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How to Make Remote Monitoring Tech Part of Everyday Health Care

Executive Summary

Remote patient monitoring is a subset of telehealth that involves the collection, transmission, evaluation, and communication of patient health data from electronic devices. These devices include wearable sensors, implanted equipment, and handheld instruments. During the pandemic, such monitoring programs have proven valuable. But special measures and conditions made that possible. By encouraging regulators to make permanent the temporary measures introduced during the pandemic and by following six guidelines to integrate these programs into health care, providers realize their tremendous promise.

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By making the collection of valuable patient data feasible outside of the clinic, remote monitoring can facilitate care for conditions ranging from chronic diseases to recovery from acute episodes of care. For years, it has been touted as one of the most promising opportunities for health care in the digital age. But the pandemic has underscored its value. Indeed, policy changes introduced during the pandemic due to the riskiness of in-person patient visits have created conditions ripe for its adoption. We urge regulators to extend these changes beyond the pandemic and for health care leaders to take advantage of this window of opportunity to develop, test, and improve remote-patient-monitoring programs.

What is remote patient monitoring? While “telehealth” broadly refers to all health care activities that are conducted through telecommunications technology, remote patient monitoring is a subset that involves the collection, transmission, evaluation, and communication of patient health data from electronic devices. These devices include wearable sensors, implanted equipment, and handheld instruments.

We define remote patient monitoring as the set of activities that meet four key criteria: (1) data on patients is collected remotely (e.g., in a home setting without oversight from a health care provider); (2) the data collected is transmitted to a health care provider in a different location; (3) the data is evaluated and care providers are notified, as needed; and (4) care providers communicate relevant data-driven insights and interventions to patients.

Remote Monitoring During the Pandemic

By making it possible to virtually perform medical activities that have traditionally been conducted in person, remote monitoring technologies have played a significant role in patient care during the Covid-19 pandemic. For example, providers such as Mount Sinai Health System in New York City, University Hospitals in Cleveland, Ohio, St. Luke’s University Health Network in Bethlehem, Pennsylvania, and Providence St. Joseph Health in Renton, Washington, started programs during the Covid-19 pandemic in order to monitor vital sign and symptom data and assess the status of coronavirus patients. Other hospitals, such as Mayo Clinic in Rochester, Minnesota, are working to set up remote patient monitoring programs for non-Covid-19 patients (e.g., as those with congestive heart failure).

New policies have recognized the importance of remote patient monitoring in this context. The U.S. Centers for Medicare and Medicaid Services expanded Medicare coverage for remote patient monitoring to include patients with acute conditions and new patients as well as existing patients. Moreover, the U.S. Food and Drug Administration issued a new policy allowing certain devices (FDA-approved non-invasive devices used to monitor vital signs) to be used in remote settings. Nonetheless, these changes remain temporary: They have only been authorized for the duration of the Covid-19 public health emergency. We hope that additional policies will be enacted to ensure that these programs can serve a variety of patients and conditions beyond the context of Covid-19.

Guidelines for Development and Implementation

These guidelines are drawn from our own experience managing remote-patient-monitoring programs, including one created specifically to care for Covid-19 patients, and research on the drivers of clinical success of established programs.

The technology must be easy for both patients and clinicians to adopt and continue using. It is essential to provide both patients and clinicians with intuitive equipment and user interfaces as well as resources for trouble-shooting when needed. Clinicians should be able to easily explain the equipment to patients, and it should be easy for patients to set up and use. The patient data generated by remote monitoring should also be simple to monitor and analyze.

This need is illustrated by a trial that studied remote monitoring of patients with congestive heart failure. In this trial, study physicians could not collect data for 12 out of 66 enrolled patients because these patients were unable to properly operate the mobile-phone-based monitoring device to begin data transmission.

The tools should be incorporated into clinician workflows. Given the high burden of administrative work that clinicians already face, it is imperative to introduce remote tools that blend seamlessly into their work processes. In some cases, this may require redesigning processes in order to ensure that remote monitoring is appropriately integrated into an organization’s practices.

For example, the administrators of a diabetes management program established at Massachusetts General Hospital found that they needed to modify the existing workflow for managing patients with diabetes in order to readily identify which patients required laboratory testing. Subsequently, the program built an application that remotely monitored diabetic patients and helped coordinate responsibilities for following up with patients about laboratory testing. This redesigned workflow improved efficiency by making it easier for nurse managers to remind patients about laboratory testing.

Sources of sustainable funding must be identified and tapped. This is especially critical at a time when hospitals are struggling financially due to the huge amount of revenue they have lost from pandemic-related cancellations and delays in performing surgeries and imaging.

Reimbursement for remote-patient-monitoring programs is challenging to navigate given that individual activities eligible for reimbursement — such as device set-up, patient education, interpretation of data, and follow-up patient conversations — are reimbursed separately. Nonetheless, reimbursement for such programs has improved with the advent of risk-based models of reimbursement such as Medicare Advantage plans and accountable care organizations, which offer providers increased flexibility in allocating capital to remote monitoring programs.

Many remote-patient-monitoring programs may have to rely on other sources of funding besides reimbursement, especially to fulfill upfront capital needs. In some instances, these sources of funding may be from the provider system’s operating budget. Internal innovation grants also may support programs. For instance, a diabetes remote monitoring program at Su Clinica Familiar, a federally qualified health center, was funded through a grant by the University of Texas System. Regardless of the nature of funding, we believe it is essential to identify a committed source of capital before establishing a remote-patient-monitoring program.

Dedicate sufficient non-physician staff to operate the program. A key reason this is necessary is that busy physicians will have difficulty carving out additional time to administer a program and sift through data. For example, Ochsner Medical Center in New Orleans developed a digital hypertension program staffed by pharmacists, who monitored 6,000 high-risk patients’ blood pressure readings remotely and followed up with patients via text and email. This program resulted in a significant increase in the proportion of patients who met their blood pressure goals.

As demonstrated by this example, it’s critical that staff in these roles are matched with the nature of the work. For instance, the complex tasks involved in hypertension-medication management might require a pharmacist or nurse as opposed to a patient navigator without clinical expertise.

Focus on digital health equity. Patients may appear to be better candidates for remote monitoring if they are younger, technologically savvy, or are fluent English-speakers. However, access to technology may be limited by poverty, and numerous other socio-demographic factors may influence engagement and participation in remote monitoring programs. At a time when the Covid-19 pandemic has disproportionately affected minority populations, care providers should go the extra mile to ensure that underserved patients not only have access to programs, but are also provided education and support needed to make them successful .

Start with an initial pilot and expand after demonstrated successes. Even in a pandemic setting in which time is of the essence, it is essential to demonstrate that remote patient monitoring initiatives improve clinical outcomes. Not all programs have demonstrated success, so the use of pilots can help avoid expensive mistakes. One successful program that scaled gradually is the Hospital of the University of Pennsylvania’s remote postpartum hypertension monitoring program. This program expanded from a small pilot to a larger clinical trial to the entire academic medical center based on evidence that it decreased admissions and costs associated with postpartum hypertension.

Covid-19 has created an opportunity to accelerate the adoption of remote patient monitoring as our health care system struggles to care for patients outside of the physical walls of a clinic or hospital. We encourage leaders to act decisively in establishing new programs by following best-in-class examples and guidelines. We believe that leaders who do so will spur a paradigm shift in how patient care is delivered that lasts far beyond the current crisis.

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Turn Your Covid-19 Solution into a Viable Business

Executive Summary

Many entrepreneurs have seized this moment as an opportunity to launch a social enterprise — businesses that have a dual mission of social impact and financial growth. But how can these entrepreneurs ensure that their short-term innovations can last as viable, long-term businesses? The author, a founder of a mission-driven company and a professor of social enterprise and global health at Emory University, offers four steps forward.

