Dunn and Haimann's Healthcare Management, Eleventh Edition

By Rose T. Dunn

Healthcare organizations strive to keep pace with breakthroughs in medical science and technology, transparency of service outcomes, an educated customer base, global health threats, and federal regulations. As these elements continue to evolve, organizations are tasked with employing well-trained, dynamic healthcare managers to lead in a time of perpetual transformation.

Dunn & Haimann's Healthcare Management provides a definitive overview of healthcare management, organized around five primary functions: planning, organizing, staffing, influencing, and controlling. The book ties these primary functions together through clear explanations of management theories, tools, and other foundational information. It also explores the role of supervisors, behavioral factors, and generational stimuli that motivate employees within the conceptual framework of managing.

This eleventh edition incorporates significant new material while retaining the book's emphasis on basic managerial concepts and functions. Extensive updates and new content include: Coverage of big data, bundled payments, business intelligence, patient-driven payment models, disruption, Icarus Syndrome, and artificial intelligence Discussion of the emerging trends confronting today's healthcare organizations Definitions of the planning function and the distinction between strategy and planning An exploration of new technologies, including social media, virtual team software applications, and crowdsourcing, and their impact on management decisions Information on prominent management concepts and theories, including Covey's Wildly Important Goal, Doerr's Objectives and Key Results, and Sirota's Enthusiastic Employee model of motivation Analysis of connective processes, quality improvement, compliance, regulatory issues, and collective bargainingNew features at the end of most chapters, including additional readings, classroom activities, and case study recommendations, reinforce the concepts presented.A healthcare system will always be better positioned to grow and adapt if its managers have mastered the primary functions covered in this book.

• Language: English
• Publisher: Health Administration Press
• Release date: Jan 11, 2021
• ISBN: 9781640552234

Book preview

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The statements and opinions contained in this book are strictly those of the author and do not represent the official positions of the American College of Healthcare Executives or the Foundation of the American College of Healthcare Executives.

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Library of Congress Cataloging-in-Publication Data

Names: Dunn, Rose, author. | Association of University Programs in Health Administration, issuing body.

Title: Dunn and Haimann’s healthcare management / Rose T. Dunn.

Other titles: Dunn & Haimann’s healthcare management | Healthcare management

Description: Eleventh edition. | Chicago, Illinois : Health Administration Press ; Washington, DC : Association of University Programs in Health Administration, [2021] | Preceded by: Dunn & Haimann’s healthcare management / Rose T. Dunn. Tenth edition. [2016]. | Includes bibliographical references and index. | Summary: This classic textbook provides a definitive overview of healthcare management, organized around five primary functions: planning, organizing, staffing, influencing, and controlling. The book ties these primary functions together through clear explanations of management theories, tools, and other foundational information — Provided by publisher.

Identifiers: LCCN 2020034227 (print) | LCCN 2020034228 (ebook) | ISBN 9781640552210 (hardcover ; alk. paper) | ISBN 9781640552234 (epub) | ISBN 9781640552241 (mobi)

Subjects: MESH: Health Facility Administration | Personnel Management

Classification: LCC RA971 (print) | LCC RA971 (ebook) | NLM WX 150.1 |

DDC 362.1068—dc23

LC record available at https://lccn.loc.gov/2020034227

LC ebook record available at https://lccn.loc.gov/2020034228

The paper used in this publication meets the minimum requirements of American National Standard for Information Sciences—Permanence of Paper for Printed Library Materials, ANSI Z39.48-1984. ™

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BRIEF CONTENTS

Preface

Part I Stepping into Management

Chapter 1. The Supervisor’s Job, Roles, Functions, and Authority

Chapter 2. The Theories and History of Management

Part II Connective Processes

Chapter 3. Decision Making

Chapter 4. Coordinating Organizational Activities

Chapter 5. Communicating

Chapter 6. Legal Aspects of the Healthcare Setting

Chapter 7. Emerging Influences in Healthcare

Part III Planning

Chapter 8. Managerial Planning

Chapter 9. Tactical Considerations in Planning

Chapter 10. Planning Tools

Chapter 11. Time Management Techniques

Part IV Organizing

Chapter 12. Fundamental Concepts of Organizing

Chapter 13. Division of Work and Departmentalization

Chapter 14. Delegation of Authority

Chapter 15. Process and Quality Improvement and the Effect on Reorganization

Chapter 16. Committees as an Organizational Tool

Chapter 17. The Informal Organization

Part V Staffing: Human Resources Management

Chapter 18. The Staffing Process

Chapter 19. The Selection Process

Chapter 20. Performance Appraisals and Position Changes

Part VI Influencing

Chapter 21. Giving Directives and Managing Change

Chapter 22. Motivation

Chapter 23. Morale

Chapter 24. Discipline

Chapter 25. Leadership

Part VII Controlling

Chapter 26. Fundamentals of Control and the Controlling Function

Chapter 27. Budgeting

Part VIII Labor Relations

Chapter 28. The Labor Union and the Supervisor

Chapter 29. Handling Grievances

Glossary

References

Index

About the Author

DETAILED CONTENTS

Preface

Part I Stepping into Management

Chapter 1. The Supervisor’s Job, Roles, Functions, and Authority

Chapter Objectives

The Healthcare Perspective

The Demands of the Supervisory Position

The Managerial Aspects of the Supervisory Position

The Meaning of Management

Managerial Functions and Authority

Expect Surprises

Benefits of Better Management

Stepping into Management

Summary

Notes

Review Questions

Additional Readings

Class Activity

Case Study

Chapter 2. The Theories and History of Management

Chapter Objectives

Industrial Revolution (1700s–1800s)

Classical School (1800s–1950s)

The Behavioral Movement (1920s–1950s)

Human Resources School (1950–Present)

Contemporary Management Theories (1940s–Present)

Organizational Development (Late 1950s–Present)

Entrepreneurial Theory (1970s–Present)

Cultural Theory (1970s–Present)

Theory C (2007–Present)

