Faster than a speeding bullet, more powerful than a locomotive, able to leap tall buildings in a single bound: just some of the basic attributes it takes to be a CEO in today’s healthcare market.
Pick a country; any country. Then look at that country’s health system. Chances are you’ll find a system going through major change, or to use the mot du jour, transformation. And what’s driving this transformation? In almost every case it’s the tricky equation of how to deliver higher quality care to more people for less money. And fundamental to solving this equation is having the right leadership in place.
Outside of China, India and one or two other emerging markets, very few countries have the luxury of being able build a new health system from scratch. For the vast majority of us in Europe, North America and Australia, the challenge is to transform what we currently have into more effective and commercially viable provider frameworks. And to do so in a way that keeps the voters, unions, clinicians, financiers and a myriad of other bodies, happy. Healthcare is at the top of the political and public agenda and it seems to be the one area that can make or break a government. And we are all feeling the pressure to get it right.
So what implications does this have for the current and future leadership of the sector?
As executive search consultants we are in the privileged position of working with people who have done truly amazing things to transform health services. But even the most experienced of these individuals will admit that leading a healthcare organisation is a tougher gig now than even before. Satisfying the increasing demands of customers as well as meeting stringent regulatory requirements and delivering improved financial performance is already asking a lot. But then factor in a massively complex technology agenda, escalating health epidemics, ageing populations and economic downturn - future healthcare leaders need to be truly exceptional individuals with the strategic vision to think their way out of seemingly unsolvable problems. In short, we find ourselves searching for Superman and Wonder Woman.
But it’s not easy to find superheroes that can, or want to run healthcare organisations. And if we limit ourselves to candidates already in the healthcare sector, this will simply lead to a recycling of the best in the short term and in the longer term, a dearth of talented and hungry leaders rising through the system. So we have two options – looking outside of the healthcare sector; and looking in overseas healthcare systems. Both are exciting prospects for a global executive search business but neither is straight forward.
Searching out of sector – a great opportunity?
Looking outside healthcare can be a fruitful exercise. Plenty of other sectors offer expertise and leadership qualities relevant to running a healthcare provider, not least of all good management practices. Therefore it should be easy to put the chief executive of a transport company into running a hospital, right? Take rail travel; a 24/7 sector rife with complexity around safety, performance, cost improvement, customer satisfaction, regulation, politics etc…just like healthcare. So what is it that stops people making the transition?
When searching for CEOs we rarely encounter obstacles in attracting interest from senior leaders in other sectors. People are interested in healthcare. They care about their families and future generations. They see these roles as a chance to make a difference in a way that touches us all. Indeed, when we survey out-of-sector candidates who have made it as CEOs and directors in healthcare, we are always interested to discover just what the biggest surprises have been. The political complexity of the landscape is often one of the themes, particularly having to put so much time into so many different relationships just to maintain the status quo, let alone deliver contentious change. Fail to do this and you’ve lost before you've even started. Another theme is pace - or lack of pace, to be more accurate. This is not simply an issue of public versus private sector behaviours; this is about the multitude of factors that need to be considered before decisions can be taken. Because lives are at stake.
But interestingly, the most consistent feedback we receive is that people really feel the social value of what they are doing. They can see the profound dedication of the staff around them and can feel the whole NASA ethos that they are all putting ‘the man on the moon’. Many businesses would kill to be able to develop the strong, uncompromising loyalty and belief that most healthcare organisations enjoy.
So if it should work, why doesn’t it?
The difficulty for global search firms like Odgers Berndtson usually comes in convincing our clients that the less obvious candidates are sometimes the right candidates. That sometimes taking a risk isn't just the exciting thing to do, it’s the right thing to do, even though the learning curves for that individual will be many and steep.
And then there is the argument that “no other sector is as complex as healthcare”. Much like no other sector is as complex as retail, or travel, or government, or financial services. It is correct that some of the biggest barriers in moving from one sector to another lie in the cultural nuances of each. But it seems to be even more of an issue in healthcare. And it’s not difficult to understand why. There are real complexities in leading people who constantly make life and death decisions, who every day, deal with more emotionally challenging situations than most of us face in a lifetime. Most healthcare professionals would probably consider themselves to be driven by quite different forces to the rest of us and arguably this requires a more flexible and sophisticated leadership style than other sectors might demand. As a rule, doctors don’t like to think of themselves as being 'managed', at least not in the corporate sense that someone from a bank or a retailer would understand. Leading a clinical workforce requires different tools and a flexibility of approach that no other sector can replicate. People who spend their entire careers in healthcare will probably feel that, by their early forties they have just about understood how to pull it off and then they have another twenty years ahead to perfect it. Engage, enable, empower and support. Lead. This additional complexity is one of the many things that makes leadership in healthcare so exciting - far from being a hindrance, most CEOs new to the sector talk about how struck they are by the sheer brain-power that sits within one single organisation, and by the creativity, innovation and fresh thinking that often lies dormant, waiting to be awoken by the right leadership.
