In today's dynamic environment, change is the rule! The new look needed to adapt to these changing environmental factors means the old habits must be reassessed by the updated core values. One of the challenges in a multi-doctor hospital is that the administrator and leadership, as in the owners or board of directors, are increasingly faced with issues different from the traditional black or white decisions of a sole practitioner. A multi-player leadership team now is required to integrate the polarity of the doctors and staff with the demands and wants of the changing environment or community. The administrator is constantly restoring balance, because of these polarities, and merging existing policy and precedence, which, sometimes, were established in a previous and now outdated era, with daily operational needs.

We are seeing the affiliated hospital environment getting into other types of businesses as well, including boarding, grooming, physical therapy, alternative medicine, hosting specialist, and internal referrals, just to name a few. Now any type of forward-looking leadership should be able to accept this expansion role, but some don't accept change too well. To increase practice success rates, boards really need to continuously monitor and improve themselves.

See the following terms for clarity.

All leaders must assess how they spend their time, how they can modify their operational structure, what instructions the new members receive, whether there is strategic alignment between the pieces of the system, and similar boundary issues. This all becomes a very important challenge for the multi-leader cultures, and a greater challenge for the administrator. In multi-leader practice cultures, the consensus of the leadership must lead the system, and that infers they must lead. It is not based on where the system has been, but where the system is going. The executive team (coordinators), led by the hospital administrator, is the real key to effective practice operations and nurturing the human resources. If we take a look at a typical practice, we find that there are really very few things that they can control, and if they don't control these, the practice entity is not going to be efficient or effective. The administrator must orchestrate these activities to be effective.

 The first most precious commodity a leadership group possesses is the time it spends together. This is one of the things that make group leadership absolutely fascinating. Please realize that a leadership group does not legally exist unless the group is together and is meeting. The only time a leadership group exists, such as a board, professional staff, or owners, is between raps of the gavel. Individual group members have no policy authority whatsoever.

 Number two is the utilization of time. One of the best ways to control a group's time is to control its agenda. Most groups we work with do not initially control their agendas. Amazingly, when we ask the leadership of an emergency hospital or specialty referral center, those people who control or set the agenda, most of them do not know how to, or even know who, work the system(s). Agendas rule the time utilization, which is why a perpetual list of "tough issues" must be developed, and a "tough issue" leads each meeting agenda. Core values and mission focus must be clear, so the two or three hours a month the leadership group has together can be used to set policy, make decisions, and better define boundaries.

 Many of the practice groups who "go through the motions", rather than implement concepts, put all issues into a "consent agenda", which includes the approval of the minutes, the receipt of the P&L from the CPA, and the decisions that the boards are legally required to make, but aren't that important in the big picture. Most boards will take the most meaningless, boring, censorious nonsense and put it first on their agenda. Then the administrator lumps them all together into one multi-faceted agenda item, sends out the information to the board members ahead of the meeting date, and says, "Read this. If there are no questions, then we will be done with a single consent vote."

 A consulting test we use with established groups who have been using agendas, and I suggest you do this, is to pull out the agenda for today and two from previous meetings a year or two ago. We white-out the dates so they are unreadable. We mix them up and we pass them out to the board. The question is asked, "Can you tell which agenda is for today's meeting?". About sixty percent of the time no one can tell. The agendas are virtually identical.

 If you have an agenda for a meeting for today, and an agenda from two years ago that look the same that means you are dealing with the same issues that you were dealing with two years ago. The use of consent agendas has, therefore, been a detriment to progress.

 In the best of groups, their agendas change regularly. Not just yearly, but they change from meeting to meeting, as different issues ascend or descend in levels of importance, consistent with the identified strategic plan. Good groups control their agenda, bad boards don't. In the best of the best leadership groups, no advanced agenda means that no one attends the "suggested meeting". Without an agenda, it cannot be a "planned meeting".

 Average groups usually save the most important critical issues for last, or they don't appear on the agenda except as "new business". We are very simple people, so we have very simple suggestions: a) identify what the most important critical issues are, and many groups have not even done that, and b) put it first on the agenda.

 One of the key characteristics to look for in a leader is, at any level, does the person understand what the most important issues are on which the leader should be spending time? Does the person review the system's vision to focus on those issues? Does the person have the discipline to put blinders on and use the core values of the group, rather than personal bias? Leaders do not discuss issues that are seductive, those they would like to get into, or those that are situational, since these belong to the operators within the respective zones. Does the leader know how to refer issues that are not on-track with the external strategy of the practice within the community, or the overview of outcome guidance to the coordinators or administrator?