Summary

Note

Review Questions

Additional Readings

Class Activities

Part II Connective Processes

Chapter 3. Decision Making

Chapter Objectives

Programmed and Nonprogrammed Decisions

The Importance of Decision-Making Skills

Steps in the Decision-Making Process

Avoiding Unethical Decisions

Summary

Review Questions

Additional Readings

Class Activity

Case Study

Chapter 4. Coordinating Organizational Activities

Chapter Objectives

The Meaning of Coordination

Coordination, Cooperation, and Collaboration

Difficulties in Attaining Coordination

Coordination and Managerial Functions

Coordination and Decision Making

Coordination and Communication

Dimensions of Coordination

The Role of Coordinator

Summary

Review Questions

Additional Readings

Case Study

Chapter 5. Communicating

Chapter Objectives

The Nature of Communication

Communication Network

Formal Channels

Communication Media

The Manager’s Role in Communication

Barriers to Communication

Overcoming Barriers to Improve Communication Effectiveness

The Grapevine: The Informal Communication Network

Summary

Review Questions

Additional Readings

Class Activities

Case Study

Appendix 5.1: Memo Examples

Poorly Written Memo

Well-Written Memo

Appendix 5.2: Guidance for Better Communication

Language

Chapter 6. Legal Aspects of the Healthcare Setting

Chapter Objectives

Liability

Employee Litigation

The Role of the Compliance Department

Summary

Notes

Review Questions

Additional Readings

Class Activities

Chapter 7. Emerging Influences in Healthcare

Chapter Objectives

The Force of Change

Changing Occupations and Workforce

Savvy Consumers and Satisfaction

Changing Technology and Medicine

Erratic Economic and Regulatory Environment

Policies and Oversight

Changing Staff Issues

Changing Communication Methods

Cost and Outcomes

Summary

Notes

Review Questions

Additional Reading

Class Activity

Appendix 7.1: First-Time Management Blunders

Appendix 7.2: The Manager’s Bookshelf

Part III Planning

Chapter 8. Managerial Planning

Chapter Objectives

The Nature of Planning

Forecasting Trends

Supervisory Forecasts

Benefits of Planning

The Strategic Planning Process

The Use of Objectives in Planning

Monitoring the Effectiveness of the Strategic Plan

Summary

Notes

Review Questions

Additional Readings

Class Activity

Case Study

Appendix 8.1: Managers’ Input to Strategic Planning Process

Appendix 8.2: Board of Trustees’ SWOT Comments

Chapter 9. Tactical Considerations in Planning

Chapter Objectives

The Supervisor as a Change Agent

Planning Strategies

Utilization of Resources

Safe Environment

Utilization of Space

Utilization of Materials and Supplies

Utilization of Workforce

Summary

Notes

Review Questions

Additional Readings

Class Activity

Case Study

Chapter 10. Planning Tools

Chapter Objectives

Policies

Procedures

Methods

Rules

Organizational Manuals

Programs and Projects

Budgets

Summary

Review Questions

Additional Readings

Class Activities

Appendix 10.1: Policy and Procedure Template

Appendix 10.2: Work Simplification

Chapter 11. Time Management Techniques

Chapter Objectives

Use of Time

Time-Use Chart

Managing Employees’ Time

Summary

Notes

Review Questions

Additional Readings

Class Activities

Part IV Organizing

Chapter 12. Fundamental Concepts of Organizing

Chapter Objectives

Formal Organization Theory

Two Key Concepts

Authority

Line and Staff

Span of Management

Summary

Review Questions

Additional Readings

Classroom Activity

Chapter 13. Division of Work and Departmentalization

Chapter Objectives

Division of Work or Job Specialization

Departmentalization

Organizing at the Supervisory Level

Departmental Organizational Structure

Organization and Personnel

Organizational Design

Organizational Charts

Summary

Notes

Review Questions

Additional Readings

Class Activity

Case Study

Chapter 14. Delegation of Authority

Chapter Objectives

The Meaning of Delegation

The Scalar Chain (Chain of Command)

The Process of Delegation

Availability of Trained Subordinates

Recognition

Equality of the Three Essential Parts

Centralization–Decentralization Continuum

Achieving Delegation of Authority

Organizational Maturity

Delegation and General Supervision

Advantages and Disadvantages of Delegation

Summary

Note

Review Questions

Additional Readings

Class Activity

Chapter 15. Process and Quality Improvement and the Effect on Reorganization

Chapter Objectives

Reorganization

Quality’s Role as a Change Agent

Reorganization Effects on Staff

The Supervisor’s Role in Quality Management

Tools to Assist with Reorganization or Process Improvement

What Is Quality?

Demonstrating Progress

An Example of Six Sigma

Six Sigma Versus Lean Versus Kaizen

Reorganizing and Reengineering

Downsizing

Summary

Notes

Acknowledgments

Review Questions

Additional Readings

Class Activity

Case Studies

Chapter 16. Committees as an Organizational Tool

Chapter Objectives

The Nature of Committees

Functions of Committees

Benefits of Committees

Drawbacks of Committees

The Effective Operation of a Committee

The Committee Meeting

Summary

Note

Review Questions

Additional Readings

Class Activity

Chapter 17. The Informal Organization

Chapter Objectives

The Genesis of the Informal Group

Benefits Derived from Groups

Structure and Function of the Informal Organization

The Supervisor and the Informal Organization

Summary

Review Questions

Additional Readings

Part V Staffing: Human Resources Management

Chapter 18. The Staffing Process

Chapter Objectives

The Staffing Function and the Human Resources Department

Staffing and Legal Implications

Functional Authority and the Human Resources Department

The Supervisor’s Staffing Function

Job Design

The Organizing Side of Staffing

Summary

Notes

Review Questions

Additional Readings

Class Activities

Chapter 19. The Selection Process

Chapter Objectives

Early Assessment

The Art of Interviewing

The Employment Interview

Evaluating the Applicant

Testing the Applicant

Diversity

Making the Decision

Summary

Note

Review Questions

Additional Readings

Class Activity

Chapter 20. Performance Appraisals and Position Changes

Chapter Objectives

The Performance Appraisal System

Performance Appraisal Methods

Performance Appraisal Purposes and Timing

Who Is the Appraiser?

Performance Rating

Preparing for the Interview

The Appraisal Interview

Proper Wages, Salaries, and Benefits

Mentoring, Skill Building, and Succession Planning

Promotion

Summary

Notes

Review Questions

Additional Readings

Class Activity

Part VI Influencing

Chapter 21. Giving Directives and Managing Change

Chapter Objectives

Characteristics of Good Directives

Directing Techniques

Explaining Directives

General Supervision Compared with No Supervision

Team Management

Change and Influencing

Summary

Review Questions

Additional Readings

Class Activity

Chapter 22. Motivation

Chapter Objectives

Theories of Motivation

Models of Motivational Processes

Perceptions, Values, and Attitudes

Modifying Motivational Techniques

Working with the Generations

Temporary Workers

Summary

Notes

Review Questions

Additional Readings

Class Activities

Appendix 22.1: One More Time: How Do You Motivate Employees?

