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Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
Succession Planning for Rural Hospitals
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Succession Planning for Rural Hospitals

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  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • Midwest Consultants for Rural Health All Rights Reserved
  • All Rights Reserved Midwest Consultants for Rural Health
  • Transcript

    • 1. IHA/ICAHN IHA/ICAHN Building a Strong Small and Rural Workforce for Tomorrow Succession Planning for Rural Hospitals April 2, 2008
    • 2. Succession Planning for Rural Hospitals <ul><li>Prepared by </li></ul><ul><li>D. David Sniff, </li></ul><ul><li>President </li></ul><ul><li>Midwest Consultants for Rural Health, Inc </li></ul><ul><li>[email_address] </li></ul><ul><li>309.338.4478 </li></ul>All Rights Reserved
    • 3. Introducing D. David Sniff <ul><li>33 years in Hospital Administration </li></ul><ul><li>FACHE </li></ul><ul><li>Served in Executive positions ranging from CAH to Senior Executive of a multi-hospital system </li></ul>All Rights Reserved
    • 4. Introducing D. David Sniff (continued) <ul><li>National award winning projects </li></ul><ul><li>Started MCRH in 2003 </li></ul><ul><li>Strategic Planning, Facility Assessment, Coaching, Transitional Assistance, Turnaround Assessment, Governing Board Ed. </li></ul>All Rights Reserved
    • 5. Learning Objectives <ul><li>Review what succession planning is for rural hospitals </li></ul><ul><li>Discuss why it essentially is nonexistent in rural hospitals </li></ul><ul><li>Develop a Plan for Succession vs. a Succession Plan focused on CEOs with some discussion of Dept Managers </li></ul>All Rights Reserved
    • 6. What is Succession Planning? <ul><li>The deliberate, organized effort to identify and prepare future leaders to succeed incumbent individuals in those positions when the incumbent departs. </li></ul><ul><ul><li>Involves predetermined plan of goals and objectives, training, and timeline for implementation. </li></ul></ul><ul><ul><li>Is supported and approved by governance </li></ul></ul>All Rights Reserved
    • 7. Status of Succession Planning in Hospitals <ul><li>Articles abound geared to larger facilities with depth of resources </li></ul><ul><li>Even then, still under 50% </li></ul><ul><li>Why? </li></ul><ul><ul><li>CEOs have too much on their plates and boards don’t raise the issue </li></ul></ul><ul><ul><li>“ Our CEO is a ‘young’ person, so why worry?” </li></ul></ul><ul><ul><li>“ We’ll deal with it when we have to” </li></ul></ul>All Rights Reserved
    • 8. CAH Rurals vs. Non-rural <ul><li>CAH’s, by and large, do not have the depth of human resources </li></ul><ul><li>Some have COOs, but they may not be candidates for CEO </li></ul><ul><li>Presumed not to be possible since there isn’t a successor, i.e., no VP, no Assist Administrator </li></ul><ul><li>It’s somewhat akin to writing a will (psychologically) </li></ul>All Rights Reserved
    • 9. Reasons Why Succession Planning is Needed <ul><li>Reduces chaos or degree of confusion and apprehension </li></ul><ul><li>Provides stability during what can be a most difficult time </li></ul><ul><li>It is professionally incumbent upon a CEO to leave his/her organization with the satisfaction s/he has prepared for the future </li></ul>All Rights Reserved
    • 10. Reasons Why Succession Planning is Needed (continued) <ul><li>Turnover among CEOs is 16% or one in six years (rural seems to be in line with urban) </li></ul><ul><li>Some areas are higher Nevada 33%, Hawaii 23%, Utah 6% as of 2006. (Trustee Summer 07). </li></ul><ul><li>Like the rest of the population, CEO boomers are aging and the class of ’46 will reach 65 in 2011 IF they plan to work to 65 </li></ul>All Rights Reserved
    • 11. What would your hospital do if the CEO suddenly departed? <ul><li>Panic? </li></ul><ul><li>Appoint the CFO, CNE or someone else ? </li></ul><ul><li>Appoint a “team” leadership? </li></ul><ul><li>Find a senior manager who would say yes? </li></ul><ul><li>The Chairman of the Board becomes acting CEO or some other Board member, (generally retired) </li></ul>All Rights Reserved
