Case #1A: Job Satisfaction Miracle Medical Center: Caught in the health-care squeeze
Miracle Medical Center was established in the early 1900s in Baltimore
City. For over three quarters of a century, it has
developed a sterling reputation for providing health care to all city residents in need, both wealthy and poor. It has also
established itself as a regional center for treating orthopedic problems and traumas caused by gunshot wounds. Patients who
need orthopedic surgery are referred from all over the mid-Atlantic region. MMC offers a full range of medical services to the
city and surrounding counties. It has drawn many of its excellent medical specialty personnel from Johns Hopkins U. and the
University of Maryland schools, both of which have strong national and international reputations. Up until the last decade, it has
been able to maintain a strong medical support staff including nurses and medical technicians, many of whom have been with the
institution for most of their careers.
Since the health care reform began to really take hold over the past
ten years, MMC is beginning to experience competition
from both smaller and larger hospitals which seem to be able to provide services for considerably lower costs. However, it has
been only recently, with the decline of the Baltimore population, that MMC has had to focus on cost control to stay viable.
In an effort to address the change management issues such as increased
competition, restructuring of the health industry and
controls exerted by HMOs, MMC retained the help of Bean Counters Group, Inc., a big eight accounting firm, to assist them in
instituting cost containment measures.
After downsizing as much of its nursing staff and service personnel
that was deemed feasible, BCG informed MCC
management that its costs were still significantly higher than its regional competitors'. It seems that the primary reason MMC is
unable to develop a competitive cost structure is because the board of directors insists that the institution maintain a full range of
services to accommodate the population of city residents they serve. Thus, the board's mandate results in creating a two-fold
problem that impedes cost reduction measures available to most other hospitals. Many of the city residents are elderly, have
access only to MMC, and are often on some sort of public assistance. Therefore, the third party reimbursement rates are often
below what competitors are willing to accept. This of course, places a disproportionate share of the burden on MMC to
provide indigent patients with medical care. Secondly, in order to maintain the range and level of services needed, MMC must
continually invest large sums of money to buy state of the art equipment and keep it up to date.
In 1993, BCG analyzed the organization and decided to reduce operating
costs through downsizing and improving work
performance. They began first by analyzing all jobs and eliminated any duplications. Where possible, existing personnel picked
up the job tasks for those positions that were eliminated. At this point, there was anecdotal evidence of complaints from
technical personnel who already felt stretched.
All nurses were asked to assume more responsibility and the floor nurses
were re-organized altogether. BCG promoted this as
cost saving measure as "job enrichment." By doing so, they were able to "flatten" the organization somewhat by eliminating
several nurse supervisors. Unfortunately, those "downsized" were some of the most experienced and most liked by fellow
employees. Many unit nurses were reassigned in order spread the staff to cover more units with fewer nurses. This tended to
break up established social groups who had worked together for years.
Each nurse was given responsibility for a specific number of patients
on the unit. With the exception of the Critical Care Unit,
each department was set up using the same formula for assigning patients to nursing staff. Nurses on some units, however, felt
that they had a much heavier load than others whose patients generally needed less attention.
Under the "Save a buck" Continuous Quality Improvement (CQI) program
BCG set up, the technical blood work lab was able
to reduce the turnaround time for blood tests, and pick up the overflow of testing from a nearby smaller hospital. With this new
initiative, and by using overtime more efficiently, the lab was able to save $65 thousand over two years. As a result of their
excellent program, they won the Miracle Money Manager Award (MMMA) for 1995. They were very proud of their
accomplishment until their VP of operations told them that because they were so effective, they should be able to do even a
better job in the coming year.
Each unit or department that was able to reduce costs that could be
quantified, was rewarded by giving a bonus to all members
of the group. Tom Gullikson, a unit supervisor in physical plant, however, informed the CQI counsel that several of his crew
were disgruntled since it was well known that only a couple of people in his group really did anything toward the cost savings.
Recently, although the cause is unclear, there has been an increase
in turnover, especially for the technical positions. Rod Laver,
a personnel generalist, who does recruitment and initial interviewing, noted that other hospitals are paying about two to four
thousand dollars more for what he thinks are the same jobs.