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As the challenges associated with the coronavirus pandemic mount, there is no shortage of innovative entrepreneurs who have stepped up to help. During March and April 2020 alone, virtual Covid-19-innovation competitions (aka hackathons) drew in tens of thousands of participants from 175 countries.

Further Reading

From the Atlanta high school student who started an organization delivering free meals to front line hospital workers, to a group of Colombian engineers building low-cost ventilators from scratch, innovators worldwide are creating novel solutions to the problems caused by the pandemic. And many are looking to turn their Covid-19 inspired innovations into sustainable businesses that will continue on past the immediate crisis.

As an entrepreneur who co-founded, built, and sold a mission-driven company, and a professor of social enterprise and global health at Emory University, I’d suggest that today’s Covid-19-inspired innovators take four key steps if they want to turn that project into a viable business for the long term.

1. Determine whether your innovation is addressing a long-term problem.

The best innovations are created in response to specific, urgent, and sizeable problems. In some ways, the Covid-19 crisis has made our most urgent problems and their potential solutions more obvious. For example: Health care providers needed masks; production facilities were idle; workers were furloughed and needed jobs. A social enterprise could address all three of these urgent problems simultaneously: Train workers to make masks in underused production facilities for health care providers.

But will this cluster of problems still need your solution three to five years from now?

Some coronavirus-inspired entrepreneurs are building on existing trends that have been amplified and accelerated by the pandemic, such as the explosive growth in telehealth, remote patient monitoring and the use of AI in health care. One MIT Covid-19 Challenge winner, for example, built a model to track the national distribution of critical medical supplies for hospitals in highest need. The efficient distribution of healthcare supplies is obviously an urgent problem today, but even beyond the current crisis, will be of value to healthcare systems that need to reduce waste and lower costs. On the other hand, some Covid-19 inspired organizations have been established in response to problems that are urgent and important today but are unlikely to be as critical once circumstances change. Free meal delivery services that were started to help health care workers may fall into this second category.

In order to determine whether your new product or service is addressing a long-term or short-term problem, I recommend that entrepreneurs start by looking to the past. Construct a market-opportunity analysis using data from 2019 and earlier. Was the problem you are addressing now a problem then? And, if so, how big was it? Next, list what specifically changed with the emergence of Covid-19 that created or amplified this problem and the need for your innovation.

For example, the need to care for patients from a distance, a problem solved by telehealth and remote-patient monitoring, certainly existed prior 2020. What changed with Covid-19 were the widespread stay-at-home orders, more widely available video and home-based technologies and, in the case of telehealth, changes in regulations and reimbursement, which, together, have led to a tremendous demand for these services.

2. Identify your long-term market.

The next step is projecting whether there will be a large, passionate market for your product or service in a post-Covid future. Research conducted by CB Insights prior to the pandemic found that a lack of market demand was the most common reason for failed startups’ demise, with 42% of companies citing it as a contributing cause.

I came close to becoming a member of the “failed-startup-founder club” myself 20 years ago when I relinquished tenure at a top university to co-found an early digital health company. Our mission was to build an online health resource for Latin America. Soon after we incorporated, however, we realized that there were only a couple million Spanish-speaking consumers online at the time — a market too small to build a viable business around. On top of that, we made another mistake common to rookie entrepreneurs: We were too focused on the technology, and not enough on the customer.

User-centered design has taught us that a key to building a lasting business is having a deep understanding of who your customers are and how your product or service fits into their world.

As a Covid-19 inspired entrepreneur, ask yourself two questions: Are you delivering an innovation that your customers are passionate about? And will there be a large enough number of these passionate customers to grow a business once coronavirus is under control?

3. Proactively pivot, if you need to.

If you determine that your current target market may not be large enough in a post-Covid future, you may need to pivot, like we did.

For the first five years of our company, we kept the lights on by selling translation and marketing services to U.S. hospital systems that served Hispanic patients, buying ourselves time until the market of Spanish-speakers passionate about health information eventually grew to half a billion people.

If it’s your turn for a strategic pivot, do whatever you can to pivot early, proactively, and thoughtfully. There are ample stories in the media these days of startups that are pivoting — but are doing so reactively in a frantic scramble for survival.

4. Map your business model.

Many of today’s Covid-19 inspired innovations are being given away for free, or are supported by donations, as is appropriate during an emergency. The leaders of these startups should be aware that contributions to non-profit organizations that are not Covid-19 centric are way down. Maintaining a donation-exclusive organization over the long-run in the face of today’s economic circumstances will likely be difficult.

Covid-19 inspired innovators should consider revenue models native to the field of social entrepreneurship. Social enterprises have a dual mission of social impact and financial growth and have developed an array of business models to achieve these parallel goals. For example, a Covid-19 inspired innovator in the U.K. is using the “buy one, give one” sales model to distribute the newly invented “hygienehook.”

Today’s entrepreneurs who are working on mapping their business model should also look to the past, when other economic disruptions similarly forced many companies to rethink their businesses. During the “great recession” of 2008, for example, Mark Johnson, Clayton Christensen, and Henning Kagermann presented a framework for reinventing your business model that is as relevant today as it was then. I suggest today’s entrepreneurs use this framework to define their company’s customer value proposition (CVP), profit formula, and the key resources and processes needed to deliver the offering as they navigate a future that is likely to demand novel solutions for some time to come.

The Covid-19 pandemic has clearly confirmed the maxim that crisis breeds innovation and opportunity. We have been reminded that WWII yielded the first programmable digital computers as well as unexpected discoveries like super glue.
It is unclear at this time which of the tens of thousands of Covid-19 inspired entrepreneurs are creating products and services that will succeed in the long-term, but by going through these steps, more of today’s innovations will be the ones that people are using years and decades from now.

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Sponsoring a Protégé — Remotely

Executive Summary

Career development doesn’t stop, just because we’re working remotely. To retain and fully realize the brightest and the best — and to secure the current and future success of your organization — managers and executives must prioritize sponsorship. They need to figure out how to continue to invest in a small, diverse portfolio of high performers using virtual tools and tactics.

First, make the relationship reciprocal. Encourage your protégé to pitch in to ensure team success, and ask them to create an inventory of their assets. Next, demonstrate commitment to your protégé by talking them up and suggesting them for opportunities. Introduce them at the start of key projects and highlight their strengths. Finally, emphasize gravitas in one-on-one meetings. Look to remote coaches or have targeted coaching via video chat.

Illustration by Artbyrobel/Robel Assefa

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For the past three months, executives have scrambled to manage through the ongoing crisis. Many have found creative ways to lead teams and listen to clients and customers in a world where face-to-face contact is impossible.

Despite the transition to remote work and economic uncertainty, career development doesn’t stop. It’s important to meet the needs of top junior talent looking to ensure careers aren’t stalled. Remember that young stars are mobile — in 2002 and again in 2008, it was the top producers on Wall St. and on Main St. that were lured away by competitors eager to show them more “love” through leadership development opportunities as well as higher salaries. In sharp contrast, poor performers tended to stick around. They had nowhere else to go.

Further Reading

To retain and fully realize the brightest and the best — and to secure the current and future success of your organization — managers and executives must prioritize sponsorship. They need to figure out how to continue to invest in a small, diverse portfolio of high performers using virtual tools and tactics.

The value of winning a sponsor is well known: A junior manager with a sponsor is 21% more likely than a junior manager without a sponsor to progress to the next rung of the career ladder. The other side of the relationship is just as promising: A manager or executive with a protégé is 53% more likely than a manager or executive without to progress to the next rung of the career ladder.

