Category Archives: Job

Should I pursue professional credentialing?

I need to start this article with a disclaimer.  I am HIGHLY BIASED in favor of professional credentialing.  If this is offensive to you, stop reading this now.  I am fairly well credentialed.  I have a Masters of Business Administration degree and a Doctorate of Science in Healthcare Administration.  I hold Fellowship certifications from both the Healthcare Financial Management Association (HFMA) and the American College of Healthcare Executives (ACHE).  I hold HFMA certifications in Managed Care and Patient Financial Services (PFS).  I am in the first class to be certified by HFMA in managed care and I was the national co-valedictorian in my HFMA PFS exam class.  I served a sentence on HFMA’s Board of Examiners (BOE) including a year as Chairman of the BOE.  The BOE is responsible for HFMA’s professional certification program.  Other than this, I have not done much to improve myself professionally or promote professional certification.

Lest this come across as self aggrandizing, you should know that I had a rough time in high school but ended up being the first in my family to earn a bachelor’s degree and that undergraduate degree was bestowed by The University of Virginia’s McIntire School of Commerce.  One of the highlights of my service to the healthcare profession is my service on HFMA’s BOE.  A number of changes to the HFMA certification process occurred during my service on the Board and as the Chairman of the BOE that I am very proud of.  Changes that were focused on making the certification process more objective and making the preparation process more efficient.

You’re damn right I think credentialing is important.

More than anything else, I think a professional credential makes a statement about you.  I discuss this in my article about getting ahead.  Holding professional credentials makes a statement  that you have shown willingness to go beyond the minimum required by a job to be recognized by your peers in your discipline as being one of the best among them and an example for others seeking career advancement and improvement.

Professional certifications usually require a combination of education, experience and ability to demonstrate mastery of a discipline.  The effort required to obtain a credential is useful in that in the process of achieving the recognition, it is impossible to not learn something or possibly a lot.  This knowledge is helpful in career development and can differentiate you from your peers in a competitive job or search situation.  Among your peers, those with professional certifications are typically held in higher esteem.

For some credentials and some disciplines, certifications are minimum requirements for certain roles.  There was a time when holding an ACHE Fellowship was practically a minimum requirement for becoming a hospital CEO.  That is not as true today because of the shortage of FACHEs and the effects of some head-hunters focused on making their own jobs easier by convincing Boards of Directors that requiring professional certification will unnecessarily restrict the pool of candidates.  My question of a Board making a decision like this is why would they want to expand their net to catch applicants that did not feel that getting certification in their discipline was important?  Ironically in hospitals, these Boards preside over medical staffs that increasingly require Board Certification of their members.  My question is if they support requiring Board Certification of their physicians, why would they intentionally establish a lower threshold for the executives operating the organization?  If the demand was higher for certified leaders, it could result in an remuneration differential and lead to more executives seeking certification.  If I was advising a Board or a hiring executive, I would and have required headhunters to build a very strong case for recommending consideration of a non-certified executive when certified executives are available.

If you are an executive that is interested in career advancement, my advice is that credentialing is one of the first things you should consider.  The type of credentialing you pursue can vary depending upon your current or desired role.  In nursing for example,  a wide variety of credentials are available.  Many nurses carry several credentials.

We have all heard the adage that if something was simple or easy, everyone would have it. This principle certainly applies to credentialing.  Credentialing can be expensive, time consuming and difficult.  Credentials require a combination of minimum education, in-role experience, examinations, service under the tutelage of another certified leader and the like.  Each discipline has a process for determining the requirements for one of their members to be recognized as the best among them.  Some are more rigorous than others.  An argument can be made that the more onerous the process, the higher the value of the credential and the greater the degree to which a credentialed executive is set off from his peers.  In the case of HFMA, the credential is a Fellowship and it is earned by less than 10% of the members.  If you are a HFMA member, start paying attention to the certified status of your peers and look at their career advancement success compared to the 90%+ of uncertified members.  It should not surprise you to discover that the type of people that pursue professional certification are the same type of people that tend to advance their careers faster than others.  Is it the credential?  To a degree, I would argue that the answer is yes.

Please feel free to contact me to discuss any questions or observations you might have about these blogs or interim executive services in general.  As the only practicing Interim Executive that has done a dissertation on Interim Executive Services in healthcare in the US, I might have an idea or two that might be valuable to you.  I can also help with career transitions or career planning.
The easiest way to keep abreast of this blog is to become a follower.  You will be notified of all updates as they occur.  To become a follower, just click the “Following” link that usually appears as a bubble near the bottom this web page.
There is a comment section at the bottom of each blog page.  Please provide input and feedback that will help me to improve the quality of this work.
This is original work.  This material is copyrighted by me with reproduction prohibited without prior permission and attribution.  I note and  provide links to supporting documentation for non-original material.
If you would like to discuss any of this content or ask questions, I may be reached at ras2@me.com. I look forward to engaging in productive discussion with anyone that is a practicing interim executive or a decision maker with experience engaging interim executives in healthcare.

What is a blind reference?

Some people naively think that the only reference checking that is done is with the references given by a candidate or a head hunter.   Executives recruiting for talent will peruse your CV looking for places where you might have common acquaintances.  They will also look for places that some of their friends and professional contacts might have insights.  When these links are found which is most of the time for an experienced recruiter or hiring executive, you are about to become the victim of a blind reference.

A ‘blind reference’ is an investigation into your past by a hiring executive that you know nothing about.

I do not put a lot of faith in  references provided by a candidate although I have had candidates give me references that were not very complimentary of them.  If you are going to give a reference, at least have an idea about what they are likely to say about you.  No one that has any sense is going to intentionally give a bad reference on a candidate to a stranger.  I also disregard reference letters.  No one is going to write a letter that states the candidate is bad.  On occasion, I will write a reference letter for someone as a personal favor but I aways counsel them that reference letters in my opinion are a total waste of time.  The only time I pay any attention to a reference letter is if I know the author.

Because of political correctness and the cold legal realities associated with references these days, the best you are going to get from formal references in most cases is that the candidate was hired on one date and departed on another date.  The most you are likely to learn is that the candidate actually did work for the firm you are contacting for the stated period of time.  They will rarely tell you anything more because references are subjective by nature in most cases.  Subjective references that cause a candidate to be ruled out of a search can become a liability for the person that gave the reference.  This is one of the reasons that blind reference checking has grown in my opinion.

If I get a reference call on a candidate being evaluated by someone I do not know, I refer the call to HR where I know what they are going to be told.  Even if the reference call comes from a friend,  I know the candidate and I know them to be bad, usually instead of giving a bad reference, I will refer my friend to HR where they will get the standard, canned response.  The hiring manager gets the message.  If a friend encounters me refusing to give a reference, they always get the message.

The more frequent call that I get is from a decision maker that is checking references that are not on the candidate’s list.  These are the calls that are dangerous for candidates because they are blind to the candidate; hence a blind reference call.  The candidate will never know in most cases they were vetted through a blind source.  This is one of the many reasons why it is so important to keep up your networking and to not burn bridges unnecessarily.  If you left a place under questionable circumstances, you need to have a good explanatory story and you need to be forthcoming and transparent.  Of course a blind reference is not necessarily a bad thing.  Under the right conditions, it can propel you to the front of the line.  I received a blind reference call on a candidate I happened to be considering at the same time.  I told the blind reference caller that they could dispense with their questions because my reference will be very simple, “If you do not hire her, I will.”  I had worked with this candidate before and she is outstanding.  She was going to end up with a gig regardless of how the reference checking worked out in this case.

When I get a blind call from someone I know and trust, they are going to learn the whole story.  The reason is that I know I can call them to have the favor returned at some point in the future.  If the candidate departed under less than ideal circumstances or told a story that I know to not be true, I will give the reference to HR as stated above.  This usually surprises the decision maker that hoped to get something from me.  The fact that I refuse to provide a reference for someone that the decision maker knows I know well usually tells them enough, especially when I put off multiple requests for help.   About the third time I refuse to provide any information, the recruiting executive gets the message.  If you are going to engage in this activity, you have to be absolutely certain that your confidence will be protected.  This is the main reason that I resist giving references to head hunters unless I know them personally because it is hard to be certain your confidentiality will be protected.

