ABOUT THE SERIES: H&HN's bimonthly "Generations in the Workplace" series focuses on the challenges of four generations of employees working side by side in the hospital. Over the course of 2013, we will examine their different expectations and work habits, and what it takes to maintain a spirit of good will and cooperation.

Framing the Issue

  • As baby boomers retire, hospitals face a serious gap in leadership.
  • Many hospitals have inadequate programs to identify and train new leaders.
  • Even well-established mentoring programs often fail to account for the different expectations Gen Xers and Gen Yers bring to the workplace.
  • Leading-edge hospitals have established administrative fellowships and residencies that provide broad-based experience for graduates of health care master's programs.
  • For some, rural hospitals provide the best opportunity for close-up training with top executives across an entire organization.

Every year, Ochsner Health System in New Orleans handpicks a dozen or so recent health care MBA graduates to enter its administrative residency program. The fellows spend a year rotating tohrough different divisions in the system.

After the year is up, some participants clearly don't fit the roles they had set out to fill. Others leave for different hospitals within a few years. And some — like two recent finance fellows who decided they'd prefer to run clinics than work in the business office — go on to serve in other areas of the health system than originally planned. Both of those individuals were quickly promoted to clinic manager positions.

Oschner's finance director was none too thrilled to lose two good people to other divisions, but understood it was part of the deal. "We're very keen on training them, but we're also keen on giving them different kinds of experiences," says Joan Mollohan, Ochsner's senior vice president for human resources.

In the past decade, about 75 fellows have graduated from Ochsner's program, and 20 to 25 remain in the system in leadership roles. Alumni include Ochsner's chief operating officer, as well as COOs and CEOs of individual hospitals.

What accounts for the success of the residency program? One big reason is that it's designed with 25- to 35-year-olds in mind. Most of these Gen Xers and Millenials want to move up quickly, and they're ready to change jobs to do so. And once they've tackled one challenge, they're eager for the next.

"In many organizations, if you're moving around laterally, it's not perceived as a good thing," Mollohan says. "In our organization, it's seen as something special because you're gaining experience. You can move laterally and get promoted, get a raise."

Too many health care organizations have alarmingly feeble strategies to identify future leaders and give them opportunities to learn and broaden their skill sets. Even fewer take into account that Gen Xers and Millennials often have different professional and life goals than their baby boomer counterparts.

In a 2012 survey by the recruiting firm Witt/Kieffer, 52 percent of responding CEOs said that no one at their organization was ready to step into their role.

Meanwhile, he turnover rate for hospital CEOs has been around 16 percent for the last few years, according to the American College of Healthcare Executives, and is expected to surge as boomers retire.

"One of the things we're finding is so many of the leadership positions in heath care are filled by baby boomers," says Jim Diegel, president and CEO of St. Charles Health System in Oregon and head of the American Hospital Association's Committee on Performance Improvement. "And we are starting to exit at a pretty rapid rate."

Diegel says that he and other health care leaders worry "that there is not enough tenured and experienced talent in the pipeline" to fill the open positions. "I think there's just a huge chasm that's following us."

More flexibility, more training

Understanding generational differences is critical to the success of any leadership development program. For example, Millennials and Gen Xers want flexible schedules, front-end compensation, and weekly and daily challenges to keep them interested and engaged, says Mike Supple, senior vice president of B.E. Smith recruiting firm.

And more is being demanded of hospital leaders. "Just being a boomer and pulling into a dark parking lot in the morning and staying until 7 at night isn't enough in this market anymore," Supple says, "especially in these larger systems where quality is driving outcomes. We are seeing experience and an advanced degree — an MBA, a CNO — play an important part. We're seeing a great demand for their services. And they're recruited off the streets very, very quickly."

The change has come just in the past couple of years, with hospital consolidations and redefinitions of business models, says C.J. Bolster, vice president and leader of the national health care practice at the Hay Group consulting firm.

"Hospitals have historically been very functional," says Bolster. "This department and this department and this department. Now you have to be more facile across complicated matrices. It requires a completely different set of behaviors than if I'm just overseeing the department of pharmacy."

