As the traditional hospital business structure evolves, the next generation of healthcare leaders will need a notably different set of core competencies and management skills to achieve organizational success in a value-based industry.
Era of unprecedented change
"Recent political changes will not modify the fundamental shift toward improved quality and value in our hospitals and healthcare systems," Jim Rice, PhD, Managing Director and Senior Advisor with Integrated Healthcare Strategies, a division of Gallagher Benefit Services, Inc., said during a webinar Nov. 17.
Increasing complexity in payment models, regulatory requirements and care delivery has driven many hospitals to the market in search of business partners or sophisticated change-management tools. But an organization's overall leadership strength will trump technical competencies when it comes to leading an organization successfully through change and into value-based care delivery, Dr. Rice said.
This makes identifying, developing and recruiting leaders with particular strengths imperative for hospital systems moving forward.
Five strategic imperatives
Hospitals and health systems face the following five leadership challenges as they begin to transition to population-based healthcare.
- Develop teams to manage risks, costs and data for health gain, not just healthcare.
- Build systems to manage consumer relationships over a greater period of time.
- Use protocols that change consumer lifestyle behavior.
- Nurture complex community health partnerships to influence social determinants of health.
- Establish payer contracting incentives and monitoring.
"Healthcare organizations are increasingly realizing they lack the capabilities necessary to effectively respond to all of these imperatives," said David Bjork, PhD, Managing Director and Senior Advisor at Integrated Healthcare Strategies. For instance, hospital leaders accustomed to a "hands-off" management approach may not be able to effectively build and nurture productive relationships with external care partners, or lead collaborative community-outreach efforts.
This suggests employees with a different set of leadership abilities are needed to helm initiatives aimed at developing new organizational competencies.
Four core competencies of the next-generation CEO
Dr. Bjork suggested the next generation of healthcare leaders need competencies in the following areas to effectively respond to industry change.
I. Inspirational and persuasive leadership. Because people are generally creatures of habit, many require a significant level of motivation to accept new behaviors. Hospitals need leaders with a strong vision for the future and who can inspire others to change.
II. People-skills extraordinaire. "Culture in healthcare settings tends to be risk-averse," Dr. Bjork said. In an outcomes-based industry, "there's an enormous requirement for change from how healthcare professionals were expected to perform in the past." Leaders with incredibly adept social skills have the best chance to reshape cultural values in the work environment to better align with changing requirements.
III. Focus on execution and results. The next-generation healthcare leader is tasked with building entirely new operating structures to facilitate healthcare processes. An entrepreneurial-minded leader who can take advantage of opportunities as they arise can help keep the healthcare organization moving forward during times of uncertainty.
IV. Personal character. Many of the traditional characteristics of a quality leader will remain the same, like integrity, accountability and confidence. But Dr. Bjork emphasized the traits of curiosity and courage in coming healthcare leadership. As delivery models transform, hospitals will benefit from leaders who have the courage to take risks and seek out innovation.
Recruit and develop the right leaders
There are very few people who already have experience doing the jobs necessary to run a healthcare organization in a value-based industry. Many healthcare providers are inventing jobs "on the fly" to meet requirements and manage responsibilities in the transition away from fee-for-service payment. Often time these roles lack a standard job description, said Kathy Hall, Managing Director and Senior Advisor at Gallagher MSA Search. Examples of new titles include: chief population health officer, chief clinical care transformation officer, chief experience officer and chief nurse informatics officer.
Ms. Hall recommended hospitals incorporate the following strategies to recruit and develop future healthcare leaders.
I. Identify internal talent. "Look internally first," Ms. Hall suggested. "With the level of change we are experiencing as an industry, we know strong past relationships and trust are two of the key behaviors we need in future leadership." This could mean establishing a dyad between a physician and an administrator who clearly present themselves as champions of change.
II. Court external talent with care. Ms. Hall said hospitals should recognize the risk of bringing in an outside agent to helm change in an organization. Long-lasting change requires collaboration, trust and unity among employees. External change agents may face difficulty inspiring staff to abandon tradition and change workplace culture. If a hospital does choose to bring in outside expertise, Ms. Hall suggested partnering that person with an internal candidate in a leadership dyad to smooth the transition.
III. Develop internal candidates. Ms. Hall recommended a variety of ways hospitals can groom employees for future leadership positions. These include hiring outside consultants to teach young leaders risk-management skills, sending young leaders to academic programs in population health management and investing in physicians and nurses to help them learn managed care best practices.
To watch a recording of the webinar, click here.
To download a copy of the webinar presentation, click here.