1. Schaffner, Marilyn PhD, RN, CGRN
  2. Schaffner, Jim MBA, BSCE, PMP

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Several years ago, a former supervisor said, "It is easy to lead when money is plentiful." It is yet another story when times are tough. Just over a year ago, the unemployment rate was 4.5%, the Dow Jones hit a record of 14,000, and Americans were spending money on new cars, vacations, etc. (Seifert, 2008). In the past few weeks, the crises in the financial markets reached such great heights that it led to enactment of the Emergency Economic Stabilization Act of 2008 (Holt, 2008).


Healthcare organizations are no longer immune from economic downturns. Healthcare organizations are not recession proof. Many organizations are facing shrinking reimbursement, limited access to capital, increased costs of that capital, and flat or decreased volume leading to drastic cost-cutting measures including layoffs. John C. Maxwell says: The pessimist complains about the wind. The optimist expects it to change. The leader adjusts the sails (Nowak, 2008). Who is the leader that "adjusts the sails"? What breed of leaders are needed amid times of economic challenge?


Strong leadership requires management of the important but tough decisions. Today's leader must focus on improving financial performance through more productive and judicious labor and expense management (Holt, 2008). This may include developing a variable workload standard and staffing plan that matches staffing to patient volume demands. If flex staffing is new to the organization, allow time for staff to mourn what was and adjust. Help them understand the need for the change.


Transparency is essential during these times of challenge. Tell it like it is. Staffs will more likely "get on board" if they know the background and the reasons for change. Set goals and provide monthly reports on the organization's financial status and productivity that can be understood by all. Provide quality reports that reassure staff that changes have not impacted the quality of patient care.


Maintain an even keel. Boarding a plane recently, a young man wore a T-shirt that read "wag more, bark less." These challenging times can cause leaders to want to bark more and wag less, but a positive attitude will help you see more possibilities. A positive spirit will help you turn possibilities into probabilities.


Be a good listener and hear what is being said. Some of the changes to decrease expenses may erode staffs' sense of trust, and leaders must respond with clearly defining the changes and creating opportunities to talk with staff (Mohrman, 2008). When times are tough, staffs ask tough questions. It is imperative for leaders to remain accessible to answer the tough questions and quickly dispel rumors.


Consistency is a must. Steadfast adherence to the same principles, course, and form must be applied organization-wide. Lack of a consistent standardized approach will create a "we/they" situation.


Be aware of activities that may be construed in conflict with the organization's goal of decreasing expenses. Staff will despair if leaders are allowed to travel long distances to attend costly conferences while they are cutting expenses at the unit level.


Ask staff for their ideas for new approaches to improve efficiencies and decrease costs. Encourage self-designed local ways to operate more productively (Mohrman, 2008).


Wisdom is the collective knowledge gained from past successes and failures and the application of that knowledge at the right time. Be a wisdom leader during these times of economic challenge.




Holt, M. A. G. (2008). Hospitals' response to the current financial market. IMA Insights, 6(11). Retrieved October 31, 2008, from[Context Link]


Mohrman, S. A. (2008). Leading change. Leadership Excellence, 25(10), 5. [Context Link]


Nowak, M. (2008). The leader adjusts the sail. Ezine Articles. Retrieved November 11, 2008, from[Context Link]


Seifert, E. (2008, October 19). We got change in 2006; can we stand more of it? [Editorial]. The State Journal and Register. [Context Link]