Running head: THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 1
The Problem at Kookaburra Beauty Clinic
HCI 344 – Management and Leadership in Health Organizations
Arizona State Univeristy
September 27, 2018
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 2
Abstract
This report examined the problems facing Kookaburra Beauty Clinic (KBC). It is a Chinese
medical Clinic that just opened its services in Australia. Dr. Hao is its CEO, Head Surgeon and
Chief Medical Officer of this clinic. The business is experiencing a lot of problems in Australia
despite the good performance of its affiliate Yan Jing Medical Group in the Chinese medical
market. Dr. Hao is a highly-educated professional who has effectively led the Chinese company
to its success. However, since entering the Australian market, the company has failed to perform
expected by its stakeholders. The business growth is slow when compared with the affiliate Yan
Jing Medical Group Company. The surgeons, nurses who did not have Australian degrees were
not allowed to perform their duties according to the Australian regulations. This forced Dr. Hao
to hire Australian surgeons and nurses. Despite the various interventions such as cutting costs the
company’s results are still poor and employees are complaining. Further analysis explored how
demotivation, burnout, miscommunication, and cultural clashes reduced patient satisfaction,
increased turnover intentions, and triggered reputational and financial risks. Service quality
decline, legal compliance pressures, and potential customer loss were also highlighted as
emerging organizational threats. The first problem identified using the behavioral theory of
leadership was the poor leadership. Dr, Hao lacks of Technical skills, human skills and does not
listen to the ideas of the employees as well as their suggestions. Some of the recommendations to
this problem include creating transparency in communication between Dr. Hao and the
employees and conducting a research to collect data about employees and the Australian market.
The second problem identified using Herzberg two-factor theory was the lack of employee
motivation. The employees are not remunerated based on their performances, they are given
short schedules to perform surgeries, their salaries are not satisfactory, they are not appreciated
for extra work and the work environment is harsh. The recommendations to address this problem
included a pay-for-performance method to ensure that workers are paid for what they have done
and the introduction of employee recognition programs to reward their hard work and
contribution to the KBC clinic.
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The Problem at Kookaburra Beauty Clinic
1. Leadership problem
Leadership is a very vital aspect and function of management of an organization because
it helps in the achievement of the organizational goals as well as the maximization of efficiency.
When leadership fails in an organization, the entire organization fails well. It is because leaders
are at the center of every action that takes place in the organization. Alvesson and Karreman
(2016) asserts that leaders initiate actions and mobilizes the entire team towards a common goal
of meeting client needs and making profit for the organization. When a leader fails to initiate
such actions and play a pivotal role, workers become disconnected from the organization’s goals
leading to demotivation and eventual failure of the organization. Therefore, it is paramount to
note that leadership failure, leaders to poor organizational performance and reputation.
Kookaburra Beauty Clinic (KBC) is a Chinese medical Clinic that just opened its services
in Australia. Dr. Hao is its CEO, Head Surgeon and Chief Medical Officer of this clinic. The
business is experiencing a lot of problems in Australia despite the good performance of its
affiliate Yan Jing Medical Group in the Chinese medical market. Dr. Hao is a highly-educated
professional who has effectively led the Chinese company to its success. He is respect in China
and most employees do not question his decisions. However, there is a problem at KBC in
Australia. Since there were problems getting licenses for the Chinese nurses and surgeons in
Australia because they did not have the relevant degrees, Hao employed Australian nationals to
help him in the running of the organization. Consequently, Dr. Hao exhibits poor leadership
skills to the constant disagreements. Some of the indicators of the poor leadership skills are lack
of good performance despite the heavy cutting of costs, lack of employee remuneration, and
reduction in employee salaries among other interventions.
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Another issue case at KBC is that the leadership style adopted by Dr. Hao does not reflect
the culture and regulations of the Australian employees. There is no universal way of leadership
behavior and as the leader strives to use the same management assumptions in various contexts
tensions and lack of engagement are likely to emerge. According to Behrendt, Matz, and Goritz
(2017), the key to success of the leadership is the balance between the tasks-focused actions and
the sensitivity to relationships, which seems to be wanting in the practice of Hao. In Australia,
employees require increased participatory communication, transparency and tenacity to
professional boundaries, which goes against the hierarchical perspectives widely held in other
settings. Alvesson and Karreman (2016) argue that leadership should work as a response to
organizational conditions and not be based on strict power. Dr. The fact that Hao has not been
able to adapt his form of style has led to resistance and dropped morale. Also, cost-cutting
decisions that are made without consultative discourses have intensified the feeling of aloofness.
When leaders do not recognize the voice of employees, they will inevitably harm the trust and
alignment with the strategic goals will be barely possible (Behrendt et al. 2017). Here, the
cultural incompatibility has also led to the break-down of leadership, which has led to frustration
and reduced performance by the staff.
Motivation and employee satisfaction is another neglected aspect since both are harmed
in cases where leaders place control at the expense of engagement. Alshmemri, Shahwan-Akl,
and Maude (2017) emphasize that the two-factor theory by Herzberg demonstrates how the
dissatisfaction of intrinsic needs beyond recognition and responsibility occurs when they are not
addressed. The decline in salaries and lack of any incentive at KBC has killed the basic hygiene
factors needed to make staff comfortable. In cases where motivation is not taken seriously then
performance suffers and in instances where individuals feel that the leadership is detached or
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does not care about their well-being. According to Behrendt et al. (2017), the idea is that to
inspire beneficial organizational results, a good leader should combine the supportive conduct
with direction and clarity. Without leadership listening to staff issues, commitment cannot be
maintained or cooperation cannot be developed. In addition, leadership based on authority, and
lack of relational investment in personnel tends to make the latter disengage completely, as
suggested by Alvesson and Karreman (2016). All these conditions at KBC disrupt productivity
and harm the clinic to provide quality and consistent services.
