This week on the podcast, Brent sits down with Marcy Doderer, President and CEO of Arkansas Children's where she leads the state of Arkansas' only pediatric health system serving the children of Arkansas and beyond. They begin by discussing the unique aspects of pediatric healthcare, including the wide variations in patient size and conditions that drive increased costs. Marcy shares how she is focused on innovation to find new solutions while maintaining incremental improvements in care delivery. She offers leadership advice on authenticity, being a student of your work, and how everyone can lead from their role. Marcy also talks about the mission-driven culture at Arkansas Children's and her aim to partner across the state to elevate child health.

But to actually heal a child, you need inventive

spaces, creative spaces, and artful spaces that allow the

child to still be a child in the midst of all their health care.

And that costs money. Our spaces are designed differently. Our

technology is different and it's all costly.

Welcome to the Be Epic podcast, brought to you

by the Sam M. Walton College of Business at the University of

Arkansas. I'm your host, Brent Williams. Together, we'll

explore the dynamic landscape of business, and uncover the

strategies, insights, and stories that drive business

today.

Well, today I have with me Marcy Doderer, who is the President

and Chief Executive Officer at Arkansas Children's. Welcome,

Marcy.

Thank you. Glad to be here, Brent.

Well, I'm glad to have you on the podcast.

We've known each other for several years. It's great to

reconnect and hear about the wonderful things that you've

been doing at Arkansas Children's.

We do have a lot going on. That's for sure.

And you just celebrated 10 years in the role,

right? What's some of the highlights?

So 10 years this week. I moved here in July of

2013. And I don't think I wasn't that I didn't expect to be here

for 10 years, but I'm not sure I fully expected 10 years, I

certainly didn't know where we would be 10 years from now.

Well, what what are some of the highlights of of

the 10 years as you look back? I'm sure you've kind of

reflected.

Absolutely. And probably one of my proudest

accomplishments with Arkansas Children's is that we are now a

two Hospital Health System. That may not sound exciting to some

people but Arkansas Children's Hospital have been in Little

Rock for over 110 years now. And five years ago, we opened

Arkansas Children's Northwest in Springdale, a small community

Children's Hospital, really perfectly situated in the

Northwest Arkansas region and serving the needs of those

children every single day. It has been so successful, we're in

growth mode, and will soon put shovels in the ground to expand

that facility.

Well, wonderful. Well, you know, you sit in an

interesting space in Arkansas being the only system health

care system that primarily serves children and pediatric

community, what are some of the unique aspects of serving that

particular population?

We've always been in the business of child health

and child health care, we think about health care, as you know,

being able to catch the sick and injured when they come to us for

care. But we also want to make sure we're actively engaging

with partners across the state to elevate the health of

children in Arkansas. We've done this pretty remarkably, by

trying to get further and further from Little Rock and out

and about. So we have primary care clinics in Pine Bluff and

Southwest Little Rock, an active clinic and Jonesboro, a home

visiting system that touches all 75 counties, and of course, the

two big hospitals, and another clinic in Benton County. So

we're trying to be as close to kids as we can. Our ultimate aim

would be to be within 60 miles of every child. And it's not

because we wish to own and operate every kind of child

health business there is but because child children are

really our future. That sounds pretty cliche, and maybe a bit

trite, but we are experiencing a moment in time where the human

race is not replacing itself. Birth rate is declining pretty

steadily year over year. And there will not be enough kids to

become adults to take care of you and me when we're old. And

so our stance is that we really have an obligation to stand up

these kids and help them reach their fullest potential, 700,000

kids in Arkansas, we we as a health system might only take

care of 180-200,000 of them individually. But I think we

could actually be instrumental in creating a fabric of services

to ensure that kids get the health and are can achieve the

health status they really need.

You know, Marcy, I'm sure you're highly aware

clearly of population decline because of being focused on

pediatric health care. I'm aware of it because being focused in

higher education, of course, you know, that as children grow and

graduate high school, that's who's coming to the university.

Do you feel like business leaders that you engage with are

really aware enough of on this issue that's out there?

