Succession Planning: 7 Tips for Health Execs

Publication
Article
MHE PublicationManaged Healthcare Executive March 2019 Issue
Volume 29
Issue 3

Succession planning

Leadership succession planning is an essential part of healthcare talent management. It provides an opportunity to capture “tribal knowledge,” according to experts.

“Healthcare in particular is an extremely dynamic space,” says Cheryl Nagowski, senior director, federal markets, D2 Consulting, a life sciences consulting firm in Chesterfield, Missouri, offering both strategic and tactical commercialization services to pharmaceutical, biotechnology, and medical device manufacturers. “Understanding internal and external events that have affected the current position of the business unit, as well as any undocumented risks and best practices, is key to maintaining operating effectiveness after a critical role departs the organization.” 

Logically, most would agree that healthcare executive roles (especially C-suite roles) are critically important to an organization’s ability to thrive in meeting mission, vision, and fiscal year goals in a sustainable and ongoing manner, according to Chuck Taylorprincipal, Human Capital Solution Group Leader, GE Healthcare Partners, a in Chicago-based provider of outcomes-based solutions in healthcare via performance partnerships, command center partnerships, and consulting solutions.

Related article: Six Skills You Need to Have

“Succession planning is important because the process, supporting meetings, and output create a common book of truth and understanding-typically owned by the CEO and facilitated by the chief human resources officer [CHRO]-that captures details and nuances about critical executive roles,” Taylor says. “These details and nuances typically include information on both incumbent and succession candidates/options.”

For the incumbent, information captured could include:

  • time in role;

  • projected or desired tenure;

  • risk-retention information;

  • performance profile; and

  • associated talent action plan (i.e., current actions to ensure retention, leverage strengths, improve gaps).

According to Taylor, for succession candidate options there’s often a short menu of options:

  • internal, ready to move into role now;

  • internal, ready to move into role one to two years;

  • internal, potential for role >3 years; and

  • external candidate

“For internal candidates, succession planning also provides a strong linkage to individual career planning needs,” Taylor says. “Having a clear picture of incumbent and succession candidate options allows for the CEO and HR and broader leadership team to operate in an agile manner. So, if a leader departs in a voluntary or involuntary way, the CEO and/or HR is able to quickly detail succession candidate options and move forward.”

Nagowski agrees that succession planning is important because it contributes to staff development. “It is an opportunity to create a defined career path for a successor, increasing loyalty and helping staff feel seen and valued by the organization,” she says. “It is also important to ensure a portion of the business doesn’t come to a standstill when a person in a key position departs the organization. These activities are sometimes uncomfortable because they force us to accept 1) that people will likely one day leave the organization and 2) that we ourselves can be replaced as leaders. However, setting a tone and culture that embraces change and personal/professional development and advancement will ultimately improve staff loyalty and retention.” 

Here are seven tips for effective succession planning:

1. Identify the right candidates. “Ensure they are not just capable but that they also understand the full scope of responsibilities,” says Nagowski. “Never assume a direct leadership chain progression is what a staff member is interested in pursuing long term.”

2. Start early. Introduce the path to fulfill your role early so that the identified candidate clearly understands how to get there, according to Nagowski.

3. Take a holistic approach. The strength of any component of performance management is often tied to the strengthen of other components in the model or system, according to Taylor. “For example, shifting an organization from annual performance reviews to ongoing performance development places a need for a strong expectation setting, as well as a need for learning and development to ramp up training around coaching and mentoring.

“Likewise, succession planning by itself is a value add, but to be truly effective must be supported with strong recruiting and onboarding, rewards and recognition, performance appraisals, and learning and development,” Taylor says.

4. Provide opportunities for exposure outside of their current role.Not only is it important for a potential successor to prepare by understanding critical elements outside of their current job duties, it is also important that others in the organization start to gain trust in this individual’s capabilities by seeing them exposed to other business units,” Nagowski says.

5. Promote appropriate transparency. “Often succession planning is tightly controlled by CEO and/or HR with only one-on-one discussions,” says Taylor. “GE’s promotes higher levels of appropriate transparency. In our talent system process, the entire C-suite would transparently listen, comment, and dialogue during the CFO’s talent review presentation on finance, or the CNO’s review of nursing. As such, the entire leadership team would understand succession planning in the fuller context of the entire finance and nursing organization. The fostering of appropriate transparency-right leaders reviewing the right organization/ individuals-engages a broader set of leaders in helping to develop or recruit talent. Transparency also allows for cross-flow of talent-avoiding having individuals being siloed."

Related article: New Chiefs at MCOs: 4 Positions You May Want to Add

6. Be fair, provide opportunity to all. “Ensure that all staff are provided an opportunity to develop and succeed,” Nagowski says. “It doesn’t matter if that advancement is within their current company, or elsewhere. Managers have an inherent responsibility to develop their people, and should consider this a privilege.”

Michele Markey, vice president of training operations for SkillPath, agrees. “Identify top talent at different levels-company contributors, middle management, and leaders-and assess these team members for key competencies, like team building, and communication,” Markey says. “Once talent has been identified, drive their growth through experiences. This may mean creating new executive positions, roles, or assignments that expose them to different projects; assigning the upcoming leader to a second-in-command position; or allowing them to fill in for senior leaders for some length of time.”

7. Have a talent action plan (TAP). A TAP can list all leaders and key staff/roles within a function (e.g., finance, nursing) and for each individual captures a TAP that includes specific actions around retention, development, recruiting, succession planning, etc.).

“Most importantly, the talent review is not a once a year and done event. Typically, the talent review is held at the end of the first quarter or early second quarter, then there are multiple (e.g., quarterly) talent review check-ins during the year,” Taylor says. “Here each leader (e.g., CFO or CNO) would join a meeting with the CEO, CHRO, and peers, and report out on progress against the TAP. Too often C-suite leaders are holding ongoing monthly operating reviews to discuss quality, operations, finance, etc., but there’s little rigor around holding leaders accountable to a good say-do ratio on required people actions. The talent review check-ins help driving this people-side accountability.”

Tracey Walker is content manager for Managed Healthcare Executive

Recent Videos
Related Content
© 2024 MJH Life Sciences

All rights reserved.