Unit I: Management /Organizational

Theories, Structure and Culture

By
Hidayat Khan
MSN, BSN, DCH & CHPE
Lecturer KMU
Objectives
 Discuss different terminologies related to management
 Describe different levels of management.
 Discuss various theories of management.
 Identify different types of health care organizations.
 4. Identify various types of organizational structures
 5. Differentiate between formal and informal structure within
the organization.
 6. Define staff and line relationship
 7. Describe the importance of organizational structure
 8.
 9. Describe redesigning and restructuring in the organization
Management
 Management is the art and science of
doing work.
 As a discipline, management comprises of
the interlocking functions of formulating
corporate-policy and organizing,
planning, controlling, and directing the
firm’s resources to achieve the policy's
objectives.
MANAGEMENT
 Management is the attainment of organizational
goals in an effective and efficient manner through
planning, organizing, staffing, directing and
controlling organizational resources.
 Organizational resources include men(human
beings), money, machines and materials.
Definitions
 Louis E Boone & David L Kurtz- The use of
people and other resources to accomplish
objectives.
 Mary Parker Follet- the act of getting things done
through people.
 Frederick Taylor defines Management as the art
of knowing what you want to do in the best and
cheapest way.
What Is Management?
 Managerial Concerns
 Efficiency
 “Doing things right”
 Getting the most output for
the least inputs
 Effectiveness
 “Doing the right things”
 Attaining organizational
goals
Effectiveness and Efficiency in
Management
 What Do Managers Do?
 Skills Approach
 Technical skills
 Knowledge and proficiency in a specific field
 Human skills
 The ability to work well with other people
 Conceptual skills
 The ability to think and conceptualize about abstract
and complex situations concerning the organization
Skills Needed at Different Management Levels
Who Are Managers?
 Manager
 Someone who
coordinates and oversees
the work of other people
so that organizational
goals can be
accomplished.
Classifying Managers
 First-line Managers
 Individuals who manage the work of non-managerial
employees.
 Middle Managers
 Individuals who manage the work of first-line managers.
 Top Managers
 Individuals who are responsible for making organization-
wide decisions and establishing plans and goals that affect
the entire organization.
Managerial Levels
Top Managers
Responsible for:
 Creating a context for change.
 Developing attitudes of commitment and
ownership in employees.
 Creating a positive organizational culture
through language and action.
 Monitoring their business environments
Middle Managers
Responsible for:
 Planning and allocating resources to meet objectives.
 Coordinating and linking groups, department and
divisions.
 Monitoring and managing the performance of the
subunits and individual managers who report to
them.
 Implementing the changes or strategies generated by
top managers.
 First-line Managers
Responsible for:
 Managing the performance of entry-level employees.

 Teaching entry-level employees how to do their jobs.

 Making detailed schedules and operating plans on

middle management’s intermediate range plans.
Management theories
The Scientific Management theory
Frederick Winslow Taylor (1856–1915) is
known as the father of scientific management.
He detailed his principles on increasing the
productivity of workers in the Midvale Steel
Works plant in Pennsylvania (Taylor, 1911).
His principles included the ideas that:
 Elements of Scientific Management
 Scientific design of every aspect of every task
 Careful selection and training of every task
 Proper remuneration for fast and high-quality
work
 Maximize output - increase pay
 Equal division of work and responsibility between
worker and manager
(Inman, 2000).
General Administrative Theory
Henri Fayol (1841–1925) was a Frenchman who
is remembered for the development of general
administrative theory. He developed his management strategies
in the industry and was writing at about the same time as
Taylor.
Management, according to Fayol’s work, includes five overriding
concepts:
 Plan
 Organize
 Command
 Coordinate
 Control.
Fayol’s Administrative Theory
 Fourteen Principles of Management (Tools for
Accomplishing Objectives)
 Division of work - limited set of tasks
 Authority and Responsibility - right to give
orders
 Discipline - agreements and sanctions
 Unity of Command - only one supervisor
 Unity of Direction - one manager per set of
activities
 Subordination of Individual Interest to
General Interest
 Remuneration of Personnel - fair price for
services
 Centralization - reduce importance of
subordinate’s role
 Scalar Chain - Fayol’s bridge
 Order - effective and efficient operations
 Equity - kindliness and justice
 Stability of Tenure of Personnel - sufficient
time for familiarity
 Initiative - managers should rely on workers’
initiative
 Esprit de corps - “union is strength” “loyal
members
Bureaucratic Management
Max Weber (1846–1920) was a German sociologist who
developed what was known as the “ideal bureaucracy.” The
ideal bureaucracy includes the concepts of
 division of labor,
 authority hierarchy,
 formal selection,
 formal rules and regulations,
 impersonality,
 and career orientation.
Theory of Bureaucracy
 Concerned with describing the ideal structure of
an organization
 Cornerstone: existence of written rules

