Your company just announced a merger: What do you do now?
Your company just announced a merger: What do you do now?
Prepare yourself now, and come out on top
A merger is an almost inevitable event in most hospital-based home care company managers' careers now. Unfortunately, administrators are in the bull's eye when it comes to suffering stress and being susceptible to losing their jobs in a merger.
You can position yourself to come out on top by preparing yourself now to manage a merger. Hospital Home Health asked veterans of mergers for advice on how to survive and even thrive during consolidation. This is what they say:
* Don't jump ship too quickly.
When a merger is first announced, don't make too hasty a decision about what the consolidated company will be like and whether you want to work for it, says Cynthia Tyger, RN, MBA, CNAA, the director of home health for Pinnacle Health System in Lemoyne, PA. Her company lost some good employees to this type of fear-inspired reaction to the announcement of the merger, she says. (See accompanying article on calming staff members' fears during a merger, p. 63)
Instead, stick around through the ambiguity, even if you're also looking for work elsewhere. Once the merger begins to shape up, you'll have a better idea of what the new company will look like, and you'll be able to decide whether you want to leave then. Anyway, you're bound to meet with the same situation at another company if you do leave, as consolidation is the norm in home care now, Tyger says.
* Don't get angry, or at least don't show it.
"If you get angry and try to fight against the merger, you'll only burn bridges," says Judy Walden, RN, MHA, the president and chief executive officer of the Visiting Nurse Association in San Diego, CA. Walden announced last month that she is inviting other VNAs in her region to consider being a merger partner with her.
Instead, channel your energies into being a good leader, and help your company and its employees get through the merger, she advises.
* Evaluate the culture of the merging organizations.
Think about the quality of management that the new company will have, Tyger advises. You have to try to evaluate the culture of the merging organizations to determine whether the new culture will be one you want to work in. Are the employees of the company you're merging with happy?
"I put a lot of emphasis on what the CEO was saying and how he said it," Tyger says.
Also, think about the new consolidated company's position in the community, Tyger says. Does it look like the health system will be well placed to be the future health care leader in your community?
* Ask yourself whether you want to be in top level management.
Do you want to stay in management? Do you want to be at the top? Or would you rather avoid the pressures of the changes in the home care industry and go back to or stay on the clinical side? These are questions you need to ask yourself right away when a merger is announced, says Tyger.
This is what Tyger did when her hospital-based home care company and hospital merged with another to form Pinnacle Health System earlier this year: Tyger had been the director of nursing for one of the two home care companies, and now heads up all of Pinnacle Health System's home care operations. Of the former directors of the original two home care companies, one left the company, and the other chose not to apply for the new director of home care position.
Know what your options are
* Brush up your resumé.
When a merger is first announced, you probably won't know whether you'll end up working for the new, consolidated company, so keep your resumé fresh, just in case you need it.
As soon as Laura Waltrip, RN, the former chief operating office of SantaFe HomeCare in Gainesville, FL, learned that her company was considering merging with another provider, she began circulating her resumé right away and networking with industry colleagues.
"I needed to know what my options were while I waited to see what the new company would be like," Waltrip explains.
But she ended up taking one of the top positions -- area executive director -- with Shands HomeCare, the company that merged with SantaFe HomeCare.
* Update your skills.
Many home care agency directors lack an understanding of basic business operations and management, says James J. Turri, MS, MBA, senior vice president for outreach services for the Susquehanna Health System in Williamsport, PA.
Susquehanna Health System was created in August 1995 when three hospitals and their affiliated corporations, including two home care companies, joined to form an alliance. Turri's duties include overseeing Susquehanna Health System's home care, durable medical equipment, infusion, pharmacy, and private duty nursing companies, as well as some aspects of hospital management.
To survive as a manager in the changing home care industry, home care directors must have an understanding of finance and accounting, Turri says. These are some skills home care administrators must have:
* knowledge of cost accounting;
* ability to identify a cost-effective way to deliver quality services;
* ability to explain to your staff what you can change -- how and why -- to cut costs;
* understanding of different types of insurance;
* understanding of managed care;
* comprehension of billing processes;
* knowledge of basic business operations and management, including a breakdown of your costs per visit, discipline, service, admission, and geographic area.
"Even if you're not doing all of these things, like billing and managed care contracting, you must be able to understand it, converse about them with your superiors, and make your staff members understand it," Turri says.
If you don't have the business skills you need, such as an understanding of finance and accounting, you should consider taking some classes in those areas or getting a master's degree in health administration (MHA), business administration (MBA), or public administration (MPA), Turri and Tyger say.
You need these skills to be able to talk to people in your health system's finance department and understand each other, Tyger says.
"For instance, right now we're going through the budget hearings at my company. I have to be totally conversant about this," Tyger says. She got her MBA part time while she was still the director of nursing at her company before the merger.
Show that you're a cost cutter
* Shed any aversion to cost cutting.
Thinking that quality of care cannot possibly be maintained while cutting costs can make hospital-based home care agency directors appear unattractive as management candidates during a merger, Turri says.
"Too much focus on patient care to the detriment of cost efficiency is very common," Turri says.
* Demonstrate your abilities throughout the merger process.
The time between when you learn that your company is planning a merger and the actual consolidation is your chance to showcase your management abilities to your hospital or health system executives.
Whether you end up staying with the company, you want to make your company look good, and this will reflect well on you, Waltrip says. This means you should help facilitate the merger as much as possible. Put yourself into situations where you are able to talk about and show your skills to your hospital executives.
One way to do this is to ask your hospital's top executives, "What do you need me to do to make things go well?" Walden says.
Another way to demonstrate your managerial skills is to show that you can adapt quickly to the daily changes that are ongoing. For example, you can prove to your hospital CEO that you have good management skills by overseeing tasks such as rewriting admissions forms without having to go through a six-month forms committee process, Waltrip says.
"The purchaser will want leaders for the consolidated company who can demonstrate that they can balance the big picture and the details," Waltrip says.
* Identify who your change team members will be.
Once a merger is announced, you should go to work right away identifying the key people in your organization who will help you bring about the transition to a consolidated company. You will need three types of people, Waltrip advises:
-- those who have their fingers on the pulse of the company and the industry to serve as role models for the rest of the company;
-- those who have strong systems analysis and process identification skills to actually combine the merging companies' different business functions;
-- those who will be cheerleaders, to set the tone and promote enthusiasm for the transition.
Once you have identified those people, meet with them to tell them what strengths they have that you need, and ask them for their help in merging the two companies.
* Negotiate a fair severance package if you decide to leave.
As part of the merger, you have the right and the duty to yourself to negotiate a decent severance package that includes executive outplacement, Walden says.
If you know from the beginning that you're not going to stay with the company, then consider offering to serve as the transition leader on a consultant basis until the merger is complete.
"Make them take care of you," she says. *
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