Intermountain Healthcare Consumer Experience Strategy Analysis

Archived writing sample. Originally published by Utah State University MBA coursework on June 25, 2024. Imported from the author’s WordPress archive for review.

---

Intermountain Healthcare

Intermountain Healthcare is an integrated health system operating in the intermountain west, comprising 6 states and more than 33 hospitals. Their size and management history has given them strong financial performance in spite of market challenges. Through mergers, acquisitions and natural growth, the company has reached nearly 90,000 employees, growing to more than 3 times its original size in a decade.

Intermountain Healthcare is widely recognized as being an innovative, low cost, high quality healthcare delivery system. The company internally emphasizes a strong culture of continuous improvement and mission driven decision making. Research based medicine and reliance on data driven clinical decisions using prompts from electronic medical systems as well as historical data are seen as important to driving clinical results and reducing costs. The culture propagated from the leadership team is one of failing fast, “operating at the top of your license” or empowering decision making at lower levels and moving quickly to chase meaningful growth and quality improvements.

Intermountain’s large size, vast resources, market presence, integrated insurance (SelectHealth), and streamlined supply chain allow its market dominance in the region. In spite of the success the company has enjoyed at large, its size, rapid growth and organizational changes have made a unifying strategic effort difficult to execute in some departments.

In the MACX team the symptoms of this rapid growth can be seen acutely. Strategy is fragmented and execution doesn’t drive any cohesive efforts around activities.

MACX

In 2011, MACX, then known as communications, had 18 employees coordinating across the entire Intermountain Healthcare system of about 21,000 employees. These numbers necessitated each MACX member to take on multiple roles.An external audit performed at the time determined that the communications department for a company this size was severely understaffed. Shortly after, a growth and hiring phase began, culminating in a department size of over 230 people in 2022.

The rapid growth called for a multi-year reorg of the department to restructure functional units and reporting structure. The new structure is largely a hybrid of old geographic and service line structures and new cross-functional team structures. In 2016, Intermountain Healthcare got a new CEO, Dr. Marc Harrison. Additional top level re-organizations followed. In 2017, the VP of the communications team retired and a new VP, Kevan Mabutt was hired as his sucessor. Mabutt, formerly the chief consumer experience officer for Disney resorts and cruise line, added the focus of improving consumer experience and changed the name of the organization to MACX, for Marketing and Communications, Consumer Experience.

The Intermountain Healthcare MACX is organized as a system wide department with both centrally located and regionally distributed resources. The directors are overseen by MaButt as SVP who oversees regional or service line managers. Managers coordinate marketing and communications efforts for hospitals and clinics locally as well as system wide efforts centrally, with the aid of specialists. Cross-functional teams like print, creative, social media, PR, analytics, etc. were created to share resources among the different managers. Every hospital and service line has a manager and there are managers for system wide marketing efforts.

Problems

Although the throughput of the team has increased, there seems to be little effort to focus the output or to align it with larger system goals. Very little information is shared between functional areas and cross-functional teams. There is a consumer insights team but very little actionable information makes its way to teams. As a result, there is wasted effort, duplicate work, and missed opportunities for meaningful movement towards larger system goals.

As structured, the MACX team is organized around a hybrid model of functional units and cross-functional resources. Below the SVP, the functional groups consist of clinical and physician communications, hospital and regional communications, research communications, Internal communications/executive support and business development communications.

Shared cross-functional resources include social media, consumer insights and planning, media/PR, web and creative. In terms of output, the fundamental activities of MACX are community outreach, external facing marketing, internal marketing, analytics gathering, and consumer experience touchpoints.

The basic function of the MACX team is to drive consumer choice using differentiators that will matter to the consumer: quality, cost and consumer experience.

There are several structural and cultural problems that prevent the team from executing on activities that drive value in these areas.

• Lack of data driven decisions
• Lack of information sythtethis
• Functional silos
• No feedback loop
• Burnout
• Attrition

When using Porter’s (Porter 71) activity mapping from What is Strategy to compare activities with strategic goals we see inconsistencies with activities and functional units as they are currently organized, and areas with little to no cross-collaboration.

Before restructuring, the teams were loosely instructed on the larger system goals but left to fill their markets needs and other stakeholder needs as they arose, being strategically disconnected in large part with a central strategy. After the reorganization, the teams remained ideologically similar and though structurally integrated with the “one Intermountain framework”, they continue to operate in silos.

