I am not a salesman


Abstract: This article looks into the importance of selling in business and the relevance of the development of selling skills to career success regardless of your role in an organization.

Really?  You’re not a salesman or saleswoman or salesperson?  What are you then?  Zig Ziglar and others argue that everyone is in selling whether he or she recognize or acknowledge it or not.  I have come across people that say that they consciously and intentionally do not know anything about selling or that selling is below their station in life.  Some of them have no idea that some of the best-compensated people in society achieve the success they enjoy from being successful in sales.

What is selling anyway?   I would define selling as bringing someone else around to your way of thinking.  The hoped result of the selling process is that the other party will decide to act upon your suggestions and recommendations (closing questions).  Sometimes this results in a sale for value in which goods or services are exchanged. In other cases, you are selling a concept or ideas like a strategy or recommended course of action to a decision maker that must put their reputation and possibly their job on the line by committing to your proposed course of action.

When some people hear the term ‘salesman’ the image that pops up in their mind is the high-pressure wielding scoundrel at the ‘buy here, pay here, Se Habla Español’ used car dealership with the moussed hair, polyester leisure suit, braided leather suspenders, and patent leather platform shoes.   The sales weasel is the offensive stereotype that ‘professionals’ avoid at all costs. However, the argument can be made that the scoundrel has a much easier way of making a living than those of us that make our living by selling ideas, concepts, and strategies into sophisticated organizations.  He is not up against counterparties that in many cases are considerably more experienced, educated, credentialed or intelligent than he is.  More often than not, the reverse is true.

If you would just as soon not be bothered with selling, my suggestion is that you dispense with aspirations of obtaining or staying in a C-Suite role.  What is a C-Suite?  One definition is that it is a marketplace of ideas.  The environment is characterized by continuous, ongoing debate of concepts and strategies to move the organization forward or respond to problems and threats.  If you are not effective in getting your ideas heard, debated and accepted, you might want to start thinking about finding another way to make a living.  If you cannot successfully sell your fair share of ideas in what is usually a very intimidating, competitive and sometimes hostile environment, your perceived value will fall along with the probability of achieving your career ambitions.

What types of selling occur?  Direct selling involves interactions with the intended purpose of an agreement to exchange goods or services for money.  What I will refer to as professional selling is focused on winning in the marketplace of ideas.  In other words, getting decision-makers to take your advice, respond to your counsel or choose a course of action based primarily upon your input. Professional selling is infinitely more difficult because it has a variable that is usually not present in direct selling – politics.  The politics are carried out generally behind the scenes by competitors of yours that could be trusted co-workers that advocate for their ideas behind the scenes or behind your back, without giving you the courtesy or respect of a face-to-face argument.  They use whatever leverage is available to them behind the scenes, under the table, and behind your back to advance their causes, frequently resulting in decisions that do not make rational sense.  Suboptimal results occur because, in the presence of politics, decision making is usually irrational.

For example, I experienced a situation where some physicians were not happy with some of the decisions coming out of the boardroom and the front office.  Do you know how many visits I had from any of the doctors?  The answer is zero!  Instead, they took their grievances directly to members of the board or county commission that humored and engaged them possibly in utter and absolute ignorance of the degree to which this amounted to the active undermining of the leadership team of the organization.  I learned that one board member was accosted in the church vestibule and never made it into the sanctuary to join their family for the service.  Others are caught at their places of work or during unrelated social events.  As we are seeing in our society right now, people that are sufficiently strident about their position will resort to extreme means including violence to have their ideology imposed upon the rest of us.  If you are in a board meeting and something entirely unexpected comes out of left field and derails something that you have put a lot of time and energy into, there is a good chance you are a victim of cowardly, destructive politics.

The stakes of success in a political environment are exponentially higher.  If you are to be successful when you are up against political resistance, your arguments or the effectiveness of your selling must be sufficiently compelling to not only overcome the logical burden of your case but the political forces that may be working against you behind the scenes or maybe more accurately stated, behind your back.  If this is not selling, I don’t know what is.  Most of the time, to one degree or another, your career is potentially on the line when you are selling to your leader or a board of trustees.  Must close selling puts you in an Apollo 13 situation where failure is not an option.  I sold vacuum cleaners in college.  I learned these concepts early on.  In-home vacuum selling can be very intense, high-pressure selling.  That said, selling vacuum cleaners is infinitely more comfortable than surviving in the shark tank that is the C-Suite of most organizations I have experienced.  I guess that’s why good vacuum cleaner salesmen make around $50K and C-Suite roles pay into seven figures.

So, the obvious question is what you should be doing?  My recommendation is that you start dedicating significant time and energy to learning as much as you can about selling.  The quintessential sales trainer is Zig Ziglar. He is one of the best but not the only one.  I would also recommend Harvey Mackay. Both of these guys are retired, but their work is as relevant as ever. Effective selling requires a healthy positive attitude.  There are many excellent motivational speakers. Some of my favorites are Les Brown, Earl Nightingale, Dr. Angela Duckworth, Zig Ziglar, and Ed Foreman.  Don’t overlook some of the incredible ministers that deliver messages of hope and inspiration.  For starters, I recommend Charles Stanley, Johnny Hunt, Robert Schuller, and Joel Osteen.  I have found that the more time I spend listening to these inspiring people, the luckier I become in the marketplace of ideas in a consulting firm, among my compadres, in a hospital C-Suite or down at the local watering hole.

Contact me to discuss any questions or observations you might have about these articles, leadership, transitions or interim services.  I might have an idea or two that might be valuable to you. An observation from my experience is that we need better leadership at every level in organizations. Some of my feedback is coming from people that are demonstrating an interest in advancing their careers, and I am writing content to address those inquiries.

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, click the “Following” bubble that usually appears near the bottom of each web page.

I encourage you to use the comment section at the bottom of each article to provide feedback and stimulate discussion.  I welcome input and feedback that will help me to improve the quality and relevance of this work.

