DaVita: A Community First, A Company Second

DaVita: A Community First, A Company Second

By
Charles O'Reilly, Jeffrey Pfeffer, David Hoyt, Davina Drabkin
2014|Case No.OB89| Length 23 pgs.

This case describes the challenges facing CEO Kent Thiry and DaVita as they being thinking about how to integrate a recent acquisition, Health Care Partners (HCP). DaVita had been primarily a kidney dialysis company with a very strong culture built around teamwork, fun, continuous improvement, accountability, and service. The senior management saw DaVita as “a community first and a company second.” HCP was an integrated health care provider with a substantially different workforce from DaVita.

The case describes the history of DaVita, its industry, its unique culture, and its success over the previous 15 years. It provides a detailed description of how the culture was developed and managed through the use of a series of processes and events including the careful use of language, symbols, and traditions (the company is a “village,” team members are “citizens,” the use of slogans such as “one for all and all for one,” three musketeer costumes, wide sharing of information, involvement of team members, extensive recognition and reward programs, investment in training and socialization, and even a company song). This culture was a competitive advantage in DaVita’s financial success by attracting and retaining staff and patients, maintaining control of costs, and improving clinical outcomes. The new challenge was whether this culture could, or should, be exported to Health Care Partners.

Learning Objective

Depending on how the case is taught, the following learning objectives can be illustrated: •\tHow culture can be used to generate a competitive advantage •\tHow culture is developed, managed, and changed •\tThe critical role of leadership in the management of culture •\tThe importance of aligning culture with strategy •\tThe challenges when integrating a new unit into a strong culture organization.

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