When you are looking for a job, who will the hiring decision maker call?  What will they be told by people you used to work around?  Time after time, I have received blind reference calls.  Often, these calls are about someone that has done little if anything to endear themselves to me or to even keep in touch.  People like this generally do not return calls, ask of an acquaintance while offering nothing of value to i.e., they do not engage in networking, they do not accept meetings or referrals, they do not attend or participate in industry related networking or continuing education activities such as ACHE or HFMA.  I wonder what these people expect I am going to say about them?  And of course, all of this is above and beyond anything I might know about their acumen, experience or capabilities.   I would rather not receive these calls in the first place but I do not control who calls me.

I do not know what it is about some people.  In one case, I reached out to an executive that I thought might benefit from my insight about handling executive turnover in his organization.  He humored me then never called me back in spite of the fact that I specifically requested a call regarding a wealth of information that I volunteered.  I never heard from him and I do not expect to hear from him because his failure to take my advice was at least partially responsible for his own firing a couple of months later.  A few weeks ago, I got a blind reference call.  The guy was seeking employment with a consulting firm and I knew the hiring executive very well.  What do you think happened?

This kind of thing does not have to happen to you.  If you are smart, you will get serious about networking and building as many positive relationships as you can.  Many of these relationships come from active participation in associations, alliances and industry peer groups.  You should volunteer your time to give yourself exposure to people that you might need for a job some day and in the process help them develop a positive impression of  you.

There is a saying that there are three kinds of people;  Those that make things happen, those that watch things happen and those that wonder what happened.  You never know when someone is going to make a call to someone that you might not even know; about you – a blind reference.  When that occurs, what will the results of that call be?  If you or someone you know is having difficulty getting a job and their qualifications appear competitive, they may be the victim of blind reference checking which puts them in the category of wondering what happened.

Please feel free to contact me to discuss any questions or observations you might have about these blogs or interim executive services in general.  As the only practicing Interim Executive that has done a dissertation on Interim Executive Services in healthcare in the US, I might have an idea or two that might be valuable to you.  I can also help with career transitions or career planning.

The easiest way to keep abreast of this blog is to become a follower.  You will be notified of all updates as they occur.  To become a follower, just click the “Following” link that usually appears as a bubble near the bottom this web page.

There is a comment section at the bottom of each blog page.  Please provide input and feedback that will help me to improve the quality of this work.

This is original work.  This material is copyrighted by me with reproduction prohibited without prior permission.  I note and  provide links to supporting documentation for non-original material.

If you would like to discuss any of this content or ask questions, I may be reached at ras2@me.com. I look forward to engaging in productive discussion with anyone that is a practicing interim executive or a decision maker with experience engaging interim executives in healthcare.

Just a nurse?

Merry Christmas.  This article is my Christmas gift to my readers, especially nurses whether they read my blog or not.  I thank you for your support and wish all of you the very best for this Christmas season and a safe and prosperous new year.

My wife sent me an article that ran in Fox news about an Australian nurse that fought back on Facebook after having her fill of hearing, “just a nurse.”

One of the saddest aspects of our society in my opinion is the general lack of regard that people have for hospitals.  It is especially demoralizing when community leaders are actively engaged in destroying their community hospital and in the process disrespecting the doctors, nurses, volunteers, leadership and hard-working employees who would do anything for them at any time, no questions asked.  It makes you wonder whether the people who engage in this destruction even care about the capability of the hospital should they or one of their loved ones be stricken with an accident or illness.  I tell audiences regularly that it is not hard to see that  people do not care about the hospital . . . . until they need it.  The same people who persecute voluntary trustees and administrative representatives of their community hospital  expect nothing but the best that medicine has to offer when they or one of their loved ones needs the hospital’s services.  Some of these hypocrites will quietly seek healthcare elsewhere while doing nothing constructive to help their community hosptial.  Sometimes I wonder if the people in the towns where these activities occur realistically believe that they can escape an involuntary visit to their community hospital when they are the victim of an accident, a heart attack or some other unanticipated serious illness?

When the people who engage in activities of this ilk intentionally denigrate their hospital, they are disrespecting all of the employees, physicians and volunteers of the hospital by inference regardless of what they say.  Just like the disgusting, duplicative politicians that commit the young people in the military to life endangering missions then withhold resources and/or engage in open criticism of the military.  This disingenuous behavior is too routine in our society when we witness the spectacle of politicians holding hands and praying together before they send the military overseas only to then undermine and denigrate military leadership and increase the number of body bags coming home by their subsequent lack of support.

I view a hospital like an aircraft carrier.  On a carrier, EVERY person aboard the ship has a job that can be directly traced to the support of a relatively small number of airplanes and their pilots.   The ratio is over 6,000 to about 100.  In a hospital, the primary  reason for every person in the organization is to support the nursing function, more specifically, bedside nurses.  The services delivered in hospitals are for the most part ordered by physicians but they are delivered by nurses.  It is the nurse that is in the building with the patient 24/7/365.  It is the nurse that will place themselves between a patient and any source of danger or threat.  It is the nurse that is the first responder to the patient’s every need.  It is the nurse that carries our their responsibilities with dignity and pride even when they are disparaged or abused by physicians and other authority figures in a hospital.  It is the nurse that is the voice of assurance when a patient is afraid.  It is the nurse that is left to pick up the pieces when a tragedy occurs.  It is the nurse that carries out the final preparations following death.

Nurses control resource utilization and therefore the cost of providing healthcare.  It would seem that executives that are interested in getting more out of nursing would see to it that nurses have what they need to do their job.  In my experience, most of the time, no one has to tell nurses what to do.  They know what to do and they will do it gladly if we will facilitate their efforts and get out of their way.   Those of us in healthcare administration should be ever vigilant to remove barriers, policies and procedures that frustrate the efforts of our nurses to give their patients our collective best.  Nurses influence patient satisfaction and patient outcomes.  One of the greatest sins in society in my opinion is activities of any kind in a hospital that undermine nursing, particularity when these activities are carried out by authority figures.

You do not have to teach or train a nurse to be compassionate or focused on error free work.  In fact nurses operate at far higher levels of performance than the rest of us usually appreciate.  Most of us would not make it very long if we had to perform at the level of our nurses.  Nurses understand the grave consequences of errors in their work.  All too frequently, a nurse that is involved in an all too common human error becomes the second victim of a bad outcome.  That these people can function at all under this stress tells the rest of us how incredible our nurses are.

I have thoroughly enjoyed my relationships with nurses over the years.  The type of people who gravitate to nursing are special.  Most of them are motivated to be in a position to do things to help other people in their time of need.  They do not allow those of us that are ‘bad patients’ to detract from their focus to give us their best.  Their attitude is always positive and uplifting even when we are in the mist of having our worst day(s) and showing it liberally.

Most hospitals recognize their nurses by providing badging that clearly indicates that they are nurses.  One of my personal crusades is to make sure that EVERY nurse in the organization whether they are a bedside nurse or not PROUDLY display their RN identification so that no one will mistake these giants of humanity for any one of the rest of us regardless of their role.

What would our world be without nurses?  What would our world be without the type of people that gravitate to nursing?  What are we doing as leaders that is making life more difficult for our nurses?  Are we creating environments more or less conducive to patient safety?

The next time an opportunity presents itself, do not miss taking the time to thank every nurse you meet for their service to the hospital, its patients and your community.

Please feel free to contact me to discuss any questions or observations you might have about these blogs or interim executive services in general.  As the only practicing Interim Executive that has done a dissertation on Interim Executive Services in healthcare in the US, I might have an idea or two that might be valuable to you.  I can also help with career transitions or career planning.

The easiest way to keep abreast of this blog is to become a follower.  You will be notified of all updates as they occur.  To become a follower, just click the “Following” link that usually appears as a bubble near the bottom this web page.

There is a comment section at the bottom of each blog page.  Please provide input and feedback that will help me to improve the quality of this work.

This is original work.  This material is copyrighted by me with reproduction prohibited without prior permission.  I note and  provide links to supporting documentation for non-original material.

If you would like to discuss any of this content or ask questions, I may be reached at ras2@me.com. I look forward to engaging in productive discussion with anyone that is a practicing interim executive or a decision maker with experience engaging interim executives in healthcare.

What is the value proposition of an Interim Executive?

