May 4, 2020

Episode 13: Russ Richmond, Founder & CEO of Laudio

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Description

On this episode of The Handoff, Dan speaks with Laudio Founder and CEO Russ Richmond. Russ is a physician who left the bedside early on to pursue a career in entrepreneurship. He explains to Dan why he was drawn into solving issues at the system level, but still thinks of himself as a caregiver. He also shares the story of a serious skiing accident that landed him in the hospital for three months and gave him a completely different lens into what it’s like to be a clinician. This experience ultimately inspired him to start Laudio, a platform that uses artificial intelligence to predict and prevent clinician burnout.


Russ shares that the number one cause of burnout is feeling unappreciated, and how meaningful employee interactions between clinicians and managers can have a profound impact on addressing this. He and Dan discuss the important role that managers play in preventing burnout and staff turnover, the difference between transformative and transactional leadership, and why it’s not one big thing, but hundreds of small things that can make the difference to keeping staff engaged and preventing errors in patient care.

Podcast

Transcript

Dan:
Russ, welcome to the show.

Russ:
Thanks. Thanks for having me, Dan.

Dan:
So Russ, you started out as a physician and pretty early in your career pivoted into other things including venture and starting startups. So tell me about that whole journey.

Russ:
I loved caregiving as a physician, but I also had a real interest in entrepreneurship and system level issues. And my pivot happened very early on, as you say, in residency. And that's when I realized that although I loved the work I was doing, I wouldn't be happy doing it for 30 years, and that there was other work at the system level on making it work more smoothly to smooth out the operations of it, to help deliver higher value at lower costs, et cetera, et cetera, that I was equally or more interested in.

Russ:
And that's when I started to explore around. I actually, with the blessing of my residency program leader, looked around and found a job as a management consultant at McKinsey and Company. And that led to a career first in consulting, and then this is the third healthcare IT related startup or business that I've been involved in at Laudio. And so, I think of myself now as still a caregiver and still a physician, but working on building companies to impact and improve the system.

Dan:
I love it. And you never lose that caregiving clinician mindset. I think it adds a ton of value to your ventures. Would you agree?

Russ:
Totally. I mean for me it's what gets me up in the morning, which is knowing that I'm working on something that's going to have some meaning and is going to somehow impact or change or improve a life, whether that's a patient, whether that's another caregiver, the system in general. That's what's really motivating for me.

Dan:
So tell me what brought you into starting Laudio. I think there's an assumption out there that, why is a physician and his team coming in to solve somewhat of a nursing problem and I just wonder what inspired you there? Because it's an amazing platform. I've been able to see it in the early days and be a part of it, and now it's growing and getting traction in the market. So tell me what inspired you and how's the platform solving the issues of staff burnout and those frontline leader issues?

Russ:
I think there were at least three major influences for me. One is, as I just mentioned, I've been a caregiver, I've been on the front line. Many of my friends, including my wife, are also caregivers. And so I feel immersed in it from a day to day personal network and personal experience point of view.

Russ:
And then about three to four years ago, Dan, I became a patient. I hit a tree, had a skiing accident and hit a tree. And I spent almost three months in hospitals and had a completely different lens on what it meant to be a patient and how important the frontline caregivers were, including and mostly including my nurses and therapists. And that was just a tremendous eye-opener as I'm sure any one of our listeners who has been in that position before will attest, you get a completely different view. And I got to know my caregivers, because I was there a long time. And as someone who was very interested in the industry, I heard from them what they were thinking.

Russ:
And then finally, the third reason is that in each of my last three companies, I've had mostly the same team. And so, I'm working with a team that is really excited by the issues of engagement and turnover and burnout in frontline healthcare. And so I'm really one of four co-founders that shares this passion. Our prior business was a company built and sold nursing pre-hire assessments. And really that was our portal into understanding some of the issues specifically at the nursing level, and we kind of took it from there. So a bunch of different angles from me.

