In this episode, Renee is joined at The Table with Carl Armato, President & CEO, Novant Health. They discuss what it means for white male leaders to be an ally and show up on DE&I. Description: During the conversation, Carl shares the many ways he has pushed to fully embed diversity and inclusion throughout an organization.
Carl S. Armato is the president and chief executive officer for Novant Health. Since joining Novant Health in 1998 as the vice president of finance and operations for the physician divisions in both Charlotte and Winston-Salem, Armato has also served as senior vice president of materials management and logistics for Novant Health.
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Renee DeSilva 0:06
Welcome back to The Academy Table. I’m Renee DeSilva, CEO of The Academy and your host and I’m happy to have you back again. In each episode of The Table we will bring you real conversations with healthcare as leaders and thinkers. We intend to broaden who is at the table while covering the issues that are critical for driving our industry forward. I’m really excited for today’s conversation with a longtime Academy member and a friend Carl Armato who is the CEO of Novant Health. Novant is a Winston-Salem-based health system. Carl joined the organization in 1998 and has held various executive roles across finance and operations until assuming his CEO position in 2012. Carl and I have had many conversations on the topic of race and how that drives culture and equity and inclusion. I think he’s a strong example of the importance of white men leaning in and owning their role as ally in the conversation around equity and inclusion. We explored Carl’s personal journey and the one that Novant has been on for the last five or plus years around equity, diversity, and inclusion and I learned a lot from how he’s approached it. In particular, I’d call out three things for you to pay attention to in this conversation. First is the critical nature of CEOs leading from the front. Carl embraces his role as not only chief executive officer but chief equity officer. He creates a space for safe conversations on really hard topics which can be a challenge for us to do, especially now in the challenging times that we live in. And finally, this notion of diversity and inclusion as not a thing, but a way to do all things. So the importance of not thinking about this as an initiative or a series of projects, but a long term commitment that is infused across every part of the organization. I hope that you enjoy the conversation as much as I did. And with that, let’s head to The Table.
Hi, Carl, so good to see you and chat with you this afternoon.
Carl Armato 2:27
It’s great to chat with you too, Renee. Thank you for inviting me today.
Renee DeSilva 2:31
Well, I appreciate you being here. I’ve said this to you off of audio and I’ll say it live, I so appreciate just your candor and the way in which you move through conversations like this. So I’m excited to talk about equity and inclusion and what it looks like to show up as a leader on that space. And you definitely lead from the front on this, so delighted to chat with you about it this afternoon.
Carl Armato 2:53
Well, thank you.
Renee DeSilva 2:55
So I’m going to start with, I did some research heading into this conversation and I learned something new about you that I didn’t know, which is that you somehow found time to write a couple of books when you were not leading the large health system that Novant is. And one in particular “A Future with Hope,” you talked about a little bit of your childhood and what I would consider to be a defining moment in that. Would you share with our audience a little bit more about that story?
Carl Armato 3:20
Well, I’ll start first too with, you know, “A Future with Hope,” for me, was an opportunity to take my life journey with Type 1 diabetes and share it with many others who have diabetes, both Type 1 and Type 2. But for those that do not know, at 18 months old I was diagnosed with Type 1 diabetes. And back in those days, it was actually before glucometers. And so, yeah, it was really a journey. And a lot of, unfortunately a lot of Type 1’s didn’t do well. A lot of them had low survival rates back then. Luckily, my parents worked diligently with me and we really focused as a family on the health of our entire family, including me as the Type 1 diabetic. So they all behaved as if they were Type 1 diabetics. But there was a defining moment for me at about 14 years old. You know, I’ve heard a lot about Type 1 diabetes, the impact it could have on me, on my life and I also heard a lot of no’s in those early years. But I was 14 and I was sitting in a chair getting my retinas examined and the doctor asked me what did I want to be in life. And I told him I wanted to be a CPA. And in the middle of me saying that, Renee, he made this sound as he’s looking at my retinas. He went, “Oh, I don’t know if I would do that. You know, a lot of the diabetics that I see today after about 20 years with the disease, they could go blind, they do go blind, and you might think about a different career.” And when I heard that, I was thinking to myself, I’m 14, you know, it’s easy to do the math, and all sudden you’re at 20 years and that’s right around the corner. So I was really depressed. I mean, I went home, my mom knew I was depressed, my dad knew I was depressed. But my dad was a remarkable man. And, you know, he actually pulled me aside, asked me what was going on. I told him the story. And he knelt down with me. He said, “Let’s kneel down in front of the couch.” I’ll never forget this moment. And he said a two part prayer. The first part was straightforward about asking the good Lord to help with managing the disease. The second part was, “Can you allow Carl to utilize the disease to help others?” And I’m confident that I’m in healthcare today because of that second part of the prayer. And obviously, it’s been a remarkable life. I’ve had no complications and that prayer did come true.