The other significant source of the leadership dilemma in the clinic is communication
breakdown. Leaders have the role of stating vision, explaining what is expected, and instilling a
sense of inclusion in the workplace, otherwise employees will run lost. Behrendt et al. (2017)
suggest that integrative leadership models state that coordination between communication
practices and organizational goals is required to ensure that staff can coordinate their efforts, too.
Dr. There has been confusion on the priorities in the operations of the clinic due to Hao having
limited interaction with his Australian staff. In the open dialogue, Alvesson and Karreman
(2016) argue that misunderstandings arise, and opposition also comes up, especially when the
leaders do not create a free communication environment, especially to those employees who are
used to working in collaborative structures. Error of commission KBC has been unable to
respond constructively to emerging issues due to the lack of constructive feedback loops, address
conflicts and spur innovation. Alshmemri et al. (2017) also add that inadequate communication
may increase dissatisfaction since employees may believe that they are disrespected once there is
no response. The early attitude of distrust leads to a decrease of cohesion as well as an increase
in turnover intentions. Until you can improve communication and make leadership more open,
organization stability will be at stake.
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 6
Analysis of the problem
There are various schools of thought on leadership that provides a wide array of
leadership concepts. Behavioral theory of leadership is one of these schools of thought that deal
with the issue of leadership and it provides crucial information on the problem at KBC.
According to Meuser, et al., (2016) this theory focuses on the actions as well as the specific
leaders’ behaviors that affects the running of an organization rather than the characteristics and
traits of the leader. Behrendt, Matz and Goritz (2017) states that effective and efficient leadership
is based on the various learned skills and individuals need three basic skills in running an
organization. One of them is human skills, technical and conceptual skills.
In reference to Dr. Hao, he exhibits lack of Technical skills which is the knowledge of the
techniques and processes of running the organization. For instance, Dr. Hao believes in shallow
techniques in increasing the performance the Clinic. He imposes salary cuts; he cuts costs even
on crucial resources needed in running the organization. He invests heavily on the
advertisements without taking into consideration other internal factors such as employee
motivation and listen to employees. This problem leads to continued poor performance despite
the cost cuts. Additionally, Nothhouse (2018) states that human skills are crucial and are
achieved through integration. However, Dr. Hao does not listen to his employees and he believes
that the Australian employees are rude and disobedient whenever they question him questions or
make comments on various decisions. Listen to employee grievances and suggestions is a good
quality of leadership that Hao lacks. Dr. Hao also lacks conceptual skills which are crucial in
making decisions suitable for the company. He cannot generate ideas and accept ideas for his
employees. He does not differentiate or research on the differences between the Chinese
corporate values and market to help him take his company to the other level.
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Recommendations
i. Transparent communication
The biggest problem facing KBC is a poor communication transparency between the
management and the employees. Dr. Hao should communication policies effectively to his
employees and he should learn to listen to their grievances and suggestions. He should not
should at them as a way of silencing them during corporate meetings to instill fear. This allows
the employees to freely express their concerns and voice alternative solutions to KBC’s problems
they are the ones who understands the patients and the work environment in Australia more than
him.
Justification
Communication is one of the fundamental pillars to good performance in an organization.
Hellinger (2018) asserts that effective leadership is leadership that takes into account the
concerns of every employee in the organization as well as the stakeholders. When this done,
employees provide practical solutions to problems and apply them in their daily activities and
duties hence impacting the performance. Additionally, it helps in problem-solving processes it
gives an opportunity to facilitate an effective open dialogue with the management that trusts their
intentions for the company (Hellinger, 2018). In so doing, employees and leaders provide
specific and practical solutions to the problem.
ii. Research and collect data about employees and the Australian market.
Technology plays crucial role in today’s management of organizations. Therefore, leaders
should use technology to research key problems facing the organization. At KBC, the major
problem is with the employees and the new corporate environment. Dr. Hao should take time to
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research about the characteristics and expectations of Australian workers and understand what
makes them happy. He should also research on the aspects of the Australian cosmetic surgery
industry because it is quite different from the Chinese cosmetic market. In so doing, he will be
able to mobilize the employees with the right information and knowledge without conflicts.
Justification
The internet provides great volumes of data on all leadership aspects as well as market
needs. Hellinger (2018) articulates that through research, an organization is able to identify
employee behavior in various regions as well as some of the legal obligations that leaders have
towards the welfare of such employees. Cutting on costs, pensions and medical cover to increase
provide the way Dr. Hao did, is unacceptable in countries such as Australia. Through research
Dr. Hao can identify some of the key customer behaviors which in this case are complaining
about the lack of attention from the surgeons and nurses. If this is done, more customers will
appreciate the services of KBC and will likely refer their friends and families leading to
increased performance.
2. Lack of Employee Motivation
Motivation among employees is attributed to over 45 percent of the organizational
performance across all industries in the world. Mikkelsen, et al., (2017) suggests that keeping the
employees of an organization engaged and motivated leads a boost in their morale, it creates a
work environment that is dynamic, it reduces turnover and it leads to a profitable operation. It is
important to note that there are different things that motivate different employees in an
organization. Also, Mikkelsen, et al., (2017) adds that there are numerous practices that
demotivate employees and impact of their performances negatively and which in the long run
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affects organizational performance. Identifying such problems and correcting them could lead to
improvement of performances and a better working environment.
