Skip to main content

The Importance of Healthcare Leadership

October 5, 2021

Underestimating the importance of healthcare leadership is hard to do, especially during a crisis. During Hurricane Katrina, power went out, floors flooded, and supplies ran low at Memorial Hospital. Evacuation was impossible. Healthcare leaders had to decide what to do to help patients.

During the onset of the COVID-19 pandemic, a shortage of personal protective equipment pulled healthcare leaders in two directions: advocating for their staff while also collaborating with global institutions to share scarce medical resources.

Healthcare leadership matters even during more normal times. In 2020, when over 106,000 people remained on organ donation lists and 17 died per day waiting for organs, healthcare leaders made hard decisions about who to prioritize for life-saving surgery. Today, healthcare systems are more interconnected and interdependent than ever before. The result? Healthcare leaders need to make decisions faster, synthesize a deluge of healthcare data, collaborate regularly with diverse stakeholders, and lead their teams through healthcare dilemmas.

Healthcare is both a business and an essential service industry. That means that healthcare leaders need a wide range of skills, from business acumen and data management skills to compassionate care.

Learn more about healthcare leadership and different leadership styles in health care that foster collaboration and set conditions for long-term success.

How Leadership Affects Healthcare Teams

Leadership can make or break a healthcare organization.

For example, during the pandemic, numerous nurses spoke out about the mental toll of working on the front lines. EMTs, doctors, and administrators witnessed not only patients suffering from illness but also families torn apart by COVID-19 denial and vaccine refusal. Healthcare workers voiced concerns about shortages of personal protective equipment.

Strong leadership was associated with better healthcare service delivery during the early stages of the pandemic, according to professor of leadership studies Dr. Cecile Gerwel Proches. With morale among healthcare workers at a low, healthcare leaders needed to attune to their staff’s evolving needs.

Today, most healthcare organizations comprise multiple departments. A strong healthcare leader communicates across teams quickly and easily, and they know how to navigate conflicting demands.

Understanding Healthcare Systems: Managing Teams and Different Subcultures

Healthcare systems are large organizations composed of numerous specialized departments, offices, and professional groups that need to coordinate with each other. Individuals working in the same healthcare organization may work solo or in teams to carry out complex tasks in:

  • Medicine
  • Finance
  • Supply chain management
  • Radiology
  • Pharmacy
  • Human resource management
  • Administrative duties

In a hospital, for example, a single floor may house offices for surgical staff, nurses, and medical billing experts, with a distinct subculture in each department.

In such a complex environment, healthcare leaders may need to deploy multiple leadership styles to encourage personnel from different departments or to handle different tasks. Reducing healthcare spending and tightening the budget requires more engagement with data analytics and financial models. Conducting service outreach may require healthcare market research, provider training, and hiring for new roles.

Leadership Styles in Health Care

Leadership styles in health care vary, and leaders can adapt each one, depending on the context.

Historical Approaches to Leadership

Leadership theories, while not traditionally developed for healthcare settings, have changed over time.

Before the 1940s, the popular “great man” theory of leadership assumed that some individuals simply were born with charismatic qualities that made them superior leaders. Business leaders considered themselves naturally endowed with resilience, courage (to take smart financial risks), and other virtues that put them ahead of their competitors and inspired their workers to achieve more.

Later, organizational psychologists conceived of leadership as less of a reflection of moral or intellectual character and more of a set of behaviors that could change organizational dynamics with effort and time. Researchers noted three distinct styles of leadership:

  • Authoritarian (hierarchical, demanding)
  • Democratic (communal)
  • Laissez-faire (hands-off)

As these styles became more common for categorizing leadership, theorists also began to prioritize workers’ needs. Now called situational theories of leadership and contingency theories of leadership, these approaches focused on the way that work environments affected workers’ productivity. For example, workers with access to break rooms and clean offices outperformed other workers, leading managers to think about office design’s role in business outcomes.

Today, many theories of leadership point to the idea that workers are happier and more satisfied with their work when leaders empathize with them and support them. Moreover, supportive leadership research also suggests that employees who feel supported and inspired by their organization’s mission are more likely to make progress toward their work goals.

How Healthcare Leadership Has Changed Over Time

Transformational leadership in health care requires an understanding of how healthcare systems have changed forever.

Healthcare leaders in the 19th and 20th centuries operated in information silos. A director of a rural health clinic may have read published articles on emerging healthcare technologies for special topics every few years, but most often, they would see patients, crunch numbers, and balance their budgets independently of outside influence.

In traditional healthcare leadership modes, those at the top of the hierarchy made decisions with little to no input from other healthcare staff. Doctors, high-level administrators, and other executives did not consider the insights of nurses, front-desk administrators, and others who tended to work with patients more often and for a longer period of time.

Today, transformational healthcare leaders recognize the importance of bringing stakeholders from all areas of a healthcare organization into conversation.

