Meet the Practitioners of Progress

After a private equity firm bought out Walgreens subsidiary Option Care, Mike Rude’s team designed human resources from scratch to kick off a new era for the infusion care provider

Mike Rude, Option Care (Photo: Caleb Fox)

When Mike Rude joined Option Care as senior vice president and chief human resources officer in August 2015, the infusion services corporation had just been bought by a private equity firm from Walgreens. After seven years as part of a major medical retail operation, Option Care was once again a standalone company in need of entirely new human resources practices, infrastructure, and staff.

Rude inherited seven employees and a payroll system. The rest was up to him to build the department from the ground up. “You can imagine the scope of change we had to make when you compare a large retail company like Walgreens to a much smaller, patient-centered, home-infusion service business,” Rude says. “It required taking a step back and rethinking everything we did—new plans, policies, and practices.”

Since Walgreens had previously managed most of the HR functions, Option Care had no in-house hiring expertise and staffing development. When Rude came on board, there were about 400 open positions with only one full-time recruiter, some contract help, and not a single employee handling compensation. Option Care also lacked a human resources information system (HRIS). Meanwhile, Rude was given a little more than a year to hire a leadership team and put into place essential HR functions.

As part of the purchase agreement with Walgreens, the owners negotiated for employees to stay under the old benefits system until the end of 2016. “We were flying blind,” Rude recalls about the first few weeks on board. “It took me about four days just to put together a turnover report by cobbling together payroll information. It was essentially a total rebuild of an HR system.”

Coming into the role, owners knew they needed to make a sizable investment in the company culture and HR function. Rude teamed up with his CEO and CFO and went to the board asking for incremental resourcing and investment to begin growing that arm of the company. “That support from the board and corporate leadership is part of what attracted me to the position,” he says. “They needed someone who had done something like this before and I wanted to be part of building and creating change.”

Before joining Option Care, Rude was senior vice president of human resources for Catamaran, a pharmacy benefit management company with 5,000 employees and $20 billion in revenue, where he managed the entire HR function for the company. Prior to that, he was vice president of human resources at Stryker, a global medical device company, where he successfully established the role of the company’s first corporate vice president of human resources.

This experience helped him understand the importance of change management in an organization that was undergoing an adjustment in ownership, goals, and practices. “Early on, one of the biggest things we did was introduce our new vision, mission, and values,” he recalls. Rude says it was critical to address the question of: “What is Option Care and what does it mean to work at the company now as opposed to when it was a subsidiary of Walgreens?”

His newly hired executive leadership team made a significant effort to communicate their shared vision early on in the process. The ten-person leadership team split up visits to all ninety-two offices across the United States. They stressed how the vision and values of Option Care would be the basis for how they built the HR functions including hiring, reward systems, and staffing processes.

Rude’s team also introduced new selection tools to help managers make the right hiring decisions. They put into place new orientation and onboarding processes, and are currently working on establishing compensation structures and systems. “Walgreens approached compensation in a way that was different than what we needed within our own industry, which is patient-centered and service-based versus the retail pharmacy industry,” Rude explains.

Option Care also implemented a new HRIS system, Workday. It was the first time employees had an HRIS system, so there was no “conversion pain.” In some respects, Rude admits, creating a system from scratch is easier than converting from an existing system, especially when new technological tools are involved. However, his team did have to engage in significant reeducation when it came to phasing out existing hiring, staff development, and employee relations processes. “We had to change the mind-set that managers had under Walgreens to align with what we wanted Option Care to be. It’s easier for some people than others, especially those who have been ingrained in the old system for a long time,” he says, adding the changes are a work in progress.

The path to creating a new, shared vision for Option Care was paved with a positive initial reaction when the new owners bought Option Care from Walgreens. “Option Care is about 5,000 employees and a $1.5 billion company. We were almost a rounding error when you consider the size of Walgreens,” Rude laughs. “Now you have an owner who’s fully dedicated to the infusion marketplace and could give Option Care its full attention.”

The staff was especially pleased with how quickly changes took place with a smaller management team that could tailor decisions to their needs. “The good and bad news was the bar was set pretty low in terms of the HR function when I got there. We’re going to hit singles and doubles, but they’ll feel like home runs,” Rude jokes with his team.

His team followed through with promises to accomplish important tasks in the early months to establish trust and credibility with the staff, but they are also careful about how much they try to implement at once. Rude knows employees can only handle so much during a year of massive change for a company. He believes it is more important to do a few things well than try to do things too quickly. There will always be competing priorities, and he wants Option Care to be on solid footing when introducing company-wide HR policies and practices.

Rude’s new hires and management team also share his vision of growing the company. “The opportunity to build and create is exciting for some people,” he says, including himself in the group that was drawn to the challenge of building the HR team at Option Care. He adds, “Rather than following rules and maintaining the status quo, we can create the kind of company we want to be.”