But the benefits aren’t just at the individual level. According to research by the Center of Talent Innovation, when at least a third of managers and executives proactively invest in a small portfolio of diverse protégés that include at least two individuals who are of a different identity — which happens in only 22% of companies — that company is 45% more likely to see improvement in market share and 70% more likely to capture a new market. This research traces the precise link between diversity and innovation and is a rich source for both data and case studies.

Whether you are an up-and-coming talent or an established leader, becoming a sponsor and having a protégé are great investments for individuals and companies, and these relationships can be built successfully, even in virtual working environments. Here’s how.

Make It Reciprocal

A protégé needs to give as well as get. This exchange of value and respect reflects the foundational premise of sponsorship. The biggest shift for a manager moving from being a mentor to being a sponsor is taking on board and actualizing this two-way street.

Sponsors value high performing junior talent who leave their ego at the door. In mid-2020 when so many business models are under stress, it’s particularly important for a protégé to pitch in and do whatever it takes to enable the team to hit a target or deadline. Putting up your hand to fix a tech snafu, or proactively reaching out via phone or Zoom to soothe a needy stakeholder, will improve your stock and standing.

A high-performing junior talent often has skillsets or life experiences that are not known to a sponsor. This is particularly true when the sponsor/protégé relationship crosses lines of gender, ethnicity, or any other line of difference. An efficient tactic here for a time-starved sponsor (and most managers are overloaded in these difficult times) is to ask your pick to create a one-page detailed inventory of their assets. This will allow you to better visualize the value being brought to the table. Ask your protégé to stress skillsets and experiences that are not currently on offer in the team, and make sure to include contacts and networks outside of work in the wider business world. This tactic is particularly helpful to sponsors who want to have a line of sight into potential of a junior talent of a different identity, someone who is not a “mini-me.” An inventory of assets often includes military service and not-for-profit leadership roles, as well as more predictable elements such as a language skill or global experience.

Demonstrate Commitment

Sponsors demonstrate full commitment to a protégé when they “use up a chip” on behalf of the junior talent. Reach out to a senior colleague or an important client (via phone or Zoom), talk up the impressive skill sets of your protégé, then make a watertight case for why they should be considered for a specific big opportunity. Vigorous advocacy is made easier if you have an inventory of your protégé’s assets in hand.

Alternatively, identify a project that your protégé may not have been included in prior to remote work and invite them to participate. As the project kicks off, make sure to introduce your protégé with respect and enthusiasm (perhaps in the first conference call) lifting up key strengths and outlining the value add this bringing to bear. Again, having an inventory of your protégé’s assets at hand is enormously useful.

Emphasize Gravitas in One-on-one Meetings

No matter how high performing, most protégé need to grow their soft skills. Top of list is learning how to project gravitas — how does a junior talent convey that they know their stuff cold? Working from home precludes modeling leadership behavior in person, but sponsors are becoming inventive, leaning on external resources (a remote media coach can be a life saver for protégé facing a high stakes virtual presentation) and plunging in themselves with 30-minute targeted coaching via video chat. Over the last few months we’ve interviewed executives across a range of sectors, including finance, tech, and media, and found out what dimensions of the gravitas they zero in on most frequently in their virtual coaching sessions. Among the top traits are decisiveness, authenticity, confidence, likability, poise, grace under fire, and vision.

Of course, successful sponsors focus on tone as well as tactics when investing in protégés. Conveying respect for junior talent whatever their background or identity, demonstrating sensitivity, and communicating informed empathy are critical behaviors for any manager seeking to sponsor a portfolio of diverse talent because these behaviors engender trust — a foundation stone of reciprocal, fully aligned sponsorship relationships. These issues of tone and trust are particularly important in a time when the country faces mounting racial and equal opportunity challenges. Sponsors are well advised to put these values center stage.

Creating or continuing a trust-filled, mutually beneficial sponsorship relationship is difficult in a remote setting — but it is possible. A manager or executive needs to be much more self-conscious about how to celebrate a protégé, even as they engage more in a conference calls or virtual meetings, where face-to-face options aren’t available. One senior executive gave us this golden rule: “Place the word respect in the center of your brain, and the details of inclusive interaction in cyberspace will fall into line.”

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What to Say When Someone Cries at Work

Executive Summary

When someone cries at work, showing curiosity and compassion, even if you’re uncomfortable, is core to being an emotionally intelligent leader. What should you say to someone who’s crying at work? Try something like: “Let’s pause for a moment here. I can see you’re crying. Would you like to take a break or keep going? It’s up to you.”  This is neutral language that gives someone the opportunity to choose what they want and need next. Or, say: “I’m going to stop our conversation for a second to check in with you. Can you tell me what’s going on for you right now?” This demonstrates compassion and curiosity for the person, without dramatizing or overplaying concern. Or, try: “You’re crying, so let’s pause. What would be most helpful for you right now? I’ll follow your lead.”  This acknowledges what’s happening, while empowering the person to take control.

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I was recently coaching a leader who asked me, “Is it OK for me to tell someone on my team that they can’t cry at work?” Normally, as a coach, I would respond to her question with a question of my own:

“What makes you ask that?”

“What about crying feels like it shouldn’t happen at work?”

“What might the impact be of telling them that they can’t cry at work?”

But instead of taking a coaching approach, I responded instinctively and firmly, “No.”

We know from Tom Hanks in A League of Their Own that “there’s no crying in baseball,” but no movie that I’ve watched has given us a clear answer on what to do about crying at work. And there is crying at work — whether we like it or not. It may be the result of a feedback conversation that feels hard, a career planning session that’s disappointing, a difficult conversation about unrealistic expectations, or it may even seem like it comes out of nowhere. And for many of us, seeing someone cry can make us feel uncomfortable, guilty, and anxious. Why do we have that reaction? For several reasons:

  1. Because we want to fix it. When we see someone crying, most of us have a natural instinct to want to problem-solve. And we don’t always know what the problem is that needs fixing.
  2. Because we worry that we caused it. We ask ourselves, “Was it something I said?” “Was it something I did?” “Did I make them cry?”
  3. Because we don’t know why they’re crying. The simplest interpretation is that they’re sad. But people also cry when they feel angry, happy, embarrassed, anxious, relieved, scared, frustrated, understood, tired, appreciated, hungry, lonely, etc.
  4. Because we don’t want to cry. Emotions are contagious, and we’re concerned that someone else’s tears might trigger our own — especially if we are particularly empathetic.
  5. Because we’re anxious that crying signals a bigger issue — and then what? We wonder if the crying is about something bigger than the conversation we just had. What if it signals a deeper personal issue — one that’s bigger than we know how to help?
  6. Because we fear that the crying will escalate. As soon as we see that first tear or hear that initial sniffle, we think to ourselves, “What if they start sobbing?” “What if they throw up?” “What if they start hyperventilating?”

Helping someone who is crying at work takes emotional intelligence, especially in the form of self-awareness and self-management. Self-awareness requires that we recognize that someone else’s emotional expression is having an impact on us, and are able to articulate what that impact is (fear, concern, anger, etc.). Self-management requires that we control our emotions in the moment, and adapt to what’s needed right now.

And what’s needed right now, in most cases, is for you to say something helpful, supportive, and brief. What isn’t needed?

  • Interpreting, such as “you seem sad.” Remember that people cry for a variety of reasons, and you can’t know why they’re crying unless they tell you. (It’s also important to keep in mind that people don’t always know why they’re crying themselves.)
  • Telling them what to do, such as “you should take a break.” When someone is crying, they often feel a loss of control. Dictating their next action, even when done from a place of compassion, can further rob someone of their sense of control.
  • Judging them, such as “it’s not worth crying about.” Telling someone not to feel how they’re feeling reduces interpersonal trust, making people feel unsafe in their relationship with you.

