3 minute read

The purpose of healthcare is to provide the highest level of care and the best possible outcomes for patients. However, the interests of staff, clinicians, executives, boards, and shareholders do not always align with that purpose. As a result, the decision-making process becomes unnecessarily convoluted and complex, taking organisations in the wrong direction or leading to analysis paralysis.

So, what’s the solution?
Organisations need to create processes that define the direction to take. This breaks the decision gridlock, enabling mental models and frameworks that lead to improvements in care and business outcomes. Effective decision-making is not widely taught. It requires wide-ranking skills, and a good level of knowledge about the problem to which a solution is required. To build those skills and gain that knowledge, it is critical to stop outsourcing your thinking. What do I mean? ’Outsourcing your thinking’ means believing that things need to be a certain way because that’s the way they’ve always been, or that it’s not possible to do something because it’s never been done before. This obscures the realities that can generate positive change.

How else can we avoid out-sourcing our thinking? We can remove the clutter created by competing interests, making it possible to recognise the truths of a situation. One of the key mental models that helps achieve this is ‘first principles thinking’. We use this commonly in healthcare for diagnosis. Breaking things down to their core components allows clarity of vision that shows what is, and isn’t, possible.

First Principles Thinking
In the words of Elon Musk, ‘Look at the fundamentals and construct your reasoning from that, and then you see if you have a conclusion that works or doesn’t work, and it may or may not be different from what people have done in the past’.

Building from the ground up using the core components enables decision-makers to work with the world, not against it. By finding the leverage point(s) it is possible for organisations to better focus their efforts and achieve more meaningful results. So, if there are objections to improvement based on cost, then by understanding where costs can be cut, or where long-term savings can be made, nullifies the objections.

Returning to Elon Musk, he stated that, ‘Somebody could say — and in fact people do — that battery packs are really expensive and that’s just the way they will always be because that’s the way they have been in the past. Historically, it costs $600 per kilowatt-hour. So the first principles would be, what are the material constituents of the batteries? What is the spot market value of the material constituents? It’s got cobalt, nickel, aluminium, carbon, and some polymers for separation, and a steel can. So break that down on a material basis; if we bought that on a London Metal Exchange, what would each of these things cost? Oh, jeez, it’s … $80 per kilowatt-hour. So, clearly, you just need to think of clever ways to take those materials and combine them into the shape of a battery cell, and you can have batteries that are much, much cheaper than anyone realizes.’

Starting with what is true, rather than working on beliefs and assumptions, is the foundation of good decision-making and progress. The kind of decision-making that creates change cannot rely on making ‘pros’ and ‘cons’ lists. It must be based on a deep understanding of the fundamentals.

Creating A Framework
These fundamentals can be used to create a stable, straightforward framework that enables decision-makers to exercise judgement, rather than ham-stringing them with rules and regulations. Rules and regulations may ultimately work against the needs of patients and organisations by prescribing certain actions in all circumstances. A framework, however, provides the outcome and rationale and helps to ensure that both requirements and outcomes are met.

Linking Change With Meaning
Trust in the process of change is essential. Decisions that affect healthcare workers and healthcare users need to be made for the right reasons. Mental models and frameworks that are founded on sound reasoning and strong ethics link change with meaning. As a result, cognitive biases and self-interest are reduced, or even removed from the equation.

This, in turn, opens up the pathways to successful innovation and transformation, positioning organisations out in front, keeping them relevant, reducing waste, increasing profits, and, most importantly, providing the highest level of care and the best possible outcomes for patients.

• Managing Culture, Chapter 3 –  https://ethics.org.au
• SMART People Make Terrible Decisions – https://fs.blog
• General Thinking Concepts –  https://fs.blog