MANAGEMENT RECRUITING: INSIDE VERSUS OUTSIDE
Many managers in many organizations praise the value of promotion from within, filling open positions with employees who see such moves as either stepping upward or entering into more preferred jobs. And there is no denying that higher management's obvious preference for internal development is seen as a plus by many employees; it has long been known that visible opportunity for promotion and growth can figure strongly in employee retention.
Perhaps, however, even promotion from within can come to be regarded as too much of a good thing. As one middle manager proclaimed, "All management positions here are held by people who started at the bottom and came up through the ranks and have worked together for years and years. Wouldn't it be wise to now and then bring in some outsiders, especially in the more responsible positions?"
While bringing an occasional "outsider" into an organization's management ranks is wise, such wisdom is not more pertinent to top positions-those "more responsible positions"-than to management positions at all other levels. Even without initially intending to recruit externally, those who recruit top administrators are more likely to fill hospitals' top positions, rather than most other management positions, with outsiders.
In first-line and middle management, management positions are the most numerous and turnover-at least numerically, if not in terms of percentages by job category-is greatest. A case can be made for filling some management positions from outside while filling most through internal promotion. Each approach has its advantages.
Promotion from within offers the following advantages:
* It fulfills the need of employees to see real opportunity for promotion and growth within the organization. Many who aspire to management will remain with the organization if they see others moving upward. Seeing promotion from within actually occurring is a positive motivator.
* The internal candidate is readily available, enhancing job continuity at little or no recruiting cost.
* The internal candidate already knows much about the organization's tasks and methods and is already acquainted with many of its people.
* The known insider is ordinarily perceived as less of a threat than the unknown outsider.
Advantages also exist, however, in occasionally looking outside for a new manager.
* The outsider frequently brings fresh ideas and new approaches into the organization.
* The outsider does not face the potential problems posed by existing interpersonal relationships that the insider may face. The outsider can enter with no personal likes or dislikes concerning employees, no biases of the kind that can arise from prolonged familiarity, and generally no barriers to extending equal regard to all people in establishing new interpersonal relationships.
* In seeking an outsider, the organization can look for specific technical strength that may not be available inside or can call for proven success in management if necessary.
* Once having conquered employees' natural fear of the unknown, the manager from outside may possess more credibility than one who has been regarded by employees as "one of the gang." The outsider is more likely to be seen as a true manager right from the start.
Total reliance on promotion from within can lead to inbreeding of management style as all managers respond to the same kinds of role models and learn the same patterns of behavior. In the long run, this leads to management stagnation.
On the other hand, overemphasis on external recruiting can lead to management instability as varied management styles continually clash. Demotivation among employees often occurs, followed by increased turnover as employees experience limitations on upward mobility. The instability and demotivation contribute to a general feeling of insecurity that will likely be shared by many employees.
Espousing and practicing a policy of promotion from within is generally healthy for an organization. Realistically, however, not all management positions can appropriately be filled from inside. On the other hand, automatically filling all management positions from outside can be harmful to an organization. A combination of promoting from within and hiring from without is required. This practice ordinarily favors inside candidates, but some outside candidates will also be recruited. Organizations require insiders' contributions to provide continuity and stability for effective day-to-day functioning; however, outsiders' contributions of new ideas and fresh approaches are required for long-run success.
In the way of additional information and advice, this issue of The Health Care Manager offers the following articles for consideration:
* "Hospital In-house Laboratories-Examining the External Environment" addresses the environmental factors affecting the ability of hospital laboratories to become profit centers and thus be positioned to function as sources of additional revenue to their parent institutions.
* "Medical Response Planning for Pandemic Flu" reports on a quantitative research study involving hospitals having airborne infectious isolation rooms undertaken to evaluate the health care infrastructure necessary to provide medical care in US hospitals during a flu pandemic.
* "Critical Access Hospital Chief Executive Officer Turnover: Implications and Challenges for Governing Boards" addresses some problems essentially unique to small rural institutions categorized as critical access hospitals, specifically the negative implications of chief executive officer turnover.
* "Consumer-Directed Health Care: Understanding Its Value in Health Care Reform: Part I" addresses the importance of consumer-directed health care as an essential strategy in the effort to reduce health care costs and enable significant strides in health care reform.
* "Trust: The Sublime Duty in Health Care Leadership" addresses trust as the most basic fundamental quality for effective leadership, suggesting that it is an essential task of leadership to establish a culture of trust within the organization and to remain constantly aware that trust must be established over time but can be lost in an instant.
* Case in Health Care Management: "I'll Get Around to It" asks the reader to develop some advice for a manager who regularly experiences nonspecific and perhaps marginally insubordinate responses from a particular employee who exhibits a seemingly casual attitude toward certain work instructions.
* "Your Workers May Be Contingent, But Your Liability for Them Is Certain: Part I-Employment Status and Fair Labor Standards Act Issues" is the first of a 3-part treatment of the legalities and practicalities of utilizing contingent workers-independent contractors, temporary agency workers, leased employees, and such-to keep labor costs under control while maintaining the staff necessary for quality patient care.
* "Factors Associated With Financial Distress of Nonprofit Hospitals" reports on study findings suggesting that decrease in occupancy and increase in Medicaid payer mix, health maintenance organization penetration, market competition, physician supply, and percentage of elderly served are associated with the increased likelihood of financial distress in urban hospitals.
* "Allied Health Students' Perceptions of Effective Clinical Instruction" reports on a study undertaken to examine the teaching abilities and professional development training needs of clinical supervisors as suggested through the perceptions of allied health students, culminating in recommendations for continuing education courses for clinical supervisors who serve as instructors.
* "Cardiovascular Supply Cost Negotiations: Partnering for the Future" recommends the establishment of a logical and resolute approach to obtaining supply pricing that maximizes cost-saving opportunities, buffers against escalating technology costs, and preserves clinicians with full access to all that is required for the continued delivery of quality care.
* "The Impact of Education Regarding the Needs of Pediatric Leukemia Patients' Siblings on the Parents' Knowledge and Practice" reports on a study undertaken to determine the effect of educational intervention on parents' knowledge and performance related to the social needs of the healthy siblings of pediatric leukemia patients.
* "HIPAA: SOP-HIPAA as Standard Operating Procedures" suggests that the appropriate way to manage the demands of HIPAA-the Health Insurance Portability and Accountability Act-is to incorporate compliance with the law into the everyday standard operating procedure of the organization.
* "Self-management: Key to Success as a Manager" suggests that the individual who will eventually best manage the activities of others is the person who becomes proficient at self-management and that the successful self-manager will be the manager who is able to embrace necessary change and alter old habits.