From my perspective, it's not top of

mind for very many business leaders. They're looking deep in

their here and now and certainly coming out of the pandemic,

global business environment has been extraordinarily difficult

to lead in and lead within and I'm not sure people have stopped

to think about long term impact on population trends and their

workforce. Every business I think across our country is

worried about the workforce of today, we've struggled to fill

critical positions, unusual things like pediatric ultrasound

technologist, but also mainstream things we can't find

staff accountants. You know, so the workforce of today is

challenging, it's only going to get worse. And I think if we

could elevate this conversation among the business community,

and the education community, together, we could figure out

how we're going to take fewer people and make them better

prepared to deliver the kind of work we will need 10 years, 20

years, 50 years from now, service industry, retail

industry, the medical industry, technology, whatever it might

be, every one of those industries will have fewer

people to work in their spaces. So what can we be thinking of

now that actually replaces the need for the human hand in a way

that still allows work to be engaging, fruitful, inspiring,

and attractive to people who will be working.

Absolutely. And if and I guess as you're, as

you're thinking about that, and in your own business, or you

know pediatric systems throughout, you know, the world

probably that you're engaged in, I'm sure automation, generative

AI, those types of technologies are on your mind and how you're

gonna, I guess, bring those alongside your people to solve

some of those.

Absolutely. And I can give you an example that we

worked on in the last year. It's very healthcare specific, but it

was leveraging automation in business systems. In healthcare

when you have a government payer as a major source of your

revenue stream, which we do at Arkansas Children's, Arkansas

Medicaid is our primary payer, you have a series of what we

call cost reports. It's a year end auditing process of

assessing what it costs us to deliver care for the Medicaid

kids that we took care of. And it's a very involved, detailed,

lengthy way of reporting back to the state, what they owe us for

the care we delivered and what it really costs us to deliver

that care. It's been a very manual system. Since the

beginning of time, it feels like. But between our

Information Systems team and our Finance team, they've been able

to really, almost fully automate how federal and state level cost

report gets populated. That may not sound very exciting to

anyone. But what the reality is our team who works in cost

accounting, they don't want to be data manipulators, which is

what they've been by completely automating the process, their

checks and balances of the cost report is reduced significantly

in terms of man hours, allowing them to change their view and

really be the data analyst that they are. And I think every kind

of rote, mundane kind of business function that we could

automate, to allow the people to be the thinking, creative minds

that a human can be, every business will benefit from that.

AI is a little interesting, one, I think it's here to stay. And

it's actually going to just boom, it's very scary to some,

because I think people feel it may replace people in their

work. But it definitely has a role. And there's, again,

there's some rote kind of work that we do that we think AI can

be extraordinarily helpful with, we think of all the

documentation that occurs in a healthcare transaction. When you

visit your own personal physician, she or he is having

to document deeply in a medical record to assess current state

and your problem list and what the prediction or prognosis is

for the future. There's a lot of ways AI can help with that and

make that easier on the provider, giving them

opportunity to spend more face time with you. But there's some

also, I think, really interesting, unintended

consequences of that kind of AI. And here's another example that

we're kind of wrestling with in health care. We can use

automation and a form of AI to help our radiologist read

routine and simple radiology images. The idea was to free up

the radiologist, the human, the medical doctor, to spend their

time really focusing on the unusual imaging services that

are really acute and need immediate attention. MRI and CT

and brain scans, tumor scans heart issues. Well, what they're

finding though, is the human brain works best when it has

some lulls in its day and by removing all of the routine

chest X rays or plain film orthopedic images, we're forcing

radiologists to spend their 8, 10, 12 hours a day looking at

the really intense stuff. And it's overwhelming to a person's

brain, it's exhausting. And so we actually need to come back to

some a little bit of a middle ground because behavioral

scientist and brain scientists also know our brains like a

little downtime, not to be just on a break, and not engaging in

anything, but to allow the brain to kind of operate a bit on

autopilot. So I think there's some unintended consequences of

trying to automate everything and forcing people to just the

highest function, because we may burn them out even faster than

we're doing today.

How interesting. That's a very interesting

example, you know, and backing up, I would say, I totally agree

with you of the exciting thing I think about the development of

technologies like AI, generative AI, is the ability for humans to

no longer have to do many of those rote tasks and use their

creative abilities that only a human can do. But I think as as,

as leaders and managers, and I heard someone say this,

actually, this week, can use the word harmonizing technology and

people.

I like that phrase.

