Hospitals tied with financial companies for the second-highest number of CEO exits last month, though the figure is down from a year ago, according to a new report.
Executive outplacement firm Challenger, Gray and Christmas found that 11 hospital CEOs left their jobs in October. That number is on par with the financial sector and second only to government and nonprofit companies, which saw 24 CEO exits last month.
However, that's fewer CEO departures than in October of 2016, when 15 hospital chief executives left their jobs. The number of hospital CEO exits this year is also down overall by about 37%, from 126 reported between January and October last year to 92 reported so far this year, according to the data.
CEO departures were down across all industries so far this year, with a total of 971, 6.9% fewer than the same window in 2016, according to the report. John Challenger, CEO of Challenger, Gray and Christmas, said in the report that this shows "signs of strength" in the job market and companies have "good reason to hold on to their current leaders."
Turnover is a problem for hospitals from top to bottom, with organizations on pace to replace close to half of their staff every five years. The looming issue of baby boomer retirements merely exacerbates the problem, as they have skills and experience that hospitals may not replace easily.
Churn in the C-suite can also have ripple effects across a healthcare organization and impact the leadership pipeline, so it's crucial to have a plan in place to tackle turnover. Having a successor waiting in the wings to take over is ideal, but providers can groom potential interim leaders internally, as well.
Five key activities can streamline succession planning:
- Skills identification
- One-on-one monitoring
- Executive coaching
- Formal skills assessment
- Continuity and effective transition