Creating a new C-level role? 5 questions to consider ahead of time

The transition to value-based healthcare in the U.S. is driving a shift in talent requirements throughout all levels of hospitals and health systems. Many organizations are spotting need in the C-suite, especially, for new roles to focus on emerging aspects of the hospital business. 

One significant factor that has led to the creation of new C-suite roles is the continuing trend of consolidation. Many organizations have more eagerly pursued mergers and acquisitions in recent years to ensure they are optimally equipped to take on the fiscal and operational challenges associated with outcomes-based reimbursement. According to analysis from Kaufman Hall, hospital and health system transactions increased 18 percent from 2014 to 2015 and 70 percent from 2010 to 2015. This activity has carried into 2016: A Kaufman Hall report from July found that hospital and health system transactions were up 6.1 percent in the first half of 2016 from the same period in 2015.

"Healthcare organizations are becoming larger and more complex," says Lydia Ostermeier, vice president for senior executive search at B.E. Smith. As a result, "C-suite leaders' roles have grown tremendously in scope. Adding additional members to the team helps take some of that load off their plate."

While hospitals and health systems develop C-suite roles to meet their unique needs, several new roles are becoming especially familiar and popular, according to Ms. Ostermeier. These include chief experience officer, chief population health officer, chief medical information officer, chief nursing information officer, chief strategy officer and chief safety officer.

Each of these roles is designed to bolster leadership and more comprehensively address the challenges and complexities associated with their respective areas of work. 

Who should fill these new roles?
Often, hospitals or health systems that see the need to create a new role look for leaders or emerging talent within the organization to fill it. When taking this route, thorough succession planning, leadership development and coaching are essential, especially since the person appointed to the new role won't have a predecessor to look to as an example. Additionally, the organization and newly appointed leader must be prepared that much of the learning will occur on the job.

Another option for filling newly created roles is conducting an executive search. Healthcare organizations can elect to do this legwork themselves, but this often proves to be an extremely laborious and time-consuming process, according to Ms. Ostermeier.

Many instead enlist executive search firms to take the lead on such initiatives. In both scenarios, executive searches for brand new roles are more difficult than for traditional roles, as there is a much smaller pool of candidates with experience to choose from. Often, those conducting the search will identify a string of core competencies and skills for the new role. Those making hiring decisions are not necessarily constrained to hiring someone who has served in a similar position already, either. Some even select candidates from other industries beyond healthcare, according to Ms. Ostermeier.

5 questions to consider before creating a new C-suite role
If an organization needs an executive to focus exclusively on population health management, cybersecurity, patient satisfaction or any other concentration, they should first consider the following five questions, according to Ms. Ostermeier.

1. How will the new role create value? Every role in the organization must improve clinical, financial or operational outcomes. "It must be clear how the position will add value to the organization or it won't get the consensus and support it needs to move forward," says Ms. Ostermeier.

2. What will be the new leader's primary duties? There is often at least some crossover in responsibilities with existing executive positions, as no department operates in complete isolation, according to Ms. Ostermeier. As a result, the board and C-suite must carefully determine what the new leader will be accountable for individually and what duties he or she will share with their colleagues.

3. How will the new position change the current organizational structure? "Who will the new leader report to, and who are his/her direct reports?" says Ms. Ostermeier. In many circumstances, a leader in a newly created role doesn't have any direct reports at the start.

4. What skill sets must the leader in the given role possess? It's imperative to clarify exactly what kinds of skills and background experience a candidate for a new role should possess, in addition to education and certification.

5. How will the organization communicate the change to the staff? "Whether it comes from the CEO, the board or hiring manager, someone needs to communicate to the organization that they are getting a new chief experience officer, chief population officer, or whoever, so everyone understands they are recruiting a new executive," says Ms. Ostermeier. "No one should be caught off guard when the new person is hired."

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