This blog is original work.  I claim copyright of this material with reproduction prohibited without attribution. I note and provide links to supporting documentation for non-original material.  If you choose to link any of my articles, I’d appreciate notification.




48% of CFOs don’t have a succession plan


OR Efficiencies

Though CFOs are usually known for their careful attention to detail, 48 percent of them  have not identified a successor, according to a study in The Wall Street Journal.

Robert Half Management Resources surveyed 1,100 CFOs in  various industries. Of those respondents who have not created a succession plan, nearly two-thirds said they had no plan because they did not intend  to step down soon. They also cited the need to focus on other priorities and the absence of qualified candidates.

Jenna Fisher,  head of the global corporate sector at executive search firm Russell Reynolds Associates, said  the percentage of CFOs with succession plans represents a dramatic improvement from five years ago, when she estimated less than 10 percent of her clients had CFO succession plans.

“The role of CFO has become more salient,” Ms. Fisher said.




We can’t afford to hire you


Abstract:  This article looks further into the value proposition of a sophisticated Interim Executive.

I have become accustomed to being ruled out of a beauty pageant for an Interim Executive consulting position based on rate alone.  In most cases, I am told by the decision maker about this problem after the fact.  It is common for the decision to be made without consulting me or giving me a chance to negotiate.  While I could have been flexible, my flexibility is limited by the opportunity cost of existing or potential competitive opportunities.  When I talked with the decision makers, they were frequently operating from the assumption that the gap was too big to close.  Instead, they lost an opportunity to get a resource with my background and experience while settling for an alternative solely based on cost.  It is clear that these decision makers severely discounted the potential value of engaging a more experienced resource.  Or, I could have simply been beat on price by an equally or better-qualified competitor but I doubt it.  I have seen too many cases of decision makers making what could be a critical decision based on the hourly rate alone.  Lest this come across as bitter, I have not failed to end up with a desirable engagement and I am generally happy with the outcome.  I have learned that as Mick Jagger said, “You can’t always get what you want.  But if you try sometime (sic), you find you get what you need.”  I cannot help but wonder how things are going in the organizations that passed me by.

What would some of the common excuses for a supposedly otherwise intelligent decision maker making a choice solely on rate?

We are in financial distress.  Interim Executive Services typically price on the experience and relevance of a proposed interim to a specific situation.  This is analogous to hiring a lawyer.  One of my friends liked to say that one of the worst things that can happen to you is to end up with the second best attorney in a critical situation.  To gain access to the best and most experienced talent in a law firm, you must be willing to pay the firm’s highest rates.  The reason that older, more experienced law firm partners’ rates are higher is that the market will bear their rates whatever they are because their time and expertise are in very high demand.  For those of us that make a living selling time, you are limited as to how much you can sell.  A firm in financial distress can end up in bankruptcy.  Another bad outcome for a firm in distress is to default on debt obligations that can result in the Board and leadership team losing control of the organization.  Banks and bondholders can and will accelerate the debt and take other actions to preserve their interests.  The pertinent question for the decision maker to make in this situation is what is the best resource available to avoid the undesired outcome regardless of cost because the cost of failure is infinitely higher.  If you think an Interim Executive is expensive, check the rates of bankruptcy attorneys and debtor in possession consultants.

I can get someone else for less money.  Inexperienced or ignorant people do not understand the differences between physicians.  They assume a doctor is a doctor is a doctor.  They do not understand the difference between a pathologist and a proctologist.  This is the kind of logic used by a decision maker that assumes that there is no difference in interim executives and places the first and/or cheapest resource they can find in an effort to get someone, anyone with a heartbeat into a position.  The pertinent question in this situation is what is the cost of failure and how small is this cost as a percentage of the cost of the cheapest resource available vs. a competent, experienced advisor.  I followed an interim CFO in a hospital that had somehow managed to miss a growing over-valuation of accounts receivable that ultimately led to a write-down of A/R in excess of $50 million and a number of executives including the CEO of the place losing their jobs.  Maybe the CEO should have looked at my article on how to avoid getting whacked.  In my experience, hiring decision makers rarely account for the personal career risk they may be taking by thier involvement in bringing an interim aboard.

We can absorb the workload.  This is one of my favorites.  Really?  Are you telling me that the departed executive did so little that a potentially prolonged vacancy of their position will not be missed and there is no risk in not having the role filled?  If this is the case, the decision maker should eliminate the position.  Just because the departed executive may have not been meeting the organization’s needs does not translate to their role not being worth filling with someone that knows what they are doing.  As a matter of fact, putting an experienced interim into a key role say CEO or CFO, might go a long way towards demonstrating to the organization how the role should be filled and carried out.  If you engage a sophisticated interim, there is a very good chance that the permanent executive you hire to ultimately fill the position will not come close to the value-adding potential of an experienced interim executive.  On this point, it is not a good idea nor is it fair to candidates to benchmark them against an experienced interim.  This makes it hard on everyone by unnecessarily delaying the recruiting process in some cases and potentially creating unreasonable expectations for a permanent candidate when there is a successful recruitment.

These are but a few of the excuses I have heard as reasons to rule me out of an Interim gig.  I am sure my readers can contribute others possibly spawning a series of articles on this topic.  One of the key things to remember if you are an interim executive as I said in my article about the value proposition of interim executives is what Zig Ziglar said, ‘You cannot control what someone else is going to do.  All you can control is how you respond.”  Don’t take rejection personally.  Remember, in baseball, a hitting failure rate of 70% or more is considered to be an excellent performance.  Another thing to think about is you never know what you may be saved from.  I can say from experience that I have been fortunate on more than one occasion to not get something I desperately wanted at the time.  You may never know the degree to which fate or divine intervention may be bearing on the outcome of one of your proposals.  If you are a decision maker, you owe it to yourself and those around you whose fate may be tied to yours to undertake the most objective, evidence-based decision-making process you are capable of whether the decision has to do with engaging an interim or any other key decision for that matter.

