Leadership has never been an easy career pursuit but with today’s dynamic economy the challenges of being an effective leader are particularly acute, especially in those industries that are experiencing dramatic transformation with their business models. Healthcare, the news business, publishing and retail, for example, are all facing daunting challenges. Did you know that the US has lost more jobs in the retail industry than the whole of the coal industry? In the news business, where digital platforms have disrupted traditional advertising revenue and content distribution models, thousands of journalists have been laid off and hundreds of newspapers, including my former employer, The Houston Post, were driven from the market. In radio broadcasting, once a focal point for creating communities of similar interests, there are fewer live announcers, especially in smaller communities. Local disc jockeys and announcers are being replaced with programming computers that provide music, public affairs shows and weather information at lower costs than the old radio production model.
Every day, the Amazon delivery teams bring in dozens of packages to my building in Dallas. Several times a day they deliver everything from books and small appliances, to laundry detergent and paper towels and even items for the food pantry, all merchandise we once only bought at a retail store.
In healthcare, as reform realigns economic incentives, patients are being moved away from traditional acute care facilities — the big box hospitals — to more appropriate, less costly settings for diagnostic evaluation or even definitive care. This shift in care management will only escalate as controlling this nation’s enormous spend on healthcare services becomes an economic necessity.
These pressures on rural and community hospitals which are an essential part of the nation’s healthcare delivery structure, can be more intense, necessitating an acceleration in the pace of change to ensure survival.
Not only are these changes impacting the healthcare business model, but they also pose threats to those executives who are not sensitive to how these changes will impact their leadership style. Some executives talk about change but continue to operate as if change has no bearing on how they lead and communicate with their teams.
The truth is that executives rarely think about how they communicate. It is an automatic, something they do instinctively based on years of experience. In my years of interviewing executives, it is rare to find someone who has taken the time to create a communication structure and a plan.
While this may seem counterintuitive, leaders in smaller organizations like rural and community hospitals must be more adept than their colleagues who toil in larger corporate structures in metropolitan areas. They have to do so much more with less, and, typically, they have to do it faster.
One of the core competencies of leadership is communication; senior leaders must be excellent communicators.
Communication is about sharing information but it is also about seeking clarification when there are questions that are unanswered or when the situation is unclear.
Today I want to share my four pillars of effective leadership communication:
First, be strategic. You must always be thinking ahead. Leaders and managers cannot afford to take anything for granted. You cannot delay because the pace of change can, and probably will, overwhelm your ability to respond, especially if you have a habit of kicking the can down the road for a more convenient time to share information. To be an effective strategic communicator you must anticipate and understand how events will affect your team and those with whom you must collaborate. If this is not a natural ability you must plan in advance.
Second, you must maintain ongoing communications. In a fast-moving environment there is always the risk of management assumption — one or more of the parties in the project chain assume certain facts or make the wrong calculations based on inaccurate or poorly communicated information. Regularly scheduled communication updates with your superior and direct reports are critical, especially in times of intense activity — the roll out of a new service line, the change in a major vendor, or changes that produce a significant increase in activity.
Third, follow-up is essential. In mission critical scenarios, confirming the details of a meeting and the decisions made, especially highlighting action items that must be addressed, can sometimes make the difference between success or a mess. Even if it is a quick email, this can ensure that faulty assumptions are avoided and that action items are addressed in a timely manner.
And finally, be structured. Create a communications process and style that is consistent with a highly reliable leadership model. Your superior, your peers and direct reports will value that consistency. Always have an agenda with the goal of advancing the ball. Everyone hates meetings to discuss what happened in the last meeting. Afterwards, distribute the minutes of the meeting with action items and accountability specifically spelled out. In the end, effectively communicating information with clearly performance expectations is a bedrock of success.
One of the most important jobs of a governing board — whether it is a large corporation in a major metropolitan area or a small rural community hospital — is selecting a Chief Executive Officer. While finding the right fit for a CEO to lead a complex, multi-site enterprise is no small order, I believe the challenges facing board members overseeing a rural community hospital are much more daunting.
Big corporations compensate their members for their time. They are supported with staff resources to help them discharge their duties. Governing boards in smaller enterprises do not have that luxury. Most volunteer their time. They have full-time jobs and there are limited support resources available to guide them through the process.
There is a significant risk in hiring a new leader. If you are a board member looking at statistical success rates across all industrial sectors, at large and small companies, there is a stunning number that has remained about the same for the past 2o years: 40 percent of new executive hires usually leave within 18 months. The cost associated with that level of leadership turnover is staggering. Most studies conclude that the cost for a miss-hire or an early resignation, ranges between 100 and 200 times the executive’s annual salary. For a small business that is a terrible financial hit. In my 20 years of leading executive searches I have seen once successful community hospitals closing because of one poor hiring choice combined with an astounding reluctance by the board to admit they made an error, all evidence to the contrary.
So here are three concepts board members should consider when faced with making their most important decision:
References. There must a minimum of four — one or two former superior (bosses), a peer, and a subordinate. These individuals must be able to speak to the candidates’ performance at previous employers. Be sure to ask questions about the performance claims made by each candidate. Today, fabricating academic and professional credentials is a rarity. Exaggerating successes is much more common. In other words, follow President Ronald Reagan’s advice: trust but verify.
When deciding which firm to hire, ask about their process including how much time the recruiting who will be leading the search will spend on site, getting to know the board, the staff and community stakeholders. That is a function that cannot be done on the telephone or videoconference call. If the recruiter is reluctant to invest the time, they will not be able to understand your organization’s culture and that could very well lead to a very expensive miss-hire.
If you are a board member and would like additional information on the CEO search process, email me at email@example.com.
That’s it for this week. Next week we will look the important role a comprehensive onboarding program plays in reducing costly turnover.
© 2018 John Gregory Self