Johns Hopkins Gazette: November 7, 1994

Hospital Set to Rethink, Retool Business Ways
By Steve Libowitz

     Administration looks to re-engineering
     as way to remain competitive

The Johns Hopkins Hospital formally launched last week a
process that will rethink and reorganize the way it does
business for the foreseeable future.
     The "re-engineering" of every aspect of the hospital's
operations over the next three to five years is designed to
cut costs, improve quality of patient care and minimize any
potential loss of jobs.
     "This is the hardest job we will ever do as an
organization," said James A. Block, president and CEO of the
Johns Hopkins Hospital and Health System. " But it is one on
which our mission and our 7,000-person workforce depend."
     Dr. Block acknowledged that re-engineering is often
perceived by the public as being synonomous with staff
cutbacks, but he stressed that Hopkins' goal is to avoid or
reduce to a minimum any loss of jobs. 
     He cited the Department of Orthopedic Surgery's
re-engineering effort, which began in early 1993, and
projects savings of $5.5 million over the next five years
without staff layoffs. 
     The re-engineering effort will be led by a steering
committee headed by Gennaro J. Vasile, executive vice
president and chief operating officer, with representation
from senior management, hospital physicians, nurses and house
     "There will be literally hundreds of employees involved
in the design team," said Diane M. Iorfida, senior vice
president for human resources and organizational
effectiveness. "We are committed to cross-training and
retraining to maximize the contributions and potential of
every employee. This is not a zero-sum game in which one
person's gain will be another's loss."
     Iorfida noted that the Wilmer Eye Institute, which
re-engineered its emergency care unit, same-day surgery and
inpatient surgery units into one unit, reduced costs by more
than 20 percent since July 1992.  Although some positions in
the renamed Wilmer Nursing and Trauma Center were lost to
attrition, she said, no layoffs were necessary.
     "Like academic medical centers everywhere, we face the
task of staying competitive in an aggressive local
marketplace while carrying built-in costs related to
education, biomedical research and indigent care that other
hospitals don't have," Dr. Vasile said. "We are determined to
continue to provide the highest quality and the best possible
value for patients and insurers alike." 
     Quality health care and cost-effective delivery are also
the primary concern to the School of Medicine's faculty
practice of more than 800 physicians who provide the
community with all aspects of health care.
     "In general, if re-engineering is managed properly and
is successful in cutting costs without shifting them around,
that's good for the School of Medicine," said the school's
dean, Michael E. Johns. "By reducing costs and making the
operation of the hospital more efficient, we will be able to
establish a fee structure that will be competitive with
anyone in the area and therefore better offer Hopkins quality
     "But we have more than a business interest in this
process," he said. "It is the faculty practice that
subsidizes the school's research and education mission. So,
we look forward to working in collaboration with the hospital
to get the job done."
     Re-engineering will become an enduring feature of
hospital administration at Johns Hopkins, Iorfida said. "We
want to manage by constantly reinventing and refining
ourselves. We will be improving all the time."

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