Achieving Integrated Governance: Navigating With ... · Case Study: Navigation System Upgrade 14...

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Achieving Integrated Governance:

Navigating With Excellence in Unpredictable Times

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Create Opportunities

The Strategic Importance of GovernanceYour Navigation System

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5 Critical Elements:

DOES YOUR NAVIGATION SYSTEM HAVE WHAT IT TAKES FOR SUCCESS?

AGILITYResponding

to Change

SPEEDSetting

thePace

PRECISIONHitting

theMark

ALTITUDEDriving

toInnovation

MORAL COMPASSLiving Your

Values

Authority > Decision-Making > Navigation

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Strategic Navigation Objectives

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“Technological change is positive, as it improves performance and opens up new opportunities”, said an operating partner at a Northeast-based PE firm.

“But when the pace of change is very fast, it can become challenging to adapt quickly enough to keep a business on track.”

“Steering the Ship”

Direction

“Running the Ship”

Performance

“Protecting the Ship”

Safety

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Strategic Navigation Systems

4

MONITORING Verification

MANAGEMENT Execution

BOARD Oversight

ClearMission

AlignedStrategy

ManagedRisk

StrongControls

OptimizingyourRISKMANAGEMENTEXECUTIONtoproducerisk-informeddecisions

IntegratingyourMONITORINGVERIFICATIONtodelivervitalinsights

ElevatingyourBOARDOVERSIGHTtoprovidestrategicguidance

A better, stronger, and more agile business navigation system will help your organization:

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Create Opportunities 5

Integrated GovernanceKey Governance Roles Within the Broader Governing (Navigation) System

Board Oversight Duties

Management Execution DutiesThe4“IntegrativeDuties”:IntegrativeDuty#1– ClearMission

IntegrativeDuty#2– AlignedStrategy

IntegrativeDuty#3– ManagedRisk

IntegrativeDuty#4– StrongControls

Fulfillingandstewardingthemission,visionandvirtuesethically.

Achievingthestrategyandoverseeingstrategicdirectionconsistentwithstrongcorporateresponsibility.

Drivingtheoperationsandoverseeingthedesiredriskappetiteandprofile,consistentwithestablishedrisktolerances.

Creatingtheeffectivecontrolsandoverseeingthecontrolenvironment,whileensuringconsistentcompliance.

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3 3

3

4 4

4

Monitoring Verification Duties

3

Mission, Vision & Virtues

Stewardship

Strategic

Direction

Control

Environment

Risk Appetite &

Profile

1

24

Mission, Vision &

Virtues

Strategy

Operations &

Risk Management

Controls

1

2

3

4

Ethical

Consistency

Strategic

Responsibility

Control

Compliance

Risk Tolerance

Adherence

1

2

3

4

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Integrated GovernanceStrategy Roles Within the Broader Governing System










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3

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4


3


Stewardship

Strategic

Direction

Control

Environment

Risk Appetite &

Profile

1

24

Mission, Vision &

Virtues

Strategy

Operations &

Risk Management

Controls

1

2

3

4

Ethical

Consistency

Strategic

Responsibility

Control

Compliance

Risk Tolerance

Adherence

1

2

3

4

Strategic Direction

Oversight

Strategy

ExecutionStrategic

Responsibility

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Integrated GovernanceRisk Roles Within the Broader Governing System










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3 3

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3


Stewardship

Strategic

Direction

Control

Environment

Risk Appetite &

Profile

1

24

Mission, Vision &

Virtues

Strategy

Operations &

Risk Management

Controls

1

2

3

4

Ethical

Consistency

Strategic

Responsibility

Control

Compliance

Risk Tolerance

Adherence

1

2

3

4

Risk Appetite &

Profile Oversight

Operations & Risk

Management ExecutionRisk Tolerance

Adherence

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Optimizing Board & Management Alignment

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Strategic Direction

Oversight

Strategy

Executionvs.

RoleClarity

InformationFlow

AlignedPerspectives

Decision Making

Agility & Resiliency

Achieving Effective:

Risk Appetite & Profile

Oversight

Operations & Risk

Management Executionvs.

