Management of Health Services - Term Paper Example

Management of Health Services Name Grade Course Tutor’s Name Date Outline Abstract Introduction Reasons for continuing reform/restructure of health system Influences that pose the most challenges to healthcare managers Disparate stakeholders Multiple missions Professional autonomy Lack of information Why some health services perform better than others Approaches and practices for adoption in the management of complex and changing circumstances Conclusion Abstract This report identifies challenges encountered in the healthcare system, the need for strengthening healthcare systems, confluence of professionals, new goals, and changing employee expectations as the main reasons why reforms and restructuring continues in the healthcare system. The report further identifies lack of information, professional autonomy, multiple missions and disparate stakeholders as the main influences which pose the most challenges to healthcare managers. The report further uses different theories (resource dependence theory, strategic management theory, population ecology theory, and institutional perspective theory) to explain why some services survive or perform better than others. From the different theories, the strategic management theory is picked and discussed as the most appropriate for adoption in the management of complex and constantly changing environmental factors. The report concludes by noting that for as long as internal and external factors change, so will organisations. As such, most organisations in the healthcare system or elsewhere will have no option but to change with the times. They however need to adopt effective change management practices, which is arguably pegged on good strategies. Introduction The last decade in Australia has been marked by noticeable changes in the healthcare sector. Specifically, the diversion of resources from acute to primary care and the move by a significant number of hospitals to effectively integrate and coordinate care has led to major changes. This report explains why the reforms and restructuring of healthcare systems go on, and also identifies the influences that challenge healthcare managers the most. The report further explains why some health services perform better than others upon being subjected to changes. Lastly, the report identifies the practice and approaches that are appropriate for adoption in the management of complex and changing circumstances. Reasons for continuing reform/restructure of the health system Change is in most cases inevitable and the Australian healthcare system is no different. According to Dwyer (2004, p.4), the reforms and restructuring of healthcare systems is meant to respond to major challenges encountered in the system before. Specifically, changes are necessary for purposes of enhancing the preventative capacity, the early intervention capacity, and the chronic disease management capacity of the healthcare system (Australian Government, p. 8; Dwyer, 2004, p. 4). Among the major reasons why reform/restructuring is still ongoing is that “the primary care system needs strengthening; what can be done outside hospitals should be; and a continuing focus on safety, performance and accountability is necessary” (Dwyer, 2004, p. 4). The confluence of healthcare professionals (doctors, nurses, administrators, pharmacists among others) also makes changes inevitable, especially because different professionals have different interests, time horizons, and perspectives as noted by Golden (2006, p. 10). In most cases, the changes (at least in a hospital setup) must be led by the administrators. However, they must involve all other professionals in order to obtain the buy-in and support needed to make the reforms or restructured processes successful. Reforms and restructures are also necessary and continuing in health systems because new goals are being realised as time goes by (Golden, 2006, p. 15). Such goals require new behaviours and different tasks to be performed by employees. In some cases, the realisation of the new goals also calls for a re-organisation of existing structures, as well as a change in management policies (ibid.). According to Golden (2006, p. 15), reforms and restructuring also continues in the health system because the expectation of staff in relation to their rewards keep changing. Additionally, members of the staff need sufficient access to information and knowledge in order to make the necessary decisions. The foregoing requires a constant investigation of the system to determine whether workers can indeed access vital information needed for their decision-making. In cases where the access is limited, a reforming or restructuring the system becomes inevitable. Until a time when complete decentralization of healthcare has been attained, and until when reduced waiting times, among other preferable things have been obtained in healthcare, reforms and restructuring will persist in the health system (Liebler &McConnell, 2004, p.1). Influences that pose the most challenges to healthcare manager Healthcare managers face numerous challenges. Among the main influences that pose the major challenges for them include: Disparate stakeholders: At any one time, healthcare managers have to consider the interests of diverse stakeholders who include the government, patients, employees (ranging from professional medics to the subordinate staff), among others. The challenge with dealing with so many stakeholders is that managers face different unions and expectations from all the diverse stakeholder groups. A reform programme may for example unnerve employees. Time and the resources needed to attend to each stakeholder groups is also a challenge that healthcare managers have to contend with (Golden, 2006, p. 11). Multiple missions: According to Golden (2006, p. 11), healthcare organisations are required to among other things “provide healthcare to their communities, remain fiscally solvent and –frequently – be a primary employer in the community”. Juggling between all the aforementioned missions is the responsibility of the healthcare manager. Professional autonomy: According to Golden (2006, p.11), “professionals such as physicians and nurses value professional autonomy”. As such, their decisions have significant influence on how healthcare spending is made. Lack of information: The management function is meant to handle the transformation or restructuring processes that go on in healthcare systems. Yet, Golden (2006, p. 11) notes that managers often lack the necessary information needed to manage the same. Why some health services perform better than others Various reasons explain why some health services perform better than others upon being subjected to reforms or restructured processes. According to Weber and Joshi (2000, p. 388) such reasons include: the clinician’s attitude towards the reforms or restructured processes; the organisational culture present at a given healthcare facility; and the leadership approach used to introduce change in an organisation. The resource-dependence theory can be used to explain why some health services succeed where others fail. According to Fennell and Alexander (1998, p. 169), the foregoing theory posits that organisations are not capable of self-sufficiency. As such, they have to transact with others – i.e. through building bridges with other actors in order to obtain the resources that they need to survive. Used in context, the performance of healthcare services would then be viewed in terms of survival, which is attained through acquiring the needed resources. The ability to remain autonomous when dealing with transactional partners is also essential to survival (Fennell & Alexander 1998, p. 