Hospitals have two main problems when it comes to finances. One is revenue, as in they’re not generating enough, and the second is receivables, as in they’re not collecting enough on the revenue so they can pay bills and buy other stuff.

charge master consultant

Every hospital has a charge master. A charge master is a full listing of all procedures that a hospital provides. The reason there is a charge master is to help make the process of charging for services easier and faster. Charges are usually already priced and coded. The reason I say usually is that some charges aren’t priced because a hospital might be trying to track certain non-chargeable services, while other charges may have the procedures coded by medical records (such as many surgical procedures) instead.

For those charges that aren’t coded by medical records, this means that they have to be coded in the charge master. Most charges only have to be given a procedure code once, and then it remains that way forever. However, many others change on a regular basis.

The average number of years that facilities have someone come in and review their charge master is 3 to 5 years. Since big changes occur around the beginning of every year, and small changes occur quarterly, this means that hospitals may be charging for services that don’t exist and not charging for new services that have codes, and not getting paid because their codes aren’t up to date. On the first issue, even mistakenly charging for services that don’t exist could be considered fraud by Medicare, which could issue financial punishment by as much as triple the amount of charges they say a hospital fraudulently charged for.

Procedure codes aren’t the only thing one checks on in a charge master review. One also checks revenue codes, classifications which tell insurance companies where services are provided. One also compares what hospitals are charging for services and compares them with Medicare fee schedules (there are two different types) to make sure hospitals are billing more than what Medicare reimburses. This is because Medicare will only pay based on what they’re billed, so if the hospital charge is lower, not the actual fee schedule price, hospitals could be losing reimbursement dollars.

If a hospital has a charge master coordinator, or someone who’s only job is to perform this function, then an annual charge master review probably isn’t needed, but it can’t hurt to have someone check things out every 3 or 4 years; even accounting departments get audited. If they don’t… well, the consequences could be costly.

I spent six months at a 2-hospital system in New Jersey years ago doing their charge master, as they hadn’t had anyone working it in almost 2 years. I also did a check of their revenue. It turns out they’d actually had a charge master review by someone else 3 years earlier, but never implemented anything that had been recommended. By the time I left, they’d increased revenue by a couple hundred million combined. Later on I spent a year at a hospital in Westchester County. By the time I left there, they had more than doubled their yearly revenue.

Charge master reviews don’t take all that long to do if everything is set up properly. First it’s a review of all files. Then there are the department interviews, which is the timely part if access to the directors of all the ancillary departments takes time to pull together. Like most organizations that do this work, we charge based on the size of the facility. The larger the organization, the more complex the work, which means more time to do everything properly. Money on expenses can be saved if both parties are set up to do video or phone conferencing.

A charge capture, or revenue review, takes a little bit longer, and it probably works best to have it become part of the charge master review. The interviews with department directors are more comprehensive. They’re also educational, as anyone worth the work wants to spend more time with the directors and possibly some of their employees, giving instructions on charge capture, coding, and anything else as needed.

How much does all of this cost? Each organization has their own processes for coming up with the fees to do this sort of thing. To determine my fee, I start off with the hourly rate I want to get paid, estimate how long I think the entire process will take, then I give a project price for the requested work. If there are other projects the hospital wishes to explore, those fees will be add-ons, but the rates will be less if added to the original project that if it became a standalone.

Besides, that’s the wrong question to ask. A better question would be how much your hospital would be willing to spend if revenue increased by millions of dollars a year that you didn’t previously have, especially if you estimate than your reimbursement will average anywhere from 20 to 30%. Even if it was only 10%, no consultant’s fee is going to be anywhere close to that. 🙂

If you’d like to know more, check out my two-part series on what it is that charge master consultants do. Any questions or comments, please feel free to add your comments below.

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A couple of days ago a friend of mine shared an update that someone had posted on LinkedIn. It was a picture of her and 5 other young women at their company Christmas party, wearing dresses that they would probably wear out to a club. Two of the dresses could have been considered pretty revealing, while the other 4 wore dresses that fit them well enough to show off their figures.

