HealthCare Voice

To Journal Or Not To Journal

DALLAS, Texas (Dec. 28, 2008) -- Journaling is a trendy sort of thing. I know people who have been doing it, religiously, for years. Others started but did not stay with it. It is like a routine of physical exercise, I guess. I know others who have started after taking a journaling class. Interesting. I did not know there was a class for something like this – teaching you to write thoughts and ideas in a book.

My interest in journaling did not come from a lofty notion that I had something important to say, recall or reflect upon. No, it was much more superficial. It was a picture in a magazine of a great looking leather notebook and a beautiful pen (in what you write, and with what you write, is very important to some journalists). A rugged looking model posing as one of the world’s great adventurers/writers was making notes while sipping what looked to be a glass of expensive single malt scotch. That was the purpose of the magazine advertisement, not the merits of journaling. That leather journal and the pen made an impression. Then during one of my frequent business trips – not to Africa or some exotic Far East destination, but Wichita -- I saw someone else making notes in an interesting notebook. He, too, was using an interesting looking pen. Then I heard a speaker at a leadership conference talk about the value of reflective journaling. I learned that some of the most celebrated leaders in the nation -- in business and the military -- journal on a regular basis

I began to think about the idea from time-to-time. As a former crime writer and investigative reporter for a major Texas newspaper, I missed the “art” of writing although there are those who would argue that this type of writing – a report on some bloody killing or bizarre auto accident – is really 250 words in short declarative sentences organized in three or so paragraphs masquerading as tomorrow’s history. About seven or eight years ago, I began to make notes in the classic spiral notebook on how I could improve my business and my life, as well as notes on tasks for the next day – something that I do more and more frequently as my hair continues its march to total grayness. Occasionally I wrote something that was good but most of the time I rarely went back and reread the previous entry's musings, except to look at my notes for the Outlook calendar. Then I met Rand Stagen,Senior Partner at Stagen, a Dallas-based management consultancy. Mr. Stagen helped me connect the concept of reflective journaling and improving as a leader – Chairman and Founder of a JohnMarch Partners -- an executive search firm. He believes, and I am now a Stagen devotee on this issue, that there is a correlation between the discipline of reflective journaling and an executive’s ability to master the art of next-level leadership. To read more about this deeply important leadership concept and download a copy of this white paper, visit his web site.

I am no next-level leadership expert as I am clearly about to demonstrate, but borrowing from Mr. Stagen’s excellent work is very helpful when I talk to students in graduate healthcare management programs. I frequently use one of Rand’s great examples: the head football coach. Television cameras cut to a close-up of the head coach on the sideline at crucial times during the game, plotting his next move. Stagen makes an important point – that he may have the final say in calling the next play, but the coach has the worst seat in the house – at field level, which precludes him from gaining any perspective with regard to how his offense is being defensed. However, he does have a headset and he is talking to a member of his coaching staff who is located in the press box high above the playing field, Stagen writes. That coach may not be as smart or as experienced as the head coach, but he does have a different perspective and he (rarely, if ever, a she) can see opportunities the head coach cannot see. That, briefly, made the case for why every leader should keep a journal.

The discipline of reflective journaling allows a leader to move high above the playing field to revisit key decisions or events, and think about how a decision was made and executed. To gain a sense of perspective of what was overlooked or misjudged when the actual decision was made. And to learn from the experience.

My journal entries today cover my Firm's efforts to reach next-level recruiting, on the critical decisions we make in our searches as well as ideas for future blogs. As the birthdays fly by, and I am required to make more notes on day-to-day operations, I keep a separate log to update my Outlook Tasks list and calendar.

Today I have graduated from the spiral notebook. I journal in the classic Moleskine and I have a really good pen.

John G. Self, Chairman and Founder of JohnMarch Partners, is the Firm’s senior client advisor. A 32-year veteran of the healthcare industry, he is a former investigative reporter and crime writer for a major daily newspaper. Candidates and clients say he is one of the most thorough executive recruiters working in the healthcare industry.

It Is Not Too Late To Say Thank You

WESTPORT, Connecticut (December 24, 2008) What Got You Here Won’t Get You There is Marshall Goldsmith’s amazing book on how successful people become more successful. It is a great read for executives who have been fired or for those who are successful in many ways but cannot move to the next level of performance.

I am in Westport for Christmas. It is near freezing. There is a mix of rain and snow falling on the 8 inches of snow that arrived last weekend. The weather aside, I am with family who love me unconditionally in a warm house filled with holiday cheer. This includes my wonderfully precocious three-year-old grandson, Jack. He is so smart, so quick and so I have to watch my old reporter’s language very carefully.

This loving warmth and good cheer has filled me with a great sense of confidence for the upcoming New Year. Yes, we face challenging times for the next four or five quarters, but America will recover if our new President acts wisely and the very large stimulus package that is being prepared to jump start the economy is used very wisely (read: sans Congressional Pork). We are still the most creative and capable nation in the world. To borrow from Tom Friedman’s excellent column in today’s New York Times, Time To Reboot America, we just need to reboot and remember those things that make us a great nation – education, creativity, innovation, and determination.