Dan:
Yeah, that's great. And we may have to dive in another episode on pre-hire assessments, because that's definitely a pain point in the industry I'm seeing, just the amount of work and if it even gives you any insight into someone's actual competency. So we'll have to dive into that later.

Dan:
So this series we're doing is on burnout and I know that's one of the core functionalities of Laudio's platform. Can you talk to me about what the biggest contributors to burnout are and maybe some of the ways that Laudio is addressing it?

Russ:
First of all, people who are smarter than me ... And there's a guy, Zubin Damania, who you may know-

Dan:
Yeah, ZDogg.

Russ:
He frames it less as burnout and more as moral injury. And his argument for that is, it's less pejorative. Moral injury is something that happens to you, it's something that the system does to you. And I personally believe that there are elements of that in this whole burnout debate.

Russ:
And so personally, I start from the place that frontline caregiving is just a really, really hard job. You're interacting with people, patients who are not at their best, and they can be uncomfortable, not to mention at times even abusive and in pain. And it takes a very special person to spend their life doing that day in and day out.

Russ:
And so just out of the gate, this is a tough role that only a select few can really do over years. And you add to that all the physical demands of the job, back injuries, and infection risks with COVID now, and dehydration and standing all the time. This is just a demanding job. And the thing that I've always loved about health systems and caregiving and care provision in general, is that it's full of a bunch of professionals. These are folks that generally are going to work until the job is done. They are willing to move their lives around to help support their teams and help their patients.

Russ:
And you put that together with the emotional and physical demands of the job and the willingness to flex the personal life to get the work done, and it's sort of a set up for burnout. What we're seeing is that the single biggest contributor to burnout is not feeling appreciated for doing all of this. And given the risks and given the lifestyle changes and given the amount of work and the demands, not feeling like either the institution or the manager and I'll come back to that, are appreciating the work that is being done.

Russ:
So we're hearing lack of appreciation and specifically, we're hearing that the relationship between the manager and the frontline caregiver is really important, because the manager really is the connection point between that frontline caregiver and the institution and the job overall. The key responsibility that manager is doing recognition and respecting the work that is getting done.

Dan:
Yeah. And sometimes they can manage up to 150 staff, which is almost impossible to be able to systematically and authentically recognize that many people for their work, just to let alone keep track of the HR stuff.

Russ:
100%. I mean, in my days at McKinsey, a normal managerial span of control is something like between 6 and 12 direct reports. And in inpatient nursing, as an example, we see the average is around 50 to 60. And we've seen as high, Dan, as 270 reporting to one manager.

Russ:
So out of the gate, these managers have information issues where they can barely know the name of all the staff. As you know, they're 24 by 7 operators, so they may be working 40 to 60 hours a week, but they're responsible for all the shifts in any given day, seven days a week. It's a difficult job, just structurally.

Dan:
Yeah, I think the frontline management of healthcare workers is probably one of the hardest jobs in the whole system. And you're sandwiched between the demanding needs and resources it takes to deliver care from the frontline and then the requests from upper management on bottom line and finances and all these different things. And you're that translator and you're set up from day one with a management span of control that's way too big and archaic resources and technology that just doesn't let you do it.

Dan:
So I think in one of my previous organizations, there was a manager churn rate, so it wasn't necessarily turnover, but it was, they were leaving the management job by 42% per year. And no one talks about that management churn. They talk about the frontline term, which is definitely important, but there's layers up that are feeling the need for better systems and recognition as well, that's just not there. So I think that moral injury is throughout the system as well.

Russ:
It is. And we're seeing more and more health systems talk about that because when managers are switching jobs or they're leaving management, it leaves gaps and it takes a lot of time for them, obviously for the new manager to get up to speed and to kind of get into the groove. It inhibits best practice diffusion and it causes a lot of disruption in the system.