The lack of motivation among the KBC employees is quite evident through their
utterances and the entire situation facing the organization. There are numerous demotivating
practices imposed by the management in the process of cutting costs as well as the misdemeanor
of the Dr. Hao that is affecting their morale. For instance, in this organization, there is no clear
leadership structure. The KBC organization structure looks disorganized because the despite Dr.
Hao being at the top of the leadership hierarchy, the structure below him is unstructured. Despite
having been informed that the Chinese surgeon and nurses were not qualified, he still went on to
include them in the running of the business which confuses the Australian nurses and doctors.
This has led to resentment and a lack of a proper direction in the clinic. The other thing
demotivating these workers is disorganized directives and hazy goals. Additionally, he the
company despite the hard work of each employee, there is no praise or bonuses for the extra
work. The Australian surgeon that does 20 successful surgeries is not given a bonus. This means
that he is demotivated and is likely to underperform because of the lack of motivation.
Problem analysis
There are various factors that demotivate employees in an organization and at KBC, these
factors are quite evident. Alshmemri, Shahwan and Maude (2017) assert that the Herzberg’s two-
factor theory explains some of the key factors that cause demotivation among employees in an
organization. According to this theory, which is also known as the motivation-hygiene theory, it
is stated that there are motivational factors that bring about employees’ job satisfaction and
additionally, there are other factors also known as hygiene factors that brings about their
dissatisfied and these are those factors that defines the working environment. Alshmemri,
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Shahwan and Maude (2017) indicates that Herzberg cites these hygiene factors as factors such as
the working conditions, the salary, the work environment, workers’ security and safety. When
these conditions are not satisfactory, employees are likely to be unhappy and dissatisfied with
their jobs.
This theory, highlight the key problems facing KBC employees. For instances, their work
environment is not a conducive one because they work under very strict schedules. It is identified
in the case that surgeons are only allowed to operate one patient within a time from of ten
minutes and even an extra five minute is a big problem. Most of the Australian surgeons
indicated that they needed at least an hour and extensive prior meetings with patients. This has
made them unhappy about the policy on time and hence demotivated to work. In the Herzberg
five factors of motivation, recognition is one of them (Alshmemri, Shahwan & Maude, 2017). At
KBC individual work performance is not recognized and the example of the surgeon asking for a
bonus and is denied by the management after twenty successful surgeries is a good example. The
salary is also the other motivational factor because it is an appreciation of an employee’s
achievement. At KBC, salaries are quite low for both the Chinese and Australian employees due
to the need to cut costs. One of them is complaining about the poor pay among the Chinese
employees. The interpersonal relationships and supervision are also identified by this theory as
key motivational aspects (Lazaroiu, 2015). The employees at KBC have constrained
relationships among themselves and with the administration. Chines employees feel that the
Australian employees are paid more than them and all of them feel that the administration is
unfair to them.
Another problem in KBC that correlates with behavioral leadership theory is that there is
a disconnect between the leadership behaviors and employee expectations. According to Meuser
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et al. (2016), behavioral models underlie the influence of observable behavior of leaders to
confirm the employee outcomes and organizational performance. The actions of Dr. Hao in this
case would be those of an authoritarian style where orders are given without involving or
consulting. According to Moorhead and Griffin (2008) contemporary organizations are on the
need to employ participative leadership practices that allow these organizations to foster trust,
problem solving, and innovation. Employees not being included in the decisions will less likely
make a commitment to the objectives of the organization and will tend to be disengaged. The
failure to consult the staff members when introducing cost-cutting or any changes occur in
operations is evidenced by the lack of consideration of human skills, which Northouse (2018)
views as a key element in impacting employees favorably. These patterns of interaction have
caused confusion, frustration and lowered morale throughout the clinic. Even though Dr. Hao
might have good medical experience, it is also a new environment and leadership demands
flexibility to accept local norms and expectations in the work environment. Inability to change
his ways has consequently sustained intra-personal wrestling and unhealthy collaboration.
The other aspect of the leadership issue in Dr. Hao is related to the improper management
of staff motivation and job-satisfaction. Lazaroiu (2015) observes that motivation is a
determining factor on how workers will match their output with the organizational goals and
commitment in the long-term. Very little of this has been more applicable to the external controls
and punitive measures employed by the leadership at KBC instead of intrinsic motivation. By
comparing and contrasting the conditions where leaders implement strict orders without taking
into account how the workers view the new values or regulations, Mikkelsen, Jacobsen, and
Andersen (2017) concluded that the intrinsic motivation will decrease significantly and lead to
the low levels of engagement and lack of performance. Staff demotivate and de-motivate through
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the reduction of salaries, absence of recognition and development opportunities discourage staff
loyalty. Northouse (2018) notes that leaders need to recognize the involvement of employees in
order to foster the feeling of belonging. The atmosphere that Dr. Hao creates seems to be rather
callous to the idea of employee empowerment or the recognition of their role in the company,
which makes things even less satisfactory. These leadership failures leave a workplace where the
staff are tasked only with complying with commands but not with make efforts out of
commitment, resulting in little discretionary effort in the performance of duty or creativity in
problems-solving.
The KBC also lacks effective human skills in its communication practices as shown by
the leadership framework. According to Moorhead and Griffin (2008), communication plays a
significant role in the formation of organizational culture, conflict mediation, and
communicating the strategic intent. In the event that the leaders cannot express their plans or are
not responsive to feedback about employees, uncertainty and resistance arises. To the case of Dr.