Interim Executive Services as defined in my ‘About‘ page is not as common in the US as it is in Europe.  On the continent, in order to practice as an interim executive, a person needs to have a certification similar to a CPA in the US.  In the US, it is still the wild west when it comes to interim executives.  A few years back, a private enterprise in NC attempted to establish a credential for interim executives but the effort failed so now it is a buyer beware market.  There are firms providing interim services but in my experience these firms do very little in terms of either training or providing oversight for their interims.  The interims are placed and they are usually on their own from that point.  This raises the question of the value proposition of an interim executive because the proposed pricing is usually higher than the hourly rate for the employee being replaced.

In my experience dealing with buyers of interim services, the first and often most heavily weighed consideration is the cost of the interim resource.  The less sophisticated the decision maker, the more likely that they will be motivated primarily if not exclusively by cost.  This is because they do not get or choose to ignore the value proposition.  This has happened to me time after time.  Each time, I held my ground and demanded a fair premium for my services.  In each case, I told my client that if they did not find value in my services, they could terminate me without cause or notice.  Once they had a chance to experience what a sophisticated interim executive could provide, the cost issue was not raised again.  A decision maker that seizes an opportunity to buy interim services at a small or no premium should be worried about what they will be getting for their money.

I am aware of interim firms that prey on executives in transition that are desperate for income.  Some of these interims will take any job at any price.  The interim firm then sells their services based on price alone and is successful getting a markup of 30% to 50% while providing a price sensitive decision maker just what they paid for.

What would rationalize a premium for a sophisticated interim executive?  There are many considerations that a decision maker should contemplate in addition or in lieu of rate.  I am making repetitive use of the adjective ‘sophisticated’ when referring to interim executives.  There are differences in the sophistication of interim executives and the decision makers that engage them.  These differences are discussed in an earlier article.

The criteria below while useful in understanding the value proposition of a sophisticated interim executive may be equally if not more valuable in evaluating potential interim resources for fit in your organization.

I would advise against hiring the first interim you see unless you have a recommendation from a source that you highly trust.  When I worked with Tatum, they made it a habit to present at least two resources on each project so that the decision maker would have the ability to see more than one alternative and make their own choice instead of letting the interim firm sell them on whoever happened to be currently sitting on their bench with nothing better to be doing at the time.

Experience – One thing worth paying a premium for is experience.  The typical interim executive is a late career individual with a lot of experience, usually in a number of organizations.  The depth and breadth of this experience allows them to assimilate quickly an organization and to begin creating value almost immediately.  This is particularly true if the interim has on-point experience, something you should always look for.

In addition to career experience, it is worth paying a premium for an interim executive with multiple interim engagements on their CV.  The approach to a position as an interim is radically different from what one would take as an employee.  It is worth paying a premium for an experienced interim unless you already have another interim in the organization that can serve as a mentor.

Credentials – In addition to being highly experienced, sophisticated interims tend to carry above average credentials.  Things like advanced degrees, CPA certifications, ACHE, HFMA  and/or fellowships.  These credentials may or may not specifically make one person better than another but the probability that a credentialed executive is going to have a higher level of cognitive capability and an innate drive toward personal excellence is a pretty safe bet.  Another consideration is that no one requires executives to seek advanced education and professional credentialing.  In a situation where everything else is equal, I will always favor a credentialed individual because the very fact that they have obtained a credential is proof of their drive to go beyond the minimum required to get by.  In my experience, credentialed executives are always superior for this reason alone.  As most of us that are credentialed know, you do actually learn something in the credentialing process that might come in handy once in a while.

Expertise – Knowing what you are doing should count for something.  I have seen more than one decision maker hire the first resource they could find that had a heart beat only to make the situation infinitely worse when the interim executive failed.  Most decision makers I have met do not know how to supervise or manage an interim executive.  For example, I would argue that most CEOs do not have the ability to manage a CFO from a technical or risk management standpoint.  I discuss this phenomenon in an earlier article.  The risk for the decision maker is that if the interim fails, the decision maker will usually be held accountable.  The interim will go on to the next gig while the decision maker that may not have been considering relocating finds himself hanging paper from home.

MentorshipSophisticated interims are invaluable in the potential they present to mentor rising executives in an organization.  A sophisticated interim executive that knows how to mentor properly can help turn younger leaders into rising stars.  In addition, interim engagements  frequently lead to demand for additional interim resources that were not anticipated at the beginning of an engagement.  In this situation, an interim that has the capability to manage and/or mentor other interims can bring a very high value to an organization.  I have engaged a number of interims while serving as an interim myself.  I can say from experience that I believe I have delivered substantial value by making sure that the other interims were doing what they are supposed to be doing.

Judgment – You have probably heard the one liner that says, “Good judgment comes from experience that we get by exercising bad judgment.”  I would argue that having the ability to bring above average experience and judgment to bear on a problem is worth paying for.  Experienced executives, especially interim executives can be expected to have better judgment than a decision maker might be accustomed to.

Stability – A transition situation is unstable by definition.  My practice has shown me that the only thing you can be certain of in a transitory situation is that you cannot be certain of anything.  Some people have difficulty dealing with unstable, unpredictable situations.  After or arguably before a decision maker initiates a transition, they should be thinking ahead about their next steps and high among them should be an effort to stabilize the situation so that a business interruption or a bad outcome may be avoided.

Morphing deals – Some people need predictability and stability in order to function effectively.  They are unnerved by constantly changing circumstances and seize up.  An experienced interim executive knows that as a project progresses, things will happen and changes will become necessary that were not initially expected.  The project morphs from one set of circumstances to another.  It is worth paying for experience that can not only help stabilize a situation but experience that can adapt to unforeseen challenges.

Easy to sever – I have seen interim engagements fail.  There is no way that I know of  to accurately predict in advance if the interim executive will be what was expected or whether or not they will be effective in your organization.  In the event that the engagement is not working, you should have the ability to have the interim replaced immediately without cause or reason.  I discuss this in my article about contracting.  If the interim deal is not working, it is highly unlikely that it will improve.  I have had to terminate an interim before the end of their second week in an organization.  In the event that something like this occurs, the sooner you act, the less the potential for damage.  The other side of this is that the issue may not be anything worse than a bad fit.  I am happy to be the easiest person in the organization to get rid of but if I am expected to bear this risk, part the premium I receive justifies me taking this risk.

Interim services firms will endeavor to mitigate this risk by asking for minimum engagement time periods.  My advice would be to pay the premium and refuse to accept a minimum term as explained in my contracting article.

Velocity – In my article about contracting, I talk about the importance of velocity as it relates to interim engagements.  Frequently, decision makers procrastinate about making a decision but once they make up their minds, they want the resource TOMORROW.  Providing this kind of flexibility is worth paying a premium for especially if the resource you want has been waiting for you to make a decision.  If you want a resource to sit around waiting for you make a decision and be at you beck and call at any time, you need to be prepared to pay a premium for this luxury.

Rapid acclimation – When I was at Tatum, the firm’s mantra was ‘Velocity.’  The connotation is that the firm focused on rapid response.  What I have learned from the stages of an interim engagement is that once a decision maker decides to bring an interim executive in, they want them tomorrow.  Part of the premium a decision maker pays is to get  an interim executive  to get to their site quickly,   Sophisticated interim executives also know how to assess a situation quickly.  This skill and experience allows them to become productive much faster than would be expected of an employee.  Decision makers tend to vacillate and procrastinate about a decision to bring in interim resources.  They should not be unhappy about paying a premium for a resource that can help them compensate for the time it took to get the interim on their site.

No benefits – An interim deal is simple from the perspective that it usually only involves the professional fee and out of pocket expenses.  Unsophisticated decision makers will compare the salary rate of the departed employee with the billing rate of the interim and conclude that the interim is expensive without taking into consideration that the employee had benefit cost somewhere in the range of 25% of their compensation.  Not having an interim executive on the organization’s benefit plan is clean and can be a cost saving aspect of the engagement.

Living and travel burden – If you don’t think an interim executive deserves a premium, try living in a hotel and traveling every week.  Not only does this create an expense that substantially adds to the cost of an interim engagement, it is very hard on the interim executive.  The longer the engagement lasts, the harder this becomes on the interim.  It is too easy for decision makers to forget the interim executive as they are going home a warm meal and the privilege of going to bed with their spouse while the interim is separated from their family, eating out and going to sleep in a cold bed.  This aspect of interim executive consulting by itself warrants a premium.  I accept that the burden of travel goes with Interim work but I wonder if the price my family and marriage have paid for me to do this work has been worth any amount of money.  I have lost my sensitively about what I ask for my services primarily be causes of the burden that the interim lifestyle places on the consultant.  I discuss this in detail in my article about becoming a an interim executive.