Lindsey Davenport, the HR director, is concerned about what's happening
and has brought the matter to the attention of the
Quality Council. She also talked about it informally with the consultants with BCG. The chief consultant told her that this is to
be expected and that any morale problems will dissipate over time, and not to worry about it. He emphasized that she should
simply try to motivate everyone to meet the projected savings that are targeted for each department. The Quality Counsel
members are more willing to listen. They have heard some of the grumbling, but say that at this point there is no clear evidence
that it's really a problem.
The Chief Operations Officer, Richard Reneberg, has been hearing about
all of this and has discussed the situation with Lindsey
who has asked you, as personnel specialist, to figure out what should be done. She wants you to decide how to address the
potential (or real) morale problem and then decide what action should be taken to resolve it. She asks that you come up with a
couple of well thought-out recommendations to assess the situation. Although she feels that this is an urgent issue to address,
wants you to take into consideration the time and costs that may be involved.
Some questions you may want to address:
1. What job satisfaction theory(s) would best explain the situation here?
2. How is the best way to study the problem?
3. What are the expected consequences to the organization to MMC if things continue as they are?
4. If it's a morale problem, how is it likely to affect productivity?
5. If it is a morale problem, what are the probable sources of discontent?
6. Offer possible solutions, recommend the best one(s) and suggest an
The performance appraisal system for the sales department at Kidsgo Corporation is being challenged by a group of African Americans (AAs) who feel it is biased against them. Fifty of the 70 sales clerks are AA. Although the performance appraisal has not been revised for several years, it seems to be constructed reasonably well regarding the SKAs it assesses. Employees are rated on sales volume, absenteeism, customer relations, looks, friendliness, inventory stocking, and cash register operations. The results are recorded in each employee’s personnel file and are reviewed with each employee in February.
There have been numerous complaints from several Aas who insist that the supervisors, all of whom are white except two, seem to rate their sale staff differently when they complete the performance appraisals every January after Christmas sales. Within the last week, there have been three customers who have complained to floor managers about discourteous behavior from two of the clerks, both of whom were AA. The store manager, Izzie Friendly, has heard about the complaints and is ready to step in and fire the two. But Anita Toyee, the Personnel Manager, has convinced him not to act precipitously, but to find out more before he takes action.
Chanda Rubin, one of the two AA supervisors, who is also a good friend of Anita’s, hangs out with some of the AA clerks. She has told Anita that she thinks a couple of the (AAs) have a bad attitude and are purposely trying to stir up discontent to cause trouble. Chanda also says that she heard from the grapevine that both of them are planning to quit as soon as they get their Christmas bonus.
As personnel specialists, Anita Toyee, your Personnel Manager, has asked you to look into the situation and decide what to do about it. She knows that you studied about job satisfaction while you were a graduate student. And based on conversations the two of you have had, she is convinced that you know a lot about the dynamics of attitude formation and change.
Her directives are:
1 Adapted from Muchinsky, P. (1993). Psychology
Applied to Work: Student Workbook. 4th Ed. Wadworth: Belmont,
CAGroup Case #JSs2
Delco Divers Inc. employs underwater SCUBA divers to help locate missing bodies, sunken ships, and lost articles (of value). All of the divers are certified and hired only after they have demonstrated their ability to work effectively. Recently, several of the more senior divers have complained to their crew chief that they have heard that their competitor, Scooper Scuba, is paying its divers five dollars more an hour, and doesn’t require them to work when the outside temperature is below 35 degrees. Sandy Bottoms, one of the divers from Scooper, has been showing off her new state-of-the-art high-tech regulator that breathes for her when she forgets to take a breath.
Delco has been having some cash flow problems over the past few months and almost couldn’t make payroll two weeks ago. Dick Diver, Delco’s owner, knows he can’t afford to increase their pay to match the competitor’s pay rates, and says if that’s the only thing that will satisfy the complainers, there’s nothing he can do about it. If their complaints are just a passing concern, Dick feels he could handle that, but he thinks there may be some real problems surfacing. He believes that several are purposely slowing down the recoveries to increase their bottom time for more pay.
Although divers always work in teams of two, they are essentially on their own and have no company official accompanying them on the job sites. Thus, their work cannot be observed directly by management. And since Delco doesn’t have the expensive underwater Eva Marine Video cameras, the crew chiefs have to trust the divers to work steadily and pace themselves properly on the dives.