    • 12. What would be the process of appointing an “acting” or “interim”? <ul><li>Draw straws among the management team </li></ul><ul><li>Tell everyone to carry on as usual until the board has an opportunity to figure it out </li></ul><ul><li>Go on line and EBay search under Rural Hospital CEO </li></ul><ul><li>Board Hire a recruiter and instruct them to find a rural hospital CEO </li></ul>All Rights Reserved
    • 13. OR… Develop a Plan of Succession! <ul><li>The focus is on a planned approach not finding a person </li></ul><ul><li>It includes appropriate individuals in its design as chosen by the Board and hopefully involving the CEO </li></ul><ul><li>The CEO develops the DRAFT materials and tools </li></ul><ul><li>It is reviewed at least annually to ensure its appropriateness (suggest same time as Board or CEO Evaluation activity) </li></ul>All Rights Reserved
    • 14. Suggested Preliminary Steps <ul><li>CEO brings the topic up to the Board Chairman (have at least a topical outline written before just bringing up the subject cold) </li></ul><ul><li>Quickly explain this is proactive and not a hint you are leaving </li></ul><ul><li>Go over the outline with the Chairman and, depending on the hospital’s culture, determine going forward steps </li></ul>All Rights Reserved
    • 15. Suggested Preliminary Steps <ul><li>Assuming the Chair is supportive, further develop at least some elements of the plan in draft form to present first to the Chair and then to the full Board or Executive Evaluation/Compensation Committee </li></ul><ul><li>The Chair should introduce the subject at the Board Meeting and suggest the CEO be charged with developing elements of the plan to be introduced later. </li></ul>All Rights Reserved
    • 16. Suggested Preliminary Steps <ul><li>Develop a file to be kept in the CEO’s office “Plan of Succession” </li></ul><ul><li>Include a check list of all elements in the plan and the review schedule </li></ul><ul><li>Make sure the CEO’s assistant and the Chairman know where the file is located, or provide the Chairman with a duplicate file. </li></ul>All Rights Reserved
    • 17. Suggested Preliminary Steps Checklist <ul><li>Determine who will be the official spokesperson. This is generally the Chairman of the Board or a Board member with experience in speaking with media who will be there the day of or soon after CEO’s departure </li></ul><ul><li>Develop a draft notification protocol memo that can be tailored to the circumstances surrounding the CEO’s departure </li></ul>All Rights Reserved
    • 18. Suggested Preliminary Steps Checklist <ul><li>Include in the memo who is to be notified in what sequence, admin team, hospital Board members of and any other Boards in the organization, medical staff, personnel, Auxiliary, Volunteers and Media. </li></ul><ul><li>Notify the State Department of Health of departure and who should be called in the immediate future re any issues </li></ul>All Rights Reserved
    • 19. Plan of Succession: The Committee <ul><li>Appoint a Plan of Succession Committee </li></ul><ul><li>This can be the Executive Committee of the Board and some ex-officio appointments, e.g., Pres of Med Staff if not already a member. </li></ul><ul><li>Some may include Auxiliary Pres or Chair of Volunteers, Ministerial Rep, others? </li></ul><ul><li>Establish the duties and responsibilities of the Committee </li></ul>All Rights Reserved
    • 20. Plan of Succession: Who’s in Charge? <ul><li>Suggest the CEO be named the facilitator or the staff person charged with bringing the information forward in DRAFT form. </li></ul>All Rights Reserved
    • 21. Plan of Succession: What Next? <ul><li>Review the CEO position description </li></ul><ul><ul><li>Does it meet the current and future needs of the organization? </li></ul></ul><ul><ul><li>What skill sets will be most important to the organization? </li></ul></ul><ul><ul><li>What personality, character traits are desired? </li></ul></ul><ul><ul><li>What are the academic/experiential qualifications needed? </li></ul></ul>All Rights Reserved