For hospitals large and small, that can mean juggling a slew of techniques to keep younger leaders happy and engaged, while mentoring them closely and giving them broad experiences across departments.

"You really have to work hard to identify leaders early in their careers," Bolster says. "And we've got to be willing to give folks with leadership capabilities chances. I believe it's far more than the technical MBA kinds of things. Aggressively developing your talent for the world you [foresee] is a far better long-term strategy than pulling talent in from the outside."

What makes a good fellowship?

Large hospitals have been grooming new leaders through administrative fellowships since at least the 1950s, but these programs have proliferated as graduate health care administration programs have grown. The best of these fellowships, says Carrie Owen Plietz, CEO of Sutter Medical Center in Sacramento, Calif., offer opportunities to work across departments at a high level and have paths in place so the recruits can move up quickly and take on increasing responsibility.

Plietz in 2010 received the Robert S. Hudgens Memorial Award for Young Healthcare Executive of the Year from the American College of Healthcare Executives. A decade earlier, she had been an administrative fellow at Sutter Health while finishing her graduate degree in health care administration at Virginia Commonwealth University.

During her fellowship, Plietz worked closely with two preceptors: a hospital CEO and an executive vice president of the entire system. She met with each one-on-one at least every other week and was a full participant in Sutter's senior management team, attending the highest-level meetings, learning global strategy and having access to confidential information.

One of Plietz's projects during her residency included leading the startup and development of a transitional intensive care unit. She worked across the hospital with multidisciplinary teams that included vice presidents, physicians, directors, nursing staff and housekeeping. She says it was an invaluable part of her training, and one she would have missed if she had just stepped into a mid-management job right out of graduate school.

"You got to see from top to bottom how issues were decided and communicated throughout the organization," Plietz recalls. "In my opinion, it should be a requirement" for health care administration graduates.

Lacey Sapkiewicz, now the director of cardiovascular business development at Beaumont Hospital in Michigan, says the key to her successful fellowship was the administration's willingness to give her responsibility throughout the system and create incremental positions for her to step into so she could move up. During her yearlong apprenticeship, she worked with the orthopedics department on a strategic business plan for 2010 and an expansion plan for Beaumont's Royal Oak campus.

But when the fellowship ended, where would she go next? The traditional management positions were filled, Sapkiewicz says, with "Beaumount lifers — people who have grown up through the ranks. Maybe they started as a tech, then got into a manager role and worked their way up."

She realized there weren't a lot of positions she could jump into. "You're having this great experience, but what's next?"

So the hospital created a new position for her: operations support specialist. Beaumont now has a handful of administrators with that title across the system.

Sutter Health has five or six fellows every year. But even small independent hospitals, Plietz says, can benefit from taking on a fellow.

"It's not a significant investment," she says. "You're not paying these students senior-level salaries. It's really an entry-level job salary — usually, if you pick the right person, you get two or three times the investment. And so does the student."

Grooming rural leaders

Tiny Pratt (Kan.) Regional Medical Center isn't exactly a buzzing hive of newly minted health care administrators. "The air out here, it reeks of cow dung," says Austin Gillard, administrative fellow at Pratt. "People are not going to move out here, no matter how good the money is."

Yet, 25-year-old Gillard left a six-figure job in health care recruiting in Overland Park, Kan., to take a yearlong fellowship at Pratt that paid far less. While working on his executive master's in health care administration at the University of Missouri, Gillard came up with the idea of creating a rural hospital residency. He used fellowship guidelines on the ACHE website to develop the idea and sought out hospitals to take him on for a year.

Gillard approached other hospitals in Kansas, but chose Pratt because its administration — including Susan Page, who had been CEO for 20 years — had a long tenure and because Pratt was about to absorb a number of small, rural hospitals and break ground on a $30 million expansion and renovation.

He admits he had high expectations. "I wanted to be mentored by a CEO and a CFO," says Gillard, "because a CEO sees the big picture and a CFO understands finances and, most of the time, operations. So I was looking for those two skill sets and long-term training. I don't want to learn from someone who only has three years of executive training."

