Rise of the Chief Strategy Officer

Philip Betbeze, for HealthLeaders Media , November 25, 2013

Certainly many positions in the C-suite are morphing as healthcare leaders try to embrace the fact that systems are getting bigger with consolidation, that massive changes to reimbursement loom, and that health systems are taking on new responsibilities outside their traditional area of expertise—inpatient care.

Adriane Willig, a consultant with Oak Brook, Ill.–based Witt/Kieffer and an expert on strategy officer executive searches, says even in the current environment, not all organizations have this position and not all need it, although those that want to survive independently, regardless of size, probably should.

"The title is a newer version of what a strategy executive does, but it's an indication they are part of the senior team," she says. "Given the changing dynamics, it's critical for hospitals to be looking at the future and paint that vision, so having someone who can focus on planning for that uncertain future is becoming more critical."

Historically in many organizations, strategy has been done collectively by the CEO in conjunction with the board and often helped by outside consultants, says Willig, but that's no longer sufficient for many organizations. Foremost among their responsibilities, strategy officers are focusing on developing a framework for the entire organization, which even at a standalone hospital is a complicated place. The layering on of nontraditional offerings such as hospice, skilled nursing, a health plan component, or physician practices, just to name a few, brings another level of complexity. Finally, the CSO is charged with differentiating his or her hospital or health system based on value and quality—two metrics that, let's face it, are still relatively new to healthcare.

"In order to do that, they need to understand the whole spectrum of the business," Willig says.

The CSOs have to process information from disparate pieces and understand how to evaluate, using strong analytical skills, whether the organization has the right pieces for effective clinical integration, for example. Further, CSOs need to understand payers and the health insurance exchanges, and how to focus on driving their organization's differentiators into a competitive advantage with payers. They also need to understand technology, Willig says.

"You can't have a strong strategic plan without technology, and that's all coming out of the top strategy person or CSO," she says. "They have to understand everything from the technology to the mergers and acquisitions, as well as finance and operations. So it's a complex skill set and a person can't be a heavy hitter with all of these expansive skill sets." Which means the role of the CSO is still very organizationally driven in terms of what he or she needs to bring to the table, and why individual's responsibilities and influence seems to vary so widely among organizations that may seem similar in makeup.

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2 comments on "Rise of the Chief Strategy Officer"

Dike Drummond MD (11/29/2013 at 2:32 PM)
Chief strategy officer from outside of healthcare ... that is just one more member of the C-suite that has no concept of the stresses of the front line providers. With physician burnout rates at an average of 1 in 3 on any given office day regardless of specialty ... and the CSO clueless about what it takes to see patients ... my fear is they will recommend profit goosing moves that simply add to the stress on the doctors and nurses ... then scratch their head and wonder what is wrong with those people. If the CSO brings the mantra that exists in so many other industries - you know, this one: "We hire the best people we can find and take really good care of them" ... they might do some good. If they are just another clueless business mind that thinks healthcare is identical to running a manufacturing business [INVALID]- let's just make sure the current C-suite actually does some strategic planning twice a year. My two cents, Dike Dike Drummond MD TheHappyMD (dot) com

Donald G. Bellefeuille (11/25/2013 at 1:29 PM)
We've all been seeing more and more positions posted for Chief Strategy Officers. On the face of it I should welcome this recognition of the importance of our discipline in healthcare. But I just can't bring myself to do it. I argue in my blog,The StratEx Crossroad: Where Healthcare Strategy and Execution Meet, that our profession has to become more involved in the execution side of the equation. And that's what I don't see in a Chief Strategy Officer. By placing strategy at the center of the title and assigning chief to it you have essentially eliminated any possibility of getting involved in execution. Because any person in this role will want to maximize the amount of strategy they do, right? It's only natural because they are the Chief. And doing a lot of strategy means you are doing next to no execution. Then there is the problem of all the other chiefs popping up: operating, marketing, technology/information, medical, development, etc. How's that cliché go? Too many chiefs spoil something or other. So what is a poor Chief Executive Officer supposed to do? He is a Chief and, presumably, the head chief and execution is part of his title. So who is the Chief Strategic Execution Officer then? The CEO, the CSO, the COO? Who is the chief if everyone is a chief? I said in a previous post (Reorganization Is the Last Thing You Should Do) that the work should determine how you organize. And it's still good advice. The plethora of CSO postings sounds like just the opposite: That organizations are re-organizing themselves before they even know what the work in the new era of health reform entails. So be careful what you wish for as a Chief Strategy Officer. You may find yourself wanting more control over execution because when execution goes badly strategy gets blamed.




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