Contact me to discuss any questions or observations you might have about these articles, leadership, transitions or interim services.  I might have an idea or two that might be valuable to you.  An observation from my experience is that we need better leadership at every level in organizations.  Some of my feedback is coming from people that are demonstrating an interest in advancing their careers, and I am writing content to address those inquiries.

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, click the “Following” bubble that usually appears near the bottom of each web page.

I encourage you to use the comment section at the bottom of each article to provide feedback and stimulate discussion.  I welcome input and feedback that will help me to improve the quality and relevance of this work.

This is an original work.  I claim copyright of this material with reproduction prohibited without attribution.  I note and provide links to supporting documentation for non-original material.  If you choose to link any of my articles, I’d appreciate notification.

If you would like to discuss any of this content, provide private feedback or ask questions, I may be reached at ras2@me.com.




The CFO Confidence Crisis


Few roles are as important as the chief financial officer at most companies, but the CFOs today who are thinking about tomorrow are growing nervous about a key talent issue. They just don’t think anyone else in the company can assume their role.

Indeed, according to a new Korn Ferry survey, 81% of CFOs surveyed say they want to groom the next CFO internally, but they don’t believe that there’s a viable candidate in-house. Currently, about half of new roles are filled internally. 

“The current CFO is the one charged with identifying and developing that talent, and since they know best the skills required to meet what’s coming, they are realizing the internal bench isn’t fully prepared,” says Bryan Proctor, senior client partner and Global Financial Officers practice lead at Korn Ferry.

The lack of confidence is owed in part to CFOs feeling that their firms’ leadership development programs haven’t kept up with the rapidly changing role of CFO. Core functions such as finance and accounting are increasingly being combined under one role, with CFOs citing a lack of resources or skills and career development opportunities as reasons for the merging. Korn Ferry surveyed more than 700 CFOs worldwide, asking them about their own internal talent pipelines. The top two abilities CFOs feel their direct reports need to develop are “leadership skills and executive presence” and “strategic thinking.” 

“The tapestry of skills and experiences CFOs of today and tomorrow need are vastly different than what was needed in the past,” says John Petzold, senior client partner and CXO Optimization lead at Korn Ferry. “The reason subfunctions are merging is because the focus is less on a role or person and more about the capabilities that need to be covered by a set of individuals.”

In essence, the CFO function is being deconstructed for optimization. Leaders are breaking down necessary functions based on their organization’s strategy and identifying people with a combination of those skills and piecing them together to get the right set of talent to execute against that plan. Core financial functions such as taxes, capital allocation, and M&A still need to be done accurately and in compliance with regulations, of course. But experts say the CFO role is becoming more about adapting and deploying talent in the most efficient manner possible. 

“The leadership profile of the future CFO is less about tactical, direct experience, and more about learning agility, adaptability, and big-picture global perspective,” says Proctor. “That kind of nimbleness and ability to pivot isn’t naturally ingrained in the typical CPA.” 


How a sudden departure can affect your job prospects — & what to do about it


Image result for sudden job departures

So far in 2018, approximately 12 hospital and health system executives have suddenly left their roles. While there are myriad reasons for the departures — ranging from being ousted to personal issues — most of them occurred with little or no notice. Whatever the reason, the question remains: How can executives mitigate the potential fallout?

According to Cody Burch, executive vice president at healthcare executive consulting and search firm B.E. Smith, any potential fallout from a sudden departure can be mitigated if executives remain positive and transparent.

“It doesn’t necessarily have to have a negative impact on [a] healthcare executive’s chances of landing another job,” he says.

There are several reasons behind a healthcare executive suddenly stepping down from their role. Common ones include burnout, termination for cause, personal issues and structural changes in the organization, says Mr. Burch. More recent reasons include consolidation, facility closures and demand for new skill sets. An executive may find they are not the right fit for the role anymore as the demands of the role or organization have changed.

An executive who has suddenly left an organization may find they have fewer opportunities in the job market. Mr. Burch says sometimes organizations looking to fill positions may only consider candidates who are currently employed, so executives who have recently left their roles may see a narrower job market than before.

Job seekers with a sudden departure on their resume may have to navigate challenging waters as they look for new opportunities. Here are five key considerations for these executives:

1. Remember honesty is key. Healthcare is very well connected. Healthcare executives and recruiters know each other, often having crossed paths over several years working in the same industry. The best strategy for executives who are looking for a new job after an abrupt departure is to be honest about their past circumstances.

“It is easy for people to find out the real story in an industry like healthcare,” says Mr. Burch. “Communicate about it honestly.”

2. Proactively address the one question every recruiter will ask. Most recruiters will ask the inevitable question, namely some version of, “Why did you leave your previous role?” Mr. Burch suggests healthcare executives expect that question and address it before the recruiter can even ask it. This gives the executive control over the messaging and narrative.

Mr. Burch says executives need to prepare their response to the question carefully. As much as possible:

• Try to disconnect the reason you are no longer in your previous role from the future.
• Communicate what you learned from your previous experience.
• Keep your answer short and focused on the positives.
• Reiterate your qualifications for the current opportunity.
• Explain why you are great fit for the new organization.

3. Stay positive. Although an abrupt departure can be a negative experience, it is important not to lose your positivity and perspective. “I think there is something to be said for either [the executive] or the employer identifying that the fit just isn’t there in the current organization,” says Mr. Burch. “Being able to come to a conclusion and reflect, truly reflect, on why it didn’t work.”

Finding an organization that is a better fit for the executive is a good thing for both the executive and the organization. It is important not to become bitter or emotional. Take the high road regardless of how things ended with the previous employer.

