REPUTATION MATTERS! Building, Sustaining and Crisis-Proofing Reputation and Market Share

REPUTATION MATTERS! Building, Sustaining and Crisis-Proofing Reputation and Market Share Lewton,Seekins&Trester (Kathy, Steve & Ken) 14th National Forum on Customer-Based Marketing Strategies February 4, 2009 Las Vegas

Reputation is real – so are crises!Both matter & can be managed • Today we’re going to look at: • How reputations are built, nurtured and managed • How a crisis can impact reputation • And how a strong reputation helps an organization survive a crisis First, a sampler of crises past and present. . .

Mt. Sinai New York 2002 “On top of the fiscal mess came the death of a man who had donated part of his liver in January 2002 . . . . .a state investigation found “woefully inadequate care . . . . Violations in 80 of 195 complaints patients had brought . . . . .The sum of it all has been a crisis of spirit.” “Today, most worrisome are the occupancy numbers.” New York Times

Tenet 2003 “Amid widespread media coverage, Tenet said patient volume had declined 20 to 30% since the start of the investigation.” Modern Healthcare

Duke 2003 “A Death at Duke “In the future, we can expect more publicity after major errors in medical care, especially when communication breaks down and trust is lost.” New England Journal of Medicine 3/20/03 “Ms Santillan’s plight also tarnished to some degree the reputation of one of the nation’s most renowned hospitals.” NY Times 2/22/03

And in just past six months . . . • $13.5 awarded in hospital death; Jury faults doctors at Dana-Farber (Boston Globe) • “Dana-Farber did not issue an apology” • Immigrants Facing Deportation by U.S. Hospitals (New York Times) • “Sister Margaret McBride, vice president for mission services at St. Joseph’s in Phoenix, which is part of Catholic Healthcare West, said families were rarely happy about the hospital’s decision to repatriate their relatives. But, she added, “We don’t require consent from the family.”

And . . . . . . • Top Psychiatrist Didn’t Report Drug Makers’ Pay (New York Times) • “Repeatedly assured by Dr. Nemeroff that he had not exceeded the limit, Emory did nothing.” And (truly) that just skims the surface

Reputation matters “If you lose money for the firm, I will be very understanding. If you lose reputation for the firm, I will be ruthless.” Warren Buffet To Salomon Brothers employees Warren Buffett to Salomon Brothers employees

Reputation has broad impact • Affects employee recruitment, retention, performance and morale • Ditto physicians, faculty • Drives donations, grants, alumni support • Attracts partnerships and alliances • Supports or undercuts promotional efforts to build market share (Good service/bad hospital vs halo) • Plays a role in decisions by managed care companies, foundations and more . . . . .

Reputation can be managed • Every organization HAS a reputation, even if no one knows what it is or tries to manage it • Reputations can be created and nurtured, repaired and restored, managed and monitored • And reputations can be damaged by poorly managed crises

The Reputation Equation Reputation = Perception Perception = Reality + Awareness Reality = E2 Personal Experience + Trusted Endorsements

In healthcare, E2 rules because reality reigns • Promotion aside, the truth is that reality (as interpreted by personal experience and trusted sources) dictates patients’ choice in healthcare • Latest Center for Studying Health System Change survey of 13,500 adults: • Choosing PCP: 50% F&F word of mouth, 38% MD recs • Choosing specialist: 69% PCP rec, 20% F&F, 18% another MD • Choosing hospital for procedure: 74% specialist rec, 14% another MD, 10% F&F • Promotion can build awareness and amplify the reputation, but it can’t override nor create reality

The HCO reputation management track record: C- • HCOs have the prerequisites for positive reputation given their lifesaving work • Always assumed favorable reputations as a “given” • Many did not actively work to sustain reputation based on performance • Many focused more on promotion • HCOs prone to crises • And many high profile crises have been handled badly • Tarnish has affected the entire category

Flash forward to 2009: • All health care, all the time – and clearly Obama intends to keep it front & center • Every sector is seen as a villain or potential villain (MDs, Rx, HMOs and yes, HCOs) • And we all provide enough fodder to make the concerns realistic • The transition from white hat to black hat continues (nurses are tarnish exempt) • And the public doesn’t know who or what to trust

This is significant because without trust . . . • The bond that is essential for human service organizations broken • The impact can be massive • From clinical outcomes • To philanthropic support • To over and re-regulation • To patients not trusting caregivers • So the time for reputation management and crisis protection is now!

A good reputationis like money in the bank • A solid reality-based reputation means the HCO has full account in the goodwill bank • So when crises occur, as they will and do, the HCO’s reputation destroyed • But if the goodwill bank is empty, damage can be lethal • Managing the crisis effectively will keep that reputation and the bank account intact • Alternatively, if the crisis is not managed effectively, even a big bank account can be overdrawn

A closer look at building and protecting reputation

Part One: Building a Reality-Based Reputation

Building & Burnishing Reputation:The Basics • An integrated process • Audience identification • Audience research • Message development • Key strategy: Building reputation via performance and relationships • With all of our customers, especially patients • With our employees • With our physicians • With the communities we serve

Reputation 1. A complex universe with many players Donors, grantors Prospective employees, faculty Consumers Employees Patients Management Families/ Visitors Faculty Media Government CustomerFocus Students Volunteers Community

And precisely because there are many players . . . . . • Managing reputation requires an integrated approach involving multiple functions: • PR • Marketing • Alumni • Development • Employee relations • Physician relations • And . . . . .

