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Holy Cross Hospital Bounces Back from Near Collapse

May 1, 1999
Related Topics: Change Management, Recognition, Featured Article
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Eight years ago in Chicago’sSouthwest Side, Holy Cross Hospital’s chances for survival seemed about asbleak as a flat-line on a heart monitor. It reported an operating loss of $8.9million and laid off 125 employees, which sapped what little morale remained.

But thanks to a dramatic performanceturnaround spearheaded by the human resources department, the 400-bed hospital,founded by a Catholic order of nuns in 1928, today leads a healthy, robust lifeas a miracle child of the health-care system. Today, Holy Cross has been rankedamong the top 10 percent of hospitals nationwide for patient satisfaction,according to Press, Gainey Associates, an independent research firm in SouthBend, Indiana. 

The extraordinary comeback, designedby then incoming president and CEO Mark Clement, required HR to boost moraleamong the surviving employees and rebuild a new workforce. Clement committed toa “partnership” management style and a share of the rewards as the hospitalsucceeded. To learn how Holy Cross bounced back from near collapse, Workforceinterviewed Vickie Piper, former vice president of human resources for thehealth services company.

 

When your company first laid off 125employees, your then incoming president and CEO committed the remainingemployees to a “partnership” management style and a share of the rewards asthe hospital succeeded. How was this handled from a human resources perspective?
    First, we established a newrelationship with our employees by referring to them as partners, and began tocommunicate with them on a first-name basis. We asked them for ideas that wouldbreak down the barriers that hindered them in their jobs. It helped open theculture, and let people know it was okay to speak up. It also helped peopleenjoy what they were doing in what can be a pressure-filled business. It helpedbuild teamwork.


    We also increased the amount ofcommunication. We wanted to be honest with what was happening in theorganization and what each partner could do to turn things around. We thenintroduced a set of values with specific behavioral definitions that empoweredpartners to make decisions, as long as they were consistent with those values.This helped guide our partners’ involvement in turning our organizationaround.

    Our next step was to get peopleinvolved in both departmental and organizational teams to tackle the barriersthey had identified. We tried to do that in a way that introduced fun, and weencouraged people to introduce new ideas.

How did you open up communication in amore “honest” way?
    We painted for our partners a truepicture of Holy Cross. When the hospital lost $8.9 million in 1991, it was a bigsurprise to everyone. We started talking to our partners about the realities ofthe health-care environment, who our customers are, and why it’s important forus to satisfy those customers. The hospital CEO conducted a series ofround-the-clock meetings to talk directly to partners about our goals: thehealth-care environment and specifically what they could do to help.


    We also provided our leaders within-depth training. We didn’t assume that they understood all the complexitiesof managed care, so we trained them on how to deliver those messages to theinternal staff.
How did you boost company morale duringthis time?
    There was no magic bullet, and itdidn’t happen overnight. You can’t just make the survivors of a layoff feelgood about it. We put a lot of effort into recognition, even of smallaccomplishments. Service was the No.1 thing we wanted to tackle first, holdingto the philosophy that you can’t build a successful service business ifcustomers aren’t happy with the service they receive.


    We provided many rewards connected withservice improvement and idea generation. We’d do things like give away cups ofpopcorn or flowers or pizza to communicate messages about desired partnerbehavior. We’d perform skits about what’s the right way to answer the phone,things along these lines. At the same time, we put a drive on ideaimplementation, one idea per individual. We put people to work on teams indepartments and across the organization. In our first year, we generated 1,600new ideas.
What sort of ideas are we talking abouthere?
    We wanted to hear everything, includingsmall ideas. For example, one person suggested the menus we pass out to patientsshould contain contact information if they have questions. Another personsuggested we should do something different with how we stock supplies that had abig impact in cost savings.


    We purposely pushed for quantity. Wedidn’t want anyone to be discouraged because an idea wasn’t big enough orgood enough. The first year, we probably didn’t see a substantial return onour investment, but over time, we helped people become more focused on morespecific ideas with significant return on investment.
Did the development of these ideasbuild employee morale?
    We believe in friendly competition.It’s friendly because we design ways to share information and to shareexpertise between areas. For example, if one department can’t get anyone tosubmit ideas, we’ll get a few people from other areas that are doing well tovisit them and discuss ways to generate ideas. It’s the type of competitionthat stirs motivation. It never loses sight of the fact that we all have tosucceed in order to be successful.
How do you reward employees?
    We reward for achieving our goals andfor living our values. For example, last spring was a busy period, so everyonegot a basket with a complete Italian meal for a family of four - pasta, sauce,cheese, bread, wine, chocolate - as a thank you for working so hard. Financialincentives are determined on how well the hospital does. In our first year,everyone received $50 to $75. The maximum we’ve given was two years ago: $500for every full-time partner, and $250 for every part-time partner.
 
