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3 ORGANIZING THE WORKPLACE Exploring the Fundamentals of Organizing Structures
Starting Point
Go to www.wiley.com/college/Lombardi to assess your knowledge of the basics of workplace organization. Determine where you need to concentrate your effort.
What You’ll Learn in This Chapter ▲ Traditional and more recently developed organizational structures ▲ Functional, divisional, and matrix structures ▲ The importance of teams and teamwork in today’s health care workplace ▲ Trends and changes in organizing the health care workplace ▲ Organizational tools such as divisions, committees, teams, and task forces
After Studying This Chapter, You’ll Be Able To ▲ Compare formal and informal organizational structures ▲ Employ common team structures ▲ Analyze ways in which health care organizations are adapting to workplace
trends ▲ Compare organizational design options
Goals and Outcomes ▲ Master the terminology and tools related to organizational structures ▲ Choose the best organizational structures—including functional, divisional,
and matrix structures for various situations ▲ Compare the purposes of teams, committees, divisions, and departments as
organizational structures ▲ Respond effectively to organizational trends and changes ▲ Use delegation techniques ▲ Establish subsystems within organizations ▲ Design effective, efficient organizations ▲ Evaluate the effectiveness of organizational structures
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3.1 UNDERSTANDING COMMON ORGANIZATIONAL STRUCTURES 53
INTRODUCTION Health care organizations are trying a variety of new forms and structures in the quest for greater productivity, improved patient care, and competitive advantage. Some organizations follow traditional patterns based on functional, divisional, and matrix structures, while others experiment with nontraditional directions— emphasizing teams, networks, and even “boundaryless” organizations. Today’s health care organizations must effectively and creatively respond to trends in the modern workplace changes, including shorter chains of command, increased del- egation, and decentralization. Subsystems, work process evaluation, and teams are useful adaptations to include when designing an organization.
3.1 Understanding Common Organizational Structures
Formally defined, organizing is the process of arranging people and other resources to work together to accomplish a goal. Organizing involves both divid- ing up the tasks to be performed and coordinating results to achieve a common purpose.
Figure 3-1 shows the central role organizing plays in the management process. As the figure shows, managers are responsible for carrying out plans. Planning activities often precede organizing tasks, but the sequence varies based on the needs and culture of each health care organization. (Chapter 6 covers the planning process in detail.) Many beginning health care managers must first follow long-standing plans and procedures that upper managers or former managers created before creating new plans of their own. Whatever the specifics of your situation, organizing and planning tasks often happen in close conjunction; be flexible and adjust your management duties to suit the situation.
Organizing– to create structures
Planning– to set the direction
Controlling– to ensure results
Leading– to inspire effort
• Divide up the work • Arrange resources • Coordinate activities
Figure 3-1
Organizing, as it relates with other management functions.
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54 ORGANIZING THE WORKPLACE
At the most basic level, organizing includes
▲ implementing a clear mission, core values, objectives, and strategy; ▲ identifying who is to do what, who is in charge of whom, and how dif-
ferent people and parts of the organization relate to one another.
The challenge of organizing effectively is to choose the best form or structure to fit the demands of a given situation.1
The organization structure is the system of tasks, workflow, reporting rela- tionships, and communication channels that link the diverse parts of an organi- zation. The specific structures vary greatly between health care organizations, but generally, any structure must both allocate or assign tasks and provide for the coordination of performance results.
Unfortunately, talking about good structures is easier than actually creating them. This is why you often read and hear about restructuring, the process of changing an organization’s structure in an attempt to improve performance.
Organization structures can be described and classified in several ways based on formality, function, divisions, and more.
3.1.1 Formal and Informal Structures
You may know the concept of structure best in the form of an organization chart. A typical organization chart identifies, by diagram, key positions and job titles within an organization. It shows the lines of authority and communication between them.2
An organizational chart shows the formal structure, the intended or official structure. The diagram depicts the way the organization is intended to function. Organizational charts can tell much about an organization, including
▲ the division of work: Positions and titles show how work responsibili- ties are assigned;
▲ supervisory relationships: Lines among positions show who reports to whom;
▲ communication channels: Lines among positions show formal commu- nication channels;
▲ major subunits: Positions reporting to a common manager are identified as a group;
▲ levels of management: Layers of management from top to bottom are shown.
Figure 3-2 shows the formal organizational chart for a midsize teaching hospital. However, behind every formal structure typically lies an informal structure.
This is a “shadow” organization made up of the unofficial, but often critical,
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56 ORGANIZING THE WORKPLACE
working relationships among organizational members. If you drew an organiza- tion’s informal structure, it would show who talks to and interacts regularly with whom, regardless of their formal titles and relationships. Informal structures include people meeting for coffee, exercise groups, friendship cliques, and many other possibilities. The lines of informal structures often cut across levels and move from side to side, rather than solely up and down.
Because of the complex nature of organizations and constantly shifting per- formance demands, informal structures can be very helpful in accomplishing large and small tasks. Through the emergent and spontaneous relationships of informal structures, people gain access to interpersonal networks of emotional support and friendship that satisfy important social needs. They also benefit from contacts with others who can help them better perform their jobs and tasks. Valuable learning and knowledge sharing takes place as people interact infor- mally throughout the workday and in a variety of unstructured situations.
Savvy organizations identify and capitalize on their informal structures. For example, a study by the Center for Workforce Development found that the cafe- teria can be a “hotbed for informal learning,” as workers at a variety of levels tend to share ideas, problems, and solutions with one another over snacks and meals. Dynamic health care managers can mobilize these types of informal learn- ing opportunities as resources for organizational improvement.3
Of course, informal structures also have potential disadvantages. They can be susceptible to rumor, carry inaccurate information, breed resistance to change, and even divert work efforts from important objectives. People who feel left out of informal groupings may become dissatisfied.4
3.1.2 Functional Structures
In functional structures, people with similar skills and performing similar tasks are grouped together.
Figure 3-3 shows functional organizations on a large and small scale. In the first example, a health care organization is organized by the functions of mar- keting/public relations, finance, patient services, and human resources. In this functional structure, patient problems are the responsibility of the patient vice president, marketing problems are the province of the marketing and PR vice president, and so on. In the second chart, a midsize medical clinic is run by a clinic supervisor and four function-specific managers of nursing, office adminis- tration, accounting, and laboratory services. Members of each function work within their areas of expertise. In both diagrams, if each function does its job well, the expectation is that the businesses will operate successfully.
The major advantages of a functional structure include
▲ efficient use of resources within and between functional areas; ▲ consistent and appropriate task assignments based on expertise and train-
ing within each functional area; ▲ high-quality technical problem-solving;
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3.1.2 FUNCTIONAL STRUCTURES 57
▲ in-depth training and skill development within functions; ▲ clear career paths within functions.
However, focusing strongly on functions, functional expertise, and functional careers can sometimes create problems within organizations:
▲ Functional chimneys: When members of a specific functional group develop self-centered and narrow viewpoints, become uncooperative with other groups, and lose the ability to focus on the larger picture, a func- tional chimney develops. Each function ends up communicating, coordi- nating, and problem-solving up and down its chain of command (like a chimney) without extending sideways to other function groups.
▲ Reliance on upper management: When problems occur between func- tion groups, they are too often referred up to higher levels for resolution rather than being addressed directly at the level of action. Running prob- lems up the managerial flagpole slows decision making and problem- solving—and over time can result in a loss of competitive advantage.
