Dr. Robert Corrato founded Executive Health Resources in 1997 as a small start-up built around the concept of medical compliance solutions to hospitals.
Corrato’s new company created its own niche, which allowed for a highly entrepreneurial attitude within the organization. The rules weren’t set, the boundaries weren’t drawn, and Corrato was allowed a blank canvas on which he and his staff could create and innovate.
But in the ensuing 14 years, the game has changed. EHR’s leadership defined operational processes to guide the company as it grew to 1,600 full- and part-time employees. Through necessity, EHR became more operational in nature.
But innovation is what built EHR in the first place, and Corrato wasn’t eager to let go of the freedom afforded by an innovative culture. The expanding company needed a sense of order, but in order to keep growing, Corrato still needed to keep an innovative mindset at the forefront. He needed two mindsets, often divergent, to exist in the same culture.
“Oftentimes, the competencies that are required to be entrepreneurial and start something up are different from the competencies needed to scale an organization as it grows over time,” says Corrato, the company’s president and CEO. “With that in mind, probably the toughest personal challenge I have faced here has been changing with the dynamic needs of an organization in different iterations of growth. It has been a tough challenge from a learning perspective.”
Corrato has constructed components within his organization that focus individually on the innovative and operational elements of the business. But he also needed to figure out a way for the two components to develop a symbiotic relationship — the innovators offering ideas to the operators and the operators offering structure to the innovators. It has required Corrato to define the company’s culture in specific terms, hire people who can help promote the culture, and ensure that there is a system through which the innovators and operators can collaborate.
Define the culture
Like most young businesses, EHR’s culture wasn’t designed at the outset. It took a number of years for the culture to evolve and meet the needs of a company with rapidly accelerating growth.
In the early days of the company, Corrato and his staff focused on building up a core of industry knowledge, then listening to clients, responding to their needs and providing services to meet those needs in the most efficient manner possible.
“First and foremost, you have to build a deep expertise and knowledge in your space, and you have to initially keep your nose to the grindstone, listen very carefully to the clients you have been able to engage and cultivate those early adopters,” Corrato says. “Then, you have to couple that momentum with your deep knowledge of the industry to continually refine what those services or product offerings are going to be. Once you have a good concept of what the service offerings need to look like, you then need to say ‘OK, if we are going to be able to provide these services with excellence, and do it to a large marketplace, how do we take the best of what we do and scale it in a way that ensures a consistent, excellent approach?’”
Over the years of shaping and reshaping EHR, Corrato has learned that a successful company’s culture revolves around three tenets. Employees need to believe in the value of their company’s purpose, there has to be a defined business case backing up the purpose, and employees have to extract a sense of enjoyment and satisfaction from their work. Without those three factors in place, it becomes difficult for a culture to sustain itself.
“It is a daily tactical initiative,” Corrato says. “It is very easy to have the right rhetoric, but if the people in the organization don’t see you, as the leader, living that every day, you can run into problems. Living it can be as simple as you’re walking down the hallway, you see a piece of paper on the floor and you pick it up because you’re proud of the way your office looks. It can be on a large scale, like ensuring that you’re there every day to support every person in the organization, whether they’re in marketing, account management or whatever component they might be in. If you’re willing to be tangibly available and a presence, that is the first step in getting to those three tenets of a good culture.”
Without your actions, your words become hollow, and the cultural seeds you’re attempting to plant will never sprout.
“This is an exhaustingly important job, because if you don’t do it, and keep doing it, it simply becomes rhetoric,” Corrato says. “And people are smart. If they hear rhetoric and don’t see the actions to match it, all faith is lost, and the foundation on which your organization should be supported begins to crumble away.”
Put people in place
From the start of the recruiting and interviewing process, Corrato wants the people who come through the door looking for a job at EHR to understand the company’s culture and what is expected of team members.
If you want your culture to embrace specific cultural tenets, you need to ensure that you’re bringing aboard people who can embrace and advance the culture.
“The last thing we want to do is take the time and effort to recruit and interview, and then bring the wrong person into the organization,” Corrato says. “It is much harder to do that than to prevent it from happening in the first place. That is why you need to develop a thoughtful, detailed recruiting process that allows the individual to learn about the organization along the way.”
Having a good recruiting process begins with having good recruiters. At EHR, members of leadership from the various departments meet with job candidates to explain how the company values both innovation and operational stability, and how it plays into that particular field.
It comes back to organizational connectedness. Your hiring process can’t be completely separated from your daily operations or the areas that will thrive on the ideas that new employees will bring to the table.