    • 22. Plan of Succession: Is there someone on Admin Staff? <ul><li>Is there a person who could and would accept being named acting CEO? </li></ul><ul><li>Part of the determination should be what they will be asked to do </li></ul><ul><li>Spell out the Acting CEO’s duties and responsibilities </li></ul><ul><li>Determine up front if Acting is also viable candidate for CEO (issues) </li></ul>All Rights Reserved
    • 23. Appointing Acting Issues <ul><li>If the Acting CEO is a candidate from within and is a serious candidate for CEO, other applicants will want to know </li></ul><ul><li>If the Acting CEO from within is NOT selected, serious evaluation needs to be made about his/her continued employment </li></ul><ul><li>If he/she was NOT expected to be named CEO, the same issues are generally not present </li></ul>
    • 24. Appointing Acting Issues, cont’d <ul><li>If the Acting is not selected and was a serious candidate, an exit strategy needs to be developed including transition counseling and assistance </li></ul>
    • 25. Plan of Succession: Acting CEO’s Duties etc. <ul><li>Day to day operations </li></ul><ul><li>Establish parameters for: </li></ul><ul><ul><li>Purchasing </li></ul></ul><ul><ul><li>Spending </li></ul></ul><ul><ul><li>Hiring </li></ul></ul><ul><ul><li>Discipline </li></ul></ul><ul><li>Set in writing what must be approved by the Chairman or other officer of the Board </li></ul>All Rights Reserved
    • 26. Plan of Succession: No one in the house <ul><li>Consider an interim CEO organization </li></ul><ul><li>Identify at least two companies to contact and include their contact information in the CEO Plan of Succession folder </li></ul><ul><li>Include other pertinent information, e.g., web site, references, who to contact </li></ul><ul><li>another option is to.. </li></ul><ul><li>Consider a company who can immediately assess the hospital’s current condition in a two-three day visit. </li></ul>All Rights Reserved
    • 27. MCRH <ul><li>YEAH we can do that </li></ul>All Rights Reserved
    • 28. Plan of Succession: Interim Checklist <ul><li>Ask for an all-inclusive sample contract, fees, expenses, etc. </li></ul><ul><li>Experience in working with CAH’s </li></ul><ul><li>The duties of the interim being provided </li></ul><ul><li>The candidate(s) preferably have CAH experience </li></ul><ul><li>Committee or at least the Chair should have opportunity to meet the interim and </li></ul><ul><li>review status, expectations, and communications process </li></ul>All Rights Reserved
    • 29. Plan of Succession: Interim Checklist cont’d <ul><li>CEO consultant could screen candidates </li></ul><ul><li>Set weekly meetings between Chair and Interim </li></ul><ul><li>Interim should provide Chair weekly report of activities </li></ul>All Rights Reserved
    • 30. Plan of Succession: Hiring a CEO Search Firm <ul><li>Recommend the hospital not go it alone </li></ul><ul><li>Why? Who in the organization or on the Board has experience hiring executives? </li></ul><ul><li>Too many times this leads to unsuccessful choices, increased turnover </li></ul><ul><li>“ How can this be much different than hiring a CEO for the bank?” </li></ul>All Rights Reserved
    • 31. Plan of Succession: Criteria in Selecting a Firm <ul><li>I’ve never met a search firm that wasn’t the best </li></ul><ul><li>Identify three firms for consideration </li></ul><ul><li>Find them through networking; or your Hospital Association may be a good source </li></ul><ul><li>If using a hospital consultant advisor, s/he may be able to help with the search or the process </li></ul>All Rights Reserved
    • 32. Plan of Succession: Check List for Search Firm cont’d <ul><li>Who will be principal contact with the firm? </li></ul><ul><li>Identify references in your state </li></ul><ul><li>If not any searches in your state, probably should pass on this one </li></ul><ul><li>Obtain a sample contract including all fees </li></ul><ul><li>Retainer firm= down payment and balance after successful search. Should include a guarantee s/he will “stick” </li></ul>All Rights Reserved
    • 33. Plan of Succession: Search Firm cont’d <ul><li>Fees range from 20-something percent to 30-something, with the average around 30% of BASE PAY! </li></ul><ul><li>CAH average salary range $120-$200K, so the fee could be $36 to $60K </li></ul><ul><li>Boards may balk at that kind of fee </li></ul><ul><li>What is the firm’s average placement time for like-sized facilities in similar areas? </li></ul><ul><li>What is the firm’s policy if the search time exceeds the contract provision? </li></ul>All Rights Reserved