▲ Confusion and responsibility-shifting: Focusing too heavily on function groups can create responsibility confusion for issues that actually every group (and indeed, person) in the organization should be accountable for. For example, cost containment, timeliness, patient care, and ongoing responses to legal and business changes are duties that everyone in an organization—both the newly hired payroll clerk and the experienced director of pediatric medicine—need to consider, discuss within their functional groups, and share ideas between functional groups.
President
Vice President Manufacturing
Vice President Human Resources
Vice President Marketing
Vice President Finance
Business Firm
Branch Manager
Manager Operations
Manager Trusts
Manager Loans
Manager Investments
Branch Bank
Figure 3-3
Functional structures for a health care organization and a medical clinic.
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58 ORGANIZING THE WORKPLACE
3.1.3 Divisional Structures
Another traditional way to discuss organizations is to focus on divisional struc- ture. Divisional structures group together people who
▲ provide the same services; ▲ work within the same processes; ▲ serve similar patients; ▲ are located in the same area or geographical region.
As illustrated in Figure 3-4, divisional structures are common in complex organi- zations that have multiple and differentiated products and services, pursue diversi- fied strategies, and/or operate in several competitive environments.5
The potential advantages of divisional structures include the following:
▲ More flexibility in responding to environmental changes. ▲ Improved coordination across functional departments.
General Manager
Grocery products Drugs and toiletries
President
Asian division European division
Agency Administrator
Problem youth Senior citizens
Catalog Sales Manager
Product purchasing Order fulfillment
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Product
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Customer
Process
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Location of activity
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Focus
Divisional structures based on service, geography, patient, and process.
Figure 3-4
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3.1.4 MATRIX STRUCTURES 59
▲ Clearer points of responsibility for delivery of services or products. ▲ Expertise focused on specific patients or customers, products, and
regions. ▲ Greater ease in changing size by adding or deleting divisions.
Of course, divisional structures also have potential disadvantages as well:
▲ Redundancy: Divisional structures can reduce efficiencies and increase costs by duplicating resources and efforts across divisions. A divisional structure based on geographic region, for example, may require a full- time lab technician at all 20 clinic locations spread throughout a state, rather than having a central lab facility with 12 full-time technicians.
▲ Internal competition: Unhealthy rivalries can emerge as divisions com- pete for resources and attention or focus heavily on the performance of their division compared to similar divisions within the organization. Rewarding individual divisions for outstanding performance can encour- age increased productivity and improve workplace attitudes, but it can also lead divisions to forget the larger goals and mission of the entire health care organization.
▲ Tunnel vision: Divisional structures can encourage a division to focus on its needs and goals rather than the best interests of the organization as a whole. (Of course, this “tunnel vision” can happen with functional struc- tures, too.)
3.1.4 Matrix Structures
A matrix structure combines elements of both the functional and divisional structures. The goal is to combine the advantages of each, while minimizing dis- advantages. As shown in Figure 3-5, a matrix structure uses permanent cross- functional teams to integrate functional expertise with a divisional focus. Work- ers in a matrix structure belong to at least two formal groups at the same time—a functional group and a product, program, or project team. They also report to two bosses—one within the function and the other within the team. The cross- functional team members work closely together to share functional expertise and information to solve problems in a timely manner.
The potential advantages of matrix structures include
▲ more interfunctional cooperation in operations; ▲ increased flexibility in meeting changing demands; ▲ better customer service championed by individual project managers; ▲ better performance accountability through the project managers;
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60 ORGANIZING THE WORKPLACE
▲ improved problem-solving at the team level, where the best information is available;
▲ improved strategic management, as top managers can focus on broader strategic issues (PR, patient care, and communications in Figure 3-5) rather than day-to-day specific tasks.
Predictably, the matrix structure also has potential disadvantages:
▲ Power struggles: The two-boss system is susceptible to confusion and conflict, especially when functional supervisors and team leaders vie with one another as to who has the ultimate authority for the project.
▲ Priority confusion: Members of the matrix may have difficulty determin- ing which tasks to do first or where to focus their energies, especially when team members receive orders from more than one boss or manager.
▲ Tunnel vision: Like other structures this section discusses, matrix teams may develop “groupitis” or strong loyalties that focus attention more on the team than on larger organizational goals.
▲ Expense: The use of formal team leaders in a matrix structure can result in increased personnel costs.
Figure 3-5
Matrix structure for a small public health organization.
Engineering Manager
Sales Manager
Manager of Projects
Manufacturing Manager
General Manager
A Project
Manager
B Project
Manager
C Project
Manager
Functional personnel assigned to both projects and their respective functional departments
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3.2 EXPLORING RECENT DEVELOPMENTS IN ORGANIZATION STRUCTURES 61
• Identify and define organizing, organizing structure, and restructuring.
• Explain the role of organizing within the four functions of management.
• Compare formal structure and informal structure within an organization.
• Discuss advantages and disadvantages of organizing by functional structure, divisional structure, and matrix structure.
S E L F - C H E C K
3.2 Exploring Recent Developments in Organization Structures
The global economy and the demands of hypercompetition have health care managers everywhere searching for organizational structures that better meet today’s ever-changing environmental challenges.
Throughout the health care industry, traditional vertical structures are being dismantled in favor of more horizontal ones. In general, horizontal structures emphasize integration and cross-functional teamwork, often while gaining the advantages of networking through information technology.
The following sections discuss several of the most significant changes in orga- nization structures in recent years.
FOR EXAMPLE
The Center for Collaborative Organizations Begun as a student-run organization within the psychology department at the University of North Texas in 1990, the Center for Collaborative Organizations (www.workteams.unt.edu) is now a dynamic institution with eight full-time staff members and a nationally noted reputation for examining the ways in which companies are organized. With a mission of helping all organizations “design and implement work systems to maximize collaboration for organiza- tional effectiveness,” the Center hosts conferences and public workshops, as well as publishes original research, papers, and a free bimonthly newsletter on organizational structures in today’s workplace. More than 20 free papers on organizational trends are available at www.workteams.unt.edu/literature/ free.html; sign up for a free bimonthly newsletter and read previously pub- lished newsletters at www.workteams.unt.edu/newsletter.html.
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62 ORGANIZING THE WORKPLACE
3.2.1 The Team Approach
Teams are the building blocks of today’s new and more-horizontal organizational forms. Team structures formally designate and use permanent and temporary teams extensively to accomplish tasks.6
As Figure 3-6 illustrates, a nursing care facility organized into teams can solve problems and explore opportunities in a more flexible manner. Cross-functional teams composed of members from different functional areas can work together on a part-time or full-time basis, depending on the needs of the organization.
The intention of a team-based approach is to break down functional chimneys (see section 3.1.2), increase information sharing, and create more effective lateral rela- tions that improve problem-solving and performance. At a community health clinic, for example, staff may be assigned to one or more projects (community outreach, infant immunization, and disease education and prevention, to name just a few pos- sibilities). With each project under the direction of a team leader, traditional hierar- chy takes a backseat to the focus on team activities and project accomplishments.
The potential advantages of team structures are numerous and include
▲ better communication across functions; ▲ shared responsibility by all team members for meeting performance targets; ▲ fewer barriers between departments; ▲ improved morale, as people from different parts of an organization get to
better know one another; ▲ improved speed and quality because the teams focus shared knowledge
and expertise on specific problems.
Of course, teams and teamwork create many challenges as well. These include conflicting loyalties among members to both team and functional assignments,
Plant Manager
Engineering Manager
Human Resource Manager
Manufacturing Manager
New product
development team
Sales Manager
Valuing diversity task force
Team assignments
Figure 3-6
Team structure utilizing cross-functional teams for improved lateral relations.
