Leadership Development is a Growing Concern in Healthcare

April 1, 2021
April 1, 2021

Healthcare providers are functioning in a landscape that seems to be reshaped on a daily basis. While attempting to adjust to the explosion of healthcare reform, new regulations, performance standards, payment structures, ever-changing technology, and myriad other requirements, there remains the need to provide care to patients – and to do it perfectly every  time.


With an aging demographic in leadership positions in healthcare, organizations are beginning to experience a shortage in the leadership talent they need to set direction, create alignment, and gain commitment among employees, partners, and stakeholders as they seek to provide that safe, high-quality patient care.

Nurses and nurse leaders specifically are leaving the profession at a time when their experience and leadership skills are most sorely needed.  By some reports, 75% of current nurse leaders plan to retire by 2020.

As the landscape changes shape, those changes require a greater need for leadership at the very time there is significant attrition in the ranks of clinical leaders.


Against the backdrop of the imminent retirement of nurse leaders in the next four to five years, Modern Healthcare (July, 2016) predicts that:

Of the 20 healthcare occupations with the most job openings over the next decade, registered nurses jobs top the list with a projected 1 million new and replacement openings over the next 10 years.“

Similarly, Becker’s Hospital Review in a 2016 article predicts the supply-and-demand crisis will likely worsen in years ahead:

“By 2024, healthcare will be the largest employer in the nation, with job openings totaling nearly 5.2 million, including more than 1 million nurses… Healthcare systems are already struggling to fill their job openings today. In fact, the ratio of job openings to job hires is currently about 2:1, with nearly a half million open jobs going unfilled, according to the U.S. Bureau of Labor Statistics. The result is a stiff competitive market for qualified professionals, sometimes referred to as a war for talent in the healthcare industry.”

From a talent-availability standpoint, it is already a seller’s market. From a leadership standpoint, the condition will become critical.


The complex reality of today’s healthcare environment is apparent. From a torrent of new regulatory requirements and compliance standards to newly-introduced payment schemes, the healthcare workforce at every level is aware of the avalanche of pressures on them to perform their jobs more efficiently – without sacrificing quality.

It is a daunting task just to keep up with changes. Well prepared, new leaders are essential for navigating this ocean of change, whose characteristics will include:

REACTIVE CLIMATE: We are in a reactive healthcare climate where every hospital employee feels the effect of almost daily change in how their work is measured, managed, and regulated.

SUSTAINED PRESSURE: There is unrelenting pressure on employees to get it right 100% of the time -- no room for error. For example, the CMS patient experience payment structure holds every hospital employee to the “Always” standard of service delivery.

APPARENT CONTRADICTION: A change-heavy environment often leads to contradictory priorities. Hospital employees, whether they verbalize it or not, wonder on a daily basis – what is our priority supposed to be today?

RESOURCE CONSTRAINTS: There is resource uncertainty due to how hospitals get paid, how much they’ll be paid, and when that payment will be made. This uncertainty can affect daily decision-making in an organization - which in turn can affect employee morale and confidence in the direction of leadership.

CULTURAL DEVALUATION: The mantra today in healthcare is “do more with less” – a punitive formula leading inevitably to workforce frustration and burnout.

These realities will not change and will likely only intensify in the future. Tomorrow’s healthcare leaders must be prepared to lead in the midst of regulatory and market forces that have already been set in motion today.


Tomorrow’s leaders in healthcare will not appear out of thin air, out of some unseen deep pool of talent ready to surface when needed. There is no “just-in-time delivery” of new leadership talent. Hospitals will not be suddenly blessed by an influx of professionals who ride in over the horizon with the intrinsic talent to motivate, manage, and inspire. Tomorrow’s leaders must be developed today. Nor will they come from other industries. They will be healthcare people from within healthcare organizations who understand the challenges, frustrations, and rewards firsthand.

A hospital’s culture is its personality, and its leaders embody that personality. High-potential employees who are already a part of the organization know the culture and understand how they fit with the culture. Developing those leaders now is imperative and will lead to:

PROACTIVE LEADERSHIP: In a reactive healthcare climate, skilled, proactive leaders will guide employees through the effects of daily change, helping them to make sense of how their work is measured and managed.

CONFIDENT MODELING: Amidst the pressure on employees to get it right 100% of the time, with no room for error, confident leaders convey that they have been there, done that and that this challenge can be met together.

INDIVIDUALIZED PREPARATION: Tomorrow’s leaders will be encouraged to
develop themselves in areas related to their innate interests and abilities, as well as in time-tested core leadership principles. People gravitate toward leaders that effectively teach others to trust their instincts to do the right things in the right way.

WISE INVESTMENT: Especially in a climate of constrained hospital budgets, investments must be made wisely. There is no investment more important than the development of leadership talent that will sustain the organization of the future. Penny-wise, pound-foolish is not the formula for success in leadership development.

RESOURCEFULNESS: If today’s mantra today in healthcare is “do more with less,” tomorrow’s will likely be “do even more with less.” A skilled leader is one who has lived the challenges, knows how to manage in a reductive environment, and can still effectively motivate and engage employees at all levels of the organization.


The foundational principles of HealthStream’s Leadership Development are (1) Assess current skills, aptitudes and confidence levels; (2) Identify learning opportunities that either fill gaps in knowledge or enhance current skills; and (3) Develop future leaders following a well-crafted leadership development approach. These elements, each with its own particular focus, work in a mutually complementary fashion.

Learn more about our Leadership Development solution here.

Now is the time for hospitals and healthcare organizations to position themselves for the future. People in healthcare know better than anyone that these are challenging times. But challenging times are when strong leaders rise to the occasion. HealthStream Leadership Development clients have accepted the challenge and are taking the lead in developing tomorrow’s healthcare leaders.

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