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A high performing Director of the Lab for a 565-bed hospital announced her resignation.  The Vice President responsible for overseeing the department consults with the Chief Operating Officer and Vice President of Human Resources and then contacts several contingency recruiters to identify potential candidates.

Five weeks later, a close friend of the now departed Lab Director – the Director of Pharmacy who was considered to be one of the best department managers in the organization – also resigns.

It would take six months before a suitable replacement for the Lab Director could be found.  It was another month before they reported for work after a costly relocation.  During
that time two section managers and the night supervisor also resigned.  What had been a star department failed to meet its contribution margin for the next five months as the new director made changes and recruited replacements.

The search for the new Director of Pharmacy lasted only four months.  The Assistant Director successfully ran the department during the transition but then resigned when she was not promoted.  The replacement Director resigned 14 months later for family reasons.  They were unable to sell their house and the hospital’s interim living arrangement expired and was not renewed based on a long-standing board policy.

Far too many health systems and hospitals are playing the talent management equivalent of Russian roulette in the event – unlikely or not – that a key Vice President, Director, or Manager will be recruited to a cross-town rival or across country for a sizeable increase in pay and scope of responsibility. 

Or worse, they left because they felt unappreciated and/or saw no opportunity
for future professional growth.  It is an interesting contradiction in priorities when an organization spends hours each month and each quarter reviewing financial, operational and clinical performance data but spends almost no time on management succession.

The case example clearly shows that this breakdown can lead to costly financial setbacks and a decline in morale, which frequently ignites greater turnover.  In the new healthcare economy, with lower rates of reimbursement from Medicare and commercial payers, CEOs can ill afford to take anything for granted, especially the organization’s human capital.  It is also noteworthy that both departing Directors reported to the same Vice President, a long-term executive with more than 28 years of leadership experience who was planning for retirement.

In a time when most organizations are focused on investing capital for data management, including the implementation and integration of Electronic Medical Records into existing
platforms, far too many are neglecting a less costly investment in human

With intensifying competition for the best talent, and with turnover rates beginning to rise in certain competitive markets – which will surely spread to other markets as the economic recovery takes hold – a more focused commitment on human capital will enhance an
organization’s performance and strengthen its net worth. 

An integrated Total Onboarding Program, with a best-in-industry recruiting process, and talent mapping are two of the best investments healthcare providers can make.