Tag Archives: customers

Health Care – The bureaucratic sum of my parts

by Larry Grant

In the past year I’ve spent far too much time intimately involved with the health care system.  The really obvious pain, of course, is the insurance and payment system.  If you’ve got only one bill, or one provider, or you’re the only one covered by your insurer, it’s not a big deal to figure out what’s going on — who owes what to whom.  However, whenever it gets beyond that, you need a professional (or compliant spouse or offspring) to figure out the bills from the “not-a-bills,” etc.

Not so obvious, but it struck me the other day as a “blinding flash,” is the basic bureaucratic structure of the system.  Three of the main characteristics of a bureaucratic organization, straight out of the industrial age paradigm are specialization, hierarchical control, and the dependence on processes, rules and procedures. Bureaucracy works well in two basic conditions.  First, there is little or no change in what the processes/rules/procedures need to be applied to.  For example regulating food safety in an era when most of our food was produced domestically is different from today’s globalized food market.  Second, the specialized organizational structure has a good fit to the presenting problems a constituent faces. For example, if you live in a city or county where there is no “dead animal disposal” department, try to figure out which part of government is willing to help — public works? Roads? Animal control?

One of the most frequent criticisms of bureaucratic organizations, especially government, is that it is next to impossible to find the “right person” to talk to — i.e., being bounced from agency to agency, desk to desk, to find the right place to get the service you require.  Once you do find the right person or place, you can get great service.  However, if the service required does not fit well within the given organizational structure, then it may be literally impossible to get service without a “case manger” to help the uninitiated navigate the system. (Remember when Mr. Incredible tries to help the little old lady get the right form to the right person in the insurance agency?)

Over the first 60+ years of my life, I’ve gotten great service from the health care system.  But in the last year this system has had to deal with more than one of my systems — pulmonary, circulatory, urological, and things are not working so well.  In the last year, I have seen and been treated by some of the very best medical people in the country (maybe in the world) — internists, hospitalists, surgeons (of several types), cardiologists, pulmonologists, oncologists, urologists, radiologists.  They are great at dealing with their “thing.”  Their “thing,” however, is not me — it’s just part of me.

Like allopathic medical practice in general, the health system is focused on the disease, not the “customer.” (There, I said it again.) While the best businesses and government agencies have learned that focusing on the customer improves performance, in large measure, the health system does not. And I’m not even talking about the insane Diaspora between the health delivery system and the health payment system that our wise and wonderful leaders have concocted and I already kvetched about earlier.

The bottom line is that the current disease management system doesn’t focus on me, or you, or any other person. This suggests a way of thinking about solutions.

What do you think might be in the post-bureaucratic solution set? Hint: I’m off to the Mayo Clinic to see what they have to offer.

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The Attack of the Killer Tomatoes: Part II

by Larry Grant

Who are the customers of compliance or regulatory functions? Usually elected officials. To reinventors the customer is the primary intended beneficiary of a specific service (or product). In the case of regulatory functions the primary intended beneficiaries of the process are the citizens (or the “people,” as in “we the people”). In a representative democracy such as in the United States, the interests of the people are presumed to be held by the officials we elect.

This idea resonates with some and confuses others. We need to say a lot more about the idea of “customer” and “complier,” but since this started with “killer tomatoes” and government regulation, let’s start at the beginning.

The history of regulation (or, if you will, “government interference”) is pretty interesting. It certainly goes back to Roman times with the regulation of grain and slave markets. But “modern” regulatory practices come just after the dawn of the industrial revolution when the British government began to take an interest in factory and working conditions—especially in the mines. In the United States it was certain of the states (like Massachusetts) that established regulations around factory working conditions. It was only after the turn of the 19th century that the federal government got involved. The irony being that the greatest pressure for regulation of industrial practices came from big business as a means to increase the costs of smaller businesses and thus drive out competition.