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3.2.2 INFORMATION AND TECHNOLOGY NETWORKS 63
issues of time management, and difficulties with interpersonal relations and group process. Sections 4.1 and 4.2 discuss ways to effectively manage and par- ticipate on teams.
3.2.2 Information and Technology Networks
Increasingly, today’s health care organizations utilize advanced information tech- nology to better link groups within the organization and with groups outside the organization.
A good example of this type of structure is the ongoing trend of groups of different medical services joining into a health care network. Thus, the offices of several pediatricians, an ears/nose/throat specialist, and an allergist might com- bine into a comprehensive children’s health care network, sharing the services of one business office and laboratory. The group may even decide to work with outside contractors for some essential services (a child psychologist, for instance).
Network organizations such as this must use the latest computer and infor- mation technologies to support a shifting mix of strategic alliances and business contracts. With a technological edge, organizations can operate with fewer full- time employees and less complex internal systems. They can more easily develop and maintain partnerships, often across great distances. Networks can also help organizations stay cost competitive through reduced overhead and increased operating efficiency.
The potential disadvantages of network structures trace largely to the demands of coordinating the complex system of business relationships. If one part of the network breaks down or fails to deliver, the entire system suffers the consequences.
As information technology continues to develop, network structures are grow- ing in number and complexity.7 Networks can be useful for smaller organizations,
FOR EXAMPLE
Attaching Goals and Timelines to Organizational Structures The Veterans Administration (VA) medical system in Hawaii (www.va.gov/ hawaii) consists of four separate facilities on four islands. To effectively com- municate its unique organizational structures as well as its ongoing goals, VA of Hawaii reviews its organizational chart annually and attaches goals and timelines to each relationship in its organizational chart. VA of Hawaii then publishes the organizational chart along with organizational perfor- mance and goals with its employees, physicians, and volunteers in its annual report. VA of Hawaii finds this method beneficial in getting goal commit- ment and understanding of reporting structures from all members in its four facilities.
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64 ORGANIZING THE WORKPLACE
including entrepreneurial ones. They are also appropriate components in larger organizations, enabling an organization to outsource specialized business func- tions or services rather than maintain full-time staff to do them.
3.2.3 Boundaryless Organizations
Although increasingly more common in the business world, the boundaryless organization combines the team and network structures described previously, with the addition of temporariness. Entrepreneurial, start-up, and dot-com busi- nesses are often boundaryless organizations. The ability of these businesses to respond quickly to changes in their environments and create new solutions to complex problems makes boundaryless organizations an important organizational structure for health care managers to be aware of in the coming years.
▲ Within boundaryless organizations, context, teamwork, and communi- cation replace formal lines of authority. Team members must react spon- taneously to intense situation demands. Barriers that traditionally and structurally separate organizational members from one another are removed.
▲ Outside boundaryless organizations, organizational needs are met by a shifting mix of outsourcing contracts and operating alliances that form and disband with changing circumstances. The organization’s configuration of external relationships today will look different from one taken tomor- row, as the form naturally adjusts to new pressures and circumstances.
Although few health organizations today are considered boundaryless organi- zations, many characteristics of boundaryless organizations are becoming part of the everyday structure of the modern health care workplace, specifically includ- ing the absence of hierarchy, empowerment of team members, technology uti- lization, and acceptance of impermanence. Work is accomplished by empowered people who come together voluntarily and temporally to apply their expertise to a task, gather additional expertise from whatever sources may be required to per- form it successfully, and stay together only as long as the task is a work in process. The focus in the boundaryless form is on talent for task. The assumption is that empowered people working together without bureaucratic restrictions can accom- plish great things. Such a work setting is supposed to encourage creativity, qual- ity, timeliness, and flexibility, while reducing inefficiencies and increasing speed.
Knowledge sharing is an essential component of the boundaryless organiza- tion. People with talent work together as needed to get a job done. Meetings and spontaneous sharing can happen continuously, perhaps involving thousands of people working together in hundreds of teams that form and disband as needed. Again, the evolving opportunities of information technology help make this type of collaboration possible.
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3.3.1 SHORTER CHAINS OF COMMAND 65
3.3 Responding to Recent Organizational Trends and Changes
As section 1.4 discusses, the concept of the upside-down pyramid is a power- ful example of the new mindset evolving in health care management today. By putting patients on top, served by workers in the middle, who are in turn sup- ported by managers at the bottom, the upside-down pyramid tries to refocus attention on the marketplace and patient needs.
Although the upside-down pyramid is more of a concept than a depiction of a formal organization structure, such thinking is representative of forces behind new trends in organizing the modern workplace. Among these trends is a common theme: managers (and indeed all workers) must make the necessary adjustments to streamline for cost efficiency and to allow increased worker involvement in all aspects of operations.
The following sections cover the most significant changes resulting from recent shifts in perspective.
3.3.1 Shorter Chains of Command
A typical organization chart shows a chain of command, or line of authority that vertically links all positions with successively higher levels of management. When organizations grow in size, they tend to get taller (or grow “vertically”) as more levels of management are added to the chain of command. More layers of management increase overhead costs, add distance in communication, limit access between top and bottom levels, and can slow decision making. These are all reasons why “tall” organizations with many levels of management are often criticized for inefficiencies and poor productivity.
In the business world generally and the health care industry specifically, the current trend is to streamline organizations by cutting unnecessary levels of man- agement. Flatter structures are viewed as a potential source of competitive advan- tage because they can respond more quickly and efficiently to situations.
• Identify and define team, cross-functional team, health care network, and boundaryless organization.
• List characteristics and advantages of work-based teams.
• Compare teams, networks, and boundaryless organizations as tools for organizing a workplace.
• Describe challenges and solutions for health care networks and boundaryless organizations.
S E L F - C H E C K
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66 ORGANIZING THE WORKPLACE
For the manager, shorter chains of command often mean broader responsi- bilities, greater empowerment, and people or processes to manage.
3.3.2 Wider Spans of Control
The span of control is the number of persons reporting directly to a manager. When span of control is narrow, only a few people are directly supervised; a wide span of control indicates that a manager supervises many people. Figure 3-7 shows the relationship between span of control and the number of management levels. Organizations with wider spans of control tend to be flat and have few levels of management. Those with narrow spans of control tend to be tall and have many levels of management.
Tall organizations are more costly and may be less efficient, less flexible, and less customer (or patient) sensitive than flatter ones. The current trend is toward wider spans of control that shorten chains of command and increase worker empowerment.
For the manager, wider spans of control often mean managing a more diverse staff, including many individuals with extensive technical skills outside the man- ager’s training and experience.
3.3.3 Less Unity of Command
Traditional management theory emphasizes the unity-of-command principle— each person in an organization should report to one and only one supervisor.
Figure 3-7
How span of control creates “flat” versus “tall” structures.
Wide span of control creates a flat structure
Manager
Narrow span of control creates a tall structure
General Manager
Team A Leader Team B Leader
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3.3.5 DECENTRALIZATION WITH CENTRALIZATION 67
This one person/one boss notion is intended to avoid the confusion created when a person gets work directions from more than one source.
The “two-boss” system of matrix structure violates unity of command. It does so on purpose and in an attempt to improve lateral relations and project team- work. Unity of command is also less predominant in structures that use cross- functional teams or task forces. The current trend is for less, not more, unity of command in organizations.
For the manager, less unity of command often means additional effort coor- dinating, brainstorming, and even negotiating responsibilities and assignments for staff with other managers in the organization.
