The case of missing CEOs in healthcare

The ship is ready to sail but the captain is missing. Such is the fate of hospitals in the healthcare industry. The robust brands in the industry are seen setting new establishments but unable to find CEOs to steer them forward.

HRKatha tried to diagnose the problem of missing CEOs in the healthcare industry, by speaking to CHROs of the top hospitals in the industry.

Skill imbalance is the crux of the problem, which impacts the top leadership roles, such as CEOs and operation heads. The right talent is hard to come by. People who come with medical expertise do not possess management skills and vice versa.

An outsider believes the industry is labour intensive, with the majority being medical employees. The individual is insecure about being able to add value to the organisation from the top.

“There is rampant poaching, as there are only that many people in the pile and everyone targets the same group”

More often, people fail to understand the nuances of the industry and are uncomfortable with the fact that hospitals are operated as business models. Not only is it hard for them to accept that healthcare can be profit motivated, but they are deluded by the values and ethics attached to the nobleness of the medical profession.

There is a very limited talent pool from which to fish CEOs in the industry. “There is rampant poaching, as there are only that many people in the pile and everyone targets the same group,” opines Sriharsha Achar, group CHRO, Apollo Hospitals.

“While hospital may sound similar to hospitality, there is a sea of difference in the two. Customers coming to the latter are happy, while the ones entering the former are usually sad,” Achar continues.

“Healthcare is corporate but not corporatised,” remarks Rajani Tewari, former group HR head, Wochardt Hospitals. She adds, “Head of hospitals continuously need to interact with the government for payments. Someone who has not done this kind of job feels it is very transactional, that is why there are fewer people willing to take on the role of a CEO in the industry.”

“In my four-year tenure as head-HR, whenever I pitched the head of hospital role to people, they would snap back asking why approach them knowing they were not doctors!” expresses Tewari.

“This industry works on references. You may call it poaching, but I like to call it ‘references’. Headhunting is very evident here through referencing. If a doctor is pitching your profile, your chances are higher”

Why do people (non-medicos) not like to come on board? Is it because the healthcare industry deals with ailing people and operates on lives?

Achar answers, “The CEO is interested in the numbers! The number of hip transplants done, the number of cardiac surgeries executed and the number of beds unoccupied.”

“I am an outsider to the healthcare industry but now after six months, I find it a normal conversation. For instance, in a telecom company they will talk about how many sim cards and fibers sold. We talk about the number of health checkups, surgeries and occupancy of beds,” remarks Achar.

Sharing her experience, Tewari says, “People coming from outside the industry have rarely been successful at the top leadership. The industry really tests your threshold as far as patience is concerned. Therefore, it also suffers from quick movements.”

Hospital culture is influenced by medical college ethos. For instance, in a hospital, a doctor may be one level below another doctor, but if he has been a senior in medical college he will demand respect and be addressed as ‘Sir’.

The culture of ego-massaging is embedded in the culture. The first deliverable for the job is ego management and not relationship management, be it a CEO or an HR head.

This is the reason non-medicos refrain from getting into healthcare. They think they will be bullied by the medical fraternity, which is true to an extent!

“This industry works on references. You may call it poaching, but I like to call it ‘references’. Headhunting is very evident here through referencing. If a doctor is pitching your profile, your chances are higher,” opines Tewari.

“Hiring also has to be financially viable because the cost of establishing a hospital is very high. For instance, depending on the city, the cost can be anything between 75 lakh and a crore for a bed. A hundred-bed hospital approximately costs a hundred crore,” opines Achar.

The CEOs deal with human life, and therefore, they charge a premium for that additional responsibility. They certainly don’t come cheap!