Motivating with KITA

Hygiene vs. Motivators

Appendix 22.2: Principles of Vertical Job Loading

Principal Motivators Involved

Steps to Job Enrichment

Concluding Note

Chapter 23. Morale

Chapter Objectives

The Nature of Morale

The Level of Morale

Factors Influencing Morale

The Supervisor’s Role in Morale

The Effects of Morale

Assessing Current Morale

Summary

Review Questions

Additional Readings

Class Activities

Case Studies

Appendix 23.1: Sample Flex-Time Policy

Appendix 23.2: University of Texas Medical Branch Telecommuting Agreement

Chapter 24. Discipline

Chapter Objectives

Organizational Discipline

When Disciplinary Action Is Warranted

Disciplinary Layoff or Suspension

The Supervisor’s Dilemma

The Red-Hot Stove Approach

Discipline Without Punishment

Right of Appeal

Just Culture

Summary

Notes

Review Questions

Additional Readings

Class Activity

Case Studies

Chapter 25. Leadership

Chapter Objectives

Leadership Theories

Leadership Roles

Leadership Style

Energizing Staff

Diversity Challenges

Social Responsibility

Summary

Review Questions

Additional Readings

Class Activities

Case Study

Part VII Controlling

Chapter 26. Fundamentals of Control and the Controlling Function

Chapter Objectives

The Nature of Control

Human Reactions to Control

The Supervisor and Control

The Anticipatory Aspect of Control

Control Systems

The Feedback Model of Control

Closeness of Control

Basic Requirements of a Control System

Steps in the Supervisor’s Control Function

Benchmarking

Functions Closely Aligned with Controlling

Data Analytics

Additional Controls

Summary

Note

Review Questions

Additional Readings

Class Activities

Case Study

Chapter 27. Budgeting

Chapter Objectives

The Nature of Budgeting and Budgetary Control

The Supervisor’s Concern About Budgeting

Numerical Terms in Budgeting

Making the Budget

The Supervisor’s Participation in Budgeting

Budgeting Approaches

Types of Budgets

Preparing the Budget

Other Budget Considerations

Summary

Notes

Review Questions

Additional Readings

Class Activity

Case Studies

Part VIII Labor Relations

Chapter 28. The Labor Union and the Supervisor

Chapter Objectives

The Nuances of Unions

Unionization and Labor Negotiations

The Supervisor and the Shop Steward

Employee-Friendly Legislation

Summary

Review Questions

Additional Readings

Chapter 29. Handling Grievances

Chapter Objectives

The Shop Steward’s Role

The Supervisor’s Role

Complaint Resolution at Nonunionized Organizations

Summary

Note

Review Questions

Additional Readings

Class Activity

Glossary

References

Index

About the Author

PREFACE

The challenges facing the healthcare industry today will require fine-tuned managerial skills. Healthcare managers must keep pace with revolutionary and sophisticated breakthroughs in medical science and technology, transparency of service outcomes and charges, an educated customer base, an aging population, global health threats, and federal regulations growing exponentially.

At the center of all these changes is the supervisor, who has to bring and hold together the human and physical resources, professional expertise, technologies, and other support systems necessary to provide care efficiently, effectively, and economically. Therefore, healthcare managers and supervisors must understand the complexities of the organization, generational motivational differences, regional and national healthcare demands, and the industry as a whole.

The twenty-first century healthcare organization is much different from the one where Theo Haimann first coached new supervisors in the early 1970s. However, his belief then remains accurate today—the hardest job in any organization is clearly that of the supervisor. The supervisor is responsible for motivating the team to achieve organization goals as set by the board of directors and senior leadership. The supervisor must be able to translate the goals into understandable and achievable terms for team members and gain their buy-in; without the buy-in, the organization could fail.

Many first-level and middle-management team leader positions—such as department managers, supervisors, and group leaders—are filled by individuals with excellent technical skills who have limited or no formal education or training in administration, management, and supervision. This book is intended for these individuals.

The book is introductory in that it assumes no previous knowledge of the concepts of supervision and management. As such, this book also is written for students taking an introductory course in management, and it will acquaint them with their future roles in any organization (healthcare or otherwise). It can be used in any course in which managerial, supervisory, and leadership concepts are studied.

Because this book is designed to aid people with their supervisory tasks, it serves as a reference for those individuals who already hold managerial positions. Its purpose is to demonstrate that proficiency in supervision better equips them to cope with the ever-increasing demands of getting the job done. Because nonhealthcare entities have had success dealing with change and implementing efficient and effective practices, this book draws on many sources for its content to permit the supervisor to apply lessons learned by others, regardless of whether they were experienced in a healthcare environment.

To provide a practical organization for the book’s management knowledge, I have chosen to use the functions of management as the primary framework: planning, organizing, staffing, influencing, and controlling. Each function is thoroughly addressed by breaking down and explaining its relationship to the material already presented. This approach allows any new knowledge, from behavioral and social sciences, quantitative approaches, or any other field, to be incorporated at any point.

The supervisor’s job—to get things done with and through people—has its foundation in the relationship between the supervisors and the people with whom they work. For this reason, the supervisor must have considerable knowledge of the human aspects of supervision—that is, the behavioral factors and generational stimuli that motivate employees. This book attempts to present a balanced picture of such behavioral factors in the conceptual framework of managing.

Coupled with the primary functions of planning, organizing, staffing, influencing, and controlling, I have incorporated chapters focusing on management theories, connective processes, quality improvement, regulatory issues, and collective bargaining.

This eleventh edition of the book is sure to be a welcome addition to any manager’s library. In this edition, much new material has been added, but the book retains the basic concepts and the emphasis on the five managerial functions. While preparing this edition, I have attempted to respond to each of the recommendations offered by readers and text reviewers, including introducing the emerging influences chapter earlier in the text.

At the end of most chapters, readers will find additional resources with which to further study the chapter’s concepts, chapter review questions, and case studies from Ann Scheck McAlearney and Anthony R. Kovner’s 2017 text Health Services Management: A Case Study Approach. All chapters have been updated with new information. Several new concepts such as bundled payment arrangements, Katz’s 3 managerial skills, and the trilogy of management have surfaced since the tenth edition; these are introduced in chapter 1 and referenced in other chapters. New glossary terms such as artificial intelligence, bundled payment arrangements, business intelligence analyst, data analytics, emotional energy, project manager, self-managed team, and synergy have been incorporated.

New tools, exhibits, and examples have been added to several chapters. Chapter 2 includes a discussion of the preclassical theorists Robert Owens and Charles Babbage and a new section on the twenty-first-century Theory C, or the connection culture. Chapter 5 includes a discussion of the communication equation, and chapter 6 adds information on the Me Too movement along with a new section addressing the role of the compliance department. Formerly the last chapter of the book, the new chapter 7 examines the emerging influences in healthcare that speak to the many issues confronting today’s healthcare organizations and their supervisors and managers.

