Climbing the Ladder to CEO, Part V: Lessons Learned

During the past 25 years as a senior healthcare leader, I have interacted with many physicians who aspired to become hospital and health system CEOs; few of them attained it.

For the most part, I have witnessed my colleagues’ careers change directions or stagnate, some by choice and some not. In this article, I share lessons learned from decades of observation and experience regarding the critical success factors. The lessons fall into three main categories: (1) commitment to self-development, (2) career management, and (3) team development. I will also share a few common show-stoppers.

Commitment to Self-Development

While this may be an anticlimactic insight, the single most important factor in reaching the corner office is an absolute commitment to becoming a senior healthcare executive. Note the reference is to healthcare executive not physician executive. You must have a genuine willingness to learn a new field and develop a new, broad scope of skills on par with the best nonphysician executives.

Underestimate the complexity of the position, the required breadth of knowledge and leadership capabilities, and you will likely fall short. After my first 10 years as a senior physician executive, I felt ready to be the CEO. I was wrong. Even after 25 years of experience I find myself drawing on everything I have learned — and I keep learning.

Clinicians’ education and training bring a valuable perspective to the C-suite; however, being an effective healthcare executive requires a whole new set of skills. These skills can be grouped into two categories, commonly referred to as hard skills and soft skills.

Hard skills include a working knowledge of subjects such as finance, human resources, quality improvement, information systems, operations management, and corporate compliance. These subjects require a different level of understanding when you transition from a physician practice or a single department to a large complex organization.

Yes, you can hire well-credentialed experts in these fields (and you will) but it is a common misperception that simply surrounding yourself with content experts sufficiently compensates for a lack of knowledge. This is akin to believing that an internist or emergency physician does not need to have a working knowledge of cardiology, pulmonology, neurology, or infectious disease. Just surround yourself with specialists — that should take care of it.

Your ability to pick up subtle diagnostic cues, to refer patients to the appropriate specialists, and to orchestrate all the data into a care plan is essential to your effectiveness. You need a working knowledge of the disciplines.

If you are in the pursuit of a CEO position, it is a mistake to bypass an advanced management degree. I once encouraged a seasoned physician leader to go back to school. He responded, “I don’t need to go back to school. I earned my ‘MBA’ though the school of hard knocks.” The hard knocks never ceased, doors shut, and his career did not progress.

For others who have taken my advice, this credential opened doors earlier in their careers. Even as a CEO who happens to be a physician, I will not hire a physician executive for a senior role unless they have or are actively pursuing an advanced management degree. It is not just a credential for a checklist — it builds a deeper understanding of business, develops a higher level of thinking, and demonstrates your commitment to an executive role.

The companion soft skills are at the core of leadership. They are the skills of human-to-human interaction. More nuanced and more difficult to develop than hard skills, soft skills include communicating, influencing, having difficult conversations, and earning credibility.

Communication is foundational. The CEO must be able to relate to groups of all sizes and at all levels for an array of purposes, including everything from creating pride in the organization, addressing unhappy employees, working effectively with the board, and interacting with community groups, to meeting with a high-level politician or addressing the media about an unfortunate event. Every audience the CEO communicates with requires a unique approach, vocabulary, and tone. Although some people seem to have a “natural” ability to communicate effectively, this is a teachable skill.

Throughout your career, your most critical asset or liability will be your ability to earn and maintain a perception of integrity. It was later in my career that I realized that integrity transcends far beyond honesty. As a simple example, imagine that you have informed a surgeon that you included robotic equipment in the capital budget. Sometime later there is a mechanical failure and you have no choice but to urgently replace a multimillion-dollar hospital heating system with the funds originally earmarked for the robotic equipment. Six months later the surgeon sees you in the hallway and asks about her equipment. You explain that the funds are no longer available.

You are being honest, but will the surgeon perceive you as having integrity? Would her perception of your integrity be different if you had reached out to her earlier, explained the situation, and discussed future options? Integrity is not something you earn passively. It requires proactive communication, approachability, listening, follow through, consistency, understanding before acting, and closing feedback loops. Be ever mindful or you will carelessly run afoul.

Honing your skills and translating them into capabilities such as strategic planning, change leadership, execution, team development, and organizational agility requires experience. Early in my career, I underestimated the depth of experience necessary to develop competency in these areas. The key is to have the right experiences.

Board memberships, medical directorships and committee appointments are great; however, you must have operations experience. This means that you need to be accountable for managing profit and loss, leading people, operating a service, and generating new business. The scale and scope of your experience needs to expand as you progress in your career, as do the corresponding accomplishments. Search committees tend to be risk averse. It is your level of experience and accomplishments that will give them the confidence that you are capable of the job for which you are being considered.

Every executive has strengths and weaknesses. Insight into oneself coupled with a persistent quest for improvement is often the determining factor between success and failure. For most executives who are passed up for promotion or involuntarily dismissed, their colleagues can clearly articulate the reason. Sadly, many of these executives cannot see or articulate the reasons themselves. They see themselves as victims of other people who underestimate their capabilities.

If you want to know where you stand in terms of leadership, it is important that you foster a source of consistent and reliable feedback. It can feel hurtful, but it is the greatest gift a friend or spouse can offer. An executive coach can be very helpful in this regard assuming the recipient has the capacity for insight and self-improvement. Inability to receive feedback and use it constructively is a fatal flaw.