4. Keep networking. Keep your CV up to date and leverage your relationships within the industry, Mr. Burch says. Networking is always critical, but especially so at times of sudden change. Don’t be afraid to ask for help with your CV and partner with a recruiting firm if needed, he adds.

5. Leverage interim leadership. Executives looking to get back into the industry after a sudden departure can look for interim leadership roles. Use these roles to build confidence and demonstrate their value, says Mr. Burch. This will also help connect you to new people within the industry and potentially, new advocates for your leadership expertise.

“If you handle that transition well and get into a good opportunity for your career, the transition no longer matters,” says Mr. Burch. “People aren’t going to look back at that situation unless it happens commonly and frequently [in your career].”

Rise of the Permanent Interim Executive


ZACHARY N. BESHEER, MANAGING DIRECTOR  - Integrated Healthcare Strategies

You have a dilemma: your big, mission-critical project needs full-time, executive-level leadership for the next year. You cannot spare anyone from your current executive team, and no one in the leadership pipeline has the proven skills needed for the job. You don’t want to hire someone new, because you don’t expect to have an opening for the new hire a year from now.

Situations like this occur every day throughout the healthcare industry, and increasingly, hospitals and health systems are turning to interim executives to fill this need. With market demand growing, more and more experienced executives are opting to become permanent interims.

Isn’t permanent interim an oxymoron?

Permanent interim executives are highly-skilled leaders who have a burning desire to make sustainable change, produce quantifiable financial gains, and improve clinical outcomes – all on a temporary, full-time basis.

Executive positions are stressful jobs that demand an exceptional commitment of time and energy. People who hold these positions often dream of finding careers that are equally rewarding, but allow for a different work-life balance. Today, some executives are finding that life as a permanent interim gives them an opportunity to use the skills gained over a career, while exercising more control over when and where they work.

Permanent interims are often retired, or approaching retirement, but not ready to quit working altogether. They are typically over-qualified for the temporary jobs they fill, so they are able to step into a role and make an impact from day one. They are usually self-employed, providing for their own health insurance and pension benefits. Most all reputable interim executives work through firms such as Integrated Healthcare Strategies (Gallagher Integrated), a division of Gallagher Benefit Services, Inc.

In Peter Drucker’s book, Managing in the Next Society, he wrote, “One prediction I’ve heard is that in a few years the people who are not employees of the organization for which they work will greatly exceed the number who are.” Hospitals subcontract for housekeeping services with outside firms who pay the cleaning staff. They contract with physician groups to staff the emergency department. They occasionally hire clerical employees through temp agencies to reduce a billing backlog. These are examples of the phenomenon Drucker was talking about, but they are hardly the only ones.

MBO Partners, a firm offering operating infrastructure for independent workers, reports that in 2015, 2.9 million American workers earned $100,000 or more as full-time interims. Drucker called contract work at the upper level “intellectual capital on demand.” Gallagher Integrated fields many requests for people with executive experience to fill jobs that are not expected to be permanent. These projects are most often related to a key leadership vacancy or a major project that needs additional attention. One frequent request we receive is for an interim chief financial officer. We also field calls for an interim chief nursing officer or nursing director. We place interim chief human resources officers and CEOs in interim positions as well.

Why not consider hiring a recently retired CFO with merger experience as an interim executive to manage the financial side of your next major acquisition? Why not hire a seasoned HR officer as an interim executive to assist your hospital with a major reorganization? Why not look for the best available leader for your project, instead of assigning it to someone who is merely adequate to the task? Doesn’t the availability of well-qualified executives willing work on an interim basis open up the possibility of obtaining better leadership for your organization?

Increasingly, we are living in an “on-demand” world, and our workplaces are reflecting the changes happening in society. Healthcare, with its breathtaking pace of change and exceptional pressures on costs, is an industry where interim executives can make a meaningful impact. Fortunately, there is a ready pool of highly qualified and experienced healthcare executives who have chosen careers as permanent interims.


Is the Rise of Contract Workers Killing Upward Mobility?


Image result for Is the Rise of Contract Workers Killing Upward Mobility?

In the employment firmament, their star is rising. They appear when you need them, go away when you don’t, and there’s always a long line of replacements ready to step in. Contract workers are in wide use today, and it’s easy to see why: The short-term financial gains are simply too alluring to pass up, says Wharton management professor Peter Cappelli.

“Investors hate ‘employment’ because it seems like a fixed cost, even though most companies have no reluctance to get rid of employees, and many keep contractors around as long as their average employee,” says Cappelli, director of Wharton’s Center for Human Resources. “Even though it is typically more expensive per hour to hire contractors, it shows up on different budgets. But it also reflects a general short-term view of strategy: Rather than getting really good at something, which requires investing in competencies, we are going instead to just find new opportunities quickly.”

There are, however, costs to contracting out, and those costs are becoming increasingly hard to ignore. Lack of institutional memory and slowed organizational momentum are obvious deficits to relationships with contract workers. More important, by not investing in the individual, companies are also simply shifting costs.

“I think more than short-termism, this is a classic example of a so-called negative externality,” says Wharton professor of management Claudine D. Gartenberg. “By that I mean, here’s a series of decisions taken by companies — and not just for-profits, but universities, hospitals and across the non-profit sector, as well — that often benefits the organizations financially, but may have serious social consequences that are not borne by the organizations but by workers and society as a whole.”

Moreover, there is reason to believe that just as contract work is not a panacea for workers, it is also not a panacea for companies. “Contract workers have a fundamentally different relationship with the companies they work for than employees do,” says Gartenberg. “Just as companies under-invest in contractors, there are ample studies that suggest that contractors likewise under-invest in the companies. This could definitely hit the bottom line in areas like innovation and customer service.”

If we are in fact in the process of solidifying two distinct classes of workers — one employee in which firms invest, and another that is in a sense more disposable — what are we as a society losing?