Hao, he makes dismissive remarks about staff views which makes it look like employees do not
matter. Mikkelsen et al. (2017) argue that these perceptions diminish a sense of fairness among
employees and erode morale, particularly where the leadership decisions have an impact on the
well-being of the employees. Meuser et al. (2016) also imply that behavioral leadership theory
leads to the thesis that reflective and respectful interaction remains the focus of the team
cohesion and clarity. Rather, lack of communication at KBC has created an obstacle to aligning
employees to organizational changes and seeing the reasoning behind cost-cutting decisions.
Northouse (2018) focuses an additional problem of leaders to establish trust and cooperation
through the establishment of two-way communication, especially in the culturally diversified
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environment. In the absence of this, resistance of employees will be entrenched and the
organization will not be able to realize strategic goals successfully.
Dr. Hao also fails to reconcile cultural differences in management style, which worsens
the situation of the clinic. Meuser et al. (2016) note that there is a growing number of leadership
theories acknowledging the significance of contextual and cultural adaptability implying that
behavior that works effectively in one set-up may not be transferred effortlessly into a new
setting. In China, workers have no reason to resist rigid hierarchical governance, whereas in
Australia people are more likely to prefer participatory governance and respect towards each
other. As Moohead and Griffin (2008) observe, most misunderstandings are usually experienced
when leaders implement foreign business norms without analyzing the local expectations.
Northouse (2018) also emphasizes that conceptual skills also encompass the possibility of
appreciating situational constraints and adjusting to them. Dr. The assumptions that Hao has on
obedience and non-questioning compliance are in conflict with the Australian focus on
collaboration leading to conflict and mistrust. Lazaroiu (2015) follows with the fact that cultural
incompatibilities may have a direct influence on motivation when employees make themselves to
be underestimated or misunderstood. Therefore, the lack of cultural awareness has intensified the
problem with leadership, as it marginalized personnel and reduced the possible advantages of a
diverse team.
Decision-making within the leadership of Dr. Hao continues to demonstrate a weakness
in conceptual skill building particularly in the aspect of strategic planning and organization
learning. Northouse (2018) defines conceptual skills as needed to make sense of complex
situations, to weigh options, and develop long-term solutions. Instead of getting to the bottom of
underperformance causes, Dr. Hao has sought mere fixes like reducing wages and generic
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advertising campaigns. Mikkelsen et al. (2017) state that successful managerial decisions are
made by including employee feedback, performance measurements, and contextual analysis to
conclude on appropriate interventions. Moorhead and Griffin (2008) also argue that attending to
the external image to ignore internal factors in operations will be counterproductive in service
based industries. By not researching regulatory needs, culture, and employee issues, Dr. Hao, in
its turn, restricts innovation and maintains unproductive traditions. According to Meuser et al.
(2016), the combination of multiple leadership perspectives can lead to better decision making
and increase the organizational resilience. Lack of the desire to change and reflect makes the
leadership reactive, but not strategic, which weakens the competitiveness of the clinic.
The effects of these leadership failures can be seen in the form of deteriorating
organizational performance, employee loss and tarnished reputation. As the example by
Mikkelsen et al. (2017) shows, employees tend to reduce their efforts or leave the company when
enforcement measures outweigh the supportive engagement. Another issue highlighted by
Lazaroiu (2015) is that the lack of motivation can result in more conflict, absentees, and low
customer satisfaction, particularly in service-based areas as the healthcare sector. As stressed by
Moorhead and Griffin (2008), these conditions are domains of disenchantment, where leaders do
not put in place comforting structures, do not reward success, or allow collaborative decision-
making. Northouse (2018) argues that success in leadership relies on the ability to align vision,
people and processes. The current direction of KBC shows that this alignment was partly broken
as Dr. Hao has not acquired the behavioral skills key in a foreign market. Meuser et al. (2016)
also state that the integration of leadership is a dynamic process that should be carefully adapted
with the course of time. Unless these behavioural and motivational gaps are resolved early
enough, then the clinic runs the risk of continued decline in service provision and sustainability.
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Impact on Employee Performance and Productivity
The problem of leadership failures and structural ambiguity at KBC have led to the
inefficiency breakdown of employees and the coordination of workflow. According to the theory
of behavioral leadership, it is a theory that considers leadership to be determined by actions,
communication, and decision-making as opposed to leadership titles or credentials. Lack of
direction, role clarity and participative management has adversely affected day-to-day
performance at KBC. Uddin, Luva, and Hossian (2013) argue that a lack of organizational
culture and disorganized leadership practices are the real obstacles to productivity because they
cause confusion of expectations and duties. According to Shahzadi et al. (2014), employees tend
to be less interested in their work when it is not clear where the leadership intends to head or the
direction the organization has to follow. Denying the staff the right to contribute to the decision-
making process or to be listened to regarding issues of professionalism further creates the feeling
of being denied a sense of belonging and integration, thereby lowering efforts and cooperation.
Gunaseelan and Ollukkaran (2012) further contribute that inconsistent management practices in
the workplace usually trigger dysfunction in service delivery as an employee feels unidentifiable
with larger organizational objectives. Hierarchical leadership as imported in a different cultural
environment has as one consequence in KBC increased misunderstanding, diminished internal
coordination and the resultant operational inefficiencies that are directly devastating to
performance standards and client service performance.
A major issue contributing to poor productivity at KBC is the neglect of motivation
factors that drive workplace commitment and engagement. Herzberg’s hygiene factors; such as
salary fairness, policy clarity, and respectful supervision—must be adequately met to prevent
dissatisfaction and withdrawal behaviors. However, cost-cutting measures, reduced pay, and
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limited communication at KBC have signaled disregard for employee well-being. Shahzadi et al.