For chapter 8, discussion of the planning function has been expanded and includes new definitions of key terms and differentiation of strategy versus planning. The role of the business intelligence analyst and project manager in developing and implementing an organization’s plan are discussed along with the organization’s responsibility to consider social determinants of health. In this chapter, Covey’s Wildly Important Goal (WIG) and Doerr’s Objectives and Key Results (OKR) concepts are introduced and addressed.

The use of self-managed teams in healthcare is explored in chapter 12, the first of the Organizing chapters ( chapters 12–17). Chapter 15 on quality improvement underwent major revisions and has an expanded discussion of Lean Six Sigma and reengineering as well as force field analysis. Chapter 17 has added guidance on dealing with negative social media posts.

In the part on Staffing ( chapters 18–20), new information has been added in chapter 18 on the use of artificial intelligence in the recruitment process and the expansion of virtual positions and telecommuting. Chapter 20 examines the use of crowdsourcing as an appraisal tool.

The Influencing chapters ( chapters 21–25) incorporate a number of new concepts. Chapter 22 presents Sophie Bennett’s five motivational flames known as FIRED and David Sirota’s People Performance Model for enthusiastic employees. Chapter 24 features a discussion of just culture, and chapter 25 introduces Icarus Syndrome and dynamic equilibrium.

The part of the book on Controlling begins with chapter 26, an overview of the controlling function, including types of control systems and the basic managerial steps of setting standards, measuring performance, and taking corrective action. It features two new sections: the first on the controlling roles of compliance, risk management, finance, and human resources, and the second on data analytics. Chapter 27 focuses on budgeting, the most widely used form of control.

The final two chapters on Labor Relations have once again been updated by our respected and experienced labor attorney, Marc J. Leff, Esq. As one would expect from an attorney, Counselor Leff reminds us that neither chapter is intended to be a substitute for legal advice from an organization’s legal counsel.

At the time that this text was being prepared, the world was dealing with the COVID-19 pandemic. This was a time of fear, scarce resources, loss of life, layoffs, financial losses, business closures, and an economic disaster. This was a time when all supervisors, managers, directors, and executives were challenged to their maximum ability to provide care against all odds. Every leader at each level bore a critical responsibility to employ the basic concepts of planning for the unknown, organizing teams and other resources, making staffing adjustments to meet the needs of the organization, motivating and influencing staff when they have equally important family and work obligations, and controlling the outcomes.

In writing this edition, I attempted to retain the enthusiasm for effective management exhibited by Theo Haimann, the professor for whom this book is named. Theo Haimann served as the Mary Louis Professor of Management Sciences at Saint Louis University until his death in November 1991. He always incorporated current management issues into his teachings. By doing so, he was able to keep the students’ attention. This edition attempts to carry on the Haimann tradition.

While writing this edition, I experienced a serious vision condition. Frightening, yes. But the encouragement I received from clients and staff at Health Administration Press helped me complete the update. And no book is ever the product of only one person’s efforts. Many individuals contributed to this book’s development, editing, formatting, and publishing. I was fortunate to have some of the best working with me on this edition. Jeannette McClain, acquisitions editor for Health Administration Press, thoroughly reviewed the manuscript and offered many valuable suggestions. Manuscript editor Lori Meek Schuldt kept the production running smoothly. Andrew Baumann provided project management expertise, and Ben Burton created many of the instructor materials. In addition, several former and current clients of First Class Solutions allowed me to reproduce documents, policies, and other figures from their healthcare organizations. For these, I extend special thanks.

As always, I welcome your comments—good or bad—so that I can make the twelfth edition better.

Rose T. Dunn, MBA, RHIA, CPA, FACHE, FHFMA, FAHIMA

Chief Operating Officer

First Class Solutions, Inc.℠

St. Louis, Missouri

[e-mail]

Instructor Resources

This book’s Instructor Resources include PowerPoint slides for each chapter, some suggested class activities and individual student assignments in addition to those appearing in some chapters, and a test bank.

For the most up-to-date information about this book and its Instructor Resources, go to ache.org/HAP and search for the book’s order code (2431I).

This book’s Instructor Resources are available to instructors who adopt this book for use in their course. For access information, please e-mail [e-mail].

PART

I

STEPPING INTO MANAGEMENT

CHAPTER

1

THE SUPERVISOR’S JOB, ROLES, FUNCTIONS, AND AUTHORITY

Nobody can prevent you from choosing to be exceptional.

—Mark Sanborn

Chapter Objectives

After you have studied this chapter, you should be able to do the following:

Provide an overview of the rapidly changing healthcare environment and the challenges it poses for managers and supervisors.

Discuss the dimensions of the supervisor’s job.

Review the aspects of the supervisor’s position and the skills necessary to be successful in it.

Enumerate and discuss the meaning, interrelationships, and universal nature of the five managerial functions.

Discuss the concept of authority and the foundation of the formal, organizational, and positional aspects of authority.

The Healthcare Perspective

Perhaps no other industry is as complicated and convoluted in structure, process, and product as US healthcare. The need and demand for high-quality, flexible, innovative, and energetic management in all healthcare delivery settings are intensifying. The market is demanding new delivery methods that have ease of access and do not require an overnight stay. For example, in the past, patients came to the healthcare facility; now, healthcare services are conveniently located near patients’ homes and are accessible through satellite outpatient services, discount retailers, pharmacies, mobile screening units, health fairs at the grocery store, and—becoming more prevalent daily—via the webcam and your computer or smartphone. The globalization of healthcare where other countries have similar or better outcomes and a lower price tag has piqued US citizens’ interest.

Because healthcare is an ever-changing industry, the managers who work in it must be committed to adjusting workflows to respond to the changes while concurrently improving patient care. Today’s managers are challenged to effectively supervise their department operations and staffs in this decentralized and often virtual environment. Many are using technological innovations to achieve this goal, but doing so may be frustrating and require continuous training. Today’s clinicians and technicians have access to technology that is changing so rapidly that a more advanced version may be on the market before the version purchased has been installed. Other trends affecting the management of healthcare organizations include prospective, fixed, and changing reimbursement models; the cost of drugs, devices, and implants; a new generation of providers with different work expectations who are no longer working in stand-alone practices but rather in group models directly or indirectly affiliated with healthcare facilities, such as accountable care organizations; and organization mergers, closures, and ownership structures that resulted in some healthcare, pharmaceutical, and payer entities owning healthcare real estate, health-related products, and the affiliated healthcare providers.

