As a result of renovation and acquisitions of state-of-art equipment by a nearby medical centre, occupancy rates at general hospital dropped. This forced the hospital to eliminate some services that it could not offer competitively with the medical centre. Just to make things worse, the hospital experienced an increase in Medicaid and Medicare patients, which is often associated with low income generation by the government insurance plans. The hospital faced reduced capabilities of generating sufficient income, which threatened survival and accreditation of the hospital in the long run.
According to Mr. Hammer, the hospital CEO, the only way out of the difficulty would be to cut costs and increase revenue to facilitate addition of new services as well as expansion of the existing ones (Bowditch & Buono, 2003). This strategy was to be used to ensure that the hospital competes with the medical center in certain areas. According to Mr. Hammer, hospital physicians were the main factor causing the hospital high costs because they did not understand and were not interested in significance of low costs to the sustainability of the hospital. Instead, physicians demonstrated unfailing allegiance to their profession and not to the hospital, which yet had patient privileges. Moreover, the pharmaceutical companies increased prices of their products to provide shares for its supportive employees. This decision caused a conflict between members of staff who agreed with such policy and those who opposed it. The main problem at General hospital was the conflict over costs control, management, and physician agreement.
Discuss the Conflict Management Styles that are Evident in the Case
In general hospital case, some of the conflict management styles include forceful management style. This is evident from when Mr. Hammer became authoritative and decided to use force to solve the organizational costs problem. Mr. Harding assisted Mr. Hammer in using his position of a manager to make decisions for other staff members without discussing the issue with the parties involved. This was done despite the fact that it caused a rift among the employees. Another type of managing conflict is ‘avoidance,’ where decision that is chosen by the majority of the staff members is taken as absolute. This is evident when Mr. Hammer attempted to introduce cost-cutting strategies into the company management plan, but Mr. Williams and physicians were opposed to it. Their opposition was unanimously supported by the board members regardless of any arguments Mr. Hammer gave.
In this case, board members chose to avoid Mr. Hammer in order to solve the conflict between him and the physicians. Other conflict management styles used in this case are handling style, collaborating style, and compromising style. The collaborating style was used by Mr. Hammer when he tried to make suggestions to physicians on how to cut costs, but his ideas were rejected.
Discuss how General Hospital Could Have used Teams to Address the Cost Reductions Needed to Stay Competitive
One approach that general hospital could have addressed – while dealing with cost reduction issues by using teams – is facilitating bargaining. This is the best approach considering that both parties may have suggestions on how to solve the problem. The CEO must help the conflicting parties reach a compromise where the needs of everybody are considered while attempting to cut organization costs. This will ensure that both patties end up benefiting from the existing situation (Fisher, Rayner, & Belgard, 2001). Besides, encouraging consultation between the conflicting parties will help ease the tension while allowing room for compromise. This will encourage the teams to use their diverse and broad ideas to help find the best solution that includes the needs of the physicians and, at the same time, allows cutting costs.
Describe how Hammer can Use Negotiation Skills to get Buy-in for the Cost Reductions
To solve the existing conflicts in the hospital, it is necessary for Mr. Hammer and the physicians to work together to promote survival and sustainability of the organization. In order for the hospital to expand its services and remain competitive in the industry, Mr. Hammer will have to use his negotiation skills to reach cost reduction goals (Moss, 1995). Negotiation skills will help him determine a common ground both parties agree on. This will lead to the benefit of both parties reducing costs while still allowing to take care of the needs of the physicians.
Recommend a Strategy for Hammer to Resolve the Problem.
One of the recommended strategies that Mr. Hammer could employ to resolve the problem at general hospital is to use collaboration. It is one of the most effective methods of managing conflicts turning them to a win-win situation. Solutions made will allow both the physicians and the management to achieve their goals (Kezsbom, 2002). Mr. Hammer should discuss the problem directly with the physicians. He should relate facts to the issue of cost reduction while considering their needs. This will foster an understanding and, hence, promote collaborative approach to solving the current stalemate. Finally, Mr. Hammer can employ negotiations to solve the conflict at general hospital. This is achieved through looking for a common point of view and agreement by listening to both sides fairly. Owing to this, both parties can understand each other well.