One of England’s largest hospital trusts, Imperial College Healthcare Trust in London, is to be run by an “office of the chief executive” consisting of medical director, finance director and the chair. What are the implications of working without a chief executive and is this putting too much power into the hands of the chair? Is this the beginning of the end for chief executives?
‘The short tenure of chief executives is further evidence of the increased tension between the roles’
The relationship between a chief executive and the chair of the board can be a very powerful partnership. However, in recent times there has been a blurring of roles. Chairs and non-executive directors have increasingly been appointed because of their financial or commercial background. They are less likely to defer to directors of finance, are more comfortable with the business-like direction of the NHS and more likely to challenge public sector attitudes to pay, conditions and absenteeism. Recent hospital scandals have made it clear they should be concerned with care issues, not just the budget.
So if the chair and non-executive directors are appointed because of their business expertise and expected to take an active oversight of staffing issues and patient care, as well as performance and budget management, it’s not surprising that some chairs might question the need for a chief executive.
Loosen the reins
In fact, some non-executive board members may consider the post of chief executive as an obstruction, a barrier between them and direct contact with the medical director, finance director, head of HR and other senior managers they want to talk to.
‘The system works on checks and balances, if you remove or downgrade the chief executive’s post you upset this’
Appointed because they are ideologically in tune with the government’s vision for the NHS, these chairs and non-executives have no trouble with the notions of competition, performance rewards and greater privatisation.
The short tenure of chief executives is further evidence of the increased tension between the roles. There is an argument for gaining greater stability and consistency by making it clear that the chair and non-executive directors hold the vision for the organisation; they are responsible for the culture within the organisation and it is the chair who will take the lead in building relationships with other organisations.
The system works on checks and balances, if you remove or downgrade the chief executive’s post you upset this. I worked in one of the big local authorities at a time when they decided to downgrade the post of chief executive and replace it with a head of paid services. Some departments looked forward to less control from the centre believing it would be easier to protect their budgets if the corporate shackles were removed. We became less corporate as an organisation and less effective in influencing the wider agendas. A series of audit and inspection reports highlighted this as a weakness and the post of chief executive was reinstated.
Make the business case
As a director I viewed the chief executive as a source of professional and personal support. If a board member was placing me or one of my managers under undue pressure or acting unethically it was reassuring to know I had their support.
It begs the question of what would happen if the chair of the board was in sole charge? As a director I was asked on many occasions to produce a business case to support a desired political decision. There’s nothing wrong with the board responding to public pressure and making a political decision to keep a department open or retain a service in house even though this is a more expensive option.
Likewise outsourcing services has its risks, some contracts that hospital boards have enthusiastically entered into with the private sector have certainly turned out to be very costly and very difficult to get out off. The chair and board want their ideological preference to also be the option that has the strongest business case. This happy coincidence does not happen as often as they would like and it is the chief executive’s job to manage through this scenario.