“A lot,” says Gartenberg. “This is what the American Dream is built on — upward mobility. Contract work and outsourcing, among other factors, appear to be disrupting that engine, and it is not clear what the best policy response, if any, should be.”

“Investors hate ‘employment’ because it seems like a fixed cost, even though most companies have no reluctance to get rid of employees, and many keep contractors around as long as their average employee.”–Peter Cappelli

A Cost Masquerading as a Savings

While contract workers look good for the bottom line, that’s not the end of it. “It’s great having these people who aren’t part of the headcount, but then you discover all of these hidden costs,” noted Wharton management professor Matthew Bidwell during a recent appearance on the Knowledge@Wharton show on SiriusXM channel 111. (Listen to the full podcast using the player at the top of the page.) “Turnover is higher; often you have to pay them more because they need some premium in order to come to work. And it’s quite disruptive. When contractors move out, you have to move somebody else in and train them up again.”

The introduction of second-class status for some employees also changes the workplace dynamic. “It’s a big deal,” says Bidwell. “Whenever you start designating different groups it creates friction. We worry that contractors can feel threatening to regular employees — there is a sense of, ‘Is my job going to be next to be contracted out?’”

Contracting also appears to have a deleterious effect on one’s career arc. “One big issue is training,” notes Bidwell. “As an employee, your employer may pay to train you and keep you up to date on new technologies. They will also give you a chance to try new kinds of work and learn that way. As a contractor, nobody is paying for you to learn. They only want to hire you to do things that you have already demonstrated you can do elsewhere. That means you have to pay for your own training. You also suffer a Catch-22 when it comes to doing new kinds of work. People won’t hire you to work on different stuff until somebody else has already hired you to do it.”

Bidwell and Wharton doctoral student Tracy Anderson are working on a study that looks at MBA alums who work as contractors, and, in analyzing career trajectories, they find that people who spent time as a contractor seemed to suffer a career penalty later on. “The contractors also said that future employers didn’t take their contracting experience seriously. I think these challenges are particularly severe for contractors in managerial work,” Bidwell said.

Still, contracting out appears to be growing. Exact numbers are elusive because job categories are often only loosely defined. But the percentage of workers engaged in alternative work arrangements of various types — temp agency workers, on-call workers, contract workers, and freelancers — rose from 10% to nearly 16% between February 2005 and late 2015, according to Lawrence F. Katz of Harvard and Alan B. Krueger of Princeton. The percentage of workers hired out through contract companies showed the sharpest increase — from 0.6% in 2005 to 3.1% in 2015.

“A striking implication of these estimates is that all of the net employment growth in the U.S. economy from 2005 to 2015 appears to have occurred in alternative work arrangements,” write Katz and Krueger in “The Rise and Nature of Alternative Work Arrangements in the United States, 1995-2015.”

“Here’s a series of decisions taken by companies … that often benefit the organizations financially, but may have serious social consequences….”–Claudine D. Gartenberg

The consequences are rippling out. Large U.S. firms have played a big role in reducing wage dispersion, therefore helping to mitigate inequality, according to Wharton management professor Adam Cobb and University of Texas at Austin sociology assistant professor Ken-Hou Lin. But that is less the case now, they argue in “Growing Apart: The Changing Firm-Size Wage Premium and Its Inequality Consequences,” published in Organization Science in May, 2017.

Using data from the Current Population Survey and the Survey of Income and Program Participation, Cobb and Lin find that in 1989, although all private-sector workers benefited from a firm-size wage premium, the premium was significantly higher for individuals at the lower end and middle of the wage distribution compared to those at the higher end. But between 1989 and 2014, the average firm-size wage premium declined markedly. Significantly, the decline was exclusive to those at the lower end and middle of the wage distribution — while there was no change for those at the higher end. They conclude that the uneven declines in the premium across the wage spectrum could account for about 20% of rising wage inequality during this period.

“While large firms still compress the wage distribution, they do so to a much lesser degree than in the past. This suggests that although large U.S. firms in our observation period lowered wage inequality, their role as an inequality-mitigating institution has diminished considerably over time,” they write.

Can the Pendulum Ever Swing Back?

In fact, the spread of alternative work arrangements has resulted in “downward pressure on earnings and the shifting of basic risks onto workers and their households,” wrote David Weil, author of The Fissured Workplacein the Huffington Post recently. Weil, who led the Wage and Hour Division of the U.S. Department of Labor during the Obama administration and is now dean and professor at the Heller School of Social Policy and Management at Brandeis University, is arguing for a number of interventions: Creating greater transparency on wages and working conditions, drastically reducing the use of non-compete and mandatory arbitration clauses by employers, creating greater access to skill enhancement, and fostering more varied methods of third-party worker representation (including, but not limited to, unions).

A few trends and forces could slow the use of contract workers, says Gartenberg. “The first is the rise in data analytics within firms. Firms have long suspected the costs of employee disengagement. Gallup estimates $500 billion in lost productivity per year from low employee engagement, and another study shows the bottom-line benefits of having employees feel a strong sense of purpose, which contractors likely do not share,” she notes. “But until a clearer case can be made firm-by-firm, it is hard to justify a change. A range of new technologies for measuring employee productivity, innovativeness, and linking those outcomes to happiness may well help companies make the case to in-source and re-invest in employees.”

“This is what the American Dream is built on — upward mobility. Contract work and outsourcing, among other factors, appear to be disrupting that engine.”–Claudine D. Gartenberg

Another possible impetus for change could come via the decline in publicly traded firms and the increase in institutional common ownership of those that remain. “There are half the number of public firms today as there were in the late 1990s, and investment capital is increasingly concentrated within a few institutional investors,” she says. “Large institutional shareholders are feeling increasing pressure to invest in socially responsible firms. These two trends in corporate ownership may converge to swing the pendulum back towards investing in workers, if enough external pressure is applied and if a sufficient business case can be made.”

