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To be successful, healthcare organizations must delve into optimizing leadership skills and building a deep pipeline of executive-ready talent.
Optimizing leadership skills and building a deep pipeline of executive-ready talent is more critical than ever, given a fast-and-ever-evolving healthcare environment. With the introduction of new laws, regulations, and payment models, new leadership styles need to be implemented to effectively lead and manage in the new paradigm. However, alongside the need for modern leadership competencies is the need to address an impending talent shortage of leader ready talent. In fact, executive turnover is expected to increase due to a high number of leaders eligible for retirement, combined with a shortage of senior leader ready talent. 
To survive, and thrive, healthcare organizations must take advantage of all its institutional talent. Yet, this can only be achieved if leaders widely embrace the need to address the issue of leadership development. Healthcare organizations, like many, are slow to invest resources to identify and develop next generation talent. This is problematic in light of our research that shows a significant gap between what directors do well and what is needed to be a successful executive. This is a classic case of "what got you here, won't get you there."
Preparing director level talent
The most obvious place to leverage existing talent to fill future executive leadership vacancies is your director level talent. Executive roles are the next natural stepping stone for directors, but in what ways do they need to change or develop in order to succeed in the new role? This question is vital to address, given that the skills required of a director are vastly different than the skills required of a senior executive.
Understanding the skill gap between directors and executives is the first step in aligning development activities to the required behavioral competencies of executive roles. Development plans should help directors build upon their strengths and pinpoint the competencies that will grow them into successful Executives.
Key competency gaps between leadership levels
XBInsight collected competency data on directors and executives in several healthcare industries (pharmaceutical, biotechnology, staffing, and hospitals). After conducting sophisticated statistical analyses to identify competencies where executives scored significantly higher than directors, a vital skill gap between the two groups was uncovered. Directors are most competent in managing people and executives in managing ideas.
Key executive level skills that need to be addressed in Director-level roles:
The Leads courageously competency, according to our data, is even more important in healthcare than in other industries, because of the amount of ambiguity and change. This competency is one that many directors do not have an opportunity to develop in roles that are typically focused on operations and quality.
The largest gap between directors and executives is in Leads Courageously. As a major part of their roles, executives must make tough decisions and do so with confidence and conviction. They need to engage audiences in high-stakes meetings and be persistent in the face of adversity and dissension. They also need to be willing to share opinions and needs with clarity and conviction, even if these opinions are unpopular.
To develop Leads Courageously…
While our data shows that directors tend to be excellent listeners, executives take this a step further and are balanced, articulate communicators. They speak clearly and concisely, use expressiveness to convey important points while communicating, accurately communicate complex information, and adjust their style and delivery depending on the audience.
Leading courageously is the first half of the equation. Strong leadership rests on committed followers. There are a cluster of three competencies that represent bringing others along. In executive roles, the challenge is to win the hearts and minds of the organization so that people clearly understand and embrace the organizational strategies. The following three competencies are critical to building the engagement and buy-in that fuels change.
To develop Communication…
While directors tend to direct, executives gain buy-in for important decisions and initiatives. To do this, they identify alternative strategies and gather input from all stakeholders, attempt to create win-win situations, listen to others, and negotiate within and beyond the organization to reach the best outcomes.
To develop Gains Buy-In…
Our research shows that directors tend to be optimistic-keeping positive about the future, expressing belief in those around them, and helping others see the positivity in any situation. This optimism can be refocused in a way that it helps develop the critical executive competency of inspiring others. Executives tend to understand the organization’s strategic vision and communicate this vision in a compelling and enthusiastic way throughout the organization.
To develop Inspires Others…
The bottom line
The bottom line is what brings success to a director is qualitatively different than what brings success at the executive level. With this knowledge in hand, healthcare organizations must then identify which of their current directors should begin the development process by undergoing an assessment to benchmark and uncover their specific competency gaps.
Using this vital insight, healthcare organizations can help transition the strengths of their curren directors into competencies required for executive-level positions. This development approach allows organizations to build pathways that will result in a broader, more engaged talent pool, which ultimately results in a succession-ready organization.
Katherine Graham-Leviss is President at XBInsight.