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Case Study: Navigation System Upgrade

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Strategy Execution – Critical Access Hospital:

• Strategic Planning Processes Strengthened & Integrated

• Strategy & Risk Board Committee Established (strategic issues)

• Created a “Strategic Risk Lens” (for management and the board)

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Integrated GovernanceCreating an “Integrated Strategic Risk Lens” Within the Broader Governing System

External Ecosystem – Industry/Market/Customers

Your Organization

Strategic Plan

• Operations• Risk Management• Controls

STRATEGY RISK LENS #1:EcosystemPoorly Managed Leads To:Competitive Disadvantage

STRATEGY RISK LENS #2:AssumptionsPoorly Managed Leads To: Costly Surprises

STRATEGY RISK LENS #3:ExecutionPoorly Managed Leads To:Bad Performance

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Risk Management – Critical Access Hospital:

• Strategy & Risk Board Committee Established (risk issues)

• Meaningful Periodic Risk Assessment & Continuous Risk Management

RiskVitalSigns

• Risk Management Processes Strengthened & Integrated

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Integrated GovernanceRisk Management Integration Within the Broader Governing System










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3


Stewardship

Strategic

Direction

Control

Environment

Risk Appetite &

Profile

1

24

Mission, Vision &

Virtues

Strategy

Operations &

Risk Management

Controls

1

2

3

4

Ethical

Consistency

Strategic

Responsibility

Control

Compliance

Risk Tolerance

Adherence

1

2

3

4

Governance Level(Risk Decision-Making)

Strategic Level(Risk Portfolio-View)

Compliance Level(Detailed Risk Analysis)

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Integrated GovernanceGovernance Level (Risk Decision-Making)

RiskVitalSigns

©2016IntegratedGovernanceSolutions,LLCAllRightsReserved.

FoundationalFramework

Pillars

Elements

Key

RiskAccountabilities

RiskCapabilities

OrganizationalInterdependencies

RiskInterdependencies

RiskDecision-Making

RiskIdentification

RiskAssessment

RiskReporting

RiskMonitoring

RiskStrategies

OWNERSHIP

21

3

4

5

67

8

9

10

RiskPractices

Risk VitalSigns - Baseline Report - Aggregate ©2016 Integrated Governance Solutions, LLC All rights reserved 1

Assessment Result s: Summary

Governance VitalSignsLEGEND: ¿ = Average Rating

OWNERSHIP NOT PARTIALLY MOSTLY CONSISTENTLY OPTIMALLY

ACHIEVED ACHIEVED ACHIEVED ACHIEVED ACHIEVEDSCORE

Element 1.

Risk Accountabilities 7.80

Element 2.

Risk Capabilities 7.20

UNDERSTANDINGElement 3.

Risk Identification 6.60

Element 4.

Risk Assessment 5.60

EXECUTIONElement 5.

Risk Strategies 7.00

Element 6.

Risk Monitoring 5.80

COORDINATIONElement 7.

Risk Reporting 7.00

Element 8.

Risk Decision Making 7.00

INTEGRATIONElement 9.

Risk Interdependencies 5.80

Element 10.

Organizational Interdependencies 5.80

TOTAL SCORE: 65.60

54321

3.9

3.3

3.5

2.9

3.5

3.5

2.9

3.6

2.9

2.8

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14

Strategy/Risk Integration – Critical Access Hospital:

• Applied the Common Risk Language to the Strategic Plan and Prioritized Risk Types

• Linked Key Risks to Key Strategies and Developed Action Plans

• Developed a “Common Risk Language” to be shared by Management, the Board, and Monitoring

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Integrated GovernanceStrategy Level (Risk Portfolio View) – Common Risk Language

Strategic (S)

Operational (O)

Financial(F)

Human Capital(H)

Legal/ Regulatory

(L/R)

Technology(T)

