Becker's Hospital Review

31 31 CEO/STRATEGY CEO Turnover for Misbehavior Up 36% Worldwide By Emily Rappleye M ore CEOs are being ousted than ever before for ethical missteps at the world's 2,500 largest public companies, according to a study conducted by PwC's Strategy&. Turnover for unethical behavior increased 36 percent between 2007-11 and 2012-16. From 2007-11, 3.9 percent of CEOs at the world's top companies were forced to step down due to misbehavior, compared to 5.3 percent in 2012-16, according to the report. e increase was even larger — 68 percent — among North American and European countries, where CEO turnover for ethical reasons increased from 4.6 percent in 2007-11 to 7.8 percent in 2012-16. However, Strategy& notes in an analysis of the study that this jump in CEO turnover is not necessarily because more CEOs are com- mitting fraud, bribery, insider trading and other ethical transgressions. Forced turnovers for ethical concerns and other reasons have decreased over the time period studied, from 31.1 percent in 2007-11 to 20.3 percent in 2012-16. Instead, the increase in turnover for ethical reasons is likely due to a blend of factors, including increased suspicion of companies by the public, more proactive and punitive governments, increased ethical risk as company footprints grow, exposure to new types of risks from digital communication and amplified publication of negative infor- mation by the 24/7 news media, according to the analysis. However, there are a few things organizations can do to avoid CEO misbehavior. e first is division of power. e study found CEOs with joint titles as chairperson were more likely to be ousted for an ethical transgression than those with just one title as CEO. But this trend seems to be declining. Among the top 2,500 public companies in the world, 48 percent of leaders held joint titles in 2002, compared to just 10 percent in 2016. e second strategy to reduce ethical infrac- tions at the top is to limit tenure. e study found CEOs ousted for misbehavior were at the helm for a median of 6.5 years, compared to those ousted for other reasons, who held the job for a median of 4.8 years. Lastly, Strategy& recommends companies build a culture of integrity to avoid executive misbehavior by addressing external pressures, business processes and internal influences. "To reinforce those behaviors, the company's organizational ecosystem must address the underlying conditions that are always present when employees engage in illegal or unethical acts, by (1) ensuring that the company isn't creating pressures that influence employees to act unethically; (2) making sure business pro- cesses and financial controls minimize oppor- tunities for bad behavior; and (3) preventing employees from finding ways to rationalize breaking the rules," the authors wrote. n The 3 Most Effective Words in Healthcare Ads By Brooke Murphy M arketing plays an important role in influencing con- sumer healthcare decisions. Predictably, some healthcare messaging, media forms and strategies resonate more with consumers than others — but the ones that resonate most may surprise you. The "2017 Southwest Healthcare Marketing Report: Con- sumer Perceptions & Attitudes" surveyed roughly 500 con- sumers in the Southwest about their sentiments regarding healthcare advertising and marketing. Respondents lived in Arizona, California, Colorado, Nevada, New Mexico and Utah. The survey was commissioned by Lavidge, a Phoenix-based advertising, public relations and interactive marketing agen- cy, in conjunction with WestGroup Research, a large market research firm in the Southwest. Here are four key takeaways about consumer perceptions of healthcare marketing. 1. Get picky over word choice. Respondents were asked to rank a series of words by their effectiveness in healthcare messaging. The top three words were "knowledgeable," "trustworthy" and "cost-effective." While that may not seem like groundbreaking news, consider this: Similar words like "expert," "helpful" and "innovative" ranked significantly low- er. "[Patients] see a clear difference between 'knowledge- able' and 'smart,'" researchers wrote. "Clearly, nuance [in messaging] matters." 2. Holistic messaging was preferred to expertise. Re- spondents also ranked phrases by preference. The outright winner was "We will treat the problem, not just the symp- toms." Consumers preferred this more holistic messaging to phrases such as "We have the best treatment" and "We understand what you are going through." Interesting, although predictable, was consumers' sec- ond-ranked phrase: "We will handle all insurance matters for you." The phrase clearly points to an opportunity for health systems to differentiate themselves from competitors in the market by promoting themselves as "experts" in handling in- surance matters. "An entity promising to handle all insurance matters for you will be welcomed in the market if the compa- ny delivers on that promise," researchers wrote. 3. Patient testimonials were least effective at attracting interest. The least preferred statement was "Your friends recommend us." This runs counter to many health organiza- tions' current messaging, which emphasizes patient testimo- nials and consumer experience. 4. Preferences differ between light and heavy healthcare users. Consumers who do not regularly use healthcare ser- vices ranked the message "We will be there for you," much higher than other marketing phrases. "The healthier the con- sumer, the less receptive they'll be to messages that empha- size current needs, such as "We are an expert in your particu- lar health condition or disease," researchers wrote. n

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