Surprisingly, automation may play a role in reversing the trend. If more of the rote work becomes automated, we may be left with work where hard-to-contract softer skills matter more and correspondingly mean higher pay, “at least for a subset of workers,” says Gartenberg. “As an example, I was recently talking with the head of operations of a health care logistics start-up. She said their entire logistics operations were essentially automated, and a real source of advantage was that their call-center representatives were freed up to provide the human face to the company. They had no intentions to outsource or automate that function, as they recognized the value of engaged employees interacting with customers, rather than the mind-numbing IVRs [interactive voice response systems] that we have learned to hate over the past 20 years.”

Bidwell points out that the question of whether the use of contractors continues to grow depends at least partly on legal enforcement. “[For] the previous [presidential] administration, one of their priorities was around companies that were incorrectly classifying independent contractors as employees. Obviously once you are classified as a contractor you are outside of some of the protections — you are under a different tax code, not subject to the minimum wage, all of those sorts of things,” he says. “And contracting shouldn’t be a means for companies to stage an end-run around a bunch of laws that are there because we believe that fundamentally most employers have much more power in the bargaining relationship than employees and we want to even that up a certain amount.” Ideally, we would update the law, Bidwell adds, but “getting anything through Congress these days is not necessarily easy, and so, with a different administration, how fierce they are on who is a contractor versus an employee is going to have at least some impact on this market.”

“It’s great having these people who aren’t part of the headcount, but then you discover all of these hidden costs.”–Matthew Bidwell

As it is, the “legal situation in the U.S. is a light touch,” says Janice Bellace, Wharton professor of legal studies and business ethics. When it comes to companies contracting for workers with another company — a temp agency, for instance — the law has little to say. When a firm engages an individual as independent contractor, there are rules to be followed, and the firm that flouts them risks the government stepping in and determining that they are employees rather than contractors.

But those risks were greater under Barack Obama, when there was a more worker-friendly National Labor Relations Board. In addition, Donald Trump has drastically reduced the enforcement capacity of the Department of Labor by cutting the budget. “Consider that Trump’s first nominee for head of the labor department was a man who headed a fast food chain that had been repeatedly cited for wage/hour violations,” Bellace says.

But what should the policy response be to the increased use of contracting? Gartenberg says that it is important to take note of two factors. First, there is a difference between involuntary temp-workers or workers for contracting agencies, and freelancers/independent contractors. For the latter group, many prefer contract status to full-time employment, and “grouping these people into the overall pool of contract workers overstates the problem,” she says.

Second, alternative work arrangements enable firms to be more competitive overall by lowering costs and providing a better way to respond to market fluctuations. “If, in an alternate world with 100% full-time workers, these firms would be uncompetitive, then these arrangements may end up helping on net, even if some are worse off,” says Gartenberg. “Or, firms may be stuck in a downward spiral where workers end up net worse off, but no single firm can undo this because they cannot bear the costs and remain competitive. These two factors highlight why this isn’t necessarily a cut-and-dry problem with easy answers.”

Wanted: Leaders for tomorrow’s emergency room


A conversation with Bill Haylon, CEO of Leaders For Today

Economic anxieties need not correlate with a high unemployment rate. Take it from business leaders across multiple U.S. industries: Their biggest challenge is not a lack of job openings for thousands of qualified candidates — it’s a lack of candidates for thousands of openings.

HR professionals are used to hearing about skill shortages in manufacturingand other blue-collar work, but perhaps more understated are gaps in the STEM fields.

Careers in nursing and medicine, which often require years of additional, specialized education are hard to fill. Physician assistant openings were one of the most in-demand fields near the end of 2016, according to the American Staffing Association. But hospitals aren’t just struggling to find people to staff operating rooms. They face a much bigger challenge in a lack of leadership skills.

HR Dive/Healthcare Dive spoke with staffing firm Leaders For Today’s CEO Bill Haylon about the root of leadership gaps in healthcare, and how hospital HR departments can confront the problem. Our conversation has been lightly edited for length and clarity.

HR Dive: When hospitals come to a healthcare staffing firm like Leaders For Today, what are they asking for?

Bill Haylon: What we’re really doing is helping them find people who have particular sets of skills. We provide staffing on an interim basis. A hospital or healthcare system comes to us and says, “we really need somebody who can fix and lead our case management department,” “we need somebody who’s got certain technical skills and leadership skills.” We’re not actually training individuals, we’re finding people who fill those slots.

We’re going out and finding people, who they can either hire full time or on an interim basis. We’ll look for, on average, a little more than six spots, and we’ll start from a pool of people that we have that we’ve worked with before.

We’re not really doing training, but training is one of the problems in the healthcare world.

HR Dive: When you look for potential staffers, what kind of skills do they have? What stands out the most to the healthcare systems you work with?

Haylon: There are certain skills that go across all positions, and there are certain skills that are specific to a position because we can hire for. For example, we have a team that focuses on OR people, while others focus on case management, hospital finance, physician management, practice management, etc.

Across the board, what we focus on is, first and foremost, trying to find people who have been steady with or who have stayed with an organization for some period of time and developed within that. In other words, we try and stay away from what we call “jumpers” — people that have a job for a year, two years, and then try and go on their next role.

Unfortunately, that’s counter to what occurs in the industry. People in the hospital industry jump all the time.

We try and get some stability in their job, because we believe they learn more that way [when it comes to] both the technical skills and leadership skills. Of course, you look for the basic things: education, undergraduate work, master’s degree and other certifications.

You’re trying to vet the person along, so a lot of time you’re talking about different situations, different experiences, how they’ve handled them in the past or how they might handle them in the future. It could be a difficult position to deal with, a union situation, a quality situation, a safety situation. And you try to understand what their thought-making process is.

HR Dive: What skills are hardest to come by in the medical world, given that a lot of industries are seeing skills shortages?

