This paper would be describing the various processes that are involved for the Memorial Hospital under the category of resource acquisition and then resource allocation. Since these are two different kinds of processes which need to different kinds of explanation categories, the paper has chosen to first discuss the problem and method of resource acquisition for the hospital and then discuss in the latter part the resource allocation method. Another objective of this paper after it has discussed these two processes and methods is to discuss about the change process of the hospital and the role that the chief executive officer plays in such a process.
To achieve the objectives of this paper, it shall be using various references from peer-reviewed journal articles and other academic literature. Also, it would be making use of hypothetical scenarios and processes that, at least to the trained eye and experience reader, could fairly be associated to actual operations of modern hospitals today. Although the limitations of this paper suggests that it could not conceivably be able to capture the extensive details of the change process in a few pages, it would at least try to be able to conceptualize a process map for the resource acquisition and allocation process for the hospital, its executives, its managers, and even its staff.
In the resource acquisition phase, perhaps the most important detail to specify and to understand is the organizational hierarchy that the hospital has (Dobbin & Sutton, 1998). The organization, although consisting of various different employees, basically follows the managerial method for having a bureaucratic organizational structure where in the board of directors is at the top of the decision-making tree. A member of the board of directors is also the chief executive officer — often called the CEO — and is the main decision-maker for the hospital. Directly under the CEO is the Dir. of finance for the hospital whose responsibilities it is to be able to account for the various monetary details and assets. This individual plays an important role in the acquisition process because he’s the one who would be making essential observations and accounting for the budget that would be needed to bring about resource acquisition. Under the director of finance is the director of nursing, another individual who is important in the process and of acquiring new resources and assets for the hospital. Under the director of nursing on the nursing managers and under the nur are the nursing staff the hospital.
Basically, any resource acquisition process, there are two general broad categories of resources which require although identical steps and methods, have various difficulties with respect to final approval in the upper levels of management. These two kinds of resources are low-cost disposable resources and high-cost assets (West et al., 2002). Low-cost resources may be described as those tools to be used in the hospital which are disposable such as gloves, syringes, medicines, sheets, bedcovers, blankets, tools such as stethoscopes, thermometers, and the like. On the other hand, high-cost assets are those which are classified under the general category of machinery which would be used by the hospital over a period of years, and therefore belongs to the classification of investments rather than disposable assets.
The process of resource acquisition is followed from a bottom to top face. This means that when low-cost resources are observed to be running out by nurses, the nursing staff would be reporting such a shortage — or at least a future shortage — to the nursing manager. It is then the duty of the nursing manager to investigate these resources would indeed be needed for this specific nursing Department and yet there are still resources available, along with these supplies last. In the nursing manager has decided upon observation and investigation that they resources need to be acquired, he or she would then be reporting to the Dir. of nursing in a formal document of reports about the future scarcity of the resource and why it is essential to stop such resources in the hospital. Then, it would be the duty of the Dir. of nursing to forward, together with an official recommendation, such a request to the Dir. of finance.
In the resource acquisition phase, perhaps it is the Dir. of finance which place one of the most important roles because he is the one who would be deciding if such resources are indeed needed — basing from the report of the Dir. of nursing and the recommendations of the nursing managers — and that they would fall within such budget of the hospital. Also, it would fall upon his duty to decide exactly how much to purchase or if they would be purchased in bulk or in separate orders, depending on the costs that are involved in purchasing them.
Also, the director of finance would not only use such information together with the financial information he already has to estimate the cost of acquiring such new resources, but also he able to generate a profit margin and how these resources may be able to generate further profits in the future for the hospital area this may be done through various methods such as cost-benefit analysis, supply budgeting, and so forth. However, because many of the supplies that are recommended by the nurses, the nursing manager, and the director of nursing to the financial officer are indeed essential supplies to the hospital, and because they are low-cost requirements, they would probably be immediately approved and the director of finance would then seek the decision and approval of the chief executive officer of the hospital for the approval of the budget and the purchasing of such materials. Here, the chief executive officer does not anymore need to consult the decision of the board of directors of hospitals because they are operating expenses and are expected only from such operations (Gist, 1987).
