Morale Boosters Gone Wrong: Costly Mistakes Practices Should AvoidApril 3, 2014 by Melissa McCormack
Like any business, a physician’s office functions best when its employees are happy and engaged. Yet a 2013 CareerBuilder Health survey found that 60 percent of medical office workers report being “burned out.” Burnout often leads to turnover, which can be extremely costly—a 2013 report from the American Academy of Family Physicians (AAFP) estimates the average cost of replacing a single family practice doctor is $250,000.
Boosting morale can mitigate the risk of burnout and help combat turnover, and much has been written about what practices can do to foster improved happiness and confidence among staff. But good intentions don’t guarantee success—actions by well-meaning practices can sometimes have unintended, negative consequences.
I spoke to several practice management experts to find out which morale-raising tactics are the biggest recipes for disaster, and why. Practice managers and owners, here’s what not to do when trying to boost your team’s spirits.
Staffing Efforts Gone Wrong
At its core, morale centers around people—your staff—so it stands to reason that many practices trying to improve morale focus on the hiring, firing and management of these people. But even the best laid staffing plans can backfire.
Promoting Under-qualified Employees From Within
Like professional organizations in many sectors, medical practices often make a habit of promoting from within, sometimes with the explicit goal of increasing employee satisfaction. After all, employees like to know their jobs afford them growth opportunities.
But proceed carefully, warns Brian White, managing partner of Competitive Solutions, a consultancy that helps grow physician practices. He says that a track record of success in a lower-level position isn’t necessarily a predictor of how a candidate will perform in a managerial role, because the skills required for success in each can be vastly different. A solid history with your practice doesn’t necessarily mean an employee is ready to move up.
Marc Lion, CPA, CFP, founder of Lion & Company, CPAs, LLP and a member of the National CPA Health Care Advisors Association, echoes White’s concerns. Ultimately, Lion says, promoting the wrong individual to any position of authority can cost your practice a lot of money. It’s also a problem closely related to another staffing issue Lion brings up—keeping poorly-performing employees on staff.
Not Terminating Bad Employees
Practice owners are often hesitant to terminate employees for fear of seeming cold or heartless, particularly if they run smaller, close-knit practices. Many fear that a “firing” may create an atmosphere of stress or negativity, and sow discord among remaining employees.
In actuality, however, retaining an employee who isn’t good at their job can have a far more negative impact. One “bad” employee can bring the entirety of the staff down, Lion says, because you’re essentially setting a standard of poor performance and demonstrating that incompetence or insubordination can be ignored (or even rewarded).
As mentioned above, having an employee in the wrong place—whether due to promoting someone who isn’t the right fit, or keeping on someone who consistently underperforms—can cost your practice serious money.
Take the example of a front desk employee. “The front desk is where the revenue cycle management process starts, with patient intake. If you have a bad front desk, it follows throughout the whole revenue cycle management process,” Lion explains.
It’s a scenario Lion has witnessed firsthand. If the necessary intake information isn’t being passed along properly to the doctor and billing representative, your practice will see the impact in the form of increased denials. “To put a monetary value on it, it could be easily thousands of dollars” you’re costing your practice, says Lion. Losing this type of money simply isn’t an option for practices that want to remain financially viable.
Undermining a Manager’s Authority
The final staffing example Lion mentions isn’t related to hiring or firing—it’s about organizational structure. You’ve probably heard of an “open door” policy; it’s one in which managers leave their doors open, literally or figuratively, to lower-level employees who wish to voice concerns or raise questions.
A key tenet of employee satisfaction is that it’s important for employees to feel their opinions are valued. As such, practice managers may turn to an open door policy to help staff feel more comfortable in approaching them directly with problems. The problem with this policy, however, is that when lower-level staff are encouraged to “go to the top” with their concerns, they’re often bypassing middle management to do so.