Haylon: There’s an enormous shortage of talent within the hospital industry in all key levels. It was going on before Obamacare, and now with Obamacare and more people being covered, each organization is seeing a big uptick in the number of patients they see. It’s really gotten to be a very critical moment.

The most difficult job category is the O.R., the second hardest is case management and the third hardest is physician practice management.

From a skill set perspective, it’s leadership. Most of those in leadership positions are people who were nurses or doctors. When you go to school, you do not learn about financial statements, management skills or leadership. You’re learning how to suture, avoid infections and open up rib cages.

You take a person who has been a staff nurse for [a certain number] of years, and they decide they want to go into a leadership role. Because there’s a shortage of people, they are put in those spots well before they’re ready. They don’t have any training; hospitals do not train people for career development or leadership, and so you’re just kind of winging it. You get people who are very quickly over their head in their positions.

HR Dive: What can hospitals change about the way they operate to help develop those skills, or is that simply not possible given their bandwidth?

Haylon: They make it harder than it is. The reality is that hospitals consolidate, so they’re parts of bigger systems. You have a director in the O.R. who could be managing 440 people. That’s a lot of people. This was the case for one hospital we worked with, and the person running that OR had been a staff nurse and morphed to this role. But her [previous] role had been running a small hospital where she had 30 people, and now she’s up to 440 people, and it’s over her head.

So the reality is that they need to start thinking about different skill sets, and the obvious one is an MBA. When you’re the director of a 440-person O.R., you’re not seeing patients anymore. You’re doing hiring and scheduling. You’re developing quality programs and safety programs. You’re trying to get the surgeons on board. You’re never seeing a patient; that’s a different set of skills.

You don’t need to be clinical, you need to be a manager and a leader. It could be an MBA, it could be a master’s in health. But you need more than clinical training.

So what hospitals do [by recruiting for a certain skillset] is totally reactive as opposed to being proactive and developing people.

HR Dive: Do you see a shift in terms of the skills that physicians and other professionals are being taught in school?

Haylon: You’re being taught technical skills, clinical skills, whatever your specialty is. You go to medical school, do your residency, maybe followed by a fellowship, and it’s all technical skills. Physicians [are also] getting way more specialized than they used to be.

Typically the people who have jobs [in healthcare leadership] have gone and gotten additional training and education on their own.

Physicians and nurses are not trained in school to run big organizations. Plus, they’re doing research, and they’ve got to handle anybody that comes into the OR and the ER. It’s hard enough to get training for it, and it’s beyond belief if you don’t have training.

HR Dive: What else should hospital systems be mindful of when looking for leadership in the medical workforce?

Haylon: When you look at survey data from across the hospital industry, you see that people are staying in positions for incredibly short periods of time. Forty percent of people right now in key positions in hospitals have been in their position two years or less. Another 40% expect to leave in the next two years. What happens is that hospitals have a hole, and they need better leaders, so they poach from somebody else.

So the director of a surgical department will be a manager at a small hospital, then become a manager at a bigger hospital, then a manager at a bigger hospital, then a director at a small hospital, then a director at a bigger hospital, and finally a director at a bigger hospital. They just keep poaching from each other.

The problem is it’s the same people who are circling through. The people you’re hiring never had the time to put in place good, quality programs, [including] safety programs and productivity programs, because they’re not there long enough. They can’t make it stick in just two years; these are very complicated things.

And so that’s the result of what you’re talking about. The lack of training and development shows itself in this poaching and job hopping in the hospital world. It is like no industry you have ever seen before.

In other industries, an enormous amount of resources are put into training, so people stay in those industries and move up. You take up greater responsibilities, but they invest a lot in you as a developing person. The hospitals invest almost nothing. It’s up to the individual to go and figure it out on your own. Get your MBA, take this class, get a certification from the hospital association. But you’re not developing your own people.

Other organizations develop their own people because they want to be the best at what they do — they want to differentiate themselves. The only way they can do that is to develop their own people. Because hospitals don’t do that, there really is no differentiation, and hence, they struggle.

So this lack of training and the lack of development ends up creating an industry where everybody knows they’re going to jump all the time. You’ve got hospitals that have hired their sixth CEO in seven years. So the question is: If you’re a patient and you have knowledge of this, would you want to go to that hospital?

If you have that sort of instability at the top spot, then it’s going to trickle all the way down. Healthcare is complicated; it takes a while to figure out orders in place that are going to work. If they have quality problems, or safety problems, you can’t fix them that quickly. You’ve got to have someone who understands the lay of the land and can make a difference.

Hiring an Interim CFO


Image result for interim leadership

Hospitals are seeing increasing amounts of management turnover, especially in the C-Suite. Skilled and experienced healthcare executives are in short supply mostly due to an industry-wide talent drain, lack of mentoring, and minimal succession planning.

Realistically, filling executive positions takes time, even with the assistance of search firms. Meanwhile, management voids can be damaging: communications suffer, initiatives lose pace, and disruptions occur. Even during a brief transition, some organizations cannot afford vacant leadership positions.

Is interim management a viable option to the risk of absent leaders? Is it better to hire quickly to avoid a vacant role? Many organizations consider interim management solutions as a transitional step to permanent replacement of vacant positions, often in conjunction with the use of a search firm. Others may see the talent and skills within and be able to move quickly. Still, others may hire hastily and lose valuable time in the long run to identify the best candidate.

What tact should your organization take when leadership vacancies occur?


When openings occur in the senior leadership structure, interim management offers advantages over traditional alternatives.

1. Prevents work overloads. Spreading assignments among others causes work overloads. Temporary assignments add extra responsibilities to an incumbent’s already “full plate,” which can lead to work overload and compromised performance. However, a capable interim executive can devote full time and attention to the responsibilities of the vacant management role. A temporary appointment is a welcomed contrast to assigning extra responsibilities to incumbents when a resignation occurs.