Competition/Brand Identity

Demographic Shifts

Consumerism

Economic Climate

Healthcare Reform

Value-Based Care

Payer Relationships

Partnerships/ Affiliates

Donor Relations

Reputation

Capital Allocation

Care Delivery Strategies

Organization Structure

Strategy/Innovation

M&A

Care Delivery Network

Care Delivery Quality

Change Mgmt. –Operations

Emergency Management

Patient Safety

Process Quality

Process Execution

Resource Capacity/Allocation

Asset Utilization

Vendor/ Outsourcing

Facilities/Power Outage

Accounting/ Reporting

Asset Misappropriation

Bad Debt

Revenue Cycle Management

Budgeting/ Planning

Capital Structure

Liquidity/Credit

Payer Mix/ Reimbursement

Taxes

Change Readiness

Cultural Health

Employee Engagement

Performance Incentives

Physician Alignment

Skills/ Competency

Succession Planning

Diversity

Labor Shortage

Contracts

HIPAA

Malpractice Liability

Rating Agencies

RegulatoryEnvironment

Legal/Regulatory Compliance

Fraud & Abuse

Physician Compensation

Data Integrity

IT Infrastructure/ Architecture/ Transformation

IT Reliability/ Recovery

IT Security/Cyber-risk

Change Controls –IT

EMR – Access Controls

Bio-medical Equipment

Systems Implementation

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Integrated GovernanceStrategy Level (Risk Portfolio View) – Risk Application & Prioritization

Inh

ere

nt

Ris

k Im

pac

t (S

ign

ific

ance

)

Inherent Risk Probability (Likelihood)Low Moderate High

Low

Mo

der

ate

Hig

h

Competition/Brand Identity (S)Economic Climate (S)

Reputation (S)Organization Structure (S)Mergers & Acquisitions (S)Care Delivery Network (O)

Patient Safety (O)Capital Structure (F)Cultural Health (H)

Consumerism (S)Partnerships/Affiliates (S)

Strategy/Innovation (S)Healthcare Reform (S)

Value-Based Care/Payment Reform (S)Payer Relationships (S)Capital Allocation (S)

Revenue Cycle Management (F)Employee Engagement (H)

Physician Compensation (L/R)Data Integrity (T)

IT Infrastructure/Architecture/ Transformation (T)

IT Security/Cyber-risk (T) Systems Implementation (T)

Care Delivery Strategies (S)Care Delivery Quality (O)

Change Mgmt. – Operations (O)Process Quality (O)

Process Execution (O)Resource Capacity/Allocation (O)

Change Readiness (H)Physician Alignment (H)Skills/Competencies (H)

Labor Shortage (H)

Donor Relations (S) Demographic Shifts (S)Asset Utilization (O)

Vendor/Outsourcing (O)Budgeting/Planning (F)

Liquidity/Credit (F)Performance Incentives (H)

Succession Planning (H)Diversity (H)

Rating Agencies (L/R)Regulatory Environment (L/R)

Legal/Regulatory Compliance (L/R)

Payer Mix/Reimbursement (F)Contracts (L/R)

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Integrated GovernanceStrategy Level (Risk Portfolio View) – Risk to Strategy Linkage

X X X X X X

X X X X X X X X

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X X X X X X X

X X X X X X X X X

X X X X X X X

X X X X X

X X X X X X X X X X

X X X X X X X X X

X X X X X X

X X X X X

X X

X X X X X

X X X X X X

X X X

Care Delivery Strategies (S)

Care Delivery Quality (O)

Change Management-Operations (O)

Process Quality (O)

Process Execution (O)

Resource Capacity/ Allocation (O)

Change Readiness (H)

Physician Alignment (H)

Skills/ Competencies (H)

Labor Shortage(H)

1. Physician Recruitment (GROWTH)

2. Physician Retention (GROWTH)

3. Rural Cancer Center of Excellence (GROWTH)

4. Service Lines/Community Health(GROWTH)

5. Mental Health(GROWTH)

6. Consumer Expectations (SERVICE/QUALITY)

7. Community Perception (SERVICE/QUALITY)

8. Extended Care Enhancements(SERVICE/QUALITY)

9. Quality and Patient Experience(SERVICE/QUALITY)

14. Regional Healthcare Relationships(RELATIONSHIPS)

10. Physician Alignment(SERVICE/QUALITY)

16. System Relationships(RELATIONSHIPS)

12. LEAN / Studer(SERVICE/QUALITY)

15. Foundation(RELATIONSHIPS)

13. Employer of Choice(PEOPLE)

18. Master Facility Plan(FINANCIAL)

17. Financial Stability(FINANCIAL)

KEY STRATEGIESRevenue Cycle

Management (F)