3.3.4 More Delegation and Empowerment
Managers and team leaders must decide what work they should do themselves and what should be left for others. At issue here is delegation—the process of distributing and entrusting work to other people.
Unfortunately, a common management mistake is failure to delegate. By not delegating, managers easily become overloaded with work that could and should be done by others. And failure to delegate denies others the opportunity to fully utilize their talents on the job. When done well, by contrast, delegation leads to empowerment. It gives people the freedom to contribute ideas and do their jobs in the best possible ways.
For today’s health care manager, effectively delegating responsibilities and empowering team members to make strong, good decisions is critical for suc- cess of the work team and the entire organization. Sections 3.5 and 9.4.3 deal with the process of delegating.
3.3.5 Decentralization with Centralization
A question frequently asked by managers is, “Should most decisions be made at the top levels of an organization, or should they be dispersed by extensive del- egation throughout all levels of management?”
Top-down decision making is sometimes referred to as centralization; dis- persed decision making is called decentralization. Centralization/decentraliza- tion doesn’t have to be an either/or choice. Today’s health care organizations can operate with greater decentralization without losing centralized control. By using computer networks and advanced information systems, organizations allow higher-level managers to more easily stay informed about a wide range of day- to-day performance matters. Because the top has information on results readily available, it can allow more decentralization.8 If something goes wrong, pre- sumably the information system helps sound an alarm in time for corrective action to be taken quickly.
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68 ORGANIZING THE WORKPLACE
FOR EXAMPLE
Regional Reorganization for Catholic Healthcare West In an effort to reduce management layers and increase local decision mak- ing at its 47 locations, Catholic Healthcare West (www.chwhealth.org) decided to undergo dramatic reorganization. The new structure streamlined reporting relationships, eliminated duplicate services in the main hospital and regional offices, and placed the hospital’s CEO closer to day-to-day oper- ations. Prior to 2001, the hospital’s organizational structure consisted of 10 distinct regions in California, Nevada, and Arizona, each managed by a pres- ident/chief executive officer. After the restructuring, these 10 regions were replaced by four divisions, each managed by a division president. Although the number of hospitals remained constant, the restructuring eliminated approximately 350 corporate and administrative jobs, saving the organiza- tion more than $100 million annually. In the years following the reorgani- zation, each division of Catholic Healthcare West has been able to respond more quickly to divisional needs, developing specialized programs and tar- geting specific communities.
The current trend is toward more decentralization in organizations, while utilizing advances in information systems to retain centralized control. For the manager, this trend means greater reliance on technology to keep track of and quickly report productivity.
3.3.6 Reduced Use of Staff
Health care organizations often have large, diverse staffs to help provide expert advice, skills, guidance, and services. Unfortunately, a staff can grow to the point that it costs more in administrative overhead than it is worth. For this reason, staff cutbacks are a common first choice in downsizing and other cost-saving efforts.
What is best for any organization is a cost-effective, sensibly sized staff that satisfies, but doesn’t overreact to, needs for specialized technical services and skills.
The current trend is for organizations to minimize the use of staff compo- nents in the quest for increased operating efficiency. Specialized services or skills are often hired on a contract basis, rather than paid for as a full-time staff posi- tion. For the manager, reduced use of staff means thinking creatively about how to meet specific technical demands in the workplace, without hiring too many full-time workers.
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3.4.1 BUREAUCRATIC VERSUS ADAPTIVE DESIGNS 69
3.4 Designing Effective Organizations
Organizational design is the process of aligning organizational structures and cultures to best serve the organization’s mission, strategy, and objectives.9 Key directions today involve a basic shift in attention away from traditional, vertical, authority-driven organizations and toward those that are more horizontal and task-driven.
3.4.1 Bureaucratic versus Adaptive Designs
A bureaucracy is a form of organization based on logic, order, and the legitimate use of formal authority. Originally described by theorist Max Weber as “ideal” organizational forms, bureaucracies are supposed to be fair and highly efficient.10
They operate with a clear-cut division of labor, a strict hierarchy of authority, formal rules and procedures, and career advancement based on competency. Today, most organizations recognize that there are limits to bureaucracy.11 Orga- nizations that rely too much on rules and procedures can become unwieldy, rigid, and slow in responding to changing environments.
However, a bureaucratic form can sometimes be appropriate for an organi- zation. In a classic research study conducted in England during the early 1960s, Tom Burns and George Stalker concluded that different organizational forms could be successful, depending on the nature of an organization’s external envi- ronment.12 Specifically, more bureaucratic or “mechanistic” forms of organization work best in stable environments, while less bureaucratic and more “organic” forms perform best in changing and uncertain environments.
The left-hand portion of Figure 3-8 lists additional characteristics of bureaucratic organizations, including centralized authority, many rules and procedures, a precise division of labor, narrow spans of control, and formal means of coordination.
• Identify and define upside-down pyramid organization, chain of command, span of control, unity of command principle, delega- tion, centralization, and decentralization.
• Discuss how formal organizational structures are changing in terms of chains of command and spans of control.
• Describe trends in unity of control and delegation in today’s work- place.
• Compare decentralization and centralization as decision-making strategies.
S E L F - C H E C K
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70 ORGANIZING THE WORKPLACE
In today’s modern workplace—including the rapidly changing health care industry—the ability to respond quickly to shifting challenges in rapidly chang- ing environments often distinguishes successful organizations from less success- ful ones.13 High performance in these circumstances is achieved by adaptive organizations with a minimum of bureaucratic features and with cultures that encourage worker empowerment and participation.
The right-hand portion of Figure 3-8 contrasts the characters of adaptive organizations with bureaucratic organizations. In general, adaptive organizations operate with more decentralized authority, fewer rules and procedures, less pre- cise division of labor, wider spans of control, and more personal means of coor- dination. Adaptive organizations are flatter systems in which a lot of work gets done through informal structures and networks of interpersonal contacts.
The horizontal design features value teamwork and legitimate cross- functional linkages. They try to give otherwise capable employees the freedom to do what they can do best—get the job done. Above all, adaptive organiza- tions are built upon eliminating restrictive centralized controls and trusting that people will do the right things on their own initiative.
Figure 3-8
A continuum of organizational alternatives, from bureaucratic to adaptive organizations.
Bureaucratic Organizations
mechanistic designs
Centralized Authority
Adaptive Organizations organic designs
Decentralized
Many Rules and procedures Few
Narrow Spans of control Wide
Specialized Tasks Shared
Few Teams and task forces Many
Formal and impersonal
Informal and personal
Coordination
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3.4.2 MAKING DESIGN DECISIONS 71
3.4.2 Making Design Decisions
Good organizational design decisions satisfy situational demands and allow all resources to be used to best advantage.
The notion that “structure follows strategy” is an important premise of orga- nizational design.14
▲ When your strategy is stability oriented, the premise is that little signifi- cant change will be occurring in the external environment. The supporting organization’s structure should be well defined and predictable, as found in bureaucratic organizations using more mechanistic design alternatives.
▲ When your strategy is growth oriented, operating objectives are likely to include the need for innovation and flexible responses to changing competition in the environment. The most supportive structure is likely to be one that is more decentralized and empowered, as found in adap- tive organizations using more organic design alternatives.
Size is another factor that plays a role in organizational design. Although research indicates that larger organizations tend to have more mechanistic struc- tures than smaller ones, it is clear that this is not always best for them. In fact, a perplexing managerial concern is that organizations tend to become more bureaucratic as they grow in size and consequently have difficulty adapting to changing environments.