Based on her question, it was easy to assume that when she first posted the image, she and the rest of the ladies took a lot of heat for the pictures, with some people saying all of them were dressed inappropriately for a company party. At the same time, there were a lot of crass males who wrote things I’d never think of repeating anywhere.

All of this happened on LinkedIn, which is supposed to be about business, where I’ve been shocked by the kind of deportment I’ve seen over the last two years; business professionalism has definitely changed over time.

My friend… he posted the link on Facebook, which brought up the picture, and asked us what we thought about it.

What did I think about it? I thought it was another lesson in human behavior and confirmation that no matter who you are, what you are or what you do, everyone’s watching you… all the time. Some will like it, some won’t, but they’re always watching.

My initial thought was that the dresses, while provocative, weren’t anything I hadn’t seen before. Back in the 90’s my hospital had a holiday party and there were a few ladies who had the bodies and the confidence to wear the same type of thing. The only different between then and now is that we weren’t all carrying around smartphones with cameras back then.

Even without them, we were still judged fairly often and quickly… even if we didn’t always hear about it. When you’re around a lot of people on a daily basis, every move you make is scrutinized by someone. Everything you wear is analyzed by someone. Whether you gain or lose weight, are happy or sad, are boisterous or quiet… you’re being watched and inspected and examined and dissected and ranked and liked and hated all at the same time.

What people think about you isn’t your business. – Jack Canfield

That’s a nice phrase, isn’t it? Unfortunately, it’s only 75% true at best. No matter what we do to bring money into the house, even as an independent consultant, we all have to decided what’s worth the trouble we might bring upon ourselves and what might be detrimental to our progress and success.

@djcharleebrown keeps the party rocking @whiteoakkitchen! Dance party! #whiteoakturns3
Christine via Compfight

There are people who are willing to stand on principles while others will sell their soul to kiss up to a superior. There are people who are strong minded and can handle people who don’t understand the intricacies of something and there are people who cave because they think everything that goes on is an attack on their soul and character. Sometimes those people are us; sometimes those people are the ones doing the judging.

I’m not above the judging thing. There are people I never plan to talk to based on things they’ve said and done on social media. There are people locally I’ll never give a minute of my time to because of something they’ve done to irk me. None of us have to deal with people whose character we’re uncomfortable with; that only makes sense.

I know I’m judged as well; that’s only fair. I also know I’m judged on many more levels than a lot of people who do what I do; that’s not martyrdom, it’s just reality. This means I understand that there are things I either shouldn’t do or shouldn’t do them so they’re visible. It also means that I understand that if I decide to do them anyway, such as talk about certain topics on this blog, that I might alienate some people who are uncomfortable with the subject matter. I’m good with that; as we say around here, “I’ma be me!” 🙂

What about you and your career? Can you handle the fallout of having pictures posted on social media where people say certain types of things that could possibly cost you your job or your company loses potential business? Do you worry about the fairness in being free to express yourself balanced against a populace that might have alternate views? At your own company, are you willing to stand up for a principle or will you keep silent because it’s in your best interest?

These are important questions to ask oneself, because the answers you come to will be important when deciding when to post certain things online, or say certain things online, or exhibit certain behaviors no matter where you are.

After you have those answers, what other people think or say or do when you do or don’t do your thing won’t matter anymore. Just remember though; everybody’s watching, all the time, and there’s no getting around it.

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This will be the last post of 2016 on this blog; I think it’s time for a short break. It’s also time for a bit of a breakdown of why I’ve lost confidence in the overall good of people, some introspection of myself to handle it, and some retrospection to help me move forward. As usual, the final blog post of the year is about me… and about this blog and my business.

The end to 2016

This is the year that I lost trust and confidence in society and the betterment of man… and woman. I’ve always believed in the best of people and said that in the end good things would win out; I was wrong. Not just in this country but in most countries around the world, this has been one of the worst years for decorum and people making truly informed decisions… and there’s no one to blame but each other.

For my part, I almost quit social media; that’s where my mind went. However, I knew that if I quit social media, I’d pretty much have to shut down my businesses as well, which includes my blogs. That’s one of those “cut off my nose to spite my face” thoughts I had to get beyond because I knew there were other ways to cope.