“Your recruiting can’t be disconnected from the operations and everyday goings-on,” Corrato says. “The folks who are leading various units of the company also have a role on their team as input into the evaluation of those coming into our organization. It is a good and structured approach that brings in the subject matter experts in our organization to do an evaluation of the individuals who come into the organization. The connection is important to have. If that’s disconnected, then you will find that the folks who are going to be working with the new, recruited individual may find that they have made a misstep in hiring, and that goes back to the fact that it’s much harder to correct a misstep than to make the right hire in the first place.”
Get things moving
If you’ve defined a direction and built a work force that can help support that direction, the question becomes, how do you get to your goals?
At EHR, this is where the question of innovation versus operations became prevalent.
“It is a classic dilemma of how do you take an organization that is very scaled and detailed, and how do you interject the ability to create innovation,” Corrato says. “It’s a constant dilemma because they are very different processes. The operational process is one where you’re measuring on a daily basis what you are doing and honing the operational machine. Innovation, on the other hand, is more of an approach that is centered on projects.”
Corrato’s solution was to break the innovation out from the operations. He set up innovation teams to produce ideas for new products and services. The ideas are pieced together by the teams, and then presented to the heads of the operational aspects of the organization for review. It begins a back-and-forth process between the innovation and operations sides of the business, that will, over the course of several rounds, refine an idea into a product that can be rolled out to customers.
“The key is to develop these processes within the organization that allow for the development of innovation, but very closely feed the ideas back to the operational organization,” Corrato says. “If you have an operational organization and try to have those people innovate, you will find that there is always a reason why the operations need to come first. There is always something that will have to be an operational priority, and it will get in the way of that innovation component coming first. That is why you need to segment that innovation aspect out in your organization, but have it connect back to the operational areas when the time is right, given the level of development of the innovation.”
The innovation and operation aspects of EHR have also developed a mutually beneficial working relationship because all areas of the company are narrowly focused on a set of end goals. The operational heads do not hinder the creative process of the innovation teams, but the innovation teams also have a responsibility to stick close to the organization’s mission and purpose with the ideas they create.
Innovation needs to work in harmony with operations because innovation needs to help propel you toward your goals. You need to keep your innovative minds centered on your purpose and mission. If you ever need to move away from your mission, that has to be a decision that comes from your head office, not from an idea generated down the ladder.
It helps if everyone in your organization, whether they are idea generators or process managers, stays in touch with the market and understands what customers want and need, and how you can best serve those needs. In a nutshell, you have to know what you do well as a company and constantly try to figure out new ways to leverage that set of core competencies.
Corrato says it’s a matter of going deep versus going wide. Companies that go deep strive to become experts in a narrowly defined area. Companies that go wide are constantly probing for new areas to develop, which may offer a more comprehensive set of products or services to clients, but may also force the company to sacrifice expertise in a particular area.
“I’ve heard a number of folks say that no company has ever gone out of business by focusing,” Corrato says. “So that’s why it’s critical to focus on the market and services, and what your clients need. Once you’ve done that, if you want to grow, you need to assess whether the market is expansive enough to allow for the scaling of an organization. Not every company has to be a large, scaled national organization to achieve success. But once an organization decides the track it wants to take, then you have to create a repeatable, standardized and scalable approach that will result in A-plus service.”
With new ideas coming from your innovation teams, you have to weight the positives and negatives of each and project the ultimate benefit to your company. Again, you come back to finding a balance between innovation and operations.
“If you have this amazing new opportunity, what is the opportunity cost?” Corrato says. “If the cost of going wide allows you to lose an opportunity that is right in front of you and has a lower cost to attain, depth would probably come before breadth. But if you’ve already saturated and solidified your current market and it is now time to look at adjacencies, to expand your offerings, you can create the opportunity to upsell to a satisfied client base. It’s really about the pros and cons of wide versus deep, given where you’re at in your current market.”
How to reach: Executive Health Resources, (610) 446-6100 or www.ehrdocs.com
The Corrato File
Name: Robert Corrato
Title: President and CEO
Company: Executive Health Resources
Education: Biology and psychology degrees, La Salle University; MBA, Wharton School of Business, University of Pennsylvania; M.D., Medical College of Pennsylvania
What is the best business lesson you’ve learned?
To create a business case for the Golden Rule — treat others as you would want to be treated. Always keep in mind doing the right things for the organization, and everything else falls into place. There is definitely a business case for doing the right thing.
What traits or skills are essential for a business leader?
First and foremost, honorability. You have to be honest. You also have to be able to take your vision and instill it in others, and instill confidence in the vision.
What is your definition of success?
My ultimate definition of success is when people are proud of the organization. If you have that and a culture that supports that, you have the foundation of a strong organization.