Reputation – it’s fundamental in society and affects our view of something or someone. It’s a ubiquitous tool that molds our perception of anything from organizations, products and brands to services and people. Collectively, these perceptions form a social evaluation that defines part of an identity.
What perceptions come to mind when you hear Internal Revenue Service, Ford Pinto, Rolls Royce, Magnet Recognition Program and Mother Teresa? “It takes many good deeds to build a good reputation, and only one bad one to lose it,” according to Benjamin Franklin.
Just how significant is an organization’s reputation in healthcare executive recruitment? Many studies and surveys through the years have offered insight into the value of prestige and its correlation to recruitment. In a recent study outlined by Harvard Business Review1 and published in Strategic Management Journal2, Wharton School of Business Assistant Professor Matthew Bidwell and his colleagues surveyed recent MBA grads on how reputation compared to more tangible lures in recruiting.
Results revealed that, at least in investment banking, business school grads who were at the top of their class preferred (over other attributes, including compensation) to work at firms with better reputations. This seems logical, as a good name helps catapult new, best-in-class grads into their careers, as long as they remain employed by their high-tier firms for at least five years. After this time, former new grads are ready for their next career move and feel the pressure from fresh, top-pick talent. This new class replenishes the “old,” and continues the cycle of premier graduates flocking to sought-after mammoths, according to the HBR outline.
Similarities exist between large, prestigious healthcare providers and companies like Goldman Sachs and the Blackstone Group. The brightest minds attend top medical schools and complete their residencies and fellowships with well-known providers. It isn’t always necessary for these providers to compensate their residents and fellows more, thanks in part to their reputation.
Fortunately for the majority of U.S. healthcare providers, which are smaller and perhaps less prestigious, seasoned executives are attracted to other competitive advantages. No two organizations are alike inasmuch as no two individuals, and this lends to the matchmaking challenge.
Years ago (in my hospital operations days), one could lead a successful hospital by focusing on maintaining assets and protecting the balance sheet. Business knowledge was important, of course, but high-end services were “franchised,” protected via Certificates of Need. As long as you managed decently and kept a healthy balance sheet, success was probable.
These days, providers are measured on quality and outcomes metrics. Reimbursement has shifted from being cost- and volume-based to now at-risk and value-based. Today’s healthcare environment has no room for executives who refuse to “share the wallet” with medical staff. Due to mergers and acquisitions, competition has broadened to include, for some service lines, statewide, regional or national territories. Population health has gained momentum, and more healthcare executives are interpreting public health information and production data within their purviews.
Considering that providers are in different stages of our healthcare industry evolution, attributes required of executive candidates vary. Some organizations need an executive with turnaround knowledge, while others may seek someone with a proven history of physician integration, while others need candidates with corporate backgrounds and merger experience. These differences make each organization uniquely attractive. The exciting part is matching the attributes of the executives and physician leaders, who find the current challenges irresistible, and are found to be a good cultural fit.
Within Tyler & Company, our healthcare executive and physician leader candidates find the most appealing providers are those tied to communities that resonate with them and their families (location, location, location applies here).
In addition, organizations can boost their appeal to CEO candidates by ensuring that conversations between candidates and the board focus on strategy and direction. Board stability is advantageous, as it can reflect a well-functioning, productive group.
We advise executives progressing in their careers to build their experience managing multiple service lines. Knowing the difficulty of “cutting your way to a positive bottom line,” candidates who present commendable business development experience, while rigorously controlling expenses, are favorably noted. To those executives and physician leaders who have worked in large physician practices, highlight the ways you’ve been entrepreneurial, yet kept a tight rein on expenses. Candidates with heavy financial experience (e.g., CFOs) striving to progress to CEO should seek ways to gain operational experience and knowledge.
Due to the trends in population health, we recommend that all candidates – healthcare executives and physician leaders – gain knowledge in analyzing and interpreting data related to a community needs assessment. Finally, candidates who illustrate a successful track record in reducing clinical variation are at an advantage.
The beauty of healthcare
Healthcare providers strive to retain their medical team and allied-health staff for their entire careers. By giving staff members a chance to make a difference and helping them feel valued, leaders provide an environment where work becomes important and rewarding. As that continues, the facility’s reputation will follow.
Dennis J. Kain, FACHE, President, has worked in the healthcare industry for more than 40 years. His foundation in hospital operations, which included serving as a hospital CEO, provides him with first-hand knowledge and understanding in finding executive talent. Reach Kain at 610-558-6100 or email@example.com.
1 Gavett, G. (2014), “The Real Reason New MBAs Want to Work for Goldman Sachs.” Harvard Business Review. https://blogs.hbr.org/2014/04/the-real-reason-new-mbas-want-to-work-for-goldman-sachs
2 Bidwell, M., Won, S., Barbulescu, R. and Mollick, E. (2014), “I used to work at Goldman Sachs! How firms benefit from organizational status in the market for human capital.” Journal of Strategic Management: doi: 10.1002/smj.2272