Time to turtle up?

Organizations commonly turtle up when the surroundings get hot. It’s hot now.

Equity markets swing wildly.[1] Industry titans take on water at the next presidential tweet. Public opinion polls suggest significant change will come to Washington and state capitals this November.[2] The speaker of the House is retiring and his predecessor just came out for weed.[3]  For health care industries and organizations in environments subject to legislation and regulation, it’s rough now.

Time to batten down the hatches and wait for the heat to subside?

No. Turtling up deadly. Health care industry stakeholders, built for present value and to succeed over the long term, manage risk far more wisely and build a stronger future when they plan and act consistent with sound strategy – when they stay engaged with their stakeholders, including governments.

That doesn’t mean the best leader is the most clairvoyant about short-term risks and change. What will the president tweet next? Who will win November elections? Which way will the markets go from one day to the next? A person so gifted at guessing short-term futures should drop her career and set up at the horse track.  The short term is not the game. The building for the long term is.

In the health care sector, and in regulation and legislation affecting it, there is plenty to know about the future without having to claim clairvoyance. And there is a clear course of action:

·       There will be government. It will contain legislators, staff, an executive, senior officials, regulators and program managers. Who are they? What do they know about your organization and its value?

·       There will be stakeholders. Outside government, present and future customers, investors, members, nongovernmental standard-setting bodies, boards, educational institutions, competitors and opponents, journals and media steadily move forward notwithstanding heavy whitewater in capitals. Again, who are they? What do they know about your organization and its value? Globally the population is aging.[4] In America it is also growing more diverse. Aging people are more likely to need care and services.[5] Your customers, your market, and your means of delivering value are all aging.

·       There will be cost and value pressure. Fiscal policy at national and state levels is pressing indebtedness to unprecedented levels[6] [7] while the economy is growing. Social insurance and health care remains the largest and fastest-growing major federal expenditure. Meanwhile at the state level health care growth continues crowding out state expenditures for public education, transportation and other services.

Amid all the earthquakes and cycles in policy shaping the health sector, ultimately the soundness of an organization’s strategy matters most.  In one of the most incisive publications on strategy I’ve read in a long time, Graham Kenny writes in Harvard Business Review:

"The key to strategy is that it’s the positioning of one business against others — GM against Ford and Toyota, for example. What exactly is positioning? It’s placement on the strategic factors relevant to each key stakeholder group.… An “objective” is something you’re trying to achieve — a marker of the success of the organization. At the other end of the spectrum is “action.” This occurs at the individual level….  “Strategy” takes place between these two at the organization level.[8]"

The means by which the strategy is planned and carried out are its people, investments, initiatives and operations. Its planned waypoints and evaluations shape course corrections.

Focusing on strategy also has the effect of simplifying the field of view with a major stakeholder type -- governments and branches of government at the federal, state and local levels.

·       Does the government contain people whose official actions shape supply or demand for your services? Then educate them. Some may change after November elections. The people you educated may go elsewhere in the food chain. It’s probably best that they’ve heard your story concisely directly from you. On whether political engagement is worth the risk, Larry Sabato, director of the Center for Politics at the University of Virginia, says, “Those who endorse early get goodies. Those who endorse late get good government.”[9]

·       Is there policy constraining efficiency or the growth of value? Then expertly develop and carry out a plan to change it – ideally with others whose interests align with yours.

·       Has your organization competitors or opponents? Make your plans mindful of their arguments and resources – and assume their voice is being heard by people with power to make decisions affecting you.

In the hot water, the turtle becomes soup. Don’t be a turtle.


Frank Talk is a product of Cardinal Waypoint LLC. You can have Cardinal Waypoint at work for you. Contact Cardinal Waypoint here.



[1] Chicago Board of Exchange’s VIX index is a common standard of equity market volatility. http://www.cboe.com/vix. As of April 18, 2018, it is running about twice its long-term average level.

[2] Fingerhut H. Why do people belong to a party? Negative views of the opposing party are a major factor. Pew Research Center, March 29, 2018. http://www.pewresearch.org/fact-tank/2018/03/29/why-do-people-belong-to-a-party-negative-views-of-the-opposing-party-are-a-major-factor/, retrieved 4/17/2018. At the national level, these findings help explain some of the intensity against the party in power during off-year election years such as 2018.

[3] Demby G. What John Boehner’s pivot on cannabis tells us about the legal weed boom. NPR, April 16, 2018. https://www.npr.org/sections/codeswitch/2018/04/16/602670537/what-john-boehners-pivot-on-cannabis-tells-us-about-the-legal-weed-boom, retrieved 4/17/2018.

[4] Bloom D, Canning D. Global demography: fact, force and future. SSRN, WDA-HSG Discussion Papier 2006-1. 2006, posted 7/12/2011. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1883686, retrieved 4/17/2018.

[5] Shrivastava SRBL et al. Health-care of elderly: determinants, needs an services. Intl J Prev Med 2013 Oct; 4(10): 1224-1225. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3843313/, retrieved 4/17/2018.

[6] Congressional Budget Office. The budget and economic outlook: 2018 to 2028. April 9, 2018. https://www.cbo.gov/publication/53651, retrieved 4/17/2018. Continued accumulation of trillion-dollar annual deficits will press debt held by the public to the highest share of GDP since World War II.

[7] Truth in Accounting. Financial state of the states, 2016. September 2017. https://www.truthinaccounting.org/library/doclib/FINAL-FSOS-BOOKLET.pdf, retrieved 4/17/2018. Unfunded state pension and other benefit obligations total more than $1.5 trillion currently.

[8] Kenny G. Your strategic plans probably aren’t strategic, or even plans. Harvard Business Review, April 6, 2018. https://hbr.org/2018/04/your-strategic-plans-probably-arent-strategic-or-even-plans, retrieved 4/10/2018.

[9] Sabato L. Notes on the state of politics. Larry Sabato’s Crystal Ball, April 17, 2007. http://www.centerforpolitics.org/crystalball/articles/ljs2007090601/?upm_export=print, retrieved 4/17/2018. Often repeated, this is the earliest reference I could find.