My way… remove myself from the bad and the hate in the world and concentrate more on myself, my family and my career. Even if I don’t trust people in general anymore and possibly question my patriotism, I still have some basic goals, which do involve the career I’ve created for myself.

I don’t need the news to talk about leadership or diversity; I have life experiences and enough knowledge on this subject to last as long as I’m in the mood to continue doing it. The same with health care; the only news hospitals care about is what’s going on with them and what I might be able to help them with.

I spent most of 2016 in a depressive state, mainly because of outside influences that have nothing to do with my daily life. Sure, I have some personal issues as it involves my mother’s health condition, which I’m finally starting to be more proactive in dealing with, but that had less impact on my mindset than it should have.

In retrospect, I had some milestones this year. I celebrated my 11th year of blogging about leadership. I hit 1,300 posts on this blog and 1,700 on my other main blog. I also hit my 15th year of self employment and went to two conferences that had nothing to do with health care… the first ever for me. I also spoke to 3 groups this year, although I ended up writing about being a revenue cycle consultant instead of giving it as the presentation because there was a miscommunication with the person who booked me; it happens! lol

I did some nice things this year, had a few accomplishments… but I’m ending the year thinking more about reinventing both my business and my personal life; good thing I have my Franklin Planner.

What’s coming for 2017? Specially I don’t know; does anyone know for sure? I do have some things I’m planning on working on, but I think I’m going to hold most of those close to the vest for now. What I will say is that I’m expecting to do more in 2017 than I did in 2016. This means writing more, doing more videos, promoting myself more on social media and at local networking events and going all out to make this one of my best financial years ever. If I can keep my peace of mind, all’s the better.

I want to feel more like the guy in the picture at the top right, not like the guy in the picture on this blog post. I’ve already started working towards that goal, as I’m in the process of redesigning my office for the first time in 10 years… with my wife’s help of course. New office, new perspective, new goals, new demeanor… the skies the limit!

I invite you to come along as I leave 2016 behind… for good! It didn’t happen; Just think of me as having a Pam moment and 2016 being Bobby Ewing (how’s that for a reference?). Onward and upward; first star to the left and straight on till morning… I’ll see you in 2017!

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I have a video coming out on Thursday that talks about 3 easy leadership lessons that everyone should be able to learn that will make them better leaders. They won’t make anyone a great leader, but they’ll certainly improve them a lot.

learning easy leadership lesson

With that said, and in an attempt to write a shorter post than usual (following a 4-part series about succession planning), I decided to limit myself to talking about one of the habits, and it’s the most effective one.

That habit: treat others like you want to be treated. That’s it; that’s all it takes. I can’t leave it at that, so let me embellish it a little bit.

The one thing that seems to be universal in business, whether someone is in a leadership position or not, is that they want to be respected. The lines of respect change based on the job, but overall people want to be respected as humans, which in turn means they want to be treated in certain ways.

I don’t know a single person who likes being yelled at, even athletes. I don’t know a single person who likes being demeaned or put down all the time. I don’t know a single person who likes being condescended to.

Yet I know a lot of people who do one or all of these things on a consistent basis. It’s irksome enough to get us riled in our personal lives, and often we won’t take it from people we don’t know, and sometimes we don’t want to take it from people we do know.

But what about having to take it from someone you report to, where retaliation could cost you your job or a chance for a promotion down the line? I wonder what managers think that treating someone bad by doing any of the 3 things I mentioned above is good leadership, good management, and inspiring to any employee who works with them.

Do you know any who you think believes this makes them effective? I bet you know some in leadership positions who do this, and you might believe they think these are good leadership tactics. What I bet you’ve never done is turn the tables on them to see how they respond to it.

I have. Because I subscribe to the theory that we all deserve to be treated right, along with the words of Dr. Phil who says “we need to teach people how to treat us”, I have given back what I’ve gotten from people, either those who thought they could tell me what to do or weren’t paying attention to their behavior.

Why did I do it? Because I adhered to the Dr. Phil theory first, which means I treated everyone the way I wanted to be treated, but some people couldn’t learn the lesson. Luckily, it didn’t happen all that often, but when it did I acted with intention, and each time I got my point across eventually. I tend to normally be very nice, but I can be a bit caustic when I feel I need to be.

