Opinion: How health care organizations can be designed to fail

We recently set up our first meeting with the CEO of a hospital in another state. The hospital had just hired us to help them involve their employees in the execution of their strategic plan. The CEO asked our engagement manager, Bethany Taff, which departments we would like to meet with while we were on-site. Bethany quickly listed four very specific departments and the CEO gasped.

“How did you select those departments?” he asked.

Seeing his reaction, I asked the CEO why he asked that question. The CEO responded that they had just done an outside employee engagement survey, which we hadn’t seen yet, and Bethany had just asked to speak with the three departments with the lowest engagement scores. The CEO wondered how Bethany had chosen those departments.

The answer was simple. We had the organizational chart.

The organizational chart is one of the most undervalued tools in many organizations. The chart is often maintained just to keep track of employees, but leaders often don’t spend enough time reviewing and using it for what it is – an organizational design blueprint.

What did this hospital’s organizational chart show that highlighted potential problems?

One department showed a supervisor who oversaw about 45 employees. How does a supervisor effectively manage 45 people? They can’t. When a supervisor oversees more than 10 people, it’s a good time to start asking questions.

There is no hard number for how many employees a supervisor can manage. The ideal number of direct reports might be more than 10 if the employees all perform a similar job that is very visible to the supervisor, such as in manufacturing. The ideal number of direct reports might be lower if each job is highly specialized and complex, such as an executive team. If an organizational chart shows a supervisor with 45 employees, it’s likely a department with low accountability and high disengagement regardless of the effectiveness of the supervisor.

The second department Bethany identified on the organizational chart showed a lot of dotted lines. It appeared that some employees had two or three supervisors that oversaw their jobs depending on the shift. In effect, each employee had multiple bosses. This is a recipe for disengagement.

Think of the movie, “Office Space.” At the beginning of the movie, the lead character forgets to put a cover on his “TPS report,” which is clearly against company policy. Throughout the course of the day, the lead character is approached by multiple supervisors about the same issue. It’s a demoralizing example of getting in trouble multiple times for one mistake. When an employee has multiple supervisors, the risk is that either the employee will get too much feedback or, more commonly, not enough feedback. In situations where we see a troubled employee float between supervisors, we often hear supervisors positioning themselves to leave the problem to others. Nobody ends up having the difficult conversations to help the employee be more successful. If you want to maximize engagement, every employee deserves to know who is ultimately judging their performance, even if that employee may work under someone else directing their work for a time. In other words, when we see dotted lines, it may reveal disengagement.

The last department had very confusing titles. It was unclear who did what. If it is unclear on the organizational chart, it is often unclear in real life. When we engaged this department, we learned that a lot of the people on the team had jobs that had evolved as they grew. For example, one person who was head of training also oversaw quality and physician relations. Furthermore, this person reported to the chief financial officer. When we asked this person how she knew if she was successful, she shrugged and said, “I just do what I can.” She was frustrated and understandably underperformed in all three functions.

Organizations are like machines, and those machines are perfectly designed to get the results they are currently getting. As health care organizations grow and innovate while also trying to control costs, leaders often add roles piecemeal without thinking about the overall organizational design. The results are wonky organizational charts, disengaged employees, low patient satisfaction and poor financials.

Engagement numbers can improve significantly, and quickly, simply by clarifying roles, reducing the number of direct reports per supervisor, and by ensuring that each employee has one boss. By upgrading the organizational machine, health care organizations become more successful in all areas.

Don Harkey is the owner and CEO of People Centric Consulting Group. He can be reached at donharkey@peopleccg.com.