Masters In Business

How Quint Studer used quarterly evaluations to help Baptist Hospital reach its goal of becoming the employer of choice

It's a cliche these days to say that the best way to satisfy your customers is to satisfy your employees. Like favoring motherhood and apple pie, it's a hard thesis to argue against. But as a manager, how do you get started? How do you actually change a company's culture? And how do you know if you're succeeding? Until we met up with Quinton Studer, president of Baptist Hospital Inc., in Pensacola, Fla., we were skeptical of those advocating cultural change within an organization. Most had never given it a try in the real world.

Studer, who arrived in Pensacola in June 1996 from a stint as senior vice-president at Holy Cross Hospital in Chicago, has spent the last several years developing a system to improve both patient and employee satisfaction. Surprisingly, the model is based on his years as a special-education teacher. "Maximizing an organization's ability is similar to maximizing a child's potential," Studer says. "The first step is to diagnose the situation and then set achievable goals. The higher the goals, the closer the student--or organization--comes to reaching full potential. Every 90 days the teacher does an individual education plan to ensure that all resources directed to the child are aligned with the goals. And at the end of a year, old goals are reassessed and new ones are set."

While that's the basic plan, Studer has refined his system over the years and brought it to the point where it's replicable not only in other hospitals but in any service business.

When Studer arrived, Baptist's admissions were flat, and patient satisfaction as measured by a national survey was slightly below average. After just two years--in an industry in which admissions are staying the same or going down--Baptist's admissions were up 8.3%. Outpatient volume was up 33%. As for patient satisfaction, Baptist ranked number two in the country for all hospitals and number one for hospitals with more than 100 beds. Employee satisfaction had improved 30%, and physician satisfaction had risen from 72.4% to 81.3%. Job turnover for nurses went from 30% to 18%. Inc. senior editor Nancy J. Lyons queried Studer about Baptist's cultural turnaround.

Inc. : Changing a culture seems more than ambitious--it's an absolutely daunting idea. Yet you seem to have accomplished a great deal in a very short time at Baptist. How did you get started?

Studer: We decided we had to have a measurable service goal. I believe you have to measure what's important to you, and that you have to have some means of comparison. If a company can't afford an outside group to do a survey, which I strongly recommend, it should develop its own tool. So, first of all, we met with all the employees and talked about why the hospital exists, what our purpose is. They said that they wanted to be the best. Becoming the employer of choice also became a goal at Baptist.

Inc. : So you started out measuring patient satisfaction?

Studer: Yes. We use a large patient-satisfaction-measurement company that can compare us with at least 500 hospitals across the country. We send a survey to every patient. The results help us set specific goals. They also give us an opportunity to recognize employees who receive positive comments on the survey.

Inc. : OK, so you know where you stand from the survey, and you know where you want to go. But up to now, nothing has changed, right? It seems that this would be where most CEOs would get stuck.

Studer: What we do next is the number one thing companies just don't want to spend money on: middle-management development. We take every one of our leaders--nurse managers, supervisors, and department heads--off-site for 2 days every 90 days. We also have employee forums every 90 days and survey employees on their attitudes toward their supervisors. Our employees knew their supervisors hadn't had any "real" training, but we also let them know it's an organizational issue--not their supervisor's issue--to provide development. We call it leadership muscle building. That's what my whole job is about. Accountability, by the way, is key.

Inc. : What do you mean by accountability? Who's accountable to whom and for what?

Studer: All our leaders get "report cards" every 90 days. That's how we align behaviors to our goals and how we can reward objectively, which takes politics out of the game. A typical person in our organization will have four measurements. One is customer service, which we measure against our goal, which is to be in the top 1% of hospitals in the country. All the employees know what will satisfy our customers and where our weaknesses lie, because they know the results of the patient-satisfaction survey. The second measurement looks at efficiency: how long patients are in their units per diagnosis. The third one is expense management: how well they're managing expenses. The fourth thing we're measuring this year is turnover. Everyone's got a turnover goal based on his or her unit and its past history.