While I could take the position that it is not a problem of mine, I deeply resent the cost associated with being an interim executive.  Travel, food, temporary lodging and other costs associated with an interim executive is a significant proportion of the total cost of an interim resource.  It drives me crazy to pay these costs or incur them on behalf of a client.  This is one of the strongest reasons for making sure that you are getting your money’s worth from any interim you engage.

Hired independently or via a firm – My experience is showing me that there is a growing population of ‘free agent’ interim executives.  Firms that place interims will take somewhere in the range of 30% – 50% of the total professional fee for their overhead and profit.  In addition, because of what I would describe as oppressive government overreach, most if not all firms now require their interims to work on a W-2 instead of a 1099 or K-1.  This can result in the interim losing tax benefit in the best case and paying tax on out-of-pocket expenses in the worst case.  While free agent interims can be harder to find because you have to know how to network to find them, they can be less expensive because they are not taking a hair cut in a direct deal.  In my experience, a free-lance interim is likely to be much better than interims that come from firms for a variety of reasons that are beyond the scope of this article.

Summary – I could go on but I trust that as a decision maker or an interim for that matter, you can see that there is plenty of justification for a premium for interim executive services.  The premiums I have seen run 50% or more over the base salary of the executive being replaced.  If you are a decision maker, you should not be afraid of paying a premium to get superior skills and resources brought to bear quickly on complex or dangerous business problems and or transitions.  Quibbling over rate can slow down the process of getting the right resource and can prevent you from getting the best possible skill in place.  One of the most profound value propositions of an interim executive is their ability to raise the probability that the decision maker that hired them will not also become a victim of the transitions that created the need for the interim in the first place.  In my experience, decision makers routinely discount this aspect of an interim engagement’s value that is in  my opinion one of the strongest reasons for paying a premium for the right interim.

If you are an interim executive, you should not ever sell yourself short.  I took a haircut on a deal that was only supposed to last 3 months to mitigate on behalf of the firm something that I had nothing to do with.  After three months, the firm would not get my rate corrected and the engagement ended up lasting thirteen months.  I will not work with that firm again because they have demonstrated in more than one case involving me that they cannot be trusted.  As an aside, from my perspective in this case, the firm detracted significantly from its value to me while adding insignificantly to the client’s value.  If you have experience as an interim, you know that one certainty is that you are probably going into a situation that will turn out to be significantly different from what was described and invariably more challenging.  You also know that there is a very high probability that you are going to be in the organization much longer than the decision maker assumes at the onset.  In my  experience once you have proven your value, decision makers will take considerably more time getting you out than they took getting you in.  I have helped decision makers over the cost hump by reminding them that hiring me is a no risk proposition.  They can send me packing the day that they decide that the engagement is not working or that I am failing to produce more value than they expected.  I am happy to take this risk as long as I am being appropriately compensated.  I have yet to be sent packing.  In every case, I have remained much longer than initially expected or planned.  Some interim firms prey on unsophisticated executives in transition by buying them at or below what they were receiving as an employee and reselling them at a market consulting rate.  If you allow yourself to be prostituted in this manner it is your own fault.

In closing, I believe there is substantial justification for paying a premium for interim executive services.  I postulate that the time usually lost by decision makers that struggle with the decision to bring an interim in can quickly create costs and/or losses that far exceed any premium.  As I said in an earlier article, if you are a decision maker, make a decision.

Please feel free to contact me to discuss any questions or observations you might have about these blogs or interim executive services in general.  As the only practicing Interim Executive that has done a dissertation on Interim Executive Services in healthcare in the US, I might have an idea or two that might be valuable to you.  I can also help with career transitions or career planning.

The easiest way to keep abreast of this blog is to become a follower.  You will be notified of all updates as they occur.  To become a follower, just click the “Following” link that usually appears as a bubble near the bottom this web page.

This is original work.  This material is copyrighted by me with reproduction prohibited without prior permission.  I note and  provide links to supporting documentation for non-original material.

If you would like to discuss any of this content or ask questions, I may be reached at ras2@me.com. I look forward to engaging in productive discussion with anyone that is a practicing interim executive or a decision maker with experience engaging interim executives in healthcare.

 

 

There is nothing that I can do for you.

 

Responding to my blog article entitled, “Why do CEO’s get fired . . . ” Bill Eikost, a long time aquaintance of mine in a comment raised the following question:

“In one facility, the hospital had contracted with a large consulting practice to come in and do an assessment of the organization.  As I understand it, when they made their presentation, which included some tough decisions be made, the board objected to it not being in the best interest of the organization or the community.  Why have them come in in the first place then?  The CEO supported the idea of the change but was met with resistance from his board. In almost all cases, I would bet the board wins.  As a result, many of the senior leadership left and they brought in or promoted new leadership to continue the course. ”

I have been mocked for having epiphanies.  People tell me they are tired of hearing some of the stories I use to make a point or illustrate a concept.

Recently, I have been dealing with some vexing problems related to matters beyond my control and entrenched, recalcitrant culture.  It was during a personal low point of frustration, depression and demoralization about these matters that I had yet another of my epiphanies.

Heart surgeons regularly carry out miraculous interventions that result in people that would otherwise be dead walking from the hospital under their own power healing of their afflictions.  One of the more difficult aspects of being a cardiovascular surgeon is case selection.  CV surgeons and their practices are continuously evaluated by all sorts of local and national statistics.  One of these statistics is mortality.  What percentage of patients treated by this physician ended up dying?  Talk about a Hobson’s choice!  On one hand, the physician is motivated to do everything within his power to give the patient the best possible chance of survival.  On the other hand, there are times when the probability of a surgical intervention being successful is nominal.  A surgeon that is too aggressive taking high risk cases will have an above average mortality rate and be branded a bad doctor.  Can you imagine what it must be like to look another human being in the eye and tell them, “There is nothing I can do for you.”  The surgeon knows that putting the patient through a procedure would be unlikely to be successful but he also knows that he is in many cases effectively issuing that patient a death sentence.  I could not do this and I have respect for these surgeons that I cannot articulate.  I do not think I could do this and live with myself.  The next time you see one of them, thank them for their service.

Getting back to my epiphany, some of the things needed to ease the stress on the organization were going to require some community leaders and Board members to step up to challenges and take on controversy they did not sign up for.  Sometimes the easiest thing to do is nothing and if this were to occur, I was finished.  I had reached the point where if this was to be the case, there was nothing more I could do for my organization (patient).  In the middle of the night I awoke in a cold sweat when this realization dawned upon me.  Suddenly, I had insight into what it must feel like for a surgeon to tell a patient they cannot be helped.  If the resolve in the organization and the Board to take on the hard work was not there, I was done.  It would make no sense to continue to play along burning up time and resources on a hopeless cause.

All of us have heard the admonition, “Do not go to the doctor unless you intend to do what he tells you to do.”  Compliance in medicine is a huge problem.  If I was at this point, I could easily log some more time but effectively it was over.

I have seen this phenomena before but I did not see it in this light.  I have seen several organizations go through this process.  In one case, an organization that had never had what I would describe as a professional materials manager expressed resolve to recruit one.  An outstanding incumbent was recruited following a long, arduous retained search.  And of course, less than six months into his run as he would say, “the defecation hit the rotary oscillator.”  Seemingly over night, the organization that said it wanted a materials manager changed its mind when the realization of what actually having a materials manager really meant starting dawning.  Sadly, the new executive’s tenure ended up being very short, his career and his family were disrupted and the organization went back to doing things as they had before.  This was the first but certainly not the only time I have seen this happen.

Time for another digression.  About the materials manager referenced above.  His case is fairly typical.  Sometimes the fit is not right but that does not mean the person is bad.  While no one would recommend anyone going though a situation like the one described, the manager emerged from this trauma a better person for the experience, stronger, wiser and with a clearer vision about evaluating opportunities.  He has gone on to have a distinguished career and currently holds one of the largest material management jobs in the entire healthcare industry and thank heavens, the two of us are still on speaking terms.

