The symptoms were typical of any billion-dollar company that
had started as one primary business and branched out over the
years. The founding concept — in this case, Mount Carmel
Health System’s hospital division — was still revered as the pinnacle of the organization. All other subdivisions, such as outpatient care centers and the College of Nursing, were treated exactly as that: subordinate.
“There was a tendency years ago to have hospital-centric systems,” says Claus von Zychlin, who became president and CEO
of Mount Carmel Health System, a member of Trinity Health, in
July 2006, and quickly diagnosed this long-standing flaw in how
the system was organized. “Our hospitals generate the largest
volume, so a lot of these things became like a department of the
hospital somewhere. They kind of got lost in the milieu.”
That stifled growth in certain areas and caused frustrating mismatches between leadership skills and organizational duties in
some cases.
For example, the education division — which includes the
Mount Carmel College of Nursing as well as the graduate medical
education program that trains aspiring physicians during their residencies — has historically reported to one of the hospital administrators at Mount Carmel.
“At the time, they really had very little knowledge about graduate
medical education, and it really got the attention only when something was broken, not the attention of, ‘Where do we go tomorrow?’”
he says.
To fix these types of problems, von Zychlin tossed out the old
organizational chart and created four new divisions — one each for
education, ambulatory care, managed care and physicians — and
put them all on equal footing with the hospital division. He also
hired or promoted administrators with specific expertise in those
areas to head up each of the five divisions within the $1.1 billion
organization.
“By separating them out into divisions, with each of them having an
executive sponsor, they each have the time and attention they need
rather than being buried underneath some department of the hospital,” says von Zychlin. “That has added to their accountability, their
ability, and, I think, in general, to the psyche of the people who
work there. They realize they’re an actual division that has the
same level of responsibility and visibility as the hospital traditionally had.”
The results have spoken for themselves. Expenses have dropped
by $61 million between fiscal 2006 and 2007, thanks to a systemwide efficiency review. In that same time frame, supply costs
have decreased $1.5 million and Mount Carmel College of
Nursing’s operating performance has improved by 38 percent.
Here’s how von Zychlin’s eye for reorganizing and creating equality and collaboration within Mount Carmel is helping the system
reach new heights.