11. Technology Transformation(SERVICE/QUALITY)

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Integrated GovernanceStrategy Level (Risk Portfolio View) – Risk Response Planning

CareDelivery

Strategies(S)

CareDelivery Quality

(O)

ChangeManagement-

Operations(O)

Process Quality

(O)

Process Execution

(O)

ResourceCapacity/ Allocation

(O)

Change Readiness

(H)

Physician Alignment

(H)

Skills/ Competencies

(H)

Labor Shortage

(H)1. Physician Recruitment (GROWTH)

Key Risk Specific Impact on Strategy Risk Response Plan Responsibility(Risk Owner)

Timeline/Milestones

Status

Care DeliveryStrategies (S)

How, where, and when can this risk affect this strategy?

What are we/will we do about it? Who is responsible?

By when?




By when?




By when?




By when?

Skills/ Competencies(H)



By when?

Labor Shortage (H)



By when?

RevenueCycle

Management(F)

X X X X X X

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Integrated GovernanceStrategy Level (Risk Portfolio View) – Board Dashboard

X X X X X X

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X X X X X X X X

X X X X X X X

X X X X X X X X X

X X X X X X X

X X X X X X X X X

X X X X X X X

X X X X X

X X X X X X X X X X

X X X X X X X X X

X X X X X X

X X X X X

X X

X X X X X

X X X X X X

X X X



Change Management-Operations (O)

Process Quality (O)





Skills/ Competencies (H)

Labor Shortage(H)






6. Consumer Expectations (SERVICE/QUALITY)

7. Community Perception (SERVICE/QUALITY)












Management (F)

11. Technology Transformation(SERVICE/QUALITY)

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Integrated Governance”Putting the Health Back Into Healthcare” – With Good Risk Management

Strategic

(S)Operational

(O)Financial

(F)Human Capital

(H)Legal/

Regulatory (L/R)

Technology

(T)

Competition/Brand Identity

Demographic Shifts

Consumerism

Economic Climate

Healthcare Reform

Value-Based Care

Payer Relationships

Partnerships/ Affiliates

Donor Relations

Reputation

Capital Allocation

Care Delivery Strategies

Organization Structure

Strategy/Innovation

M&A

Care Delivery Network

Care Delivery Quality

Change Mgmt. –Operations

Emergency Management

Patient Safety

Process Quality

Process Execution

Resource Capacity/Allocation

Asset Utilization

Vendor/ Outsourcing

Facilities/Power Outage

Accounting/ Reporting

Asset Misappropriation

Bad Debt

Revenue Cycle Management

Budgeting/ Planning

Capital Structure

Liquidity/Credit

Payer Mix/ Reimbursement

Taxes

Change Readiness

Cultural Health

Employee Engagement

Performance Incentives

Physician Alignment

Skills/ Competency

Succession Planning

Diversity

Labor Shortage

Contracts

HIPAA

Malpractice Liability

Rating Agencies

RegulatoryEnvironment

Legal/Regulatory Compliance

Fraud & Abuse

Physician Compensation

Data Integrity

IT Infrastructure/ Architecture/ Transformation

IT Reliability/ Recovery

IT Security/Cyber-risk

Change Controls –IT

EMR – Access Controls

Bio-medical Equipment

Systems Implementation

COMMON

LANGUAGE

Inh

ere

nt

Ris

k Im

pac

t (S

ign

ific

ance

)

Inherent Risk Probability (Likelihood)Low Moderate High

Low

Mo

de

rate

Hig

h

Competition/Brand Identity (S)Economic Climate (S)

Reputation (S)

Organization Structure (S)Mergers & Acquisitions (S)Care Delivery Network (O)