So what can you say instead?

  • “Let’s pause for a moment here. I can see you’re crying. Would you like to take a break or keep going? It’s up to you.”  This is neutral language that gives someone the opportunity to choose what they want and need next.
  • “I’m going to stop our conversation for a second to check in with you. Can you tell me what’s going on for you right now?” This demonstrates compassion and curiosity for the person, without dramatizing or overplaying concern.
  • “You’re crying, so let’s pause. What would be most helpful for you right now? I’ll follow your lead.” This acknowledges what’s happening, while empowering the person to take control.

Emotions are data, and the visible (and audible) expression of emotions, like crying, shouldn’t be ignored or minimized. Showing curiosity and compassion, even if you’re uncomfortable, is core to being an emotionally intelligent leader.

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How One Boston Hospital Built a Covid-19 Forecasting System

Executive Summary

Faced with the Covid-19 pandemic, the healthcare delivery infrastructure in much of the United States has faced the equivalent of an impending hurricane but without a national weather service to warn us where and when it will hit, and how hard. To build a forecasting model that works at the local level, the Beth Israel Deaconess Medical Center relied on an embedded research group, the Center for Healthcare Delivery Science, that reports to the CMO and is dedicated to applying rigorous research methods to study healthcare delivery questions

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The Covid-19 pandemic created an unprecedented strain on healthcare systems across the globe. Beyond the clinical, financial, and emotional impact of this crisis, the logistical implications have been daunting, with crippled supply chains, diminished capacity for elective procedures and outpatient care, and a vulnerable labor force. Among the most challenging aspects of the pandemic has been predicting its spread. The healthcare delivery infrastructure in much of the United States has faced the equivalent of an impending hurricane but without a national weather service to warn us where and when it will hit, and how hard.

To build a forecasting model that works at the local level – within a hospital’s service area, for example — the Beth Israel Deaconess Medical Center (BIDMC), relied on an embedded research group, the Center for Healthcare Delivery Science, that reports to the CMO and is dedicated to applying rigorous research methods to study healthcare delivery questions. We used a series of methods derived from epidemiology, machine learning, and causal inference, to take a locally focused approach to predicting the timing and magnitude of Covid-19 clinical demands for our hospital. This forecasting serves as an example of a new opportunity in healthcare operations that is particularly useful in times of extreme uncertainty.

Insight Center

In early February, as the U.S. was grappling with the rapid spread of SARS-COV-2, the virus that causes Covid-19, the healthcare community in Boston began to brace for the months ahead. Later that month, participants in a biotechnology conference and other residents returning from overseas travel were diagnosed with the new disease.

It was the start of a public health emergency. To understand how to respond, our hospital needed a Covid-warning system, just as coastal towns need hurricane warning systems. Our hospital is an academic medical center with over 670 licensed beds, of which 77 are intensive care beds. We knew it was hurricane season, but when would the storm arrive, and how hard would it hit? We were uncertain about what lay ahead.

Hurricane season — but where is the storm?

Lesson 1: National forecasting models broke down when predicting hospital capacity for Covid-19 patients because no local variables were included.

Our institution turned first to national models. The most widely used national model applied curve-fitting methods (which draw a best-fit curve on a series of data points) on earlier Covid-19 data from other countries to predict future developments in the United States. National models did not consider local hospital decision-making or local-level socioeconomic factors which dramatically impact key variables like population density, pre-existing health status, and reliance on public transportation. For example, social media data showed many student-dense neighborhoods in Boston emptying after colleges canceled in-person classes at the beginning of March, which meant fewer people were in Boston to contract the virus. Another critical variable in hospital capacity forecasting, the rate of hospitalization for people with Covid-19, varied as the weeks went on, even though national models held this variable constant. For example, early on our hospital was choosing to admit rather than send home many SARS-COV-2 positive patients, even with mild infections, because the clinical trajectory of the disease was so uncertain. Thus we needed a dynamic hyper-local model.

Building our storm alert system

Lesson 2: Local infection modeling required a range of different research methods, and the trust and commitment of operational leaders who recognized the value of the work.

The hospital turned to our research center to achieve these goals. The center, which is embedded in the hospital and reports to the Chief Medical Officer (Dr. Weiss), brought applied machine learning and epidemiological approaches to construct a hyper-local alert system.

Further Reading

To demonstrate the feasibility of forecasting local hospital-capacity needs for managing Covid-19 patients, we built a preliminary SIR model (a traditional epidemiological framework that models the number of Susceptible, Infected and Recovered people in a population), which was integrated into our institution’s incident command structure, an ad hoc team created with members of the hospital and disaster management leadership to respond to the pandemic. However, the accuracy of SIR models depends on the accuracy of estimates of disease characteristics such as incubation time, infectious period, and transmissibility, variables that are still not well understood. Therefore, we turned to machine learning approaches, harnessing real-time data from our electronic medical record to determine these variables directly from real patients. We also gathered Covid-patient census data from multiple hospitals simultaneously, using a common machine-learning technique called multi-task learning to capitalize on limited data. These methods allowed us to estimate when the demand for hospital capacity to treat Covid-19 patients would peak and plateau — predicting the timing to within five days of the true peak and more accurately modeling the slope of the peak and decline than national models did.

Had leadership relied on national models, they would have expected a sharper peak and decline, and a peak two weeks earlier than the actual peak. Our modeling affected key decisions, including the need to bolster personal protective equipment (PPE) supplies; to gauge the necessity of even urgent procedures, and postpone them if necessary in order assure we had the capacity to absorb the peak; and to establish staffing schedules that continued farther into the future than those originally planned.

Predicting the next hurricane

Lesson 3: Effective modeling in confusing times may require rapidly developing new methods for predicting the next storm.  

Hospitals now face a difficult challenge. We need to open our doors to the patients without Covid-19 who didn’t seek care or whose care was deferred. But how do we make sure to have enough protective equipment for safely bringing back outpatient procedures? And when can nurses who had been redeployed to our ICUs return to the floors and interventional areas such as the endoscopy suite and cardiac catheterization lab? Complicating these questions is whether we will see another rise in infections with changes in state-wide policies, reopening of schools and businesses, or a coming influenza season.

In this new phase, we now need to develop methods for understanding how people will move within a community (going to school and visiting stores, for instance) and how much they will interact with one another and, therefore, affect the risk of infection over time. To this end, we constructed a risk index for local businesses by comparing pre-pandemic traffic to traffic as they reopen, and whether they are indoors or partly or entirely outdoors. Businesses where visitors are densely packed in indoor spaces, especially for longer periods, have a higher risk index — meaning they are more likely to be the site of infection spread. Using our risk index, we created and validated a model for identifying such potential “super-spreader” businesses in our service area. This analysis is part of another body of research that will undergo peer review and publication and, therefore, its results are provisional. Meanwhile, we can use our work with businesses to further inform our forecasting model by examining traffic in business locations we have identified as high-risk and assessing whether incorporating these data improves the ability of our model to predict the demand on hospital capacity.

Integrating rigorous research methods into hospital operations

Lesson 4: Given the profound future uncertainty in healthcare, small investments in trusted internal research groups that can answer operational questions with new methods can yield substantial returns.

Our institution made a prescient investment in creating an embedded and trusted research group made up of clinicians, economists, and epidemiologists studying healthcare operations. The team has brought specialized machine learning methods and expertise in extracting conclusions from messy data to quickly and accurately solve emerging real-world problems — capabilities that traditional business analytics groups are less likely to have. Other organizations can similarly unite the rigor and flexibility of methodological experts with the need to rapidly answer operational questions in dynamic and even chaotic environments.

