STRATEGIC CHANGE, ACCELERATED
Surgical Care Affiliates (SCA) is a major national player in the ambulatory surgery industry. SCA operates 185 surgical facilities, including surgery centers, surgical hospitals, and hospital surgery departments in 34 states. They employ approximately 5,000 teammates, and more than 7,500 physicians perform over 750,000 procedures in SCA facilities each year.
"In terms of culture, and understanding the options around the big lever points that drive a culture, FMG Leading is bar none the best in my experience...it's extraordinary."
Originally the surgical division of troubled HealthSouth, they were spun-off in 2008 after significant operating challenges, including more than 4 straight quarters of profit decline. Their new private equity owners, TPG, recruited the talented healthcare leader Andrew Hayek to lead and rebuild SCA. Understanding the complexity of the task before him, Andrew engaged FMG Leading to assist him in a designing and executing a healthy, sustainable turnaround.
Many of SCA’s challenges involved, or were exacerbated by issues of leader quality, clarity, and alignment. FMG Leading helped Andrew assess senior leadership and build alignment around a new strategy and cultural norms. We began with three clear deliverables: (1) assessing the “pulse” of the engagement and clarity levels of leaders; (2) working with the CEO and his senior team to clarify and align around strategy; and, (3) intentionally designing SCA’s culture to support the new strategy.
Profits improved 11% the first year, and have since grown from $73 million to over $173 million today, an increase of 133%.
Subsequent work focused on implementing SCA’s “new” culture through the creation of an internal leadership university, executing culture events like annual leadership meetings, and directly intervening to understand and improve the engagement levels of SCA’s teammates and physicians.
In the first year of SCA’s partnership with FMG Leading, leader engagement rose 49% and profits improved 11% (year over year). During the entirety of our partnership, revenues are up from $690 million to over $1.3 billion, net income has grown from $73 million in 2008 to over $170 million (an increase of 133%), and the company’s Net Promoter Score has dramatically increased, from -55 to +72.
SCA is truly a story of successful, sustainable organizational change/turnaround driven by leaders and culture. They remain a FMG Leading client today.