Leadership
Physicians Leading | Leading Physicians

The Importance of Leadership to Organizational Success

Article · December 14, 2017

Leadership is an oft-used and sometimes nebulous term, particularly in the field of health care. Although leadership is not traditionally taught in medical schools, physicians possess many qualities that are needed to excel at leadership. For example, medicine requires critical thinking skills that are analogous to those required for effective leadership, such as assessing complex problems, formulating diagnoses, and generating action plans.

As a result, health care organizations are increasingly recognizing the importance of engaging physicians in their leadership teams, and this engagement will become even more important as the health care environment becomes more challenging. For physicians, leadership can provide an opportunity to strengthen their organizations and positively impact the lives of thousands of people. In this context, what does leadership mean, what are its attributes, and what tools do physician leaders have at their disposal?

Foundations of Leadership

A simple definition of leadership is the ability and willingness to take ownership of the organization (or the component of the organization that one is charged with managing), combined with an intrinsic drive to do what is best for the organization. However, for leadership to be effective, it must be built on a solid foundation consisting of a clear mission, a vision for the future, a specific strategy, and a culture conducive to success. New leaders need to understand that these concepts are essential for effectiveness and personal growth.

  • Mission. Simply put, the mission is the reason that an organization exists. For a hospital, the likely mission is to provide high-quality and compassionate medical care. For an academic health center, the mission may be expanded to include producing new knowledge and training the next generation. Having a clear sense of mission is crucial for guiding leadership decisions and choosing between alternatives.
  • Vision. Vision is a conceptualization of a future, and hopefully better, state toward which the leader navigates the organization. Vision should be systematically formulated on the basis of an analysis of demographic trends, scientific advances, and technological innovations in the field. For example, in the field of cardiology, an aging population with an increasing prevalence of calcific aortic stenosis, coupled with innovations in transcatheter aortic valve replacement (TAVR), should motivate a prescient leader to prepare for the introduction of this new technology into the practice and to consider its secondary consequences on surgical volumes, staffing needs, and hospital finances and facilities.
  • Strategy and Tactics. Strategy refers to the plans that the organization follows in order to be successful and competitive, whereas tactics refer to the specific steps that the organization takes to achieve and implement the strategy. In other words, strategy is what an organization will do to succeed and compete in its competitive space. A tertiary care hospital (e.g., the Mayo Clinic) may aspire to be the preferred national referral center for complex diseases. The strategy that it follows to achieve this vision may include developing a team of nationally renowned physicians who work in a multidisciplinary manner and broadly developing its reputation (brand). The tactics it may use to achieve this goal may include providing advanced training for its teams, developing cutting-edge treatments, demonstrating the best quality metrics, improving patient experience, and publishing its outcomes, among others.
  • Organizational Culture. Organizational culture is a crucial component that leaders must understand to achieve maximum effectiveness. The best leaders positively impact long-term organizational culture and values through self-modeling of behaviors, creating cultural expectations, and formally communicating cultural expectations. For example, an expectation of maintaining and professing mutual respect at all times can be set and demonstrated by leadership, even in difficult situations. Effectively responding to instances of a breakdown in mutual respect, rather than letting them go unaddressed, are critically important in further solidifying a positive organizational culture.

Leadership Skills and Attributes

In addition to cultivating a conducive environment that is built on a strong foundation, effective leaders must exhibit specific skills and attributes to achieve the goals of the organization. These traits include excellent communication skills, empathy and emotional intelligence, team-building skills, an understanding of the competitive landscape, strategic thinking, and courage, although this list is by no means exhaustive.

