Making the move to COO or to a new leadership position for health systems-chief administrative officer-is a career step that is becoming increasingly attractive to many healthcare CFOs.
At a Glance
Strategies for positioning yourself for the role of COO or chief administrative officer include the following:
- Learn more than just the financial aspects of running a hospital or health system.
- Cultivate deep self awareness of your attributes as a leader.
- Find ways to accelerate innovation in your organization.
- Take a fresh look at issues that are continuing challenges for your organization.
The shift toward value-based business models and the emergence of new ways for measuring success in health care have put tremendous pressure on hospital and health system leaders. For many finance professionals, this increased pressure is prompting greater interest in new leadership opportunities. Some are looking outside of the CFO role and challenging themselves to apply their unique skill sets as healthcare COOs or in an emerging leadership role for health care-that of chief administrative officer (CAO).
"More and more, CFOs are seeing these roles as opportunities to apply the understanding they've gained related to strategic planning and thinking, performance improvement, and development into action-oriented leadership for their organizations," says Todd Nelson, technical director for HFMA.
COOs ensure that the day-to-day business operations of a hospital or health system run smoothly. These leaders work closely with the CEO and may oversee ancillary departments, facilities management and construction, development of new service lines, and more. They are actively involved in strategic planning for their organizations. In a multifacility health system, CAOs often are the top leader at a single facility. They may also oversee departments or services across the health system, such as supply chain services, support services, and facilities maintenance.
CFOs bring many important skills to these positions, including the following.
Strategic planning/thinking. The CFO understands-and more important, participates in and leads-broad-based long- and short-range planning that matches the organization's vision and mission.
Collaborative development. The CFO is charged with developing, recruiting, and leading a team of diverse individuals or departments in accomplishing strategic objectives.
Public speaking and organizational development. Working with potential stakeholders (e.g., donors, board, employers, and the public), the CFO is a key spokesperson for the organization, advocating for its mission and vision to meet its obligations and attain the resources it requires.
Performance and operational improvement. The CFO must understand the operational, clinical, and financial aspects of performance improvement and then balance the organization's human, financial, and operational capital needs to ensure success.
What does it take for a healthcare finance professional to lead his or her organization as COO or CAO? Here, three who made the transition share their stories.
Answering the Call
"The analytical skills I gained as a CFO-being able to trace activities through to the numbers and to see the line of sight in financial reports that shows how operations get translated into financial results-are probably among the strongest competencies I've brought to the COO role," says Peter DeAngelis, Jr., FHFMA, CPA, executive vice president and COO for Catholic Health East, Newtown Square, Penn.
DeAngelis took on his current role in May 2010. Previously, he had served as a hospital and health system CFO since 1990-first in a small-child and adolescent psychiatric hospital, then at a community hospital, then for an academic health system -before taking on the position of CFO for Catholic Health East, a large, faith-based system, in 2003.
"I'd felt for a number of years that I was being called personally and professionally to something beyond the CFO role," says DeAngelis. "But I didn't know exactly how I might get there or when I would have the opportunity to make the move."
Then in 2010, the CEO for Catholic Health East announced his plans to retire. "When I joined Catholic Health East, one of the aspirations I shared with the CEO was that I would be interested in a position beyond the role of CFO in the future," DeAngelis says. "Seven years later, our finance team had accomplished much of what we had originally set out to achieve and had been asked to accomplish, and our team had cultivated a deeper level of talent. From a timing perspective, it was a good opportunity to consider a change in my role at the health system. Most important, our new CEO thought I was ready for the opportunity to contribute my skills in new ways as COO as part of the newly constructed senior team, and asked me to consider the role. The timing felt right for me to accept this new opportunity to serve my organization's mission."
As COO, DeAngelis provides leadership, direction, and support to the health system's regional entities and coordinates resources across the health system, which comprises facilities in 11 eastern states from Maine to Florida. He also is actively involved in strategies related to enhancing patient care management, satisfaction, and overall value.
