Leadership Skills and Organizational Effectiveness
Are there basic leadership skills that are needed regardless of who you are or what your organization does? Zenger and Folkman were prompted to ask this question after being asked to review a leadership development program developed by one of their clients. They took a straightforward approach to the question by asking 332,860 persons what skills had the greatest impact on success in the position they currently held. Each respondent was asked to choose four options from a list of 16 provided by the authors. They then analyzed the results by the level the person occupied in his or her organization: supervisor, middle manager, senior manager, or top executive. While the rank order of skills did vary some, seven skills were listed much more often, regardless of one’s position in an organization.
So what were they? “Inspires and motivates others” (38%), “displays high integrity and honesty” (37%), “solves problems and analyzes issues” (37%), “drives for results” (36%) and “communicates powerfully and prolifically” (35%) were the top five followed by “collaborates and promotes teamwork” (33%) and “builds relationships” (30%) rounded out the group. The authors do not know, of course, how each respondent interpreted these descriptions, but the large number of answers gives the study its power. While all leadership skills are “personal,” two of the top five attributes directly reflect how the leader is personally perceived by the follower—inspiration and integrity.
What makes a leader inspirational? Could it be reduced to a checklist and be part of a leadership development course? The other highly rated personal skill was “displays high integrity and honesty.” This suggests what we mean the inspirational leader is one who holds him or herself, as well as those around him, to a higher ideal than just being successful. Perhaps these skills really mean “the ability to get others to follow without too much grumbling.” But “champions change” (16%) was not cited as often as a needed skill. Maybe no one wants to be seen as a “change agent,” given the negative connotations. But leadership could be defined as getting people to do something they were not already planning to do. Lest this become too metaphysical, let me state the challenge thusly: leadership is inevitably about change, but organizations and people resist change.
My local school board hired a new superintendent a couple of years ago with a directive to improve student performance on standardized metrics and to assist the board develop a plan to reduce the gap between needs and resources. Recently, the board voted 5-4 to extend her contract for one year. Some of those opposed to an extension said their vote was motivated by complaints received from school system employees. But since people can be expected to resist change, I wonder what discount rate they applied? I also wonder how they measured her success in getting other people on board with the changes? Is there a measure of non-complaints?
How does this apply to physicians and their organizations? First, the skill sets enumerated are generic—they apply here as well as anywhere else. Second, we, like my school board, are very sensitive to complaints and criticisms, but lack good metrics for success.
I was recently in a conversation where I shared a model of organizational resilience. This model sees resilience as the dynamic interplay of competing forces. Administrators push away from economic failure, staff push away from human failure, and physicians push away from clinical failure. In a resilient system, operations are kept safely away from any of these boundaries, as failure in one will inevitably mean failure of the whole.
At the level of the hospital, we have reasonable metrics for economic failure, although granular understanding a the level of the individual small unit is lacking. Individual unit directors and the HR people have some metrics, such as staff turnover, but again, the data are not very granular. Physicians also have some metrics, but the data are often not specific. While I think the nursing directors and the physicians need to work on developing more specific measures of failure, (skill set number 3) I am not sure that in itself would improve operational results, (skill set number 4), because we have a systematic inability to communicate with each other, (skill set number 5.)
Since we all speak English, why do we have a communication barrier? Consider a single example. Hospital administrators are under significant economic pressure to reduce expenditures and improve revenues. One of their principal tools of analysis is cost accounting. Now I know just enough about cost accounting to be dangerous. But I do know that one of the principles of cost accounting is that expenses have to be linked to a revenue source. As a result, a liter of normal saline, which has an acquisition cost of about $1, may have an accounting cost of $10 on the medical ward, $50 in the emergency room, and $100 in the operating room. Now I made these numbers up, but when we used real numbers in past conversation with doctors, little changed. The numbers made no sense to the doctors, who thought the cost of the liter should be $5 everywhere, allowing for the cost of the bag plus the cost of administering it. Said another way, the realities of captured by cost accounting were invisible to the people responsible for generating them. What we need, then, is a way to translate the insights provided by cost accounting into a form that is meaningful to the clinician.
The situation works in reverse, too. Nursing leaders at our hospital have been expressing increasing concern about staff stress for several years as adjustments have been made to deal with declining revenue per patient. Doctors were aware that they often did not know the person they were interacting with, and had a general sense that staff skill levels were deteriorating, but this concern was always anecdotal. Said another way, staff realities were often invisible to both doctors and to administrators.
In the past six months, we experienced a major surge in demand for services after having had several years of austerity. When the demand did not remit quickly, as it usually did in the past, pressure increased rapidly. Voluntary staff turnover, which had been improving, spiked upward, and efficiency, as measured by length of stay, went down. Steps are being taken to ameliorate the problems, but as one administrator put it to me, “We know when the ox-cart is in the ditch, but we can’t tell before we get there.”
We are in the position of the school board members—we heard complaints from those who trusted us and hoped we would influence management. (Not surprisingly, the hospital’s trustees have also experienced the same pressure.) And like the school board and the superintendent, no one knew how to gauge the amount of the pressure or to determine if it had reached a critical level. Getting the ox-cart out of the ditch is going to take time and effort, but the challenge we face, just like our school board, is to tell when the cart is drifting too far away from the middle of the road. In a dynamic system like a hospital or other healthcare organization, demand will fluctuate. While it is possible to predict a winter surge in influenza-associated hospitalization, it is not possible to predict which month or how intense the demand will be, nor for how long. The ox-cart, in other words, is going to weave back and forth across the center line of the path, but we have to have the ability to pull in back from the ditch.
How do we develop the ability to drive the ox-cart better. First, we have to become more explicit about measures of failure—economic, human, and clinical. In doing so, we must not get too worried about precision. A first approximation of reality is better than what we have now. Second, we need to find institutional ways to bring the tacit knowledge of all three groups administrators, staff, and physicians, to bear on solving problems and defining the goals. Third, we must try to find better ways to communicate what we know in ways that make it more likely that others can react appropriately. If we want doctors to spend less money, we have to find ways to let them know the economic impact of their decisions in ways they can incorporate into their decision making at the bedside. If we want staff to be more effective in delivering standardized care processes, we must become more clear on which routines are critical for accomplishing this goal and what barriers have to be removed to make success more common. And, of course, we have to do all of this with less money and more regulatory requirements every year. Doing all of this is going to require leadership that is inspirational and motivational, displays high integrity, solves and analyzes problems, drives for results, and communicates well and often. Is it any wonder so many healthcare organizations are experiencing difficulties?
15 April 2015
 Zenger J, Folkman J. The Skills Leaders Need at Every Level. 30 July 2014. HBR Blog Network. Accessed 31 July 2014 at http://blogs.hbr.org/2014/07/the-skills-leaders-need-at-every-level/.
 My apologies to the person who coined this definition, as I cannot find where I first encountered it. The closest expression of the idea was attributed to Rosalynn Carter, who said “A leader takes people where they want to go. A great leader takes people where they don’t necessarily want to go, but ought to be.” [Kruse K. 100 Best Quotes on Leadership. 16 October 2012. http://www.forbes.com/sites/kevinkruse/2012/10/16/quotes-on-leadership.html.]
Doctors and hospitals operate with different cultures and unexamined assumptions may cause conflict.
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