As regulation (and regulatory government agencies) became more common a certain regulatory rhythm began. A crisis (real or imagined) creates a public outcry, a set of laws are passed, a new (or old) regulatory agency is obligated to interpret and enforce the laws by creating regulatory processes, which, if followed, will end the crisis and ensure that it will never happen again. Of course, like a river, which you can’t step into the same place twice, the same crisis in need of regulation rarely occurs. In this way there is both opportunity for new crises—begetting new laws, agencies, and rules, and, as true of any good bureaucracy, processes beget even more processes, interpretations, rules, and the experts who know them. Over time the only people who really know the rules—because it becomes part of their life-blood of profit, the real engine in the whole thing—are those who work in the regulated industries or markets. The regulatory agency and its agents are now long out of the crisis-driven public eye, and dependent on the regulated to understand the regulations and the processes they are intended to regulate. A former professor of mine viewed this as a classic example of the “symbolic uses of politics” where crisis begets action, action begets, quiescence, and quiescence begets in its turn cooption. In effect, the regulatory agency gets “captured” by those whom they are supposed to regulate.

One fundamental reason why this happens is confusion about who is the customer. At the most obvious level, it doesn’t make sense to say that the individuals and businesses are the primary intended beneficiaries of the regulation. Sure, they do benefit by being regulated, but it is we the citizens who are the primary intended beneficiaries. And most government workers know this in their bones.

Look at the Federal Aviation Administration mission and vision http://www.faa.gov/about/mission/:

Our mission is to provide the safest, most efficient aerospace system in the world. Our vision is to improve the safety and efficiency of aviation, while being responsive to our customers and accountable to the public.

Who do you think they believe to be their “customers?”

Attack of the killer tomatoes: Regulatory policy comes home

by Larry Grant

My daughter would not use ketchup on her hamburger this weekend because she saw that it was “tomato ketchup.”

I can’t help but notice how often the governmental regulatory process has come up recently—from toys, to food, to drugs, to financial markets, to accounting practices, to the airways, to just about anything and everything in our lives. It’s hard for a “reinventor” to ignore regulatory processes and practices, but our clients are extremely reluctant to take them on—until there is a crisis, and even then the wheels turn slowly (witness 9/11 and containerized cargo) and only down well-traveled bureaucratic roads.

How is a reinventor of government to approach this? That is the question. The stakes and incentives for both the regulator and the regulated are high. Agencies in a bureaucracy don’t like to solve problems that are their very reason for being, and the regulated, even though they rail against the regulatory paper storm are quite comfortable with the status quo. Who know what evil lurks in the shadows of change?

Paul Krugman, in his NYTimes column last Friday the 13th, highlights how some of our most, apparently, mundane regulatory functions of U.S. government affect everything from my household, to our foreign policy, to the stability of foreign governments (witness the demonstrations in Korea related to American beef). So even though the regulatory functions seem mundane, the stakes can be high – as I found out when my bypass surgery depended to a great extent on a drug that was found to be adulterated.

What is a reinventor to do with regulatory functions that don’t work – or don’t work the way we think they should?

As with just about any question concerning reinvention we begin with “who’s the customer?” That is, who is the primary intended beneficiary of any product or service – or regulatory function? The idea of “customer” makes many public servants uncomfortable – particularly when regulatory or other kinds of “control” functions are concerned. I find that this discomfort goes away when we point out that the “customer” is not always the person or group that you interact with regularly – like in a retail transaction.

It doesn’t make sense to call the recipient of a speeding ticket the customer of the “arresting” officer. This is because the primary intended beneficiary of the speeding ticket is not the speeder, it is the “public.” This is to say that it is in the public interest that we regulate traffic. The officer in this case delivers an obligation (in the form of a ticket) to the speeder.

This is quite common in government agencies. Sometimes the agency is delivering a service (such as welfare benefits), and sometime the agency is delivering an obligation (ensuring eligibility for the benefit). A reinventor makes a strong distinction between service functions and compliance functions, because their customers are very different. Service functions are generally delivering services (or benefits) directly to their customers. Compliance functions generally deliver obligations to the people they regularly deal with – we call them “compliers” so they are not confused with “customers.”

So what do you think? Who are the customers of these regulatory functions?