Of course, there are situations where this may be appropriate. But encouraging lower-level employees to approach you directly with any and every concern undermines the authority of their direct managers. This can damage the morale of these managers, Lion says, because you’re “not empowering them to supervise.”
What’s more, you’re creating organizational inefficiencies (and more work for yourself) by taking on tasks that should belong to another manager.
Incentive Programs Gone Wrong
Incentives, rewards and perks are another common approach for boosting employee morale and improving job performance. But proceed with caution.
Creating Incentives for Existing Job Responsibilities
Incentives should never encompass tasks that are already part of an employee’s job description, Lion says. You’re already paying employees to perform these responsibilities, so offering incentives for doing so sets the precedent that “holdouts” or poor performers can ultimately be paid more for doing the work they should have been doing all along.
Rewarding employees for routine tasks also makes it more likely that they’ll ignore other tasks required for their position. “The next comment you’ll get [when asking staff to do basic job tasks] is, ‘How much of a raise do I get for that?’” Lion says.
Instead, you should clearly communicate your expectations around employees’ basic job responsibilities, and staff shouldn’t receive rewards for completing them. Incentives should focus on broader improvements that deviate from employee’s standard responsibilities and that typically aren’t under any one employee’s control. “If you want to improve collections, or wait times…that’s where an incentive program comes in,” Lion explains.
Miscalculating the Value of Incentives
While incentives shouldn’t exist for routine tasks, this doesn’t mean they’re a bad idea all around. In fact, they can be a great way to foster positivity and motivation.
But incentives also represent costs for your practice—costs that are often recurring. Before committing to these added expenses, it’s essential to understand the value of what you’re offering versus what it costs to offer it.
Kimberly Abel, VP of employee solutions at Maritz Motivation Solutions, says practices sometimes offer rewards that employees simply don’t value very highly. One example she gives is offering employees theater tickets (e.g. to a new critically-acclaimed play in town). While this may seem like a nice gesture on the surface, in practice, it means the employer is dictating how the employee should spend time outside of work, on a specific date.
Additionally, Abel points out, such an outing may require the employee to shoulder certain expenses, such as paying for a babysitter if they have children. In this example, the more formal attire expected at such an event may also create a burden for some employees.
Abel’s advice? “Know your people,” she says. “Understand the demographics, drives, culture and motivators of your staff and ensure these perspectives are taken into account.” In the example of the play, she says, “coupons for a restaurant that is steps away from the office could be more of a treat.”
Creating Divisive Incentive Programs
Another concern our experts raised is that rewards shouldn’t create divisions between employees, or groups of employees. This seems like a no-brainer—after all, no one implements an incentive program with the goal of causing departmental rifts. But these divisions can often be a side effect of a well-intentioned effort to improve morale.
Jennifer O’Brien, a consultant with Karen Zupko & Associates, Inc., has 27 years of practice management experience. She recalls a large practice whose billing department manager launched a holiday decorating contest among employees without first discussing the idea with other department managers.
As it turned out, the workspaces of employees in the other departments overlapped with patient areas where only “approved” holiday decorations were allowed, which meant they couldn’t participate in the contest.
Ultimately the billing manager had to ask her employees to take down their decorations, but the damage had already been done: employees in other departments felt left out, while the billing employees were frustrated that their efforts had been in vain.
What’s more, says O’Brien, “the frustration among the other managers for having to deal with questions [about the situation] all day was high.” To top it all off, the failed contest only exacerbated an issue that had already been somewhat contentious in the practice: lack of space.
Marc Barbier, a practice consultant with Premium Product Consultants, provides another example of how practices can unintentionally create rifts. In his experience, practices looking to improve morale are often eager to recognize individual employee contributions. However, he says, promoting individual performance over team performance can cause problems.
“It’s important to acknowledge contributions,” Barbier says, “but the team dynamic is so important in a doctor’s office, which means you want to reward staff for working well as a team.” Consistently rewarding only individual performances sends the wrong signal, and can foster an environment of unhealthy competition and individualism, rather than a productive team dynamic.
