Healthcare Organizational Structure and Philosophy

Organizing

• Involves: Identifying work, dividing labor, developing chain of command and assigning authority
• In healthcare, mission, organizational structure, delivery systems, job descriptions, skill mix and staffing patterns form the basis

Philosophy

• Defines organizational values, vision and mission
• Written statement reflecting beliefs and values
• Nursing service philosophy should focus on holistic care, education and research

Vision

• Describes future state of the organization
• Aspirations of leaders drive the vision
• Should keep stakeholders focused on goals and the future

Mission

• Brief statement identifying the organization’s reasons for existing
• Highest priority in planning hierarchy
• Influences development of philosophy, goals, objectives, policies, procedures and rules

Policies

• Broad guidelines for managerial decisions
• Serve as basis for future actions and decisions
• Direct individual behavior towards the organization’s mission

Procedures

• Specific directions for implementing written policies
• Establish customary/acceptable ways to accomplish tasks
• Delineate sequence of steps required for action

Rules

• Define specific actions or non-actions
• Describe situations that allow only one choice of action
• Fewer rules is better

Organizational Structure

• Depicts formal organizational relationships
• Areas of responsibilities
• Person to whom one is accountable
• Channels of communication

Span of Control

• Number of direct reports a supervisor has
• Complex organizations have many highly specialized departments and a tall organizational structure with small differentiated work groups
• Supervisor should be able to effectively manage the group based on numbers, functions and geography

Functional Structures

• Employees grouped in departments by:
  • Specialty
  • Similar tasks performed by trained individuals
  • Reporting to the same manager
  • Centralized decision making
• Coordination between and among other functional areas may be limited

Service-line Structures

• Most common structure in healthcare
• Designed for rapid response in a changing environment
• Coexists with functional structures
• Example: Oncology nurse may work in the oncology service line, but also have ties to the functional area of nursing

Matrix Structure

• Integrates service-line and functional structures
• Manager is responsible for both function and product line
• Major weakness is dual authority which can cause frustration and confusion
• Strong interpersonal skills are required from leaders to resolve conflict
• Example: Oncology clinic nurse manager may report to the VP of nursing and the VP of outpatient services.

Planning

• Addresses questions of what, why, where, when, how and by whom
• Determines organizational structure, staffing and budgets
• Evolves from mission, philosophy and goals
• Can be reactive to a crisis or proactive in anticipation of problems or opportunities

Types of Planning

• Strategic or long-range planning: Determines long-term objectives and policies to achieve them. Future-oriented. Done at the executive level.
• Short-range planning or operational planning: Pertains to specific departments. Deals with tactics and techniques to achieve organizational goals.

Planning Hierarchy: Terms

• Vision: Outlines future role and function.
• Mission: Reason for existing, target clients and services provided.
• Philosophy: Statement of beliefs and values that guide practice.
• Goals: General, broad action commitments.
• Objectives: Specific, concrete action commitments.
• Policies: Broad guidelines for managerial decisions.
• Procedures: Specific directions for implementing policies.
• Rules: Define specific actions or non-actions.

Classification of Planning

• Operating Budget (Annual): Expenses, revenue, profit.
• Financial Budget: Cash, capital expenditure, balance sheet.
• Incremental Budget: Manpower, operating.
• Zero Based Budget: Requires justification for all items.
• Fixed or Variable Budget: Dependent on volume.

Management Process

• Planning: Determining the most appropriate type of patient care delivery.
• Organizing: Grouping activities to meet unit goals.
• Staffing: Recruiting, interviewing, hiring, orienting, scheduling, staff development, employee socialization and team building.
• Directing: Understanding and using power and authority appropriately.
• Controlling: Evaluating performance and taking corrective action.

Manager

• Responsible and accountable for efficiently accomplishing organizational goals.
• Focuses on: Coordinating resources, planning, organizing, supervising, staffing, evaluating, negotiation and representation.
• Has authority, responsibility, accountability and power defined by the organization.
• Requires interpersonal skills.

Leadership Theories

• Most effective leadership style complements organizational environment, tasks and personal characteristics of those involved.

Shared Leadership

• Based on empowerment principles of participative and transformational leadership.
• Many individuals at various levels are responsible for organizational fate and performance.
• Reasons for valuing shared leadership: Reorganization, decentralization and increasing complexity of problem solving in healthcare.

Levels of Managers

• First-level Manager: First-line manager or unit manager.
• Middle-level Manager: Department Manager.
• Top-level Manager: Executive manager, Chief Nursing Officer, Vice President of Patient Care.
• All nurse managers must hold certain competencies.