A lot of people say they want a lot of things until they fully realize what is involved or what the ‘desired’ change implies.  For example, I described what it takes to obtain an advanced role in an organization in a previous blog article.  A lot of people say they want the lifestyle and income that comes with higher level jobs until they find out how long and hard the road is to get there.  Unfortunately, I do not know of any way to assess in advance the point at which resistance will be encountered or how it will be addressed.

In my recent personal case, I have seen support I would not have believed possible come to bear in an effort to achieve the favorable change for the hospital and the community that is there for the taking.  You never know what people are going to do until the chips are down and the hard questions are on the table.

Kevin Rutherford, a trucker, radio commentator, author and producer of a trucking website ends his shows with the admonition to, “Do the hard work and master the journey.”  I like to say that you will never find the walls unless you are willing to push the limits.

Success is not measured by how long you last in an organization.  It is not measured by how  good you are at ‘staying off the radar’ when the organization is seeking to improve itself.  It is not measured in how adept you are at keeping your job.  Success in my opinion is defined by the degree to which you demonstrate selfless leadership to take your area of responsibility to the next level.  I have posed the pertinent questions before.  Are you and your area an example of the best of their type in the industry?  Are you an example of what others should aspire to become?  Are you and your area an example of best practice?  Is your expertise sought out by peers striving to improve themselves?  Do you know what data is used to make these determinations?  Do you compare favorably with all of the statistics available to evaluate your leadership?  Are you taking initiative or are you waiting for someone to come along and tell you what to do?

An honest self-assessment is very difficult but in my experience, no one that was ‘left behind’ should not have seen it coming.

Please feel free to contact me to discuss any questions or observations you might have about these blogs or interim executive services in general.  As the only practicing Interim Executive that has done a dissertation on Interim Executive Services in healthcare in the US, I might have an idea or two that might be valuable to you.  I can also help with career transitions or career planning.
The easiest way to keep abreast of this blog is to become a follower.  You will be notified of all updates as they occur.  To become a follower, just click the “Following” link in the menu bar at the top of this web page.
This is original work.  This material is copyrighted by me with reproduction prohibited without prior permission.  I note and  provide links to supporting documentation for non-original material.

If you would like to discuss any of this content or ask questions, I may be reached at ras2@me.com. I look forward to engaging in productive discussion with anyone that is a practicing interim executive or a decision maker with experience engaging interim executives in healthcare.

 

 

An old epiphany AKA my Barbara Mandrell story

A few years ago, my wife and I had the opportunity to spend the better part of a week in Nashville, TN.  While there, we decided to check out the Fontanel Mansion.  Fontanel was Barbara Mandrell’s ‘cabin in the woods.’  As of this writing, Fontanel is number 4 of 209 things to do in Nashville according to Tripadvisor.  Barbara named Fontanel after her youngest child.  I will leave it to you to look up the meaning of the word and to see if you can see the inspiration.

I highly recommend visiting Fontanel if you are in the area.  It will leave a lasting impression.  Barbara’s ‘cabin’ is some 27,500 square feet in size.  At the time of its construction, it was the largest log structure on earth.  It is still in the top five.  The magnitude and scale of the mansion defy description.  As I said, you need to see it for yourself.  The mansion is so large, the Mandrell family regularly lost their children in the house so everyone had to carry walkie-talkies to stay in touch.  A huge indoor swimming pool, indoor shooting range, 5,500 square foot ‘great room’, arcade, commercial kitchen, lavish finishes and irreplaceable casework and finishes overwhelm the visitor.

At the time I visited Fontanel, I was struggling personally with what I perceived to be a lack of ability to have the degree of favorable transformational influence in the organizations I served as an interim executive.  I knew what needed to happen.  I knew what it looked like when it is right and what it looks like when it is not right.  I was frustrated by  the fact that the organizations just did not seem to be as interested in changing as I expected.  Many of my recommendations either fell on deaf ears or were humored then subsequently ignored.

You can easily spend an entire day at Fontanel.  There is a lot to see and do.  It takes a while to begin to comprehend the magnitude of the mansion.  To me it was as impressive if not more impressive in its own way than the Biltmore house.  Late in the day we had an opportunity to hear Barbara’s daughter Jamie speak.  She stayed with the new owners of Fontanel as an interpreter and her comments brought the place to life.  I was standing with a group of people listening to Jamie talk about her childhood experience at Fontanel.  She was explaining that she had to reach high school age where she started getting out into friends’ homes before she realized that her childhood experience was any different than that of any other child.  She and her brothers assumed that their childhood experience characterized by wealth, maids, butlers, chauffeurs and the like was no different than the childhood experience of other children.

It was at this second that I could have been knocked over with a feather.  I was overwhelmed by a wave of dawning realization that nearly overcame me.  In one second, I got it!  In the blink of an eye, I finally understood the problem I was experiencing.  The reason that I could not get people in the organizations to see my vision for what they and their organization could be was that the environment they were in as dysfunctional as it might be is their sense of normalcy.  They cannot see the possibility of something so much better because their view of the world is characterized by their role in their environment.  They frequently see little if anything that needs to be fixed.  It is normal for me to hear, “Everything here was fine until you showed up and starting changing everything.”

In one organization I served, the Vice President of Finance told me one day that she was there when I came and that she would be there after I was gone.  She went on to explain that she had ‘broken-in and trained’ five CFOs and had survived them all as she would survive me.  We managed to co-exist for a few months primarily because as an interim, I resist  taking personnel actions that will alter someone’s career unless I am forced into a situation where my options have been reduced to one.  In this case, the first thing my successor did was rid himself and the organization of this caustic cancer of an employee.  I have seen multiple examples in organizations that I have served of shock and awe when the degree of dysfunction, sub-optimization and loss were revealed.

The only thing worse than a dysfunctional culture is a toxic culture.  A dysfunctional culture fails to meet the needs of the organization while a toxic culture is more detrimental to the organization because it characterized by active degradation.  There are a number of characterizations of dysfunctional or toxic culture many of which are obvious to independent, disinterested observers while being transparent to the people that are a part of the toxic culture.   These phenomena are more easily recognized to the degree the observer is viewing the situation academically or clinically without personalization of the circumstances or any of the people involved in the issue.  The problem with this is that people rarely change.  In fact, most of us are extremely resistant to change.  The observation of this phenomena over a long time spent in a variety of organizations has led me to the conclusion that achieving a change in culture without changing the cast of characters is generally a fool’s errand.  Ascension Health is the largest not-for-profit healthcare systems in the US.  Ascension is also the largest US Catholic healthcare organization.  Ascension places high value on the worth of individuals and in my experience errs on the side of doing the right thing by people in its employ.  I have seen the focus inspired by this culture in Ascension hospitals lead them to make substantial investments trying to salvage leaders that should have been long gone.  Sadly, more often than not, these efforts fail and the person ends up leaving the organization anyway.

How does this apply to leadership?  Every time an organization is presented with the opportunity to fill a leadership position, it needs to think about the role and function that now needs new leadership.  In the case of senior executive positions, I strongly recommend that an assessment be conducted to document the degree to which the previous incumbent and the function was meeting the needs of the organization.  Some organizations have a stronger bias than others to promote from within.  While I support this organizational value, it can be problematic.  There is no substitute or alternative that I know of for the enriching experience of working in different organizations, cultures and climates.  This experience provides insight and perspective that is un-achievable for persons that have grown up in the organization with most or all of their experience being in that organization.  They have no capacity to see things differently than how they currently exist.  In some cases I have seen, internal candidates have been victimized by poor or weak mentorship or leadership in the organization.

This is not to say that an internal candidate should not be considered.  The internal candidate does have the experience and insight to know the history of the organization and the location of every closet where a skeleton is hung and the site of every grave.  They can be up to speed immediately while it can take an outsider months to come up to their full potential.

The moral of this story is to be cognizant of your culture and the degree to which it might be impeding your ability as a leader to move your area of responsibility forward.  You need to ask yourself the very hard question of the degree to which you might be part of the problem.  This is one reason that continuing professional education is so valuable.  You need to be concentrating on improving your education and skills continuously.  In this process, you will begin to gain clarity as to how you may have been sub-optimizing.  This is also an example of how consultants can be very valuable to your personal survival probability.  Use them for their subject matter expertise but ask them questions and listen to them very carefully.  You have experience in a few organizations.  They have experience in many organizations and are uniquely qualified to help you understand where your organization might be missing opportunities to improve.