(2014) emphasize that employee motivation is strongly influenced by leadership actions that
acknowledge their needs and contributions. When staff feel undervalued or dismissed, their
performance diminishes regardless of their capability. Uddin et al. (2013) also argue that
organizations with weak motivational climates experience increased resistance to leadership
directives and lower levels of cooperation. Furthermore, Gunaseelan and Ollukkaran (2012)
show that poor work environments undermine productivity because stress and dissatisfaction
reduce cognitive focus and task engagement. Leadership behavior that fails to protect hygiene
factors therefore accelerates burnout and presenteeism. In KBC’s context, employees are
expected to perform under demoralizing conditions created by unilateral decisions, absence of
recognition, and culturally insensitive leadership. These motivational deficits translate into
reduced efficiency, higher turnover intention, and compromised service quality.
The issues of productivity at KBC get aggravated by the lack of staff development
initiatives that would improve competence, adaptability, and confidence. Behavioral leadership
theory associates the importance of skill-building with the leadership function, however, there
have been no significant efforts to train or guide employees on the expectations of the
organization. Sal and Raja (2016) discovered that continuous training can significantly increase
employee output by the improvement of their technical capabilities and task ownership.
Similarly, Nda and Fard (2013) maintain that development programs assist employees in
performance alignment with organizational standards as well as in the increase of job
satisfaction. Untrained staff at KBC as a result are still ill-equipped to handle administrative,
clinical, and customer service situations in the right way. Gunaseelan and Ollukkaran (2012) also
mention that lack of resources, guidance, or structured learning in certain environments result in
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inefficiency and frustration of workers in the workplace. The difference between the demands of
leadership and the support of employees at KBC has led to a situation where staff members are
working in a reactionary manner instead of taking the initiative. Poor funding of training only
serves to limit the operational activities to the maximum, and at the same time, it also acts as a
roadblock to the employees adopting the care and professionalism standards that are of the
Australian market. As a result of this, skill stagnation becomes a contributing factor to the
reduction of output, slowdowns in service delivery, and the existence of poor coordination across
teams.
Organizational culture at KBC has been one of the reasons why the organization is not
performing at its best as the leadership behavior has created a climate of mistrust and
disengagement. Uddin et al. (2013) show the direct influence of organizational culture on the
productivity when employees consider managerial actions as either supportive or threatening.
The lack of transparent communication, unwelcoming reactions to feedback and the absence of
collaborative leadership practices have, among others, led to a culture of silence and resentment.
Shahzadi et al. (2014) are of the view that the performance falls dramatically when employees
feel that their suggestions are not listened to or are of no use. The organizations such as these are
lacking in psychological safety, they keep their members from taking on responsibility, and have
less teamwork. Moreover, Gunaseelan and Ollukkaran (2012) add that organizations with
restrictive cultures lose morale over time and their service performance goes down as a result of
the increased tension and poor interpersonal relationships. Herzberg's hygiene elements, in
particular, working conditions and interpersonal relations, become more problematic when
communication is authoritarian and disrespectful. At KBC, employees are deprived of any
significant means to raise their voices or impact decisions. This long-standing cultural imbalance
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has the effect of diminishing the efforts, restricting the pool of new ideas, and promoting the
attitude of doing the bare minimum rather than actively contributing. In the absence of a cultural
overhaul guided by leaders with behavioral competencies, the operational improvements made
will most likely not succeed.
Decreased productivity at KBC is indicative of the larger divergence between what
employees expect and how the leadership is acting. According to Shahzadi et al. (2014),
employee performance is optimized when employees experience treatment that is fair,
recognition, and an opportunity to progress. KBC's management, on the other hand, seems to
have gone the opposite way by focusing on control, cutting down on expenses, and external
image without considering the impact of these measures on internal cohesion. Sal and Raja
(2016) are of the opinion that employees will be in their best performance when they are well
supported and given the necessary tools to achieve organizational goals. Moreover, the lack of
developmental support, the nonexistence of motivational strategies, and the authoritarian
disposition of the leadership have resulted in employees disengaging from their work.
Gunaseelan and Ollukkaran (2012) point to the fact that the standard of the work environment is
the basis for the productivity of the employees, and these are environments such as stress and
uncertainty that lead to underperformance. According to the behavioral leadership model, leaders
should demonstrate through their actions the traits that they expect employees to show, e.g.,
teamwork, respect, and adaptability. Nonetheless, the top management at KBC has always given
a picture of being strict and inconsiderate, thus, they have been largely responsible for the
unbridgeable gap between the attainment of goals and employee performance. In the absence of
a management reorganization that would result in the change of leadership behavior tackling
motivation, communication, and support for the workplace, the productivity of employees will
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inevitably continue on a downward spiral thereby adversely affecting the clinic’s service
standards and long-term stability.
Impact on Service Quality and Patient Satisfaction
Healthcare service quality is largely dependent on the morale of the staff, the flow of
communication, and leadership responsiveness, all of which are currently weak at KBC. The
demotivation among the employees in Australia has led to a decrease in the consistency and
attentiveness that were required to be presented to the patient needs. Al-Damen (2017) argues
that the satisfaction of the service in the health sector is reliant on the technical part of the care
only if it is combined with the relational and interpersonal experiences the staff have with
patients. At KBC, the lack of encouragement and acknowledgement has resulted in the decrease
of employees' emotional engagement with patients, consequently fewer empathy, longer
response times, and lower attentiveness. Zarei et al. (2014) confirm that the judgement of service
quality is the first time through staff interactions at reception, consultation, and follow-up. If
internal motivation fails, then these touchpoints suffer. In addition, Australian workplace
standards point out that respect, communication, and fairness are the key factors that are not
present in Dr. Hao’s management style. Patients in Australia are looking for a service model
where professionals not only are successful but also visibly engaged with their works, thus staff
disengagement is especially harmful to satisfaction and retention.
