This document discusses organizational structure and strategic management. It defines key concepts related to organizational structure like structure, organizational forms, and organizational charts. It also discusses the influence of hierarchy and the advantages and disadvantages of tall vs flat organizational structures. For strategic management, it outlines the six components of the strategic planning process as creating a mission/vision, assessing the environment through a SWOT analysis, setting objectives, developing implementation strategies, planning implementation, and planning evaluation.

1. Chapter 12
Organizational Structure

2. Definitions
 Structure refers to the arrangement of the parts
within a larger whole. In Donabedian’s (1980)
classic quality framework of structure, process,
and outcomes, structure affects process, which
affects outcomes. Organizations are entities that
contain groupings that consolidate smaller
elements into a larger, systematized whole.
Organizational social structure is defined as the
ways in which work is divided and coordinated
among members and the resulting network of
relationships, roles, and work groups (e.g., units,
departments).

3. Key Organizational Design Concepts
 The structure of an organization can be described
as the overall way work is divided into tasks and
roles, grouped into subunits, and coordinated across
an organization.
 Leaders need to address key elements when they
design an organizational structure: centralization
and decentralization, coordination or integration,
hierarchy (chain of command), span of control,
coordination (integration), centralization and
decentralization.

4.  Centralization and decentralization: The degree to
which decision-making is concentrated at a single
point in the organization versus the degree to which
decisions are made by lower-level employees.
 Coordination or integration: The coordination of
activities through accountability, rules, and
procedures, roles, committees, task forces, cross-
functional teams, or direct communication

5.  Hierarchy (or chain of command): The structure
of authority in an organization The chain of
command is an unbroken line of authority that
extends from the top of the organization to the
lowest level and clarifies who reports to whom
 Size: Number of employees in the organization
 Span of control: The number of subordinates a
manager can efficiently and effectively direct

6. Hierarchy
 Hierarchy also enables organizations to assign
responsibilities based on the complexity and skill
requirements of the work and to ensure individual
accountability.
 Responsibility is the obligation to take on and
accomplish work and to secure the desired
results.
 A manager assigns or delegates responsibility to
a subordinate, and thus responsibility flows down
the organizational chain.

7. Hierarchy
 In accepting the obligation of an assigned task, the
staff person is accepting responsibility to accomplish
the task, whereas accountability is the liability for task
performance and is determined in a retrospective
analysis of what occurred.
 The assignment of responsibility and the granting of
authority create accountability. Accountability flows
upward or outward, from staff to manager or from
provider to client.
 Hierarchy creates formal lines of communication
 Hierarchy delineates roles and responsibilities

8. Organizational Forms
 1.Functional: dividing the work by occupation
leads to a functional organization. Examples are
nursing, respiratory therapy, admitting, and
environmental services.
 2.Program: program organizations emphasize
integration of the work by consumer, service, or
geography. In health care, programs may be
managed according to consumer health needs
(e.g., diabetes, cancer), consumer age (e.g.,
elderly, neonates, women), services (e.g.,
addictions, rehabilitation),

9. Organizational Charts
 Hierarchy reflects the formal structure of the
organization, which can be identified on an
organizational chart.
 An organizational chart is a visual display of the
organization’s positions and the intentional
relationships among positions.
 Staff positions or advisory bodies may be depicted
on the chart with dotted lines to show consultative
relationships.
 Informal structures do not appear on an
organizational chart

10. Organizational Shapes
1. Flat organization structures 2. Tall organization
structures
Advantages of Tall Organization
1. Increased access to managers and
organizational resources
2. Greater supervisory capability
3. Layers of skill to deal with varying degrees of
work complexity
4. Layers of responsibility to address short, medium,
and long-term issues and planning

11. Simplified tall organizational
structure

12. Disadvantages of tall
organization
 More hierarchical centralization; potential to
micromanage staff activities
 Slowed vertical decision-making and distorted
communication
 Less innovation
 Difficult way-finding for consumers
 Greater cross coordination required
 Costly management infrastructure

13. Advantages of flat organization
1. Fewer divisions facilitate streamlining of
goals, problem-solving, and resource use
2. Greater hierarchical decentralization; potential
for greater staff autonomy through increased
delegation
3. Greater innovation
4. Enhanced responsiveness to consumers at
point of service
5. Less cross-coordination required

14. Simplified flat organizational
structure.

15. Disadvantages of flat
organization
 Decreased access to managers and
organizational resources
 Decreased supervisory capability
 Overextension of managers
 Vertical communication delays

16. Question #1
All of the following influence the shape of the
organization except:
A. Formal reporting relationship
B. Span of control of managers
C. Informal and formal power structures
D. Number of management layers

17. Chapter 14
Strategic Management

18. Definitions
 The concept of strategic management includes strategic
planning and strategy implementation.
 Additional terms associated with an organization’s use of
strategy include organizational mission and vision, core
values, core purpose, strategy, tactics, strategic plan,
objectives, and stakeholders.
 The organizational mission and vision collectively is a
guiding framework that describes the organization’s
purpose and future direction
 Core values define the characteristics or beliefs that
underlie the organization’s activities.
 A strategic plan is a document that specifies a plan for
actualizing the mission.

19. Strategic Planning Process have
6 components:
1. Creating strategic mission and vision
2. Assessing the environment
3. Setting objectives
4. Developing strategies to achieve the objectives
5. Planning for implementation
6. Planning for evaluation

20. 1.Creating strategic mission and
vision
 The first step of the strategic planning
process is to formulate or review and update
as needed the organization’s mission and
vision in alignment with the organization’s
core purpose and values. The mission
delineates what the organization does, while
the vision articulates the preferred future
state of the organization

21. 2. Assessing the Environment
 A key component of the strategic planning process is
to assess the environment. This assessment, called
environmental scanning, consists of analyzing both
internal and external environmental factors. A SWOT
analysis is often used in the environmental
assessment and reviews four key areas:
 SWOT
 Strengths
 Weaknesses
 Opportunities
 Threats

22. 3. Setting Objectives
 Defines the who, what, and where of the
strategies to be implemented
 Identifies where the organization is, where it
wants to go, and how long it will take to get there
 Objectives may be written in terms of financial
outcomes that relate to improvements in an
organization’s fiscal health and result in a
stronger position for the institution in the
industry.

23. 4. Developing Implementation
Strategies
 Strategies must be:
 Aligned with organizational culture
 Realistic
 Planned
 Intentional
 Flexible

24. 5. Planning for Implementation
 Strategies must be implemented:
 Proficiently
 Efficiently
 In a timely manner

25. Implementing Strategy
 Implementing strategy is closely linked to
organization’s operations and involves:
 Managing
 Budgeting
 Motivating
 Changing culture
 Supervising
 Leading

26. 6. Planning for Evaluation
 Determines if strategic plan has been achieved
 If strategy is not successful, further evaluation
(SWOT analysis) is needed

27. Question #1
All of the following are true about strategic
management except:
A. It involves establishing goals and setting targets.
B. It allows an organization to obtain and maintain a
competitive advantage.
C. It includes only financial goals.
D. It requires implementation and evaluation.

28. Question #2
The statement “As a member of a progressive health
care system, we deliver high-quality comprehensive
services to the local and extended community with
excellence, compassion, and competence” is an
example of which part of a strategic plan document?
A. Executive summary
B. Background
C. Mission
D. Goals and strategies