Good managers constantly search for unique ways to overcome the disadvan- tages of large size. They are creative in forming teams and smaller units, and allow- ing them to operate with considerable autonomy within the larger organizational framework. Such simultaneous structures combine mechanistic and organic designs to meet the need for both production efficiency and continued innovation.
Managers who want to design organizations and work processes that make good sense for their teams or departments, as well as the broader organization, can run through the following five critical questions, or checks, whenever they change, add to, or eliminate something from the design of an organization:
Check 1: Does the design fit well with the major problems and opportunities of the external environment?
Check 2: Does the design support the implementation of strategies and the accomplishment of key operating objectives?
Check 3: Does the design support core technologies and allow them to be used to best advantage?
Check 4: Can the design handle changes in organizational size and different stages in the organizational life cycle?
Check 5: Does the design support and empower workers and allow their tal- ents to be used to best advantage?
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72 ORGANIZING THE WORKPLACE
3.4.3 Incorporating Subsystems
Small departments, work units, or teams headed by managers are subsystems that perform specialized tasks within organizations. Ideally, the work of each subsys- tem is efficient and well integrated to meet the needs of the larger organization.
Research in subsystems design by Paul Lawrence and Jay Lorsch of Harvard University15 found that not only did successful firms match their overall orga- nizational designs to their respective environmental challenges, but they also matched their subsystem designs to the challenges of their respective subenvi- ronments. So, as an example, a successful inner-city hospital might include divi- sions targeting the needs of its community (emergency care, chemical depen- dency, pediatric medicine, and so on) as well as having special programs within a division further targeting the needs of the community (subsidized early child- hood vaccines within pediatric medicine, for instance).
Additionally, Lawrence and Lorsch’s research found that subsystems within successful organizations
▲ included different structures to better accommodate the special prob- lems and opportunities of their unique operating situations. This illus- trates differentiation, or the degree of difference that exists between the internal components of the organization;
▲ worked well with one another, even though they had very different structures. This illustrates integration, the level of coordination achieved among an organization’s internal components.
Figure 3-9 shows how research, patient-care, and community relations divi- sions in a single hospital can operate differently in response to unique needs, yet still provide outstanding medical services to all its constitutes.
FOR EXAMPLE
Facilitating Change at the Food and Drug Administration The Office of Regulatory Affairs in the U.S. Food and Drug Administration (www.fda.gov/ora) established a special organizational development (OD) team to assist field offices throughout the United States in creating and implement- ing organizational changes. The OD team includes managerial and staff-level employees (two full-time OD specialists plus 10 to 12 others who spend a por- tion of their weekly time on organizational development tasks). The OD team is trained together on organizational topics and meets by video conference to share information. The Office of Regulatory Affairs regional and divisional man- agers can request the OD team’s help to plan changes, assess departmental readiness for change, clarify vision, and implement change strategies.
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3.4.3 INCORPORATING SUBSYSTEMS 73
As Figure 3-9 shows, four common sources of differentiation exist among these and other subsystems:
▲ Differences in time orientation become characteristic of work units themselves. This occurs as the planning and action horizons of man- agers vary from short term to long term. In the hospital described in Figure 3-9, for example, the patient-care subsystem may have a shorter-term outlook than does the research group. These differences can make it difficult for personnel from the two units to work well together.
▲ Different tasks assigned to work units may result in differences in objectives. For example, a cost- and efficiency-conscious shift manager and a volume-conscious public relations manager may have difficulty agreeing on solutions to common problems.
▲ Differences in interpersonal orientation can affect subsystem rela- tions. To the extent that patterns of communication, decision making, and social interaction vary, it may be harder for personnel from different subsystems to work together.
▲ Differences in formal structure can also affect subsystem behaviors. Someone who is used to flexible problem-solving in an organic setting may find it very frustrating to work with representatives from a mecha- nistic setting that operates with very strict rules.
Figure 3-9
Differentiation among research, patient-care, and community relations divisions.
President
Sales division
Marketing subenvironment
R & D division
Scientific subenvironment
Manufacturing division
Manufacturing subenvironment
deals with
deals with
deals with
and emphasizes
and emphasizes
and emphasizes
• Product quality • Long time horizons • Organic structures
• Cost efficiency • Short time horizons • Mechanistic structures
• Customer satisfaction • Short time horizons • Mechanistic structures
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74 ORGANIZING THE WORKPLACE
As described by the Lawrence and Lorsch study, successful organizations operate with both differentiated structures and appropriate integrating mecha- nisms. A basic paradox, however, makes this a particularly challenging task in organizational design: Increased differentiation among organizational subsystems creates the need for greater integration, but integration becomes harder to achieve as differentiation increases.
Bottom line: Subsystems need to be different, but integrating subsystems is a challenge. Keep the following tips in mind when attempting to improve sub- system integration:16
▲ Clearly specify required activities (such as rules and procedures everyone must follow).
▲ Refer problems between divisions upward, to a common boss if possible. ▲ Plan and set clear targets and goals so everyone is heading in the same
direction. ▲ Assign formal coordinators to act as liaisons and link subunits. ▲ Form temporary task forces to coordinate activities and solve specific
problems. ▲ Form permanent teams with the authority to coordinate and solve prob-
lems as they occur over time. ▲ Create a matrix structure to improve coordination among multiple and
diverse projects.
3.4.4 Evaluating Work Processes
Researcher Michael Hammer defines a work process as “a related group of tasks that together create a result of value for the customer.”17 Four aspects of Hammer’s definition are particularly worth noting:
▲ Group of tasks: Tasks are viewed as part of a group rather than in isolation. ▲ Together: Everyone must share a common goal. ▲ Result: The focus is on what is accomplished, not merely on activities. ▲ Customer: Processes serve customers (or patients in the case of health care
organizations), and the patients’ perspectives are the ones that really count.
Today’s health care managers are frequently asked to reorganize the way their departments, teams, and staffs work and interact. Process reengineer- ing is the systematic and complete analysis of work processes and the design of new and better ones.18 The goal of process reengineering is to focus atten- tion on the future, on patients, and on improving ways of doing things. It tries
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3.4.4 EVALUATING WORK PROCESSES 75
to break people and mind-sets away from habits, preoccupation with past accomplishments, and tendencies to continue implementing old and outmoded ways of doing things. Simply put, reengineering is a radical and disciplined approach to changing the way work is carried out in organizations.
Through process value analysis, managers identify and carefully evaluate each step in a workflow. In rigorous process value analysis, managers must find each step important, useful, and adding value to the overall purpose of the orga- nization. If not, the step is eliminated. Process value analysis typically involves the following steps.19
1. Identify the core processes. 2. Map the core processes in respect to workflows. 3. Evaluate all tasks for the core processes. 4. Search for ways to eliminate unnecessary tasks or work. 5. Search for ways to eliminate delays, errors, and misunderstandings. 6. Search for efficiencies in how work is shared and transferred among people
and departments.
Patients, teamwork, and efficiency are all central to process reengineering. The goal is to redesign core processes to center control for them with an identifiable group of people and to focus the entire system on best meeting patient needs and expectations.
Process reengineering tries to eliminate duplications of work and systems bot- tlenecks. In so doing, it tries to reduce costs and streamline operations efficiency.
• Identify and define organizational design, bureaucracy, adaptive organizations, subsystems, differentiation, integration, process reengineering, and process value analysis.
• List characteristics of bureaucratic and adaptive organizational designs.
• Describe strategies for the process of organizing a department.
• Discuss five checks to consider prior to any organizational change.
• Explain four reasons for including subsystems in an organization.
• Sequence the six steps of process value analysis.
