For global businesses, extending their brand and their business on a global scale is a well-known, almost routine strategic process. When a brand is introduced in a new country, different cultural dynamics and business practices play a big role.
For example businesses need to carefully balance maintaining the brand’s core values and messages while adapting core processes and practices for local conditions. The key challenges for executives are how to leverage the strengths of their brand, avoid diluting their hard-earned reputations and make their business work in a totally different culture and environment.
In this final article, based on interviews with Cleveland Clinic CEO Toby Cosgrove, Dr. Cosgrove discusses the challenges and opportunities of exporting the Cleveland Clinic.
GLOBAL PARTNERS: What made you first believe a Cleveland Clinic in Abu Dhabi was a good idea?
DR. COSGROVE: The demand was clearly there. Patients have been coming to Cleveland Clinic from the Middle East for more than 40 years. Royalty, business leaders and ordinary people. By the early 2000s, we were doing about 35 heart operations a month on patients from the Middle East. My predecessor thought we could reduce these patients’ need to travel by meeting them halfway, in England. We considered buying a hospital in London and looked at several opportunities. But it soon became clear that it would be too difficult to do business in England. So we passed.
GLOBAL PARTNERS: What made Abu Dhabi attractive?
DR. COSGROVE: Before Abu Dhabi, we spent about a year and a half exploring a potential collaboration in Dubai, the Emirate next door. During that process, we were approached by Abu Dhabi and the Mudabala Development Corporation. They proposed a unique collaboration. We would share our medical and organizational expertise, and they would build a 5 million square foot, state-of-the-art medical center. They would also pay salaries and a management fee. The benefit was clear. We would be able to bring our model of medicine to a whole new population at no financial risk. At the same time, however, the project posed huge reputational and operational liabilities.
GLOBAL PARTNERS: What was most important from an operations and reputation standpoint?
DR. COSGROVE: From the operations standpoint, we were being asked to undertake a complete cultural transfer of our quality, safety and procedural standards. This isn’t something that happens overnight. So we negotiated a 15 year contract. This gives us time to develop a medical center that will benefit the people of this region for a long, long time.
From a reputational standpoint, we risked diluting the value of our brand and the equity we’d built up over 90 years of patient care. We couldn’t afford to put our name on anything that didn’t reflect the highest standards of medical excellence. Cleveland Clinic Abu Dhabi needed our DNA. Our solution was to put Cleveland Clinic people in all key leadership positions. They’ll be joined by some of the best physicians from all over the world. We will bring managers and administrators to Cleveland to learn and see how we do things. We’ve got around 200 of our people in Abu Dhabi now with the facility still under construction... within two years, we plan to ramp up to 3,000.
GLOBAL PARTNERS: This is an incredible brand odyssey. Can you tell us where the Cleveland Clinic goes next?
DR. COSGROVE: I can’t say, but nothing would be undertaken without careful diligence. We get an amazing number of requests for international partnerships; one from India last week, one from Korea, one from China. You know, there are very few things the world wants from the United States any more, but healthcare is one of them.
Below is a video of the five million square foot facility for the Cleveland Clinic in Abu Dhabi.
GLOBAL PARTNERS: When will that open?
DR. COSGROVE: Cleveland Clinic Abu Dhabi is now scheduled to open in late 2013.
GLOBAL PARTNERS: How will that be different from the Cleveland Clinic here in Weston, Florida, is it that same concept then, of staffing certain people then hiring locally?
DR. COSGROVE: It’ll be very similar to Cleveland Clinic Florida, Weston, where the demand for our services already exceeds capacity. Cleveland Clinic Abu Dhabi will be much bigger!
This article concludes our series on CEO Insights, featuring Dr. Toby Cosgrove. Throughout the series Dr. Cosgrove touched on topics that are clearly on his mind and undoubtedly on the minds of all Healthcare Executives.
As you think about his comments, consider the implications for your organization. Is your business focused on the challenges and issues that are most important to your key customers? Are all of your people who interact regularly with customers at all levels, not just CEOs, aware of what’s on the minds of their customer contacts? And perhaps most importantly, can they provide real value to their customers by helping them to address their most urgent challenges?
For further information on how to create a culture of Trusted Business Advisor contact us or visit our website. And be on the lookout for our e-book, CEO Insights, featuring Dr. Toby Cosgrove and future editions for our CEO Insights series.
Accountability is a key requirement for all organizations. However, healthcare companies and hospitals are more accountable than other industries because they have to improve not only revenue and profitability but patient outcomes as well. For nearly 20 years, Global Partners has worked with leading companies in healthcare and have experienced this challenge first hand.
This combined focus on business, operational and patient results has led to a new kind of healthcare model called Accountable Care Organizations (ACO), a type of payment and delivery reform that seeks to tie provider reimbursements to quality metrics and reductions in the total cost of care for an assigned population of patients.
ACO represents a unique opportunity for the healthcare providers and government to work in collaboration. In our third interview with Dr. Cosgrove, CEO of the Cleveland Clinic, we talk about how the Cleveland Clinic, a multispecialty academic medical center and one of the leading healthcare institutions in the world, sees ACO’s and their future in healthcare.
GLOBAL PARTNERS: We’re curious about your view of ACO developments, the viability of ACO’s and what the impact might be on the Cleveland Clinic and technology?
DR. COSGROVE: Are you talking about the Unicorn?
GLOBAL PARTNERS: You mean they may exist but I’ll believe it when I see it.
DR. COSGROVE: That’s right. The first iteration of ACO came from the government. It was modeled on a risk reward ratio. It was totally untenable. No one stood up and saluted it. There were a lot of comments back. After that, it took two years for the government to write what the definition of an ACO was. I don’t think they could change the payment system in the next two years, so that all of a sudden it happens every place. So I think we’re going to be sort of like we are with the electronic medical record. We’re sort of half way into electronic and half way still on paper. So I think the question really is timing and how you plan for an organization like this, how fast that you rollout something like an ACO.
GLOBAL PARTNERS: What will advance the ACO model?
DR. COSGROVE: What we’re really talking about is paying for healthcare in a different way then we have previously. And if that’s going to happen, 50% of that pay is going to have to come from the government.
GLOBAL PARTNERS: What are other key factors?
DR. COSGROVE: Accountable healthcare is the result of two major things - Pay less as a result of doing more monitoring. The Cleveland Clinic has a lot of quality metrics now. We report 65 metrics to the government and are expecting to report 85 in the next couple of years. So we are working very hard to take cost out of our system through better measurements and reporting.
GLOBAL PARTNERS: Do you have a time horizon for ACO’s to be a reality? When will we see the Unicorn?
DR. COSGROVE: You know, where it falls in the priorities is going to determine how fast we’re going to see it implemented. I think it’s really as simple as that.
Simple wisdom puts complex issues in perspective to create advancements within organizations. In our interview with Dr. Cosgrove, and in our work with leading companies trying to do business better and smarter in a rapidly changing global marketplace, we often see that achieving breakthrough advancements often comes down to determining where they fall in the organization’s priorities.
Whether you are in healthcare or another industry, we are interested to hear how you prioritize and address the complex issues in your organization.