India's private hospitals are expanding aggressively to serve the increasing number of patients who are seeking an alternative to the country's underfunded state-run medical system. As the ranks of India's middle class swell, private healthcare systems will likely see opportunities to achieve unprecedented rates of growth. But there is a catch: Because these patients and their families pay most of their medical expenses out of pocket, private healthcare companies must tightly manage their costs to keep services affordable and to compete in rapidly expanding markets.
To meet the challenge, private hospitals have adopted various strategies to enhance operational efficiency, most of them related to technology or process improvement. Though such measures have brought success in the past, these gains are unlikely to withstand rising medical inflation rates for long.
One solution that most hospitals have overlooked is engaging their untapped reserves of human capital, and this oversight could prove harmful to their long-term growth. Engaged employees are involved in, enthusiastic about, and committed to their work -- and they can play a crucial role in helping hospitals deliver cost reductions and world-class healthcare.
Engagement in India needs critical care
India's workforce suffers from a lack of engaged employees in every industry -- a condition that has gone largely undiagnosed and untreated for too long. Gallup's State of the Global workplace report reveals that only 9% of the country's workers are engaged in their jobs, while 31% are actively disengaged.
The prognosis is not much brighter in the professional workers category, which includes India's doctors and nurses. Gallup found that fewer than one in five (17%) are engaged, while about one in 10 (12%) are actively disengaged -- meaning they regularly undermine their coworkers' and companies' best efforts. And the vast majority (71%) of professional workers in India are not engaged. In other words, they are not emotionally connected to their company and committed to its success.
These numbers may point to an endemic problem, but they also represent a unique opportunity for Indian healthcare systems looking for a strategy to fuel sustainable growth and build a clear competitive advantage. Employee engagement is essential to any organization's health. Gallup's extensive research has linked engagement to vital business performance outcomes, including productivity, profitability, absenteeism, customer metrics, and turnover.
Further, engagement can make a life-or-death difference in a healthcare setting. Gallup's findings indicate that nurse engagement levels are the No. 1 predictor of patient mortality variation across hospitals. Additionally, medical facilities in the top quartile of Gallup's global employee engagement database have 41% fewer safety incidents than those in the bottom quartile.
Engaged healthcare employees are more likely to take the personal initiative to develop money-saving innovations and to diligently tend to their patients' emotional and physical needs. By investing in employee engagement, private healthcare companies in India will not only lower their operating costs, but they will improve patient outcomes and attract more patients by consistently providing high-quality care.
Making the most of operational investments
Hospitals are people-centric organizations that depend heavily on employees' efforts to reach their objectives.
Hospitals are people-centric organizations that depend heavily on employees' efforts to reach their clinical, patient, operational, and financial objectives. Low staff engagement levels can negatively affect a hospital's ability to meet these objectives in ways that are not always easy to detect. These barriers can include weak doctor-patient relationships; increased patient readmission rates, which can occur when staff members prematurely discharge patients to decrease average length of stay (ALOS); an absence of empathy stemming from overreliance on technology to increase productivity; and a lack of nurse and physician collaboration that can lead to medical errors. Problems like these compound over time and can damage a hospital's brand as well as its bottom line.
Caregivers' roles are growing in importance as hospitals recognize that they must deliver an enhanced patient experience even as they seek to lower operating costs. Yet India's private hospitals are still more apt to invest in implementing new technology to improve payment and purchasing systems, governance, risk management, and quality assurance or process-driven initiatives such as Six Sigma and lean management. These initiatives may seem more clear-cut and easier to implement, but they will fall short unless hospitals also invest in measuring and managing their employees' emotional connection with the organization.
If operational efficiency alone were the key to success in healthcare, then all hospitals that implement similar initiatives would be equally successful. However, in spite of their similar systems and procedures, some hospitals achieve lower average patient care costs per discharge and better patient outcomes. The key differentiator that can make or break these operational investments is engaging India's healthcare professionals. With increasing pressure for higher efficiency and productivity, it is more important than ever for hospitals to take steps to improve their employees' engagement so that they can get the most out of their workforce every day.
Prescription for a high-performing healthcare system
Creating a culture of engagement is an effective strategy that can complement operational efficiency initiatives, technology upgrades, and other cost-cutting measures. Engaged employees are more likely to be involved in process improvement and to look for innovative ways to reduce costs and increase efficiencies than employees who are not engaged or who are actively disengaged. Few Indian hospitals, though, are actively measuring and managing staff engagement.
One exception is Apollo Hospitals, one of Asia's largest healthcare groups, which is using employee engagement as a force to drive patient engagement and clinical and financial outcomes. As Apollo looks to set new standards for increasing employees' performance levels and their emotional attachment to the workplace, it has worked with Gallup to create a three-part strategic road map for achieving transformative results.
1. Define employee engagement, and identify drivers of engagement for each employee category. Persistent, targeted attention on engagement at all workgroup levels leads to growth in any business. Employees' job categories and their age, gender, and educational levels can influence what they expect from their employers. Though executives often think they understand their workers' needs and motivations, they are nearly always surprised by what they discover when they begin asking the right questions.
Apollo Hospitals uses Gallup's Q12 employee engagement survey to identify the most important needs of each workgroup and to find ways to meet those needs effectively, keeping in mind that every role in the hospital counts. "Our leadership understands that consultants, nurses, paramedical staff, and others have different needs and expectations," says Jacob Jacob, chief people officer at Apollo Hospitals. "Therefore, we need to customize engagement strategies and policies for each group. For example, our nurses often leave their homes, live away from their families, and maintain a strenuous work schedule. This mandates a lot of support, training, mentoring, and recognition mechanisms to keep them engaged and connected in all respects."
2. Achieve strategic priorities by using Q12 results to create positive change. Each time an organization measures employee engagement, leaders and managers must follow up with systematic action planning on key priorities. Team-level action planning makes the priorities relevant for individual employees and workgroups. The company also must examine processes to see if they reflect employees' needs to create an environment of respect and trust. This examination might result in revamping processes related to onboarding, recognition, performance management, and development to align with the drivers of employee engagement.
3. Link engagement to organizational outcomes, and answer "What's in it for me?" for all employees. Sustainable change happens only when employee engagement becomes part of the culture -- and when employees trust that measurement and action planning help them perform better, learn, and grow. An engagement program that lacks a strong tie to clinical outcomes, the patient experience, and financial objectives won't prove its worth in investment dollars.
"Employee engagement should be a way of life at our hospitals," Jacob says. "It should be embedded in our strategy for excellence." Apollo's aim is to correlate employee engagement results with patient engagement outcomes, such as patient experience and safety; operational metrics, such as productivity and ALOS; and clinical metrics, such as medical errors and patient falls. Patient outcomes improve exponentially when engaged employees deliver better care and create engaged customers, thus leading to sustainable growth.
Real operational success comes from an organizational strategy that aligns and engages all key internal stakeholders -- leaders, physicians, managers/supervisors, and individual caregivers -- complementing investments in lean management, Six Sigma, and technology. Developing engagement doesn't require a significant capital investment. Simply removing barriers that interfere with an employee's work performance is an effective first step.
In complex, people-centric organizations such as hospitals, employee engagement can transform staff from cost drivers to revenue and profitability drivers. A focus on engagement can strengthen a hospital's unique culture and ensure that its people and processes are ready to adjust and change quickly as hospitals expand rapidly.