Conflict Resolution at General Hospital, Term Paper Example

During the 1980’s, approximately 90 percent of General Hospital’s beds used to be occupied but the emergence of a state-of-the-art medical center has significantly reduced its business as well as revenues. It had to eliminate certain services and while its income from private health insurance plans decreased, its share of revenue from less profitable Medicare and Medicaid patients increased. General Hospital’s CEO Mike Hammer realized that the hospital’s long term survival was in jeopardy unless drastic measures are taken. From his experience as healthcare executive, Mr. Hammer knew that both costs needed to be lowered and revenues needed to be increased so that General Hospital could add more promising and lucrative services in order to become more competitive. In the end, Mr. Hammer decided that he could achieve his objective through lowering costs only.

Mr. Hammer believed that physicians were a big hurdle in the way of cutting costs because they didn’t take the effort to understand the operations of the management and were resistant to any cost cutting measures. Mr. Hammer had failed twice in his efforts to negotiate with physicians but he was convinced that the matter has to be addressed somehow. Thus, Mr. Hammer gave free hand to newly hired hospital administrator, Marge Harding to proceed with cost cutting measures. Ms. Harding’s first step was to replace manual electrodiagram (EKG) interpretation with a computerized EKG interpretation system that had already become the norm in the industry. Ms. Harding estimated that the move will save hospital at least $100,000 for the next three years. Ms. Harding didn’t replace the old system because it was not working. In fact, manual EKG interpretation was the job of Dr. James Boyer who was not only punctual but had consistently performed well in his assigned roles.

But the transition didn’t go as expected and the new system soon ran into problems. Some EKG interpretations would arrive late and some not at all. Sometimes, EKG interpretations of a different patient would be sent to the physicians. These errors accounted for 25% of all EKG cases. The physicians revolted and Director of Medicine, Dr. Mark Williams demanded the reinstatement of the old manual EKG interpretation system. So far, Ms. Harding is resisting Dr. Williams’ demand and has made it clear that the new system will stay in place. Thus, the main conflict is that the physicians want to preserve the old culture to which they have become used to while the management wants to run the hospital more as a competitive commercial organization with profit maximization as the primary objective.

In the past, Mr. Hammer tried to adopt ‘compromising’(Wright State University) as a conflict management strategy but it failed. Mr. Hammer wanted to convince Dr. Williams to persuade the physicians to eliminate wasteful actions where possible. But Dr. Williams was not convinced since he thought culture is unchangeable and any attempt to change it would drive away talented physicians. Based on his past experience, Mr. Hammer is now convinced that force is the only way which is why he has given Ms. Harding a free hand to cut costs however she sees fit. Ms. Harding has adopted ‘forcing’ as a conflict management strategy as she issued orders to the EKG department to use the system. She didn’t seek any input nor did she try to find out about the physicians or the EKG department’s concerns. She installed the system and expected everyone to adopt it without questioning her rationale. Even as the new system ran into problems, she ignored objections and has made it clear that the new system will remain in place.

General Hospital could have used action teams to address the cost reductions to stay competitive. Action teams are created to solve a particular problem. Action teams strive to come up with various solutions and then try to implement the best ones (Mautner, 2006). The action team at General Hospital may include members from various departments such as finance, operations, and physicians. The diversified composition of the team will not only ensure that the different groups are able to understand each others’ concerns as well as explain their own ideas but the solutions reached by the team will also have a greater prospect of being embraced by everyone. This is because every department will feel their concerns have been listened to and incorporated into the selected solution.

Mr. Hammer can adopt collaborating negotiation style to get buy-in for the cost reductions. Physicians as well as Dr. Williams do not have much business background and operations experience thus, it is Mr. Hammer’s job to educate them that cost reductions are not only necessary for profitability but will also help save physicians’ jobs. Mr. Hammer knows that unless costs are controlled, hospital’s very survival may be threatened in the future. Mr. Hammer would also listen to physicians’ concerns and try to figure out how their concerns can be met while reducing costs at the same time. Unless Mr. Hammer may also tie part of compensation bonus with the cost reductions achieved by the physicians. The hospital needs both the talented team of physicians as well as a capable management to ensure long term profitability and survival of the organization. Thus, collaborating negotiation style is best suited to Mr. Hammer because it aims for win-win situation for both parties (Coburn).

Both the management and the talented physicians are essential to the long term success of General Hospital. Thus, Hammer should not allow forced decisions like Ms. Harding’s computerized EKG interpretation system. This is because even if the management makes the right decisions, the decisions will fail to achieve their objectives because not everyone will be committed to it. In fact, some people may even want the forced decisions to fail so that the management is not further encouraged. Any decision should have commitment from all parties which is why Mr. Hammer should go for democratic leadership style(Kendra). He should involve everyone in decision making process, listen to their concerns, and make sure that he accepts those ideas that can be incorporated into the solution with little or no costs.

Mr. Hammer should encourage physicians to come up with ideas to cut costs and award them bonus for ideas that may be implemented. It is possible that there are other ways of cutting costs that may be escaping the management. In addition, Mr. Hammer should do a comprehensive study of the whole organization to identify different cost drivers instead of just focusing on physicians’ salaries. This will tell physicians that Mr. Hammer is not exclusively targeting them and they will feel less threatened.  Mr. Hammer may also take salary cut as well as encourage everyone in the management to do so in order to set an example for the physicians.

Mr. Hammer may also hire outside consultants who have industry experience and who can bring valuable insight into the operational efficiency secrets of other successful hospitals. The consultants may also be seen as a neutral party which is an added benefit. In short, General Hospital’s long term profitability and long term survival depends on everyone working together because both the management and the physicians are indispensable to the competitiveness of the organization.

References

Coburn, C. (n.d.). Negotiation Conflict Styles. Retrieved August 15, 2011, from http://www.negotiations.com/articles/negotiation-conflict-profiles/

Kendra, C. (n.d.). Lewin’s Leadership Styles. Retrieved August 15, 2011, from http://psychology.about.com/od/leadership/a/leadstyles.htm

Mautner, J. (2006, November 14). The Right Way to Solve Problems. Retrieved August 14, 2011, from Entrepreneur: http://www.entrepreneur.com/management/operations/article170478.html

Wright State University. (n.d.). Conflict Management–Style and Strategy. Retrieved August 14, 2011, from http://www.wright.edu/~scott.williams/LeaderLetter/conflict.htm