Monday, June 8, 2009

Lessons on Leadership: Obama’s Health Care Strategy

The New York Times magazine had a terrific article by Matt Bai yesterday on how President Obama and his team are building momentum toward a new health care plan that he sees as the #1 priority for the Administration. Reading the piece I couldn’t help but be struck at the tactical steps being taken that are nothing short of brilliant. These same tactics are essential ingredients to effective implementation of complex strategies, in politics, in business, and in everyday life. Here’s a quick summary:

1. Understand, and Co-opt, Dominant Power Structures.

Organizations are not boxes on a chart. They are made of people who have power, like power, and use power. Outsiders, change agents, even CEOs, will almost certainly fail if they don’t appreciate this reality. From President Bush’s social security plan to President Clinton’s own health care tsunami, a strategy of imposing a solution on upper-level managers, or members of Congress, does not work.

2. Relationships Win.

President Obama and Chief of Staff Rahm Emmanuel have brought on board the Administration team a wide selection of talent with tremendous personal and professional connections to key members of Congress. Former chiefs of staff and long-time aides to key legislators come with long relationships, trust, and inside information on how things really work, skill-sets that are replaceable.

3. Symbolic Gestures Help.

President Obama would just “happen” to drop by when a Senator was meeting with one of his staff. Invites to the White House theatre, dinners, and other social occasions for members of Congress is standard practice (as is a careful accounting of who goes and how often).

4. Involving Key Players Builds Buy-In.

Rather than show up with a fait accompli, President Obama’s strategy is to lay out the vision for health care reform, and work directly with Congress in defining the specific parameters of what the reform will look like. By involving Congress in the details, they gain ownership, and are more likely to move forward with actual implementation.

5. Sell the Strategy.

One of the toughest lessons of management is that the best ideas don’t win. The “right” answer does not win. What wins is what can be passed, and implemented. Getting there means the CEO must sell the strategy to key constituencies. This is often one of the hardest lessons for MBA students to get. They are used to being right (that’s how you get into b-school to start with), but being right is not enough. You have to convince others that you are right. As Matt Bai of the New York Times points out, expect Obama to be very active in not only selling whatever health care reform plan emerges, but the very idea that some type of universal health care plan is a good thing.

18 comments:

  1. Great post Syd - and interestingly a former McKinsey partner, now a senior corporate executive, was telling me only yesterday about how he had only really grasped the truth of your points no.1 and no.5 once he was inside a "regular" company and hiring consultants to work for him...

    ReplyDelete
  2. Aleksey Tikhomirov atikhomirov1@aol.comAugust 7, 2009 at 3:36 PM

    A question (actually 2) to Prof. Finkelstein: In the 2003 ed of Why Smarts Execs Fail you describe the Johnson & Johnson's case with the Palmaz stents and the J&J's failure to respond to Guidant's entrance. You then suggest that it would be interesting to see if J&J has learned from its failure as the company was introducing a drug-eluting stent. So, looking at J&J over five years later, do you have any reflections on whether such learning has actually occured.

    2. When conducting interviews / research for this book what was your impression of the leadership style by the former J&J's CEO Ralph Larsen versus Guidant CEO Ronald Dollens?

    Thank you!

    Sincerely,

    Aleksey

    ReplyDelete
  3. Professor Finkelstein,


    Just wanted to say hello from one SYD to another!
    Great blog would hopefully we could chat sometime.


    Regards,


    SYD

    ReplyDelete
  4. And yet the health care plan has not succeeded in any aspect, save alienating mainstream America

    ReplyDelete
  5. You might be interested to read my article on this
    Change Lessons from Obama’s Mistakes in Health Care Reform at
    http://www.i-change.biz/blog/?p=2774

    ReplyDelete
  6. Hi


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  17. Mr Obama.....put down Mao's "little Red Book" and have one of your aides (there has to be one around that isn't packing our unpacking your suitcases from your latest "2012 Election Campaign" junket on Air Force One that costs the American Tax-Payer $187,000.00 of payday installment loans an hour to fly you to every po-dunk town across America that has at least one registered Democrat)....go out and get you a "Cliff Guide to the US Constituition".....you know the one that you "swore on a Bible (or was it a Koran) back.

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