As I close this posting, I want to borrow from Dr. Goldsmith’s wisdom: As a leader you should recognize that success is not achieved because you have overcome great hurdles or triumphed over vexing handicaps, but because you have surrounded yourself with great people. “You have stacked the deck in your favor," Dr. Goldsmith writes.

As you spend time with friends and family this holiday season, reserve some quiet time for yourself to reflect on 2008 – the successes and the setbacks. Do not forget the contributions of your great people. Be thankful.

It is Christmas Eve, but it is not too late to say Thank You.

Merry Christmas. Happy Hanukkah.

John G. Self, Chairman and Founder of JohnMarch Partners, is the Firm’s senior client advisor. A 32-year veteran of the healthcare industry, he is a former investigative reporter and crime writer for a major daily newspaper. Candidates and clients say he is one of the most thorough executive recruiters working in the healthcare industry.

Small Firms Can Compete

JohnMarch Partners, a boutique healthcare search consultancy based in downtown Dallas, was awarded multiple search assignments by a UAE firm working under contract with the UAE government. We beat out several of the major firms for this assignment. Not only is the work very profitable, there is a good possibility that our academic practice will pick up related assignments.

How did we get the engagement? Believe it or not, it was not that hard. And the account acquisition costs were minimal.

Several years ago a candidate for a VP of HR position was impressed with our process. More importantly, he raved about the way he was treated, including when we told him he would not move to the next phase (read: a lot of communication from the recruiter). Although he was not really a good fit for that original assignment, he remembered our firm. When he became CEO of a joint venture company in the UAE, he reached out to JohnMarch. Now that he is back in the U.S., he is talking with us about a new overseas venture.

A lack of communication in the executive search process is a chief complaint of many candidates, according to our research. An oft repeated comment: "I never knew where I stood in the search and then weeks later I received a regrets letter." If I had a dollar for every time I heard that comment...

Entrepreneurs who work in the services segment frequently ignore lucrative business opportunities. We think that we are too small. We look at the overseas market as being too costly to penetrate. I know because I suffered from that disease for years.

Lesson learned? Do not short change yourself. Even small firms can get into the game, especially if they offer value that exceeds that which larger firms are willing to provide. The old-line firms are not that innovative or flexible. They have achieved critical mass through relationships but when it comes to innovation they can be like large battleships trying to turn in a small pond.

Flexibility and creativity are important strengths. For entrepreneurially-driven firms they reflect market power.

John G. Self, Chairman and Founder of JohnMarch Partners, is the Firm’s senior client advisor. A 32-year veteran of the healthcare industry, he is a former investigative reporter and crime writer for a major daily newspaper. Candidates and clients say he is one of the most thorough executive recruiters working in the healthcare industry.

Performance Assessment: A Strategic Imperative

DALLAS (December 16, 2008) – The well run healthcare organization is one that formalizes its annual talent assessment process, integrating this essential process with strategic planning and quarterly performance reviews while driving curriculum development for the internal management development institute.

Today, the performance review process at most healthcare organizations is the victim of siloed management culture with little or no talent assessment at the senior leadership level. A surprising number of hospitals, which are among the most complex of all businesses to operate, according to Peter Drucker, use the performance review process primarily as a driver for annual merit pay increases. While that is not a bad thing, if that is where this assesment begins and ends, those organizations are missing a huge strategic advantage. The management assessment must always remain focused on improved leadership performance which will translate into significantly enhanced performance.

Most NFL and college football teams do a better job of planning and evaluating their talent than the vast majority of healthcare organizations. This is particularly ironic since most NFL football players will never deliver a blood transfusion, administer chemotherapy, or fill a prescription for a critically ill patient in ICU, or run a busy hospital surgical service – anything that, if done badly, could harm or kill a patient.

The most successful healthcare organizations of the future will be those which develop and implement a more comprehensive performance evaluation process that is CHAMPIONED and LED by the Chief Executive Officer with the support of the senior human capital executive. Earlier I used the term annual talent assessment process. The truth is that evaluating talent is an ongoing process with quarterly discussions at the senior leadership level. Relegating this to a one-time annual experience is to waste opportunity.

Comprehensive talent assessments should be a strategic imperative. However, I do have one caveat: be leary of using national standards for the numbers of your employees in each employment category: As, Bs and Cs. There are a plethora of benchmarks for talent assessment programs – suggesting that in every organization known to man there will always be a certain percentage of poor performing employees. While there may be a correlation between the results of your rigorous internal performance evaluations and these national averages, relying on someone else’s statistical models to determine how many poor performing employees should be moved out of your organization is to invite criticism and undercut the integrity of this important program.

John G. Self, Chairman and Founder of JohnMarch Partners, is the Firm’s senior client advisor. A 32-year veteran of the healthcare industry, he is a former investigative reporter and crime writer for a major daily newspaper. Candidates and clients say he is one of the most thorough executive recruiters working in the healthcare industry.