Renee DeSilva 5:55
That’s amazing. I was also noting that at 14 you had a CPA career path in your mind. That’s pretty interesting for someone at that age to even know that that was a job, per se. So, it sounds like your family was quite supportive. You talked about your dad and the moment that he sort of allowed you to see how you could use that diagnosis to also be impactful to other people. So it sounds like you come from a really good family background. I know that you were raised in Louisiana. Tell us a little bit more about your upbringing.
Carl Armato 6:27
Well, obviously, I was surrounded by a loving family. We didn’t have a lot of resources, but my mom was just a remarkable mother who just cared and cooked appropriately to make sure I had a healthy diet and a healthy lifestyle. And then I had two brothers, one older, one younger, and they just helped me get the exercise that I needed. You know, we were always out and about in the yard and we played public sports together. So it was really a family affair of both eating well and exercising together.
Renee DeSilva 6:59
That’s fantastic. I was going to comment that one of my favorite things about Louisiana is the gumbo and the crawfish and all of the stuff that you probably weren’t really allowed to eat.
Carl Armato 7:10
Well, actually, you know, my mom found a remarkable way. She always tried to convert those dishes to dishes that I could eat. So I did get my share of it.
Renee DeSilva 7:19
That’s fantastic. All right. So I would then imagine your experience with the healthcare system along the way probably also had an influence on your career path. You had your sights set on a CPA role and I know that some of your early career in healthcare was in finance functions. So maybe talk to us a little bit about how that unfolded for you from a career path perspective.
Carl Armato 7:41
Well, you know, after becoming a CPA I went to work for Ernst & Whinney who is now Ernst & Young. And, you know, I really had the opportunity to work across all industries, including healthcare. And it was one day, walking down the hall of a hospital that I realized as I glazed around and just saw the people and the impact they were having on so many individuals, it was just an eye opening experience for me to say, “You know, I think I want to be part of that kind of purpose driven organization and industry.” And from that point on I joined an organization that I was in finance and moved through finance to operations. And eventually I was recruited to Novant. Health. I’ve been with Novant Health for 22 years. And I’ve pretty much held lots of different roles starting in finance, but quickly into operations and now I’m blessed to be the CEO and get to influence the culture of 37,000 people.
Renee DeSilva 8:42
That’s fantastic. So you’re nine years into your CEO tenure. One of the things that strikes me about your approach here is, I think it was probably six years ago, maybe even more, as you were early into your CEO tenure, you really put yourself and the organization on an equity and inclusion journey. And the way that you did that, which I remember this fondly from when we first connected about it, was you brought a group of your senior leaders to an organization called the White Men’s Caucus, which I think was a bold move. So talk to us about what is the White Men’s Caucus and why did you invite your senior leaders to that session?
Carl Armato 9:23
You know, Renee, the first move though, I think that was probably one of my most important moves was actually creating a chief diversity, inclusion, and health equity officer. And I put her on the executive team, some of the highest levels of the system, reporting to me, Tanya Blackmon. And it was Tanya and I who started talking about, there was a lot we didn’t know about diversity inclusion. We had been through programs, we had been through education and training, but we had to dig deeper to figure out how are we going to get to what we really don’t know about diversity and inclusion. And so she did some research and came back with White Men as full diversity partners in that organization. And I gotta tell you, when I first heard the name, I was a little shocked and my executives were shocked. But I decided, you know, with courage, that we were going to push forward and we were going to go off site for three and a half days, and really emerge ourselves in diversity and inclusion education. And so we hired White Men as full diversity partners to join us. I had about 15 other of the top, white executives that were in the organization to join me, and they were all white men at the time. And I have to tell you, we learned a lot. That was really an opportunity for us to really take a step back and try to become so many of the other demographics and understand what they were going through in everyday life. So for example, you know, we learned about white male privilege and we really did deep dives in that kind of discussion. We learned about gender bias and racial biases. We got into really taking responsibility for diversity and inclusion. And I want to tell you, for me, it gave me the tools to really step out of my own comfort zone so that then I could go in and lead Novant out of its comfort zone to embrace diversity and inclusion throughout the organization.