Business Initiatives Gone Wrong
Another recurring theme that surfaced among our experts is that practice owners often approach the goal of “improving morale” as they would any other business initiative. Instead, morale requires its own unique focus.
Approaching Morale as a One-Time “Project”
Many practice owners view boosting morale as a discrete task—something they can do once and then be done with. They may try to benchmark or set goals for morale, thinking, “We’ll work on morale for X months, and then it will be fixed.”
Dr. Drew Stevens, Ph.D., is the author of Practice Acceleration by Greenbranch Publications and president and owner of Stevens Consulting Group. He recounts the story of a large hospital with pervasive morale problems. In an effort to resolve these issues, the hospital decided to hold a leadership conference for employees.
They borrowed from the models of successful public companies, and brought in keynote speakers and held breakout sessions. They discussed communication techniques and leadership skills, and even engaged in team activities and a Q&A with the hospital CEO.
But once the meeting was over, there was no follow-up. “There were no action steps, and there were no bridges from the conference activities to daily activity,” Stevens explains. “As staff determined that no changes were implemented, attrition skyrocketed and morale continued to decrease.”
Instead, the hospital should have continued to communicate important messages with staff after the conclusion of the conference. Feedback from the conference should have been used implement changes, and hospital managers should have continually followed up to check in and make adjustments.
Using Team-Building as a Quick Fix
Similar to the project-based morale approach, some practices mistakenly attempt to borrow other strategies from broader corporate culture to improve staff morale.
Stevens describes a hospital that attempted a large-scale team-building outing: they planned a white water rafting trip in attempt to build stronger communication channels among staff. Management determined that morale problems centered around staff “not getting along,” so they decided to assign seating on the rafts to force employees who otherwise would not have interacted to spend time together.
While employees worked together to some degree of effectiveness while on the rafts, this solved nothing in the long term. Once back in the office, says Stevens, “morale fell into an abyss.” The staff felt “set up” by the management trying to force friendly interaction. As a result, Stevens says, “the customer service ratings and many other internal productivity issues began to greatly suffer.”
While this is an extreme example, it illustrates a broader point our experts repeatedly made: “quick fix” attempts, such as isolated team-building sessions, are never sufficient.
Prioritizing Rewards Based on Job Impact
Another issue with morale-boosting strategies is a tendency among practice owners to distribute rewards disproportionately to employees whose jobs have the greatest impact on the practice.
Barbier and O’Brien both say that many owners and managers look at the scale of an employee’s role to determine who’s most impactful, and give those employees greater opportunities for rewards and incentives.
“Sometimes physicians give bonuses and perks to only the employees most immediately visible to them,” O’Brien says. “This is another costly mistake that may have been intended as a morale booster, but results in a plummet overall.”
From a business perspective, adopting this approach makes sense: you’re looking at the scale of employee performance and how it contributes to your practice’s the bottom line. The problem, Barbier points out, is that this isn’t consistent with how employees define their worth.
“They’re thinking in terms of commitment to their job and the practice,” he says. In this regard, it’s a level playing field: any employee can be equally as committed as any other, regardless of how much they’re earning the practice.
Of course, it is appropriate to “reward” performance that directly contributes to your practice’s financial well being—which is why you’re probably paying employees with a greater impact on your revenue more than other employees. But morale-boosting efforts aren’t the time to prioritize based on impact. If you’re offering rewards or perks, each employee should have an equal opportunity to participate, regardless of their role.
Morale Boosting Done Right
As our experts noted, and as the examples in this article clearly illustrate, there is no quick, one-size-fits-all fix for improving employee sentiment. Maintaining high morale in your practice requires a great deal of thought and a genuine concern for your employees.
However, there is comfort to be found in O’Brien’s assurance that you don’t need a lot of capital to implement tactics that successfully lift employee satisfaction. “The most effective morale builders actually cost the practice and the employees very little, if any, money,” she says.