Integration does not meana single control point • It does require a collaborative, inclusive team approach • Get the right people at the table – someone has to make the first move • Focus on institutional objectives • Agree on master audience list • Use research data to: • Identify current communications channels • Identify appropriate messages • Shape strategies and tactics

AND then . . . . .Develop a comprehensive plan • With core messages • And messages tailored by audience • Clearly identified tactics, many that will reach multiple audiences • Implementation responsibilities based on expertise, experience and interest • And make this planning process part of the regular strategic plan process for the entire institution so that “they” buy-in

And execute (the plan, not each other) • Goal is to ensure no audience is overlooked or ignored • And that there’s no duplication of effort • Build in monitoring and benchmarking • Keep the team together to track, make mid-course corrections, evaluate, revise plan

2.Audiences: Who ARE those guys? • Before we can decide which audiences matter the MOST when it comes to building, enhancing a reputation, we first need the complete list • HCOs have a tendency to overlook some key audiences (or not even realize they exist) • Those audiences that are on the radar screen are often viewed too broadly, as large, homogenous groups (“physicians”), when in reality they are comprised of many subsegments

Employees Current, retirees, past, families Physicians Faculty, voluntary attendings, referrers, potential referrers Patients Current, former, families Governance Payors Medical students, residents, fellows Med school alums Donors, grantors Non-MD referral sources Media Community Civic, business leaders; neighbors, organizations Start with:

Volunteers Vendors UNIVERSITY Faculty, staff, students/families, alumni PETA et al KOLs nationally Associations “Consumers” Many may be part of another audience already and thus are getting your messages Important to consider differences between segments (age, ethnicity, income/ education, diagnosis, attitudes, healthstyles, gender) and when/how to segment even further (not all “women” share same concerns, issues, needs) And don’t forget:

While all audiences matter . . . . • Some are either lethal weapons or can be your advanced life support when it comes to reputation, especially in crises, because they speak from personal experience • Employees • Patients • Physicians • Employees • Patients • Employees • Physicians • Employees . . . . . .

Key audiences must not only knowyou . . . . . But also must love you (or at least like or respect you) • That means building relationships • And that process begins with understanding the audience • And that means research

3. Reputation planning research helps us discover: • Who are our stakeholders (audiences) that can impact or be impacted by our reputation? • What do they know and feel about us now? • What do we need to tell them to build awareness, credibility, support (message)? • How do we reach and motivate them (strategies and tactics)

Audience research is the core of reputation management • You can’t start creating messages without knowing what stakeholders • Know • Believe • Feel • Want/ don’t want • Need • Value

Once you have this data, you can do the classic gap analysis • Identify gaps between current and desired reputation • And set out to fill those gaps

Research has special rolein HCO setting . . . . . • Because the decision-makers are data driven (H1) • Because it provides a benchmark against which to measure • Because it provides a road map for each stakeholder group • What messages work, don’t work

And the core research program should also include: • Employee attitude/opinion studies • Ditto for physicians/faculty • Routine consumer awareness/preference benchmarks as well as major studies • Referring physician/provider surveys • Community/opinion leader perception audits • Multi-faceted patient satisfaction program And all of this data helps us develop MESSAGES!!!

4. Oh, yeah, the MESSAGE (we’ll get to that after we decide on ads vs. Twitter vs. stadium signage) • The reason many communications campaigns fail is simply because the message doesn’t work, for one of four basic reasons: • They don’t understand it (Comprehension) • They don’t believe it (Credibility) • They don’t care about it (Relevance) • It doesn’t touch their emotions (Resonance) • C2, R2

Comprehension – do they get it? • HCOs are huge abusers of jargon • Acronyms, science terms, insider info (Magnet) • And we pile on the FACTS, FACTS, FACTS • And we often rely on print channels when the “average” consumer audience includes: • Illiterates • Semi-literate • Anti-literate • Poor vision, hearing

Credibility – do they believe it? • Overpromising, directly or indirectly • Overendorsing • Overqualifying • Overhyping things that have no inherent credibility to the average consumer • Ratings, rankings • Awards • Credentials that are unintelligble to the consumer (FANA, FACHE, CRRRRRRT, etc.)

Relevance – does it matter to THEM? • Do they care about: • Service or product or procedure they figure they’ll never ever need or use • Who manufacturers anesthesia equipment • Lots of high tech terms • Hospital that’s two hours away • We, us, our . . . . . . . all about YOUR assets rather than their real-life needs and how they will benefit

Resonance – does it touch their feelings? • For a message to move audience to action, it has to touch heads and hearts • Real people with real stories • Showing rather than telling • Don’t be afraid of what we think of as the same old types of words and visual images IF they resonate with your audience

Only one way to ensure messages will work • Test, test, test • In your market(s) • With your target audienceS • With a talented moderator/interviewer who can play word games

An even closer look at reputation: performance & relationships

We must focus on performance • Reputation is built on reality (remember the equation) • And reality means how we perform, how we do our work, how we take care of and build relationships with our core stakeholders: patients, employees, physicians and community • Promotion is an important part of burnishing reputation because it builds awareness – but the foundation is performance • So marketing/PR must be integrally involved in organizational performance, not just relegated to promotion or communications

5. Key strategy: Building reputation via performance and relationships • With all of our customers, but especially patients • With our employees • With our physicians • With the communities we serve

Patient satisfaction(still a work in progress according to HCAPS) • Patients are “expert endorsers,” and their opinions are based on their experiences • Thus, their satisfaction is essential in terms of shaping reputation • Management of function requires group effort • PR/marketing should support/staff the function to ensure that data is translated into action • Requires coordination with all operating units – rarely does a problem have a single owner

Patient satisfaction is a mission, not a program • A question of culture • It starts with the “quest for excellence” • Quality care and optimal outcomes require satisfying patients. • There are strong correlations between patient satisfaction and clinical performance, and patient satisfaction and outcomes

REPUTATION MATTERS! Building, Sustaining and Crisis-Proofing Reputation and Market Share