The transition period between CEOs is a confusing time for a hospital, so it makes sense that hospital boards should take their time deciding when to hire and fire top executives. Kevin Troutman, chairman of the healthcare practice for Fisher and Phillips and a former healthcare executive himself, shares two ways to know when it's time to sever ties with your CEO.
1. Your CEO doesn't have a plan for dealing with external forces. In a tough economy, the job of a CEO becomes more difficult. There are certain factors — the bad market and regulatory issues, for example — that will take a negative toll on your hospital no matter what your CEO does. "One question to ask yourself is: Does the current CEO understand why we're having this problem? Does the CEO have a plan to address the problem?" Mr. Troutman says. "If [he or she has a plan and the hospital is still suffering], it may just be that external forces are just so much that the greatest CEO couldn't perform any better." In order to tell if the problem is with the healthcare industry or your specific executive, take a hard look at your CEO's plan of attack and compare your hospital's situation to similar facilities. "If the CEO seems bewildered about how to deal with those issues, it may be time to make a leadership change," Mr. Troutman says.
Mr. Troutman says a leadership change may be in order if the circumstances have been so difficult that your organization needs a fresh perspective. "That may not be the fault of the CEO," Mr. Troutman says. "Sometimes you just need a change, and typically that situation will develop over a longer period of time, whereas real competency or incompatibility problems will become clear pretty quickly."
2. Your CEO has a bad relationship with the medical staff. "The thing that makes the CEO position unique is their interaction with the medical staff," says Mr. Troutman. "The medical staff has to see and feel they have input on the CEO's [status] at the hospital." Because your hospital board probably includes both medical staff and laypeople, you should be able to get a sense of physician opinion on your CEO. "Your board members will know each other well enough to know if a certain physician is just never satisfied," says Mr. Troutman. "If this is a doctor who finds something wrong with everything, you're not going to get too alarmed if you hear complaints. But if it's someone who thinks things through, and they really have a serious issue with the CEO, you want to listen to it."
Mr. Troutman says physicians can be a great resource on how the CEO's decisions affect day-to-day life in the hospital — a perspective that higher-level administrators might not bring to the table. Physician satisfaction isn't everything, but a CEO who has a strong relationship with the medical staff can get through hospital financial difficulties much more easily than one who can't see eye to eye with your physicians.
1. Your CEO doesn't have a plan for dealing with external forces. In a tough economy, the job of a CEO becomes more difficult. There are certain factors — the bad market and regulatory issues, for example — that will take a negative toll on your hospital no matter what your CEO does. "One question to ask yourself is: Does the current CEO understand why we're having this problem? Does the CEO have a plan to address the problem?" Mr. Troutman says. "If [he or she has a plan and the hospital is still suffering], it may just be that external forces are just so much that the greatest CEO couldn't perform any better." In order to tell if the problem is with the healthcare industry or your specific executive, take a hard look at your CEO's plan of attack and compare your hospital's situation to similar facilities. "If the CEO seems bewildered about how to deal with those issues, it may be time to make a leadership change," Mr. Troutman says.
Mr. Troutman says a leadership change may be in order if the circumstances have been so difficult that your organization needs a fresh perspective. "That may not be the fault of the CEO," Mr. Troutman says. "Sometimes you just need a change, and typically that situation will develop over a longer period of time, whereas real competency or incompatibility problems will become clear pretty quickly."
2. Your CEO has a bad relationship with the medical staff. "The thing that makes the CEO position unique is their interaction with the medical staff," says Mr. Troutman. "The medical staff has to see and feel they have input on the CEO's [status] at the hospital." Because your hospital board probably includes both medical staff and laypeople, you should be able to get a sense of physician opinion on your CEO. "Your board members will know each other well enough to know if a certain physician is just never satisfied," says Mr. Troutman. "If this is a doctor who finds something wrong with everything, you're not going to get too alarmed if you hear complaints. But if it's someone who thinks things through, and they really have a serious issue with the CEO, you want to listen to it."
Mr. Troutman says physicians can be a great resource on how the CEO's decisions affect day-to-day life in the hospital — a perspective that higher-level administrators might not bring to the table. Physician satisfaction isn't everything, but a CEO who has a strong relationship with the medical staff can get through hospital financial difficulties much more easily than one who can't see eye to eye with your physicians.