Over the past 10 to 15 years, healthcare management teams have been repeating the same costly mistakes, often leading to failure and unsustainability of organizations. A recent article by Scott Becker and Emily Rappleye discusses the main mistakes they believe are causing health systems to falter. The following errors are ones you want to make sure your organization is avoiding:
1. Failing to build the next generation of management.
In most healthcare organizations, a core team makes up the foundation of leadership, and when organizations don’t prepare future generations to step up, they can face problems revitalizing and taking on new challenges. In 2013, 76% of CEOs were promoted within, and per Forbes, CEOs promoted from within tend to perform better and stay longer than those hired from outside the organization. CEOs also need to be able to work in both the present, and the future. If a CEO is not able to do this, many organizations will seek out strategic partners. Stephen Clasko, MD, MBA, President and CEO of Thomas Jefferson University and Jefferson Health System advises, “You should always have five people under you who think they can do a better job than you, and three of them that are right.”
2. Changing collections and health IT systems without adequate forethought.
Per Michael Blackman, MD, CMO of McKesson Enterprise Information Solutions, hospitals replace their health IT systems about every 17 years. Instead of treating this change like buying a new phone, hospitals need to think of it more like buying a house. They must anticipate changes and growth over the next couple of decades before deciding on which system is best for their organization.
3. Preventing great leaders from thriving internally.
Per a Society for Human Resource Management survey, “opportunities to use skills and abilities” was ranked as the most important factor in job satisfaction by employees. Most systems try their best to keep CEOs happy, only to see them leave for another opportunity. To keep leaders feeling like they are being given the opportunity to use and develop their skills, work closely with them to ensure they always feel challenged, yet not overwhelmed.
4. Allowing one great facility to become two mediocre facilities.
Expansion is not successful for all health systems. Instead of becoming more robust after expanding, many systems get weaker and more vulnerable to unexpected challenges. Expansion leads to an increase in debt and expenses, and hospitals must consider this before deciding to expand. Can the depth of your market support the additional expenses an expansion brings? Do you have the demand to make an expansion profitable? Examine revenue projections to help answer these questions.
5. Failing to develop a brand.
National Research Corp reported one third of healthcare consumers said they would consider using their most familiar national brand for treatment or surgery. Developing a brand or specialty is important to the success of any health system. The article gives the following example:
“In a high-paying urban setting, we have seen certain systems fail to develop any specialty or strength to establish the system as a top hospital choice. In contrast, systems that were once rated as fine, or as better than mediocre, become incredibly serious systems by developing a great managed care or physician affiliation system.”
Have you seen your organization make these mistakes in the past? Work together with top management to develop a plan to avoid these preventable slipups.