How do you monitor gains in employeemorale and patient satisfaction?
    We continue to measure weekly patientsatisfaction. We have an internal structure of teams called Customer ServiceCommandos that has been in existence for about five years. They focus on variousaspects of service, come up with new and different ways to tackle issues. Forexample, one team focuses on removing customer irritations. They scan the surveyto find what’s popping up as an irritant.


    As for employee morale, we conduct apartner satisfaction survey every 18 to 24 months, and we also do a leadershippractice assessment, which gives partners an opportunity to evaluate theirleaders. The leaders are required to communicate results back to their partnersand to follow-up on how they’re addressing their partners’ concerns.
So managers are subject to evaluationsthat can lead to reassignment or termination?
    We take evaluations pretty seriously.It’s about development - not a matter of getting a perfect score. If we seesomeone who is evaluated as not being responsible for his partners’ issues,then there’s a development plan put together. If we don’t see significantimprovement by the next evaluation, then we look at where we should be placingthat individual. 


    Generally, there are other indicators.If the department isn’t achieving its financial or customer service goals, wedon’t need to wait 18 months to do another survey. At Holy Cross Hospital, webelieve if you have the right management practices, you’re going to build astrong team, and if they’re focused on the right goals, you’re going to havegood performance.
What sort of multifaceted approach doyou have for hiring new employees?
    In changing our culture, we examinedall of our “people practices.” One of the key practices that we modified waspartner selection.


    First, we developed a video in whichour partners talk about the company’s values, and what that means. We puttogether a cross section of our partners - dish-room personnel, secretaries,nurses - because they had been recognized as representing our company values.


    If someone comes in for a job, weexplain the application process, and that they’re required to watch this17-minute video before we give them an application. If they don’t have time orthey don’t want to, they don’t apply for the job. We also observe peoplewatching the video, and that gives us a whole wealth of information. Some peoplesleep through it, or balance their checkbooks or fast-forward. What they don’tknow is that, afterward, they get questions about the video. On a simple level,it’s a great way to find out if they even paid attention to the video. Ineffect, it’s our first measure of whether or not this is a value-centeredperson.
How do you measure a candidate’sattitude and communication skills?
    First we use an HR-clerical partner toevaluate the candidate’s first impression. It’s a great way to catch greatpartners and really bad partners. Someone may give a great presentation to arecruiter, but an indication of his real behavior may be how he treats theclerical person handing out the forms.


    We then call them in for interviews. Weinterview groups of as many as 25 people at a time. We take them into a largeroom and give them basic exercises they’ll do by themselves and in smallgroups. These exercises are designed to be fun, and create an atmosphere inwhich applicants feel comfortable. And they’re designed to measure thoseattitudes or qualities that we believe are causing our turnover. Sometimes wefind someone’s pretty sharp in a one-on-one interview - only to find theydon’t have a high-degree of flexibility and they don’t work well with otherpeople.


    We don’t use this technique for alldivisions. It’s designed more for those positions with large numbers ofapplicants with equivalent background and experience, and where we hadexperienced a large number of turnover: housekeepers, dietary aids, patient-caretechnicians, admitting and pharmacy technicians.


    Usually there will be one HR person,one hiring leader and maybe others with actual evaluation sheets in front ofthem. We’re really looking for communication, teamwork, problem-solvingabilities and flexibility. Most of the exercises aren’t designed to have oneright answer. We’re looking to see how well people work together. We’ve seendramatic results. An articulate person may get in a team situation and turnaggressive - he or she doesn’t listen, or snatches things out of people’shands.


    It’s added a depth of knowledge aboutcandidates, and has significantly reduced our turnaround time. By using thesetechniques, you can get to the end of the day and know that out of 20 people,there are six you’re interested in hiring. It may mean a big commitment for aday, but the return on that investment is significant.
Overall, how well have these programsworked for Holy Cross Hospital?
    All the changes we’ve made havedramatically changed the culture at Holy Cross Hospital. We now have partnerswho actively support our value-driven organization, and they’re engaged inachieving our goals.

Workforce, May 1999, Vol 78,No 5, pp. 94-97  SubscribeNow!

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