When he called Page, she agreed to meet him on a Sunday afternoon and he drove out. "I wasn't interested in applying for any of the residencies in these big, integrated systems," Gillard adds. "At Pratt, I was there seven days and I'd already sat in on multiple high-level meetings with our board of directors — strategic planning, finance committee meetings. You're not going to be a part of that on one of those big fellowship tracks."

Brock Slabach, senior vice president of member services at the National Rural Health Association, says his organization would like to expand on Gillard's idea and partner with hospitals in a rural track fellowship program. "We can be a cheerleader for it, but it's dependant on each local hospital to make the decision to participate," he says. ". It isn't an unpaid internship. They're paying this young man. But it's an investment in terms of future talent to lead our rural hospitals."

Other alternatives

In March, ACHE had about 20 online postings for administrative fellowships at places including Ochsner, Intermountain Healthcare, Yale New Haven Health System and the Mayo Clinic. But residencies aren't the only way hospitals are preparing staff for leadership positions.

Orlando (Fla.) Health doesn't go the administrative fellowship route. Rather, each manager in the organization is expected to identify at least two successors and develop them. Their names are entered into a database of about 1,800 employees with leadership potential. When the hospital has a special project, it goes to that database to see who might be a good fit for the new opportunity.

Managers are expected to work closely with their probable successors, give them projects and set goals. Every year in their annual review with their CEO, the managers must report on what they have done to develop their protégés in the past year and what their plans are for next year.

"That's changing the mindset from years ago that 'knowledge is power and I want to make myself indispensible,'" says Nancy Dinon, vice president of human resources at Orlando Health. "Health care's just a wild business. We really want to make sure we have people who are agile. Agility is important. We also don't want an entitlement to a certain role, because that role may not be there by the time their skill set's ready."

Dinon, who hails from the baby boom generation, says she's seeing younger up-and-comers asking more questions than her generation did about opportunities before they take them and wanting to negotiate more. Orlando Health has been careful to build a culture around flexibility whenever possible — the system CEO talks about the importance of being able to break away for "mandatory Mom events" like her own kids' school plays and encourages managers to be understanding.

"It's important for the younger generations to have a balance," Dinon says. "They want the tools and the resources they feel they need to be successful. But they've seen their parents work incredible hours at some organization. And they want to be there for their families. I think it's admirable.

Laura Putre is a freelance writer in Cleveland.

Executive Corner

What are two things your hospital is doing to mentor younger leaders?

Christina Freese-Decker
President, Spectrum Health United Memorial

1. We're working on providing shadowing or internship experiences for those in school. We're opening it up to various colleges in the area. Somebody just shadowed me for three weeks to get a sense of what the job involves. We open up the program to any area of the hospital. Once we find out what a student is interested in, we see who is willing to take a shadow.

2. Administrative fellowships, which I highly recommend. You're one-on-one with the organization's leadership team. During my fellowship, I was able to meet with the president and CEO of the whole system on a biweekly basis and ask why he chose a certain way to go. I also participated in the board meetings and the strategic retreat. If I can come in at just a middle-management job, I wouldn't have had that kind of behind-the-scenes access.

Bill Sexton
CEO, Prairie du Chien Memorial Hospital

1. We encourage participation in professional organizations like the American College of Healthcare Executives and the Wisconsin Organization for Nurse Executives. That way, staff is not only getting professional training, but benefits from the interaction with other professionals — not only to share knowledge but to gain knowledge from others doing the same sorts of things.

2. We have a very strong Lean effort, and we have senior leaders who facilitiate the teams throughout the hospital. We provided the initial course for all the senior leadership — 18 participants — and then came back and did a secondary course. We then did separate courses that were orientations for all employees. We've saved more than half a million dollars in waste costs that resulted from Lean projects. And it has improved quality and performance.

Mentoring in all its forms

If you can be a little creative about it, old-fashioned mentoring is a viable — and relatively inexpensive — way to develop leaders, says C.J. Bolster, vice president and leader of the national health care practice at the Hay Group consulting firm. "It may be difficult to find the time, so you have to look for opportunities. You can develop talent while you're doing something else."