These nuances are challenged by serving a multicultural, sophisticated, and demanding patient population that is aging with more chronic conditions, contributing to Big Data and inability to wield it, unique health conditions spawned by our mobile society, a growing behavioral health and opioid epidemic, and shortages of certain unskilled and skilled staff. Big Data refers to the extremely large data sets that organizations collect from a variety of sources (e.g., electronic health records, billing transactions, video, e-mail, laboratory or monitoring devices and equipment) that stream into the organizations’ servers in structured, semistructured, and unstructured formats and have the potential to be mined for information and used by advanced analytics applications for insights that lead to better decisions and strategic business moves. Big Data is the force behind the role of information governance, which is defined by the University of Illinois at Chicago (UIC 2020b) in healthcare as the structures, policies, and relevant procedures initiated and adhered to by hospitals, health care providers and medical insurance companies to collect, organize, utilize and secure data. Medical practice managers and nursing home administrators also are feeling the pain of reimbursement declines and the same external forces. The traditional fee-for-service and capitation arrangements have been replaced with pay-for-performance reimbursement models and incentive-driven value-based agreements.¹ However, probably the one issue that is most startling for the US consumer is the rise in health insurance premiums and consumer price index (CPI) of medical costs in proportion to the overall CPI of all costs, as reflected in the US Bureau of Labor Statistics (BLS) data presented in exhibit 1.1.

EXHIBIT 1.1 Consumer Price Index Comparison, Medical Care versus Overall Costs, January 1947 to March 2020

Source: BLS (2020a).

Finances are being affected by regulations as well. Prospective payment systems, including bundled payment arrangements, have resulted in significant cuts in reimbursement for services, compensation for capital expenditures, and teaching programs, but such systems have forced managers to thoroughly assess their processes in collaboration with their providers to improve the patient’s experience and outcome within a cost point that provides a margin of profit for the healthcare entity and its providers. Bundled payment arrangements, which are designed to pay multiple providers for coordinating the total care of a defined condition, are rooted in a population health approach where the focus is on the beneficiary’s targeted disease process or condition (e.g., pneumonia, joint replacement). Starting in 2013, Medicare’s Bundled Payments for Care Improvement (BPCI) initiative has made a single, prospectively determined bundled payment to the hospital that encompasses all services furnished by the hospital, physicians, and other practitioners for the multiple services beneficiaries receive during an episode of care. Under the BCPI initiative, organizations enter into payment arrangements that include financial and performance accountability for episodes of care. Bundled payments can align incentives for providers—hospitals, post-acute care providers, physicians, and other practitioners—allowing them to work closely together across all specialties and settings to deliver coordinated, cost-effective care to the patient. The Affordable Care Act (ACA), also referred to as healthcare reform or Obamacare, offers health insurance options for Americans who lack insurance; however, at the same time, these insurance plans also may include high deductibles, thus creating additional collection burdens for healthcare organizations. Between the cuts and changes, healthcare organizations are being forced to better manage services and streamline operations without compromising the quality of care. This is the environment you, as a new healthcare manager, are entering. Throughout this text, there will be guidance offered to help you navigate the rocky terrain ahead.

Advances in science and regulatory acceptance of technology (including robotics, artificial intelligence, and telehealth) are likely to change key inpatient and outpatient services. Insurers are channeling patients to a few hospitals to receive high-tech care—such as lung, heart, and pancreas transplants—or to outpatient diagnostic and treatment centers to receive high-tech services, including nuclear cardiac imaging and spinal surgery. Healthcare facilities and providers, in turn, are creating centers of excellence to focus limited resources on the growth of more profitable service areas and niche markets.

The National Center for Health Workforce Analysis (2017), based on projections from 2014, assessed each state’s 2030 registered nurse (RN) supply in relation to its 2030 demand and revealed both shortages and surpluses in projected RN workforce in 2030 across the United States. Projected differences between each state’s 2030 supply and demand range from a shortage of 44,500 full-time equivalents (FTEs) in California to a surplus of 53,700 FTEs in Florida. However, many nurses and nurse educators in the workforce today are from the baby boom generation and will soon be retiring. The shortage of seasoned educators is the stumbling block for many nursing schools and is causing limits on the number of new nurses graduating each year. The COVID-19 global pandemic exacerbated this problem in 2020 when it forced many educators and students to modify their practices in response to requirements for social distancing and greater online interaction; some interrupted the education process altogether to assist in treating the unprecedented influx of hospital patients. Managers will continue to be challenged with recruiting new nurses, training them, and ensuring that they are adequately supervised until they gain the skills of those seasoned veterans they replaced. Alternative staffing models that move some duties from nurses to other staff members may be considered. Sometimes called nurse extenders or certified nursing assistants, these staff members can record temperatures, pass medications, draw blood, collect specimens, and perform some patient care services, such as turning, exercising, and assisting patients when ambulating. Because nurse extenders are available in greater supply than nurses, and at hourly rates that are lower than nurses’, nurse extender staffing models may be more cost effective for organizations. Extenders have been used in other professions, including in rural areas that may have a scarcity of physicians, where nurse practitioners and physician assistants may serve as the primary care providers for many individuals. When considering alternative models, managers must be aware of unions and unionization efforts to protect a category of employees (e.g., nurses) from being replaced (e.g., by nurse extenders).

Finally, managers and supervisors will be working with a cross-generational workforce consisting of individuals ranging from those born during the baby boom years (1946–1964) through generation Z (1995–2010) and in between (Francis and Hoefel 2018). Each of these groups has unique life experiences that may affect its members’ work ethic, aspirations, and work environment preferences. New managers should remember that it is their responsibility to create an environment that will allow employees to be successful in their work and that will allow the department or the organization to achieve its goals.

In addition to these factors, many other changes from all directions are affecting healthcare delivery. Challenges such as those considered in this chapter will continue to impose constraints on healthcare services and set higher expectations.

The radical reshaping of the healthcare field calls for more and better management. Managers, from CEOs down to first-line supervisors, are needed to help implement these changes and make their organizations function effectively.

The organization is the culmination of the management process. The organization is the incubator that brings resources together to provide a service, create a product, or both. Management is the process by which healthcare organizations fulfill this responsibility. The manager is responsible for acquiring and combining the resources to accomplish the goals. As scientific, economic, competitive, social, and other pressures change, it is not the nurse or the technologist on whom the organization depends to coordinate the resources necessary to cope with the change; it is the manager. Management has emerged as a potent force in our society and has become essential to all healthcare endeavors.

Today’s health services are almost exclusively delivered in organizational settings.² Only an organizational setting can bring together the physical facilities, professional expertise, skills, information systems, technology, and myriad other supports that today’s health services delivery requires, whether these services are curative, rehabilitative, or preventive. However, the physical confines in which healthcare employees work are changing. In the past, all staff came to a physical location to work. Today, many tasks are performed remotely using the internet and high-tech hardware and software. For example, some radiology interpretations (teleradiology) and some physician evaluation services (telemedicine) are handled long-distance or through robots, while non–patient care functions—such as billing, information systems, transcription, and coding—may be housed in facilities that are not on the same campus as the hospital, performed by staffs offshore or from their homes, or may be outsourced to a vendor serving more than one organization. Those involved in the delivery of healthcare services and those managing the remote functions must understand the complexities of organizational life (behavior, development, and culture) and the importance of expert administration.

