So it’s deja vu for KGH. Back in 2003-04, I led the first financial turnaround project to recover it from the prior years’ fiduciary failures by the board and administration. My operations reorganization plan effected, among numerous other accomplishments, a significant reduction in labor expenses (i.e. a painful layoff) to correct for past staffing excesses.
A major failure of the Glen Marshall team, after KGH was returned to profitability, was that they did not maintain our sound metrics of productive labor costs.
Worse, and contributing hugely to today’s unsustainable organization, the Marshall Plan rushed forward with the construction of a new hospital and medical office complex that were predictably unaffordable without community tax support. A truthful financial forecast of this venture would have proved its folly. None was done.
The resulting catastrophic losses, huge unpayable long-and-short-term debts, and zero cash reserves now necessitate another turnaround plan, this time by Quorum professionals. It’s a long shot, though, beginning with the recently announced 10 percent labor reduction (another painful layoff). Shame on Marshall’s team for creating this needless trauma.
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The last time the board hired a CEO, they failed. This time they must succeed, or Kadlec will rule the region.
Jonathan Brenn, former KGH chief executive, Corcoran, Calif.