Please feel free to contact me to discuss any questions or observations you might have about these blogs or interim executive services in general.  As the only practicing Interim Executive that has done a dissertation on Interim Executive Services in healthcare in the US, I might have an idea or two that might be valuable to you.  I can also help with career transitions or career planning.

The easiest way to keep abreast of this blog is to become a follower.  You will be notified of all updates as they occur.  To become a follower, just click the “Following” link in the menu bar at the top of this web page.
This is original work.  This material is copyrighted by me with reproduction prohibited without prior permission.  I note and  provide links to supporting documentation for non-original material.

If you would like to discuss any of this content or ask questions, I may be reached at ras2@me.com. I look forward to engaging in productive discussion with anyone that is a practicing interim executive or a decision maker with experience engaging interim executives in healthcare.

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How do I get ahead?

A frequent question I get is how do I advance my career?  How do I get ahead in the organization?  This is a question I asked myself a lot earlier in my career.

The first question to ask is what does it mean to you to ‘get ahead?’  Success is not always best measured by career accomplishment.  I have learned that life is full of trade-offs.  If you wish to advance your professional career, you are going to have to pay a price.  The price is measured in short-term sacrifice for longer term goals, moving to where the opportunities are, pursuing advanced education and professional credentialing among others.  These ‘prices’ are higher than many people are willing or able to pay.  The effect is that they get trapped in roles where they can not realize or achieve their full potential.

When I was coming along, I was always looking up and ahead.  I was the first in my family to earn a college degree.  My parents did not understand college but they did recognize that people with college educations did better.  In college I was exposed to people that had achieved much personal and professional success.  I was inspired to replicate what these people had done so that I could enjoy the niceties of life that they had earned.  When I started working, it seemed to me that given the chance, I  could do better than the people ahead of me in the organization.  I set myself to learning what they had done to become qualified for their roles and I started closing the gaps of experience, expertise, knowledge and credentialing.  Before long, I was given consideration and started achieving my goals of reaching advanced roles in healthcare administration.

One of the things that occurred to me along this road is that the key thing organizations select and reward leaders for is cognitive skills.  Decision making in my opinion is one of the most if not the most valuable skills a leader can develop.  The better you are equipped to make decisions, the more responsibility the organization will bestow upon you.  The larger the responsibility, the more substantial the risks and rewards associated with the decisions you are called upon to make.  These risks and rewards are ultimately reflected in the remuneration for which you are eligible.

In my practice as an Interim Executive, I learned that the primary factor differentiating organizations that were doing well from those that ended up with challenges and transitions is less than optimal decision making.  Show me an organization with challenges, operational difficulties and unacceptable financial results and I will show you leadership that has compiled a poor record as a result of questionable decision making.

As I have reflected upon this phenomenon, it has occurred to me that as we progress through our career and through increasingly responsible roles, the nature of our work changes.  This has led to the development of my ‘Model of Career Progression.’

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Early on in our career, the amount of ‘work’ we do is how we are measured.  The work is usually measured in volume and it frequently requires a high level of technical skill but not much cognitive skill.  For example, what field on what page do I access to find certain information?  How many ‘activities’ can I complete in one day?  I once had a senior leader ask me if I had reviewed certain accounting journal entries.  I told him that I did not know what drawer the journal entries were stored in.  I did not know where the journal entry pad was and I could not remember whether the debits went by the door or the window.  What an outrageously stupid question!  I have not reviewed journal entries since I was a Controller over thirty years ago.  I am not paid to review journal entries, I am paid to assure that the organization’s financial statements are timely, materially accurate and that they fairly state the position and operating results of the organization.  Can you see the difference?

As you advance in an organization, technical skill becomes less important and decision making skill becomes much more important.  At higher levels of responsibility, you become more of a generalist because you are not evaluated based on how much ‘work’ you do.  You are evaluated based on the results of your leadership, particularly as it relates to the outcomes of your decision making regardless of how much time and effort you expend in the process.

In my opinion, the development of cognitive ability is what will launch or limit your ability to advance in an organization.  How do you develop cognitive ability?  All of us are limited at some level by our basic intellect but I do not think that is what constrains most people.  The reason is that people like Earl Nightingale and others have said that most of us rarely use more than 10% of our mental capacity so I am not buying the theory that people are not ‘smart enough’ to do higher level cognitive work.  The way you develop your skills is to invest in yourself by seeking advanced education and professional credentialing in your area of expertise or interest.  Continuous self study helps you to cement your position when given opportunities to function at higher levels.  Experience in multiple situations is also helpful.  You do not necessarily have to leave the organization to gain this experience.  I have counseled numerous young people to seek opportunities in other ares of the organization to learn as much as they can about how the enterprise functions and to see where their areas of greatest interest or gifts lie.

There has never been a time in healthcare that more and better leadership is desparately needed.  There are plenty of opportunities available for those who wish to advance their careers.  All you have to do if you are one of these people is to start investing in yourself.  I can assure you from my own personal experience that investment in yourself is the best investment you will ever make.  I don’t care how cliche the phrase is.  It has served me and a number of other very successful people I know extremely well.

Please feel free to contact me to discuss any questions or observations you might have about these blogs or interim executive services in general.  As the only practicing Interim Executive that has done a dissertation on Interim Executive Services in healthcare in the US, I might have an idea or two that might be valuable to you.  I can also help with career transitions or career planning.
The easiest way to keep abreast of this blog is to become a follower.  You will be notified of all updates as they occur.  To become a follower, just click the “Following” link in the menu bar at the top of this web page.
This is original work.  This material is copyrighted by me with reproduction prohibited without prior permission.  I note and  provide links to supporting documentation for non-original material.

If you would like to discuss any of this content or ask questions, I may be reached at ras2@me.com. I look forward to engaging in productive discussion with anyone that is a practicing interim executive or a decision maker with experience engaging interim executives in healthcare.

 

CFO Radio Interview

On October 17, 2011,  I was interviewed by Lorraine Chilvers on CFO Radio on the topic of Interim Executive Services.  The interview that lasted around 45 minutes is proceeded by some industry news.  During the course of the interview, I am asked about a variety of aspects of Interim Executive Services.  Since Lorraine has insight into the Interim Executive Consulting business, her questions were deeply probing and she did a very good job of engaging me on many of the more important aspects of Interim Engagements and the Interim Executive lifestyle.

Lorraine and I previously served together at Tatum.  Eventually, we went our separate ways.  I went on with my Interim Executive Services career and Lorraine went on to found Delaney Consulting and CFO Radio.

At the time of the interview, I was serving as the Interim Chief Financial Officer of The Central Florida Health Alliance serving Leesburg and The Villages in central Florida.  I recently listened to the interview again and it struck me that the material in the interview is just as current now as it was then.

The interview may be found here.

What should you look for in an interim executive agreement?

Sometimes in the heat of dealing with a crisis, the decision maker is so focused on getting someone into a vacant position that they jump on the first deal they can get done.  In other cases, because of a referral, they take the deal offered at face value.  In my post titled “Types of interim executives and types of clients” I discuss the various types of interim executives and the organizations they serve.  I discuss the importance of matching the skills, experience and sophistication of the interim and their client as a means of achieving maximum value from the engagement.  There are a number of ways to make sure you get the best from your interim engagement.  This process starts with the contract.  Following are some of the considerations that are key to getting the best for your organization from an interim engagement.  The principles I am going to outline here are not only applicable for an interim engagement but they are useful in other contracting situations.

Rate:  Not only is the rate or fee associated with an interim important, the structure is equally important.  Structures can range from monthly to hourly and anything in between. While a monthly rate insulates the hosptial from excessive hours, it can also result in the hosptial paying for time it did not get.  If there is going to be a structure other than hourly, you should request a time sheet from the interim to support the billing.  If you are not going to be watching your interim’s time, you should have someone in your charge performing this function.  I do not advise putting interims on your timekeeping system because there may be an issue down the line regarding their status as an independent contractor.  The fact that you are doing timekeeping for interims on your system makes them look more like employees.  As far as fees are concerned, you should expect to pay between $75 per hour for a high level clerical position like an accountant or analyst to over $300 per hour for a C suite interim.  When you are converting hourly fees to monthly rates, remember there are 4.33 weeks in a month.