Renee DeSilva 11:39
I think that’s incredibly powerful. What you’re framing is this importance of creating an ally for folks that maybe are less at the table. And you’re doing it inside the sort of power structures that already existed. And so there’s a lot of conversation now on how to be an effective ally and I think it’s remarkable that you started that journey six or seven years ago. I know, I’ve gotten to know Tanya who’s a fantastic leader as well. And I’ve heard the two of you talk about the CEO as truly the person that is the chief inclusion officer for the organization. So it sounds like this was part of that movement, got you to do your own learning, which allowed you to sort of advance the mission more broadly. Is that a fair way to play it?
Carl Armato 12:18
Absolutely. And the other thing is, I felt like we had to get white men off of the sidelines and really engage in being able to make the kind of cultural change that we needed inside of Novant Health. You know, I felt like you couldn’t just say that you were going to hire a diversity, inclusion, and health equity officer and just turn them loose like a lot of organizations have done. It really was going to not only start with me, but I needed all of my team and all of the white male leaders across Novant to engage fully to make sure it was something that was going to be embedded everywhere throughout the organization.
Renee DeSilva 13:00
And how was that received then? So when you came back from that off site, and probably some sentiment and conversation with the broader org around it? What was the general experience of the folks that went through that program and how did they talk about it internally?
Carl Armato 13:14
You know, I’ll tell you. So when I first told the 15 men, I wrote letters, I called them, I talked to them about what we were going to do for three and a half days. Renee, I wish you could have seen the faces as they showed up at this hotel, for, remember, three and a half days from 7:30 in the morning until 9:00 at night. And we were totally engaged in diversity, inclusion, and health equity. I mean, that was every minute of the day. And what I’ll tell you, some of them were really afraid. In fact, one of them got there and they said, “I just want you to know I called a board member just to check in, to make sure I wasn’t going places I shouldn’t with this White, you know, White Men’s Caucus.” And, I thought it was that it was at least a transparent and honest discussion. But I’ll tell you what came out of it, though, is that I watched, not only those 15, but I watched the white men underneath them begin to engage and ask, “How can we really make an impact?” And so, you know, I started to see changes in how we interact with vendors, how we interact with contractors, how we interact with, you know, our hiring practices and across the board. But it was because people finally stepped back and said, “Hey, I can make a difference and I can be part of this in a very positive way.”
Renee DeSilva 14:45
Yeah, what comes to mind for me as you talk about that is the power of calling people in versus calling people out. And that, to me, is what really resonates with me about that story is you create a safe space to sit in that discomfort and out of that comes a new level of engaging in conversation because people now feel like they are called into the conversation. I think that’s incredibly powerful.
Carl Armato 15:08
You know, Renee, we had some really difficult conversations. So I don’t want you to think it was easy. The challenge was, you know, there were a lot of challenges in those conversations. But I think once we all were educated and started to understand how we could make a difference, I think we saw more of a uniting approach of coming together and saying, “We were going to change Novant Health, not only the culture itself, but, you know, embedding diversity and inclusion throughout the strategy of the company was really the the outcome of that.”
Renee DeSilva 15:44
That’s right. So diversity and inclusion as a way to do all things versus it being its own destination I think is a really powerful takeaway from that. So let’s fast forward five or six years. This is, you know, we’re all, every one of us is on an ongoing journey on this. No organization, no leader is done with the learning. It’s how do you think about the next phase of that maturation? I know that you have embedded this throughout the organization, you’ve done it through even some of the compensation planning to ensure that the organization is focused on the right things. Talk to us a little bit around, where are you now in that evolution and journey as a health system?