The authors would like to thank Manu Tandon, Venkat Jegadeesan, Lawrence Markson, Tenzin Dechen, Karla Pollick and Joseph Wright for their valuable contributions to this work. 

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Have Your Privacy Policies Kept Up with Your Digital Transformation?

Executive Summary

For every business that shifts operations online, there are potential privacy pitfalls that will prove very damaging if mismanaged. As new regulations are set to go into force in the United States, the stakes for getting this pivot right are higher than ever before. The Covid-19 pandemic is accelerating digital transformations, and companies should consider implementing these four privacy-focused measures: 1) Check how your vendors and partners use customer data, 2) Perform impact assessments to monitor risk, 3) Strive for clarity in your privacy policy, and 4) Designate a data protection officer.

Illustration by Nathalie Lees

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For companies everywhere, Covid-19 has expedited digital transformation at almost unimaginable speed. In an effort to survive and get back to business safely, companies have rapidly adopted services such as contactless payment, click-and-collect applications, and enhanced customer relationship management. These transitions are vital for business to continue, but each also introduces new risks. For every business that shifts operations online, there are potential privacy pitfalls that will prove very damaging if mismanaged, and as new regulations are set to go into force in the United States, the stakes for getting this pivot right are higher than ever before.

Across industries, teams with expertise in real-world spaces are rushing into digital ones where they’re novices and pumping huge amounts of user data into new systems. In the restaurant industry, establishments are scrambling to build new online ordering and delivery infrastructure or to partner with companies who already offer those services. In higher education, institutions faced with missing out on a year’s tuition fees are rapidly migrating their entire curriculum online, and rushing to digitize everything from online teaching to student health records. In the live events space, production veterans are being asked to migrate their well-established processes online and into new cloud technologies. In each case, these changes carry the risk that reams of personal data will be mismanaged and vulnerable to exposure.

Further Reading

This situation raises two major challenges for many businesses: First, they need to make quick decisions on procuring new technology: building online storefronts, implementing communications platforms that process customers’ personal data, and more. Second, they lack experience with data processing infrastructure, or even technology in general. That adds up to teams making quick decisions on the use of technology systems they don’t know much about. There might be an understandable temptation to treat privacy concerns as a secondary issue — one that can be addressed after the immediate crisis — but that would be a mistake, and one which would place companies at elevated risk of monetary fines, class-action lawsuits, and PR headaches.

There’s been growing regulatory pressure on both sides of the Atlantic. The General Data Protection Regulation (GDPR) in Europe, which was implemented in May 2018, and the California Consumer Privacy Act (CCPA) in the United States, which becomes enforceable by law on July 1 (impacting any company with a presence in California and over $25 million in annual revenue), contain stringent protocols for the management of user data, and both threaten steep fines for businesses that get data wrong. Particularly in the United States, there’s little reason to think that regulators will meaningfully relax standards because of the pandemic. California Attorney General Xavier Becerra has been unambiguous in his intent to press forward on implementing CCPA, stating: “We’re committed to enforcing the law starting July 1. We encourage businesses to be particularly mindful of data security in this time of emergency.”

The good news is that managing privacy concerns doesn’t have to be yet another daunting task on top of the already Herculean feat of moving large parts of your business online. There are a number of simple, meaningful steps you can take to minimize the risk of a privacy breach. To make your rapid digital transformation as safe as reasonably possible in the coming months, consider implementing these privacy-focused measures. Each can be done independently, but if your business can tick all four of these boxes, you’ll greatly mitigate privacy risk:

1) Be Mindful of How Your Vendors and Partners Use Customer Data

Businesses may be tempted to rush into contracts with third-party vendors who promise “plug-and-play” solutions to a number of digital transformation challenges. And while companies may be aware that they must review any Data Processing Agreements (DPA) during procurement, there is a tendency to underestimate the consequences of skipping this step. Under CCPA and GDPR, a business can be held financially liable for failure to perform due diligence on third parties that process customer data — in fact, this was the scenario that led to Marriott Hotel Group being fined $123 million by ICO in 2019.

Your key focus when reviewing vendor DPAs should be ensuring they’re privacy compliant and that their data policies align with your business’s stated data policies — otherwise a business runs the risk of violating their own privacy policy. Additionally, check the language about subcontractors in any vendor DPA. There should be assurance that vendors won’t subcontract to another processor unless explicitly instructed by your business to do so. This ensures your business is legally protected if a vendor unilaterally offloads data duties to a non-compliant third party.

2)  When Processing Data, Perform Impact Assessments To Monitor Risk

Impact assessments for data processing are required in many cases by GDPR, but not required by the CCPA. However in times of frenetic change, implementing basic risk assessments for data activities — however tedious — forces businesses to think critically before making a potentially damaging decision on issues like data storage, subcontracting, and more. Furthermore, in the event of being charged with a privacy violation, a paper trail demonstrating proactive steps to mitigate risk reads favorably to regulators.

The UK’s Information Commissioner’s Office provides a free data protection impact assessment template that will set your business on the right track to accurately assessing privacy risk, whether you’re based there or not.

3) Strive for Clarity in Your Privacy Policies

As key stakeholders reevaluate privacy policies ahead of CCPA enforcement, consider how the document reads. Your goal is to make this policy accessible to all of your customers — not just those fluent in legalese. You might think you’re covering yourself by including phrases wide open to interpretation to prepare for any future regulatory requirement, but your priority should be to help your increasingly privacy-savvy customers understand your policy and trust your company. Slack’s privacy policy shows that thoroughness doesn’t have to come at the expense of clarity for readers.

4) Designate a Data Protection Officer (DPO)

No matter a business’s size, centralizing responsibility for data decisions is preferable to diffusing responsibility across multiple departments. That is truer than ever during times of rapid change. DPOs serve as a focal point for privacy concerns within an organization and a vital liaison to regulatory bodies while the character of privacy law enforcement remains ambiguous. Even if the person lacks privacy experience, empowering a single set of eyes to focus on privacy is a quick, cost-conscious way to de-risk.

As stated at the outset, managing rapid digital transformation well can require taking risky action. But in the current climate, depending on regulatory largesse is an unnecessary risk for businesses when they can take simple, process-driven steps to shore up privacy.

Data privacy implementation exhibits many features of the economist’s “time inconsistency” dilemma – it’s too soon to do it until it’s too late. And as we’ve seen in the last few weeks, “too late” can mean a serious stumble at a critical business juncture.

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What Black Employee Resource Groups Need Right Now

Chelsea Victoria/Stocksy

Employee Resource Groups (ERGs), also referred to as business network groups or affinity groups, have served and supported the culture of corporate America since the 1970s. Typically organized around a shared identity, such as race, gender, age, or mental health, they serve as a haven of belonging, offering a space for underrepresented employees to find one another, stave off a sense of isolation, and experience a reprieve from the daily aggressions they’ve endured at work.

ERGs bring many benefits to organizations. They identify and help develop internal leaders. They lead to higher retention rates. They educate employees — including senior leadership — through internal events, panels and more. They help companies recruit underrepresented individuals and develop a talent pipeline: According to a 2014 survey conducted by Software Advice, 70% of U.S. respondents who were 18 to 24 years old and 52% of respondents between 25 and 34 reported they would be more likely to apply for a role at a company that had ERGs. Fifty percent of survey respondents stated they would remain at a company because it had an ERG.

