BTU #130: 20 Year Pilot to Hospital CEO (Harry Schmidt)

“Really what the civilian sector is needing and looking for are leadership skills. And the leadership skills that [veterans] have learned by getting a tremendous amount of responsibility early careers, or dealing with VUCA (Volatility, Uncertainty, Complexity, and Ambiguity) – that’s the life we lived in the military. The civilian sector is looking for people who can deal with and handle and make great decisions within the volatility, uncertainty, complexity and ambiguity. That’s the skill set that is transferrable, regardless of your warfare specialty.”
– Harry Schmidt

 


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Why to Listen | Sponsors | Selected Resources | Transcript & Time Stamps | Comments

 

I was introduced to Harry by Washington University in St. Louis. WashU’s Executive MBA (EMBA), a 20-month program where students meet on campus for 3 days per month, has helped many veterans like Harry transition to their civilian careers.

Harry Schmidt is the President & CEO of Passavant Area Hospital, an 130 bed acute care hospital serving over 3,700 inpatient and 40,000 outpatient visits annually with an operating budget of $120 million, 960 employees and 90 physicians, located in Jacksonville, IL. He started out at the Naval Academy, and served as a pilot for over 20 years, including time as a Top Gun instructor. After his military service, he went into the health services industry at the Memorial Health Systems – starting as a Medical & Affiliate Systems Analyst and working his way up to a Vice President of Facilities Management, before his current role as CEO at Passavant Area Hospital.

Why to Listen: 

Although Harry served for 20 years as a pilot in the Navy, when he got out he didn’t go into the airlines business. Instead, he took a drastic career change (that came about with a conversation with his neighbor) and entered into the Health Services industry. His story is one of continuously redefining his own identity, and a path that has led him to be CEO of an $120 Million dollar, 960 employee hospital.

  • StoryBox – People trust each other more than advertising. StoryBox provides the tools and supports businesses need to take the best things customers say about them, and use them to drive more sales and referrals. StoryBox offers a 10% discount to companies employing veterans of the US Armed Forces.
  • Audible is offering one FREE audio book to Beyond the Uniform listeners. You can claim this offer here, and see a list of books recommended by my guests at BeyondTheUniform.io/books

Selected Resources: 

  • Jimmy Sopko BTU #6 – I reference this interview as a great example of a veteran who took a step back in their career to make a big transition.
  • Message to Garcia – we talk about this as a GREAT example of approaching your new civilian career with initiative
  • Cal Newport BTU #86 – I reference this as an example of what has helped Harry grow and develop into his role as CEO
  • Elite Meet– making connections with special forces and pilots and connections to business executives to make informed decisions about where they want to go
  • Washington University Olin School of Business – they have a great veterans group, and they’ve got an exceptional business school program
  • Emily Cherniack BTU#70 – New Politics is a great organization that helps veterans run for political office (on either side of the aisle in terms of political affiliation)

Transcript & Time Stamps: 

You served 20 years in the Navy as a pilot prior to making your transition. When you were on active duty, how did you start to prepare for your transition? (6:50)

 

It’s a great question because there’s a ton of uncertainty and ambiguity regardless if you’re leaving after one tour or after a full career. I started the process late, probably about six months before retiring which is not a lot of time. I was very fortunate that I had a neighbor who was able to help me through the process. This ultimately ended up being the tie that got me into healthcare.

 

(7:58)

As a pilot you can imagine that the logical conclusion would be going to fly for the airlines. My wife and I considered it but I didn’t want to be away from home so much after 20 years in the military. So then I started thinking about what skill set I had and what could be transferrable. We’re always talking in acronyms in the military and a lot of times when people transition, they don’t translate accurately or effectively who they are and what skill set they have.

 

(9:25)

When a service member is transitioning, I think it’s important to set boundaries and parameters for what kind of a job or career you want afterwards. Otherwise, you could end up chasing something that’s someone else’s dream. It could be a fit for someone else but not for you. My family and I wanted to come back to the mid-west. That was the fit for us. You have to know what your fit is as you start to pursue your transition.

 

(10:55)

The ability to say “no” is also important in the transition process. There is so much  information out there and there’s so many  opportunities. There’s so many people that are looking to help veterans in their transition but you can really get lost in the myriad of opportunities .

 

(11:50)

What he civilian sector is looking for is leadership skills. The leadership skills we have learned through getting a lot of responsibility early in our careers, dealing with VUCA (volatility, uncertainty, complexity, and ambiguity). That’s the world we’ve lived in during our time in the service. People in the civilian sector are looking for people that can handle these situations and make great decisions within volatility and uncertainty, That’s the skillset that’s transferrable regardless of your warfare specialty.

