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3 Hidden Benefits of Succession Planning

 |  By Lena J. Weiner  
   August 10, 2015

Building a solid leadership pipeline holds benefits for hospitals beyond the obvious ones, experts say.

Engaged employees, strong HCAHPS scores, and a gaggle of young, eager recruits are things hospital leaders dream about. Few might make the connection that the way to achieve these things is strong succession planning and ongoing training, but one B-school professor believes a strong leadership pipeline program is the key.

The benefits of a well-developed leadership program don't stop at having several candidates for top positions, says Kevin Groves, PhD, associate professor of organizational theory and management at Pepperdine University Graziadio School of Business and Management. He is also a management consultant to several health systems, who has also written about the benefits of talent management for hospital outcomes.

How Succession Planning Boosts Employee Retention Rates

Groves's research found that hospitals that have adopted talent management and succession planning best practices are associated with high scores on the Centers for Medicare & Medicaid Value-Based Purchasing metrics, which are tied to reimbursement rates for Medicare and Medicaid programs.

Kevin Groves, PhD

"We're in this situation where hospitals are transitioning from volume-based reimbursement… to value-based reimbursement. The Affordable Care Act and other legislative efforts have created an entirely new business model for hospitals," he says.

Poor succession planning can lead to decreased quality of care, which can stifle reimbursement, Groves contends. "Our revenue streams are suddenly much more dependent on the quality of our services," he says, and that time to regroup after a leader's departure is now a thing of the past—organizations need to have a plan ready.

Here are a few things that can happen when proper succession plans are in place:

1. Improved Employee Engagement
"Hospitals that want high levels of employee engagement should know that the best way to move to peak engagement is through proper succession planning," says Groves.

When employees feel valued and like their organization is dedicated to helping them develop their skills and creating a strong career path for them, they're much more likely to be engaged at work says Groves.


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Lena J. Weiner is an associate editor at HealthLeaders Media.

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