 The rational application of written rules ensures the

promotion of legitimate authority and the effective
and efficient functioning of the organization.
 Types of Health
Care Organizations
 Types of Health Care Organizations
Classification of health care agencies:
Agencies providing health care can be classified in one of three
ways:

Classifications by length of Classification by type of Classification by type of

stay services: ownership:

● Short stay ● General vs. specialty ● Governmental

● Traditional acute
care
● Community vs. tertiary ● Non-Governmental
● Long –term care ● Sub-acute(transitional) * For-profit
care * Non-for-profit
● In-home care
● Ambulatory care
Types of Health Care Organizations

Classification according to length of

stay:
1) Short-stay facilities:
● Which provide services to patients/clients
who are suffering from acute conditions that require less than 24
hrs of care.

● Short stay may take place in separate units in a hospital, or in

short –stay centers.
Types of Health Care Organizations

2) Traditional acute care:

● It takes place in the hospital.
● It includes patients staying more than 24 hrs but fewer than 30 days.

3) Long term care :

● Which include those agencies that offering services to patients
with major rehabilitation needs, chronic diseases, functional losses, or
mental illness.
● The average length of stay extends from
several months to years.
Types of Health Care Organizations

Classification by type of service:

1) General hospital:
● Which offers medical, surgical. Obstetric,
emergency, and diagnostic as well as laboratory
services.
Types of Health Care Organizations

2) Specialty hospital:
● Which offers only a particular type of care. such as:
- psychiatric hospitals
- women's hospitals
- children's hospitals

● Specialty hospitals tend to be less common than general

hospitals
Types of Health Care Organizations

3) Community hospital:
● Which provides those services provided in the
general hospital but for specific community.
Types of Health Care Organizations
4) Tertiary hospital:
●Which are serving as referral centers for clients with
complex or unusual problems.
●They have the facilities for specialized types of care such as
burn centers, bone marrow transplant centers, as well
as resources for general care.
●They serve a wide geographic area in addition to their own
community.
●Usually associated with a university or are a part
of a large medical center.
Types of Health Care Organizations
6) In-home services:
●Which are provided in the community health care
agencies, by health care professional including nurses,
physical therapists, social workers, and home health care
aid.
● this care may be:
1) Short–term: teaching and monitoring after
hospitalization
2) Intermediate-term: to assist an
individual until self-care is possible
3) Long-term: for those with ongoing health
problems
Types of Health Care Organizations

7) Ambulatory care:
● Which refers to care services provided to persons
who are not hospitalized
● The ambulatory settings include:

The outpatient surgery centers

Minor emergency clinics
Outpatient dialysis units
Outpatient birthing centers
Types of Health Care Organizations

Classification by ownership

1) Governmental Organizations:
Owned, administered, and controlled by government
Provide free care for patients
May offer private accommodation for free-paying
patient
Types of Health Care Organizations

The governmental hospital are owned by:

a- The Ministry of Health
b- The University
c- Military personnel
d- Health insurance organization
e- Health care organization
Types of Health Care Organizations

2) Non-Governmental Organizations:

For-profit agencies (PRIVATE):

owned, operated, and controlled by individuals, groups, or
private organizations.
Types of Health Care Organizations

Non-for-profit agencies (Voluntary health agencies):

● Owned and operated by non-profit groups or

organizations (e.g. religious bodies & community boards)

● The original capital costs are obtained in a variety of ways

(e.g. through donation)
 Introduction to “Organization”
Organizational structure
Definition

Formal and informal framework of policies and rules,

within which an organization arranges its lines of authority
and communications, and allocates rights and duties.
 Introduction to “Organization”

Organizational Structure

Organizational structure determines the manner and extent

to which roles, power, and responsibilities are delegated,
controlled, and coordinated, and how information flows
between levels of management.
This structure depends entirely on the organization's
objectives and the strategy chosen to achieve them.

