Ownership Has Its Privileges

Posted on April 25, 2012

0


What does it mean to do business with the owner?

To me, dealing with an owner means you get “the  most” from any interaction:  customer service, honest communication, reliability, value, comprehensive attempt to resolve a concern or find a solution.

Ownership in healthcare has been one big revolving door:  physicians selling their practices, hospitals merging with systems, public companies going private.  Even hospitals and firms that appear stable can be secretly in turmoil.  Some consolidation is to be expected and welcomed in fragmented industries like healthcare and design and construction.  However, an ownership transition is difficult to quickly and easily execute, and it creates a great deal of quality control, management, leadership, client and financial uncertainty. And this ownership flux in healthcare is expected to continue for the next ten years.

I have lived and worked through a satellite office closing (corporate downsizing), and it is no picnic.  It is not fun to see how unstable the company entity and each individual employee becomes, and how that affects the work product.  Employee attrition creates massive task shifting and team reconfiguration.  Imagine what it looks and feels like from the client’s side—the concerns, worry, and doubts cast on their own project’s success.  Add in the dynamic of merging two or more corporate cultures, and the environment would only get more chaotic. And this is happening all over healthcare.

In such an unstable industry, healthcare providers might want to seek out additional stability in the teams they work with. The state of ownership at a potential consultant should be a significant consideration in who to do business with.  When you have a final three or four companies selected, why not delve into company ownership issues?  Ask who owns the firm and for how long.  Ask about financial stability and the tenure of the CEO.  Ask to meet him. 

Four years ago, Haskell was lucky to establish itself as an employee-owned company.  We have an employee stock ownership plan (ESOP), which is no gimmick.  As entrepreneurs often say, each one of us has ‘skin in the game’. Some private companies admire it and secretly hope they can get there someday.  An ESOP is like a family setting up a trust; it provides stability, protection, virtually ensures long-term survival of key assets, and allows the best opportunity for success.  In some ways an ESOP is a final evolution toward servant leadership, where each employee’s role is to help make everyone else’s job easier so we all benefit, especially clients.  ESOPs are not immune to ownership transitions away from self-ownership, but it is rare because statistically ESOPs are more stable businesses and historically outperform non-ESOPs in several areas.

Employee-ownership is not magic; however it solidifies one of the few competitive advantages left:  company culture. And while competitors and their employees are concerned with succession planning, or divestitures from mergers and acquisitions, Haskell can focus on its work.

As American Express advertisements were know to relate:  membership has its privileges. Well, ownership has even more. When selecting a firm to work with to design and build your next project, why not choose to work with an owner? 

Advertisements