Internal miscommunication at KBC that has negatively impacted patient experience by
the co-existence of the methods of delivery, the coordination of appointments, and the follow-up
care. Khan and Fasih (2014) maintain that customer satisfaction is largely associated with
dependable and predictable interactions ; thus when communication fails, dissatisfaction
escalates rapidly. At KBC, the decision-making and clarifying of expectations by leadership have
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not empowered the flow of correct information among the administrative staff, clinicians, and
patients. Rao and Sahu (2013) underline that the quality of the effective service depends on the
combination of the back-end processes with front-end delivery and that the poor communication
is the main cause for the separation of these chains. In the Australian healthcare context, patients
are looking for openness, cooperative care, and promptness, hence communication failure can be
easily detected. Farooq et al. (2018) found that inconsistency in messaging leads to lack of
consumer trust because it reflects the disorder of the operations. The aftermath at KBC is an
increase in appointment errors, misunderstandings about treatment plans, and waiting for service,
which not only lowers satisfaction but also leads to the creation of negative word of mouth.
Without a change of leadership, communication failures will perpetuate, thus, both service
consistency and patient trust will be undermined.
Low morale among the staff at KBC has led to a decline in the level of the attentiveness
as well as the personalization of the service that patients expect in Australian clinical settings.
Zarei et al. (2014) discovered that the satisfaction of the patients in healthcare institutions is
mostly influenced by the staff's mentality, their responsiveness, and their readiness to address
patient concerns. Nonetheless, management decisions like pay cuts, not taking feedback
seriously, and using an authoritarian approach have led the employees to emotionally disengage
with their jobs. Khan and Fasih (2014) emphasize that demotivated staff, who are thus only
performing the minimum necessary, thereby making patient experiences and impressions
negative. In Australian workplace culture, warm, patients oftentimes polite communication and
respectful interaction from healthcare personnel are what is expected. When staff due to
declining job satisfaction become distant, patients see it as unprofessionalism or negligence.
Farooq et al. (2018) go on to say that even in industries that are completely different from
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 21
healthcare, customer loyalty gets damaged and long-term trust weakened by unmotivated
employees. At KBC, staff have gone from being enthusiastic and caring to indifferent, resulting
in less patients coming back and complaints about the clinic's interpersonal standards.
At KBC, fluctuating leadership has been the main cause of the decline of patient
satisfaction that has resulted from the operational instability. To be precise, Al-Damen (2017)
illustrates how stability in healthcare organograms can lead to better service planning and thus
patient-centered delivery. Nevertheless, KBC’s leadership neither gives clear procedural
guidance nor facilitates collaborative problem-solving, therefore the standards of treatment are
found to be varying. Rao and Sahu (2013) claimed that service quality will be negatively affected
if leadership overlooks internal processes in favor of making changes only at the surface.
Furthermore, the demotivation that misaligned leadership may cause results in service
variability, whereby patients can experience dramatically different levels of treatment depending
on the staff members who have been most affected by workplace stress. Zarei et al. (2014) also
point out that inconsistency in service leads to patients’ lack of trust and decreases the number of
patients who return to the hospital. The Australian healthcare system relies heavily on
predictability, communication, and patient dignity which are the main features that are not
present in the daily operations at KBC. Farooq et al. (2018) stated that if staff support is lacking,
performance will be fragmented and patients will have partial or discourteous service
experiences. Without organizational cohesion, patient satisfaction will continue to be
undermined.
Patient perceptions of quality care at KBC have got a lower score from their experiences.
These include the staff-patient communication which has become less and less due to a great
change of management and emotional fatigue. Rao and Sahu (2013) hold that efficient
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 22
communication networking deepens service relations, which invariably results in the process of
setting up more clear expectations. Nevertheless, at KBC the staff's poor communication often
leads to patients getting different information from staff on their appointment times, costs, and
follow-up procedures. Al-Damen (2017) brought out that the communication errors which occur
in healthcare lead to mistrust and anxiety among patients, and hence the level of satisfaction
decreases. In the healthcare culture in Australia, patients desire and expect collaborative
engagement, open dialogue, and transparent consultations. However, the internal climate at KBC
has turned staff members into the ones less willing to take a step forward in these areas. Farooq
et al. (2018) state that good communication is one of the tools for increasing customer loyalty,
and the lack thereof is capable of damaging an organization's reputation. Moreover, Zarei et al.
(2014) found that service failures due to customer misunderstanding of the messages delivered
have also resulted in lowered perceived care quality. The internal dysfunction at KBC has thus
gone beyond the staff coordination that has been weakened and has even impinged on patient
confidence and satisfaction due to communication failures at different stages of service.
Not meeting Australian workplace expectations has escalated frustration by revealing a
significant gap between what patients expect and the actual service they receive. Those in
Australia are used to medical settings where employees are rights-respected, collaboration is
encouraged, and professional accountability is observed. Thus, when these standards are absent,
patients immediately observe the resulting tension and low staff morale. Khan and Fasih (2014)
claim that the quality of service and satisfaction are mutual dependent, that is, failure in the
welfare of employees would be visible in their customer-facing interactions. Meanwhile, Farooq
et al. (2018) emphasize that the service sector with the highest service expectations is the one
that requires the strongest emotional labor from the staff to satisfy the consumers. At KBC, the
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 23
staff who are frozen by the feeling of not being heard or disrespected find it difficult to show the
necessary empathy and patient-centered care. Zarei et al. (2014) say that the quality of
interaction is a main factor for the satisfaction of patients in the clinic, and staff who are
indifferent or overwhelmed result in patients perceiving the whole service as inadequate. Al-
Damen (2017) is one of those who support the idea that the patient trust is lower when the
service environment is going through internal conflict. In the end, it is the leadership behavior vs
Australian professional standards that has most impact on patient experience in a negative way
and that has been the cause of the loss of KBC's credibility in the local healthcare market.