Activities are duplicated in this structure and little cross-collaboration exists between siloed units. Information is siloed and guarded carefully, decisions are largely gut based or are driven by local stakeholders such as hospital administrators and community leaders which don’t address the strategic goals of the department.

While some functional units have bidirectional and sympathetic relationships with other functional and cross-functional teams, most do not. Valuable information, community and stakeholder insights, consumer insights and market research are largely squandered within these siloed units, denying teams of shared benefits and reducing the effectiveness of cross-functional teams.

Any insights gained in these silos is lost to the organization as a whole. Feedback is limited to the internal silos and efforts are largely gut based and not data driven. The information lost is a function of the lack of synergistic collaboration that could exist between units.

The consumer insights and planning team was meant to be a means to solve the later problem, with the goal of also eventually being an information synthesis point. The CI team would gather relevant data about consumers to help guide decisions. The functional units would work with this team cross-functionally to get valuable research data, but would also be expected to close the feedback loop of their efforts to learn and grow. The CI team was made a central point of project and campaign processing, requiring approval from CI as well as justification. In practice, the CI team is seen as a rubber stamp organization to project approval that is locally but not globally strategic. Feedback is generic or missing and few data based insights into future campaigns and efforts can be derived.

The messaging in word and deed from the top level leadership, is one of continuous improvement, innovation, flexibility and empowerment. While continuous improvement measures are espoused and tracked, they are mostly local and small issues that don’t propagate through the department. Though there is some sporadic innovation, it too is local and doesn’t impact any larger goals. The structure is rigid and unyielding with several layers of convoluted hierarchy and approval and empowerment is a measure of political capitol. The resultant conflict between the enthusiastic, well meaning and optimistic top level messaging is at odds with the day to day realities created by a structure that is misaligned with goals and the activities that achieve them. The predictable result is poor employee morale and high turnover - 21% turnover in the last 3 years. One of the five department wide goals for 2022 is “Improve Mac Experience”, with activities centered around understanding drivers of morale and turnover and to make recommendations. Other goals are to increase community affinity, advance equity, strengthen brand, and improve access.

The old structures that existed in the small disconnected communications team persist in the larger, reorganized units. The Inertia to change politically has become a huge liability as the organization has drifted into automatic behavior “…taking on rigid and politicized chains of command as well as cultural norms and ideologies that impede change.” As described in Strategy as Diligence: Putting Behavioral Strategy into Practice (Powell 168).

Diligence

Intermountain Healthcare CEO Dr. Marc Harrison is fond of telling people that pursuing lower costs and quality aren’t mutually exclusive and that we can grow and continue to perform in our key areas. “We can walk and chew gum,” is a phrase he likes to use. The idea compares favorably to the analogy that diligence based strategy is like mountain climbing from Strategy as Diligence (Powell 167) - strategy and action can coexist. For example, during the pandemic the organization was able to stay financially strong, shift to pressing clinic needs, adapt to new realities of working and still be able to grow, creating new companies and acquiring others. There has been tremendous flexibility and dynamic strategy at the top level leveraging existing resources to create new opportunities. “They used the Pandemic as a springboard,” according to Dr. Scott Stevens, associate chief medical officer at Intermountain Healthcare, in an interview with him this year.

Good examples would be the creation of companies like Tellica, a generic outpatient imaging service, Castell, a population health firm and Civica, a generic drug manufacturer. Ideas that grew out of leaders’ desire to solve problems and the use of Intermountain resources to seed. Top level leadership encourages and trains its leaders to act in a polyarchy within their spheres, but in a highly integrated way, using shared resources and information. Intermountain leadership principles are:

• Be mission obsessed
• Empower one another
• Act with courage
• Drive results

These principles are taught in an extensive leadership development program meant to replace old thinking with ideologies that are consistent with the organization. The company is investing heavily in programs and education such as a leadership development course and leadership path that clinical program VP, Ralph Gene-Mary is a recent graduate of.

In an interview with Gene-Mary he cites the ability to derive and execute on evidence based guidelines for care as a key strength of Intermountain, but also recognized the distance left to go in decentralizing leadership with differentiation. “Our organizational structure is not fine tuned to our patients’ needs. We manage Intermountain traditionally (vertically) where we should be managing across service lines.”