Career Management

Early in your management career you are likely to be paired with an administrative leader, often referred to as a dyad partner. This is a great opportunity. Be a good partner, listen, respect, and learn. Over time you will need to progress into roles in which you are an executive in your own right. The person who was once a dyad partner will now become peer and colleague — the CFO, COO, CNO, etc. Embrace them as partners and they will provide a rich learning opportunity.

Always manage “down” with the same grace that you manage up so that you open yourself to learning from everyone around you. Career advancement can be tricky and there are three areas of consideration: readiness, working at the right level, and maintaining clinical practice.

You don’t know what you don’t know, and with experience, you become more mindful of this truth. Early in your career, however, this truth may not be sufficiently realized to modulate self-confidence. Some people just have a knack for getting promoted regardless of readiness. I have seen a good number of very self-confident, high-potential executives advance too early only to demonstrate lackluster performance, lose their positions, and not recover in the job market.

Pursue opportunity and advancement and, by definition, each progressive career step will require that you do something you haven’t done before. Before taking a new role or responsibility, simply be mindful of what will be required for success and where you are in your readiness. As a rule, you can take increasing levels of risk as you build your track record of accomplishments.

With each progressive step in your career you will be working at a new level. Elevating your ability to work at the right level is a challenge for many physician executives. As practicing physicians, we must attend to every detail — not doing so will eventually result in harm. As a senior executive, you must not attend to every detail — doing so will eventually result in harm.

You must understand your new role and think and work at the appropriate level. The flipside is that you need to understand what you should no longer be doing. Some refer to this as “delegation”; however, this term does not adequately convey the importance of this concept. The further you progress in your career, the more you will need to allow yourself to be dependent on others, their expertise, and their ability to get things done.

You will not have the capacity to know and manage everything as your areas of responsibilities grow in scope and scale. Always ask yourself one simple question, “Am I the only one who can do this?” If not, do not do it. Assign it. If you are saying “yes” too often, then you are working at the wrong level, and potentially toward another problem: team development. I have worked with executives who could not grasp this concept, attended endless meetings, and gravitated toward detail. As expectations grew they became less effective and increasingly stressed. At some point, these executives were no longer considered promotable.

Working at the right level as an executive is only part of the equation. There will come a point in your journey at which you will need to make a difficult choice. Do you continue practicing medicine or do you commit full-time to your leadership career?

The sage advice of yesteryears was that you must maintain your clinical practice to have “street cred.” I agree with this advice at leadership levels closest to the sharp point of care (e.g., ER medical director). However, at senior levels of leadership, I believe this advice to be less sage and actually harmful to the promotion of physicians as leaders.

Since I graduated medical school, more than 1,000 new medications have been FDA approved. The EMR has replaced paper and medical knowledge has exploded. Maintenance of certification requirements has been implemented and regulatory agencies have layered additional requirements. During the same period, healthcare organizations have become increasingly large and complex and the principles of management and leadership in the global and technology-enabled business environment have evolved greatly.

In today’s world, it is a rare individual who can be both a great clinician and a competent senior executive. Those who try to do both often find themselves compromised on both ends, missing important meetings or cancelling clinics. Leaving clinical practice is a difficult decision and it should not be entertained until you are significantly along in your leadership career. However, when the time comes, you would be well-advised to definitively choose your path.

Team Development

It is difficult to get to the top spot and almost equally difficult to stay there. You will not survive on past deeds. It is about what you delivered last year and what is anticipated to be delivered next year.

In truth, you will not deliver anything alone. Ultimately, your success will depend on the team around you. Successful executives understand this and are uncompromising in their pursuit of developing a strong team.

Other executives compromise their organizations and eventually themselves because they do not exercise the same level of diligence. This may be due to a tendency toward conflict avoidance or our natural desire to be liked, especially when decisions affect a friend or a well-liked individual. You will need to do what needs to be done; do it fairly and with compassion, but do it. This may not enhance your popularity, but remember that first and foremost you have a fiduciary responsibility to the organization you were hired to lead.

Having the grit to develop a strong team is different from having the capability to do so. This circles back to CEO skill development and having a working knowledge of the disciplines. For example, among your most critical team members is the chief financial officer (CFO). How will you assess the CFO’s competency? After a financial crisis? Even then, is it a matter of circumstances or competency?

Without a working knowledge of areas like margin generation, budgeting, debt capacity, and business transactions, the CEO is ill-equipped to evaluate competency. I have watched high-level executives lose their jobs because they allowed marginal performers, questionable integrity, and/or drama to exist within their teams — another fatal flaw.

Build a top tier team and you will continue to build credibility with your stakeholders as they observe higher levels of performance and interaction. Recruiting, developing, retaining, and leading high-performing teams must be a strong focus at every level of career progression.

Concluding Remarks

As I conclude this series of articles, I offer a few final remarks.

Success is seldom a straight-line path. A history of setbacks is more often the norm. A sitting CEO can speak humorously about past failures and hardships, engendering laughter from the crowds. It is not so funny in real-time — especially when coupled with uncertainty. Accept this, learn, and move forward.

Despite good decisions and best efforts, goals are not always achieved. Odds are not in your favor. Health organizations may have thousands of employees, only one of whom can be the CEO. Your journey will differ from mine, but I am hopeful that the insights shared in this article will remain applicable. I wish you success.

For me, the journey has been greatly rewarding and it is a great honor and pleasure to serve and lead as a health system CEO.