Black ERGs were the first affinity groups established in corporate America, primarily in response to the racial unrest in the country. Xerox pioneered the first corporate ERG — a group for its Black employees — in 1970. Black ERGs still remain as relevant as ever — and have become even more impactful. AT&T’s Black ERG, The NETwork has more than 11,000 members, and in 2015, the company reported an 85.6% retention rate for its Black employees. AT&T credits The NETwork as a prime resource for identifying candidates for leadership. More recently, in the wake of George Floyd’s death, Amazon committed $10 million to fighting for social justice and aiding Black communities. The company’s Black Employee Network (BEN) helped leadership identify the recipients of those funds. Similarly, DoorDash established a $500,000 fund, which will be directed by its Black ERG to state and local organizations.

Right now, at a height of racial uprising in the U.S., what is it that Black ERGs need? Most of their needs are the same as what they needed yesterday and will need tomorrow, and some are not exclusive to Black ERGs. But denying these needs will only exacerbate the inequity that Black employees already experience.

Equity & Resources

As with most ERGs, Black ERGs are largely volunteer led. They typically don’t have a sustained or committed budget. Members cobble together funding by soliciting various leaders to provide funding for events or even paying out of pocket for things like refreshments. This work is taken on in addition to their full-time jobs, without additional compensation. I have worked at organizations where ERG members have even received backlash from their managers and colleagues for participating in “extracurricular” activities or for rocking the boat and highlighting race.

It’s time that organizations compensate these leaders for their work. In the past, ERGs were primarily a support network for people with shared identities, but now organizations rely on them for recruitment, retention, marketing, strategic guidance, and other business functions.

Compensation could take the form of an increase in overall compensation, a bonus, or formally dedicating a percentage of their role to this work.

Funding conference attendance is another potential form of compensation. Conferences for Black employees, such as the National Black MBA Conference, AfroTech, or the Corporate Counsel for Women of Color Conference, provide Black employees a way to feel less isolated, develop their network, and receive leadership and development training that speaks to their specific experiences.

Companies can also fund memberships in external organizations that support Black employees in specific fields and sectors, such as the National Association of Black Accountants or the National Bar Association. There are professional organizations that support Black employees in practically every sector.

Organizations should provide their ERGs with administrative support. From reserving rooms to creating flyers to ordering catering, this work requires extended amounts of labor and does not necessarily provide the development skills ERGs members need to become valued leaders.

Transparency & Trust

Companies that use their ERGs to recruit Black employees need to make sure they are taking care of their current Black employees. If they don’t, they are ultimately adding to the emotional labor of their current employees, who are left to nurture and support their new colleagues when they are subjected to anti-Blackness and inequity.

Performative allyship needs to be done away with. Right now, companies are issuing words of support for Black Lives Matter and Black employees. Unfortunately, the experience of Black employees doesn’t always match what’s been said in these written commitments, and this hypocrisy will do little to foster trust. Black people are promoted at a lower rate than white peers. They are paid less than their white colleagues. Reports of discrimination and other marginalizing behavior goes unaddressed by HR teams: Black employees account for 13% of the U.S. workforce — and 26% of discrimination complaints filed at the EEOC. In fact, companies pay millions of dollars to settle racial discrimination claims every year.

One way to build trust is to hold leaders accountable when they fail to adhere to their organization’s publicly espoused diversity, equity, and inclusion values. When leaders are given a pass — whether it’s for making or allowing denigrating statements about Black people, not hiring, retaining, or promoting Black employees, second-guessing Black employees’ decisions in ways that they don’t question white employees, or relying on Black employees for expertise on race rather than for their skill set — it sends a message to Black employees: You are not valued. You do not belong here.

Mental Health Support

Black Americans experience trauma on a daily basis, and the severe psychological distress caused by ongoing police shootings doesn’t dissipate once employees enter the workplace. In fact, the level of anxiety and trauma can escalate when Black employees are underrepresented in white-dominant workplaces. Black ERGs provide a safe space for these employees to be connected and supported, and to process and discuss these experiences.

Companies shouldn’t solely rely on Black ERGs for this work. They must ensure that employee assistance programs (EAPs) provide racial trauma support and have a roster of Black care providers. After the murder of George Floyd, organizations like Amazon brought in racial trauma specialists to support their employees. On MSNBC recently, Ashley McGirt, a prominent racial trauma specialist in Washington state, noted an uptick in corporations who are seeking racial trauma specialists as they acknowledge the impact of racial aggressions on the health of their Black employees.

Formal Validation from Leadership

It doesn’t matter how much value Black ERGs bring to an organization if the highest levels of leadership don’t recognize — or worse yet, dismiss — their contributions. Recognition from the C-suite informs budget opportunities, encourages grace from people managers when employees want to participate or attend learning opportunities offered by ERGs, and demonstrates an intention to include and welcome Black employees. Below are some of the ways that leaders can give this type of validation.

Invest in Your Black Employees’ Success

Companies should leverage Black ERGs to fill internal leadership pipelines. These are employees who are already putting in the effort to be engaged and plugged into the organization. Failure to groom internal Black talent for leadership will result in Black employees leaving or becoming disengaged, and lead to a never-ending hiring spree to recruit new Black employees. A lack of promotions for Black employees will also present a red flag for potential Black candidates the organization seeks to hire.

Signal Public Support

The workforce notices when the CEO is present at an event or sends a company-wide message encouraging employees to attend a function by an ERG. This validates their efforts and presence. It is another way of saying, “This group belongs here and is a part of our team,” or “We all can benefit from this event and it is a worthwhile use of your time.” Similarly, it is noticed when the CEO is absent or indifferent.

Connect With — and Listen to — Your Employees

It’s a mistake for leaders to only get input through employee surveys and HR. Too often that feedback gets diluted or muddied. Instead, top leadership needs to proactively request direct input from Black employees on their concerns — and then act on those concerns. No matter how much data is collected, there is no substitute to having first-hand, transparent, and open conversations with Black employees and then heeding their guidance.

Actively Sponsor the ERG

Each ERG should have an executive sponsor who is either in the C-suite or one level removed, who can advocate for the ERG’s initiatives, clearing barriers and supporting them in achieving their strategic goals. In the case of Black ERGs, I believe the sponsor should be a non-Black person so that they model active learning, cultural stewardship, and advocacy across cultures. Too often, the few Black leaders are drafted to lead the Black ERG instead of recognizing that cultural stewardship is the responsibility of all leaders. The executive sponsor should be present at all ERG events and an active participant in initiatives, committed to being an ongoing learner and not an expert. 

In recent years, some companies have moved away from ERGs — most famously Deloitte decided to phase them out, arguing that often they leave out white men, who need to be part of the conversation. But many advocates recognized this decision as another white-centered decision made at the cost of underrepresented employees. Why can’t the white leaders move past their discomfort to be a part of these conversations and participate in spaces where whiteness isn’t centered?

Black ERGs are a clear pathway for organizations to offer support to Black employees. They are also a critical resource of information about what is and is not working for Black employees. Valuing, supporting, and sustaining a Black ERG is a win-win for the company and those they aim to support.

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Office Reentry Plans Must Account for Medically Vulnerable Employees

Executive Summary

It is not a question of if, but how many of, your employees will fall into the high-risk group for coronovirus, given the wide range of pre-existing conditions identified by the CDC that make someone more susceptible to adverse outcomes. While it’s important to create a safe workplace for all employees, it is especially important to think about how you will support this specific, high-risk employee population. The author offers several recommendations: 1) Establish a process for fielding questions and concerns. 2)  Support their ability to continue working from home. 3) Make sure they feel included on the team. 4) Provide training for managers.