Why did it work? Because I’d already established a baseline behavior, which I could change in a heartbeat. It’s hard for someone to complain about another person’s behavior towards them when almost everyone else is telling them how nice you are. lol

Don’t be that person who needs to be slapped across the face by being shown that you’re a jerk. Treat people how you want to be treated; really, can that be so hard?

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Whew! This is the last part in our series on succession planning and leadership diversity. Over the course of 3,769 words in 3 articles combined, I’ve hit upon a lot of beliefs and ideas on what it takes to not only create a culture where organizations hire the right employees and train them to be good at what they do, but to also learn how to evaluate talent using criteria that’s presently standard and some things that aren’t standard but should be.

diversity inclusion

Just to catch up, in case you missed the first three parts of this series, here’s the link to part one, the link to part two, and the link to part three. Let go ahead and finish this series with a bit more discussion than planning.

E. Closing Thoughts

1. Creating legitimate / large pool of applicants for all management positions

In the earlier posts, I talked about the need to create a succession plan so that organizations will have strong people who can take upper management positions that have the training and full understanding of the company culture. Whenever I put that type of thing out, it sounds like it’s going to be an exclusive club where only a few people might benefit from it.

In reality, if company’s follow all the steps I recommend (which they won’t because it’s pretty comprehensive), they should produce a plan that gives them a vast pool of talent… so vast in fact that some of those people might have to go elsewhere to have their shot. There’s absolutely nothing wrong with that; my proudest moments have always been when someone who worked for me was able to take a leadership position elsewhere because we didn’t have a spot for them.

By being inclusive, making sure women and minorities are part of the priority, one not only helps their own company but the community at large. Role models are in short supply in my opinion; an organization that looks like it’s taking the lead and contributing leaders within the community, even if those leaders are at other companies, strengthens their credibility in the marketplace; diversity always beats segregation.

2. Continual evaluation of promotion standards for current employees

Creating procedures and policies is only the first step in any process. The next step is making sure these things are always being updated. There isn’t a company in the world that doesn’t have some kind of change on a yearly basis. These are supposed to be living documents.

Also, with a succession plan, the idea is to see if the criteria for leadership changes with the times and the needs of the organization, while maintaining a process that still allows for women and minorities to have a fair shot at those positions. Even though we look at generational changes in 7 – 10 year increments, there’s nothing saying that a change in the deportment of candidates couldn’t change within a year or two.

3. Tracking the numbers

Statistics are crucial for every business and this area shouldn’t be any different. In part two, I told the story about a company that kept hiring the wrong type of employee based on a belief rather than what the numbers showed them. Data gives organizations the facts they need to provide a better product and to be profitable. The same processes need to be in place to see if your succession plan is working. If not, make changes that will be fair to everyone involved.

4. Make sure to not create a hostile environment

sid via Compfight

How could a hostile environment ever occur when you’re trying to make your process fair for everyone? It happens when someone believes they have talent that they don’t have and the evaluation process isn’t strong enough to either let them know what they need to do to improve or doesn’t give you the information you need to make an employee change.

When you factor in race and sex, things always get uglier. Anyone paying attention to news and history knows that whenever things aren’t going well, blame suddenly gets put on women and minorities and the belief that they’re getting special treatment because of who they are.

Setting people up to fail when you’re trying for a different result can come at any time if the leaders involved in the process aren’t strong or aren’t following established procedures. Don’t kid yourself; sometimes you’re going to entrust a leader to do the right thing without knowing that they don’t support your initiative.

5. Commitment from senior executives

Although I’ve always believed that a good leader can make a department strong no matter what other leaders in the organization are doing, reality tells us that no overall changes will be successful without the buy-in of upper management and C-suite level executives. All one has to do is look at how often group leadership training fails and evaluate it to see that everyone’s just going through the motions because upper management isn’t participating in the process.

It’s this reason why I’ve stressed that these executives have to have a hand in the mentoring process. This makes them a part of the policy and let’s them see how important and crucial succession planning is. Any upper management employees who can’t see the value in something like this are probably going to drag the company down… once again, as history has shown us.