Leaders in health care have more to do than ever before. Healthcare leaders have:

  • More data to manage (more patients and larger medical care teams to coordinate)
  • More complicated hospital billing services (insurance, payment plans, and federal and local laws)
  • Less time to deliberate about large-reaching policy decisions that affect their organizations
  • New technologies and tools to learn and train their staff how to use

This is an exciting time of growth and innovation for healthcare leaders.

The COVID-19 pandemic forced health care to reckon with its outdated styles of leadership. Today’s dynamic and fast-paced healthcare systems demand accelerated decision cycles and greater coordination. They require smooth, swift communication among healthcare team members and stakeholders.

Healthcare leaders who take a team-oriented approach to engaged leadership — rather than clinging to hierarchical leadership styles — can meet tomorrow’s challenges.

Leadership Style 1: Transformational Leadership

Transformational leaders communicate the organization’s vision and value, motivating their staff by helping them tap into their own sense of what matters about their jobs.

For example, health administrators who feel inspired by a sense of contributing to the health and well-being of their community may respond well to an organization-wide effort to recognize how greater efficiencies with behind-the-scenes duties can reduce patient wait times.

Transformational leaders thrive in organizations where leaders can name and demonstrate how each department — and each person — contributes to a larger goal or mission. This leadership style may not always be as useful in organizations that already have a clear mission or that need other kinds of leadership support.

Leadership Style 2: Collaborative Leadership

Collaborative leaders work to build synergistic work environments in which people from across teams and departments communicate clearly and use data to make informed decisions.

They may focus on developing communication channels and promoting an understanding of different cultures within an organization.

For example, a collaborative leader might implement an organization-wide communication medium (e.g., an integrated health dashboard) that replaces an individual department’s disparate communication platforms (e.g., email and handwritten notes).

By nurturing interdependency and reducing opportunities for miscommunication, collaborative leaders can bring more healthcare team members to the table to discuss important issues.

Leadership Style 3: Shared Leadership

Shared leadership draws from the idea that leaders must empower staff to make decisions for themselves. It emphasizes a need to develop collaborative relationships among staff through task delegation, continuous workplace learning, and shared ownership of specific roles and tasks.

For example, in a rural mental health clinic, a small team of medical professionals could determine its daily, weekly, and monthly tasks and then split the tasks among the team according to each professional’s skill set and bandwidth.

Shared leadership presumes a healthy working relationship between individuals, so this style may be less suited for newer organizations or organizations with high turnover rates.

Leadership Style 4: Distributed Leadership

The distributive leadership style starts from the observation that we live in an increasingly interconnected, globalized world, which means the healthcare field is constantly in flux.

Distributed leadership responds to the uncertainty of global supply chains (and other forms of change and disruption that can arise in health care systems) by becoming less hierarchical. This style has four key priorities:

  • Sense making — seeking to understand the changing healthcare business environment and adapt
  • Relating — building trusting relationships and supportive advocates
  • Visioning — discussing what an organization will look like moving forward
  • Inventing — creating new solutions to problems

Distributed leadership, like shared leadership, attempts to return agency and decision-making power to the hands of workers at any level. The difference is the emphasis: Shared leadership prioritizes the value of task delegation, whereas distributed leadership focuses on innovation and anticipating new healthcare trends.

Leveraging Diversity in Healthcare Leadership

Healthcare systems need to adapt to the 21st century. That entails employing healthcare administrators who reflect the racial and gender diversity of the U.S. Women in healthcare leadership and people from Black, Latino/a, and Native American backgrounds continue to be underrepresented in hospitals, medical research facilities, clinics, outpatient facilities, pharmacies, and mobile clinics.

By hiring and promoting skilled professionals from underrepresented backgrounds, health care services can become more efficient and equitable.

Lead in Health Care Today

Healthcare leadership starts with a clear vision for a healthy, well-functioning organization. Leaders in health care today understand the complexity of the systems in which they operate. They have compassion for fellow workers and for patients.

The Online Master of Health Administration at Tulane University provides a strong foundation for a successful career in healthcare leadership. Through its cutting-edge curriculum, students can earn an advanced degree that can boost their career prospects while still working full time. Learn more about how healthcare leaders are preparing for tomorrow at Tulane.

Why Healthcare Advocacy Is Important

Why Community Health Is Important for Public Health

What Is Health Equity? Ensuring Access for Everyone


The Conversation, “How Leadership Matters in Healthcare — Especially in a Crisis”

Health Resources and Services Administration, Organ Donation

International Journal of Scientific and Research Publications, “Leadership Styles for Healthcare”

Managed Healthcare Executive, “The Future of Healthcare Leadership”

National Center for Healthcare Leadership, NCHL Health Leadership Competency Model 3.0™

NEJM Catalyst, “Improving Healthcare Leadership in the COVID-19 Era”