Because the delivery of healthcare largely means providing a service that is by nature people-intensive, approximately 59 percent of the operating revenues in the field are consumed by wages and benefits (LaPointe 2018). Therefore, it is not surprising that employee productivity is often scrutinized and leaders are increasingly interested in outsourcing services. Many experts believe the United States needs better administration throughout the healthcare industry. Frontline management—departmental supervisors, regardless of titles and nature of work—is responsible for the department functioning smoothly and efficiently. It is essential, therefore, that effective supervisors are developed in all areas of the healthcare field.

The Demands of the Supervisory Position

The supervisory position within any administrative structure is difficult and demanding. You probably know this from your own experience or by observing supervisors in the healthcare organizations in which you work. The supervisor, whether a manager of printing and mail services or a chief technologist in the clinical laboratory, can be viewed as the person in the middle of a pyramid structure. The supervisor serves as the principal link between higher administration (the top of the pyramid shown in exhibit 1.2) and the employees (the base of the pyramid).

EXHIBIT 1.2 The Administrative Pyramid

The job of almost any supervisor, regardless of whom or what this middle manager supervises, involves four major dimensions, or four areas of responsibility.

First, the supervisor must be a good boss, a good manager, and a team leader of the employees in the unit. This includes having the technical, professional, and clinical competence to run the department smoothly and see that the employees carry out their assignments successfully.

Second, the supervisor must be a competent subordinate to the next higher manager: In most instances, this person is an administrator, a center executive, or a director of a service. Ultimately, the supervisor’s boss reports to the chief executive, owners of the organization, or the board of directors or trustees.

Third, the supervisor must link the administration and the employees. For example, employees such as laboratory scientists, ultrasound technicians, and clerical support staff see their supervisor—who is perhaps the chief technologist—as the administration. The employees communicate their concerns to the administration through the supervisor, and the supervisor communicates the goals and policies established by senior administration. The supervisor filters the employees’ concerns into categories (i.e., those that the supervisor should address, those that the supervisor’s boss should address, and those that should be pushed further up the ladder and may represent concerns shared by employees outside of the department). Similarly, the supervisor receives information from multiple levels in the hierarchy and decides which information should be passed on to immediate subordinates and to those working on the front line. Goal and policy communications must be shared with all staff because the supervisor must make certain the work gets done to achieve those goals.

Fourth, the supervisor must maintain satisfactory working relationships with the directors, leaders, and peer supervisors of all other departments and services. The supervisor must foster a collegial relationship and coordinate the department’s efforts with those of other departments to reach the overall objectives and goals of the institution. The supervisor must help the organization provide the best possible service and patient care regardless of which department or service gets credit.

The four dimensions of the supervisor’s job are shown in exhibit 1.3. The supervisor must succeed in vertical relationships downward with subordinates and upward with direct superiors. In addition, especially in project and ad hoc team activities, the supervisor must skillfully handle horizontal and vertical relationships with other supervisors, staff members, and superiors.

EXHIBIT 1.3 Four Dimensions of the Supervisor’s Job

Henry Mintzberg (1973, 55–58) depicts these dimensions as roles common to the work of all managers. A role is an organized set of behaviors, and Mintzberg categorizes the roles into three groups: interpersonal, informational, and decisional ( exhibit 1.4).

EXHIBIT 1.4 Henry Mintzberg’s Managerial Roles

Source: Courtesy of Henry Mintzberg from his 1989 book Mintzberg on Management: Inside Our Strange World of Organizations.

The interpersonal role, such as relationships with one’s staff and other supervisors, links all managerial work. This role group includes serving as a leader and liaison and maintaining effective communication with peers, subordinates, superiors, and individuals outside the organization. Maintaining positive relations with one’s peers may be particularly challenging when each of them is competing for the same pool of the organization’s limited resources.

The informational role ensures that information received is processed. In this capacity the manager collects information during monitoring activities, filters information received from others, and displays and disseminates information to others. Your work as a monitor deals with the search for and collection of information that is of value to your team, organization, or possibly community (OppiaMobile 2019). Further amplification of this task is given in Peter Drucker’s book Management, wherein the author suggests that you must ask yourself what information you need to do your job and where you will find it (Drucker 2008). The disseminator aspect of the informational role entails passing on relevant information to those who have a need to know. Related questions are what information you owe others and what they owe you (Rosenstein 2008). The dissemination process may be written or oral, formal or informal. Occasionally, you may be asked to serve as a spokesperson, which involves the dissemination of information to others outside your department or organization or on behalf of a group of your peers, such as reporting the results of an ad hoc committee.

The decisional role makes use of the processed information for decision making. In this area the manager or supervisor may implement change based on the information received or collected. Doing so allows the manager to act in an entrepreneurial manner, according to Mintzberg. Alternatively, the information could be used as an alert to recognize when corrective action is necessary, when the organization may be threatened, when employees are disgruntled, or when work disruption may be imminent. In this situation, the role being played, according to Mintzberg, is one of disturbance handler. The final two aspects of the decisional role include resource allocation and negotiation. In both of these tasks, the manager is using information to prioritize the use of resources, determine where resources can be best utilized, and figure out how to most economically and effectively obtain and use these resources.

Managerial roles can be further defined as the types of skills necessary for successful managers. Roles are how managers navigate the organizational structure. These roles define managerial capabilities that are both internal and external to the organization (Elkins 2019). Because of the complexity of these relationships, the role of the first-line supervisor in any organization is commonly acknowledged to be the most difficult. It is even more difficult for supervisors within the healthcare field because their actions are directed by not only their immediate supervisor but in some instances also medical staff members. In addition to their many professional obligations, healthcare supervisors must always bear in mind the needs and desires of patients and their relatives, who may be physically drained and emotionally upset. Thus, supervisors need to keep informed of any concerns of their own staff, the medical staff, and patients. All these multifaceted considerations make the job of the healthcare supervisor stimulating but demanding.

For example, consider the long list of demands made on a charge nurse of a nursing unit. The charge nurse’s duty is to provide for and supervise the nursing care rendered to the patients in the unit. She delegates some of her authority for the care of patients and the supervision of personnel to subordinate nursing team leaders, but she still must plan, direct, and control all activities within the nursing unit. She must make the rounds with medical and nursing staff. She also makes rounds to personally observe the safety, condition, and behavior of patients and to assess the need for and quality of nursing care. She may even have to assume general nursing functions in the care of patients who have complex problems or when vacancies exist.