Carl Armato 16:23
Well, you know, really, when I think about the impact that diversity and inclusion has had on Novant Health, the culture, it’s just been remarkable to watch our people and how they interact with each other, how they interact with our patients. You know, our mission is to improve the health of communities one person at a time. And I really believe that if we could embed diversity and inclusion appropriately inside of Novant Health, that we would absolutely be able to deliver on that mission in every community, every zip code, regardless of where people live. So what I’m proud to tell you is that when I look across Novant today, health equity is something that now has become an everyday part of life in our organization. So I no longer have to ask the question about health equity. What’s happening is, you know, we’re winning awards on quality and safety and outstanding performance. But our physicians, our administrators are working together of looking at every diagnosis, every discharge, of looking at health disparities across all of those areas of our system. So, for example, you know, we saw an example where just pneumonia patients that were discharged from our facilities, there was roughly a 6% higher rate for African Americans of being readmitted than those of Caucasians. Well, we’ve developed Business Resource Groups that go out into the community to understand what were African Americans experiencing differently than every other demographic that we have. They came back and told us two things in that example. One was discharge instructions needed to be changed. And then second, the follow up, specialty care, and subspecialty care needed to be addressed. And we made those adjustments. And here’s the remarkable thing is that not only did we eliminate the health disparity of 6%, we actually reduced and improved the health of the entire demographics in all people. And we actually lowered readmissions in all people for pneumonia. So now we’re doing that for every specialty, every institute. And all of that in such a coordinated way with these Business Resource Groups, with the diversity councils that we set up, with our 30 or so diversity educators across the Novant Health System. And so we’ve got really a unified system that not only believes in diversity and inclusion, but it’s actually bringing it to life in everything we do every day, particularly in delivering remarkable outcomes.
Renee DeSilva 19:12
What’s notable to me about that, there’s sometimes, they is often, I would say, it’s still a conversation around what is the return on investment? Or what is the business case of investing in equity and inclusion, which I think is just, it disappoints me that we’re still having to ask that question. But if we need to ask that question, I think your example here is a great one where you saw an overall drop in readmission rate that really impacted the entire community. So I do believe there’s power if you mind the gaps, right? You find power and can drive a change agenda through that does deliver on that one person at a time mission. So I think that’s a really powerful example of how that comes to life.
Carl Armato 19:53
Absolutely, absolutely, Renee. And to your point, I mean, you know, we’re all in health care to help communities and individuals become healthier. And the fact that we can not only go into zip codes that are underserved and make them healthier, but in turn make the entire community healthy is a win for all of us. And so that’s where I really do see a remarkable business case. And there’s a lot, there’s lots of other examples that I have where we’re addressing, for example, right now, we’ve got long term goals that are in our compensation model that are going after looking at Latina women, Asian women who are not getting mammograms compared to the rest of our demographics. And we’re learning a lot about the culture through our Asian Business Resource Group. And what’s coming back is we’re starting to make a real difference and a change in not only getting the Asian women and the Latina women the mammograms in a timely manner, but the entire demographic of patients getting mammograms, that whole group has actually increased tremendously. So it’s just another example of how we can keep communities healthy and proactively keep people well.
Renee DeSilva 21:15
So you mentioned a couple of times the Employee Business Resource Groups and I think you use them or you leverage them in a pretty powerful way in that it’s not just about what’s happening in the four walls of Novant. And I know, it’s more than four walls, but it’s not just happening inside of the health system. It’s almost an outside approach where you use those folks to come back with insights from their community. Can you elaborate that further, because I do think that’s an innovative way to deploy Employee Business Resource Groups and just wonder if you could bring that to life a bit more.