While I am on the topic of rate, I should take time to emphasize the importance of getting the most from an interim engagement.  Too many decision makers focus only on the rate while ignoring the potential for an interim to deliver many multiples of their cost.  I will address the reasons that interims are more expensive than employees in a future blog.  Instead of obsessing over the rate, give consideration to what you need to get accomplished and what that would be worth to your organization.  Do not forget to consider the risk you may incur from not having appropriate skill in a critical role during an unstable transitional situation.

Retainer:  Increasingly, I am seeing interim firms ask for a retainer.  They will ask for a lump sum payment representing thirty or more days of fee in advance.  The purpose of a retainer is to insulate the interim firm from credit risk associated with doing busines with you.   Unless you are in or expect to be in a bankruptcy proceeding, this is ridiculous.   All this does is make you the interim firm’s bank.  You are furnishing them an interest free line of credit.  If they are concerned about your ability or willingness to pay, you should question how interested they really are in becoming one of your business partners.  I have worked with an attorney that is of the opinion that a voluntary hospital may not have the legal ability to make a loan to a private enterprise and that is what you are doing when you pre-pay expenses.

Payment terms:  Interim firms will try to get their fees paid in advance.  The typical request is fees in advance and expenses in arrears.  Paying for services advance is almost as bad as providing a retainer.  You do not pay your employees in advance.  You should not be paying your interims in advance.  There is no reason to front expenses for services that have not been delivered.  If the interim has to go for any reason, you will have a settlement to negotiate.  If you find yourself in a dispute, you can always improve your leverage by withholding payment in the event of a breach of your agreement.

Severance / Notice:  This is one of my favorites.  An interim firm will tell you that you have to engage their resource for a minimum of anywhere between 60 and 120 days.  I have a couple of questions for you.  Are you in a right to work state?  Do you generally give non-executive employees or executive employees for that matter severance?  Why would you give an interim a better deal than you give your employees?  Once I had a CEO that had just come into the organization I was serving ask me what my deal was.  I answered that my ‘deal’ was to “serve at his will and pleasure. ” When he incrediously asked what the hell that meant, I told him that I was available to him as long as he saw value in my work and if he reached the point that I was not providing value in his opinion,  I was out of there.  I went on to explain that he would soon learn that he had more than his fair share of problems in this organization and I did not intend to become one of them.  If your interim needs the protection of severance or a notice deal to feel comfortable working in your organization, you have to ask yourself whether you have the right interim.  This is one of the things you pay a premium rate for.  I am comfortable working without a safety net.  I have actually refused time committed contracts once explaining to a bewildered CEO that I did not need that type of commitment; I am OK with being the easiest person in the organization to get rid of.   I am happy to earn my privilege of being in an organization on a day to day basis.  In every case things have worked out and I have ended up staying longer than either of us initially anticipated.  All of this being said, while my contract has a termination without cause provision,  I do ask for a courtesy notice of two weeks or more at the end of the engagement under ‘normal’ conditions.  This is for my convenience only and I would not require my client to observe or pay me pursuant to this clause if things were not going well.  So far, none of this has ever happened to me and if I am a decision maker on an engagement, I will not accept this term in a contract.  Local employees generally do not like interims all that much to start with.  I am not going to be party to giving myself or other interims a better deal than I have or a better deal than the organization’s employees get.

Termination / Replacement:   A transition situation that requires an interim is unstable by definition.  Sometimes the match is not right.  Sometimes the interim does not fulfill your expectations.  You should have an agreement that gives you the ability to request that an interim be replaced or terminated without cause or notice.  An interim producing value will never have a problem.  The more common problem for an interim that is producing value is getting out of the engagement as clients are reluctant to release interims that are creating significant improvement in the organization.  The organization should have the flexibility to terminate an interim arrangement without notice in the event the interim takes inappropriate action or gets involved in something  that would be a termination offense for an employee.

Jurisdiction:  Fortunately, I have never been involved in a disputed interim services contract.  However, I have knowledge of disputes over interim agreements and other types of contracts.  Most vendors will ask for legal venue in their home state.  They typically take the position that this term is not negotiable.  The question you have to ask yourself is that if you end up in a dispute, do you want to bear the cost of going across the country and hiring local counsel to resolve the problem in the vendor’s home town?  If they want to take money out of your town, they should be prepared to settle any dispute in your town.  I have not seen a vendor refuse local jurisdiction if the alternative is that they do not get the business.

Contact structure:   In my opinion, the most efficient way to structure an interim agreement is through a master contract / statement of work structure (SOW).  The master contract sets out the entire relationship except for the particulars about the interim resource(s).  Then SOWs are added or deleted from the master agreement as engagements occur during the course of the business relationship.  The concept is to make the engagement of interims through the same firm more efficient, especially if your organization has a rigorous review of contracts and documents.  One thing I have learned is that even if there is no intent to add interims at the beginning of an engagement, as a transition progresses, more skill often becomes necessary.  Adding a single page SOW to a master agreement is an easy way to facilitate getting additional resources on the job quickly and efficiently.

There is a potential problem with SOWs.  I encountered a situation with a firm I previously trusted that was trying to change the terms of their master agreement via a SOW.  This was going to create a situation where different interims from the same firm were going to have different engagement terms.  They introduced terms into a SOW that were different from the master agreement that were totally unrelated to the specific interim resource I needed.  To make matters worse, they threatened to cancel the interim’s travel plans if the SOW was not executed before the interim’s imminently scheduled airport departure.  For the first time in my career, I found myself negotiating an agreement under duress on a Sunday morning with a hostile firm that was trying to change the deal mid-course via the SOW.  Of course, all of this was blamed on bureaucrats in their nameless, faceless legal department.  I demanded and I am still waiting for the decision maker responsible for this fiasco to meet with me face to face to explain why this firm engaged in this activity and what they expected to gain.  Needless to say, I will not say that I will not use this firm again but I will exhaust all other alternatives before I ever use or recommend this disingenuous enterprise in the future.  The volume of my use of interims from this firm has declined significantly and will eventually reach zero.  There was nothing illegal about this.  However, a business partner that endeavors to change a deal without proactively telling you what they want to accomplish and why is not your friend. 

Exclusive agreement:  I have seen interim firms ask for exclusive arrangements.  There is potential synergy and possibly a small pricing advantage to using one firm for as many interim needs as possible.  That being said, it makes no sense for a decision maker to limit their options to only one firm when they may have widely varying needs.  For example, I have learned in the school of hard knocks that there are interim consulting firms and executive recruitment firms that specialize in one area or another; materials management for example.  Until I brought the resources of a ‘specialty’ firm to bear on a specific need, we were going nowhere in getting a resource into a key position.  If you enter an exclusive agreement and the firm you are using cannot fill your needs, then what?  Do not limit your options voluntarily .  .  .  ever.

Time period of an engagement:  Most interim agreements cover a defined period of time.  I have seen them as short as a month and as long as a year.  To me, the term of the agreement is not an issue if it can be extended or terminated on short notice without cause.  For example, you should be able to terminate a one year agreement upon reasonable notice if you find a permanent resource.

Standard terms and conditions:  As they say, the big words giveth, the small ones taketh away.  Most organizations have standard terms they require in every agreement.  Make sure all of your terms are in the agreement as you wish them.  Business partners will tell you that their contract is non-negotiable or that no one has ever asked them to make a change.  My advice is if you cannot get what you want in an agreement (as long as it is reasonable) move on.  Do not sign an agreement you have not read.  Do not sign an agreement that you do not understand every word, phrase and clause.  Do not sign an agreement that contains anything you do not like.  Just because the vendor is telling you that everyone else has signed the agreement or that it is their ‘standard’ contract, you should demand your right to get the agreement in a suitable form.  If the vendor will not accommodate this, tell them thanks and move on.

I should make a point here about contract language.  I have been reminded by a highly respected attorney mentor that if you find yourself in a court room arguing about the initial intent of the parties, your dispute may be settled by a jury of high school drop-outs.  If you want them to understand what you intended, you have a duty to insure that your contract is written in plain, simple, straight-forward English.