 When a veterinary hospital administrator works with the board, two questions need to be asked: what is the mission and what is the plan? When the second question is broken down, ask "What are the three or four most critical important issues confronting this organization or system in the next couple of years?" Most boards can't answer that last question. They don't know what the critical issues are, so they have no way of organizing their direction or their time to address those issues. Once the administrator has identified what the critical issues are, and put them at the top of the agenda, the board deals with the most critical issues first and the executive team has direction.

 After the manager or administrator structures the agenda, the executive team (coordinators) can structure the information. Many practices are struggling to create good management information systems, but forget to create a good feedback information system to go "up-line" and different from "down-line" needs. Board reports are not warmed-over management information. Don't send a multi-owner or multi-doctor group the routine management reports, zone meeting minutes, or even written task force progress reports. The multi-faceted groups should get information with content relevant to the critical issues, and the format of the information is relevant to the function of the group. Those are items that are big picture, community trend-oriented and future directed.

 The twenty or thirty percent of the meeting time that an oversight group gets to monitor the overall system should be in the framework of graphic indicators, such as charts, which show the indicators within upper and a lower control limits. The members should not have to be financial geniuses. The finance task force, with advice, should develop no more than twelve financial indicators, with upper and lower control limits. When board members see the indicators are within control limits, they don't spend any time on them. See the VCI® Signature Series Monograph Profit Center Management, with CD, which has a monthly program-based budget spread sheet that drives these key indicator charts.

 When the indicators begin approaching the control limits, questions should be expected. Footnotes can offer the explanations. That is how an administrator can get "monitoring the past" down to twenty to thirty percent of a board's time. When an administrator gives the leadership group members the graphical indicator information in advance, it enables the members to begin planning and creating the future.

The administrator must understand both the "why" and "how" of the operational structures needed to support the practice's strategic positioning plan. If we go back to Winston Churchill's comment, "First we create our structures, then they create us," we can see the pitfall almost immediately. If the administrator does not control the operational policies, the coordinator team will become prisoners of them. The most important lynch-pin of an effective leadership system is founded in one question:

Once the leadership makes meaningful decisions and sets robust policies, how does the administrator "make it happen"?"

If the administrator does not control time, as in the sequencing of events, the "tough issue" agenda, the graphic information, and the daily operational structures, it will be very difficult to implement those "meaningful decisions" and "robust policies". Three quick statements about the implementation process:

1.  Our bias is toward streamlining operations, but you can make any structure work. The secret is clear expectations, with crystal clear boundaries, that can be met at least eighty percent of the time. Pride in performance comes when expectations are exceeded, and staff pride is perceived as quality by clients.

2.  Here is a very good diagnostic tool for innovation, and it is also indicative of the team-base of the operational process. What percent of staff suggestions are implemented within forty-eight hours? If your answer is "less than sixty percent", you have an executive challenge. Veterinary hospital administrators, working with a leadership group, need the latitude to make operational decisions, which include significant unilateral spending limits within the budget guidance.

3.  There must be authority vested in the hospital administrator to mediate boundary disputes by facilitated discussion of the involved parties. Unless the professional staff members have a method to resolve their own boundary issues, the leadership group will become "mother" to the children. If the administrator comes to the conclusion that a) there is a problem, and b) it needs to change, there must be a way to address it at the operational level. If the administrator can facilitate changing the environmental distractions, then resolution is possible. If not, it isn't going to happen. The leadership then wants to be involved in "minutia management" and the administrator and coordinators are not needed. When the leadership becomes overloaded with process intervention, it means poor strategic response to opportunities, and a dysfunctional relationship with the executive team (coordinators), as well as decreased operation efficacy and loss of net income.

The final concern for the hospital administrator working within a multi-doctor or multi-owner system is to determine what methods are needed to minimize the difficulties and risk associated with the leadership relationships. Obviously this is a complex matter and has many "personality" and "environmental" variables. However, there are five guidelines for improving the effectiveness and prolonging the tenure of hospital administrators:

1.  Hire the right person for the job. The old habit of promoting from within will seldom work in a rapidly expanding veterinary practice, for two reasons:

a.  The allegiance and breadth of mission experience/knowledge is the software needed to operate, as in promoting from within.