Noam Galai/Getty Images

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After a few months of sheltering in place, states are beginning to open up and employers are starting to consider what a potential “back-to-the-office” plan might look like. Many people are feeling anxious about how safe the office will actually be — especially those who are at higher risk for Covid-19. This anxiety also extends to employees who might not be high-risk themselves but live with someone who is. (For brevity, I’ll refer to these two groups collectively as those who are high-risk.) How your organization supports these employees needs to be a key part of your reopening plan.

It is not a question of if, but how many of, your employees will fall into this high-risk group, given the wide range of pre-existing conditions identified by the CDC that make someone more susceptible to adverse outcomes. While it’s important to create a safe workplace for all employees, it is especially important to think about how you will support this specific, high-risk employee population. Below are several recommendations.

Have a process in place for fielding questions and concerns.

HR leaders I have been talking to in various sectors have been addressing a wide range of employee questions throughout the crisis. This will only accelerate when the organization gets ready to reopen its offices, and there will be many questions and concerns specifically from this subset of employees.

Irene Bassock, an employment attorney and Of Counsel at the law firm Cohen & Buckmann, says, “There has to be some type of planning, knowing that these requests will be coming in fast and furious. It’s important that employees know where to go. That there are people on the front line, whether it be their managers or HR. That questions are getting to people who understand how to respond to those questions, so you don’t get knee-jerk reactions.” Having a clear process in place will help create greater alignment and mitigate conflicting messages.

Support their ability to continue working from home, if possible.

A silver lining of this pandemic is that it might normalize remote work. While working at home is not ideal for everyone, we have all learned over the last few months that it is doable when necessary — and even beneficial. Allowing high-risk employees to work from home will not only help them feel safe but will also reduce the number of people in the office, giving those who are physically present more space to socially distance themselves. Studies have shown that, in student populations, fearing for one’s physical safety negatively impacts performance, and the same relationship can be inferred for working adults.

Make sure they feel included on the team.

There are a number of ways to do this. For example, don’t make them the only one calling into meetings. One organization I worked with, prior to the pandemic had a policy that if one person calls into a meeting, everyone calls into the meeting in order to level the playing field.

Further Reading

Another way to prevent these employees from feeling marginalized, while also mitigating risk of infection to your other employees is to create A and B teams (or possibly more). Here, project teams are comprised of both A and B team members (note: A and B do not indicate any difference in employee performance). A and B team members alternate weeks in the office. This provides multiple benefits: High-risk employees are not singled out as the only people working from home; there is even more space at the office and therefore, more social distancing; and if an employee does become sick, an entire project team is not affected and disruption to the project is minimized.

Provide training for managers.

This training needs to include two elements. The first is to train managers on how to respond to inbound requests, whether it’s how to answer them directly or how to convey the organization’s process for handling them (if someone like HR needs to get involved). The second is to train managers on how to be more attuned to how others are feeling and how to express empathy. Essential coaching skills should also be taught. These include engaged listening skills and inquiry skills to better understand each individual’s situation, as well as how to probe beyond superficial answers to understand how a colleague is really doing.

While the pandemic has greatly increased the complexity of our world, it’s clear that the ongoing safety and welfare of your employees needs to be at the top of your priority list. This is especially important for those who are at higher risk. The strategies above can help you best support this employee population and should be a key part of your reopening plan.

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The Best Managers Balance Analytical and Emotional Intelligence

Executive Summary

Being an effective manager requires balancing two networks in your brain: the analyic network (AN) and the empathic network (EN). Managers need to understand their employees and their specific challenges and they need to relate to their feelings and emotional state. They need to form and confirm their thoughts about their perspective and they need to be open to hearing and seeing what their employees hear, see, and feel. The authors point to recent research for insight into how the analytic and emphatic networks work in our brains — and how to become more adept at balancing both.

HBR Staff/Miguel Navarro/David Malan/Getty Images

Have you ever responded to a colleague or direct report in a way that left them feeling unheard or unappreciated, even though that was not your intention? Perhaps you gave them a prescriptive solution when what they needed was an empathetic ear. Or maybe you emphasized deadlines, task-related commitments, and accountability at a time when what they needed from you was compassion and understanding. As a manager, it is likely that you have experienced this at some point. These types of experiences are even more likely to occur during periods of crisis like the one in which we currently find ourselves.

These are extremely challenging times. We are in the midst of a global pandemic with the numbers infected by the coronavirus in the millions and deaths in the hundreds of thousands. Because of the corresponding economic shutdown, many businesses are closing their doors permanently. In the U.S., we are experiencing unemployment levels not seen since the Great Depression. On top of all of this, streets are filled with protesters crying out for justice after yet another unarmed black man, George Floyd, was killed at the hands of the police, seen in its entirety in a shocking nine minute video viewed all over the world.

In times like these our employees are struggling. They are stressed. They are afraid. They are worried about their health. They are worried about their ability to provide for themselves and their families. And, on a broader level, they are concerned about the current and future health of the United States and the rest of the world. Truth be told, you are likely feeling some of the same things. Yet, as a manager, you are required to soldier on. Budgets have to be managed, sales targets have to be met, and difficult decisions have to be made to ensure the ongoing viability of your organization.

It is of paramount importance to attend to the needs, fears, and concerns of your employees. It is also vital that you solve pressing problems and make critical decisions necessary to sustain the business. The problem is that these two things require us to activate different parts of our brain. And, we can sometimes get stuck in either the network in our brain that enables that task-focused attention needed to solve problems, or in the other network that facilitates reflection, compassion, and social connection.

To be most effective in leading and truly helping our employees, however, we need both networks. We need to understand them and their specific challenges and we need to relate to their feelings and emotional state. We need to form and confirm our thoughts about their perspective and we need to be open to hearing and seeing what they hear, see, and feel.

Thankfully, we can turn to recent research for insight into how these two networks work in our brains — and how to become more adept at balancing both.

Insight from Recent Neuroimaging Studies

Research by our colleague, professor Anthony Jack at Case Western Reserve University, describes two of the major neural networks functioning in our brains as the analytic network (AN), or technically the task-positive network; and the empathic network (EN), also known as the default-mode network.

The AN helps us make sense of things and events. We use it when we are solving problems and making decisions. It helps us engage in abstract or analytic thinking, like financial analysis and data analytics. The EN enables us to scan the environment and be open to new ideas and other people. What’s really interesting is that these two networks oppose each other. More specifically, they actually suppress each other. When one is activated, the other is deactivated.

Professor Jack calls these two networks opposing poles of reason. Both involve cognitive activity, both involve fast and slow thinking, both involve reason. However, the AN reasoning is more about information and analysis and the EN reasoning is more about people or qualitative observations.

As we also discuss in our book, Helping People Change, we need both networks. We further contend that the most effective leaders do indeed use both and they are able to toggle back and forth between them in a fraction of a second. We also believe that the ease with which a person can toggle or cycle back and forth between these networks depends in part on their self-awareness, deliberate practice, and conscious intent.

How to Achieve the Right Balance

1. Be aware of your own predilection. What is your “go-to” neural network?
Being aware of your dominant neural network, or the one that is most likely to get activated for you across a variety of situations, requires the practice of mindfulness. You need to be fully and consciously aware of momentary experience. Questions you might ask yourself include:

  • How am I processing things at this moment? Am I thinking about concrete facts, details, or solutions? Or, am I reflecting more openly and creatively about possibilities? Am I thinking about what is objectively right or wrong? Or, am I weighing the relative merits of what seems fair or morally just?
  • What types of situations or activities tend to pull me into the analytic network? When am I most likely to be pulled into the empathic network?
  • On the whole, do I spend more time in the analytic network or the empathic network?