6. Reaching out to the community

I told a story in part three about having to basically do my own recruiting in the community to get minorities to apply, then how I ended up having to hire the first minorities who weren’t in housekeeping or the cafeteria. I also mentioned that it helped open the floodgates to the point where, even though it wasn’t overwhelming, there were more minorities, including a disabled employee, than there had been when I first got to the organization.

As a consultant, something I’ve seen in my 15 years is that whatever talents I feel I have are accepted more by organizations that aren’t in my immediate area as opposed to those closer to home. I hate thinking that no one is ever seen as an authority if they live in a certain area, yet my own background has proven that.

Still, when people within a community attain certain levels of authority the word gets out, and the culture of both an organization and a community changes for the better. Imagine being known as the only big employer that not only actually hires more women and minority into leadership positions, but has a program that helps them become even higher leaders. What better publicity for a local organization can be better than that?

That’s all I have to say on this topic. I hope you’ve read all 4 posts related to this series. I’d love to know your thoughts and whether your organization with does this now or might benefit from thinking about doing it. As always, I’m available to help out… for a fee! 🙂

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Before we get going on this part of my conversation on succession planning, here are the links to part one and part two of the series.

office promotions

The next piece is going to talk about the importance of figuring out the criteria for making the decision to move someone into a leadership position while following your succession plan, and just how big these decisions can be, both for the organization and the community at large. Most companies don’t consider the impact their choices might have where their company is located but, trust me, the implications can be huge.

D. The First Promotion

Previously I talked about the need for constant evaluation of potential talent being promoted to leadership positions, thus starting the process towards mentorship and even higher leadership levels. Below is the context for what I touched upon before, and both what happens now and what needs to happen in the future as it pertains to thinking about the long term process.

1. Evaluating all sides to promoting someone to management

For the process of promoting someone to leadership, there should be three steps to consider. Their importance isn’t close to being equal, yet they’re all still critical pieces:

a) Job Skills

As important as this is normally, reality proves that this piece has always been given too much weight when promoting someone into a leadership position. Technical skill rarely translates into someone becoming a good leader. Often when people understand the work very well, their empathy towards others who might struggle drops. This explains why athletes with incredible skill and bonafides on the court often fail when given the reins when it comes to managing other players. Still, it helps to have someone with a good knowledge of the job the employees do being promoted to a leadership position.

b) Social Skills

This skill is hit and miss, mainly because those in the hiring process have a horrible understanding of what “social” actually means when it comes to leadership. Someone who might exhibit traits of what we call a “social butterfly” don’t fit well as a leader for most positions in business. If the person previously in charge was judged negatively because that person had problems getting along with others, the belief that having someone a bit more gregarious might seem to be a wise decision. Instead, it leads to hiring by extremes.

Working girl
Tramidepain via Compfight

I’ve always considered someone’s social skills based on how well they can work with other people within the department. Most of us know “that person” who everyone goes to for help, even if the supervisor or director is around. They don’t mind being asked questions, take the time necessary to help their co-workers, and almost never have anyone who complains about them in any way.

Those who fit the second category are often very good leaders, even if they still need mentoring and training to get to where you’re hoping they’ll be.

c) Potential Leadership Skills

Let’s say you’re pretty confident you’ve got someone strong on your radar based on the first two criteria of skills. You’re not done yet.

You might have to think hard about what else you’re looking for in a leader who you hope will help the company grow. For instance, I always kept my eye on people who seemed to go above the job they were hired for. Taking on special projects, or doing well if you need to tap them to do something out of the norm, is a great way of evaluating talent. Finding out that their knowledge actually extends beyond what you’ve taught them via training is another.

This is when you have to decide what great leadership is supposed to be. The way I see it, great leaders have vision; they’re not afraid to take chances; they trust the people they work with by giving them opportunities to show what they can do; they’re considerate of people’s feelings without pandering; they take care and support those who work for them. There are more qualities, but you can handle that one.

