I sat at the end of the table next to the CEO at my first hospital board meeting as an outside general counsel. The medical staff president walked into the nearly-full board room, and upon eyeing me, immediately asked the assembled group, “Do you know the difference between a dead dog and dead lawyer at the side of a road?” After a pregnant pause, he answered, “there are skid marks in front of the dog”.
I took the barrage of lawyer jokes in stride. But, lawyers are no laughing matter.
Many years later, a colleague who, like me, had transitioned from lawyering to the business side of health care, told me about a lunch he had with Jack Welch, the former CEO of General Electric, on the eve of being named president of a national health insurer. “You only have to remember one thing about leadership,” Jack advised him. “Have a great lawyer and a great CFO you can trust.”
I remember a call from the CEO of a major health care organization asking me to handle a novel transaction with a large physician group. His words were telling, “Getting this deal done is ‘mission critical’. I understand there are compliance issues. You can take us up to the edge, but don’t let us go over the line.”
It’s simple, really. A leader cannot risk the mission, reputation and financial well-being of the organization - no matter what. Having a trusted lawyer who knows the business, knows how to lawyer and has the courage to exercise independent judgment is essential.
Much the same is true for the CFO. Having strong financial reporting and accounting controls and solid analytics to support decision-making are essential. The CEO needs a CFO who, armed with those tools, has the gumption to tell the bad news, the grace to qualify good news with evidence-based warnings about future contingencies and the relationship skills to collaboratively problem-solve with management.
April 2016