He's found that the role of COO can vary by hospital or health system. "In some organizations, the role of COO has a highly operational focus, and in other organizations, it's highly strategic," DeAngelis says. "It really depends on the organization and the CEO's determination of what that role is designed to fulfill. For me, it's the right combination of involvement with strategy, patient care management, and operations.
DeAngelis notes that there is no absolute job description for the COO role. "I was talking to one COO who had researched articles on what it takes to be a CFO, and there were many, but when he tried to find articles on becoming a COO, there were very few," he says. "Some healthcare organizations do without this role because of the way in which their teams are constructed."
Because of the broad range of responsibilities that his role as COO covers, as well as the relatively short time he has spent in his new role (two years), DeAngelis finds that he is always learning. The experience he gained as a CFO has helped him make the transition.
"Understanding where the opportunities and challenges lie is more difficult without that financial line of sight," he says. "The skills I developed around change management, process improvement, and team building as a CFO are without question even more important to the role of COO."
Embracing the Opportunity for Growth
The opportunity to increase her knowledge of the business of health care strongly appealed to Stella Visaggio, FHFMA, CPA, when her hospital's COO-who was being promoted to CEO-offered her the position of COO.
"I thought, 'Wow, this is a great way to constantly be learning,'" says Visaggio, who assumed the role of COO for Hackettstown Regional Medical Center, Hackettstown, N.J., in July 2011. "I also knew that not many people had been fortunate enough to be given this opportunity. I had been in the CFO position for 13 years, so I had substantial experience on the financial side of health care and in healthcare administration. I love to learn new things and new roles, so this was an excellent opportunity for me."
As COO, Visaggio works with a variety of departments, from ancillary and clinical departments to maintenance, environmental services, and dietary. The role requires a change in perspective from that of a CFO. "As a CFO, you're more reactive versus proactive," she says. "Much of what you do involves responding to the data. The financial burden of what's happening at the hospital is really on your shoulders. When you're involved in leadership at the executive level, you're involved in strategic planning and are more proactive in looking at processes, working with managers, mentoring managers, and identifying opportunities for improvement.
Visaggio also says being COO makes her much more visible in her organization. "I work one-on-one with managers, and I have many more managers and directors who report to me," she says. "I'm constantly learning from them about the clinical aspects of health care and the regulatory issues we need to comply with, and they're learning from me about how to look at things strategically and from a business plan standpoint."
One thing that surprised her about being a COO? The amount of patience required. "Process improvement takes time," Visaggio says. "I also wish that I had a stronger background in the human resources aspects of management, given that I have the second-largest number of employees and managers and directors reporting to me in our organization. And I wish I had a little more knowledge of the clinical side of health care-say, knowledge of anatomy or physiology. I understand that I can rely on my directors and managers to have that knowledge, but it would be good to have a basic education in clinical care to appreciate the clinical aspects of health care even more.
"There are so many opportunities where you can facilitate improvements that make a difference for your organization and the communities you serve," Visaggio says. "That's part of what I love most about being a COO: the opportunities to make a difference."
Making a Difference
For Ron Bunnell, executive vice president and CAO for Phoenix-based Banner Health, the opportunity to draw upon his CFO experience as CAO for Banner Health-a position that requires "big-picture thinking and strategic execution"-was the perfect way to help guide his organization through the challenges that lie ahead for the industry.
"It's really about being able to make a difference in people's lives and having an impact on an organization that is approaching health care in an innovative way," Bunnell says. "I very much enjoy not just being part of finance, but also developing the strategic initiatives that will enable us to be successful in the long term."
As CAO, Bunnell oversees all support services functions for Banner Health as well as nonclinical operations. These areas include finance, materials management, strategy and planning, development and construction, human resources, IT, marketing, and public relations. Bunnell also has responsibility for Banner Medical Group, Banner Health's health network, the health system's surgery centers and home care functions, and the laboratory company for the health system.
"The primary difference between my role as CAO and the responsibilities I held as CFO is the strategic focus required-looking at ways that our support services can help drive improvements in clinical quality and operations," says Bunnell, who has held the position of CAO since March 2006.