Furthermore, the charge nurse must interpret and apply the policies, procedures, rules, and regulations of the facility in general and of nursing services in particular. She must provide around-the-clock coverage of the unit by scheduling staff properly at all times. She is to communicate and report to her immediate patient care services superior all pertinent information regarding patients in her unit. She must orient new personnel to the unit and acquaint them with the general philosophies of the institution. She is responsible for continued in-service education in her unit, teaching personnel new patient care techniques and patient safety initiatives. She also participates in the evaluation of her subordinates.

In addition, part of the charge nurse’s job is to coordinate her patient care with the care and therapeutic procedures of the various departments throughout the institution. Furthermore, she is involved in the design and regular reevaluation of the budget. She serves on a number of committees, in addition to attending all patient care management meetings. She may also be expected to help in the supervision and instruction of student nurses and medical residents when necessary. Many additional duties are often assigned to a charge nurse, depending on what the particular healthcare facility specifies in its description of this demanding position.

Although it is difficult, if not impossible, to forecast when and how a new scientific or technological event will affect the supervisory position, all supervisors must keep abreast of changes affecting their profession. It is important that supervisors prepare themselves and their employees professionally, scientifically, technologically, and psychologically for changes that occur in the delivery of healthcare.

In addition to the medical and scientific breakthroughs, business intelligence applications, increased automation, and their concomitant benefits and challenges will continue to affect all supervisors. Use of electronic health records and wireless handheld units, such as tablets and smartphones, has continued to expand. For clinicians, wherever there is connectivity to the web and cloud-based applications, patients can be monitored in real time, often through the clinician’s cell phone (Topol 2011). Supervisors and their staffs have to be familiar with these technologies. While the infusion of technology into our day-to-day activities facilitates access to information instantaneously, which helps us treat patients and do our jobs more efficiently, it also provides an avenue for misuse. Supervisors, therefore, must be attentive to the time that subordinates spend on the internet and their cell phones, as valuable work time can be wasted. Additionally, concerns over privacy have heightened with inconspicuous cell phone camera and video capability.

With a growing, high-tech society and patient population, increasing demands for more sophisticated and better healthcare and information and results about their care, the job of any supervisor in the field is likely to become even more taxing. This is true whether the supervisor’s title is health information manager, operating room supervisor, decision support analyst, plant operations foreman, or food service supervisor. The one factor that helps supervisors cope with all of this responsibility is the continued advancement of their knowledge and skill in the managerial part of the job.

This supervisory position is usually the first in a long career of administrative positions that require increasingly advanced management skills. For instance, a programmer analyst or software engineer may begin the ascent into management as an applications manager. After serving in this capacity for some time, the manager is promoted to network administrator, then to information technology director, and eventually to the organization’s vice president or chief technology officer.

One may also move up the ladder in a less traditional way. For example, consider the staff nurse selected to manage the preregistration and scheduling activities. After serving successfully in this capacity for some time and establishing good relations with a managed care company, the staff nurse is recruited by a managed care organization to oversee the precertification unit and is given the title of precertification manager. This manager is then promoted to director of benefit determinations and eventually to assistant vice president for customer service and medical management.

Most of the tens of thousands of managerial positions in healthcare today are filled by healthcare professionals who have not had any formal administrative training or studies in management or leadership. Therefore, it is essential that the supervisor, department head, or leader learn as much as possible about being a competent first-line manager because that position is likely the first step in the climb up the managerial and administrative ladder.

The Managerial Aspects of the Supervisory Position

The job of a supervisor can be viewed in terms of three essential skills (Katz 1974). First, good supervisors must possess technical skills to ensure that they understand the clinical and technical aspects of the work to be done. Second, supervisors must possess human relations skills, which concern selecting the right people for the jobs, working with and motivating people, and understanding individual and group feelings. Third, supervisors need conceptual skills, which enable them to visualize the big picture and to understand how all parts of the organization contribute and coordinate their efforts. Katz’s three skills are illustrated in exhibit 1.5. The relative degree of importance of all three skills depends on the level of the position within an organization. Generally, those in first-line management need a greater proportion of technical skills, while those in top management will draw on a higher proportion of conceptual skills in their work; those in middle management need a fairly even distribution of the three skills. However, all levels of management require all these skills at one time or another.

EXHIBIT 1.5 Katz’s Three Skills

Source: Courtesy of Sutevski Consulting, CEO Dragan Sutevski, PhD.

More recently, other authors have proposed leadership competencies that use the Katz skills as a foundation. Perra (2001) recommended an integrated leadership model promoting staff participation whereby the leader’s characteristics included shared vision, participation, communication, and the ability to facilitate change. Contino (2004) identified organizational management, communication, strategic planning, and creative skills as key competencies. Finally, Longest (1998) listed conceptual, technical, interpersonal, and political skills. Each of these authors also identified other skills, but there continues to be a correlation today with those skills Katz defined more than four decades ago.

Let us consider how the skills and roles we have been discussing may apply to the performance of two supervisors. John, a supervisor at Hometown Hospital, often appears harassed, disorganized, and overly involved in doing the job at hand; he muddles through his day and is constantly knee-deep in work. He puts in long hours and never fears doing anything himself. He works exceedingly hard but never seems to have enough time left to actually supervise. Jane, a supervisor at Upstate Hospital, is on top of the job, and her department functions in a smooth and orderly fashion. She finds time to sit at her desk at least part of each day, review professional journals, respond to e-mails in a timely fashion, and keep her desk work up-to-date. Why is there such a difference between John and Jane?

Some supervisors are more capable or proficient than others. If you compare John and Jane to discover why Jane is on top of her job and John is constantly fixing things himself, you will probably find that Jane understands her job better and has developed subordinate staff to whom she can safely delegate assignments. Assume that both are equally good professionals, both have graduated from reputable health administration programs in the same community and have similar staffing ratios and technology available, and the conditions under which they perform are similar. Jane’s results are significantly better than John’s because she is simply a better manager. She is able to supervise the functions of her department in a manner that allows her to get the job done through and with the people of her department. The difference between a good supervisor and a poor supervisor, assuming everything else is equal, is the difference in each person’s managerial abilities.

However, the managerial aspect of the supervisor’s position has long been neglected. Instead, the emphasis has been placed on clinical and technical competence. Many new managers are appointed from the ranks of one of the various professional, clinical, or technical services or trades. As a result of their ingenuity, initiative, and personal drive, they are promoted to the supervisory level and are expected to assume the responsibilities of managing the unit. Little is probably done, however, to acquaint them with these responsibilities or to help them cope with the managerial aspects of the new job. More or less overnight, they are made a part of administration without having been prepared to be a manager. These new managers are oriented by their predecessors, and they learn more from other managers, but some problems are likely. These may be dealt with by a better understanding of the supervisory aspects of the job so that the managers are running the department instead of the department running them.

