A high performing Director of the
Lab for a 565-bed hospital announced her resignation. The Vice President responsible for overseeing
the department consults with the Chief Operating Officer and Vice President of
Human Resources and then contacts several contingency recruiters to identify
potential candidates.
Five weeks later, a close friend of
the now departed Lab Director – the Director of Pharmacy who was considered to
be one of the best department managers in the organization – also resigns.
It would take six months before a
suitable replacement for the Lab Director could be found. It was another month before they reported for
work after a costly relocation. During
that time two section managers and the night supervisor also resigned. What had been a star department failed to
meet its contribution margin for the next five months as the new director made
changes and recruited replacements.
The search for the new Director
of Pharmacy lasted only four months. The
Assistant Director successfully ran the department during the transition but
then resigned when she was not promoted.
The replacement Director resigned 14 months later for family
reasons. They were unable to sell their
house and the hospital’s interim living arrangement expired and was not renewed
based on a long-standing board policy.
Far too many health systems and
hospitals are playing the talent management equivalent of Russian roulette in
the event – unlikely or not – that a key Vice President, Director, or Manager
will be recruited to a cross-town rival or across country for a sizeable
increase in pay and scope of responsibility.
Or worse, they left because they felt unappreciated and/or saw no opportunity
for future professional growth. It is an
interesting contradiction in priorities when an organization spends hours each
month and each quarter reviewing financial, operational and clinical
performance data but spends almost no time on management succession.
The case example clearly shows
that this breakdown can lead to costly financial setbacks and a decline in
morale, which frequently ignites greater turnover. In the new healthcare economy, with lower
rates of reimbursement from Medicare and commercial payers, CEOs can ill afford
to take anything for granted, especially the organization’s human capital. It is also noteworthy that both departing
Directors reported to the same Vice President, a long-term executive with more
than 28 years of leadership experience who was planning for retirement.
In a time when most organizations
are focused on investing capital for data management, including the
implementation and integration of Electronic Medical Records into existing
platforms, far too many are neglecting a less costly investment in human
capital.
With intensifying competition for the best
talent, and with turnover rates beginning to rise in certain competitive
markets – which will surely spread to other markets as the economic recovery
takes hold – a more focused commitment on human capital will enhance an
organization’s performance and strengthen its net worth.
An integrated Total Onboarding Program, with a best-in-industry recruiting process, and talent mapping are two of the best investments healthcare providers can make.
John G.
Self is Chairman and Senior
Client Advisor of JohnMarch
Partners. He is a Co-Founder of the
Firm. A former investigative reporter and crime writer with more than 30-years
of healthcare leadership experience in public relations, national marketing,
business development and as Chief Executive Officer of hospitals and consulting
firms, Mr. Self is highly regarded for his keen insight into operations,
business culture and for his ability to consistently select the right leaders.
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