At first reluctant to accept his post, Scripps Health's Vic Buzachero eventually entered the fray and helped re-create his new employer.
This article accompanies Piloting His Own Path: Jeff Shuman, the 2011 HR Executive of the Year, and The 2011 HR Honor Roll .
The year was 2001 and Vic Buzachero found himself in decision mode. Should he really relocate from Seattle to San Diego to join a nonprofit health system facing significant operating losses, limited cash on hand, an ousted CEO and doctors who were fleeing? Scripps Health, his potential employer at the time, also faced labor shortages and an HR department that wasn't connected to business needs.
"The first time a search consultant called me, I gave him other names," says Buzachero. "I was really not that interested."
It took six months of prodding, but he finally agreed to make the move after the company's top leaders convinced him of their belief that Scripps employees are crucial to the company's brand -- they just needed someone to create an HR function that carried out that philosophy.
"Given that foundation, I felt Scripps was the right place to be able to accomplish a turnaround," he says.
The transformation effort Buzachero led over the past 10 years earned him a place on HRE's 2011 HR Honor Roll.
Buzachero attacked the company's problems in small chunks. First, he made sure that each fiscal year started with a workforce strategic plan -- meant to define the HR plan going forward. He figured out what needed to be done the old-fashioned way -- by circling around the organization and asking leaders to assess the company's strengths and weaknesses.
But changing the culture of an organization didn't come easy.
"There was some backlash," he says. "I had to spend a lot of time building relationships with operating executives because they were not accustomed to HR executives stepping up and leading with workforce initiatives."
Then he developed a strategy to lower the company's dependence on outsourced nurses. In 2001, 20 percent of Scripps' registered nurses were temporary and, because of the severe nursing shortage at the time, were being paid at a premium.
Worse than the money factor was the lack of a stable staff.
"You need a little more continuity," he says. "[Contractors] do not have the same level of commitment to the employer and co-workers ... [full-timers] are less likely to make errors and [they] provide great patient care."
Now, Scripps' temporary nursing staff is below 8 percent of the 13,200-person workforce, resulting in more than $100 million in reduced labor costs annually.
Buzachero and his staff also developed a new compensation strategy for nurses who had been underpaid compared to market norms -- making it tough to attract and retain top talent. Now, the company examines pay every six months and pays merit increases and bonuses for increased patient satisfaction.
Those efforts helped the company reduce the turnover rate for RNs to 8.6 percent in 2010, compared to 25 percent in 2002.
He also created the Scripps Employee One Hundred, a series of meetings in which rank-and-file employees can meet with the CEO and other top officials. To gain access, employees submit nomination forms and are generally high performers interested in getting candid answers about the direction of the company.
"It moves us all to a higher level of accountability," says Buzachero.
He also instituted in 2002 the first company-wide employee-engagement survey, in which 58 percent of employees at the time said Scripps was a great place to work. In 2010, that number climbed to 88 percent.
Buzachero got his taste for HR while serving as a manager for two different fast-food restaurants while attending college at the University of Alabama. He learned how making good hires and developing an engaged team leads to terrific results. He also saw the flip-side.
"I saw the criticality of how human capital can make a difference in the workplace," he says. "I enjoyed pulling together and building a team through selection [and] development, and watched how some teams outperformed others -- and that captivated [me]."
He saw each restaurant as profit-and-loss centers, and the experiences taught him the fundamentals of business.
"If they don't like the food and service, they're not coming back. Period," he says. "The basic principles of marketing, customer service, managing costs, growing revenues, managing a P&L, building a team -- I think that's transferable at any level."
Buzachero's first HR job was as an employment manager at a health system in Birmingham, Ala. (the company is now known as Tenet Health and based in Dallas.) In that role, he built recruiting campaigns on radio, TV and college campaigns, he says, which allowed him to "learn a lot about the business in a hurry."
From there, he served as the director of HR for a new hospital -- a big leap for an HR professional with as little experience as he had at the time.
"Others were offered the job before I was," he says, "but I jumped at it because it was a chance to do everything from the ground up. What better way to learn than to be thrown in and have to build everything from ground zero. If you inherit what others have built, the depth of your knowledge is somewhat limited.
"I think a lot of my early career success was my willingness to start at the bottom, roll up my sleeves, do it all and take a little bit of risk each time," he says.
One of his trademarks is a black notebook that he seems to carry everywhere -- so he's ready when an idea hits him.
"I'm constantly looking for ideas, opportunities and ways we can make a difference and create value," says Buzachero. "I think my staff and others get a kick out of it. About the time we're running out of things to do, my black journal comes out and I have a whole list of things to do that they haven't even thought about yet."
Scripps CEO Chris Van Gorder says Buzachero was instrumental in helping to take the HR function to a new level.
"When I first came to Scripps, we had very few internal educational opportunities for staff and management," he says. "Today, we have an array ... including the Employee 100, which was modeled after the Scripps Leadership Academy that I established 11 years ago. Today, Scripps employees can receive much of the education internally and, as a result, Scripps has become a career destination for many of our employees."