5 tips for transformational leadership from Scripps Health
The Governance Institute, a service by National Research Corporation, has released a case study on the organizational transformation of San Diego-based Scripps Health Service and the success of its president and CEO of 14 years Chris Van Gorder.
Since his appointment in 2000, Mr. Van Gorder and Scripps have experienced $240 million in cost savings and an increase in its annual profits by over 1,200 percent.
In 2000, Scripps Health Service faced financial ruin. With weak leadership, low employee trust and a 17 to 20 percent turnover rate, Scripps Health had an operating loss of $20 million. The CEO at the time was relatively new to the position and he resigned mid-year 1999 after the medical staff gave him a vote of no confidence.
At that time, Chris Van Gorder had just begun his job as COO at Scripps and quickly accepted the job as interim CEO after the previous CEO's resignation. Fourteen years later, the health system is recognizably different.
Here are five ways Mr. Van Gorder turned around the health system. Through strong leadership from the top-down, the organization achieved transformation, greatly improving finances and employee satisfaction along the way.
1. Start small. In the beginning of his term as interim CEO, Mr. Van Gorder kept his strategy simple. His main concern was increasing medical staff confidence in the leadership of the health system. He first threw out the system's current strategy titled "Project Scripps," which had not been endorsed by any of the medical staff and replaced it with a one-year tactical operating plan. He then developed the Physician Leadership Cabinet, which ultimately became a tool to engage independent medical staff.
2. Engage all aspects of the medical staff in the process of change. Mr. Van Gorder provided transparent information so that all staff involved and affected by resulting decisions was aware and informed of the current circumstances and changes being made.
3. Engage other stakeholders. Mr. Van Gorder also was sure to engage key stakeholders to ensure that key decisions were not made by one person or just the senior leadership. The stakeholders not only helped make the decisions but also helped implement the changes necessary to accomplish the new goals for the system as well.
4. Value leadership education. Leaders across the system learned implementation tactics from Mr. Van Gorder and used those tactics in current and future changes across the system.
5. Achieve mutual trust and respect among staff and executives alike. Mr. Van Gorder stressed the value of human capital and created a transparent environment based on confidence in the leadership to ensure a successful future.