Accountability for Executive Recruiters: A NEW PARADIGM

DALLAS, Texas [Dec. 8, 2008] -- As the economic carnage continues to unfold on Wall Street and other financial centers of the world, Main Street is beginning to brace for what could be tough times for the U.S. While healthcare typically is spared the full brunt of the misery, hospital CEOs have already started to look for ways to cut expenses and to wrench more value from the money they pay to vendors, particularly consultants.

These threatening economic times frame a more important question for healthcare, and the broader business community: How do we hold our consultants accountable for the quality of their work and the results they promised when they sold the deal? I am of the belief that the time is fast approaching for consultants, including executive recruiters, to step up and become true partners with their clients. Partnering should mean more than smooth business-speak language that is found in a brochure or glitzy advertisement. What we are and should be talking about is for consulting firms to share the economic risks with their clients.

What does this mean for executive recruiters who work on a retained basis? I have some ideas but I would like your feedback. When you finish this blog, click the comment button and share your thoughts.

Professional Fees

The major search firms now command 33 percent of the successful candidate’s first-year cash compensation. To calculate their fees, search consultants include the base salary, signing bonus, allowances for cars, club memberships, computers, cell phones, education and the performance bonus.

The bonus component of the professional fee is paid in one of two ways. The client and the search firm estimate what the successful candidate will earn in bonus at the end of the first bonus cycle and incorporate that amount in their final payment. The second alternative is for the search firm to wait for the actual bonus payment. In this scenario, called the true up, the search firm bases its final payment on the actual bonus earned by the candidate.

There are still numerous healthcare providers who happily pay the 33 percent professional fee. In their value system, there is a direct correlation between the fee and the quality of the search. They reason that firms who discount their professional fees cannot possibly offer the same type of quality of service.

Clients typically pay for this service in three payments: a retainer of 30 percent at the start of the search, one-half of the remaining estimated balance 30 days later and a final payment 30 days thereafter, regardless of whether the search is complete. However, there are numerous examples where search firms have been paid for work they never completed.

A New Standard

Client Satisfaction -- If the client is not satisfied with the quality of the panel developed by the search team, perhaps the firm should offer a fee discount for failing to meet their client’s expectation.

Performance Fee – Why should clients pay for work that has not been completed? Recruiters should tie their payment schedule to the progress of their work. In this formula, one that our Firm has used for years, the second installment is not due until a panel of recommended candidates is presented to the client. In this payment option, the final payment is typically due when the candidate accepts the employment offer.

At-Risk Fees -- Moreover, instead of using the age-old professional fee calculation, perhaps the search firm should be willing to delay the final payment until the end of the business cycle and put at risk the true up payment. If the candidate does not earn a bonus that is equal to the client organization’s historical average for performance, then the search firm would forego all or some of its final payment.

Contingency recruiters will argue that this is exactly what they do. However, they typically do not handle the top-tier assignments and spend little time with the client analyzing business operations and client culture.

Placement Guarantee

Currently, most of the major firms offer a 12-month placement guarantee. In reality, they would prefer not to offer any guarantee if they could get away with it. Occasionally, in a competitive shootout for an assignment, a Firm might offer a longer placement guarantee to distinguish themselves from the competitors. However, the current norm is 12 months.

A New Standard

The cost of a bad hire at the executive level ranks is significant, perhaps 50 to 100 times the candidate’s first-year cash compensation. If you doubt the damage a failed search can cause an organization just ask companies who were victimized by a candidate’s incompetence or search firm negligence. Mistakes are possible, regardless of how diligent all the parties are. In our Firm, we believe that the new standard should be 36 months for the C-suite engagements and 24 months for other executive assignments. The traditional search firm pushback to this idea has been that the search consultant cannot control what happens after the hire takes place. However, if the search firm has done a good job with their pre-search due diligence, if they are on the same page with the client in terms of the ideal candidate profile and performance deliverables, and if they have completed an in-depth candidate screening process and comprehensive background review, where is the risk? There will always be risk, but with a gold-plated search process, that risk is mitigated. You can always make exceptions for businesses that are in distress, or where there is abnormal executive turnover as the result of governance or other operational and financial issues.

Background Investigations

This issue should not even be on the table for debate. Search Firms who submit candidates without checking backgrounds for little anomalies like fraud, a dishonorable discharge, repeated DUIs, felony convictions, multiple bankruptcies etc., are practicing something akin to President Clinton’s infamous policy on gays in the military: Don’t ask, don’t tell. Regardless of how well known the candidate may be, there have been several glaring examples over the last five years where “known” candidates had some dirty little secrets in their background. It is amazing how overall reputation, a new book, and frequent appearances on the lecture circuit can push troubling background or performance issues into the background.

Why search firms do not routinely perform background checks on all their recommended candidates is beyond me. There is little risk for the Firm and a big downstream value for the client.

I realize for some that these ideas are heresy. I do not think they should be but now it is your turn.

John G. Self, Chairman and Founder of JohnMarch Partners, is the Firm’s senior client advisor. A 32-year veteran of the healthcare industry, he is a former investigative reporter and crime writer for a major daily newspaper. Candidates and clients say he is one of the most thorough executive recruiters working in the healthcare industry.