Russ:
And so we're actually seeing health systems, they're saying, "Hey look, we're actually doing a pretty good job with our frontline nurse or caregiver engagement or churn, but what we're really worried about is our managers." So we're delighted to see some focus where it should be, because as you say, it's got to be the toughest job analysis.

Dan:
Tell us a little bit about the Laudio system and how that's setting up this system to actually have more data, provide recognition, do the things that you just talked about. Can you walk us through some of that?

Russ:
At the highest level, a Laudio is a platform for what we call real engagement between frontline managers and their teams or their staff. About 70% of frontline managers analysis are nurse managers, so our most common type of end user is actually a nurse manager. And at a high level we do two things. The first is we automate many of the manager's workflows and we save them time. And some examples of these are their rounding workflows, their mandatories or flu shots, celebration and recognition, burnout prevention, et cetera. And we found that we can save five to seven hours a week per manager.

Russ:
And then the second thing we do is we increase and ease the number of interactions between managers and their teams. So once the managers are inside the workflows that we help automate and make intelligent in a system with, our AI helps the manager interact with the right team member on the right topic, at the right time.

Russ:
And this is a really powerful concept, because as we just said, many managers have these large spans of control and little time or capacity and maybe even lower exposure to best practices and we're able to push and automate a continuous stream of suggestions for best practices of interactions between the managers and their teams. And in this way, we can massively increase the number of these interactions and it's really the aggregation or the accumulation of first hundreds and thousands of these one-on-one interactions between managers and their team members that make the difference in culture and engagement, burnout, turnover, et cetera in the health systems.

Dan:
This last year, we released a second edition of our textbook on leading innovation. And one of the chapters we added this year was around toxic leadership. And a lot of it stems from just not being able to interact with your team and then rumors build and then that leads into this whole weird culture. And I just love the idea of being able to have visibility into that and automate some of that, so that it's not a burden. It's not living in a manila folder, I think is the other thing. Is most of this workflow is in some sort of physical paper form, and to automate that and have visibility into it is awesome.

Russ:
That's exactly right. We're seeing these managers, many of them living in highly manual workflows that are paper-based and the personification of that is the Post-it Note for use of communication between colleagues or staff. And they just need more contemporary, modern, intelligent, automated workflows. And just doing that can save a ton of time. And then when you do that, you open up the opportunity for best practice diffusion and collaboration and all those other things.

Dan:
Yeah, and I can imagine as you go and talk to nurse managers, they are like, "Where has this been all my life? I needed this 10 years ago." But I can also see that they may see it as another system that they now have to use. So what are some of the best practices you've seen in implementing a new system for a group that's already overwhelmed with multiple systems?

Russ:
Yeah, it's such a great question, because as part of building Laudio, we've interviewed over 400 nurse managers and we've actually categorized their feedback. We're actually going to do a blog post on this at some point, but the number one item is, "You've got to save me some time. If you don't save me time, I don't have the bandwidth to take on something like this." And so that's why we went into automating their workflows. It's just necessary to get them skilled up onto a new system.

Russ:
In terms of best practices of getting this into the system, we've learned to prime the pump a little bit. And so what we do is, your average, let's call it 400 bed facility, is going to have about 50 frontline managers. We start with some of the toughest and hardest working managers. We might take five or 10 of them and get them up on the system and coach them to the point where they're starting to see some of the positive change.

Russ:
And then once they see it and they can speak to their real examples of it and the culture on their units really starts to change, it only takes three to six weeks for this to happen, by the way, we then roll it out more broadly to the entire team of managers. And at that point we have 5 to 10 evangelizers of the value of the product, how it is saving them time and how it's worthwhile taking this on.

Russ:
And what we found is that a peer to peer reference is much more valuable than almost anything else we can do. And so we've kind of done that two step implementation process.

