Successful CEOs are experts at navigating the numerous obstacles that can hinder innovation. These barriers include everything from industry players to funding to government regulation, which can sometimes aid (or disadvantage) innovations by rigidly interpreting or tightening rules. For healthcare systems, the stakes have risen even higher. With an effective succession process, they can avoid missing out on high-potential internal candidates and overlooking potential leaders that can drive innovation.
Creating a Culture of Innovation
The CEO of any company, for instance, Sam Lee Prospect Medical, has a wide range of duties and responsibilities, but healthcare executives must foster a culture that prioritizes innovation. This includes determining attitudes, behaviors, and values that embody the company’s mission, modeling those attributes, ensuring staff are rewarded for creativity and innovation, and providing support. Moreover, healthcare systems should create a multiyear CEO succession plan to exploit potential leadership talent. Otherwise, high-potential insiders are likely to look elsewhere for opportunities. Health system leaders know they must enthusiastically pursue innovation to position their organizations for success in the 21st Century world of accountable care. Yet many still struggle to make it happen. The good news is that there are strategies to help them overcome the obstacles they face. One of the most important is unblocking limiting thoughts and encouraging risk-taking.
Investing in Innovation
Health systems face many challenges, including transforming their cultures to embrace innovation, overcoming strong departmental siloes, and balancing costs. CEOs are uniquely positioned to set strategic goals, establish priorities and resources, and relay compliance measures to boards. While a few organizations create dedicated chief innovation officers, most of their management resources are allocated to “keeping the trains running,” according to one study. Most innovation efforts are incremental, such as ad hoc pilot studies and internal technology development. Health systems can improve their odds of success in venture investing by creating a dedicated team with clear lines of authority and streamlined decision-making. Another strategy is to form a fund that can insulate the system from tax and litigation risks, attract specialized expertise and co-investors, and generate an entrepreneurial culture.
Developing a Plan for Innovation
Healthcare CEOs must master a complex juggling act that requires business acumen, healthcare expertise, and forward-thinking. Adding to the challenge is a worldwide pandemic that highlights an ongoing need for innovation. Creating an innovation strategy that supports a healthcare system’s goals can help a leader promote departmental objectives and create the framework for innovation activities. The strategy typically includes a review of a company’s current competitive advantages, technological assets, and external challenges. For a hospital to succeed in innovation, it must be committed to the process and make it a core part of its operations. Some health systems establish innovation interest groups or accelerators that provide resources for internal innovators to develop and launch products and services. However, a successful initiative must have a clear plan for generating tangible value, such as revenue, clinical advancements, or new business models. In addition, it must provide accountability for a project’s success. This can be challenging because for-profit ventures seeking to innovate how hospitals deliver care may face resistance from powerful community-based providers who fear a loss of market share.
Leaning into Innovation
Managing the complex responsibilities of any top-level managerial job is challenging enough, but healthcare CEOs must do so in an industry that’s experiencing seismic shifts. This requires much more managerial, leadership, and communication skills. Today, innovative CEOs are partnering with local government agencies to create programs that bring healthcare services to their communities. They’re using telemedicine to connect with patients in remote areas and leveraging data analytics to improve operational efficiency. They’re also preparing their organizations to innovate by investing in the right people and training them to do so effectively. This includes ensuring that exemplary leadership is in place to manage innovation initiatives. It may also mean providing the space needed for potential innovators to gain experiences that can propel them up through the leadership ranks, such as pilot projects or other assignments that provide specific operational experience or expose them to external stakeholders. Without this space, these high-potential, ambitious leaders are more likely to look for other opportunities to help them achieve their career goals.