Inthefaceofmonumentalchangewithinhealthcare,humanresourcesprofessionalsareunderincreasingpressuretoensureasteadyflowofleadershiptalentwithintheirorganizations.Althoughmanysuchorganizationshavewell-developedtalentmanagementpractices,fewhaveafirmunderstandingofthereturnoninvestmentthesepracticesprovide.

Tobettergaugetherelativesuccessorfailureofstandardtalentmanagementpracticeswithinhealthcare—andtoprovidepracticalrecommendationsforthefuture—Dr.KevinS.Groves,Ph.D.,presidentofGrovesConsultingGroupandassociateprofessorofmanagementatPepperdineUniversity,recentlyconductedacomprehensivesurveyof142seniorHRofficersandotherindustryexecutivesinchargeoftalentmanagementwithintheirorganizations.Witt/KiefferprovidedsupportforGroves’work.

Theorganizationsrepresentedinthesurveyconsistedmostlyofprivate,multi-hospitalhealthsystems,reportedanaverage

netrevenueofmorethan$3.5B,andemployednearly19,000full-timeemployeesonaverage.ThefullresultsofGroves’

surveycanbefoundinacomprehensivereportatwww.grovesconsultinggroup.com1.

SurveyrespondentsratedthedegreetowhichtheirrespectiveorganizationsutilizeTalentManagementSuccessFactors2.

TheSuccessFactors,whichmeasureaseriesoftalentmanagementbestpracticesderivedfrompriorresearch,arelisted

herealongwithfindingsforeachfromGroves’recentstudy:

www.wittkieffer.com

Success Factors in Healthcare Talent Management:What Differentiates High- and Low-Performing OrganizationsAn Executive Summary

Success Factors Findings

Top Management Team Support Four-fifthsofsurveyrespondentsnotedthattheirorganizationsviewtalentmanagementasastrategicpriority.

Performance Management Processes

Mostrespondentsnotedthattheseprocesseswithintheirorganizationsweredeemedobjective,thoughslightlyfewerheldthatemployeesandmanagerssawtheprocessesascredible.

Talent Assessment Practices Mostbelievedthatassessmentpracticesarenon-politicizedandcollaborative;responsesweremixedintermsofwhetherformalassessmentswereusedtopositionemployeesaccordingtoperformanceandleadershippotential.

Leadership Development Culture Amajorityfelttheirdevelopmentculturewasfairandequitableingeneral,thoughfewrespondentsindicatedthiswas“always”thecase.

Pay Practices Theexecutivesreportedarelativelylowdegreeoforganizations’utilizingpaypracticesasaTalentManagementSuccessFactor.

Onboarding Practices TheuseofonboardingpracticeswasthehighestamongallSuccessFactors.

Talent Management: A Connection to Productivity?

Next,thereportstudiedwhetherapositiverelationshipcould

bemeasuredbetweentalentmanagementpracticesand

employeeproductivity.Theresultsindicatedthat,indeed,

therewasacorrelation.

HospitalsystemswithhighSuccessFactorsscoresreportedan

averageemployeeproductivitymetric(netrevenue/FTEs)of

$164,154comparedto$132,685fororganizationswithlow

SuccessFactorsscores.

The$31,469differenceinnetrevenueperFTErepresentsa

nearly24percentincreaseinemployeeproductivity.

HospitalsystemswithhighSuccessFactorsscoresreportedan

averageHCAHPSscore(HospitalConsumerAssessmentof

HealthcareProvidersandSystems)of74percentcomparedto

65percentfororganizationswithlowSuccessFactorsscores.

HospitalsystemswithhighSuccessFactorsscoresobtained

significantlyhigherpatientsatisfactionscoresacrossall

HCAHPSdimensions.

Turnover, Bench Strength through the Lens of Workforce Metrics

Groves’dataalsoestablishedaconnectionbetweengood

talentmanagementandstrongtraditionalworkforce

metrics.HospitalsystemswithhighSuccessFactorsscores

demonstratedsignificantlylowerannualturnoverfornurses

andmanagementcomparedtoorganizationswithlowSuccess

Factorsscores.Thetwo-percentreductioninannualturnover

fornursesrepresentsatotalannualcostsavingsof$2.45M,

Grovesestimates,whilethenearlytwo-percentreductionin

annualmanagementturnoverrepresentsatotalannualcost

savingsof$800,617.

