Improving Healthcare Management at the Top

Sharon Roberts, Milan Frankl

• Publisher: Business Expert Press
• Year: 2015
• ISBN:
  9781631572616
• Topic: Business
• Subtopic: Industria dei servizi
• Index: Business

In this book the authors explore the influence of gender on organizational performance in the health care sector. They argue that gender diversity of boards improves health care organizational performance when compared to homogeneous boards. The theoretical framework used was developed from conducting literature reviews of scholarly academic journal articles on gender, boards, and organizational performance as well as performing an in depth study of the performance of health care organizations in Ontario, Canada. Research results suggest that effective boards and their composition were dependent on their female to male ratio to realize administrative efficiencies. Publicly funded, nonprofit, 126 acute care hospitals located in Ontario, Canada, were chosen as the health care sector for this research. Limitations of this study are in the complexity of the health care industry, competing internal and external priorities, and funding constraints. Nevertheless, this book is original work and relevant for use by boards to examine the complementary mix of gender as a predictor of organizational performance.

CHAPTER 1

Gender diversity may be the answer to performance

In Chapter 1, we argue that gender diversity may be the answer to improving organizational performance. We further argue that gender diversity on corporation’s boards (especially in health care organizations) has a direct link to performance.

Breaking the gender barrier of all-male boards continues to be a topic of interest in the media and government. With so many women in management advancing their educational qualifications, research across industries and countries show a low representation of women in top decision-making roles. Although an obvious lack of women corporate directors in Canada is prevalent, 50 percent of the workforce consists of women making decisions on the frontline.

1.1 Significance of this book

Industry studies on upper echelons are primarily related to high-tech, computer, banking, electronics, semiconductor, furniture, finance, food, and airline industries. However, many studies limit their initial sample to a specific industry situation such as the type of investments involved.

We develop an awareness of the prevalence of male boards in Ontario hospitals and its consequence. Furthermore, we strive to provide information that could create new management processes, thus improving organizational survival of the Ontario health care sector.

Our findings are not unique to country or industry because underrepresentation of women in the upper echelons of many organizations is affecting global economies. The intellectual segregation is preferential tendency toward men accessing leadership roles.

We provide evidence that improved organizational performance in hospitals located in Ontario, Canada, is the consequence of gender diversity on boards.

Use of this information could benefit top management future appointments to the upper echelons in health care. However, the debate on the lack of female representation on health care boards has attracted more journal articles since Hambrick and Mason’s Upper Echelons Theory (UET) research in 1984. To date, more than 140 publications and 37 articles on female board appointments have followed since this first publication.

In addition, this information might benefit human resources in forecasting the hiring of board members, improving succession planning, and ensuring talented management.

The government could use the predictive model generated from data analysis of organizational performance to forecast allocation of resources in Ontario hospitals.

However, research specific to diversity, gender, and hospitals is limited, which makes this book the first to illustrate the link between gender diversity of boards and organizational performance in hospitals.

The benefit to the health care system is to bring purposefully gender diversity to hospital boards in Ontario. Further, organizational survival in a changing health care environment could be affected by engaging a dialog in response to the negligible change in hospital performance during the period of 2007 to 2011.

1.2 Connecting the dots

In the health care sector accountability, hospital performance is subject to a range of factors like service, quality, and efficiency of delivery. With the regulatory standardization of patient care practices, the stability in hospital performance does not imply only efficiency in the provision of services. Management researchers have viewed successful upper echelons or top management teams (TMTs) as multidisciplinary, heterogeneous, and diverse.

For consistency, upper echelons explored in this book are at the board level. The board is identified as the strategic decision-making team comprised of the upper echelons in organizations. Nonvoting members of the board are included as board members if identified on hospital board listings as contributors to the strategic decision-making process. The diversity of opinion, knowledge, and background allows a thorough discussion of performance potential, which helps minimize groupthink, reduce individual influence of team members, restrict the generation gap, and encourage assessment of alternatives.

Members of the Canadian government are considering legislating corporate boards by requiring them to appoint more female members, similar to the practice now in place in several European countries.