Dan:
I love it. And that fits really closely with, for the innovation nerds out there, the diffusion of innovation theory where Roger's really defined that opinion leader being the catalyst for innovation in a population. And it sounds like you've taken that approach, which is awesome. And we know those vocal nurse leaders and especially the most overwhelmed ones, actually can make or break a product. We used to have a saying at Kaiser, 60,000 nurses, we can stop anything in its tracks. It doesn't matter what kind of rollout, how much money you put behind it, nurses say, no, it's done. So it's good to get those opinion leaders on board.

Russ:
We've learned over time to run right at folks who are feeling the most overwhelmed. And I think that on the surface you could think that they might be the most resistant, but if you can get them to see the light around the time savings that they can personally have and the impact they can have with their teams and this new way of working, using Laudio, then they become the most powerful, in terms of diffusing that best practice. And it's a lot of fun. It's a lot of fun to see those light bulbs turn on and to kind of change the way folks work and to have it result in obviously happier managers, but also happier teams and better care.

Dan:
Yeah, I love it. I have a similar philosophy when I do innovation as well, is go after the ones that are the resistors early on and see ... Watching them flip is awesome.

Dan:
So what are some of the results that you've seen as you've implemented across some systems? What are some of those key indicators that are showing early success?

Russ:
What we track very carefully is the amount of usage on the product. What we found is that managers are using it more and more each week and each month across our client base, which is incredibly professionally satisfying, because we know we've built something that's working for them. And inside that usage we look for the number of interactions that they're having with their team members. And if we're seeing that member go up, we know that's a leading indicator for having a ton of impact.

Russ:
And the two major indicators that we're seeing are time-savings. So we might do a brief survey on the before and after and identify how much time that the platform is saving the managers. And then also engagement scores and turnover. We've got one client that has been on the system for over a year. So they've done a couple of engagement surveys and their engagement survey scores have gone up 20 percentage points in the managers sensitive indicators, which is a pretty broad swath of that survey. So it's moving the overall result dramatically up, and that's been satisfying to see.

Russ:
And then of course we see turnover go down, because in general, even though we know that managers are one of the biggest influencers or levers to address engagement and turnover, they're the most overwhelmed workers and the system as we just got done saying earlier in the pod. So if we can save them time and we can increase the number of interactions between the managers and the teams, a turnover reduces dramatically. And we're seeing results, Dan, of five to seven percentage points of reductions in turnover and that's worth millions of dollars a year to the average health system. So that's been very rewarding to see those take place.

Dan:
Yeah, that's awesome. That turnover number, I know when we had talked early on in the journey, that was kind of the holy grail of being able to impact that. And to reduce it 5 to 7% is just, yeah, millions and millions of dollars, not to mention stress and anxiety out of the system, which can lead to bad outcomes as well, so that's really cool.

Dan:
Technology is obviously not the only solution at play here. So what else is Laudio doing or are the nurse managers doing side by side with the technology to address some of the turnover burnout and such?

Russ:
Well, you know it's interesting. I feel like there's a lot of really great emerging solutions out there. One of them is related to EHR workflow and documentation and so we're seeing a lot of voice assistance and interesting overlays on top of the EHR to ease that entry. And I think those are fantastic and we're really excited by that.

Russ:
We're seeing a lot of use of training for nurse managers. Because a lot of times nurse managers are what we call battlefield promoted, meaning they don't necessarily have more training the day after they take the nurse manager position than the day before. And it really is, as you said well, Dan, it's really a management position that's somewhere in between being an administrative leader of the system and a direct caregiver and it's a difficult job. And so we're seeing a lot of investment in training and we think that that's really important.

Russ:
One of the most important levers that Laudio believes in is really simple, it's praise. What we're hearing is that, and what we're seeing is that praise, recognition of team members, is the one management action that gives you the biggest lift in the engagement of your teams and the turnover your teams. And it sounds obvious, but it's actually devilishly hard to do at scale when you have 60, 70, 100 direct reports. What we find is that managers know that they should do it and that it is intuitive and it does seem obvious, but oftentimes they're looking for a way to get started with some specifics to that individual. Is there a way to prime the pump? And so we're really interested in that concept and we've built a lot of work flow around it and it is the most frequently used portion of our system; those elements that help managers give meaningful, direct and timely praise to their team members.

