a Cages nectuee | WOO © MHSA 7620 - Healthcare Administration Essential Functions of Management ‘The Organizing Function ‘The formal definition of the management process included the concept of the presence ofa formal organizational setting within which managers could execute processes towards the achievement of organizational objectives. The essence of what the organizing function of management involves may be best summarized by the various activities that are conducted by various levels of management towards the goal of assuring cooperation within/among the organization's components: ** — Senior-level ~ broad, organization-wide responsibilty for establishing authority and responsibility relationships at all levels, general departmentation strategies, establishing mechanisms to ensure cooperation among departments, and development of organizational structure(s) for the entire organization. ** Mid-level -- responsible for organizing workgroups and clusters of workgroups, primarily within functional areas of the organization/departments. ** Supervisor-level -- responsible for the organization of individual work positions, including the development of job design, work flow, and work methods. Many of the organizing activities of management occur within the generic management model during the inputs conversion process, where structures (authority relationships, formal coordination methods, etc.), tasks/technologies (job design, work processes, etc.), and people (AR activities) are integrated to varying degrees for the purpose of accomplishing organizational objectives (outputs). Thus, organizing as a management function is critical to the inputs conversion process. Concepts of (Formal) Organizational Design ** Max Weber (Bureaucracy Theory) ~ bureaucratic organizational structures as a rationalization of collective activities. Characteristics of bureaucratic structures include: 1. Clear division of labor among specialized workers, with formal recognition of such as an official work duty. 2. Defined hierarchy of authority where higher positions in the structure have authority over/are responsible for the activities of lower positions. 3. Formal rules and regulations to uniformly guide the actions of all workers 4. Impersonal work relationships between managers and workers, with focus on performance vs. personal attributes. 5. Competence-based employment where workers are rewarded solely based on performance and seniority.* Division of Labor -- specific work relegated to specific workers * * Economic justification for division of labor based on general efficiency argument (increased efficiency due to specialization of tasks). Operationally, increased specialization also results in increased proficiency of labor. DOL forms the primary justification for the use of departmentation (discussed below) within organizational structures. Primary drawbacks to DOL include worker monotony, burnout, job dissatisfaction due to repetitive nature of work. Management issues related to dealing with DOL include the development of mechanisms for addressing negative aspects of DOL (monotony, burnout) ~- leadership/motivation issues (discussed in a later lecture). Assigning Authority/Responsibility Relationships -- who answers to whom, who is responsible for whose activities? ” a Authority: power derived as a result of a person’s formal position within an organization. Responsibility: obligation to perform certain functions or achieve certain objectives derived as a result of a person’s formal position within an organization. Scalar Principle: delegation of authority in a linear fashion from higher to lower level management. Senior management has higher authority within the organization and thus also has a higher level of responsibility; lower level management has lower authority and thus lower levels of responsibility. Scalar principle requires that authority and responsibility relationships should be congruent and directly related to organizational position. ‘Types of authority: 1 Line authority - command-based, direct authority and responsibility over the activities of subordinates. (eg. chain of command within organization) 2. Staff authority -- advisory-based, indirect authority whose purpose is to provide input/counsel to line authority for the purpose of assisting with line authority decisions.a ” Departmentation -- organizational response to need for di Sources of authority: 1. Formal -- authority related to formal management position within the organization. Such power/authority is derived from legitimate, reward, and coercive sources. 2. Informal -- authority that is not related to formal mgmt. position within the organization; more related to an individuals expertise and their influence on other workers. Principles of delegation of authority: generally speaking, organiz~ ational theory postulates that all organizational decisions should ‘be made at the lowest possible level within the organization, ‘commensurate with the scalar principle of authority. (i.e. allowing decisions to be made by those whose authority/responsibility is compatible with the type of decision being made). ** In general, the more authority that is delegated down the organizational structure, the more decentralized the decision-making process. The less delegation, the more centralized. ion of labor as well as the need for coordination of labor activities among discrete organizational units Departmentation has traditionally been based on any of a number of criteria: common knowledge and skills of workers, common processes/functions, time within which work is accomplished, type of output produced, client group being served, physical location within which work is accomplished. ‘The goals of departmentation are obvious: allows for the facilitation of work processes by management, allows for the sharing of resources, allows for common performance measures, and allows/facilitates communication within and between departments. Newer trends in departmentation within HSO’s include the grouping of workers based on patient characteristics rather than worker characteristics, and the use of matrix approaches to addressing departmentation problems in the project management process.** Span of Control -- the numbers and types of workers that a manager has direct line authority over (# of direct reports). Different types of span of control include executive span of control and operational span of control. +* Factors influencing SOC decisions (i.e. how many persons will a manager have direct line authority over?) * Professionalism/training of subordinates -- the more professionaV/highly trained subordinates are, the greater the SOC can be (supervise more workers). Uncertainty of work — complex tasks require closer supervision than repetitive tasks, thus necessitating smaller SOC’s, other factors being equal. Degree of work standardization -- routine, non-specialized types of work require less supervision, and thus SOC can be larger for these types of managers. Degree of required interaction ~- between managers and workers; the greater the amount of interaction required, the smaller the SOC must be. Degree of task integration required -- the more integration required of work processes/outputs, the greater the amount of interaction/supervision required, and the smaller the SOC must be. ** Coordination of Work - pulling together of all activities of the organizational enterprise to make possible its working and success. ** Mechanisms of Coordination (Mintzberg): Mutual adjustment among workers (voluntary) by informal means, allowing for coordination of work. Direct supervision of management, whereby management has organizationally appointed authority and responsibility over subordinates, and facilitates coordination thusly. Standardization of work processes allows for coordination of work activities by specifying the contents of work processes among workers.** Standardization of outputs specifies the product or expected performance, allowing for indirect coordination. ** Standardization of worker skills may be utilized for coordination purposes when other standardization mechanisms (work processes, outputs) are not feasible. Accomplished primarily through worker training. Outcomes of Organizational Design Process ‘The organizational chart is a schematic representation of all organizational principles discussed: division of labor among functional areas of HSO, assigning of authority and responsibility within the organization (staff and line), departmentation schemes to include grouping strategies to form functional units, span of control for each identified management entity, and general responsibilities for coordination among functional units. Examples of General Organizational Designs (Mintzberg) Organizational typology: (1) strategic apex -- persons who set the strategic focus of the organization; (2) middle line -- mid-level management who function between strategic mgmt. and operations staff; (3) operational core workers who perform the basic work functions of the organization; (4) technostructure -- staff members who help plan and control the basic work of the organization; (5) support staff -- support the operational core by providing support services to the organization’s basic work processes. ** Simple Structure — small strategic apex, large operating core, little/no support staff/technostructure. (Small businesses) *“* Machine Bureacracy - classic bureaucratic design, top-down hierarchy of command/control, rigid lines of authority, narrow spans of control, centralized decision making. (Manufacturers, some HSOs) ** Professional Bureaucracy -- operating core primarily composed of highly trained professionals in specific areas; decentralized decision-making (small strategic apex), small technostructure, large, well-developed support staff to support professional activities. (HSO’s, especially hospitals) ** Divisionalized Form -- independent units joined by shared administrative oversight; decentralization of decision making to the division level, large, well developed mid-line structures - division level. (Multi-hospital systems).Adhocracy -- operational and administrative adhocracies, fluid, ‘ad hoc” type of structure that changes to adapt to the specific needs of the organization at a specific point in time. (Project teams, patient care teams, etc.)