Carl Armato 21:42
You know, I’m really excited about these Business Resource Groups. And by the way, I meet with them regularly to get report outs. So not only do I get the report outs, but I also get to help them set the strategy for the next year of what each group is going to work on. You know, so for example, we have I think it’s over probably 15 or 16 groups that cut across all demographics. You know, and I’ll say, when I say all demographics, I mean every demographic when you start to look at diversity and inclusion. So for example, our LGBTQ Business Resource Group, they’re out in the community and they’re trying to find ways to open the door for all individuals that participate in that, you know, are eager to find healthcare that is comfortable for them and it meets them where they are and meets their needs. And so, you know, what we’re seeing is these Business Resource Groups are bringing us such valuable information on how to make the experience remarkable across the entire demographic of patients that we serve. And for me, that’s just been so helpful to watch how our patient experience has actually improved across the board, our safety and quality has improved across the board. You know, so Renee, I’m going to tell you, these Business Resource Groups are not only vital to the success of a diversity and inclusion program, but it’s been so vital to the success of the entire operations of Novant Health.
Renee DeSilva 23:15
So what I love about your approach is that you appropriately treat diversity, equity, and inclusion issues as a strategic imperative. And so I want to maybe pull up a little bit and think through what else is on your mind in terms of major imperatives, major forces that are impacting the industry? And how are you thinking about that as you sort of chart Novant’s strategy more broadly?
Carl Armato 23:43
Well, I think, you know, when I think about strategic imperatives across Novant, you know, I always start with our people. And I start there because if you think about the impact that whether it’s physicians, nurses, support staff, administrative individuals, just the impact that COVID has had on the pandemic has had on the well being of our people. So, you know, my first strategic objective has been to build a resilient team, a resilient, change-ready team and culture. And I will tell you that diversity inclusion has played a significant part in that change ready, in that inclusiveness approach to teamness and teamwork. And so I will tell you that that’s number one. Second is, it’s about wellness and going into communities and dealing with not only the health of a community, but the social economics that we are all looking at – the social determinants of health and all of the different areas of there that impact that, which diversity and inclusion has a significant role in understanding how we are going to drive value through population health by understanding the community, the people we serve. And so, you know, I tell you Renee, there’s not a strategy that I would mention that we’re working on at Novant Health, where diversity and inclusion doesn’t have not only a vital part, but is embedded everywhere. So I think about the resiliency of our team members, I think about population health and value based care, I think about even when we’re looking at how we contract and things that we do to offer new services in communities, all of that is surrounded through a lens of diversity, inclusion, and health equity. And I just share that with you that what I’ve found is there’s nothing that we’re working on strategically that diversity and inclusion in that lens is not brought to the forefront.
Renee DeSilva 25:47
I know that recently Novant acquired New Hanover Regional Medical Center. And if I have this right, I think New Hanover delivers rural care for a significant portion of your state. And so, to me, that’s another lens on equity and inclusion. So I’m sure you’re getting deeper on the needs of healthcare in rural communities as part of that mission that you’re on, is that a fair statement?
Carl Armato 26:10
Absolutely, Renee. You know, the other thing I was going to tell you about what I’m looking at as we cut across rural areas and even communities and zip codes that we’re trying to open up access to healthcare to, you know, it takes also a lot of partnerships and relationships. And not only with many of the not for profits that are already in the communities that we’re working with, but, just for example, partnership with Michael Jordan. You may have seen that, but, you know, he’s offered us $17 million. And we started two clinics in Charlotte in underserved areas and it’s beyond just primary care. They incorporate behavioral health and then they get at the social determinants of health. We’ve got food pharmacies and we’ve got other, you know, social services connected into those clinics. And now, you know, in Wilmington, Michael has asked us and has agreed to build two of those clinics in Wilmington. So we’ll have four and, you know, he’s been just such a remarkable partner and the Michael Jordan Family Clinics have given such an opened up access to healthcare. It’s allowed people not to show up in the emergency room. And it’s really got people on more of a wellness approach to really staying healthy in our community. And Michael and I did a webcast the other day and we had a couple of patients that joined us. And he got to listen to the impact. One of the patients was a diabetic and got to share their story. One was a patient that had congestive heart failure and got to share their story. And Michael actually teared up. And at the end he said, “You know, this is the impact I always wanted these clinics to have and I want to do more.” So it just tells you that when I look at a community and I look at the future of where we’re going, it’s not only going to take health systems like Novant Health, but we’ve got to partner with other nonprofits and other, you know, organizations to help us make sure we’re reaching everyone in the community.