Inc. : When you say everyone has a turn-over goal, does that include top managers as well?

Studer: Yes, our vice-presidents also have their own report cards and are measured on the same four categories as middle managers are. Twenty percent of my incentive compensation is based on employee turnover. That gets my attention.

Inc. : What sorts of things do you do to slow down the turnover?

Studer: We used the same sort of survey tool to measure employee satisfaction as we'd used to measure customer satisfaction. We found out that the biggest thing that bugged our employees was that their evaluations were late. They want feedback. Employees also want supervisors who accept their input with respect and appreciation. They want to know about matters that affect them. So we measured. And we set goals for where we wanted to be. We took all our leaders off-site and taught them how to present the survey data. Then we did 90-day work plans with employees, itemizing what we were going to change in the workplace to make it better. Then we measured again, and rewarded and recognized our accomplishments. I believe in strong rewards and recognition.

Inc. : What sort of rewards and recognition?

Studer: Every company has outstanding people. We make heroes of them. One of our nurses, Cyd Cadena, called up a lady who had been hospitalized to see how she was doing at home. She was in a wheelchair, and she was depressed because she didn't have a wheelchair ramp. The family was so busy working on home health care and a whole bunch of other things that they didn't get a chance to put in a ramp. Well, Cyd called our plant-management person, Don Swartz. And guess what Don did? He built a ramp. Don didn't ask, "Can I do it?" I found out about it because the patient called me. Now we tell that story all over the whole organization. What did we tell our people it was OK to do? Break a few rules. Take a few risks. Don is a star. You have to celebrate your legends.

Inc. : Tell us some of the other things that Baptist Hospital is doing to make it "the employer of choice."

Studer: Anybody who's ever been in a hospital knows we lose stuff. Patients complain about lost glasses, lost dentures, lost robes. And we ask dumb questions like "Are you sure you brought them with you?" "Are you sure your family doesn't have them?" "Why don't we wait and maybe they'll show up after discharge?" That leaves the employee dealing with a very unhappy patient, who doesn't get a check from us until three weeks after he or she has left the hospital. Today we have $250 available for any employee in the hospital to access on the spot to cover the cost of a patient's lost glasses or whatever.

We had a crazy rule in housekeeping that bugged the employees. Only our housekeepers were allowed to have housekeeping supplies. So if a nurse on a unit spilled something, and the unit coordinator or nurse wanted to clean it up, he or she couldn't. Instead, people spent 20 minutes saying, "Watch out! Don't step there. We've called housekeeping." Why weren't we allowing our staff to have housekeeping supplies in their unit? Trust. They might have taken them home. We didn't know we were this crazy until we started asking the employees what they needed.

Inc. : Any other advice for CEOs on getting employees to buy into their ideas for change?

Studer: Well, you have to really believe in what you're doing. When I got to Baptist, I said, "We're going to be the best hospital in the country," and somebody said, "Quint, you mean county." I said, "No, I mean country." You have to decide what you want to do, act on that decision, and look at the results. Then you get understanding. Sometimes we just have to get people to change their behavior and then they'll understand what we're after.

I'll give you an example. We have a rule at Baptist: We don't point. We think it's rude. We take people to where they're going. The other day I got a nice letter from a patient who said what impressed him the most was that when he walked into the hospital, somebody took him to where he needed to go. I don't know who it was, but whoever it was was a caregiver at that moment. Now, Bob Harriman, the VP of ambulatory care--he told me this later--thought it was a dumb idea. He didn't have time to guide people through the hospital. But I had to believe that if you actually take patients to where they need to go, it'll make a difference in how they view the hospital. We made the decision that's what we were going to do, and basically forced it for a while. The second time Harriman took someone to where that person was going, he understood and became a believer.

So sometimes we've just got to get people to do the behavior and then trust that they'll understand it afterward and become believers. You can get so hung up on getting everybody to understand what you're doing and why you're doing it that it never happens. Don't overworry about understanding. It will come, provided you act.