HospitalsystemswithhighSuccessFactorscoreswerealso

significantlylesslikelytosourceexecutivetalentexternally

andwerefarmorelikelytoreportleaderbenchstrengthofat

leasttwo“readynow”candidatesforkeyleadershiproles.

www.wittkieffer.com 2

Turnover Rates

6.83%

5.05%

9.98%

7.91%

0%

2%

4%

6%

8%

10%

12%

Management TurnoverNurse Turnover

Orgs with Low Success Factors ScoresOrgs with High Success Factors Scores

Sourcing External Talent and Benchstrength

0%

10%

20%

30%

40%

50%

60%

70%

80%

14%

53%

69%

43%

Orgs with LowSuccess Factors Scores

Orgs with HighSuccess Factors Scores

Benchstrength of 2 “ready-now”

candidates

Source externalexecutive talent

$0$20,000

$60,000

$100,000

$140,000

$180,000

Orgs withLow Success

Factors Scores

Orgs withHigh Success Factors Scores

Net r

even

ue/F

TEs

$164,154

$132,685

Employee Productivity

The Importance of Diversity

Regardingexecutiveteamdiversity,high-performing

hospitalsystemsreportedsignificantlygreaterwomen

andethnicminoritiesacrossallexecutivepositions

(vice-presidentsandabove)comparedtohospital

organizationswithlowSuccessFactorsscores.

Finally,theaveragenumberofexecutivesearches(4.14)

andassociatedfees($235,000)weresignificantlylower

forhospitalsystemswithhighSuccessFactorsscores

comparedtolow-performingorganizations(13.73and

$1.10M,respectively).

Defining High-Potential Employees

Hospitalsystemsadoptarangeofpoliciesandpractices

toexecutetalentmanagementstrategies.Exactlyhalf

(50percent)oftheorganizationsexplicitlyinformindividualemployeesoftheirstatusas“highpotential.”Mosthospital

systems(52percent)define“highpotential”accordingtoleadershipcapabilitywhileutilizingthefollowingfactorsto

designatehighpotentialemployees:

•Jobperformance(64percent)

•Leadershipcompetencies(63percent)

•Specificworkexperiences(54percent)

Themostcommonleadershipdevelopmentpracticesincludedspecialprojects(59percent)andinternaldevelopment

programs(52percent).Themostcommonmetricsforevaluatingtheefficacyofrespectivetalentmanagementsystems

includedtheinternal/externalhiringratioforleadershiproles(43percent)andthesuccessratesofhigh-potentialsplaced

intonewroles(36percent).

Healthcare Talent Management: Recommendations for Raising the Bar

Thesurveyresultssupportavarietyofprogressiveapproachesfordevelopingatalentmanagementstrategy,amongthem

prioritizingtalentmanagementinvestmentsformaximalgainsinclinical,financialandworkforceoutcomes.Implementing

specifictalentmanagementpoliciesandpracticeswillgreatlybenefithealthcareorganizations,thestudysuggests.Healthcare

organizationsseekingtoleveragetalentmanagementforimprovedorganizationaloutcomesshould:

•AudittheirrespectivetalentmanagementsystemacrosstheSuccessFactorstoidentifycriticalgaps

•Elevatethebusinesscasefortalentmanagementamongtopmanagementteamandboardmemberswithemphasisonclinical,financialandworkforcemetrics

•Accelerateworkforcediversityinitiativesbyincreasingthenumberofwomenandethnicminorityexecutivesthroughtalentassessmentandonboardingpractices

•Developonboardingprogramsforbothexternalhiresandkeyinternalpromotions

•Createcustomizedassessmenttoolsforidentifyinghighpotentialleaders(e.g.,nine-boxmodels,multi-sourceassessments)

www.wittkieffer.com 3

Diversity in High Success Orgs Vs. Low Success Orgs

Orgs with LowSuccess Factors Scores

Orgs with HighSuccess Factors Scores

0%

10%

20%

30%

40%

50%

Ethnic minority executivesWomen executives

45%

27%

34%

6%

•Assessthecomposition,formatandfrequencyoftalentreviewsessions

•Establishtransparencywiththehighpotentialdesignationprocessthroughkeypoliciesandpractices

•Develophighpotentialleadersthroughproject-basedassignmentsdirectlytiedtostrategic,system-wideinitiatives

•Adoptabalancedscorecardapproachtoevaluationmetricsformeasuringtheefficacyofthetalentmanagementsystem

References1Groves,K.(2012).ImpactofTalentManagementPracticesonHospitalClinical,Financial,&WorkforceMetrics:

HealthcareTalentManagementSurvey.IssuedOctober2012.

2Groves,K.(2011).Talentmanagementbestpractices:Howexemplaryhealthcareorganizationscreatevalueina

downeconomy.Health Care Management Review,36(3):227-240.

For more information on this study, contact:

KevinS.Groves,Ph.D.

President,GrovesConsultingGroup

AssociateProfessorofManagement,

GraziadioSchoolofBusinessandManagement

PepperdineUniversity

310/568.5729

kevin.groves@pepperdine.edu

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