  • Communication Skills. The most important (some would argue the only) tool that leaders possess is communication. Effective communication ensures understanding and is not the same as simply sending out messages or emails. Communication is a two-way interaction, and the ability for the leader to listen is critical. Leaders should practice active listening, rather than just being quiet while others speak. A simple but effective way to practice active listening is to take mental notes while others are speaking or communicating. With time, a leader can become very adept at this skill and others will notice that the leader is actually paying attention. Being heard is important to others, even if final decisions are not what was initially requested.
  • Empathy and Emotional Intelligence. Empathy and emotional intelligence are key leadership traits that frequently are overlooked. Leaders regularly are called upon to deal with challenging and, at times, unpleasant situations (e.g., conflict situations, crucial conversations, and some annual performance reviews). Having a high degree of emotional intelligence will enable the leader to deal with such situations effectively and objectively while not avoiding the underlying issues. It is important to note that emotional intelligence is a skill like any other and can be developed with practice and coaching. Similarly, an empathic leader who can sense how others feel will be a much more effective communicator and team builder and will be more likely to effectively manage change. Interestingly, this same trait is critical to developing the patient-physician relationship.
  • Team-Building Skills. The most effective teams (e.g., President Lincoln’s “team of rivals”) include talented individuals with complementary areas of expertise who are comfortable expressing their opinions. It is the responsibility of the leader not to dominate the conversation and to ensure that teams feel safe speaking up. The effective leader trusts the team members, challenges them, and lets them handle difficult situations. When difficult decisions are required, leaders and their teams will require a high degree of emotional intelligence and courage to make the right decisions for the organization, even if doing so presents challenges in the short term. Courage in leadership is yet another skill that can be developed with practice over time. What is required is a commitment to fairness, transparency, and doing the right thing.

Cultivating Leadership Skills Over Time

Leadership skills are grown over time in a progressive fashion. At the start of one’s career, an individual typically works in a technical area and distinguishes himself or herself through technical expertise, outcomes, and innovation. For example, a cardiac surgeon may distinguish himself or herself on successful outcomes, a low mortality rate, and the introduction of new procedures.

The next level of leadership is operational. At that level, the individual (e.g., a hospital echocardiography lab director), will gain financial and operational knowledge and quantitative skills (such as understanding costs) that are relevant to the role. If the individual excels at that level, he or she may be tapped to undertake higher-level roles that are more strategic in nature.

A senior leader will be required to understand the competitive environment, macroeconomic trends affecting the practice of medicine, and upcoming regulatory changes. In addition, a strategic leader will need to keep a constant eye on the competition. Positioning the organization for success in a rapidly changing environment with fast-moving competitors is one of the primary responsibilities of the senior strategic leader.

Learning, Improving, and Practicing Leadership Skills

It is important to recognize that leadership skills, like any other type of skill, can be learned and improved. The knowledge-based components of a skill, such as finance or accounting, can be acquired readily in class, online, or with self-directed learning. More challenging, however, is the development of the personal attributes that are necessary for effective leadership. Feedback is a key tool in the development of these attributes. The most common, but sometimes least effective, form of feedback is the annual performance review. More effective methods are structured 360-degree evaluations (which provide the opportunity for honest and frank feedback) and coaching (which can be used to establish and execute individualized developmental plans).

Practicing leadership is as much an art as it is a discipline. A common mistake is for leaders to get too involved in day-to-day operational issues, thereby taking their eyes off the ball and potentially missing new opportunities or emerging threats to the organization. With a team-based mindset, the goal of the leader should not be to make the best decisions for the organization, but rather to ensure that the best decisions are being made at all levels. A leader who attempts to make all the decisions will inevitably fail as it is impossible for one individual to be correct all the time. A leader with an engaged team will benefit from a more diverse analysis of challenging situations and will be more likely to make the right call. Team-building, empowerment, and trust with a willingness to listen to suggestions with an open mind are signs of prescient leadership.

Leadership During Constant Change

Because organizations and their environments constantly change, one of the core responsibilities of leaders is initiating and managing the internal changes necessary to adapt to changing circumstances. A thorough discussion on managing change is beyond the scope of this essay; however, it is likely true that without initiating change, one is merely managing and not leading. The ability to effectively institute positive change will stretch and challenge even the best leaders. The attributes discussed above are critical to this process.

Great organizations require great leaders, and the best organizations understand that cultivating leadership skills should be intentional and not left to chance.

