Most Doctors Have Little or No Management Training, and That’s a Problem

Photo courtesy of Nicholas Blechman

By Foster Mobley, Jennifer Perry, and Matt Brubaker

Rising pressure to achieve better medical outcomes with increasingly limited financial resources has created an acute need for more physician leaders. Several studies (including this one) have shown that doctors want to be led by other doctors; they trust physician leaders to make the right decisions about redesigning health care delivery and balancing quality and cost. Fair or not, they believe it’s harder for leaders without clinical expertise to see how cutting costs impacts quality of care.

Yet most doctors in the U.S. aren’t taught management skills in medical school. And they receive little on-the-job training to develop skills such as how to allocate short- and long-term resources, how to provide developmental feedback, or how to effectively handle conflict – leadership skills needed to run a vibrant business.

A popular way of bringing physicians up to speed is to elevate them into management roles and team them with business executives. But this approach, called the “dyad model,” is not an optimal long-term solution, for reasons we’ll describe. Rather, we suggest a different approach: carving out a career path for younger physicians with leadership potential and creating a well-designed development pipeline so doctors emerge able to effectively lead large organizations of medical providers.

The Dyad Model and Its Limitations

What often happens with the dyad model is senior physicians are paired with business executives, either as co-leaders or with one reporting to the other, to run an organizational unit, region, or business segment (e.g., acute care hospitals, rehab clinics, physician practices, and urgent care centers). Some health care businesses use duplicate dyad management structures—one to oversee the clinical enterprise and another to oversee the business and operations that support the clinical enterprise. It’s important to note that, in all cases, these organizations still need a chief medical officer (CMO) who focuses solely on clinical operations, and who oversees quality, compliance, and other key aspects of care. The CMO should not be part of the dyad model.

The dyad model can help break down silos, improve the way clinical and operations leaders work together, and coordinate care. And this has produced good results at a number of organizations, including the Mayo Clinic (two leaders shared the top job until 2015), Cigna Medical Group, and Carle Foundation Hospital.

However, dyads can create inefficiencies and duplication of resources (not to mention higher-than-necessary salaries) and delay decision-making. The model can also create confusion about roles and spawn outright conflict; we’ve seen power struggles between leaders with different priorities, who often issue conflicting messages to the areas they lead.

Finally, this model doesn’t go far enough to prepare doctors to be organizational leaders. It doesn’t require physicians to learn deeply about the business and gain critical financial, operational, and management skills – limiting their ability to grow into stronger leaders or advance further in the organization.

In an environment of intense cost pressures, we believe it’s more economically sustainable in the long run for a health care organization to have a single, highly effective physician leader running the business and holding both clinical and administrative responsibilities, rather than bifurcating the role. There are two reasons: One is you don’t need to pay two leaders to do the job that one highly capable leader could do. The second is, it can reduce physician turnover (and thus the cost of recruiting) and boost morale. While having such a big job may sound like a heavy burden – being responsible for clinical stewardship, key strategic and operational decisions, and financial management – when physician leaders’ development is effective, their roles are clear, and they know how to focus their attention, they can handle the job without burning out.

But to do this, organizations need a cadre of physician leaders who are interested in taking on management roles and have the necessary business skills to lead effectively.

Building a Physician Leadership Pipeline

Based on work with dozens of health care organizations, we have adapted the leadership development model of Ram Charan et al to outline a leadership path for physicians.

This pipeline moves physicians through five levels of leadership – each allowing them to take on greater responsibility and gain the experience and skills necessary for succeeding at the next level. Over time, they develop the capacity to lead beyond the clinical enterprise and a more holistic view of the organization’s needs.

Each level involves a specific focus and set of skills:

Individual Practitioner: This level comprises practicing ph