Sanford Health News writer Jacqueline Palfy sat down with Kelby Krabbenhoft, president and CEO of Sanford Health, on a recent afternoon to talk about the future of the organization. Earlier this year, Sanford Health and The Evangelical Lutheran Good Samaritan Society finalized an affiliation, creating a new company with 50,000 employees and $6.5 billion in annual revenue.
We asked Krabbenhoft to share his vision of the new company, his message for employees and his hope for the future of health care.
Question: We’re a much bigger company now. We’re not the Sanford Health of 10 years ago, or 100 years ago. Tell me how you see us, with the addition of the Evangelical Lutheran Good Samaritan Society.
Answer: You know, I’m asked that question a lot, and I give Newt Gingrich credit for having asked me that in a public forum when I wasn’t ready for it. And he said, “So what do you describe Sanford as today?” And I thought, “I’d better just say what it is that people see rather than some administrative definition.”
Q: So what did you come up with?
A: We are clearly a growth company, and we have been about the business of growth because it’s in our nature, and it’s what we believe to be the future of health care. Scale matters, but the right scale, not just flags on a map somewhere. Then along came Denny Sanford, and he added fuel to the notion of a global growth strategy. We started just 20 years ago as a company of about 3,000 employees with $250 million in annual revenue. Today, we sit with 50,000 employees on $6.5 billion in revenue. Then all the other analytics that go into describing the profile of Sanford Health make it a very compelling, large organization.
Q: And there’s no shame in growth.
A: No. You know, old sayings like in “Shawshank Redemption,” you better get on with living or get on with dying. And in health care, the era we’re living in, I think you better get on with growing or get on with shrinking, because that’s what’s going on. The reasons behind growth are because you can bring scale, reduce cost and there’s the opportunity to present yourself as being able to take on a much bigger and broader constituency of patients, and people, and, in our case, insured lives as well. That’s really important.
On Sanford Health culture: ‘We have to always be planning ahead’
Q: What do you think people think of when they think of Sanford Health?
A: We have this reputation that I’m really proud of, and it comes out of the culture of this area of the country, and I know everyone is proud of that when I say it. We execute. We get things done. And I stole this from “Game of Thrones,” but the reason we do that is because winter’s coming. In the Upper Midwest and on the Great Plains, winter’s always coming. We plant in agriculture because we know we have to harvest before winter comes. We have to always be planning ahead because nature is in our bones here, and I’m appreciative of that. It gives us a sense of urgency and focus.
Q: That sense of place is important in our culture.
A: Another old saying is to remember where you came from, and for us, that’s a humble part of the world. And our most recent relationship that’s been forged with the Good Samaritan Society is really evidence to the fact that we don’t forget where we came from.
Q: You talk about our shared roots.
A: It’s been by coincidence. I wish I could say I engineered it, but that’s not the truth. It’s the good fortune that people with like minds, like heritage, have come together, and also with the perspective of the kind of care we believe needs to be delivered to folks.
Q: You talk about the Sanford Family all the time, and now, with the Good Samaritan Society, we’re a blended family. And any time you bring two families together, there can be friction. What do you want people to know about us as a new company and family?
A: The Good Samaritan Society has been part of the fabric of the Great Plains forever. They’re in 26 states, and Dave Horazdovsky and other members of the leadership team were actually college classmates of mine. It’s a very close relationship. We’d done business together for 20-some years, but this time, it was more serious. It was about challenges that the whole long-term care industry was facing. Dave told me, “You know, nobody else has ever done this, Kelby. Nobody has taken a nationwide long-term care company and merged it with an acute care organization, stayed not-for-profit, stayed true to their ideals and made it work.”
And I said, “Well, what do you say we give it a try?”
And it took a year, but two things happened: The depth of opportunity to grow, to execute on our promises and never forget where we came from was right in front of us. We had to work with what I’d consider a very minor economic challenge that the Good Samaritan Society has, but by coming together, it’s reduced to a pretty modest issue.
On strategy: ‘The only place we really have any influence on is ourselves’
Q: Talk about what this means as an overall business strategy.
A: The Good Samaritan Society and Sanford is probably the most relevant, exciting thing that’s happening in health care today from the standpoint of the full continuum, being able to take care of people without gaps. It can be a fragmented industry, when clinics and physicians are not aligned, or the IT system or the financial system. We need to make sure the care you’re receiving is seamless, without gaps.
Q: So now we’re in 26 states, and we’re in nine countries. We’re local, we’re regional, we’re international. And now we go through the lifespan taking care of people. How does this change the conversations people will have with us from a policy standpoint, and how does it affect the power we have to influence change?
A: The only place we really have any influence on is ourselves, and it seems like 50,000 people are more than any one person could get their arms around. But I see our common culture and I see the commitment that’s expected from the company, and it’s lived up to by the people, and I get really fired up about what we’re capable of doing.
Our agenda is to become significant enough that politicians, businesses, communities all see us as a really valued element of those communities and of the states and of the country. And if we do that and can demonstrate we can do it more efficiently, cheaper, and with maybe even higher quality than anybody else, then that will start to roll. It’ll be like a snowball.
On employees: ‘I want the best people, and I want them happy’
Q: And what does this new company mean for employees?
A: I asked a Good Samaritan employee how she felt about this at a recent event, and she said, “You know, I want this real bad.” She talked about the opportunities for her career and how it was nice to know she could stay with the same company but go into insurance or nursing or administrative leadership. And that was the first time from the floor that I was really able to feel the impact this was going to have.
If we can hit that generation with where they are in their pursuit of health care, that really impresses me.
Folks in this blended family should feel all the weight of that young woman’s opportunity. They should say, if you’re a senior employee of this organization, you are building a foundation for them. So, do it well. That’s your legacy. Every day we get out of bed because we’re taking care of someone who needs it more than we do. Look at the generation coming behind us, and that’s where my focus is today.
I want the best people, and I want them happiest, and I want them showing up every day knowing exactly why we’re doing what we do.
Q: And you want them to be ambassadors of our company, too.
A: Yes, as you talk to your kids about what you’re hearing today, do it in a way that explains their potential, their future. They’re doing God’s work, and we’re committed to it, across the country and across the globe. They’ll have an incredible career doing what Mom and Dad did.
On Sanford Health News as a community resource
Q: You know, we’re approaching all this, the stories and videos and conversations on Sanford Health and you want people to talk to us. It’s an opportunity for them to engage people on what matters, right?
A: Sanford Health News was started a few years ago. We decided that if we were able to assemble the talent, we could get our message to our own people and people who are interested in Sanford Health. This is a great opportunity to tell our story and be a leader in this arena.
I’m a pretty approachable guy, and so is my team. You’ll get to know them more here on Sanford Health News. If you have questions or thoughts, bring them forward. That’s how I find out what our priorities are, and without our Sanford Family and employees, we just don’t function. It’s a good time for our family to communicate.
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