169). In this case therefore, it could be argued that healthcare services that perform well are those able to obtain the required resources while remaining autonomous. Strategic management theory suggests any changes in the processes or procedures should be preceded by analysis, resolution (decision) and actions (Dess, Lumpkin & Taylor 2005, p. 5). On his part, Campbell (2008, p. 23) suggests that some health services survive where others fail because managers use strategic management approaches which such as the 8-step model developed by John Kotter. In the model, Kotter and Cohen (2002, p. 7) suggest that changes should start and end as follows : “developing urgency, building a guiding team, creating a vision, communicating buy-in, enabling action, creating short-term wins, don’t let up, and making it stick”. In other words, carefully planning and executing changes may determine whether a healthcare service survives or not. The population ecology theory posits that organisations (and services) survive because of “natural selection by environmental demands” (Gumport & Sporn, 1999, p. 22). In other words, the changes that occur in services or organisation are perceived as irrelevant and arbitrary, with the environment being regarded as the powerful force that determines what dies or survives. Used in context of a healthcare services setting, the application of the population ecology theory therefore suggests that natural selection is responsible for the survival or death of specific healthcare services. Those services that are fit enough to withstand pressure and competition would be expected to survive, while those who are weak should be expected to die off. Since healthcare services are man-made, one could argue that their ability to survive (even through natural selection) depends on how well the services were designed and implemented. As Cameron (1984, p. 126) observes, “The evolutionary development of characteristics that are compatible with the environment” is responsible for high survival rates for some organisations (and services). On its part, the institutional perspective assumes that the pressure exerted on an organisation by internal and external stakeholders is the major determinant of the structures that the organisation puts in place (Brignall & Modell, 2000 p. 288). Applied in healthcare organisations, the foregoing assumption would be interpreted to mean that healthcare organisations adopt and implement services based on the pressure exerted on them by internal and external stakeholders. The survival (and performance) of services where an organisation has the ultimate decision-making powers, while the stakeholders have the mandate to put pressure on the organisation, is complex. As Meyer and Zucker (1989, p.1) note, performance is narrowly defined based on the extent to which “(a) elites dominate an organisation, (b) a high degree of professionalization exists, and (c) the organisation performs technical function, outputs of which are measurable”. Broadly however, performance in such an organisation depends on the democratic governance therein – i.e. through the presence or absence of formal rules and structures, recognition of interests represented by different stakeholders, and the non-technical nature of the organisation’s outputs (Meyer & Zucker, 1989, p. 1). Healthcare services that survive are arguably those that have the ability to meet the needs of the majority of stakeholders in a satisfactory manner. Approaches and practices for adoption in the management of complex and changing circumstances Since healthcare organisations primarily deal with human interactions, this report suggests the use of a sociological approach of strategic management to manage complex and changing circumstances. According to Stoney (2005, p.1), the sociological approach works on the assumptions of bounded rationality profit sub-optimality, and satisfaction of behaviour. Strategic management has been chosen as the right approach because true to its assumptions, the environment is always changing and healthcare organisations (and others) need to adapt accordingly in order to remain relevant (Stoney, 2005, p.1). Additionally, and in line with strategic management models, the decision-making responsibility in healthcare systems lie with a strategic elite – i.e. the hospital board of directors – who are not distracted by the operational responsibilities, and therefore possess the scope and abilities to think strategically and make good decisions. According to Choo (1992, p.42), strategic management should essentially determine the strategic direction that an organisation should take, as well as the long-term performance that is desirable of the same organisation. Second, strategic management should be responsible for managerial decisions. Third, it should guide internal management decisions and set priorities for the use of resources. As indicated by Choo (1992, pp. 42-43), the strategic management team should adopt the following practices: i. Conduct environmental analysis ii. Develop a vision for the organisation iii. Formulate a strategy that aims at attaining organisational goals iv. Efficiently and effectively implement strategy v. Control strategy through performance evaluation, situation review, and spearheading creative action Through the five stated practices above, healthcare organisations would be better positioned to understand changes happening in both the internal and external environments, and would also be better positioned to formulate strategies that make the organisations more flexible towards the same changes. Conclusion The reasons for continuing reforms or restructuring in healthcare systems are multiple. Largely however, changes in both the internal and external environment trigger the changes seen in healthcare systems as they try to accommodate the needs and preferences of multiple stakeholders. This report has also indicated disparate stakeholders, professional autonomy, multiple missions and lack of information are all factors that pose challenges to healthcare managers. Using different theories, the report has also explained why some healthcare services perform better than others. From the different theories, the report has picked strategic management theory as the most suitable one for application in healthcare organisations, arguing that environment is always changing and healthcare organisations, just like others in the larger economy, need to adapt accordingly in order to remain relevant. Their relevance will however depend on how fast they are able to adapt effectively and efficiently to prevailing external and internal changes. References Australian Government. (2009). 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Governing boards and profound organisational change in hospitals. Medical Care Review 46(2): 157-187. Golden, B. (2006). Transforming healthcare organizations. Healthcare Quarterly 10 (Special Issue), 10-19. Gumport, P. J. & Sporn, B. (1999). Institutional adaptation: demands for management reform and university administration. National Centre for Postsecondary Improvement, pp. Kotter, J. & Cohen, D. (2002). The heart of change. Real life stories of how people change their organization. Boston, MA: Harvard Business School Press. Liebler, J & McConnell, C. (2004). Management principles for healthcare professionals. Burlington MA: Jones & Bartlett Learning. Meyer, M.W. & Zucker, L. G. (1989). Permanently failing organizations. Newbury Part: Sage. Stoney, D. (2005). Lifting the lid on strategic management: a sociological narrative. 1-34, retrieved July 20, 2013, Weber, V. & Joshi, M.S. (2000). Effecting and leading change in health care organisations. 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