Yeah, me too. It really, it really stuck with me.

And I think that's sort of what you're saying with this example.

Like, how do we get technology and people working together in a

harmonized way, so that both can be best utilized, and so that

the person can get the most joy out of the work?

You think about healthcare, particularly in

hospital care. When a child is confined to a hospital room days

on end, and they're still aware of enough of their surroundings,

they really look forward to engaging with people. There's

some rote tasks that we've thought about replacing with

robots, delivering a patient's food tray, for example, pretty

simple technology, it's out there, it's being used today, a

robot can, you know, the thing can be loaded with the patient

trays in the kitchen, it knows how to move up and down the

hallways and up and down the elevators and can stop outside

the room. So a parent or someone could get their tray. But if you

remove the opportunity for the people who usually deliver to

the tray to stop and engage with the family, and really check in

on the emotional status of that child, not just the blood

pressure, the temperature, that kind of thing, we might actually

dehumanize healthcare and that we don't want to do that. So I

love that concept of harmonizing the technology with how we're

delivering care.

Me too. Well, you, you lead an organization in

a challenging space in healthcare. And you know, many

of you are probably aware, we're all engaged in healthcare as as

people and consumers, but I'm not sure if, if everyone

listening would understand the real challenges of trying to

operate in that system, med. You know, I thought maybe from your

perspective, like what are some of the key challenges that you

all face as you as you operate within this US system?

Well, healthcare is highly regulated. And those

regulations create a burden, an administrative burden that

doesn't always come with a revenue stream for us and every

hospital in the country is faced with that not just pediatric

health care. But I do think it's amplified in pediatric

healthcare because our, the floor of our cost structure is,

unfortunately, by design higher. So more costly than in a

traditional adult hospital, for a number of reasons. Start first

with people. We need people who are actually trained in

pediatric specialist specialties to take care of kids. Our

children have a different anatomy, different physiology,

different medical needs. I mean, their diagnoses are literally

different than in the adult space. And people need to get

trained to take care of kids, not just adults, and that

training takes more time. Therefore, it costs more money,

a cost structure goes up. When you think about our slot supply

chain, we source our supplies many times from the same vendors

and places that an adult hospital is but we actually need

way more supplies than an adult facility. So think just in terms

of blood pressure cuffs, and I actually wish we're on a podcast

but I wish I could show visual aids because it's pretty

impactful. Any day, anytime in a children's hospital we have

micro preemies, so babies born that way less than a pound. And

we might actually have a 500 pound teenager suffering for

more morbid obesity. So we would have a blood pressure cuff

that's about the size of a band aid that can fit on a premature

infant. And then we need a blood pressure cuff that can fit

around the arm or the leg of a 500 pound person and every size

in between. Well multiply that by oxygen masks, tiny, tiny

oxygen masks, full size oxygen oxygen mask, multiply that by

diapers like a diaper, that's literally the size of a post it

note to a full size, extra extra large depends for an

incontinent, bigger person, and everything in between. So the

cost of inventory, the cost of our supply chain is very

different than adult size. From a capital standpoint, the same

thing is true from hospital beds. Bassinets designed for an

infant to a bariatric bed designed for a 500 pound person.

And it just goes on and on. And that creates a layer of costs

that doesn't happen in the adult world. And I can say that with

ease was actually worked in adult hospitals, I've had the

experience of being in a 700 bed, academic hospital in a

large urban town, those kinds of things make it very different.

The people are different, the supply chain, the things are

different, and then the spaces are very different. And that

makes our burden of delivering high quality, low cost patient

centered care, more challenging, I believe, than in just a

general adult community hospital.

You know, I I had never thought about the

variations, you know, physiologically, I guess in in

your patient relative to adult it makes sense clearly when you

say it, but when you hear pediatrics or children or adult,

you kind of think one or two. But wow, what a you're right,

you're dealing with a vast variation.

The last piece I would land on there that I think

is such an exciting field in medicine right now. And more

costly than I think the average Arkansan would even understand,

medical technology, medical science, and research and

discovery have been creating novel pediatric drugs,

pharmaceuticals, to solve for conditions that were fatal in

the past. Neuro, neuromuscular conditions that children are

born with that children don't live to be, but maybe two or

three years old. There are now not just life altering, but life

saving drugs that we are delivering to these children in

Arkansas and all over the country, probably the world.