ORGANIZATIONAL STRUCTURE

CENTRALIZED DECENTRALIZED
STRUCTURE STRAUCTURE
 Centralized Structure :

Top mgt to take

Decision

Exercise of Control
over

Departments and
Divisions

In a centralized structure, the decision making power is

concentrated in the top layer of the management and tight
control is exercised over departments and divisions
 De Centralized Structure :

Dept-1 Dept-2
Central
Governance

Dept-3

In a decentralized structure, the decision making power is

distributed and the departments and divisions have varying
degrees of autonomy.
 Pre-bureaucratic structures

Pre-bureaucratic (entrepreneurial) structures lack

standardization of tasks. This structure is most common in
smaller organizations and is best used to solve simple tasks.
The structure is totally centralized.
The strategic leader makes all key decisions and most
communication is done by one on one conversations. It is
particularly useful for new (entrepreneurial) business as it
enables the founder to control growth and development.
 Bureaucratic structures

Bureaucratic structures have a certain degree of

standardization. They are better suited for more complex or
larger scale organizations. They usually adopt a tall
structure.
Then tension between bureaucratic structures and non-
bureaucratic is echoed in distinction between mechanistic
and organic structures.
Mechanistic structure
 Hierarchical, bureaucratic, organizational
structure characterized by
 (1) centralization of authority,
(2) formalization of procedures and practices, and
(3) specialization of functions.
Mechanistic organization are comparatively simpler and easy to
organize,but find it difficult to cope with rapid change.
Organic structure
Organizational structure characterized by
 (1) Flatness: communications and interactions are horizontal,
 (2) Low specialization: knowledge resides wherever it is most
useful, and
 (3) Decentralization: great deal of formal and
informal participation in decision making.
Organic organizations are comparatively more complex and harder
to form, but are highly adaptable, flexible, and more suitable
where external environment is rapidly changing and is
unpredictable.
Functional Structure

In a functional structure, the division of labor in an

organization is grouped by the main activities or
functions that need to be performed within the
organization -- sales, marketing, human resources,
and so on. Each functional group within the
organization is vertically integrated from the bottom
to the top of the organization. For example, a Vice
President of Marketing would lead all the marketing
people, grouped into the marketing department.
 Employees within the functional divisions of an
organization tend to perform a specialized set of tasks,
for instance the engineering department would be
staffed only with engineers. As a whole, a functional
organization is best suited as a producer of standardized
goods and services at large volume and low cost.
Functional structure
Functional structure
 Divisional Structure
Also called a "Product Structure", the divisional structure groups each
organizational function into a divisions. Each division within a divisional
structure contains all the necessary resources and functions within it.

For example, an automobile company with a divisional structure might have

one division for SUVs, another division for subcompact cars, and another
division for sedans.

Each division would have its own sales, engineering and marketing
departments
Divisional structure
 Matrix Structure
Matrix structure groups employees by both function and product.
This structure can combine the best of both separate structures.
A matrix organization frequently uses teams of employees to
accomplish work, in order to take advantage of the strengths, as well
as make up for the weaknesses, of functional and decentralized
forms.
An example would be a company that produces two products,
"product a" and "product b".
Using the matrix structure, this company would organize functions
within the company as follows: "product a" sales department,
"product a" customer service department, "product a" accounting,
"product b" sales department, "product b" customer service
department, "product b" accounting department. Matrix structure
is the most complex of the different organizational structures.
Matrix Structure
Matrix structure
 Differentiate between formal and informal structure within
the organization.
 staff and line relationship