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By Root 1679 0

going to watch the manner in which you pursue the case. If these two companies were people—your colleagues or potential business partners—the opinion you form about them would certainly affect the way you choose to interact with them. So let me ask: Given just what you now know about these two similar legal situations, what judgment have you formed about the character of these two companies? Do you think that Jenapharm took a reasonable, prudent, and legally defensible position that represents a legitimate strategy to save the company from bankruptcy and that UMHS must be out of their legal minds for admitting liability immediately when mistakes are made? Or do you think that Jenapharm made the situation all about impersonal legal rights, potentially alienating its customers by acting strictly within legal limits, while UMHS upheld its values and put the best interests of its patients first and the risk of higher legal costs second?

Here is where things stand in the marketplace. In late 2006, Jenapharm agreed to pay 184 of the thousands of affected athletes 9,250 euros ($12,200 each) and donate 170,000 euros ($224,000) to organizations providing support to victims of East German doping.16 Admitting no wrongdoing, Jenapharm CEO Isabel Rothe said in a statement that “the agreement will avoid a drawn-out legal argument.” The long-term effect on Jenapharm’s reputation and relationship with the market is unknown. (Interestingly, a week before Jenapharm’s announcement, the German Olympic Sports Union and the federal government announced they would pay a similar amount to 167 victims. Striking an altogether different tone, union president Thomas Bach said, “We take the moral responsibility and we want to make sure that something like that cannot happen again.”) In the three years following UMHS’s decision to apologize, in contrast, medical malpractice claims and lawsuits against them dropped by nearly 50 percent and the per-case cost of defending against the remaining suits dropped 50 percent as well, saving UMHS millions of dollars. One company attempted to limit its exposure by shutting down all challenges, while the other opened itself up to challenge and, in so doing, actually reduced its exposure.

How did UMHS arrive at a counterintuitive solution like apologizing, a choice widely seen at the time as legal suicide? UMHS employs a values-based approach to pursuing corporate goals. Respect, compassion, trust, integrity, and leadership—the stated values—inform everything from the way they treat their patients to the way they treat their staff, and they articulate these values in their Seven Strategic Principles.17 As an organization whose very core was grounded in the language of values, they tackled their mounting litigation problem by asking themselves not “What can we do?” but rather, “Based on our values, what should we do?” This train of thought led them to see that medical care is fundamentally an interaction between two people—the doctor and patient—just like any other business relationship, and to examine what was “sick” in the cases that resulted in litigation. They quickly learned that the overwhelming majority of plaintiffs were generally able to forgive the error itself—doctors are only human, after all—but that the doctors who had betrayed their trust by denying culpability filled them with rage. The real illness in these cases lay in the interpersonal synapse between doctor and patient. Armed with the knowledge that the destruction of trust was contributing to retributive consequences for unavoidable mistakes, UMHS looked for ways to heal this core dysfunction; healing, after all, is what they do best. The new approach realized unexpected additional benefits as well. With the working atmosphere now free of retribution, doctors no longer have to duck and dodge to avoid the appearance of guilt when errors occur. They enjoy greater opportunity to explore what went wrong and devise innovative solutions to prevent future occurrences. The culture of transparency bred by UMHS’s new openness has brought error rates down