The prestigious Johns Hopkins Health System acquired All Children's Hospital in St. Petersburg, Florida, in 2011 (see: All Children's Hospital Joins Johns Hopkins Medicine). This was a non-cash transaction and the first U.S. hospital outside of the Baltimore/Washington, D.C., region to become integrated with JHM. As reported recently, this move has been the source of extreme embarrassment for Johns Hopkins as reported in a recent Tampa Bay Times article (see: Top All Children’s executives resign following Times report on heart surgeries). Below is an excerpt from it:
The CEO of Johns Hopkins All Children’s Hospital and two other hospital administrators have resigned following...an investigation that found dramatic increases in the hospital’s mortality rates for heart surgeries....In a statement, the health system said All Children’s CEO Dr. Jonathan Ellen, Vice President Jackie Crain and deputy director of the hospital’s Heart Institute Dr. Jeffrey Jacobs had resigned. Dr. Paul Colombani also stepped down as chair of the department of surgery....The...mortality rate at the hospital’s Heart Institute tripled between 2015 and 2017. Last year, it was the highest of any pediatric heart surgery program in Florida.....[T]he board of Johns Hopkins Medicine, which owns and operates All Children’s,...commissioned an external review of the issues within the heart program.....The...investigation reported that four physician assistants asked for a meeting with their supervisor and Colombani in 2015 to raise concerns about the surgeries performed by Jacobs and Dr. Tom Karl. At least four other employees also raised safety concerns....In June 2016, a third surgeon who had handled many of the most complex procedures was pushed out of the program.... Jacobs and Karl began performing all of the institute’s hardest surgeries. In the next 18 months, at least 11 children died after their procedures, even as the hospital began to turn away the most difficult cases....Kevin W. Sowers,..., president of the Johns Hopkins Health System and executive vice president of Johns Hopkins Medicine, will step in and lead the hospital in a temporary capacity while a plan for interim leadership is put into place.
One could say at this point that the Johns Hopkins strategy of acquiring a hospital outside of its home territory has been a major problem for the brand. The first idea that comes to my mind as an explanation of their problem is that "culture eats strategy," a phrase attributed to management guru Peter Drucker (see: Culture Eats Strategy For Breakfast. So What's For Lunch?). Here's a quote from this article:
...[B]oards appear to be paying only lip service to Drucker's tenet, according to a new survey by tax and accountancy firm Mazars....The study found that, despite culture being in the top three priorities for company boards, only 20% of 450 London-based directors and board members reported spending the time required to manage and improve it. Some 62% of survey respondents felt that they were primarily responsible for setting culture from the top of an organisation. However, a similar proportion (63%) either did not consider culture as part of their formal risk assessment or failed to routinely consider the risk associated with their corporate culture.
My guess is that the Johns Hopkins executives sitting in Baltimore assumed that their culture of hard work, high quality, and ethical behavior would be transmitted through the ether to their newly acquired pediatric hospital in St. Petersburg, Florida. They probably did not take the time and effort to manage and improve the local culture and are now paying the consequences for their actions in terms of a serious reputation hit. As noted above, "interim leadership" is being put into place but this will only be a temporary solution. A lot of building and damage control will be required.