    • 34. Option <ul><li>A hybrid approach could be to use a consultant to the Board who could do one or more of the following: </li></ul><ul><ul><li>Advise with respect to the search process, review documents and materials, screen candidates, set up the review process, sit in on interviews, etc. </li></ul></ul><ul><ul><li>Fee based dependent on tasks performed </li></ul></ul>All Rights Reserved
    • 35. Plan of Succession: Communications Process <ul><li>Make regular reports of the search process to: </li></ul><ul><ul><li>Board </li></ul></ul><ul><ul><li>Medical Staff </li></ul></ul><ul><ul><li>Admin Team </li></ul></ul><ul><ul><li>Media if asked </li></ul></ul>All Rights Reserved
    • 36. Plan of Succession: TAKE YOUR TIME <ul><li>Make the best decision </li></ul><ul><li>Don’t make the quickest decision </li></ul><ul><li>The range of time to find the right CEO </li></ul><ul><ul><li>3 months to a year, generally less than six months. </li></ul></ul>All Rights Reserved
    • 37. Plan of Succession: Manager Considerations <ul><li>Generally within the purview of the CEO or next senior level executive </li></ul><ul><li>Develop check list </li></ul><ul><li>Determine if there is a likely successor </li></ul><ul><li>Review the current managerial position description </li></ul>All Rights Reserved
    • 38. Plan of Succession: Manager <ul><li>If no candidate , look to next senior person to be temporary acting and set parameters for authority and communicating </li></ul><ul><li>Use the job description as a guide </li></ul><ul><li>Once the person is selected, review routine functions </li></ul><ul><li>Conduct department meeting to explain the role and expectations </li></ul>All Rights Reserved
    • 39. Plan of Succession: Manager cont’d <ul><li>Have weekly meeting with acting manager </li></ul><ul><li>Acting manager should keep a diary of accomplishments, actions </li></ul>All Rights Reserved
    • 40. Plan of Succession: Manager cont’d <ul><li>A candidate is identified or comes forward </li></ul><ul><li>Name the most likely Acting Manager while the process of selection is underway and discuss the same procedures as above </li></ul>All Rights Reserved
    • 41. Plan of Succession: Manager cont’d <ul><li>Techniques for selection, no right way </li></ul><ul><ul><li>Solicit input from other employees </li></ul></ul><ul><ul><li>Ask them to write a short note about why s/he should be manager or not </li></ul></ul><ul><ul><li>Review each prospect’s resume and job performance </li></ul></ul><ul><ul><li>Look for comments about behavior traits,e.g., leadership, self starter, team player, not the technical skills </li></ul></ul>All Rights Reserved
    • 42. Plan of Succession: Manager cont’d <ul><li>Techniques cont’d </li></ul><ul><ul><li>Ask the prospect to put in writing why s/he should be considered for manager </li></ul></ul><ul><ul><li>Ask the prospect what supervisory or management courses s/he has taken </li></ul></ul><ul><ul><li>Conduct interviews of all prospects as you would with any new hire and ask the same questions </li></ul></ul>All Rights Reserved
    • 43. Plan of Succession: Manager cont’d <ul><li>A candidate should surface after these actions </li></ul><ul><li>Consider appointing as Acting Manager </li></ul><ul><li>Adjust salary, good rule of thumb 10% </li></ul><ul><li>Set ninety day goals and objectives being very specific about who will do what and when </li></ul><ul><li>Measure progress </li></ul>All Rights Reserved
    • 44. Plan of Succession: Manager cont’d <ul><li>Develop a continuing education plan </li></ul><ul><li>Consider job shadowing with a qualified department manager from another facility </li></ul>All Rights Reserved
    • 45. Succession Planning for Rural Hospitals <ul><li>Questions? </li></ul><ul><li>For more information contact: </li></ul><ul><li>D. David Sniff </li></ul><ul><li>President, </li></ul><ul><li>Midwest Consultants for Rural Health, Inc. </li></ul><ul><li>[email_address] </li></ul><ul><li>309.338.4478 </li></ul>All Rights Reserved

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