In spite of the fact that Dick hired you to steer the boat, fill the tanks and do payroll, he also knows that you’re a personnel specialist waiting to snag a high paying job in HR. So, he figures maybe you can scope out the situation and come up with an answer or two. He knows that if he lets another big customer such as Search and Find, Inc., slip away because of diver discontent, Delco could go under for good.
He wants you to find out what the divers are up to by determining the extent of the discontent and how many divers are disgruntled. He would also like to know if any are planning to quit and sign on with Scooper. It’s all on your shoulders to get Delco back on course.
He expects you to come up with:
Until recently, Faultimore County School System has held the reputation for having the best; most dedicated teaching staff in the State of Maryland. However, over the past year, the newly hired superintendent, Stuart Hamm, has moved quickly to "redistribute" staff where he feels they are most needed. Dr. Hamm’s predecessor had established an un-official policy of letting teachers remain in a school once they found one they liked. Dr. Hamm feels, however, that some of the larger schools in less well-to-do districts are getting the short end because the best, most experienced teachers seem to gravitate to the more affluent schools which generally have the best students and fewer disciplinary problems.
In addition to this change, Dr. Hamm has also quickly moved to implement
inclusion" of special education students into the regular classrooms. In addition to being a cost saving measure, he says this is necessary to satisfy the federal mandate, which stipulates that inclusion has to get underway.
Finally, in an effort to "restructure" the school system to put his own management team in place, Stuart Hamm himself has reevaluated his principals and assistant principals. However, in doing so, he has completely disregarded the formal performance appraisal process altogether, as well as past evaluations. He has demoted about 30 in these two job classes and reassigned others without having ever discussed it with them. Not surprisingly, the teachers local union is up in arms both about the drastic personnel actions and the move to begin inclusion without preparing the teaching staff for it.
Unfortunately, there seems to be clear evidence that the central office staff as well as the teachers feel intimidated and fear reprisal if they were to speak out. This notion has surfaced from the bottom up, and even though Dr. Hamm has been informed by a close confidant, he dismisses it as rumor and something to be expected whenever a new forward-thinking superintendent takes over. "This is not an unexpected reaction," he says, and one "that will blow over by next year." He adds that "Even If it doesn’t, that’s too bad….they’re going to have to learn to live with a leader who takes charge and makes decisions the way he knows they should be made."
He knows that his HR Director, Kenny Doit, is extremely competent and an experienced personnel administrator. Therefore, he feels that Kenny can find a way to defend the personnel changes he has made, while at the same time breaking the back of the union. Hamm says that this is something that must be done if the county is to develop a school system capable of addressing the educational needs in the coming decades.
In order to accomplish this feat, Dr. Hamm has decided that he need to demonstrate to the public that the teachers are in fact, very pleased with his management style and the actions he has taken. Therefore, "all we need to do," he said, is to "show with some kind of employee morale survey, that things are just fine here." When Kenny raised the question of "what if there really is wide spread discontent in the system?" Hamm replied, "Even if there were…and I don’t believe if for a minute…any of them who would want to express a negative opinion probably won’t do it because they’d think I would find out who they were." Hamm continued, "What we need to do is have the assistant superintendent send out a memo to everyone telling them a survey is coming around and we need a show of confidence for the ‘Chief.’ He can emphasize that it’s time for us to stand together for the good of the students who deserve a system that will prepare them for the 21st century."
At this point, Dr. Hamm asked Kenny, "Why don’t you have your staff…some of those personnel specialists…put together a survey and make sure they know how to analyze it in a way that will make us look good. I don’t mean that we should try to fudge anything…just put us in the right light. Figure how much time you need. But see if you can get a plan together by tomorrow with a timeline, and make sure it’s a fool-proof strategy. We don’t want this thing to backfire on us. Let me know if you think there will be any problems. If so, I’ll see that it’s taken care of. Any questions?"
Along with several others, you have been asked by Kenny to see what you can do to move on a plan to survey the morale of the employees. Kenny asks whether you’ll need to devise one or if there is something already available that would take less time. He tells you it’s important to remember that we don’t want to do anything shady. "Besides," he says "I convinced that by simply playing it by the book we’ll be get what we need, especially given the climate out there these days." He ends by asking you to: