Employee Suggestion Programs in the Health Care Field: The Rewards of Involvement

By Mishra, Jitendra M. | Public Personnel Management, Winter 1994 | Go to article overview

Employee Suggestion Programs in the Health Care Field: The Rewards of Involvement


Mishra, Jitendra M., Public Personnel Management


As concern about ways to increase employee participation has grown, many organizations, both service and manufacturing, have turned to an employee suggestion program (ESP) as a key part of their management approach. An ESP is a formal attempt to elicit useful operating ideas from individuals or groups of employees. It is hoped that employee suggestions will yield cost savings, productivity gains, and higher overall profits, while rewarding participants with monetary compensation, recognition, and the satisfaction of seeing their ideas adopted.

ESPs have roots in both industry and government. One of the earliest implementers was Alexander Hamilton. While serving as Secretary of the Treasury under George Washington, Hamilton asked his officers to "note and communicate the merits/deficits of the Revenue System and to point out methods of improving them."[1] One of the first major industry programs was that of Eastman Kodak; the system went into effect in 1898 when a worker received compensation of $2 for his suggestion that the company wash its windows.[2]

In recent years, ESPs have become a widely used and effective management tool. The National Association of Suggestion Systems (NASS), a Chicago-based nonprofit group that represents companies involved with ESPs, surveyed its 900 members in 1989 and found that nearly one million employee suggestions had been received through company ESPs. The respondents further indicated that more than 32 percent of those suggestions were adopted, for a total cost savings of at least two billion dollars.[3,16]

The health care environment is becoming increasingly competitive and the concern about ways to increase employee participation is growing. Hospitals have been forced to seek additional and alternative sources of revenue because of escalating health care costs. Many organizations are turning to employee suggestion programs as a key part of their management approach. True participation in employee suggestion programs require an environment that recognizes the expertise of the participants and allows open interaction among people. In today's tightly constrained environment of health care, such participation is essential in order to engage qualified persons in activities that allow involvement and commitment. "Employee involvement programs are among the best ways to attain total quality and aim for continuous improvement."[4]

During the 1980s employee involvement programs swept the manufacturing sector as a new way to build labor/management relations and increase productivity. As manufacturing move out, service occupations grow very rapidly and the people in these occupations are expected to grow too. In service organizations such as hospitals, human capital is at a premium. Since service in an intangible good, patients judge its quality by the quality of their interaction with the service providers.[5]

During a period of transformation, it is particularly crucial that top management recognizes the value of their workforce. Employee input is needed to ensure that employees are "satisfied customers". Employee surveys followed by disclosure of results and problem correction are helpful.

A hospital's human resource philosophy is instrumental for ensuring that the organization consistently acts with sensitivity to its employees. We can't expect our employees to be sensitive to customers' values unless we are sensitive to employees' needs and aspirations. If we can create the type of culture that is based upon employees' needs and aspirations, then people can be our competitive edge as well as our most valued resource.

There are many examples of companies that have done considerable well in implementing a suggestion program within an organization. Reports on cost savings resulting from well-run suggestion systems have generally been favorable. In a 1989 survey of 900 employers, NASS reported that the average net savings for every suggestion implemented was $7,633. …

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