S E L F - C H E C K
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76 ORGANIZING THE WORKPLACE
3.5 Dividing Work among Teams
Formally defined, a team is a small group of people with complementary skills, who work together to achieve a shared purpose and who hold themselves mutu- ally accountable for its accomplishment.20
Teamwork is the process of people working together to accomplish these goals. The ability to lead through teamwork requires a special understanding of how teams operate and the commitment to use that understanding to help them achieve high levels of task performance and membership satisfaction. One of the biggest bene- fits of teamwork is synergy—the creation of a whole that is greater than the sum of its parts. Synergy occurs when teams use their resources to the fullest and achieve, through collective performance, far more than is otherwise possible.
An important part of a manager’s job is knowing when a team is the best organizing choice for a task. The second is to know how to work with and lead the team to best accomplish that task. The following section discusses the first task, using teams as an organizing tool for dividing work responsibilities. (Man- aging and leading teams is covered in Chapter 4.)
3.5.1 The Benefits of Teams
While synergy is an important advantage, teams are useful in other ways. Being part of a team can have a strong influence on individual attitudes and behaviors. Working in and being part of a team can satisfy important individual needs and can also improve performance. Teams, simply put, can be very good for both orga- nizations and their members. The usefulness of teams includes21
▲ increasing resources for problem-solving; ▲ fostering creativity and innovation; ▲ improving the quality of decision making; ▲ enhancing members’ commitments to tasks; ▲ raising motivation through collective action; ▲ helping control and discipline members; ▲ satisfying individual needs as organizations grow in size.
Of course, organizing based on a team approach is never a guaranteed suc- cess. Who hasn’t been part of a team that includes members who slack off because responsibility is diffused among several people and the rest of team will take care of the work?22 And who hasn’t heard people complain about having to attend what they consider to be another “time-wasting” teaming?23
Fortunately, things don’t have to be this way. In fact, they must not be if teams are to make their best contributions to organizations. The following sections explore some of the most common types of teams in today’s workplace and recommends when each type of team is most appropriate.
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3.5.2 COMMITTEES AND TASK FORCES 77
3.5.2 Committees and Task Forces
Committees and task forces typically bring people together outside of their daily job assignments to work in small teams for a specific purpose. They are typically led by a designated head or chairperson who, in turn, is held account- able for committee or task-force results. While committees and task forces share many similarities, a few notable differences are as follows:
▲ Committees usually operate with a continuing purpose, while its mem- bership may change over time.
▲ Task forces are more temporary, and their official tasks are very specific and time defined. Once its stated purpose has been accomplished, a task force typically disbands.
Committees and task forces are increasingly used to bring together people from various parts of an organization to work on common problems. But to achieve the desired results, these teams must be carefully established and well run, specifically:
▲ Select appropriate members who will be challenged by the assignment, who have the right skills, and who seem able to work well together.
▲ Clearly define the purpose of the task force or committee to ensure that members and important outsiders know what is expected, why, and on what timetable.
▲ Carefully select a leader who has good interpersonal skills, can respect the ideas of others, and is willing to do what needs to be done.
▲ Periodically review progress to ensure that all task-force or committee members feel collectively accountable for results and that they receive performance feedback.
FOR EXAMPLE
Attitude Surveys and Team Effectiveness Over the last 10 years, a variety of attitude surveys have been used to gauge the effectiveness of health care teams. One survey worth noting is the Change Readiness Index (CRI). This scorecard system asks team members to rate their health care organization and specific teams or groups in the cat- egories of patient service, organizational reaction and readiness to change, and overall organizational dynamics such as communication and morale. The VA Medical Center in Phoenix, Arizona, used the CRI to assess the right strategy and approach for not only the commencement of a new leadership team, but also for strategy formulation in every new venture undertaken during their growth over the past decade.
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78 ORGANIZING THE WORKPLACE
3.5.3 Cross-Functional Teams
Organizational design today emphasizes horizontal integration, problem-solving, and information sharing. It also tries to eliminate the tendency of workers to remain within their functions and restrict communication with other parts of an organization. The members of a cross-functional team come together from dif- ferent functional units to work on a specific problem or task, and to do so with the needs of the whole organization in mind.
Cross-functional teams are a particularly appropriate organizing choice when the goal is sharing information, exploring new ideas, and seeking creative solu- tions. Team members need to be encouraged to look beyond purely functional concerns and demands, and collectively and individually to think and act in the best interests of the total system.
3.5.4 Employee Involvement Teams
Many organizations now utilize functional or cross-functional employee involve- ment teams. These are groups of workers who meet on a regular basis outside of their formal assignments, with the goal of applying their expertise and atten- tion to continuous improvement.
Using a problem-solving framework, teams often try to bring the benefits of employee participation to bear on a wide variety of performance issues and con- cerns. A popular form of employee involvement team is the quality circle, a group of workers that meets regularly to discuss and plan specific ways to improve work quality.24 Usually, quality circles consist of six to twelve members from a work area. After receiving special training in problem-solving, team processes, and quality issues, members of the quality circle try to come up with suggestions that the entire organization can implement to raise productivity and improve processes.
3.5.5 Virtual Teams
The Internet, intranets, and computer software have all helped give rise to the phenomenon of virtual teams. Members of these teams work together and solve problems through largely computer-mediated rather than face-to-face interac- tions.25
Potential advantages of virtual teams make them increasingly important. Team members from widely dispersed locations can deal collectively with issues in a time-efficient fashion and without some of the interpersonal difficulties that may otherwise occur—especially when the issues are controversial.
Electronic team meetings can cause problems, however, particularly when members’ working relationships are depersonalized and some of the advantages of face-to-face interaction are lost.26
Virtual teams are most effective for projects that are well outlined (a detailed agenda, distributed prior to the video or phone conference makes
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3.5.6 SELF-MANAGING WORK TEAMS 79
meetings clear, efficient, and focused) or that have an extremely focused nature (the team exists solely for the purpose of drafting the department’s new safety plan, for example).
3.5.6 Self-Managing Work Teams
In a growing number of organizations, the functional team consisting of a first- level supervisor and his or her immediate subordinates is disappearing. It is being replaced with self-managing work teams. These are teams of workers whose jobs have been redesigned to create a high degree of task interdependence and who have been given authority to make many decisions about how they go about doing the required work.27 The expected advantages include better performance, decreased costs, and higher morale.
Self-managing teams operate with participative decision making, shared tasks, and responsibility for many of the managerial tasks performed by supervisors in more traditional settings. “Self-management” responsibilities include planning and scheduling work, training members in various tasks, sharing tasks, meeting per- formance goals, ensuring high quality, and solving day-to-day operating problems. In some settings, the team’s authority may even extend to “hiring” and “firing” its members when necessary.
A key feature of self-managing teams is multitasking, in which team mem- bers each have the skills to perform several different jobs. The implications of self-managing teams are depicted in Figure 3-10. Members of a self-managing team report to higher management through a team leader rather than to a for- mal supervisor, making the traditional role of first-line supervisor unnecessary. This is an important change in organizational structure because each self-man- aging team handles the supervisory duties on its own. Furthermore, within a self-managing team, the emphasis is always on participation.
The leader and members of a self-managed work team are expected to work together—not only to do the required work but also to make the decisions that determine how it gets done. A true self-managing team operates with these characteristics:
▲ Members are held collectively accountable for performance results. ▲ Members have discretion in distributing tasks within the team. ▲ Members have discretion in scheduling work within the team. ▲ Members are able to perform more than one job on the team. ▲ Members train one another to develop multiple job skills. ▲ Members evaluate one another’s performance contributions. ▲ Members are responsible for the total quality of team products.