The role of CAO at Banner Health was created as a result of efforts to focus organizational improvement activities in three key areas: operations, quality, and support services. The health system comprises 23 hospitals, with support services departments in every hospital reporting to Bunnell. "Having all support services departments report to me ensures that we have common approaches to finance, resource management, and planning at each of our hospitals," he says. "This type of structure allows our facility CEOs to concentrate more fully on initiatives surrounding clinical quality and efficiency of operations."
Bunnell observes that no one could have prepared him for the amount of stress associated with being CAO. "I can remember being at a board meeting not long after I assumed the role of CAO where I had responsibility for reporting on the efforts of four separate committees," he says. "There was so much stress in getting ready for that meeting-it was a tremendous amount of work. One of the lessons I've learned is to delegate and to surround myself with great people who are good at the work they do, and to give them the opportunity to learn and grow."
Positioning for the COO or CAO Role
What does it take to become a healthcare COO or CAO? Here, industry leaders and experts in leadership offer a number of strategies to consider.
Develop a vision about the business. An inquisitiveness regarding health system operations as a whole-not just the finance processes-is critical to becoming a COO. "If you're a CFO who aspires to the COO role, you have to become a mini-COO along the way, by studying processes, not just financial results and analytics, and by giving the strongest weight to the people side of the equation," DeAngelis says. "Pay attention to leadership through living the organization's core values, and be attentive to the ways leadership influences the success of an organization. Be open to the intangibles and believe in the possibilities that only collaborating with people can help accomplish; break out of silos. In doing so, when you're given the opportunity to become COO, you'll already be thinking along the lines of a COO."
Examine how well you manage your emotions and whether your interpersonal skills engage and energize others. In the words of Carson Dye, senior vice president, Witt/Kiefer, and the author of Leadership in Healthcare: Essential Values and Skills: "Develop a relationship with someone who can offer feedback on your interpersonal skills: How are your listening skills? How effective are you in developing teams, giving feedback, and energizing people? When you come to work, what is it about you that engages other people-that empowers them and gets them excited? Effective leaders should have the ability to create an environment that make people feel motivated."
Find ways to accelerate innovation in your organization. The best advice Visaggio was given before taking on the role of COO was simply to listen carefully to the directors and employees she oversees, so that she may learn from them. She also is conscientious about putting together a management team with the attributes that will help the hospital grow. "When I look at managers who have been here for a while and who may be good in their roles, I ask, 'Are they OK with change? Are they comfortable with the direction in which health care is going?'" she says. "It's also important to mentor directors as much as possible and as often as possible, to help them understand how to monitor efficiencies and process improvements, how to better manage their employees, and how to support business growth."
If you are the CFO, groom a successor for your position. To be an effective CAO, Bunnell knew he'd have to release responsibility for Banner Health's finance functions to the successor CFO, so that he could focus more fully on broader issues for the organization. "It was challenging at first, especially because when I assumed the role of CAO, I initially was both the CAO and the CFO," Bunnell says. "Within a couple of years, we had a new CFO who had grown into the role and assumed all of the responsibilities that came with the position. That allowed me to put my energies toward the strategic initiatives Banner Health is undertaking."
Find ways to combat the stress of leadership. "Although my work is a big part of who I am and is integrated into other areas of my life, it's not the only part," DeAngelis says. "It's important to have balance between your work life and personal life. I put in no less than 60 hours of work a week in some way, shape, or form, which is common among healthcare leaders. I relieve the stress of my responsibilities through exercise. I play basketball; I try to stay active physically. I find if I don't work out for a week or two, the stress level builds pretty quickly. Just as important is the balance of family life with work life. It's important to schedule some downtime and be true to that time." Bunnell relieves stress by mountain biking and spending time with his five grandsons.
Take a fresh look at issues that are continuing challenges for your organization. "We need to continually look at everything we're doing with new eyes, sometimes like we haven't seen it or don't recognize it," says HFMA President and CEO Joseph J. Fifer, FHFMA, CPA.
Jeni Williams is associate managing editor, HFMA's Westchester, Ill., office.
Publication Date: Wednesday, August 01, 2012