Impact on Staff Retention and Turnover Intentions
The loss of skilled labor at KBC has been the result of a staff retention decline, which in
turn has been caused by leadership actions that are not only causing job dissatisfaction but also
psychological strain. The employees are at a point where they lack recognition, communication
is very limited, and they feel that their well-being is completely neglected. All these situations
lead to the need for a staff with the intention to leave the organization. Qazi, Khalid, and
Shafique (2015) state that the desire to turnover is usually the result of undervaluation, lack of
support, or feeling of separation from the work environment. The example of KBC shows that
the dissatisfaction has been escalated by salary cuts, supervision in a rude manner and exclusion
from decision-making. Perreira, Berta, and Herbert (2018) say that the issue of justice in the
organization along with fairness as perceived by the employees are the main factors that lead to a
decrease in turnover intentions. However, Dr. Hao’s management style is characterized by
secrecy and lack of standardization, thus leading to low levels of organizational justice. Without
even the basic fair practices and emotional support from management, employees start to
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 24
disengage and think of leaving the organization as the most logical solution to their predicament
at work.
Burnout is also one of the reasons that the employees at KBC are considering leaving the
company. Indeed, staff members are required to work under such difficult and depressing
conditions that it should come as no surprise to anyone that they suffer from burnout. In their
study, Naseer et al. (2017) established that the leadership style is a key factor that can accurately
determine the turnover intention, particularly in healthcare settings where emotional labor is
high. Dr. Hao's dominating way of leading, his barely-passable communication skills, and the
pride that is low have, unfortunately, been accompanied by two nasty characters, namely,
emotional exhaustion and depersonalization. Cho and Lewis (2012) note that burnout, first of all,
destabilizes the psychological commitment and, secondly, tolerance for the manager's
imperfections decreases. At KBC, employees are experiencing work pressure to the extent that
they are pushed to disengage because they do not get support or recognition from the
management. The different types of pressure experienced by employees, without resources or
time for relaxation, lead in most cases to resignation as a way out from the situation.
Turnover intentions have been escalated by cultural incompatibility, as it has produced
misunderstanding and mistrust between leadership and employees. KBC’s leadership model is
heavily influenced by the traditionally structured Chinese office culture, whereas Australian
employees are more inclined to expect a leadership style that reflects collaboration, transparency,
and mutual respect. Qazi et al. (2015) argue that employee retention becomes a challenge when
there is a discrepancy between leadership behaviors and employee expectations. Naseer et al.
(2017) add that non-adaptive leadership styles lead to the morale of the staff being eroded,
loyalty reduced. KBC has been impacted by cultural rigidity in such a way that employees
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 25
describe the organization as one in which they get disrespected or even ignored when they try to
engage. This disconnection from the workplace discourages participation and initiates turnover.
Perreira, Berta, and Herbert (2018) contend that staff commitment in the health sector is
emotional and thus it is impossible to be there when employees feel culturally detached.
Gradually, this confrontation deepens the feeling of anger among staff and they become more
likely to consider leaving their jobs.
Turnover intentions at KBC are indicative of the combined influence of demotivation,
burnout, and the feeling that the corporate culture expectations have not been met. In their study,
Cho and Lewis (2012) found that turnover is not just a reaction to a single event but rather a
result of the employee's repeated experiences of dissatisfaction and feeling of unfairness. At
KBC, employees are facing a salary cut, reduced autonomy, and severe cost-cutting measures
besides the leadership behaviors that are disrespecting the Australian employment ethos.
Retention, Perreira et al. (2018) say, is possible when employees are given the value, trust, and
support, but under the current structure, these do not seem to be the case. Naseer et al. (2017)
also point out that leadership changes are a must if there is an intention to reverse the turnover
situation, particularly in a clinical setting where the interpersonal relations have a significant
impact on the staff's performance. Without modification of leadership style, communication
pattern, and cultural sensitivity KBC will be losing more employees which will in turn degrade
service quality and organizational stability.
Reputational and Financial Consequences for KBC
The Kilmore Bushfire Conservation (KBC) clinic has been in a real mess due to the
leadership failures and employee relations issues. Besides the high professionalism in medicine,
the client's loyalty and love for the hospital brand depend very much on the service's overall
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 26
quality, including engagement, communication, and staff performance. Zarei et al. (2014) point
out that the link between patient satisfaction and perceived service quality is very close, and thus,
if staff are demotivated or disengaged, the organization’s public image will decline. At KBC, the
nonsensical treatment of employees and the subsequent drop in service standards are like a
double-edged sword that breaks the trust and decreases the level of professionalism of the clinic.
Shahzadi et al. (2014) found that motivated employees energize the organization's reputation by
good communication and service delivery. When leadership decisions hit morale in the wrong
spot, the troubles will be there for the patients to see, thus affecting public opinion and long-term
brand positioning. Poor perception among clients can also lessen referrals and the clinic's ability
to compete in the Australian healthcare market.