Self-managed teams are an appropriate organizing choice when extreme flexibility is required by the environment or when you want to develop a new
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80 ORGANIZING THE WORKPLACE
• Identify and define team, teamwork, synergy, committee, task force, employee involvement team, quality circle, virtual team, and self-managing work team.
• Discuss the major benefits of using a team structure to organize a department.
• Compare characteristics of a task force and a committee.
• List strategies for designing and managing effective task forces and committees.
• Explain recent innovations in teaming, including the employee involvement team, quality circle, and virtual team.
• Describe characteristics of a self-managing team.
S E L F - C H E C K
Figure 3-10
Organizational and management implications of self-managing work teams.
Top manager
Middle manager done by
Work unit
Top manager
Middle manager
Self-managing team
Team leader
Supervisor
Supervisor Team
• Planning and scheduling work • Assignment of work tasks • Training of workers • Performance evaluation • Quality control
product, service, or way of working together. Successful self-managed teams are typically comprised of well-trained team members with training in planning, self-directing, project management, communication, and conflict resolution.
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KEY TERMS 81
SUMMARY The ways in which health care workplaces are structured or organized has evolved with changes in economic pressures and patient needs. Organizations rely on both formal and informal structures to arrange workers, assign responsibilities, and establish work processes. In recent years, organizing structures have developed to include teams, networks, and even boundaryless organizations. Whatever the spe- cific organizational structures, today’s health care managers must design organiza- tions with shorter chains of command, wider spans of control, and decentralized power, among other things. Effectively designed organizations incorporate subsys- tems, allow for differences in work processes, and encourage integration. Team- based organizational designs are especially prevalent and effective in today’s workplace; savvy managers utilize teaming in all its various forms—encouraging the ideal of self-managing teams to achieve the highest level of group productivity.
KEY TERMS Adaptive organizations Organizations with a minimum of bureaucratic
features and with cultures that encourage worker empowerment and participation.
Boundaryless organization An increasingly common structure in the busi- ness world, which combines teams and network structures for temporary purposes.
Bureaucracy A form of organization based on logic, order, and the legitimate use of formal authority.
Centralization Traditional, top-down decision.
Chain of command Line of authority that vertically links all positions with successively higher levels of management.
Change Readiness Scorecard system asks team members to rate their Index (CRI) health care organization and specific teams or
groups in the categories such as patient service, organizational reaction and readiness to change.
Committee Organizational group that usually operates with a continuing purpose while its membership may change over time.
Cross-functional teams Within a matrix structure, workers belong to at least two formal groups at the same time—a functional group and a product, program, or project team.
Decentralization Dispersed decision making.
Delegation The process of distributing and entrusting work to other people.
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82 ORGANIZING THE WORKPLACE
Differentiation The degree of difference that exists between the internal components of the organization.
Divisional structures Organizational strategy in which you group to- gether people who provide the same services, work within the same processes, serve similar audiences, or are located in the same area or ge- ographical region.
Employee involvement Group of workers who meet on a regular basis team outside of their formal assignments, with the
goal of applying their expertise and attention to continuous improvement.
Formal structure The intended or official structure of an organi- zation.
Functional chimneys Negative effect of formal structures, in which members of a specific functional group develop self-centered and narrow viewpoints, become uncooperative with other groups, and lose the ability to focus on the larger picture.
Functional structure Organizational strategy in which people with similar skills and performing similar tasks are grouped together.
Health care network Different medical services joining together to provide comprehensive health care, often sharing the services of one business office and laboratory.
Horizontal structures New organizational models, which emphasize integration and cross-functional teamwork, of- ten while gaining the advantages of networking through information technology.
Informal structure The unofficial but often critical working rela- tionships among organizational members, re- gardless of formal titles and relationships.
Integration The level of coordination achieved among an or- ganization’s internal components.
Matrix structure Organizational strategy that combines ele- ments of both the functional and divisional structures.
Organizational design The process of aligning organizational struc- tures and cultures to best serve the organiza- tion’s mission, strategy, and objectives.
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KEY TERMS 83
Organization chart Diagram that identifies key positions, job titles, lines of authority, and communication within an organization.
Organization structure The system of tasks, workflow, reporting rela- tionships, and communication channels that link the diverse parts of an organization.
Organizing The process of arranging people and other re- sources to work together to accomplish a goal.
Process reengineering The systematic and complete analysis of work processes and the design of new and better ones with the goal of focusing attention on the future, on patients, and on improving ways of doing things.
Process value analysis Managers identify and carefully evaluate each step in a workflow. Each step must be impor- tant, useful, and add value to the overall pur- pose of the organization; if not, the step is eliminated.
Quality circle A popular form of employee involvement team in which a group of workers meets regularly to discuss and plan specific ways to improve work quality.
Restructuring The process of changing an organization’s struc- ture in an attempt to improve performance.
Self-managing work team Workers whose jobs have been redesigned to create a high degree of task interdependence and who have been given authority to make many decisions about how they go about doing the required work.
Span of control The number of people reporting directly to a manager within an organizational structure.
Subsystems Small departments, work units, or teams headed by managers who perform specialized tasks within organizations.
Synergy The creation of a whole that is greater than the sum of its parts; one of the benefits of teamwork.
Task force Organizational group that is more temporary with official tasks that are very specific and time defined. Once its stated purpose has been ac- complished, a task force typically disbands.
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84 ORGANIZING THE WORKPLACE
Team Group of workers organized to accomplish tasks; the building blocks of today’s new and more horizontal organizational forms.
Teamwork The process of people working together to ac- complish goals.
Unity-of-command Each person in an organization should report to principle one and only one supervisor.
Upside-down pyramid Organizational mind-set that refocuses attention on the marketplace and patient needs by putting patients on top, served by workers in the middle, who are in turn supported by man- agers at the bottom.
Vertical structures Traditional top-down organizational models.
Virtual teams Teams that work together and solve problems through largely computer-mediated rather than face-to-face interactions.
Work process A related group of tasks that together create a re- sult of value for the customer or patient.
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SUMMARY QUESTIONS 85
ASSESS YOUR UNDERSTANDING Go to www.wiley.com/college/Lombardi to evaluate your knowledge of the basics of workplace organization. Measure your learning by comparing pretest and post-test results.
Summary Questions
1. Of the four major functions of management, organizing often happens in close conjunction with (a) leading. (b) planning. (c) controlling. (d) facilitating.
2. Formal structures within an organization include (a) recommended communication channels. (b) division of labor. (c) levels of management. (d) all the above.
3. Organizations that rely on functional structures can offer employees clear career paths within functions but sometimes become over-reliant on upper management to solve cross-functional disputes. True or false?
4. A potential advantage of a matrix structure is (a) improved problem-solving at the team level. (b) improved problem-solving at the technical level. (c) consistent and appropriate task assignments based on expertise. (d) efficient and effective task assignments based on training.
5. Throughout health care today, traditional horizontal work structures are being dismantled and replaced by more flexible vertical structures. True or false?
6. Organizing by teams offers numerous benefits to an organization. Benefits include all of the following except (a) shared responsibility by all team members for meeting performance
targets. (b) improved morale as people in different areas better get to know one
another. (c) streamlined interpersonal and interdepartmental relationships. (d) fewer barriers between departments.
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7. Boundaryless organizations have qualities of teams and network structures, but they are also temporary in nature. True or false?
8. Managers in “flat” organizations tend to have wider spans of control, broader responsibilities, and shorter chains of command. True or false?