2. Different sets of circumstances

This particular criteria starts with the standard way people are usually promoted, then mentions two other areas that probably aren’t considered all that often… but should be.

a) What’s good for the department

This one seems obvious, even if that part is true the people hiring for this position fail more often than not. What I’ve seen is that the people who hire lower management positions often don’t know the job all that well. This means they’re going off gut feelings more than anything else; they’re hiring more for their needs than the needs of the department.

b) What’s good for the organization

This one is rarely considered, but it’s quite crucial for more reasons than just having a succession plan. The business world has changed to the point where fewer employees are taking jobs expecting to stay with those companies all that long. Companies have come to realize that as well, but instead of incentivizing their employees to want to stay longer they bring them in for their immediate needs and are already planning their replacement.

The organizations that seem to end up with better leaders are those who are able to grow and nurture talent from within. They find ways to make sure those people are challenged and shown their long term value to the company, and their loyalty is more often than not reciprocated. This is where great mentoring can come into play because organizations are always more than what new leaders see on the surface.

c) What’s good for the community

3dprinting Night - Majocchi
WeMake Milano via Compfight

At the last hospital I was at, I lobbied for HR to recruit more minorities to work in the hospital. I was the only one who wasn’t either in housekeeping or the cafeteria, yet there was a significant minority presence in the area. Because I couldn’t get HR to do anything,

I rallied a couple of minority employees in housekeeping to decide who they thought had intelligence and talent in their community and have them come to the hospital and put in applications, then let me know they had done so. I promised I’d make sure some of these folk would get calls when positions opened up. Of course, I ended up hiring the first two black people who weren’t in those departments (there had been at least one non-black minorities before I got there), and what happened next was kind of remarkable.

Minorities in the community had always heard that the hospital wouldn’t even call anyone in for positions they applied for, let alone been hired. Once I hired a couple, there were a lot more applications at both of the hospitals I was working at. By the time I ended up leaving, more people of color were working there, and the hospital also had its first deaf employee, all of which helped the hospitals mission because now the hospital didn’t have to call someone in another city to handle translations for them.

Truth be told, it took two years before I learned what my presence at the hospital had meant for the minorities living in the community, since I lived over an hour away. I’ve continued to see how that type of thing works. When people see others who they perceive are like them in high positions, they tend to not only see those organizations in a better light but also believe they have a fair chance to gain employment at those companies.

3. What’s Still Needed

Now let’s talk about the critical steps needed to be part of any successful succession plan. We’ve covered proper training and mentoring and a few other things. The rest are outliers that might need consideration, depending on both the person and the long term leadership goals of the organization:

a) More technical training

I think of this like the training starship captains get on Star Trek. They learn all aspects of starships so that in an emergency they can take on any role if need be, or at least know the proper questions to ask when things start going wrong.

I liken this to my early training at the first hospital that employed me. I was in billing, but over time I learned auditing, verification, collections, admissions and emergency room processes. I was also familiar with the department that did the scanning, a process that was in its infancy in the 1980’s yet I knew how to do it if I’d ever been called on… which luckily I wasn’t. lol

The more your potential leaders know about the organization, the more valuable they become and the more valued they feel. Never let the learning process end, especially if the person is willing to learn.

b) More leadership training

I’ve heard the lament from a lot of directors about leadership training, saying “we have this every year and it’s always the same thing.” The real reason there’s leadership training every year is because upper management doesn’t do any followup after the sessions to see if managers are applying any of the concepts they learned during the training.

Once you decide to invest in an employee, you need to be prepared to go all the way. This means not only teaching them the ways you want them to lead, but allowing them to participate in outside training programs and even encouraging leadership courses at local colleges. No two leaders do everything the same, yet all good leaders follow the same principles. People buy into something when they can fully embrace it.

c) Continuity of mentoring

Mentoring is going to be big when it comes to training new leaders. Some of these ideas I’ve mentioned previously but not all of them in the same way I’m going to talk about them now:

1) Co-Workers

Learning how to work with co-workers gives new leaders great training, both in what to do and what not to do. Some of their peers will have the skills that they want to learn and you want them to learn, while others will be deficient in one or more areas that they also need to see. How they work with others will give you another way to evaluate their skills and qualifications for upper management while also offering you a way to possibly figure out what else they might need.

2) Upper Management

I can’t stress this one enough. Not only does upper management have to buy into the plan but they’re going to need to be willing to show these potential leaders the way to address issues, even when they might not be all that sure themselves. I talked about this in part two; not only upper management within their own departments, but from the C-level will make significantly positive impacts of the thinking and loyalty of your leadership candidates.

