Leading Strategic Change at DaVita:
The Integration of the Gambro Acquisition

Purpose of the Case:

1. To provide an opportunity to design a merger integration process.
2. To discuss the features of a successful transformation process.
3. To examine how one organization compares to the Built to Change principles.

Placement in the Course:

The DaVita case comes at the end of Part 6 in support of strategic interventions. It is a very interesting strategy case that has a strong human resources and culture them running through it with three purposes. First, it invites you the students to design the integration activities associated with a large acquisition. DaVita is acquiring the Gambro organization which will more than double the size of DaVita. Second, the case can also be used to discuss the transformation—cultural and organizational—of the DaVita organization from Total Renal Care. Finally, DaVita has put into place many of the features associated with a Built to Change organization and there is a good opportunity to see how those principles might look in practice.

Overview of the Case:

DaVita is the second largest kidney dialysis treatment services organization in the U.S. It is important to understand the work they do and the instructor might want to go the Internet and get pictures of a treatment center to show the students what this organization is up against. A dialysis patient must come into one of these centers 2-3 times per week, and sit for 4 hours at a dialysis machine with needles poked in them to get their blood cleaned. One quarter of the patients die within a few years of beginning treatments. It’s a tough place to work in the best of circumstances.

The case opens with a summary of the current challenges facing DaVita, including the integration of Gambro, continuing to grow the organization, and handling organizational issues such as compensation. It then overviews the history of the organization and its transformation from Total Renal Care to DaVita. Total Renal Care was within days of not meeting its payroll and the transformation is an impressive one. Finally, the Gambro acquisition is described and the challenges associated with this change are summarized, leaving open the task of how to integrate the two, very different, organizations.

The DaVita Transformation:
Answer the following 4 questions in a 3 page paper using APA formatting.
1. What was the situation facing Kent Thiry when he took over as CEO of Total Renal Care?
2. What were the purposes of the transformation? Do those purposes differ from other transformations you have experienced or heard of?
3. Why focus so heavily on values and culture in the turnaround?
4. What was the DaVita’s strategy and what did they do to reinforce that strategy in their culture and values?

One of the references should be from the text. Here is the APA for it:
Cummings, T. G., & Worley, C. G. (2014). Organization development & change (10th ed.). Stamford, CT: Cengage Learning.