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1.1 Introduction to NHS
Statistics from the NHS Confederation (2007) reports a colossal number of employees and
patients in the NHS. Managers and senior managers account for 2.8 per cent of the almost
1.3 million staff employed by the NHS. 27 per cent of NHS chief executives come from a
clinical background and 50.2 per cent of NHS managers have a clinical background. The
NHS deals with over 1 million patients every 36 hours.
There are many hospitals and infirmaries under the NHS management. From the Leighton
Hospital and Victoria Infirmary, we can see the typical organisation chart of a hospital in
the NHS. Figure 1.1 below is adapted from Mid Cheshire Hospitals NHS Trust (2007).
Figure 1.1 Organisation chart of Leighton Hospital and Victoria Infirmary
In the following sections, we are going to discuss the possible problems in management
and organisation, what had caused them, and what would happen if the organisation had
taken a different strategy.
1.2 Problems in NHS and Possible Causes
The NHS is set in an environment with ever-changing policies and crisis. The Department
of Health (2007) is responsible for frequently changing and implementing policies
affecting the NHS. The National Statistics (2006a, 2006b) reports of an ageing population
caused by pandemic diseases and lower birth rates; hence the public is pressurising the
NHS to improve these numbers. These problems are forcing the NHS to change to cope
with the environment.
In Figure 1.1, we have seen the typical organisation chart of a single division of the NHS.
The one we have seen is just the tip of the iceberg. According to NHS Confederation
(2006), there are 152 primary care trusts and each overseeing many hospitals. With such a
huge number of employees, the NHS inevitably created a tall scalar chain in the
organisation. The organisation is also split into many divisions managed by the primary
care trusts.
Tall scalar chains in the organisation were reported (Management, People and Organisation
2006, p. 3.6) to lower morale, slows decision making and worsen communications. A tall
scalar chain is not advantageous; however, reducing the levels in the scalar chain will
further increase the span of control.
Daft (2006 p. 353) defines span of control as the number of employees reporting to a
supervisor. The higher the span of control, the more the number of employees the
supervisor has under his charge. A high span of control is suitable for organisations where:
- Work is routine and repetitive
- Subordinates perform similar work tasks
- Subordinates specialises in a few tasks
- Rules and regulations are clear
- Little time is needed in non supervisory work like planning
High span of control is only desirable in an organisation where little interaction is needed.
On the other hand, the NHS is unlike a production line where little communication is
required, employees have changing job requirements and information to be passed along.
Daft (2006, p. 375) relates organisation structure to the environment. The following will
happen in an uncertain environment:
- There would be increased differences occurring amongst departments. Each major
department will only focus on their own responsibilities, and hence distinguishes
themselves from the other departments. Departments work autonomously, creating
barriers.
- The organisation will need increased coordination to keep departments working together.
- The organisation must maintain the flexibility to change. Changes in policies or other
factors require even more cooperation departments.
Therefore a vertical organisation structure is unsuitable in an uncertain environment like
the NHS, where new policies are always implemented and crisis outbreak regularly. This
structure will further worsen the communications and decision making process.
The NHS consists of many trusts, hospitals and infirmaries. These entities are spread
across the United Kingdom. Each entity has the management of their own like the
Leighton Hospital and Infirmary in Figure 1.1. This configuration is described as the
divisional structure.
Mintzberg (1981) discussed that divisional structured organisations top management often
uses performance control systems over each divisions but leave the details to the division
management. This system adds extra paper work and slows communications. Tasks are
duplicated across divisions, increasing costs and efficiency. These problems also lead to
increasing the span of control of the managers. Problems associated with a divisional
organisation structure are typically:
- Increased overheads
- Slower and ineffective communications
- Increase the distance between management and their subordinates
- Slow decision making
- Too many people managing a task
- Managers are overloaded because of the above mentioned reasons
Mintzberg (1981) added that centralisation tend to happen within the divisions as they hold
the responsibility of their performances. However divisional structure is difficult to be
dynamic because of the procedures and red tape they have to go though to make a change.
However, Daft (2006 p. 366) argues that in a divisional structure, the organisation has fast
response, is flexible in an unstable environment, fosters concern for customer needs, and
has excellent coordination across functional departments. This was supposed to be
theoretically correct and NHS must have adopted this structure in the hope of gaining all
these advantages. From the previous analysis, all these advantages are wiped out because
of the sheer size of the NHS. Each division would at least have a few thousand employees,
and each division would have a tall scalar chain to adhere to. That would remove the
advantage of being flexible in a changing environment which was discussed in the
previous section. NHS is only situated in one country, which is not overly large. NHS
would not have benefited from having a divisional structure as it does not need to diversify
to blend in with different geographical locations. The last advantage is easily overlapped
