January 17, 2017 – As expansion continues going strong and system-wide operations grow ever more complicated, the healthcare industry is facing a potential dearth of individuals ready to assume top leadership roles. This, combined with the sector’s exodus of experienced, traditional-style leaders and the current shift in power at the highest echelons of government, is making for particularly challenging days in an arena that has never lacked for challenges.
“I think an argument – and a strong one – could be made that there is not sufficient talent poised and ready to take on the C-suite level roles in the major national and super-regional health systems, particularly when you consider how large some of these organizations are getting through continued strong mergers and acquisitions activity,” says Martha Hauser, managing director and national healthcare practice leader at Diversified Search.
In healthcare, growth brings increased complexity, Martha told me when I interviewed her recently. These days, she says, the sector has a growing need for leaders who can negotiate the vagaries of the evolving environment and uncertain times.
“At the highest levels, the biggest issues for the healthcare industry surround managing disruption and a lack of clarity, especially given the changes coming due to the change of power in Washington,” she says. “The talent requirements for leaders designing and leading a more responsive, consumer-based integrated and increasingly complex health system are much different than in the past. Add in a larger-than-normal exit of more traditional leaders in the healthcare sector and you have a very volatile marketplace.”
Martha, who works out of Atlanta for Philadelphia-based Diversified Search, is certainly the right person to ask about such matters. In a career that has spanned 25 years, she has worked with hospitals, health systems, academic medical centers, higher education, and non-profits. Among her executive search accomplishments, she helped open Witt/Kieffer’s Atlanta office in 1997. She was also regional industry specialist for healthcare during her tenure at Spencer Stuart. At Tyler & Company, she had operational responsibility for the firm’s executive search practice.
Fierce Fight for Talent
For Martha and Diversified Search, the answer to healthcare’s leadership challenge most likely will come in recruiting talent from nontraditional sources. “The movement from volume to value, as defined differently by regulators and payers, along with the desires of consumers, is completely changing the playing field,” says Martha.
“Healthcare will continue to demand leaders with the skills it has always required – critical thinking, data analytics, customer service, the balance between technological innovation and cost effectiveness – but it will also need leaders with qualities that we have not always associated with healthcare: flexibility and the ability to pivot, digital connectivity and service, the ability to leverage social media, and, yes, even optimism. I don’t think there’s another sector in the country where the fight for top talent will be more fierce.”
These days, healthcare is more consumer-oriented. The need for clinical integration and transparency in regard to quality and outcomes is only growing. So it only makes sense that the qualities that the industry seeks in its leaders is in flux as well.
“There is a much higher need for innovation, for being nimble reacting to change, whether that’s in new technologies, regulation, or other market dynamics,” says Martha. “You’re seeing healthcare systems now looking outside of the industry for executives with proven experience in these areas.”
All of this has led Diversified Search to become more collaborative within its own ranks. “We have functional experts in areas such as supply chain, technology, marketing, and human resources who now spend a great deal of their time healthcare,” says Martha. “We’re able to leverage talent from other industries, given that some of the skill sets now needed by healthcare systems do not currently exist within the traditional ranks of the industry. I can think of numerous instances where healthcare systems have opted to recruit talent from other industries in order to drive the degree of innovation and change.”
Talent From Other Industries
And as the market continues to consolidate, she says, “I think you’re going to see even stronger recognition by boards that it’s vital that healthcare leaders have experience in mergers and acquisitions and a consumer focus, for example. As national and super-regional systems develop, this is where we’re really seeing the need for talent from other industries.”
Martha, for her part, is well suited for managing such change. Before entering the search industry, she worked for a brief time as an educational psychologist. After receiving her MBA, she signed on with a small healthcare search firm based in Atlanta. “Given that I have two sisters in healthcare – one a physician, the other a nurse – the idea of joining a healthcare recruiter just felt right,” she says. “And I think my experience as an educational psychologist helped me adapt quickly and learn the process of executive search, because I knew a great deal about assessment and how to manage multiple cases, skills which have proven to be invaluable.”
When Martha first entered the field, healthcare was much less complicated than today. Among other differences, she simply had less information to sift through and therefore could truly learn and absorb the industry.
“I am fortunate to call myself a ‘lifelong learner’ – I never grow tired of learning about the changes in healthcare, and there are many happening all the time,” she says. “It’s dynamic and energizing to incorporate those changes and demands into the process of identifying the right leaders for the right healthcare organizations at the right time. I also believe that people are always better when doing something they love. I soon learned that I loved the highly intelligent people in healthcare, who are there because they have a sense of mission and purpose in their work.” It’s a gift, she says, to find a career “where you feel that you are in the place that you belong, that you are making a difference.”
And that’s more than platitudes. Ask Martha about Diversified Search’s acquisition last fall of BioQuest, a San Francisco life sciences recruiter, and her excitement is palpable. “BioQuest is an amazing, dynamic search firm, and ouracquisition was a strategic move to address the emerging needs of our firm’s largest client base, which consists of large national and regional health systems, academic medical centers, and health sciences centers,” she says. “As larger health systems step up their investments in ‘precision medicine,’ we are being asked by these clients to assist them in identifying talent in these very specific spheres.”
By bringing BioQuest into the fold, Diversified Search is acknowledging the growing intersection between health services and life sciences. “It allows us to offer a full complement of experience and resources through both our healthcare and life science verticals, broadening our experience, content knowledge, and access to talent in areas such as healthcare innovation and medical devices,” says Martha. “No less important, BioQuest has dramatically added to our extensive networks with venture capital and private equity firms. In short, we viewed the acquisition as an avenue to the future of healthcare.”
Today, Diversified Search is seeing high demand for top talent in the behavioral health, urgent care, anesthesia, and dermatology fields, among others. And as Martha points out, BioQuest quickly strengthened the firm’s hand in the private equity sector. “BioQuest is a strong presence in the venture capital ecosystem; for example, it’s done CEO searches for six companies within the Ascension Ventures portfolio alone,” she says.
“Some 70 percent of BioQuest’s clients over the past decade have been private, venture capital-backed emerging technology companies. These cutting-edge firms live or die by the talent at the top of their org charts, so their backers are keenly involved in who these people are and how they are selected. BioQuest has only been a Diversified Search company since June, but already from a business development standpoint we’re really encouraged by what we’re seeing as its team dovetails with our healthcare, life sciences, and private equity verticals.”
Contributed by Stephen Sawicki, Managing Editor and Scott A. Scanlon, Editor-in-Chief — Hunt Scanlon Media