In 2014, the gender diversity of 126 acute care hospital boards in Ontario, Canada, comprised 60 percent males. Some hospital boards had all-male members or had at least three female members, but no board was comprised of all-female members.

In the health care industry, the cost of provisioning quality patient care continues to increase. A distinctive niche exists in health care for unified leadership because of the industry’s size, complexity, differing incentives, and scarcity of resources. Administrative inefficiencies persist in the health care industry. As it relates to hospital board composition and organizational performance, a connection exists with the diversity of the board in decision making to the efficient management of hospital expenses. Managing hospital costs in a time of change, reduced funding, and rising health care costs demands a new model of corporate governance and board composition.

The main sources of data we used are from the Canadian Institute of Health Information (CIHI), and Canadian hospital websites. The sources are reliable secondary sources, therefore reducing biases by not attempting to combine primary and secondary data.

Further, organizational performance is determined by efficiency as a quality measure of health care, indicating hospital effectiveness in maximizing the best outcome using fewer resources.

The efficiency indicator for finance and human resources is the Administrative Services as a Percentage of Total Expense (ASEPTE).

We used the variable gender to identify group heterogeneity of hospital boards grouped by the Local Health Integration Networks (LHINs) and the efficiency indicator ASEPTE to show regional organizational performance.

CHAPTER 2

Background—What theory reveals

Research involving Upper Echelons Theory (UET) in business has provided executives with a novel approach to improving corporate efficiency. Interestingly, unexpected patterns in data revealed valuable information for organizations regardless of the industry. However, researchers have had mixed and inconclusive results to support UET. Primarily, causal factors from mixed sample populations skewed the results. Furthermore, subtle changes to the original interpretation of the UET altered the fundamental scope of application. As an example, sampling multiple industries and hierarchies as singular entities led to results that assumed the need of other variables or theory for consideration.

Hambrick encouraged researchers to examine the black box or psychological behaviors of the upper echelons in strategic decision making. Strategic decision making requires interactive relationships of individuals to enhancing the exchange of information and risk taking at a cognitive level. The difficulty in studying this phenomenon is limited access and openness of individuals that could introduce research bias leading to unreliable findings.

Empirical evidence in research has yet to provide results that are usable. The link between cognitive and demographic diversity may be plausible in complementing each other.

Complementing theories such as agency, social identity, behavioral and evolutionary have introduced a holistic approach to studying board’s diversity, composition, dynamics, structure, and roles. In addition, contingency, resource dependence, stewardship, stakeholder, and board power theories have traditionally been used as different types of theoretical frameworks. The above-mentioned theories have a relational component that is driven by individual’s experiences and socialization. See Figure 2.1, representing the research theoretical framework that complements UET.

Figure 2.1 Research theoretical framework and scope

2.1 Upper echelons theory

In this section, we explore various aspects of UET as it relates to women having an important role on corporate boards.

We also present a summary of UET and some results of recent business research on this topic concerning the health care sector.

Hambrick and Mason suggested that UET for top management teams could predict organizational outcomes such as strategic choices and performance levels. In turbulent environments, a challenge for upper echelons is to develop new management processes. A strategic performance level such as organizational survival could benefit from team heterogeneity.

Upper echelons research is multileveled and involves individuals, teams, organizations, and their environments. However, research in UET lacked multilevel theory and proper methodology, resulting in studies that focused on a single industry, did not use multiple data sources skewing results, did not have clear definitions of variables used and interpreted results independently. Consequently, a match between theory, measurement, and statistical analysis essential in research on multiple levels was absent.

The upper echelon characteristics are independent variables as causes of strategic choices that lead to organizati...

Table of contents

• Cover
• Half Title Page
• Title Page
• Copyright Page
• Abstract
• Contents
• Chapter 1: Gender diversity may be the answer to performance
• Chapter 2: Background—What theory reveals
• Chapter 3: The Canadian Local Health Integration Network (LHIN) – Business case
• Chapter 4: Health Care Executive Management Composition—The Good, the Bad, and the Ugly
• Chapter 5: Hospital Performance—A taboo to overcome
• Chapter 6: Dominance—By whom?
• Bibliography
• Index