Value Creation

The word “value” gets used a lot in healthcare these days. We often use it specifically in terms of the value equation that calls us to focus on quality, safety, service and, ultimately, decreasing the cost of care. However, when it comes to Value Creation, I have been motivated to create value in an entirely different context especially as it relates to building high-performing teams. It’s my view that the survival, growth and success of the healthcare field hinges on the ability of the current generation of leaders to create value every day in their organizations.

This may not be widely understood or an accepted way to think about value. In fact, value creation may not explicitly show up on the list of strategic goals or key performance metrics, yet nothing I do as a leader matters more. Let me explain why.

Every business grows and succeeds through value creation. In the traditional approach, as laid out by Michael Porter, value is created by optimizing and innovating at every point on the supply chain, from inputs to outputs. That concept of value is measured in terms of profitability and shareholder returns. However, in the healthcare field we typically are not driven by shareholders, rather we are guided by purpose and the people we serve. In fact, one of my most important responsibilities is to nurture others to realize their full potential.

Today, most business leaders understand that value creation is broader and more nuanced than Porter’s operational and financial priorities. Value creation must benefit all stakeholders – including customers, shareholders, employees and the community – and I know that it is disproportionately created through people and culture. This is why creating value in leadership is vital.

So what does that have to do with healthcare leadership in particular?

As leaders we rightfully tend to focus on quality, safety, employee engagement and producing a positive operating margin. We also spend our time on the big picture, thinking about execution and growth to secure our future by creating a more stable and successful organization.

These important decisions and measures are outputs of value creation. The value creation itself happens by putting the right people in the most mission critical roles, using a framework defined by talent, teamwork and strategy. All of which needs to be supported by a people-first culture, purpose and a commitment to optimal performance.?

I’ve been thinking about value creation in my role as a leader for years and wanted to share my thoughts. The past couple years, much of my attention has been focused on the recovery from the significant distress that COVID-19 has had on our organization’s financial health, and our staff’s mental and physical wellbeing. The leadership skills and resolve required to overcome the challenges ahead have never been more apparent. We must take this opportunity to position our organization to thrive in this dynamic and rapidly changing environment.

Value creation distinguishes the best organizations from the pack. And, in our field today, only the best organizations have a real chance to succeed.

The challenge is getting the formula right, and when we do, the results are profound. Guided with a value creation mindset, we must embrace the fact that we are a high-performing, complex, fast-paced organization that is filled with talented people who are vibrant and prepared to innovate and create the future of healthcare. A value creation culture fosters trust, vulnerability, openness to diversity, with a shared purpose, resiliency, flexibility, teamwork, and in a psychologically safe environment. In that type of environment, people communicate openly, make decisions quickly and function at the "top of their game." The results, in terms of performance, revenue, growth and quality outcomes, flow from there.?

First and foremost, I’m proud of the work we do and the fact that Creating Value is our “Why”.??

I have been blessed to work with an extraordinary group of leaders at Yale New Haven Health and the L+M Delivery Network. I’m grateful for having the privilege to work alongside every one of our associates every day to create value.

Together we have become Value Creators!

My hope is that this helps you re-imagine your role and to think about the profound impact you can have on an organization by leading with a Value Creation mindset.