3 Key Trends Affecting the Healthcare Leadership Landscape
The healthcare landscape is evolving and so are the metrics for leadership within the sector. In our latest white paper, Healthcare Leadership Trends for 2024, we dive into an array of current leadership trends and observations from leaders across the industry.
Top Leadership Trends Impacting the Future of Healthcare
These three key trends outline a shift in strategy to tackle challenges in leadership recruitment, retention, and engagement.
Leaders See Better Times Ahead with Varied Growth Initiatives
Leaders showed an improving outlook on the forward health of their organizations. After a steep decline last year, the percentage of respondents foreseeing better overall health over the next 12-18 months leapt 15 points to 52%. No change and worse both decreased, but the latter still means that one-quarter of the population anticipates deteriorating conditions.
Reported Growth Strategies
- Existing service line expansion: 56%
- Significant cost reduction: 45%
- Value-based reimbursement growth: 38%
- Significant partnerships with payers or other health systems: 35%
- Telehealth: 25%
Substantial declines from last year’s survey were incurred by outpatient care growth, recovery of procedure volume lost during the pandemic, and telehealth. These strategies remain important, but some reordering of emphasis is apparent. After years of heavy investment in new outpatient facilities and physician groups as well as in telemedicine, organizations now may be digesting those moves and favoring expansion of services in place.
Peering further ahead, surveyed leaders deemed two forces as most disruptive to healthcare over the next three years. Financial pressures headed the responses on a rise to 44% from 12% last year. Dropping to second place was serious clinician issues, halving its mentions from 66% to a still-significant 33%. The dominance of these twin forces shows how powerfully they are perceived. Non-traditional competition placed third on the list at 7%, which may imply some skepticism on the ultimate success of retail health.
A Gap in Leadership-Clinician Engagement Persists
The Trends survey annually queries leaders on their perceptions of engagement levels of their leadership team, physicians, and nurses. Compared to prior year, the 63% perceived level of leadership engagement reflects across-the-board improvement. The figures shown for high engagement represent increases over last year of six percentage points for leadership, four for doctors, and eleven for nurses.
The positive direction is tempered by the continuing engagement gap shown in the chart between leaders and clinicians. Medium and low engagement was ascribed to a bit over one-third of leaders but two-thirds of the clinicians. Closing this gap is a priority.
It is important to note that these results represent the leadership perspective. Independent clinician studies, including extensive ones from AMN Healthcare, convey significant clinician disengagement and burnout. Studies point to avenues of improvement.
A JAMA Health Forum study identified higher clinician burnout associated with lack of workflow control and chaotic workplaces, while efficient teamwork and feeling valued promoted positive engagement. Additionally, a study from Deloitte revealed that 57% of clinicians are more optimistic about their organizations when there is a leadership role dedicated to staff wellness.
Culture, Compensation, and Colleagues are Key for Retention
Leadership retention prevents costly turnover and minimizes strategic disruption. Here are some of the key factors affecting retention:
Career Satisfaction
A bedrock factor in likelihood to stay in a position is overall satisfaction with one’s job and employer. Satisfaction levels on both measures tracked positively. Regarding their current jobs, 38% of leaders said they are extremely satisfied and 44% are somewhat satisfied. Both numbers are in line with 2022. C-Suite and VP respondents showed 7 to 8 point higher satisfaction than directors.
Respondents’ satisfaction with their organizations recorded similar numbers, with 30% extremely satisfied and 44% somewhat. A clear exposure is heralded by the 18% who expressed neutral to extremely dissatisfied feelings about their jobs as well as the 26% in the same status regarding their organizations.
Opportunity to Move
The urgency to attend to retention is underscored by evidence on leaders being approached to leave. In fact, 4 in 5 respondents were approached with a credible job opportunity within the past six months. This level is up slightly from 2022.
The good news is that 62% of leaders did not pursue the overture, although a significant 17% did. Among those who expressed dissatisfaction with their job, 37% pursued the competitive opportunity. Additional vulnerability was seen at the VP level with 29% of that cohort having pursued it. This offer activity poses risks of heightened turnover rates, which are already significant.
Advancement Potential
One additional variable in Figure 9 deserves elaboration. Career potential ranked fifth and increased five points over last year. Perceived advancement opportunity within an organization is a key inducement to stay for many leaders. Only 25% of respondents stated they are currently on an advancement track, an uptick from last year’s 20%. Conversely, 21% believe they must leave their employer if they wish to move ahead – 40% among those dissatisfied with their jobs.
Management experts stress the value of broad career development efforts, including greater attention to middle managers, who play a large role in navigating rapid and complex changes for healthcare businesses.
Other Factors Influencing Retention
Multiple factors influence decisions to stay. Asked to name the top two, respondents ranked their top retention factors—several observations emerge from this list:
- Culture, compensation, and colleagues have occupied the leading responses for several years. These “three Cs” remind leaders that creating a positive, thriving organizational culture is far more than a “nice to have.”
- Colleagues led last year’s list, as the pandemic drove employees to derive support from their co-workers in a fraught time. With the crisis waning in intensity, the broader cultural considerations may be coming to the fore.
- Management’s role placing only fifth, on a drop of 8 points from 2022, suggests an opportunity to enhance the management team’s retention skills.
As a thought leader in our industry, AMN Healthcare produces a series of surveys, white papers, books, and webinar presentations internally and produces research and thought leadership for third parties. For more information on how AMN Healthcare Leadership Solutions can help you navigate your talent needs, contact us today or visit our website.
