When Leadership Is Lonely and Uncomfortable

Carrie Vaughan, for HealthLeaders Media, October 3, 2008

The nation may be split on whether Congress should pass the $700 billion bailout plan for the financial industry. But one thing that people—both Republicans and Democrats—seemed to agree on this week was that legislators displayed a profound lack of leadership.

Legislators have been criticized by both advocates and opponents of the rescue plan as being more concerned about people's opinion and getting reelected than doing what is in the best financial interest of the nation.

The public view is that leaders need to be able to make tough decisions regardless of public sentiment—and healthcare is no exception. If the reimbursement climate and financial crisis is any indicator, hospital CEOs will be forced to make even more difficult choices in the years ahead—many of which will be unpopular with members of the community, employees, and clinicians.

Hospital leaders cannot be reactive, either, according to the hospital CEOs I have spoken with recently. They must be able to quickly assess the situation, make a decision, and follow through on the plan. Healthcare executives also need to be creative, because old solutions, operating models, and business practices will not solve new problems.

I heard a CEO at a conference recently say that being a leader can be "lonely and uncomfortable." For instance, no executive wants to lay off employees. But if headlines are any indication, we'll see many hospitals doing just that. Some of these layoffs are not the result of poor financial health of an organization, either. A healthcare system may simply want to restructure and centralize its organization as a way to improve efficiency. Still, layoffs will put people out of work and the remaining staff will be sad to see colleagues leave, and let's face it, maybe a little bitter about some of the cuts that were made.

Recently, I spoke with Jim Sanger, CEO for SSM Healthcare-St. Louis Network, about the organization's decision to cut roughly 120 positions. His advice is that organizations need to ask themselves, "If we make these changes, will we be a better organization when it is over." If the answer is yes, then it is the right decision. That doesn't lessen the turmoil or make the process any easier, Sanger adds.

Similarly, people don't want their hospital to abandon a service line. But hospitals can no longer be all things to all people. Healthcare executives will need to carefully evaluate what services their hospital can and should provide. For some hospitals that may mean cutting the OB/GYN department, long-term care unit, rehabilitation units, or community outreach programs.

When tasked with making these types of controversial decisions, hospital CEOs need to ensure that the choice is clearly explained to employees and community stakeholders. Explain why this plan is in the best interest of the organization. They may not agree, but communicating your message may be the best tool to keep the trust of your employees and community at large.

Carrie Vaughan is leadership editor with HealthLeaders magazine. She can be reached at cvaughan@healthleadersmedia.com.
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