9. Decentralization in today’s health care organizations is made possible by (a) decreased emphasis on cross-functional training. (b) increased reliance on degreed employees. (c) decreased spending on benefits. (d) increased use of information-share technology.
10. Bureaucratic structures have no place in today’s health care workplace. True or false?
11. When you’re considering new organizational structures, you should run your ideas through several of checks, including (a) does the design support and empower workers? (b) does the design support core technologies? (c) does the design fit with the major problems and opportunities of the
external environment? (d) all of these.
12. Subsystems within successful health care organizations allow for both (a) specialization and exclusion. (b) communication and consistency. (c) differentiation and integration. (d) none of these.
13. One of the biggest benefits of organizing by teams is (a) synergy. (b) cost-savings. (c) training. (d) efficiency.
14. A committee usually has specific tasks and exists for a limited time frame, while a task force usually operates with continuing purpose as its membership changes over time. True or false?
15. Which of the following is NOT a characteristic of a self-managing work team? (a) The team shares responsibility for managerial tasks performed by
supervisors in more traditional settings. (b) The team divides up daily tasks and solves day-to-day operation
problems. (c) Team members follow established procedures given to them by upper
management. (d) Team members are multitaskers, performing several different jobs.
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REVIEW QUESTIONS 87
Review Questions
1. The nurses at a large research hospital are members of a nursing team for their departments as well as disease-specific teams focusing innovative treatments for specific conditions (such as cancer, AIDS/HIV, diabetes). What sort of organization structure is this?
2. A district manager and a team leader have children who play on the same basketball team. What sort of organization are these two utilizing when they casually discuss possible solutions to a productivity problem during a game?
3. Why would a department choose to organize based on divisional structures?
4. A student health center organized by matrix structures has difficulty determining which students to see first and where to invest its limited budget. What disadvantage of matrix structure is the center experiencing?
5. Network organizations are fairly expensive to establish, requiring quality computer and information technology to link various locations. What are some benefits of network organizations?
6. In what ways might an organization be described as “boundaryless” within the organization and outside the organization?
7. The notion of one employee/one boss is being replaced in today’s work- place by the two or more boss matrix structure. What does less unity of command mean for managers?
8. Hiring out specialized services on a contract basis is one common managerial response to which major organizational trend?
9. A large public health advocacy group recently eliminated all middle man- agers. Now several dozen project managers report to three top-level man- agers who focus on specific health topics. What workplace trends does this change represent?
10. How does an adaptive organization contrast with a bureaucratic organiza- tion in terms of authority and the use of teams?
11. As the manager of a small medical records team, you decide to assign responsibility for each case to a specific team member, rather than having staff work on whatever case is most pressing. Although you like the potential for increased customer service, you’re concerned that this man- ner of working may not be effective if your hospital becomes part of a large regional health care network. What “check” for creating organizational structures are you considering?
12. In process value analysis, managers must find each step of a process important, useful, and adding value to the overall purpose of the organi- zation. If any of these criteria are not met, what should the manager do?
13. Would a committee or a task force be a more appropriate organizational choice to deal with a significant increase in medical charting errors in the last months?
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88 ORGANIZING THE WORKPLACE
14. Virtual teams are becoming a common organizing structure in today’s workplace. What two types of projects are virtual teams a particularly appropriate choice?
15. Self-managing teams are becoming an ideal in today’s workplace. Why is multitasking so important to effective self-managing teams?
Applying This Chapter
1. At a community-based HIV/AIDS clinic, patients are assigned to treatment teams that focus on serving specific “clusters” patients (drug users, teens, or gay/lesbian, for example). What might be some of the advantages to this team-based approach for delivering health care services?
2. Emergency and disaster preparedness are topics of increasing importance to all health care organizations. A midsize hospital along Florida’s Atlantic coast wants to establish a comprehensive plan for responding to natural disasters and other major emergencies within its organization, as well as within surrounding communities, the state of Florida, and the Atlantic coast. What sorts of team structures should the hospital put in place to achieve this goal?
3. Currently, every purchasing decision for your team must be presented to the director of purchasing in a written report and approved. The process is time-consuming and disempowering. What organizational restructuring can you as manager suggest to help save time and empower group man- agers to make some purchasing decisions on behalf of their teams?
4. The manager of the weekday staff at a hospice-care facility wants to redesign staff responsibilities in order to save the organization money in the next fiscal year. Specifically, the manager plans to staff each shift with one nurse practitioner rather than two RNs. (The manager also hopes that scheduling a nurse practitioner will lessen demand on doctors, thus saving the organization even more money.) To maintain head count, an additional certified nursing aide will be hired for each shift. Experienced aides and LPNs will take on additional responsibilities, as directed by the nurse practitioner. How does this plan hold up when run through the five checks described in section 3.4.2?
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YOU TRY IT
Following the Flow of an Organizational Chart Take a look at the formal organizational chart for the hospital or health care organization you work for (or are interested in working for someday). You can also review the organizational chart for your school or check out the formal organizational chart for the Arkansas Re- gional Organ Recovery Agency (www.arora.org/about/ orgchart.html). How do you describe the formal struc- tures in place? Specifically, who reports to whom? What are the informal structures? How do decisions re- ally get made? How long is the chain of command? How wide is the span of control?
Making Connections in Boundaryless Organizations Although few health care workplaces today can be considered true boundaryless organizations (see sec- tion 3.2.3), workplace trends within and outside health care are requiring employees to connect with an ever- widening array of co-workers, consultants, off-site em- ployees, and other resources. Whatever form a bound- aryless organization takes, sharing knowledge is critical to the organization’s success. Consider ways in which you currently share knowledge—with fellow stu- dents and professors, with family and friends, and with co-workers. What techniques have been most effective for sharing information and ideas? What techniques were ineffective? How might these techniques be ap- plied or modified in a health care work environment?
Shorter and Wider Current organizational trends suggest that in an effort to keep costs in check, health care organizations will continue to streamline layers of management (espe- cially middle management) and expand the control of all remaining managers. Carefully consider the organi- zational chart at your current health care or non-health- care employer (or refer to the organizational chart for Penobscot Valley Hospital at www.pvhhealthcare.org/
welcome/orgchart.asp). Consider the implications to you and your department if one of the departments or layers of management above you were eliminated for cost-saving reasons. What additional responsibilities might you or your department need to assume? What responsibilities would need to be assumed by other managers or departments? What additional resources or staffing would your department require to meet the new responsibilities?
Stability and Growth Over its lifetime, an organization will most likely pursue organizational designs that are stability and growth ori- ented. Review the characteristics of a stability orienta- tion and a growth orientation (section 3.4.2) and then consider the evolution of your department or employer over a period of at least 5 years. (If you don’t have an employer or if you don’t know enough about the strate- gic history of your employer, take a look at the history of Fulton State Hospital at www.dmh.missouri.gov/fulton/ history.htm.) What changes and organizational designs reflect a growth orientation? What changes and organzi- ational designs reflect a stability orientation? In your opinion, has the organization had more a growth or sta- bility orientation during its history?
Steps Toward Self-management Consider your next group assignment or project as an opportunity to try working as a self-managing team. Rather than selecting a leader for the project, use par- ticipative decision-making strategies (see section 4.5 for specific tools and ideas) to create a group in which all members are collectively accountable for perfor- mance results. As a group, discuss and decide on who will do which tasks. Consider how the role of multitask- ing will affect your group—for example, how can group members perform more than one job on the team and still complete the assignment on time and effectively? In what way could the group members evaluate one an- other’s performance or contributions?
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