Due to the results of internal mismanagement and declining staff performance, the
operational costs at KBC continue to escalate. Gunaseelan and Ollukkaran (2012) state that poor
work environments lower productivity and create inefficiencies which consequently raise
operational expenses. Staff disengagement, coordination failures, and communication
breakdowns at KBC cause service delays and the occurrence of errors which, in turn, increase
the organization's costs directly. Furthermore, employee turnover compels the organization to
incur the costs of recruitment and onboarding that it does not offset with productivity gains. Nda
and Fard (2013) claim that committing resources to staff development is the surest way of
achieving effectiveness, and lowering long-term expenditures; however, KBC has gone a totally
opposite way. The absence of training and lack of support not only aggravate performance but
also lead to a cycle of operational disruptions. Employees' dissatisfaction leads to financial
hardship which is escalated when a decrease in the quality of care is followed by the organization
having to handle customer complaints, refunds, or reputational damage control efforts.
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 27
Legal compliance risks add to KBC’s financial and reputational vulnerability, which are
already serious enough. Healthcare sector needs strict following of the workplace regulations,
professional conduct standards, patient safety laws, etc. Uddin et al. (2013) underline that
organizational culture is a main determinant of whether compliance will be kept or abandoned,
and KBC’s present milieu is a portrayal of non-compliance with employee rights and
consultation requirements. The clinic may be subjected to fines, interrogations, or rap special
inspections if the grievances become complaints to regulatory bodies or labor authorities. The
salary cuts, lack of consultation, and culturally insensitive practices may also be under Australian
employment law to see if there is any breach. Shahzadi et al. (2014) suggest that once the
employees’ dissatisfaction becomes the driving force of formal complaints, credibility can be
further diminished if such complaints become public. Noncompliance with local expectations for
operations may lead not only to financial penalties but also suspension of licenses or issuing of
public warnings by oversight agencies, thereby causing further instability of the organization.
Most customer churn risk is, however, not only increased by internal dysfunction but also
by the fact that patient expectations are left unfulfilled. Zarei et al. (2014) state that the quality of
service has a significant impact on whether patients stay loyal or look for alternatives. At KBC,
less attentiveness, communication problems, and lack of care consistency have not only led to
satisfaction decline but have also brought the clients to the competing clinics. Farooq et al.’s
(2018) point of view on loyalty in service-based industries says that bad customer experience
leads to very quick disengagement, especially in the case of having easy access to alternatives.
Shahzadi et al. (2014) also discovered that low employee motivation leads to quieter customer
interactions which in turn accelerates churn. The revenue of KBC will go down as more patients
will be discontented with the service and thus the clinic will lose its market position. In
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 28
healthcare, word-of-mouth has a great impact, and negative patient stories can, therefore, spread
quickly, especially in local communities. In short, bad leadership, therefore, is the cause of
inefficiencies in the internal operations which directly breach patient trust and retention.
KBC's financial future will be jeopardized if current leadership practices remain
unchanged. Sal and Raja (2016) emphasize that investing in staff development pays off with
productivity and performance improvements which, in turn, result in the company’s financial
sustainability. Instead of that KBC has been on a completely different trajectory by cutting
wages, withholding training, and ignoring employee feedback. Gunaseelan and Ollukkaran
(2012) stress that workplaces that lack support become the grounds for absenteeism and mistakes
that are the causes of increased costs in the long run. Without changes in culture and leadership,
operational inefficiencies will continue to use up resources, while there will be less money
coming in as a result of regulatory backlash and customer loss. Uddin et al. (2013) point out that
organizations with negative internal climates have issues dealing with reputational harm because
of the continuous inconsistency of service quality. When the financial problems become more
severe, the organization will be dependent upon drastic restructuring or external intervention to
survive. If proper measures that are in line with leadership, staff morale, and patient expectations
are not taken then KBC will almost certainly be facing long-term financial instability and brand
deterioration.
Recommendations
i. Pay-for-Performance Programs
There is a need for the management at KBC consider paying the employees for their
performances. This could be done effectively through having a well-drawn wage incentive plan
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 29
which ensures that every employee receives incentives based on their performances (Lazaroiu,
2015). There should be profit sharing among the employees and the other stakeholders as a way
of making them part of the organization’s success. Also, lumpsum bonuses instead of denying
them bonuses for extra work done. Piece rate pay plans will also ensure that workers are
remunerated depending on the units produced or the job they have completed.
Justification
Pay-for-performance method of remunerating employees is practical because it ensures
that workers are paid for what they have done. Lazaroiu (2015) articulates that this is a
motivating method of payment because it leads to increased satisfaction among employees and a
higher performance on the organization. If KBC’s management takes this into consideration, it
will be able to motivate all employees including the one that complained about doing twenty
operations and does not receive any bonuses. It will improve its performance because surgeons
will invest more time into their work to earn more leading to increased performance.
ii. Employee recognition programs
Since employees are the key stakeholders of an organization, recognizing their efforts is
paramount. KBC should set up a program that identifies and measures employee performances.
After such assessments, performing employees should be awarded with titles such as the
employee of the month among (Moorhead, 2008). Also, considering giving them bragging
boards to communicate their performances can motivate them. Monthly awards and camps cards
could also make employees appreciated.
Justification
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 30
Employee recognition offers a lot of advantages both to the employees and the
organization. If KBC adopts this strategy, it will be able to make their demotivated and
constrained relationships among employees and the clinic management improve. Appreciation of
employees is a vital part of human need in the workplace. Moorhead (2008) adds that when the
management shows appreciation to employees for their effort and good work, they feel
important, valued and they react positively which in turn affects the company’s performances
positively.
THE PROBLEMS AT KOOKABURRA BEAUTY CLINIC 31
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