Using the Integrative/differentiation map from Designing Organizations for Dynamic Capabilities (Felin and Powell 82) as a guide, we see the top level leadership choosing to act in a differentiated way, with high levels of integration.

Conversely, the MACX team is composed of several pockets of minimally differentiated groups, working with little integration outside their silos. As a result, the MACX team at large is floundering in “insularity”, where the biggest innovations and results are a product of the strongest wills and creative ideas which work in spite of the structure, not because of it. The product of this structure is low output efficiency - high workload with minimal impact. A byproduct is a mismatch in mission and results causing frustration, burnout, and turnover. Informal exit surveys indicate a frustration with a lack of progress as a key reason for seeking other employment.

Moving Forward/Recommendations

If the leadership now and into the future is moving towards a highly differentiated, diligence based strategy, the problem to solve is realigning the MACX department to function in a similar way. The two solutions that present themselves are to enact cultural change policies that encourage people to work outside of politically comfortable insular groups and work with the existing structure to become more differentiated and integrated, or to change the structure to discourage insularity. The former focuses on changing behavior to work with structure, while the latter focuses on changing structure to work with behaviors. Understanding that changing behavior is generally much harder than encouraging behaviors to work with new structures, the latter is more appealing.

Working with the idea that the key market drivers for consumers are cost, quality and consumer experience, we can use these as anchors to organize fundamental activities that serve these efforts.

With these anchors we can look at the fundamental activities of MACX, which are community outreach, external facing marketing, internal communications, analytics gathering, and consumer experience touchpoints. These are the activities where mastery increases organizational performance, and where resources can be allocated and results measured (Powell 169). The sub activities of these break down into products of the MACX team, namely: writing, print, design, events, programming, photography, video, digital publishing, information gathering and synthesis, and promotional partnerships.

The organization structure needs to align to these activities and sub activities in order to meet the moving targets of communicating quality and cost differentiators, driving down cost through operational efficiencies, and creating and marketing a better consumer experience that touches the consumer.

With this in mind, a structure that may work is considered below.

Functional units based around community outreach, marketing, internal communications, and consumer experience touchpoints. In this structure there are no geographic silos and there are fewer redundancies resulting in a higher throughput per contributor, reducing burnout. In this structure, analytics gathering is a bottom up group that functions primarily to collect insight from the teams and synthesize it with external research to produce actionable insights which are regularly distributed teamwide.

Cross-functional teams would self-select into campaigns and ideas that drive results in each of the functional areas. These teams would include design, photography, video, and publishing. All projects, campaigns and products would need to be analyzed and measured for effectiveness and communicated back through the analytics and insights group as additional data points. An SVP, using data driven from campaigns, directs resources to ensure that areas of strength are balanced with areas of weakness using the multiplicative rule for total strategic capital (Powell 171).

The effort wouldn’t be without its challenges, though. Ensuring individuals have the ability to dynamically shift from a variety of projects and stakeholders without creating silos is one foreseen issue. In addition there is still a geographical limitation to consider, where hospitals and clinics need people to solve local problems and communicate local needs back to the analytics group. There would also need to be tight control on collecting and measuring performance and comparing that against objectives. The biggest hurdle would be to overcome years of programming that information, methods, contacts, and networks are to be guarded voraciously as competitive advantages for silos and individuals or to protect or arm yourself against internal politics and posturing. In short, a change with a concerted effort to learn to trust the whole and not just those in a tight knit circle or political allies. In fact, it’s very likely that these behaviors would likely reappear. Special efforts must be taken to audit the work to ensure that pockets of competition don’t organize into separate units.

The upsides, however, are huge and include increased efficiencies, more targeted and coordinated efforts which more directly impact the community and closer alignment with the stated mission increasing morale.

Works Cited

Felin, Teppo, and Thomas C. Powell. “Designing Organizations for Dynamic Capabilities.” California Management Review, vol. 58, no. 3, 2016, pp. 78-96.

Porter, Michael E. “What is Strategy?” Harvard Business review, vol. Nov-Dec 96, 1996.

Powell, Thomas C. “Strategy as Diligence: Putting Behavioral Strategy into Practice.” California Management Review, vol. 59, no. 3, 2017, pp. 162-190.