Single doses of those draw those drugs are seven figures. So a

million dollars or more per dose. And that's not just cost

on the hospital, right, we would negotiate that with payers, we

work with sources of revenue to ensure that the drug gets paid

for back to the pharmaceutical company. But that's not a

sustainable future for us, except that it is a sustainable

future for that one child who now will live. And for that

family who sees hope. And so that that's a fascinating,

probably just in the last five years, piece of our world that's

becoming more and more challenging to maneuver that

everyone wants to figure out how we're going to navigate that

space, because we're going to actually save children's lives

and going back to the population decline, we need to save every

one of those children's lives.

Absolutely. Well, I assume you know, working

in pediatrics that that your team is a very mission driven

team, purposeful team. You know, as as I've gotten to know, we've

worked together over the last, let's say, five or six years. I

know, you know, it seems to me like you've had a significant

focus on innovation and driving innovation in the organization

or equipping maybe your leaders and teams with innovation. You

know, how did you, what was what drove your recognition of the

need for that? And how have you gone about it?

It's a great question. And I don't know that

I have a perfect answer for you. I I'm often viewed in my CEO

colleague space is a bit contrarian in the world of

innovation in the past, because people in healthcare, love to

think we are incredibly innovative. In the moment in the

delivery of care, I would state quite firmly that we are not

often innovative. We're great at incremental improvement. The

margin of error of pediatric healthcare is really small. And

not many families would say they want to be the first. And so in

the care delivery system in the hospitals in the clinics as we

talk to families, we are incrementally better, really

well. We have great improvement science techniques. We are very

robust in our process improvement and process design.

And we need to keep that going in the moment of care. But it is

also true that we have got to come, we have to be able to

create space that allows teams to really think innovatively in

a way that isn't just improving today's solution. It really is

completely different. So we have invested time in trying to seek

out champions for innovation to create free up space, I guess is

the best way to say that in one's day to learn about how to

think differently, learn how to be innovative, to give them the

tools to really explore a very different solution, rather than

just exploring a better way of doing what we're already doing

today. And I'm hoping that makes sense and isn't inarticulate on

a podcast. So we've, we've partnered with the University of

Arkansas, we've partnered with the University of Arkansas for

Medical Sciences to think about how you take clinicians who are

so good at incremental change and break them away from that

and give them a space where they can actually do transformative

change. So we do that by building, the even at the core

of our work, a culture that's built on discovery and

curiosity. So when I interview people I'm looking for what was

the last thing you learned that was new? How did you learn

something new, whether it was work related or not, trying to

assess for a team members interest in their curiosity

level, in their interest, discovering something new and

doing things differently and I think, if we do that senior

leadership, or we do that with frontline leaders, or frontline

staff, we can create a culture that is naturally geared towards

discovery and insightful ways of looking at things that will

promote innovation in a very different space.

That totally makes sense to me, the way you

explained it. Really trying to give your team space that allows

them to think outside of your lump and, and transform them

together. So totally makes sense to me. And we've been pleased to

be a part of that. Maybe, maybe transitioning to leadership. You

know, I mean, when I when I when I think about interacting with

you over the years, clearly we've interacted around

innovation, but I love your style of leadership. And as you

as you think about our students, Marcy, you know, the Sam M.

Walton College of Business is really producing the next

leaders of the organizations throughout the state and region.

You know, what, what advice would you start to give them?

Maybe let's start with leadership. And like, how do you

develop and how did you develop your own framework of

leadership?

I think I was drawn to leadership really,

really early in my life, which may not be a typical path. But,

if you were to rewind the clock all the way to high school, I

always lifted my hand to, you know, be nominated for an

officer in a high school club. And

Were you in the first row of the classroom?