b.  The education and technical management knowledge of leadership and organization behavior is the hardware, as in hiring from outside.
In both cases, very few practice leaders have the training or the time to integrate the hardware and software into a single transition of operational control to the staff. There are many facets of organizational behavior, economics, facility planning, logistics, human resources, strategic planning, and related skills that the average veterinary practice does not develop in their internal managers.
The Certified Veterinary Practice Manager designation from the Veterinary Hospital Managers Association (go to www.vhma.org) is one skill set, and the only real credentialing body for managers inside veterinary medicine. The Masters in Healthcare Administration degree, considered an MBA specifically for healthcare, is another avenue. It allows the degree holder to sit for the boards, where there has been a sixty-plus percent fail rate, and become a Diplomate of the American College of Healthcare Administrators. There are over 30,000 members in ACHE, and less than forty percent have passed boards to be certified in the skill set need for healthcare administration.
These people do not come cheaply. A CVPM deserves at least twenty-five percent more than an home-grown manager, and the Diplomate, ACHE, will start at a salary almost double that of the average "practice manager". In either case, they are worth it!

2.  Actions, procedures, and assignments of responsibility should be consistent. The leadership/governance structure involves a group of individuals who relate frequently to dozens of others. Written records, formal procedures, and adherence to a consistent set of expectations are necessary for the group to work effectively together. The by-laws or protocols of the leadership group should specify the foundation procedures. Well-run hospitals adhere to their administrative protocols/by-laws to gain predictability. Many people become inpatient with such a formality, and a hospital can establish a deliberate tradition of informality, but only within certain formal constraints.

3.  The leadership (board) and hospital administrator should agree on short-term, usually one-year, goals and expectations and should review progress toward them on a quarterly basis. The expectations for the hospital administrator are generally more ambiguous than those of others on the coordinator team. They are more subject to unexpected outside influences. On occasion, the administrator's goals and objectives must be radically revised in mid-course. The leadership and administrator require flexibility. The expectations for the veterinary hospital administrator must be related to the goals of the practice entity as a whole. Think of the practice entity as the administrator's "patient", the leadership/governance as the "owner", and the standards of care being budget guidance, policy, and precedence.
The administrator's charter emerges from other activities of the leadership also, particularly the long-range plan and approved annual program-based budget.

4.  The leadership and the hospital administrator should have a mutual understanding of the employment contract. There is always a contract, and the formality of the contract depends on the situation. However, more detailed contracts have become popular in recent years for this position. We like letters of agreement (LOAs) for coordinators for the same reason. The contract should specify any departures from the usual duties expected, mechanisms to review performance and compensation, and procedures to amend and revise the operational charter. It should also state procedures for termination of the relationship, including appropriate protection for both the practice and the administrator. Properly performed, the hospital administrator's job in a multi-faceted practice facility is, and always has been, a high-risk environment. Thus, even handshake agreements should include appropriate protection, in case an administrator departs the system.

5.  Compensation should be based on market conditions and contain incentives for effective performance. As a general rule, the only fair and reasonable guideline for designing a compensation package is the marketplace. That is, what the practice would have to pay a similarly prepared individual and what the person could earn in similar employment elsewhere.
The high visibility of the hospital administrator, internally and externally, and the relatively high income compared to the traditional small general practice situations, often tempt unsophisticated owners/leaders to use other criteria, which will cause difficulty and conflict for the entire practice. The value and contributions of a skilled veterinary hospital administrator are almost impossible to determine. Comparisons to other personnel are, therefore, problematic. No matter how much other people earn, if a similar position would pay more elsewhere, the administrator is being underpaid. If the compensation package is above the marketplace, the hospital's money is being wasted. The marketplace used to determine pay should be the same one used in the selection procedure. See the VCI® Signature Series Monograph Compensation Strategies for alternative systems and contracts.
In this emerging field of veterinary hospital administration, there is a national market for people trained and experienced in effective, affiliated, multi-owner, or multi-doctor practice environments.

a.  Compensation includes pre-tax payments, in addition to salary, some that often are unique to the hospital administrator. Besides salary, the package can contain benefits offered to all staff, special benefits offered to selected key persons, recognition bonuses and merit increases, disposition of incidental income earned by the administrator, and an agreement on both voluntary and involuntary termination compensation.

b.  Special benefits usually exploit the mutual interests of the hospital, the administrator, and the income tax laws. These can include payments for housing, transportation, education, association dues, registration and certification fees, and deferred income provisions.

c.  Recognition bonuses and achievement incentives are more common in established practice environments, based on excess earnings or savings, when compared to the annual program-based budget.

d.  Quarterly performance planning, as well as annual reviews for merit pay increases, is expected. The quarterly performance planning process is a self-directed goal list for seven key result areas (KRAs), with the measurements of success for each. In the annual merit pay review, the hospital administrator is rewarded for his or her efforts toward the agreed-on goals, with the amount determined by the leadership group, during the annual budget planning process. They will consider the overall success of the practice and the contributions to the development of the executive team (coordinators), as well as community out reach efforts.