3) Executive Coaching

I haven’t talked about this one yet but it could be a lifesaver for any organization. The last study showed that 40% of Fortune 500 CEOs use executive coaches and other strongly positive ROI numbers associated with executive coaching in general. Another way of looking at it is these coaches being more like mentors for your employees, since sometimes people in management need someone else to talk to that’s not part of the organization.

4) Professional Organizations

I mentioned this one in part two; technical and trade organizations exist in all types of forms, and it’s not only good for helping to train new leaders but helps them with networking and business social skills. It’s a great way of interacting with peers who do the same type of work they do, and I’ve found that often there are some highly regarded members who might make great mentors for them, which can only benefit your organization on the back end.

Only one more part to go, and I promise it’ll be much easier to take in and read more for pleasure than as a learning tool. 🙂

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In part one of my succession planning for leadership diversity series, I gave a preamble as to why such a thing should be a necessary process in all companies. The next stage is to talk about the process of creating a workable plan towards that goal.

C. Creating The Initial Plan

1. Setting the Goals

goal setting

No plan works without first deciding what the ultimate goals are. In my opinion, the first goal should be in training leaders who understand your industry, your company and the types of employees you’re looking to hire and work with. After that, if there’s anything else you’re looking for to lead your company to greater heights, you can tailor your goals for that.

2. Hiring The Right Employees

This is the most critical part of the entire process for more than one reason. The first is that it costs a lot to hire someone and keep them at least through the probationary period. The second is that many companies hire people based on the wrong criteria. The third is that sometimes people are hired who aren’t a proper fit for the environment they’re going to be put into. Let’s take a look at some of these areas.

a) Criteria for Hiring

I’m going to base this part of the article on the criteria I set up in my Mitchell Employee Evaluation Module. I list the 3 areas of evaluation criteria as follows:

* Technical Skills
* Social Skills
* Unskilled Criteria

Unlike most company processes, this equates to 47 specific criteria that companies can decide upon to help them throughout the hiring and interview process. Whether you check out the module or set something up for yourself, my recommendation is to come up with anywhere from 5 to 10 criteria you want in any candidates you’re looking to hire.

Now let’s dig a bit deeper:

1) Based on Education

I hate this specific criteria, although I understand its use in eliminating a number of candidates you might feel aren’t qualified to do the work. However, I’ve found that a lot of people who scored the highest grades in college aren’t always the best people in relating to others.

2) Based on Past Experiences

This one is hard if you’re hiring people right out of college because what kind of real experience could most of them have to show you their leadership skills unless they were in athletics? If you’re hiring someone with at least 5 years of work experience this might work better for you, but it’s going to be difficult getting information out of previous employers to ascertain this one.

3) Why a feeling may or may not be sufficient

Although it only happened once, one of the best feelings I ever had about someone turned out to be the worst hire I ever made. The thing is, I had a couple other directors in on the interview with me and she fooled all of us.

That one mistake notwithstanding, everyone else I’ve ever hired has worked out wonderfully. Of course, having criteria to fall back on helped a lot, although I didn’t have that specific criteria early in my career. That’s why I recommend writing down and following what you believe you need for both regular employees and long term prospects for leadership; sometimes you can’t trust your own judgment.

b) Placing employees in a fair environment

Kodomo Kai Kids
Matthew Kenwrick via Compfight

The story I like to use for this one is remembering a large downstate New York company that always sent its recruiters to California to hire people who were at the top of their class in mathematics and engineering. Oddly enough, most of those people happened to be Asian… and I mean Asian, not Asian-American.

The company would hire these people based on their college grades and then ship them all the way across the country to work and live in a community that didn’t have a significant Asian population. This was the culture the people they brought over were used to. Not only that, but every year almost all the new employees they hired left to go back home, so there weren’t even a significant number of other Asians working in that company’s location.

In an environment like this, neither the employees or the company could succeed, and it took 5 years of doing this before management realized they needed to change their criteria because of the cost of hiring so many people who weren’t prepared for such a change in their lives.

