Employee turnover is costly – especially when that employee is your senior medical practice group executive. There are the direct costs of recruiting someone new. There are also the fairly well-documented indirect costs including lost organizational history and experience, lost relationships, lost investment in training, and the lost productivity that accompanies organizational change. Even more significant is the strategic disruption that will occur if a new executive comes into the organization with his or her own strategy, based on past successes in other settings. So often, we have witnessed a change in strategic direction in a medical practice group with a perfectly sound strategy simply because “there’s a new sheriff in town.” There are times when infusing a medical practice with “new blood” and a fresh perspective can be valuable. Nevertheless, change for the sake of change can damage physician trust and engagement, dampen productivity, increase costs, and lead to further turnover.
Executive turnover is one of life’s realities – especially in an expanding economy, where competitive demand for effective executives is high. Medical practice groups can mitigate the direct and indirect costs of such turnover in the following ways:
- Effective Shared Governance: Developing and maintaining an effective governing body for a medical practice group brings tremendous stability to the organization even in the face of executive turnover. Physician and administrative members of the governing body should be carefully selected based on their ability to put the organization first. They should be actively engaged in reviewing clinical quality, service quality, productivity, and financial performance. The governing body should hold the medical practice group senior executive accountable for the successful implementation of approved strategies to improve performance in each area. In hospital-owned medical practice group settings, that governing body should include the hospital chief executive officer and the hospital chief financial officer to ensure that the body has the requisite authority and credibility to act rather than to be acted upon.
- Clear Strategy: A critical and time-consuming function of the medical practice group governing body is vetting and approving organizational strategies – some of which may take multiple years to fully implement – sometimes beyond the tenure of individual governing body members or operating executives. Developing clear strategies for improving clinical quality, service quality, productivity, and financial performance is essential. Developing and implementing a competitive strategy is equally essential for long-term viability. (Given regional competition affecting most markets, even sole community providers must be attentive to competitive strategy – or risk becoming victims of someone else’s strategy.) The organizational momentum created by a clear and compelling strategic direction is difficult to quantify, but clearly evident in well-run medical practice groups.
- Succession Planning: A well-developed team of effective implementers (practice managers) within the medical practice group is a sustainable competitive advantage that supports clinical quality, service quality, productivity, and financial viability. The governing body should ensure that the senior medical practice group executive hires and develops an effective implementation team for the practice group. Nothing is gained and much is lost by failing to invest in managers who can lead and guide implementation, rather than “caretakers” who simply warm chairs and often become barriers to performance. Offering competitive practice manager compensation is a start, but only a start. An experienced and continuously trained group of managers often yields one or more potential successors who can respond on an interim basis or a permanent basis to the inevitable turnover of a senior executive.
- Hire to Your Strategy: Selecting the right successor for a vacated senior management position is frequently based on a candidate’s individual qualifications, on relevant experience, and on potential organizational “fit.” Often lacking in the analysis is the candidate’s ability to implement and interest in implementing the organization’s established strategies. Too often, we see a highly qualified candidate disrupt the momentum of an entire organization in pursuit of his or her own agenda, rather than implementing the medical practice group agenda. The fix is simple. Develop a clear and compelling strategy and then hire to that strategy! We recommend asking the final few candidates to sign a non-disclosure agreement and then to respond to questions about how they will implement the medical practice group’s strategy, with the oversight of an engaged governing body.
- Interim Alternative: When faced with senior executive turnover, many medical practice groups do not have the luxury of a viable internal replacement candidate on an interim or permanent basis. Finding and recruiting the right external candidate, even with professional assistance, can take time – months in some cases – leaving the medical practice group without direction. In addition, some organizations find themselves without an effective governing body or lacking a clear and compelling strategy to drive clinical quality, service quality, productivity, and financial viability. As a result, they are recruiting blindly – with or without professional help. In such cases, investment in interim leadership is a smart move to prepare the medical practice group for its long-term investment in the right permanent executive.
The Halley Consulting Group is uniquely qualified to assist organizations on an interim basis to develop and implement an effective medical practice group governance model, simultaneously facilitating the development of a clear organizational strategy, while maintaining existing daily operations momentum. Our interim executives are supported by consultants with expertise in developing governance models for individual medical practices and for hospital-owned medical practice groups. We can then assist those governing bodies to develop and approve an action plan encapsulating the organization’s strategies for improving clinical quality, service quality, productivity, financial viability, and competitive advantage.
The Halley Consulting Group currently has a well-experienced interim medical practice group executive available for immediate placement. Our interim executive can help your medical practice group maintain operating momentum while you recruit a permanent executive with the skills to implement your group strategies.
Our experienced executives never remain available for long. For more information, call us today at 614-899-7325.