The Ship Model of Leadership

A ship can be used as a conceptual model to illustrate several concepts related to organizational behavior and leadership. In this model, the organization may be conceived of as a ship carrying its payload (products or services) to its future destination (vision) through waters (the competitive environment) that at times may be still and at other times may be very choppy (uncertainty, decreasing reimbursements) or may even have icebergs (massive changes in the regulatory environment). It is the responsibility of the leader to be aware of the macroeconomic, government, and regulatory trends that can put the organization at risk and to position the organization not just to avoid these icebergs but to thrive in the future environment. Other ships (competitors) will be engaged in the same enterprise and will compete for the same customers and resources. The leader should have a clear view of the future, the competitive environment, and the direct competitors and should have contingency plans in place to deal with unanticipated events (icebergs). Thus, the primary responsibility of the captain is to chart a pathway through the waters to reach the goal.

 

In this model, the strategy may be for the ship to go faster and be more maneuverable than its competitors. Tactically, the captain or executive officer will have to determine how the oars will be pulled faster, harder, and more efficiently; how its sails will be trimmed for maximum efficiency; and even how to shed deadwood. If the strategy is implemented successfully, the ship will beat its competitors to the goal, will provide value to its customers, and may be able to charge a premium price for that service. It is important to note that the development of a strategy includes defining what an organization will not do. For example, another potential strategy may be for the ship to be a very large, but slower, purveyor of goods and services. This strategy would enable it to charge low prices but still be profitable. This strategy can work, but it is distinct from the strategy of being fast and maneuverable. In business, it is very difficult for an organization to simultaneously be the low-cost provider and the premium provider. Similarly, in health care, it can be extremely difficult for one organization to master community-based population health as well as resource-intensive destination care simultaneously, unless it is extremely intentional about implementation. Finally, for effective strategy development, a comprehensive understanding of the organization’s core competencies and capabilities (e.g., how fast and how efficiently the crew can pull the oars) is critical. Internal expertise, talent, and capabilities will determine what type of strategy can be considered.

New Call for Submissions ­to NEJM Catalyst

Connect

A weekly email newsletter featuring the latest actionable ideas and practical innovations from NEJM Catalyst.

Learn More »

More From Leadership
Amy Merlino and Tom Lee head shots

“Humanware” vs. Software

Will those who recall the lost art of paper prescriptions contribute, or gracefully bow out, to technology?

Is Improvement a Matter of Urgency?

The desire to minimize bad news is why so many change efforts lurch from start. But urgency means results are needed, not just activity.

Namita Mohta and James_Stoller

Leadership Pearls: Small Nuances Are Powerful Drivers

There’s a difference between leaders who are physicians, and physicians who happen to lead. So what is it, and how do we find it?

Four Ingredients for Engaging Physicians in a Network Setting

A former physician network leader offers tips on building an environment conducive to change.

Christopher O'Connor and Tariq Ahmad

How Do You Identify and Develop Talent?

A young leader in cardiology interviews his former mentor, Christopher O’Connor, on what it means to be a good leader in medicine.

Marc Harrison and Tom Lee_150

Coming from the Outside and Driving Change

Intermountain Healthcare’s CEO says it’s about connecting with what communities believe in.

Building a Better Physician Compensation and Performance Model

Spectrum Health Medical Group designed a physician compensation model that not only rewarded physicians for providing consistent high-quality patient care, but also motivated them to do so.

plietz-engagement

Becoming an Employer of Choice

How WellStar Health System reached a 97th percentile employee engagement score by prioritizing trust and retention.

Physician-Led Coaching to Improve Patient Experience Scores

The value of physician-to-physician communication and feedback cannot be overemphasized.

Engaging Clinicians: The UMMA Model of Primary Care Provider Satisfaction

How a community health center improved primary care provider satisfaction and retention from a 20% annual turnover rate to zero.

Connect

A weekly email newsletter featuring the latest actionable ideas and practical innovations from NEJM Catalyst.

Learn More »

Topics

Leading Transformation

193 Articles

Amazon and CVS: Short-Lived Unicorns in…

Will Amazon–Berkshire Hathaway–JP Morgan and CVS-Aetna change the health care game? To one health care…

Leading Teams

130 Articles

Action Learning–Based Leadership Development at an…

How Mayo Clinic utilized an action learning–based program to foster the leadership skills needed to…

Team Care

86 Articles

Leadership Survey: Immunization Against Burnout

Clinician burnout is far from being eliminated at health care organizations, but leaders, frontline physicians,…

Insights Council

Have a voice. Join other health care leaders effecting change, shaping tomorrow.

Apply Now