Russ:
So much so, that we actually named our company after it, Dan. Laudio comes from the Latin root [inaudible 00:00:22:15], which means to praise. And we loved the name because it felt like it really spoke to the ethos of what we were trying to build.

Dan:
I love it. Yeah. In 2009, I wrote a paper, really about burnout or transitions in practice, nurses leaving the bedside. And the key factor I've found in that evidence-based paper was, transactional leadership versus transformational leadership made a huge difference in the way nurses experienced work and ultimately how they decided to leave an organization. And that transactional one was like every once in a while I get a high five if I do something really good and most of the time, I'm getting told I'm doing something wrong. And that's the only time I ever interact with the manager.

Dan:
And that's transactional and then transformational is much more what you described, which is ongoing praise, the little things, knowing it's my birthday, and then also lifting me up when I did that little tiny thing, right or, I picked up that extra hour, I stayed extra, or whatever it was. And that brings just a whole different level of engagement from the team. And that led to much better retention rates. But on the other side, it also led to better patient outcomes. On the transactional side, they showed an increase in patient mortality when people were working for a transactional leader. So the shift to that culture I think is such a key. And I love that it's now enhanced through technology.

Russ:
Oh, we couldn't agree more. I mean transformational leadership is about the hygiene of the small things that are done day in and day out and become part of workflows. And so that's what we're really working hard to support the managers to do more of. As you know, that's a huge concept in magnet. And we've been also very delighted to see some large scale studies, specifically coming out of the VA, around the influence of transformational leadership engagement and the influence on safety and quality. To me, that's the end goal of everything we're doing.

Russ:
And while it's always been, to me, very intuitive that safe, that engagement underpins safety and quality and all the little things that managers are doing are what make the difference in engagement. It's really great to finally see it in the data and to know to be able to stand on a large scale, national multi-centered, dozens of center study that proves this point. It's wonderful data and I think it's evidence that this is really important. It's not just about having a nice culture, although I think that's great too. It's really about influencing the care that we're giving the patient.

Dan:
Totally. And eventually, these small interactions lead to the culture change. I mean it's the artifacts, values, deep assumptions work of Edgar Schein at Stanford so long ago. But yeah, it's just so awesome to see that being much more intentional and people getting their heads around it. So as we wrap up the podcast here, we like to give our listeners that one kind of shining golden egg nugget of advice as we sign off. So what would you want to handoff to the listeners about Laudio and burnout?

Russ:
For me, I think it's all about supporting managers, because they're the linchpin in getting our arms around engagement and burnout. And the better we can support our managers, the more torque we can put on this problem. And I think that as we said, it's not about doing one big thing. It's not about ice cream party for the unit. It's about doing hundreds of small things operationally, day in and day out, that add up into an orchestration of a much bigger cultural change. And I just really can't think of a more important time for us now with the COVID-19 crisis to be thinking about how we're going to do that and we'd love to play a role somehow in that and we really appreciate the opportunity to work on this problem.

Dan:
Where can they find Laudio and where can they learn more about it and you as well, Russ?

Russ:
Very simple, www.laudio, L-A-U-D-I-O.com. That's our URL and everything is on the website. If you want to learn more, you can fill out a form on the website and we will be in touch that day.

Dan:
Awesome. And we'll make sure that gets in the show notes so you guys can look at it on your devices as well. Russ, really appreciate you being on the podcast today, some great insights, way to reframe how we look at burnout and moral injury, and excited that there's some technology that's enhancing the solution rather than adding to the problem. So really appreciate your time today.

Russ:
Thanks Dan. Really appreciate the opportunity.

Dan:
Thank you so much for tuning into The Handoff. If you like what you heard today, please consider writing us a review on iTunes or wherever you listen to podcasts. This is Dr. Nurse Dan. See you next time.

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