Renee DeSilva 28:12
That’s such an important mission and I’ve been excited to track the work that you’ve done there. And anytime you want to bring Michael Jordan to an Academy meeting, we’d be delighted to have him.
Carl Armato 28:24
That’s awesome. Yes.
Renee DeSilva 28:26
All right. So I want to go in a little bit of a different direction and ask you just about your broader leadership observations or lessons. You talked a lot about the importance of building a change-ready and agile workforce. You talked about building in resilience as part of that. I wonder if coming through COVID and that response, or even just broadly across your career, how would you reflect on just the elements of, in particular, crisis level leadership that you’ve had to lean on across the last 12 months or so?
Carl Armato 28:55
You know, I was thinking that that’s a really great question, Renee, because, you know, you don’t want to always have to operate in a crisis mode. But I was thinking about my career. And it started even when I was a CPA at Ernst & Whinney. You know, the tax department had fallen apart and I got a call from the managing partner. I started an audit and he called me in and he said, “Carl, you know, you’re the only auditor that took corporate and individual income tax. And, you know, we need you to do tax. You made A’s in it and we need to send you into tax.” And so I was thinking about there and then in healthcare, I tended to charge places and go places where most people wouldn’t want to go initially. So I would find parts of the organization that were losing money and I would volunteer not only to be the finance, you know, liaison, but I also then eventually volunteered to go into the operations of those areas. And it was almost like rallying a culture of people to deliver a new outcome, a changed outcome, a better outcome for everyone. And so I would tell you that all of my career has probably prepared me for COVID and operating in this environment. And I will tell you that because I did and we did and my entire executive team embraced diversity, inclusion, and health equity early and built a culture of people that were ready for something like a pandemic, I can’t imagine not have had experienced that kind of education and training and the cultural influence and the change that we made early. I think it prepared us all, including myself over my career, to be ready to make this kind of impact at this kind of time.
Renee DeSilva 30:52
It’s fantastic. All right, I think I have one more question for you to wrap up. So in this season two of The Academy’s podcast, I’ve renamed it to be called The Table. And my rationale for that is, I think there’s power in getting new voices to The Table and telling stories of people who maybe don’t always have the platform. And so I want to chat with folks like you who have the national platform, but I’m really curious to cultivate new voices around The Table as well. And then my second reason for that naming convention is just that so much of our joy as people, as humans come from when we’re around the table, people that we care about, we’re having good conversation. And I think we all miss that through the last year. So my question for you in that vein would be, if you could invite any two people for a conversation at your table, who would they be and why?
Carl Armato 31:44
Wow, that’s a tough question. You know, originally, if you asked me that, you know, I was thinking about the people who’ve had some of the biggest impacts on me. Of course, two of them are not alive so we obviously couldn’t ask them, but my dad and probably Mother Teresa. I just think about them. My dad had a philosophy that you always look for someone to help each and every day. I was thinking about Mother Teresa. She always talked about, you don’t worry about the numbers, you just try to help people and always start, you know, with someone that’s close to you or right next to you. You know, but I think there’s so many people today that are bringing the kind of impact in remarkable ways on people. So, you know, if you couldn’t have those two, I would tell you that, you know, I would think about what’s going on across the world. Let’s look at some of the doctors that have made such an impact on COVID. I’d love to talk to, you know, the two doctors who were so engaged in recognizing the COVID vaccine. I’d love to talk to, you know, Michelle Obama about just how calm she stays, it looks like during any crisis. And so, I mean, there’s just, to me, there’s an example of people who, the smallest impact seems to have sometimes the largest effect on the world and those are probably the individuals I would want to focus on.
Renee DeSilva 33:15
That’s fantastic. Well, I’m very grateful that you joined us today at The Academy Table. And hopefully I will get to see you in person at some point in 2021, but it’s always a pleasure chatting with you, Carl. Thank you so much for joining us today.
Carl Armato 33:28
Thank you, Renee.
Renee DeSilva 33:30
Thanks again for joining me at The Table. The Table is a podcast produced by the Health Management Academy. Make sure you catch future episodes by visiting our website theacademytable.com or by subscribing on the podcast platform of your choice. And if you have suggestions for topics or guests, I’d love to hear from you. Please drop me a note at email@example.com. I look forward to talking with you soon.