3. Training and Evaluation

I’ve always been big on two things: written training and procedure processes and consistent and fair evaluations. I don’t see either of these all that often, and that means employees are either set up to fail or evaluated on what they’ve done lately instead of a body of work.

You can’t have good employees without good training; without good employees, there’s no chance to have a pool of people to consider for any succession plans. This means:

a) Evaluating training methods

Not only do you have to have training methods that are solid, but you need to test them to make sure they’re always proper, because things change.

b) Follow up on training

Even if you know your training processes should work just fine, you need to remember two things as it relates to the employees:

1) Evaluation of performance – you need to evaluate employees more than once a year; otherwise, you have no idea if they’re competent or not;

2) Continuous training – training never stops because processes are always changing. Even if you have to send people outside of the organization for more education, it benefits the company.

c) When trying to be fair breeds inequality

fairness and equality

I’m someone who always says that trying to make all criteria equal isn’t fair to those whose background might mean they learn and process information differently that everyone else. What I say less rarely yet is equally important is that even if this is something you should consider, it should be a consideration in the context that your efforts to be fair don’t create a visible bias in the wrong direction. No matter what you do, there’s always someone watching to make sure they’re being treated fairly, even if what you’re doing is none of their concern.

4. The Support System

Whether it’s general employees or candidates for management, there always needs to be a support system for them to thrive. These are the areas where upper management needs to take charge and help HR or whomever make the proper moves for the ultimate success of an organization:

a) Other Employees

There’s a place for camaraderie as far as departments and teams go but once someone has been deemed to be leadership material it’s going to take someone at a higher level to guide them the proper way.

b) The Manager

This is the obvious initial candidate for the job, unless the manager you have in place doesn’t exhibit the skills needed to groom someone properly to become a leader (remember that 85% I mentioned above?). This is a problem for companies to begin with but it might be difficult to make the proper changes at this level if there are a lot of mid-level managers and not enough really good candidates to fill the positions (another good reason for succession planning).

c) Mentors

Mentors are always a key and it doesn’t have to be overly obvious that they’re around until necessary. For instance, even though I mentioned my overall mentor above, I actually had two other people who were crucial to my gaining knowledge and a little bit of influence when I was working my first job.

One was the vice president of the department I was working in. The other was a C-suite executive who used to talk to me all the time and who’d give me tickets to go to the opera, which afforded us time to talk both before and after performances. I hadn’t even realized I was being mentored at the time, thinking that somehow he just knew I liked opera. 🙂

Let’s answer the two questions below:

1) Why Mentors

Mentors are the people who know what’s needed to be at a higher level, the types of skills needed and the type of personality that’s part of the organizational culture.

2) Who Should Mentor/Options

This one is a lot tougher to define. It’s probably not going to be a CEO or the overall VP of the company, and if the organization doesn’t have a lot of upper management and C-suite level employees it’s going to take a lot of thought to get proper people involved.

In general, the people who should be a part of it are those at the top level of each department, or people they and upper management trusts who sees something in an employee that might benefit them in a different area of the organization. In some circumstances a company might decide that someone on the outside would make a proper mentor for those employees.

I see this happening more often if the employee is involved in sales or marketing and those at the top level of the company believe that employees technical and leadership skills could be enhanced by working with someone like that. It’s rare, but I’ve seen it happen, though it takes a lot of trust between all parties.

d) Organizations

I tend to believe that there are some great trade organizations in the world that can offer education, training and mentorship outside of the company. Every budget should contain enough money to allow qualified candidates, which should include all employees, to join these groups and participate in the training.

The true importance of organizations like this are:

1) Camaraderie

Sometimes it’s easier for people to talk with those outside the organization about their issues and problems, especially if they might be the only one who does what they do where they work (for instance, there’s only one director of patient accounting at each hospital and there’s rarely anyone else working in the hospital for them to talk to for ideas about improving processes).

2) Certifications

Although not every company is concerned with every certification available, it allows employees to build up a nice resume of success based on their particular vocation and that criteria will help bolster those employees as far as either their technical or leadership skills are concerned long term.

This looks a bit complex, doesn’t it? Creating leaders isn’t easy work, but it’s necessary for companies that care about their long term success.

What; you thought we were done? Nope; two more sessions to go!

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