Teaching someone how to do contracting in a single blog is not going to happen.  My purpose in writing this is to sensitize decision makers to some of the considerations and traps in interim service agreements that work more to the advantage of the resource provider than the organization being served.  I find this distasteful but it has become a relatively standard practice.  You do not have to take the deal as offered and you should get terms that are fair not only to your organization but to the faithful employees in your employ that do their part to make things as they should be each and every day.

All of our interests would be served if we could collaborate to develop a contracting template for interim services.  I will be happy to compile and post a resource that contains the best of the suggestions that come from this effort.

Please feel free to contact me to discuss any questions or observations you might have about these blogs or interim executive services in general.  As the only practicing Interim Executive that has done a dissertation on Interim Executive Services in healthcare in the US, I might have an idea or two you would find value in.  I can also help with career transitions or career planning.
The easiest way to keep abreast of this blog is to become a follower.  You will be notified of all updates as they occur.  To become a follower, just click the “Following” link in the menu bar at the top of this web page.
This is original work.  I have not discovered content of this nature in my extensive dissertation research.  This material is copyrighted by me with reproduction prohibited without prior permission.  I always note and  provide links to supporting documentation for non-original material.

If you would like to discuss any of this content or ask questions, I may be reached at ras2@me.com. I look forward to engaging in productive discussion with anyone that is a practicing interim executive or a decision maker with experience engaging interim executives in healthcare.

The stages of an interim executive engagement

I have come to realize in my practice that an interim engagement follows a predictable pattern.  I have seen this happen time and again.  I understand the process that a decision maker goes through during the course of an interim engagement.  A majority of decision makers dealing with transitional situations have little or no experience with interim executives.  I asked about this as a part of my dissertation research.  A small proportion of my respondents (35.7%) reported having experience engaging and managing interim executives.  Another 33.6% of my respondents said they were knowledgeable about interim executive services but had not engaged an interim executive.  Similar to Elisabeth Kübler-Ross‘ five stages of grief, I have observed one organization after another going through a similar process during an executive transition.  The primary difference between organizations and decision makers is their exit point from this process. Some never get around to making a decision or decide to avoid the use of an interim.  In order of their occurrence, here are the stages of an interim engagement that I have experienced.

We do not need an interim – When faced with a transition situation, organizations employ a variety of strategies.  Some use internal resources, some leave the position open and others resort to consultants.  In a future blog, I will address the difference between an interim executive and a consultant.  Organizations will frequently initially resist the fees associated with engaging an interim executive.  They will search for any possible alternative to engaging the interim.  They will spend weeks or months struggling with the interim decision.  I have seen the passage of over six months between the time first contact was made with a decision maker regarding an interim position and the time the engagement actually started.

Acceptance of an interim – All too often, once the decision is made to employ an interim, the client wants the interim TOMORROW!.  Generally, the client communicates their desire to accelerate the interim engagement as a means of managing the cost of the interim engagement.  Sometimes, too much time passes between the time the decision maker meets an acceptable interim and the time they make a decision.  Then they are frustrated when they call to find that the interim they wanted is now engaged.  I once had a potential client get upset with me for ‘putting pressure’ on them to hire me.  All I had done was to tell them that I was being proposed by the firm I represented on multiple jobs and if they wanted me, they needed to make a decision.  In this case, one of the reasons they wanted me was perceived cultural fit.  They wanted someone that would fit into a rural eastern North Carolina culture and I had been a hospital CFO in that area.  Two weeks later, I received a desperate call.  They wanted to know how fast I could get to their site to address what had become a big problem.  I told them that I was literally on my way to Milwaukee.  I had been engaged a few days earlier by one of the other clients that had seen me.  The potential client that had let me ‘get away’ was not happy.  Ultimately, the firm lost the gig because they did not have any other resources that this client liked and I got to spend the winter in Milwaukee instead of eastern NC.  If you are a decision maker, MAKE A DECISION.

 
Recognition of the value proposition – I start my engagements with an assessment.  The purpose of the assessment is to determine the degree to which the function I am filling is or is not meeting the needs of the organization.  During the assessment, it is common to find a number of significant opportunities for improvement.  My experience has been that when a client sees the difference between the interim and what they had before or when they see the magnitude of opportunity revealed by the assessment, the value proposition ‘clicks.’  There is no easy way that I have found to tell a prospective client before an engagement that my experience might be valuable to their organization .  It comes across as self serving.  Once they understand the potential of working with a professional interim that is capable of being transformational in their organization, they want to get as much as possible out of the the engagement as fast as they can because they understand that the potential value is multiples of the cost.  This frequently reduces the client’s focus on getting the engagement over as fast as possible.

 
Employment overtures – Somewhere along the line, usually in the six to nine month period of an engagement, the client decides that the interim is highly desirable and recruitment overtures start.  Sometimes, they come to doubt that a recruitment would result in an equal or better permanent solution. According to my dissertation research, 25% – 40% of the time, the overtures result in employment even if it was not the initial intent of either party.  Tatum called this a ‘conversion.’  The respondents to my dissertation research survey stated that they had converted their interim 35.9% of the time.  If the interim is sophisticated, they will generally resist converting as they see consulting preferable to employment.  The challenge to this part of the process is to get through it without the client becoming concerned that they or their organization are not good enough for the interim.

Diminishing returns – If the interim does not convert, they ultimately begin to experience difficulty in achieving transformational gain in the organization.  Initially, they were a novelty full of energy and fresh ideas.  They are generally very impressive compared to their predecessors.  They are humored by the bureaucracy in the organization and their harvest of low hanging fruit is impressive.  Sooner or later, the resistance of the organization to engage in increasingly difficult change and increasing resistance on the part of the bureaucracy reduces the ability of the interim to produce transformational change.  One day the leadership is evaluating their situation and they conclude that the consultants are not earning their keep and the transition(s) start.  I will discuss the topic of culture and change in organizations in a future blog entry.

Recruitment – During this stage of the process, the interim participates in the recruitment by performing a number of key tasks.  They spearhead the development of a revised job description, they develop a specification for the recruiter, they participate in the interviewing and vetting and ultimately in the selection of the permanent candidate.  I have cast the deciding vote on my replacement more than once.

 
Transition – The transition occurs when the interim is replaced by a full time employee which can be the interim.  If it is not to be the interim, the interim generally assists the organization with the recruitment and on-boarding process.  When the on-boarding process is complete, the interim moves on to their next challenge usually leaving their client organization in much better shape and thankful for their service.

I have personally experienced this progression of an interim engagement time after time. I have also seen every one of my engagements run longer than initially discussed.  Before a client appreciates the value proposition, they are very highly motivated to get the engagement over as fast as possible.  I have been told time and again to not expect more than ninety days, 120 days at the most.   My average engagement is nine months and I am currently twenty months into an engagement  was initially mutually understood to be limited to an assessment only.

The other interesting phenomena that I have seen is that the process can be exited at any stage given circumstances unforeseen initially.  This is one reason that I go the extra mile by making it very easy for my clients to exit an engagement should it become necessary.

One of the factors that lead to engagements dragging on is that the client becomes comfortable with the interim and they allow distractions to degrade their focus on moving the organization beyond the interim engagement.  The next thing they know, the engagement is approaching its first anniversary.

If you are a decision maker considering an interim, my hope is that this material will enable you to better manage the engagement and get the most from it for you and your organization.  If you are considering interim services, and if you are any good, you should expect that your engagements will nearly always run longer than initially discussed with the clients.  Therefore, as an interim, you need to be careful making forward commitments that assume the engagement will be over by a time certain.

This is original work.  I have not seen content of this nature in my extensive dissertation research.  This material is copywrited by me with reproduction prohibited without prior permission.  I always note and  provide links to supporting documentation for non-original material.

Please feel free to contact me to discuss any questions or observations you might have about these blogs or interim executive services in general.  As the only practicing Interim Executive that has done a dissertation on Interim Executive Services in healthcare in the US, I might have an idea or two you would find value in.  I can also help with career transitions or career planning.
The easiest way to keep abreast of this blog is to become a follower.  You will be notified of all updates as they occur.  To become a follower, just click the “Following” link in the menu bar at the top of this web page.

If you would like to discuss any of this content or ask questions, I may be reached at ras2@me.com. I look forward to engaging in productive discussion with anyone that is a practicing interim executive or a decision maker with experience engaging interim executives in healthcare.