The administrator, who is respected and dealt with as above, should have a similar set of parameters for the coordinator's executive team. The coordinator's, who are respected and dealt with as above, should have a similar set of parameters for their respective zone team members. Gain-sharing, a form of profit sharing, is an expected outcome of this process. Excess earnings and/or excess savings, which positively affect the net income of the practice, is where the respective recognition bonus must come from every time. Never pay incentives or recognition based on changes in gross, only use net income. Only net income can be spent as discretionary spending.

To accomplish everything discussed in the previous pages, the veterinary hospital administrator and the respective zone coordinators must bring very specialize skill sets to bear on the operations of the practice and facility.

Technical skills acquired through formal education and experience usually include some form of: image marketing, investments, construction planning, human resource management, and client solicitation.

Leadership skills are developed almost exclusively through experience, and they are based on strong human relations skills, but they are difficult to test, so a review of experiences and checking references are essential in the screening process.

Decision-making skills looks at quality, as well as quantity, and the style of leadership, from autocratic to democratic, should vary with the situation. For example, an exclusive, autocratic style tears at the fabric of cooperation and caring healthcare delivery, but may be required in times of major crisis.

Character includes skill sets of ethics, emotional strength, commitment, and bio-ethical compassion. Administrators, coordinators, doctors, and staff are in high-stress situations every day, and must have the internal mind-set to care and nurture others, regardless of their own work pressures. It is probably true that character can be strengthened, and the ability to handle stress can be learned, but it is all based on a balanced life. For example, the American College of Healthcare Executives requires its diplomates to stay involved in community activities. Failure to stay actively involved is cause for loss of certification. Since the diplomate boards are required at five-year intervals, there is a true check and balance system involved.

Measures of performance can take many forms, but there are some basic objective measures that should always be addressed, when staff members are assuming leadership or coordination roles:

 Demand and market share measures. Administrators and client relations specialists can influence demand by effective planning, operations, service relationships, and promotion. Market share is usually a relative demand, as opposed to absolute demand, and is an internal progression measure.

 Outcome measures. The leadership needs to phrase things in terms of outcomes, ensure people know the boundaries, and jointly set milestones and measurements of success on a time-based clock. These can include quality of output, technical performance, staff recruitment and retention, formal and informal satisfaction surveys, stratified random samples of the community perceptions, often done by "focus groups" or a Council of Clients, and a host of other "outcome-based" operational needs.

 Resource consumption (cost and efficacy) measures. Cost measures are readily available from annual budgets and monthly reports, as income can be. However, for the healthcare delivery team, it all needs to be presented as a readily available aggregate, such as cost per discharge, income per FTE staff member, savings in excess of expected costs, and other ratios that reflect meaningful input-output relationships.

 Profit and financial condition measures. Expectations for profit arise from the program-based budgeting process, and the commitments to programs. While out of the hands of the administrator, these can be tracked by the coordinators and staff, and then fine-tuned by administrator negotiations with participating players. The success of the individual participants means success for the practice entity.

 Subjective assessment (process evidence supporting outcomes). Outside influences are a diverse set of "exceptions" and "demands", and may be reflected in the recruitment programs for staff and new clients, such as referring practices for specialty practices, as well as in-service training programs and staff development efforts. The staff deserves respect, responsibility, and recognition from every leader and every doctor, every day, and in every way. Their perception of these three Rs is subjective, yet essential, for their pride and subsequent facility success.

 Prior operational agreements. Obligations to support the practice, zone productivity reports, information technology, community relations, planning, and forensic/legal concerns can affect this management-by-objective measurement, but must be kept in equitable balance with the other measurements. Some inexperienced administrators prefer to do "taskings", which means they are not bold and robust in the decision-making process.

 Non-quantifiable achievements. Recognition from the community, involvement in civic clubs, and other activities that bring awareness of the facility and healthcare delivery team are "icing on the cake" in most cases, but concurrently increase the practice's awareness of community needs and demands, thereby assisting the strategic response capability of all.

 Coordinator development and team harmony. Self-evaluation is always expected. This is often confused with specific reports or achievements, but the organizational climate is a critical factor that must be evaluated, when assessing the effectiveness of any veterinary hospital culture. A true leadership team will develop people through work, while the traditional management concept just gets work done through people.

This chapter has shared as much leadership as it has human resource information, and that is for a specific reason. Leaders create the culture for the staff to prosper and grow within, and that is what the following chapters are all about. Grin and enjoy it, the adventure is about to begin!