Patient Safety (O)Capital Structure (F)

Cultural Health (H)

Consumerism (S)Partnerships/Affiliates (S)Strategy/Innovation (S)

Healthcare Reform (S)Value-Based Care/Payment Reform (S)

Payer Relationships (S)Capital Allocation (S)

Revenue Cycle Management (F)

Employee Engagement (H)Physician Compensation (L/R)

Data Integrity (T)IT Infrastructure/Architecture/

Transformation (T)

IT Security/Cyber-risk (T) Systems Implementation (T)

Care Delivery Strategies (S)Care Delivery Quality (O)

Change Mgmt. – Operations (O)

Process Quality (O)Process Execution (O)

Resource Capacity/Allocation (O)Change Readiness (H)


Skills/Competencies (H)Labor Shortage (H)

Donor Relations (S) Demographic Shifts (S)Asset Utilization (O)

Vendor/Outsourcing (O)

Budgeting/Planning (F)Liquidity/Credit (F)

Performance Incentives (H)Succession Planning (H)

Diversity (H)

Rating Agencies (L/R)Regulatory Environment (L/R)

Legal/Regulatory Compliance (L/R)

Payer Mix/Reimbursement (F)Contracts (L/R)

PRIORITIZE

X X X X X X

X X X X X X X X

X X X X X X X X

X X X X X X X X

X X X X X X X

X X X X X X X X X

X X X X X X X

X X X X X X X X X

X X X X X X X

X X X X X

X X X X X X X X X X

X X X X X X X X X

X X X X X X

X X X X X

X X

X X X X X

X X X X X X

X X X



Change Management-

Operations (O)



Physician

Alignment (H)Skills/

Competencies (H)

Labor Shortage

(H)



3. Rural Cancer Center of Excellence

(GROWTH)



6. Consumer Expectations

(SERVICE/QUALITY)

7. Community Perception

(SERVICE/QUALITY)



14. Regional Healthcare Relationships

(RELATIONSHIPS)


16. System Relationships

(RELATIONSHIPS)

12. LEAN / Studer

(SERVICE/QUALITY)

15. Foundation

(RELATIONSHIPS)

13. Employer of Choice

(PEOPLE)

18. Master Facility Plan

(FINANCIAL)

17. Financial Stability

(FINANCIAL)


Management (F)

11. Technology Transformation

(SERVICE/QUALITY)

LINKAGE

CareDelivery

Strategies(S)

CareDelivery Quality

(O)

ChangeManagement-

Operations(O)

Process Quality

(O)

Process Execution

(O)

Resource

Capacity/ Allocation

(O)

Change Readiness

(H)

Physician Alignment

(H)

Skills/ Competencies

(H)

Labor Shortage

(H)1. Physician Recruitment (GROWTH)

Key Risk Specific Impact on Strategy Risk Response Plan Responsibility(Risk Owner)

Timeline/Milestones

Status

Care DeliveryStrategies (S)



By when?




By when?




By when?




By when?

Skills/ Competencies(H)



By when?

Labor Shortage (H)



By when?

RevenueCycle

Management(F)

X X X X X X

ACTION

PLANS

X X X X X X

X X X X X X X X

X X X X X X X X

X X X X X X X X

X X X X X X X

X X X X X X X X X

X X X X X X X

X X X X X X X X X

X X X X X X X

X X X X X

X X X X X X X X X X

X X X X X X X X X

X X X X X X

X X X X X

X X

X X X X X

X X X X X X

X X X



Change Management-

Operations (O)

Process

Quality (O)




Physician

Alignment (H)Skills/

Competencies (H)

Labor Shortage

(H)






6. Consumer Expectations

(SERVICE/QUALITY)

7. Community Perception

(SERVICE/QUALITY)












Management (F)

11. Technology Transformation

(SERVICE/QUALITY)

MONITORING/

REPORTING

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CLAconnect.com

Bill Bojan, DirectorBusiness Risk Services & Governance [email protected]

Achieving Integrated Governance: Navigating With ... · Case Study: Navigation System Upgrade 14...

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