Behind The Pennant Group Leadership Strategy That’s Worth Millions

The Pennant Group Inc. (Nasdaq: PNTG) has set out on an ambitious endeavor, aiming to build a pipeline of “100 CEOs.”

The company has always leaned into a strategy of purchasing community-driven home-based care agencies with strong ties to their specific markets, and then empowering local leaders.

The idea of health care as a local business, however, isn’t just a strategy. It’s fundamental to how the company operates, and what makes it successful.


“Health care is so dynamic and the needs of every community are different,” Pennant CEO Brent Guerisoli told Home Health care News. “Leaders and teams that are in those communities understand the nuances, and they can adapt. They are meeting with their community partners, and then coming up with local solutions that are tailored specific to the needs of their community. You just can’t do that from a top down approach.”

Guerisoli considers its 100 CEOs initiative a part of this broader strategy.

“We are a leadership company, and the primary purpose is to create life-changing opportunities for our local leaders,” he said. “As a natural extension of that, we want to be able to elevate our leaders in a way where they really become owners in the company.”


Eagle, Idaho-based Pennant is a holding company of independent operating subsidiaries located across the U.S. with a network that includes 99 home health and hospice agencies and 51 senior living

At Pennant, it was important for these leaders to be CEOs, and not anything else.

“There’s a clear difference between the leaders and the teams that are led by CEOs, versus those that just have what we would call the executive director designation,” Guerisoli said. “We see significant improvement on the clinical front. We see significant improvement on the financial front. We see significant improvement in things like turnover, employee satisfaction, patient satisfaction.”

Guerisoli noted that a CEO generates roughly $1 million more in value than a typical executive director.

The company’s CEOs become owners, they receive equity, soft grants and have the ability to influence the organization in a broader way, according to Guerisoli.

Having strong leadership is especially important at a time when home-based care providers continue to struggle with recruiting and retaining workers.

“In order to retain talented people, we have to create an exceptional environment,” Guerisoli said. “CEOs are leaders that can do that. They create an environment where people want to be, where they can flourish and succeed. One of our core values is customer second, which means we take care of our employees. Leaders that take care of their employees in a meaningful way are going to exponentially outperform leaders that don’t.”

Building the pipeline

In order to begin building its pipeline of 100 CEOs, Pennant ramped up its efforts around recruiting and outreach.

“For the longest time, most of our recruiting efforts were through word of mouth,” Guerisoli said. “We found that this limited us to the group of leaders we knew, or the connections that we had.”

This meant investing in a full-time recruiting team that reaches out to potential leaders through multiple platforms.

This also meant not restricting the company’s search to individuals that only have health care backgrounds.

“I came from a different industry, when I joined, I was in telecommunications,” Guerisoli said. “We wanted to be able to have a much broader outreach, both in terms of industry and experience, but also geographically, so that we could expand and grow.”

Prior to joining Pennant, Guerisoli held various roles at AT&T (NYSE: T).

The next step towards building the pipeline was putting in a robust program that would allow Pennant to help all of these individuals become great health care leaders.

“We’ve spent a significant amount of time revamping and building out our leadership development programs, to take somebody from day one, and help them become a better leader and prepare them to step into an opportunity where they’re running a multimillion-dollar business,” Guerisoli said. “But doing it in an effective way that allows them to go from what we call a CEO in training, to an executive director and then eventually a CEO.”

Pennant has made leadership development a major part of the company’s strategy overall. Other home health companies have similarly acknowledged that, without good local leaders, it’s hard to succeed in home health care.

“We’ve made it our primary focus, so everybody in the organization is focused on helping to develop leaders and create these opportunities,” Guerisoli said. “All of our leaders go through the transformation of becoming a better leader. That’s not just for our CEOs in training; we’ve rolled out a robust training program for our clinical leaders. We’re developing programs for therapy leaders, business development leaders, operational leaders. It starts with the CEOs in training program, but it’s about really creating opportunities for anybody in the organization that wants to become a better leader.”

Pennant wants to mold CEOs, but it doesn’t necessarily want all of them to be carbon copies of each other.

The program is meant to allow each leader to come into their own leadership style.

“I’m not – and our executive leadership team isn’t – dictating to the local leaders about how they’re supposed to do things,” Guerisoli said. “We could share in best practices, but that doesn’t mean they’re automatically going to do all of those things. In many ways, you’ve got to give your leaders time to learn, and to fail and to recognize what works and what doesn’t. That takes a significant amount of trust. We extend tremendous trust to our local leaders, and their teams.”

Currently, Pennant is a third of the way toward reaching its goal of 100 CEOs.

That said, the company hasn’t stopped working to improve the process for building its pipeline.

“We’re still honing this process, at the cluster level, at the market level, at the organizational level, there’s still significant improvement that we can make in the programs,” Guerisoli said. “That’s going to be an ongoing process, we can always get better.”

Ultimately, Guerisoli believes that this process will yield long-term growth.

“If we can produce CEOs at a rapid rate, that is our growth, that’s our opportunity to build our company exponentially,” he said. “The better we are at taking a leader from CEOs in training to CEO, the faster we’re going to grow as an organization.”

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