 

What lead you to Memorial Health Systems? (13:50)

 

My family was living near Springfield, Illinois. The population is around 150,000 people – a relatively small community. Not a lot of big industry, only certain things in the area. We had built great relationships with our neighbors, one of whom was a physician. He said, “Hey, let me float your resume at the hospital and see if there’s anything they would be interested in.” I didn’t think they would want anything to do with a former pilot. But when the human resources department saw my resume, they saw that I had a Computer Science degree and wondered if I would be willing to work in IT. And that started the chain. Fortunately there was another veteran working in IT who was willing to hire me because he knew that I would do whatever he asked me to do. He saw that I had the technical ability and also the initiative and drive to succeed. He was  a former Marine so he recognized those characteristics in me as a fellow veteran.

 

(16:40)

I think one of the key takeaways for anyone listening to your podcast is that at least 80% of all jobs (manager and above jobs) are earned through networking. People aren’t going to hire a piece of paper. They hire a person that they believe they can teach the necessary skills to in order to succeed in a position. The piece of paper doesn’t say anything about work ethic, integrity, or commitment. Leadership is all about influence. If I hire someone that doesn’t have the ability to lead and influence others around them, that isn’t helpful to me. I didn’t fully understand this when I was transitioning in 2007 but I appreciate it more now. I can’t emphasize enough how important networking is – just getting to know other people and letting them get to know you.

 

Veterans are sometimes surprised by the step back they need to take when moving into their first civilian position. After 20 years of service, what was your first transition like in terms of seniority and pay adjustments? (19:30)

 

I was able to handle this in a different fashion because my new job had a title that was so far removed from what I was doing before. One thing I’m very grateful for is that I started out in a lower pressure job where I had the opportunity to learn about the culture and about the industry. I didn’t have a leadership role where I had to stand up in front of people and promote the company culture before I even had the opportunity to learn it.

 

(21:10)

Once I was in my role, no one knew I had run a maintenance squadron with 120 people in it. I had had some really significant leadership roles previously. But I wanted to learn the new culture from the ground up. When various opportunities would come up, I would be one of the first people to volunteer because to me it was an opportunity to learn about the culture and the environment. And next thing you know, just by taking opportunities and learning new things, a managerial position became vacant and I had the opportunity to step into the role. That’s how I’ve been able to move through the health industry. It’s not because I said, “One day I want to be the CEO of a hospital.” I’ve just tried to contribute and learn about whatever role I’ve been in. That’s also why I elected to pursue my MBA. I saw that that’s what I needed to make the next step in my career.

 

I love that you were willing to take on your new role with humility and a willingness to take risk and try new things. You really took a “Message to Garcia” approach. (24:00)

 

If you’re a veteran listening and don’t know what “A Message to Garcia” is, I encourage you to go look it up. I think the message of humility is really tremendous.

 

(25:01)

The competitive advantage a lot of veterans have is that we’ve existed in that VUCA world. We’re willing to step in and figure out a way to accomplish the operation.

 

(26:15)

I’ve been in my new role as CEO for about 10.5 months now and there’s been decisions along the way that I’ve had to make that might not have been the most popular. When I took a step back and reflected on the decision, I thought to myself, “I will not likely get fired making an error of commission. If I choose to do something and it’s not quite right, I can always modify. But I will get fired if I make an error of omission.”

 

(27:20)

As military members, we are biased toward action. A competitive advantage. People working in a VUCA world can often reach paralysis by analysis. Veterans look at the same situation and take action.

 

Could you share a little bit more about your first few roles at the Memorial Health Systems and how you progressed? (28:17)

 

The most important thing that I learned is that so much of the healthcare industry is regulated, from corrosion inspections to operational readiness inspections. You can always go back to the regulatory requirements and use that to build a new program or to run your operations around.

 

(30:05)

Healthcare IT is highly regulated in terms of information management. The military world is also highly regulated so you can see a correlation between the two. The same skillset can be applied to both worlds. That critical skill set that allowed me to succeed during military inspections also allowed my to be successful in facilities management. Facilities management is all about building safety codes and how buildings are compliant with regulations. You’re preserving the lives of staff and patients. I remember when we were preparing for inspections, my boss didn’t understand how I knew these things since I had been a pilot. But then I started to explain to him more about preventative maintenance and corrective maintenance inside the military. In healthcare, it’s those same procedures that are used.

 

(32:35)

I think the problem a lot of veterans run into is that they think because they were a Department Head, Section Chief, etc., that they should immediately be a director when transitioning out of the military. But there’s a lot of learning that you need to do so that you know exactly what the roles and responsibilities are of a position you want to move into. If you’re willing to take a step back to start out, you can ultimately move ahead much quicker.