Many times. Sadly. My mom would tell you

that, you know, as a five year old, I was the one going, I want

to say why, I want to determine the why. And I think that was

what drove me. I really had this innate curiosity to always want

to understand why and then realize, you know, what, I could

define that why maybe better than others. So that drove me

into leadership. One of the things that kept me in

leadership really has been this passion I have for developing

others and helping people see, you can be a leader from any

seat you sit in. And I think that's an important lesson for

students. Not everyone wants to be a CEO, not everyone can be a

CEO. I mean, it's a pretty steep pinnacle, right? There's only

one at the top. And so, you don't have to reach even the C

suite to be an extraordinary leader. And leading is by

creating that vision for a group of people who will follow you to

do something better and improve on whatever whatever it is,

whatever business you're in. My own experience in leadership in

terms of success is leading first with authenticity and

integrity. I think that was pretty natural for me, but it

was rein- reinforced by mentors I've had through my career. And

I think sadly, women sometimes get steered a little differently

that they they a persona around them that they think the world

is expecting and they leave a bit of their personal life or

their personal approach to the side. And I would never

encourage anyone to do that. Well one lesson I learned really

early in my career was kind of battling a bit of that. Being a

little worried about being the only female voice on an

executive team, which I had the experience of, and thinking I

needed to frame my thoughts and my interjections the same way

all of my male counterparts were and yet that isn't the tone of

my normal voice, in terms of the cadence of the words or the way

I think or the way I might problem solve. And when I got

comfortable with self that wasn't an outside world telling

me to do that it was internal, and just decided to be myself

that it was almost as if the team around me was like, well,

thank goodness, Marcy is now here, you because they knew me

in that way individually. And then I'd get to the big table,

and be a bit cowed by that. And I think finding your own voice

and leading with that level of authenticity, the teams around

you will welcome that. Yeah, it won't be perfect, but nothing

is. I would also suggest you be a student of your work. I have

had that conversation with team members. People often comment,

how do you remember that stuff? How do you know those numbers so

well? I've been a student my whole life. I'm 55 years old and

10 years into this CEO job and I still study our work every day.

I mean, I spent time yesterday really looking deeply at some

statistics around food insecurity, just so I could

understand it differently because of a conversation that's

coming up. And there's a lot of noise in our world telling us to

know certain things or to be certain ways or to be pulled in

different directions. And if students or young leaders, new

grads in their first roles, can learn how to put a lot of the

noise aside and be a student of what it is you wish to do, what

you are doing today and what it is she wished to do in the

future, you will know your work better than anyone else. And

with that will come growth in your career.

Well Marcy. I love the viewpoint on

authenticity. Each one of us are individuals, we're unique, we

bring something unique. And that's actually what can make an

organization and a team really special is when everyone brings

those experiences and their unique self to bear and and then

that mixes together and creates a pretty unique history.

I went it was reinforced for me just recently,

I was out rounding, I do this a lot to get out of my office and

go spend time on one of the patient care units. And I was on

one of our medical units a few days ago, and there was a new

member on the team and I stopped and I she looked a little

frightened that I walked up to her I had a business suit on and

you know, didn't wasn't wearing scrubs. And I said hi I'm Marcy,

I said I can tell by the color your scrubs you're one of our

student interns this summer because our team members are

color coded in scrubs, which really helps me know what they

do. And she kind of had a little frightened look on her face and

one of her teammates and I think was her preceptor Kelly walks up

and puts her arm around her. She's like, don't worry. That's

just Marcy. She's one of us. You'll get to know her as you

work here. I was like thank you, Kelly. I appreciate that. And

then I visibly saw the shoulders relax on the student intern. And

she told me her name. And I welcomed her at Arkansas

Children's. But Kelly, the team member was comfortable doing

that for a CEO because she knows me. And that comes with leading

with authenticity.

Absolutely. Well, Marcy, I want to say thank

you to you and to Arkansas Children's for the way that you

serve our state and should be the future of our state.

Thank you so much. I have the best job in the

state of Arkansas. And Arkansas Children's has such a bright

future as one of the preeminent health care systems in our

state. And I think the children of Arkansas will be better for

the work we will do as Arkansas Children's but more importantly

the work Arkansas Children's will do in partnership with

people like you and the University of Arkansas

partnership with business and other community advocates who

are out there wanting to make sure every child can reach their

fullest potential. So thanks for your time.

Absolutely. Well, I know one thing we share

and that is a passion for the future of this state. So thank

you for joining us today.

Absolutely. Have a great day.

You too.

On behalf of the Walton College, thank you for joining us for

this captivating conversation. To stay connected and never miss

an episode, simply search for Be Epic on your preferred podcast

service.