2. Adds objectivity. A new set of eyes is beneficial to organizations in transition. Interim leaders usually are less affected by the internal politics of an organization, especially those related to a promotion or a permanent placement into the vacant role. By removing the “vested interest” from the leadership paradigm, the interim executive holds a unique perspective often unavailable to others within the organization. Simply, the temporary status allows the interim position-holder to make decisions unencumbered by career-driven aspirations.

3. Enthusiasm generates optimism. Seasoned healthcare leaders enjoy serving as interim executives and they bring their gratification to the assignment. Their extensive experience and relevant knowledge enables the interim manager to serve as a short- or medium-term replacement for a vacant position as well as a valuable consultant. The organization benefits from the interim’s experience and ability to address the ongoing challenges. When a national search to fill the position is concurrent with an interim assignment, the interim leader and the search consultant can work together to identify a candidate with the right cultural fit. Nuances unique to the operation, culture, and strategic initiatives otherwise unnoted are minimized as the two executives work in tandem.


An interim management solution may not be the best option for every organization or with every vacancy. Quickly hiring and filling the position may be more expedient, especially if an internal candidate with the necessary skill set and personal attributes to succeed is available. Interim solutions may convey misconceptions among the senior managers.

1. Delay may cause unrest. Concerns about a delay should not lead to rushing to a decision or hurriedly identifying an individual to fill the vacated position. Other leaders and managers throughout the healthcare organization may become disillusioned when a vacancy is filled hastily with an internal interim solution.

2. Management perceived as indecisive. By engaging in a temporary solution, senior management may be perceived as indecisive and willing to “float along” for a period while the entity secures the right person with particular skills.


If you decide to engage an interim executive, follow proven guidelines to achieve success and to provide your organization with a value-added service beyond supplying a temporary workforce.

1. Use a reputable and qualified placement firm. Engage a reputable executive search firm to identify and vet candidates before placement. Using qualified professionals to fill interim assignments allows you to off-load the time-consuming, and often expensive, recruitment and screening process. Some firms have both a capable short-term bench and the capacity to conduct the search for the permanent placement. As a subject matter expert, the interim executive can collaborate with the search professional to produce the desired results.

2. Inform candidates of expectations. The candidates should be aware of the expectations that both the hiring organization and the placement firm will have for them. The acting executive needs to understand that their primary focus and allegiance is to the assigned organization. He or she should consider the provisional assignment as a full-time role and not just act as a placeholder. This ownership of the job responsibilities at hand will be a critical success factor for the interim executive. The placement firm should provide oversight to ensure the interim executive approaches the work in this manner, focusing on results. Other leaders within the organization must not perceive the interim as temporary, rather a part of their team.

3. Engage a multi-service search firm. The organization may be well-served by using executive search companies that have the bench strength to fill both short-term and permanent vacancies, as well as the resources to evaluate and even train interim executives in the leadership skills necessary to their new roles. Executive coaching of this type can be especially valuable with physician executives who may lack the management training and experience to succeed in their new non-clinical areas of responsibility.

4. Focus on alignment and avoid conflicts of interest. The organization and the placement firm should be transparent and focused on alignment to assure that the interim executive succeeds. They should identify any potential conflicts of interest and make all efforts to resolve these without involving the interim executive. The executive should be able to commit his or her full loyalty and attention to the hiring organization. He or she should not be in a position of having to choose between fidelity to the interim employer or their direct employer, i.e., the placement firm.

5. Compensate fairly. Executive search firms that know the market rate for high-level managers in healthcare organizations are best suited to handle interim placements. An acting role may demand a premium payment for travel expenses, dislocation of the candidate from his or her family, relocation to a geographically isolated facility or overseas location, and placement into an often chaotic and dysfunctional environment. However, the fees for the interim manager should be valued fairly, not exceeding the boundaries of fair-market-value or commercial reasonableness. This test is especially important when hiring physician executives into these roles, as Stark and anti-kickback laws may apply, especially if the physician continues to practice clinically.


In 2014, a large multi-specialty healthcare system engaged Coker Group to assist with the interim management of their Chief Financial Officer position. The assignment also included conducting a national search for filling the position permanently. Coker vetted several candidates and then agreed to place into the role a full-time Coker employee with extensive experience as a CFO and CEO of several healthcare organizations.

The interim CFO assignment was filled within a week of the discussions. The acting executive immediately faced several issues: declining revenues in several important service lines, and languishing growth and business development initiatives in critical service areas (cardiac services and orthopedics).

Over the next four months, the interim CFO was able to advance many of the stalled initiatives. By performing successfully as CFO, he was asked to assume the role of interim CEO for the system’s flagship hospital, upon the resignation of its CEO. Now, with the CFO position vacant, Coker provided another experienced interim candidate as CFO, again within a week.

Utilizing the skill set from many previous CFO and CEO assignments, the interim candidates quickly aligned with other members of the health system’s senior management team. They expeditiously identified and prioritized opportunities to align costs, increase reimbursement, challenge charge master assumptions, and analyze service line margin contributions. This engagement provided an example of collaboration to the other C-Suite members, as previously they had not worked with their peers and subordinates, creating a silo mentality regarding routine tasks and operational responsibilities.

This case denotes how interim executives can enter into an organization and guide it successfully through uncertain times. It also demonstrates how the right interim leader can take ownership of an acting role and consider it his or her full-time position. The successful leader is versatile and can work at many positions, often assuming greater responsibilities. Ultimately, the CFO and CEO positions were filled permanently as a result of the executive search, and the organization lost no momentum during its conduct.


Immediate replacement versus interim management is a consideration for every board and executive team that must fill a vacancy in its executive positions, with advantages and disadvantages for both options. Each vacancy in healthcare leadership offers a unique challenge. Consider the options, reflect on the personalities of the existing executive management, the political climate of the organization, and the skills and expertise needed before making a decision.