The aim of this book is to teach individuals to be successful healthcare managers. This does not mean that one can neglect or underestimate the actual work involved in getting the job done. Often, the supervisor is the most skilled individual in the department and can do a more efficient and quicker job than anyone else. The supervisor must not be tempted, however, to step in and take over the job, except for purposes of instruction, during extended vacancies, or in case of an emergency. Rather, the supervisor’s responsibility is to ensure adequate staffing of employees who can do the job properly. As a manager, the supervisor must plan, guide, and supervise.

The Meaning of Management

The term management has been defined in many ways. A meaningful definition for our purposes is the process of getting things done through and with people by directing and motivating the efforts of individuals toward common objectives. You have undoubtedly learned from your own experience that in most endeavors one person alone can accomplish relatively little. For this reason, people have found it expedient and even necessary to join with others to attain the goals of an enterprise. In every organized activity, the manager’s function is to achieve the goals of the enterprise with the help of subordinates, peers, and superiors.

Achieving goals through and with people is only one aspect of the manager’s job, however; creating a working atmosphere—that is, a climate or a culture in which subordinates can find as much satisfaction of their needs as possible—is also necessary. In other words, a supervisor must provide an environment conducive for the employees to fulfill such needs as recognition, achievement, and companionship. If these needs can be met on the job, employees are more likely to strive willingly and enthusiastically toward the achievement of departmental objectives as well as the overall objectives of the institution. Thus, we must add to our earlier definition of management: The manager’s job is getting things done through and with people by enabling them to find as much satisfaction of their needs as possible and by motivating them to achieve both their own objectives and the objectives of the institution. The better the supervisor performs these duties, the better the departmental results will be.

You may have noticed by this time that the terms supervisor, manager, and administrator have been used interchangeably. The exact meaning of these titles varies with different institutions, but the terms administrator and executive are generally used for top-level management positions, and manager, leader, director, and supervisor usually connote positions within the middle or lower levels of the institutional hierarchy. Some theoretical differences may be considered, but for the purposes of this book, these terms are used interchangeably. Furthermore, the use of gendered terms—he or she, him or her, his or hers—is not meant to exclude anyone of a gender other than the one used in that instance.

As you read this book, you will discover that the managerial aspects of all supervisory jobs are the same in all industries. This is true regardless of the supervisor’s department, section, or level within the administrative hierarchy. Thus, the managerial content of a supervisory position is the same whether the position is director of case management, head of environmental services, chief engineer in the maintenance department, or marketing director. By the same token, the managerial functions are the same for the first-line supervisor, midlevel manager, or top administrator. In addition, the type of organization in which you work does not matter; managerial functions are the same for a commercial or industrial enterprise, not-for-profit or for-profit organization, professional association, government agency, manufacturing facility, and hospital or other healthcare facility. Regardless of the activities of the organization, department, or level, the managerial aspects and skills are the same. The difference is in the extent to which or frequency at which a supervisor performs each of the tasks.

As supervisors advance up the administrative ladder, they will rely less on professional and technical skills and more on conceptual skills. Therefore, top-level executives generally use far fewer technical skills than those who are employed under them. In their rise to the top, however, administrators have had to acquire all the administrative skills necessary for the management of the entire enterprise.

Consider the following real-life example; the real name of this supervisor has been disguised. Ray Andrews, who had been an English major in college, taught junior high school. When his teaching salary became inadequate to support his growing family, Ray joined an insurance company as a claims adjudicator (a base-level position). He noticed abnormalities in some claims from some providers and researched these for his superior. Eventually he was promoted to the fraud investigations unit and ultimately directed that operation until he was promoted to oversee all claims and investigations functions. Ray interacted well with physicians and insurance representatives alike. As he gained more experience, he began negotiating arrangements with physician groups and hospitals for preferred provider organizations (PPOs) and health maintenance organizations (HMOs). He was selected to be CEO of a national insurance company and was very successful. At each step of his advancement, Ray built on prior experience and knowledge, but he did not need to personally perform all activities to ensure the success of the insurance company. He left the details to his proficient subordinates.

Similarly, the CEO of a healthcare system is concerned primarily with the overall management of hospitals and affiliated clinics, diagnostic centers, and other entities within the system. The CEO’s functions are almost purely administrative. In this endeavor, the chief executive depends on the administrative, managerial, and technical skills of the various subordinate administrators and managers, including all the first-line supervisors, to get the job done. The CEO, in turn, uses managerial skills in directing the efforts of all these subordinate executives toward the common objectives of the hospital.

How does a supervisor acquire these important managerial skills? First, supervisors must understand that standard managerial skills can be learned. Although good managers, like good athletes, are often assumed to be born, not made, this belief is not based in fact. We cannot deny that people are born with different physiological and biological potential and that they are endowed with differing amounts of intelligence and vary in terms of many other characteristics; a person who is not a natural athlete is not likely to run 100 yards in record time. Many individuals who are natural athletes, however, have not come close to that goal either.

A good athlete is made when a person with some natural endowment develops it into a mature skill by practice, learning, effort, sacrifice, and experience. The same holds true for a good manager; by practice, learning, and experience, the manager develops this natural endowment of intelligence and leadership into mature management skills. One can learn and practice the skills involved in managing as readily as the skills involved in playing tennis.

If you are an advanced student of healthcare management, or you currently hold a team leader or supervisory position, you likely have the necessary prerequisites of intelligence and leadership and are now ready to acquire the skills of a manager. Developing these skills takes time and effort; they are not acquired overnight.

The most valuable resource of any organization is the people who work there, or the human resources. The first-line supervisor is the person to whom this most important resource is entrusted in the daily working situation. The best use of an organization’s human assets depends greatly on the managerial ability and understanding of the supervisor, as manifested by this individual’s expertise in influencing and directing them. The supervisor’s job is to create a climate of motivation, satisfaction, leadership, and continuous further self-development and self-improvement. This is a challenge to every supervisor because it means the supervisor must also continue to develop as a manager.

Managerial Functions and Authority

The supervisor’s managerial role rests on two foundations: managerial functions and managerial authority. This section addresses each of these key concepts in turn.

Managerial Functions

Managerial functions are the activities that must be performed by a supervisor to be considered a true manager. Five managerial functions are described in this book: planning, organizing, staffing, influencing, and controlling the resources of the organization. The resources include people, positions, technology, physical plant or work environment, equipment, materials, supplies, information, and money. (The labels used to describe managerial functions vary somewhat in management literature; some textbooks list one more or one fewer managerial function. Regardless of the terms or number used, the managerial functions are interrelated and goal driven and constitute one of the two major characteristics of a manager.) A person who does not perform these