Many challenges ahead for Rusckowski because of healthcare’s unfolding transformation
Yesterday, after the stock markets closed, Quest Diagnostics Incorporated (NYSE: DGX) issued a press release naming Stephen H. Rusckowski as its new President and CEO. He will assume his duties on May 1, 2012. Quest Diagnostics is the nation’s largest clinical laboratory company.
Along with the appointment of its new President and CEO, Quest Diagnostics also announced that Daniel C. Stanzione, Ph.D., would become the Non-Executive Chairman of the Board for the Madison, New Jersey-based company. Stanzione has served as a Director on the Quest Board since 2004.
To ensure an orderly transition, Surya N. Mohapatra, Ph.D., the current Chairman, President, and CEO, will continue his duties through April 30, 2012. It was on October 25, 2011, when Quest Diagnostics disclosed a succession plan and stated that Mohapatra, now 61 years old, would serve for an additional six months as the company conducted its search for another CEO.
Quest Diagnostics Goes Outside Medical Laboratory Industry for New CEO
At 54 years old, Rusckowski comes to Quest Diagnostics with an interesting range of experience. He is leaving a position as CEO of Phillips Healthcare, a division of Royal Phillips Electronics (NYSE: PHG). He was appointed to the position in 2006 and also was a member of the Executive Committee and the Board of Management of Royal Philips Electronics.
Rusckowski has a track record in building businesses. In its press release, Quest Diagnostics wrote that “During Mr. Rusckowski’s tenure as CEO of Philips Healthcare, revenues increased from approximately 6 billion Euro in 2005 to approximately 9 billion Euro in 2011, accounting for approximately 39% of Philips consolidated revenues, from 21% when he became CEO. Philips Healthcare has 38,000 employees in more than 100 countries worldwide.”
Prior to his employment at Phillips, Rusckowski held executive positions at such companies as Hewlett-Packard, Agilent Technologies Inc., and MedQuist Inc. He currently serves as a Trustee at Caritas Holy Family Hospital, a 255-bed hospital in Methuen, Massachusetts. He holds a Bachelor of Science degree in Mechanical Engineering from Worcester Polytechnic Institute and a Master of Science degree in Management from the Massachusetts Institute of Technology’s Sloan School of Management.
As the newly-appointed President and CEO of Quest Diagnostics Incorporated, Stephen H. Rusckowski will assume his duties on May 1, 2012. He will lead the nation’s largest clinical pathology laboratory company at a time when the U.S. healthcare system is preparing for major reforms. (Photo copyright Quest Diagnostics Incorporated.)
Quest Diagnostics’ new President and CEO will immediately face a variety of challenges. For starters, in recent years, Wall Street investors expressed disappointment in the company’s financial performance. Quest Diagnostics has posted only modest rates of growth in specimen volume and net revenue during this time. Analysts and investors will look for early signs that Rusckowski is the leader who can put $7.5 billion Quest Diagnostics back on a sustained growth track.
Challenges in the Clinical Laboratory Testing Marketplace
However, for the pathologists and clinical laboratory managers whose laboratories compete daily against Quest Diagnostics, the more interesting questions center around what new strategies Rusckowski intends to introduce into the laboratory testing marketplace. Phillips Healthcare has a significant market share in such areas as radiology and imaging, health informatics, and a range of patient care/monitoring products. That gave Rusckowski experience in the types of clinical diagnostic services that are performed along with clinical laboratory testing.
How Rusckowski views the opportunities in clinical laboratory testing and anatomic pathology services will be closely watched—and not just by investors and Wall Street financial analysts. Pathologists and clinical laboratory managers whose organizations compete daily against Quest Diagnostics will be just as keenly interested to learn what new strategies and business initiatives Rusckowski implements at his new employer.
In many respects, this new CEO at the nation’s largest medical laboratory company has a blank slate to chart a new course. In so doing, Rusckowski has the potential to initiate innovative business initiatives that not only directly benefit Quest Diagnostics, but would be favorable to the profession of laboratory medicine over the long term. .