Another factor is the level of public interest; sure, we all get exercised about whether our trains run on time, or escalating energy prices, but try to close a local maternity ward or downgrade an emergency department and just see how many people hit the streets in protest. Nowadays, as a hospital CEO you can fully expect to find journalists waiting on your doorstep when things get difficult, and very worst case scenario, when lives have been lost 'on your watch'. Plenty of CEOs in the UK have unexpectedly found themselves making front page headlines at the centre of a snowballing media frenzy. This never used to be part of the job, but it is now and is the reason that media and resilience testing has become a routine part of our candidate selection process.
None of these factors make cross-sector appointments impossible, but they are certainly difficult. Experienced healthcare professionals already have a mountain to climb, but leaders from other sectors will more likely have to scale an entire range.
The next tier of leadership can be much more accessible. We search extensively across other sectors in a continual effort to grow the talent pool, and in more functional areas such as finance, HR and technology, there can be a definite preference for candidates with broader sector backgrounds. This is equally the case for the board. The majority of non-executives don’t bring previous healthcare experience, and are often sought out because they offer profound expertise in different sectors with a strong level of transferability. For a number of healthcare organisations, and particularly those operating in the public system, adding value through non-executive board members is a legitimate and much more straight-forward route.
If cross sector search isn’t the solution and if national systems aren’t producing the level of talent that we need for the future, we really only have one other option: fishing the global healthcare pool. Almost all of our searches in the UK require us to source leadership talent from overseas, not because there aren’t strong leaders in the UK but because the lack of movement and need for new insight is pushing us to focus elsewhere. Equally other countries offer different qualities in their leaders; for example, the prevalence of clinically qualified managers is greater outside of the UK and much of the research now suggests that hospitals with more clinically qualified managers perform better and deliver stronger patient outcomes. Another example is the level of competition in different health systems, the impact of which is often to drive up quality as well as improve financial competitiveness, with weaker providers losing out or possibly even closing – something that rarely happens in the UK.
Arguably, at a system level, cross border appointments should be quite straight-forward as the strategic challenges that we each face in our own system are broadly the same. Whilst the health systems of the UK, Australia and Canada have some fundamental differences, they also share a number of common factors: partial or total public funding, political profile, financial pressures, a need to grow access to care, technology-driven change. The list continues. And one only needs to count the number of senior healthcare leaders who have already moved from one system to another to fully appreciate the level of transferability, not to mention those who have flocked to the developing markets of the Middle East. On a number of levels, international experience seems to be viewed positively in the health sector and is an opportunity for leaders to develop and apply their skill-set within different, but equally challenging environments. Candidates who have spent some time overseas are also potentially more marketable to their own systems when they return as they offer the powerful combination of fresh perspective with relevant knowledge and understanding.
Let’s take a typical English CEO on an abridged world tour: starting in Canada, they’ll gain new experience in integrated care provision; in Sweden they’ll work in a system with very strong local accountability and a more evolved concept of provider choice; next we go to Australia, where CEOs operate within a sophisticated but effective mix of government-run and private insurance schemes with an increasing element of means-testing; and in Holland, he/she will be part of innovative health reforms that introduce competition in both funding and provision, thus driving a much stronger culture of end-to-end customer choice. Then, how about a spell in the Middle East, building a health system from scratch that has the chance to blend best practice from all over the world and develop the most innovative health services ever seen? And finally, the US: so different, so exciting and yet so inaccessible. The UK has recently made some high profile appointments from the US, all part of the master plan to transform the NHS. Whether or not this paves the way for significant transatlantic talent swapping, only time will tell but, thanks to the commercial imperatives now impacting on publicly funded systems and the reforms of the Affordable Care Act in the US, the divide in the health systems doesn’t feel quite so marked anymore.
It’s not only healthcare providers moving talent around the globe. Many of the major professional services firms have also made high-profile, international appointments in an effort to apply new thinking and perspective to overseas healthcare markets. The reason a number of these businesses are so successful is that they field teams of experts who are not rooted in one healthcare system – they have enough knowledge to understand the task but a big enough knowledge gap to ask the clever questions. There is a natural inquisitiveness. People who regularly ask themselves: Where are they doing this differently? Where are they doing this better?
There are clearly no easy solutions to the burgeoning talent crisis. The unavoidable truth is that the healthcare sector is getting tougher, leadership roles are getting bigger and the talent pool is shrinking. But as search professionals, we must listen to what the global market is telling us:
- Be creative in the search: we need to keep exploring new, untapped areas if we are going to identify the talent to take on tomorrow’s leadership roles. And we need to do whatever it takes to nurture this interest and support people in making the transition.
- Push the existing talent further: let’s take our best leaders out of their comfort zones, expose them to new areas and force them to think differently. This is ultimately about turning strong leaders into exceptional ones.
- Embrace the challenge: in such a rapidly changing landscape, now is the time to open the door to a new generation of leaders. They might be from healthcare, from other countries, or even from other sectors. But rest assured the leaders of tomorrow will look very different to those we have today.
It is difficult to imagine what the global healthcare landscape will look like in the future, but one thing is certain: the search for Superman continues.