 

At what point did you decide to pursue an Executive MBA at Washington University? (34:45)

 

It’s been one of the pivotal points in my short civilian career, and I don’t think I would have this role as CEO of a hospital without that education. As veterans, we learn a lot just through on-the-job experience. We learn about finance and budgeting through the money our team or department is allocated each year. But in a lot of ways, we miss out on the revenue side of the operating statement. Taxpayers are giving us our revenue when we’re in the military so it’s a little different.

 

(36:00)

When I was in facilities management role, I knew that I wasn’t going to be doing that for the rest of my career. I talked to my boss about different opportunities for continued growth. He suggested going to business school and learning about different dimensions of business that I hadn’t been exposed to. Regardless of your specialty in the military, the MBA can be a good way to round out your skillset and learn about terminology.

 

(37:20)

I initially looked at a school and started a traditional MBA program, taking classes at night. But it was a little bit disjointed. I didn’t feel like I was being challenged in a way that I wanted to be. So I started looking at different opportunities and found the Washington University EMBA program. In the Executive MBA format, we met once a month for 2-3 days and then worked on projects together in between those meetings. The format set me towards what I wanted to do. I moved through the 20-month program with the same group of people in a cohort fashion. We were able to challenge each other because we had similar levels of experience.

 

(40:05)

I would also add that sometimes people think it’s just about the letters behind your name. But that mentality will only get you so far. More than the degree itself, I want to know where the person got that degree from. I want to know that they had meaningful conversations about business with others in the program, that they had negotiations and debate. Work gets done in business through relationships so I want to know that a person developed these skills during their degree program.

 

When did you make the transition to your current role? (42:10)

I graduated from my MBA program in 2015. I was still in the role of Vice President of Facilities Management at the time. I was transparent with my boss about it – that I wasn’t dissatisfied with my role but that I didn’t see myself doing it for the rest of my life. As the organization was growing and developing, a role opened up at Passavant, which is one of seven affiliates within the Memorial Health Systems umbrella. I was one of the qualified candidates. My goal was never to be the CEO of a hospital but I always seeked increased responsibility and leadership opportunities.

 

(43:25)

In my role as CEO, I probably spend about 60% of my time on people issues. Whether you’re trying to establish relationships, understand stakeholder positions, get buy-in from teams of people…I enjoy this kind of work. In my role in Facilities Management, I think the most important part of that experience was building relationships with contractors and team members. In my role now, I’m able to continue to build and develop this relationship building skill set.

 

(45:55)

As a transitioning veteran, you can start to figure out what skill sets are important in a particular position and during an interview, you can give examples of times when you have used those skill sets to create success. So that just goes back to using your story and your skillset in a way that will easily translate  to the civilian world. When I got my first job in IT after leaving the  military, people said, “What do you know about IT, you’re a pilot?” And then when I transitioned to the Facilities Management position, people said, “What do you know about Facilities Management, you’re an IT guy?” And now people say, “What do you know about being a CEO, you’re a facilities guy.” It’s interesting that people will put a label on you but you need to make sure that you can shed that label and that it doesn’t define you. You are more than any one label and can transfer your skillsets to any position.

 

What advice would you give to a transitioning military member that feels intimidated by the thought of “starting over” in the civilian sector? (48:33)

 

When I transitioned, I was 41 or 42 years old. Fortunately after retiring, there is some sort of financial assistance which helps in allowing you to put yourself in a learning position while your income is augmented by your retirement check. If you get out at 10 or so years, it’s more difficult because you don’t have that benefit. Still it’s worth it to have the willingness to take a step back in terms of pay and responsibility and take the time to really learn whatever industry it is that you’ve decided to go into. That ultimately is going to allow you to succeed.

 

(50:00)

Be a life-long learner. Don’t be afraid to learn something new or take advantage of a new opportunity. Most people would be happy to sit down with you if you wanted to learn more about their industry or what they are doing. Use LinkedIn, make a meaningful connection. I would also recommend various veterans networks. I’m working right now with a group called Elite Meet. It’s a group that looks to connect former special forces and fighter pilots with private sector opportunities. There was also a really strong veterans network at Washington University. I’m sure this is the same at many other schools as well. There’s so many people out there that are willing to help and want you to be successful.

 

Is there anything else you’d like to share with our listeners? (52:50)

 

I was asked to give some comments at a Veterans Day event last weekend which was very humbling. As I reflected on that, one of the things I boiled it all down to was that America in general is about leadership. Ever since I made the transition out of the military, I’ve seen a desperate need for strong leadership in the civilian sector. Do the best job you can in the role you’re in right  now and always look for the next opportunity where you can continue to contribute and lead.