2. Exercise the neural network that isn’t your go-to. There are a variety of ways to exercise your empathic and analytic neural network “muscles.” A useful approach is to spend more time exercising the network that you are less likely to use. It is similar to the benefit of a right-handed basketball player working on dribbling and shooting with their left hand to improve their overall game.

To exercise your empathic network:

  • Complete at least one 15-minute conversation each day in which your sole purpose is to understand the other person, not to solve their problem or give advice.
  • When you are listening to someone, stop whatever else you are doing or thinking about and try to give that person your full attention. Attempt to listen beyond what you hear, tuning into to the whole picture of what you hear and see, (i.e. body language, tone of voice, emotional cues, etc.).
  • If you think there is something you know with relative certainty, push yourself to challenge that assumption and consider other possibilities.

To exericse your analytic network:

  • Schedule specific windows of time within which to complete certain tasks. Hold yourself to those committed windows, even if they are not actually firm deadlines.
  • Identify a situation at work that requires a new approach to reach a successful outcome. Maybe it’s a change to an existing vendor contract. Before you seek the perspective of others, do some research. Come up with questions that you need to get addressed. List two to three new resources that you normally wouldn’t think of, including people. Write down the pros and cons of each resource, considering the cost of each and their potential contributions. Connect your notes together into a framework to help you move ahead.
  • Compile a list of household expenses incurred each month such as utilities. Record your actual expenses paid over the last 12 months. What are the trends you see in the numbers? What was the highest or lowest amount paid and in which month? How do the expenses compare to what you anticipated?

3. Practice balancing both. Once you have mastered the ability to be more aware of when you are either operating in the analytic or empathic network at any given time, and you have developed the capacity to activate either network upon demand, you are then ready to practice effectively balancing the two networks. Again, both networks are important. Your objective here is to develop an ability to seamlessly toggle back and forth between the two networks as necessary.

Specific things you can do to work on your ability to toggle between the two networks include:

  • Be clear on your intention. We may sometimes be aware of a need to toggle from one network to the other, but consciously choose not to do so. In other words, sometimes it is not an ability issue, but instead a motivation issue.
  • When making (or communicating) a decision that impacts others, think about potential personal implications of the decision. Spend time attending to these relational aspects in addition to the technical ones.

The analytic and empathic networks are waging a constant battle in your brain. When one is activated, the other is suppressed. You don’t have to choose sides, however. It is not that one is good and the other is bad. You actually need them both. The key to maximizing your effectiveness as a leader and having more productive relationships is learning to be more aware of which network is activated at any given time and being able to seamlessly toggle back and forth between the two as necessary.

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Businesses Must Reclaim Prudent Accounting Principles

Executive Summary

Prudent accounting balances the forces that drive a business to be efficient and resilient by helping a company stay asset light and forcing it to write off dud projects as their losses become apparent, even in otherwise good times. Such a company is thus less likely to throw good money after bad, lowering waste in the company and in the economy. And, when bad times hit, the company is less prone to be carrying unwanted costs, a huge relief for everyone, including the taxpayer. Likewise, when a prudent company raises debt, it does so despite the downward bias in its accounts — so that debt is safer in that it sits on a more conservative cushion. This makes the company and its creditor less likely to fail when a crisis hits. And finally, by being prudent in good times, the company has recognized losses earlier, and attenuated the scale of its dividend and bonus payouts. This means there’s more of buffer in retained capital to weather it through a crisis.

Image Source/Getty Images

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Beyond its human toll, Covid-19 has wrought upon us a daunting economic toll. In a matter of just two weeks in mid-March 2020, entire industries and sectors were brought to an abrupt halt. In the UK, for instance, car manufacturing fell from more than 70,000 cars in April 2019 to just 197 cars in April 2020; for further contrast, the UK made more than 120,000 units during February 2020.

Further Reading

To survive a crisis like this, a business must be both efficient and resilient. Prudent accounting — the common-sense accounting concept that there should be a higher threshold to recognizing anticipated gains relative to recognizing anticipated losses — had for generations helped businesses balance these two pulls. In turn, businesses were better prepared for an unpredictable blow. Then, at about the turn of the 21st century, accounting rulemakers did away with prudence. We are living the consequence today: The economy is teeming with crappy balance-sheets that necessitate gargantuan bailouts when crises hit.

Now, concerned about anemic bank lending to industrial companies, regulators have further curtailed prudence. The Fed recently eased a key accounting restriction that encouraged more responsible lending and ensured that banks had a robust cushion against crisis-induced losses. In the UK, the central bank is so alarmed by weak lending to corporations that it is urging financial institutions not to book big charges on potentially souring loans. These practices constitute the opposite of prudence.

A financial crisis like our current one was not unimaginable. It has only been slightly more than a decade since the world last experienced a sudden shock to global industrial solvency, and the idea that such a shock could come from disease was made very real by the near-miss Ebola and Zika outbreaks of 2014 and 2016. So the real question is how do we avoid finding ourselves here again when we face the next major economic shock? One answer is to bring “prudence” back to corporate accounting.

How Prudence Balances Resiliency and Efficiency

Resilience is the ability to withstand and recover from negative shocks. Resilience is slack — the capacity to absorb failure and continue onward. You are not resilient if you’ve continued to hold on to that loss-making division instead of shutting it down. You are also not resilient if you have underused debt in growing your business, because it likely means you have not diversified to a level where you can now afford a few failures.

Efficiency simply means greater output and lesser waste for a given quantity of input. Efficient organizations are asset light and more leveraged, relative to peers — features that seemingly make them less resilient. They appear to have fewer reserves to draw on when the rains fail. But being asset light really means you are carrying less excess baggage when you need to move quickly; it does not mean that you have shed yourself of the essential baggage. Companies, like would-be dieters, often get this wrong in their quest to being lean. Similarly, being more leveraged than your peers means you can do more with less capital, which can be hugely advantageous when capital is scarce, as during a crisis. The key is to assume only as much leverage as you need to operate at efficient scale and scope, and not to assume leverage to pay out dividends or bonuses, as several banks did before the last financial crisis.

Prudent accounting balances the forces that drive a business to be efficient and resilient by helping a company stay asset light and forcing it to write off dud projects as their losses become apparent, even in otherwise good times. Such a company is thus less likely to throw good money after bad, lowering waste in the company and in the economy. And, when bad times hit, the company is less prone to be carrying unwanted costs, a huge relief for everyone, including the taxpayer.

Likewise, when a prudent company raises debt, it does so despite the downward bias in its accounts — so that debt is safer, in that it sits on a more conservative cushion. This makes the company and its creditor less likely to fail when a crisis hits.

And finally, by being prudent in good times, the company has recognized losses earlier, and attenuated the scale of its dividend and bonus payouts. This means there’s more of buffer in retained capital to weather it through a crisis.

Getting Back to Prudence

Prudence is both a regulatory principle and a managerial state of mind. To bring back prudence into accounting thus requires two layers of action. First, the U.S. Securities & Exchange Commission (and its equivalents worldwide) should mandate that any new accounting standards — and indeed any accounting standards issued since about 2000 — meet the prudence test. Put differently those standards should require objective evidence before companies can book gains (or avoid losses) on the basis of expected future profits.

Second, boards and auditors should exercise greater skepticism when approving CEO and CFO judgments on highly discretionary items such as capitalizing intangibles and avoiding goodwill charge-offs. In anticipating such pushback, senior management will then impose their own higher standards in making these decisions, resulting in higher quality balance-sheets.

Prudence in accounting practice has been around since at least the 1400s, and by the late 19th century and the advent of modern capitalism, it was already a well-developed and widely regarded principle. We foolishly abandoned this history quite recently, but two major financial crises and trillions in bailouts later, we must reclaim it.

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