Numerous forces — including regulatory requirements, changing policies and heightened standards for clinical quality and outcomes — are driving the evolution of the hospital business. As healthcare delivery becomes increasingly complex, the need to attract and retain the most qualified leaders has never been more pertinent.
However, research from B.E. Smith indicates this is easier said than done.
Here, Mike Supple, executive vice president at B.E. Smith, took the time to answer Becker's five questions on the biggest challenges when it comes to recruiting leaders, and exactly what it is top-tier talent is looking for in an employer.
Question: B.E. Smith's "Healthcare Trends 2017" report found executive candidates assess an organization's brand/culture and compensation package with great premium during their decision process. In fact, these two factors carried more weight to candidates than an organization's management and current employees. Can you expand on this finding? Are you seeing health systems approach talent recruitment with greater emphasis on brand and compensation?
Mike Supple: Organizational brand/culture and compensation have always been important factors for healthcare executives considering whether to stay with the current organization or explore new career opportunities. However, there are two important factors that are influencing how executives assess new career opportunities in 2017.
- First, 65.3 percent of healthcare executives are optimistic regarding healthcare's outlook this year.
- Second, 56.6 percent of executives are considering a career change this year.
We enter 2017 with healthcare executives feeling confident. This is coupled with an increasing demand for experienced leadership talent on the part of organizations. As a result, healthcare organizations are finding themselves in a very active workforce market. When asked specifically about recruitment challenges, 31.3 percent of healthcare executives said access to high quality talent was their primary challenge. However, 24.5 percent of executives acknowledged that organizational culture was also a challenge. Compensation and benefits ranked lower on the list because providers have already begun to adjust their recruitment processes. They have to stay competitive to recruit the level of talent they are seeking in the market. Many organizations are already tailoring their compensation packages to candidates based on their specific needs.
Q: That same report also shows more executives are looking to make a job change immediately or by 2018. Only 27 percent of respondents said they are not considering a change — that figure was 43 percent last year. This statistic really underscores the need for a retention strategy. What actions can hospital or health system boards and executive teams take to curb colleagues' propensity to leave the organization in 2017?
MS: While compensation is an important factor for healthcare leaders considering a career change, the motivation behind an executive leaving their current organization is highly complex. The survey found that several other factors significantly add to an executive's decision to leave. These factors include:
- Flexibility/work-life balance
- Management
- Career advancement/growth
- Colleagues
All of these factors directly impact an executive's satisfaction with their current organization, which is the strongest indicator if an executive will stay or leave an organization. The survey found that executives who are highly satisfied are also highly loyal to their organizations, even as other providers try to entice them away.
Additionally, career advancement and succession planning also has a significant impact on retention. In the survey, 41.7 percent of executives said they needed to leave the current organization to advance their career. Only 22.6 percent of executives said they were on an advancement track, and 24.5 percent said they were not seeking advance. It is not surprising that a large number of executives who said they needed to leave to advance were actively seeking a new career opportunity. What is surprising is that even executives who said they were not seeking to advance where at risk of leaving their organization. Three-quarters of these executives said they would consider a job opportunity if the right position or organization was presented to them. This should be a primary concern for healthcare organizations, particularly when 85 percent of healthcare leaders admit they've been approached with a credible job opportunity in the last 12 months.
Healthcare executives understand that succession planning and leadership development increases retention, with 54.8 percent of executives saying they plan to strengthen organizational leadership by developing future leaders internally this year. The survey did find an interesting disconnect between how executives want to strengthen leadership and what organizations are prepared to manage. Less than one-third of healthcare executives in the survey said their organization currently has a program in place. And almost half of those executives said the program was exclusive to senior executives. This presents a significant opportunity for most healthcare organizations to positively impact not only their leadership bench but also their recruitment and retention strategies.
Q: For what positions in healthcare are you seeing the greatest competition?
MS: Competition for senior executive positions, particularly physician executives, is extremely strong. We are seeing an increase in president/CEO of medical groups within integrated delivery networks. Our clients are looking for physician executives to fill these strategic and operational roles. There is significant interest among healthcare executives for CEO, COO, CFO, CNO, CMO and CHRO positions. While response rates are high, organizations are seeking executives with very specific skill sets that can add additional challenges and complexities to a search.
We are also seeing an increase in CIO leaders, both interim and permanent. With meaningful use beyond us, healthcare providers are optimizing clinical and financial systems using IT as a strategic tool.
Clinical leaders at the director level are also in high demand. These positions included directors of emergency departments, surgical services, case management, and women's services, to name a few. In some regards these positions may be more challenging as the position may not garner as much attention and requires a robust, national marketing approach to find the right executive to meet the organization’s needs.
Q: Passive job candidates don't think to make a change until the right opportunity presents itself. I'm curious to learn more about what, on average, makes that opportunity "right." What factors about a job offer tend to make the strongest impression on a candidate and behoove him or her to make a change, even one they were not actively pursuing?
MS: The motivations behind why an executive chooses to leave their current organization or decide to take a new opportunity are highly complex. As mentioned previously, the top reasons why these executives pursue these opportunities include:
- Flexibility/work-life balance
- Compensation/benefits
- Management
- Career advancement/growth
- Colleagues
When executives were asked to provide more detailed information behind their decision, several explanations surfaced.
- The location of the opportunity was most important, followed by the cultural fit.
- Executives are seeking more flexibility, whether internally with new management or externally with family.
- The job description. Executives are looking for an opportunity that offers interesting and challenging projects, or engaged colleagues.
- Executives listed compensation and benefits, specifically increased salary and potential for career advancement.
- Executives mentioned demands of the position including travel, long commutes, and clinical responsibilities.
Q: In addition to the positions facing the greatest competition, are there any regions or cities that stand out to you as homes to fierce job competition? Are there any types of organizations (academic medical centers, non-acute care settings, etc.) seeing an uptick in job competition?
MS: We are seeing increased job competition across the industry and facility types. In regards to specific regions, B.E. Smith partners with healthcare organizations in all 50 states. However, we are currently seeing a high level of competition in the geographic areas of the Southeast, Southwest, and Northwest and are experiencing an increase in recruitments in the states of Alaska, California, Colorado, New York and Texas.