Bolster sees long car rides to visit clients as an excellent mentoring opportunity. "You can have a pretty good conversation if you can block out all the other things going on."

Cohort groups can be beneficial, too. "Having a class of 10 or so emerging leaders built into your process — just a group to get together to build relationships and share common experiences — we have found to be very helpful," Bolster says.

At Beaumont Hospital, Royal Oak, Mich., Lacey Sapkiewicz, director of cardiovascular business development, took the initiative to reach out to other fellowship programs at large hospital systems in the area, starting a group for early careerists. About 15 or 20 alums and current fellows show up at the quarterly get-togethers of the Metredo Detroit Young Healthcare Professionals.

"We talk about what we're doing in our jobs and how it's going," she says. "We've found it to be very helpful, sharing common experiences and asking, 'How did you handle this?' or 'This is something we're facing — do you have any advice?' "

At Ochsner Health System, the fellows tend to come from a handful of feeder colleges around the country and find plenty of opportunities to socialize. But Joan Mollohan, senior vice president of human resources, likes to encourage intergenerational bonding.

When boomer executives and their young recruits find out they actually have things in common, she says, the connection is golden.

"Boomers are three-quarters away from paying for their houses; their children are educated; and they've already been through some of the life experiences Generations X and Y are going through," says Mollohan. "When a young person says, 'I've got to get to day care. How did you do it?' " the boomer can understand. — Laura Putre

Health care is in good hands in S.E. Michigan

The Metro Detroit Young Health Care Professionals Network gets together several times a year at a local eatery to discuss health care issues, career ambitions and job opportunities. The meetings are part social and part networking. The mood is casual and relaxed. H&HN asked the group, "Why did you choose health care as a profession?" and "Where do you see yourself in 10 years?" Their answers reveal that we should have some great stewardship in the future.

Why did you choose health care as a profession?

In high school, I went to a job shadow day at a hospital. I started college thinking I wanted to be a radiologist. After I started classes, I realized it was not what I wanted to do the rest of my life. I found health care management and loved it! — Megan Hutton, 26, operations support specialist, Women & Children's Services, Beaumont Health System, Royal Oak, Mich.

It was a mission-based decision. I liked the idea of doing what I like and making the world a better place. — Benjamin Dzialo, 27, process excellence, Trinity Health, Livonia, Mich.

I was always drawn to volunteering in the community and found the most reward from public health. The fact that at the end of the day, our job is to bring health to people and communities — it is so specialized and unique to this profession. — Madelyn Verlin, 26, director, group practice improvement, Henry Ford Medical Group, Henry Ford Health System, Detroit.

From a young age, I spent my time volunteering with nonprofit organizations focused on reducing health disparities. — Abrar Founas, 25, administrative fellow, Beaumont Health System, Royal Oak, Mich.

It started with an interest in how medical devices could be used to treat patients and improve their health. — Brian Vargo, 31, project manager, Beaumont Health System, Royal Oak, Mich.

As early as high school, I noticed pressing health concerns in my community. I was struck by the high prevalence of obesity, chronic illness and avoidable deaths. As a health care executive, I could ensure that innovative community-based programs could be developed to provide health education and enhanced access to quality health care. — Denise Lagrace, 29, senior consultant, integration management office, Trinty Health, Livonia, Mich.

Where do you see yourself in 10 years?

I'd like to be working in health care marketing at a leadership level. — Brandi Zielke, 30, senior marketing coordinator, Beaumont Health System, Royal Oak, Mich.

I think we are going to see a grand transformation of health care delivery in the United States. The jobs that my peers aspire to may not even exist 109 years from now. So my answer is, I really don't know. But I enjoy the ambiguity! — Benjamin Dzialo, 27, process excellence, Trinity Health, Livonia, Mich.

Overseeing and starting a population-management program. — Michelle Ilitch, 28, health care analyst, value partnerships, Blue Cross Blue Shield of Michigan.