Academic journal article Australian Health Review

Organisational Development in a Rural Hospital in Australia

Academic journal article Australian Health Review

Organisational Development in a Rural Hospital in Australia

Article excerpt


Public hospitals worldwide continue to experience fundamental changes as governments have introduced more stringent accountability measures to increase efficiency, effectiveness and improve service quality.1,2 Some health organisations have responded by using 'quick and dirty' approaches to organisational change, whereas others have drawn on more inclusive and more time-consuming organisational development (OD) approaches.3,4 OD is time consuming because it emphasises the importance of involving employees in change and decision-making processes.5 However, whatever approach is used, the evidence suggests that success is rare6 and that change projects can create confusion, anxiety and stress that impedes and paralyses effective decision making.7

This paper reports on a single case study of an OD project in a rural health service in Australia. The researchers were actively engaged in facilitating the change process over 3 years. This health service was perceived by government and accreditation agencies as a low performer for poor financial, throughput and quality outcomes and high levels of industrial disputation. In 2004, the hospital scored poorly in the Australian Council on Healthcare Standards independent accreditation process and had a serious adverse event that was related to inadequate clinical risk management. The seriousness of the adverse event and perceived mismanagement led to scrutiny by the state government and health accreditation bodies. Consulting studies funded by government to improve performance identified issues with organisational structures and processes, suggesting that the management had not kept up with the growth in staff and services. The consultants also reported a high level of staff disengagement and dissatisfaction. As a response to these investigations, the organisation introduced a new more decentralised organisational structure in 2004 and Executive Directors were employed in key functional areas.

Subsequently, the hospital approached the university team in an attempt to improve the organisation's performance. An initiative wasdesignedasa joint project between the agency's senior management team and a team of university researchers. It has been noted that public sector change has often been unsuccessful due to embedded practices, bureaucracy, frequently changing senior leadership and the complexity of reforms.8 In exploring and analysing the successes and failures in this case, we draw on change models and literature as well as health literature to investigate why the OD intervention did not proceed according to plan.

The structure of this paper is as follows: first, we explore the literature; second, we outline the case study context; third, we describe the OD intervention; and fourth, we draw conclusions. We embed our qualitative methodology of in-depth interviews and focus groups, and researcher observation as active participants in the project, into this story and into the analysis. For confidentiality we have named this agency Gum Leaf Health Service.

Literature review

Understanding forces that cause resistance, and programs and strategies that will increase motivation are essential in any change process.9 In this, the role of change agents such as top managers, middle managers and operational staff are key. Lüscher and Lewis7 argue in particular that middle managers are the lynch pins of organisational change because they operationalise change initiatives aligning their units to top management mandates. Higher managers' contact with employees often relies on middle managers as intermediaries andboundary spanners, whereas front line managers look to middle managers for sense making.7 Evidence suggests that change processes often fail,10 that success in one part of the organisation may not translate into organisationlevel performance11 and that change may fail to deliver expected organisation-wide results.6 Fluctuating organisational expectations may render managers unable to understand the shifting world12 and the confusion, anxiety and stress that middle managers experience as part of the change process may impede decisionmaking. …

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