic theory with more pedestrian strategies of tangible value to business leaders around the globe.
What Porter served up, though, was more than mere sports metaphor. Like any good coach, or CEO for that matter, he led by example, delivering inspiration grounded in evidence and cloaked in encouragement. “Why are we all here? To deliver value for the patient . . . and value is the outcomes we’re achieving relative to how much cost we have to expend to actually deliver those outcomes,” he said. What we need is absolute clarity on our fundamental goal. “If we can get everyone aligned on that . . . we’re 70 percent of the way.”
Porter didn’t sugar coat things. Everyone knows what’s wrong with health care and how to make it right, he said. Yet for decades, the industry has stubbornly defied strategies for improvement. From consumer-driven reforms and capitated payments to electronic medical records, none of our “magic bullets” has worked.
That’s because, while these are all good ideas, “they don’t get at the real problem, which is the fundamental structure of health care delivery,” Porter said. “Until we tackle that problem . . . all these things are incremental overlays. We’ve got to transform the actual way we deliver care. How you work, how you measure how you’re doing, and how you define success.”
Porter’s 2006 manifesto, Redefining Health Care, was challenged by his friend, Princeton health economist, Uwe Reinhardt as: “A utopian vision . . . that might occur to anyone possessed of a modicum of common sense but not too familiar with the real world of health care.” But increasingly, due to a growing body of examples of institutions succeeding, health care leaders are coming around to Porter’s way of thinking.“
At the core of Porter’s theory is the Integrated Practice Unit, or IPU – or moving away from organizing health care around specialties, departments and lines of service to organizing it around the patient’s problems. For specialty care this means organizing around episodes of care, and for primary care, it means organizing around groups of patients with similar needs. “Primary care for a healthy adult is completely different than primary care for the elderly and frail,” he said.
Few disagree with him outright. “The biggest pushback has been that it’s impossible to do, that it’s the right idea, the fright framework, but it’s impossible to do,” Porter said. Pick your impossible problem: The intransigent fee-for-service system, burdensome and unhelpful electronic medical record systems, overtaxed providers and patients who defy categorization by IPU’s. There has been no shortage of reasons why it can’t be done.
“It’s a journey, it takes time and it’s not easy, but we can get there,” said Porter, once again setting an optimistic and encouraging tone for his audience team. “You’re on the path,” he said. “These concepts are clearly taking root in Utah.” Just don’t get hung up on the payment system, he advised. “Yes it’s screwed up. But if you start moving to value, and measuring, and proving that you can deliver it . . . over time, you will be the organization that wins.”
Kirsten Stewart is a Senior Writer for University of Utah Health Sciences
