Mike Wojno doesn’t wait for things to happen. As president and “chief opportunity officer” of Summa Health System’s for-profit company, Summa Enterprise Group (SEG), he thrives on innovation.
“You have to be an opportunist to be an entrepreneur and not afraid to make some mistakes. It doesn’t always work logically and conventionally when you start a business,” he says.
Summa Enterprise Group creates for-profit companies in the health care field, and the profits from those companies will support medical research and the purchase of medical equipment for Summa Health System (Akron City Hospital). Wojno operated a local brick-and-block business. After the owner sold it to a multinational firm, Wojno expanded the company throughout the Midwest and nationwide.
He is the majority owner of four companies that service the concrete masonry industry, and started a local real estate development company.
As Summa Hospitals’ finance committee chairman, he discovered the hospital’s need to attract revenue to support medical education and research. He became SEG’s co-chairman with executive Stu Giller, but later stepped down from that position to become SEG’s president. He no longer serves on Summa’s finance committee but remains active on the hospital’s board.
“I address everything from SEG’s point of view as a board member: What’s right for the parent company? Never compromise the mission of that, and yet – no money, no mission,” he says.
Smart Business sat down with Wojno to discuss SEG’s creation, successes and future.
Summa says it broke the mold by hiring you to run SEG. How does your entrepreneurial background help you manage SEG better than a health care executive would?
SEG is based on market dynamics and a best practices approach to running a business. … All the businesses that I’ve been involved in … are not based on clinical qualities as a protocol; they’re based on making it in the market environment and having value. I come at it from more of a private, commercial and market side versus ‘Here’s what we do clinically.’
All the money we make goes back (to Summa Health System) to help it go to the next level in medical research, the best equipment, robotics or whatever that administration wants to do with it.
There’s a difference between playing to win and playing not to lose. If you play to win, you’re going to lose sometimes. That’s tougher in a clinical atmosphere because you’re dealing with peoples’ lives.
You’ve called SEG a “conscientious capitalist business.” How do you define that?
Capitalists are people who capitalize on situations. I (say) ‘conscientious’ because there are a lot of things you can do to make money. I’m working to give it away, so it’s not for personal gain.
If we can’t fix health care, let’s feature it in a different way. This may be the melding of best practice and capitalization, along with the fact that we’re able to provide services for the community. It might be a little altruistic but I think it’s doable, and I’m having a lot of fun demonstrating it. … To know the investments we’re making right now would have long-term payback to that mission makes me feel that I’ve made a difference.
It’s not a scarcity mentality, it’s an abundance mentality. It’s not beating the other guys, it’s meeting the market needs. … Other health systems locally have had the foresight to deal with us, even though they might conceive us as competitors. We’re doing a deal with Robinson Memorial Hospital, and we’re talking to others. Collaboration is going to be good for the community, and I’m all about that.
SEG launched two businesses in March 2003, Cornerstone Medical Services, a durable medical equipment company run by Vice President Tom Sayre, and Comp Med Analysis, a workers’ compensation and claims analysis company run by Vice President Sherrie Wyatt. What role did you play in the creation of these businesses, and how have they been received?
(Sayre and Wyatt) know these businesses like the back of their hand, so we just unleashed their passion and confidence in these businesses and acted as a platform and support structure. That’s so often the case: People have what it takes, but one, they’re risk-averse; two, they may lack the capital; and three, they may lack the process and back-office support to sustain it. So often, great ideas crash because they’re not fostered well enough.
Internally at Summa, (the businesses have had a good reception) because there’s a lot of support. People want this to work. With the board, it has been received quite well.
The fact is, this is not typical: We’ve been profitable in our first year, and that isn’t the case usually in a business. We have two predictable businesses and hired extremely good people. … I would suggest that we are about to be even more profitable in our second year.
What management techniques did you use to obtain lines of credit to start these two businesses?
Originally, as co-chairmen, Stu and I were afforded a grant … from the Summa Health System Foundation. (They ended up piggybacking Summa Health System’s line of credit and didn’t need to take advantage of the money offered by the foundation.)
We’ve been afforded certain limits. That has been a help, but starting businesses always takes cash, so that is something that we’re very sensitive to.
Right now, we’re putting together a three-year plan that would be able to go to lenders and go outside the system for financing, because if it doesn’t sell there, it shouldn’t sell anywhere else. We don’t mind supplementing our income by getting some help from the system upfront, but we will not expect subsidy – there’s a difference.
SEG’s revenue will help fund medical education and research. How do you choose which programs to support?
That’s the Summa Health System’s challenge, and that would be a good challenge to have. We’re not ready to reinvest back that way.
One of the nice things is that we’re not expected to provide that return tomorrow. This is a long-run strategy; this isn’t just some quick-hit deal. It takes patience.
If this is successful, we will have done our part to change the atmosphere in health systems across the country because this will be kind of a model. When people in other systems see it winning, there will be a sense of confidence. I’m hoping there will be some soft dividends in the industry.
Why is it important for health care organizations to think entrepreneurially?
Your reimbursables are continuing to get squeezed, so your revenue’s getting squeezed; your expenses are continuing to go up; the call for quality and sensitivity to people is going up. That puts a huge squeeze on our margin.
Unfortunately, it is a capital-intensive business … and (you end up) harvesting your assets. You don’t capitalize on depreciation sometimes because you don’t have the cash, and people are constantly getting more sensitive about supporting a community-based hospital because they’re worried about their own jobs and financial situation. We have to start thinking in terms of market-based survival. How to reach: Summa Enterprise Group, (330) 996-8847