On the other hand, in the resource acquisition phase for expensive assets such as machinery for the hospital, although the process is the same, the starting point would be the director of nursing which recommends to the Dir. of finance if it would be falling under the budget of the hospital to invest in such new machinery. Here, it would be the responsibility of the Dir. of nursing to explain to the Dir. of finance how such machinery is important and why it would be essential in the profitability of the hospital as well as the general welfare of its patients. Here, the director of finance would again compute the possible costs versus benefits of investing in new resources and high-cost machinery and would forward it to the chief executive officer for approval if it has been approved by the books of the director of finance.
Depending on the magnitude, price, or cost of the investment and assets — ranging from low-cost machinery to high-cost machinery and even infrastructure projects, the chief executive officer, although the decision-maker for the hospital, would then need to consult the board of directors in the decision to make and purchase such resources. Usually, the board of directors are not anymore consulted in the purchasing of the machinery because they trust the chief executive officer to make educated decisions — both from the perspective of financial as well as practical — the purchasing the machinery. However, if the resources that have been requested in all high-cost infrastructure, the board of directors are often consulted for such a purpose because this involves the use of assets that the directors usually owned mass form of capital investments in their part.
What this is the basic process that would be followed by the Memorial Hospital for resource acquisition. On the other hand, in the resource allocation phase, it would be more complicated because there are many processes and steps which must be followed. In resource acquisition, the process was from the bottom up for requesting new materials, assets, and even machinery and infrastructure. On the other hand, for resource allocation, the decision would play between the chief executive officer, the director of finance, and the director of nursing and where to allocate its resources upon purchase. One must remember that in the resource allocation phase, if lower-level nursing staff and other employees request materials to be used for their departments, because of certain implications such as scarcity, cost, and distribution, higher decision-makers and managers could not conceivably just freely release such new resources to those who have requested them because other departments also need such resources and it is a balancing act between managers and decision makers on how to allocate such resources for most efficient and optimal use.
At least for allocation, the decision would play between the director of finance who would make a cost-benefit analysis on what departments may be the most profitable if further assets and investments are channeled into such departments. Here, of the director of finance could probably make a cost-benefit analysis, computation subnet present valuation, and even feasibility studies of how profitable resources would be if they are allocated to certain departments in the hospital. Also, another factor of consideration that the director of finance would take in his study and his estimation is that if such departments already have presently scarce resources, which again in economics and managerial science tells us that assets would be most efficient and most profitable in places where they already experienced relative scarcity.
Then, the director of nursing could also play a role in the estimation of the allocation of resources by communicating with nursing managers, who would in turn communicate with lower-level nurses and employees on what kinds of resources they need so that recommendations may be made for the allocation process. It is only after such a process, method, and decision tree has been done could resources be allocated to the hospital staff to be used and been a profitable through day-to-day operations.
So far, we have considered the resource acquisition process and the resource allocation process to be two separate entities and processors in the operations of the Memorial Hospital. However, what we must remember is that these two processes do not necessarily have to occur separately but rather, in real world applications, and in actual operations of hospitals and other business institutions, have been real-time and simultaneously. Usually, the resource acquisition phase and the resource allocation phase is done at the same time we’re in nurse managers and directors both of employees and finance, together with the chief executive officer, constantly makes decisions and roles depending on the existing requests and allegations that have been made of present and past resources for the hospital. Although it may indeed be true that the resource acquisition phase is a bottom-up process, and the resource allocation phase is a top down process, the actual operations of the hospital with respect to the allocation of a resource within a system operates at the same time and most of the time with intersecting agents especially if the budget of a certain institution is tight and resources must be maximized depending on what department needs them.
In fact, in real world operations of hospitals, there are even instances where resource allocation and acquisition are done in a matrix situation where departments within hospitals share resources, machinery, and other types of assets in order to make the most efficient use. For example, an ultrasound machine may be used by a department that focuses on childbirth class at the same time be used by departments that focus on internal medicine. Because such machinery are expensive, it would not be practical for the managers of the hospital to purchase individual machinery but rather depend on the various requests made by departments in the acquisition method in order to make decisions on how to best allocate such resources depending on the time, energy, and profitability where these materials will be used.
Another issue that we would like to address in this paper is the change process of the hospital. And managerial science, change is a very essential aspect in for operations because organizational change allows for companies and firms to be able to adapt to the demands of modern customers as well as various new factors and variables involved in operations such as integration of new technology, assets, as well as knowledge and information (Wright & McMahan, 1999). In the Memorial Hospital, the change process is under the responsibility of the chief executive officer because, as many references in the future of management have pointed out, there must be a single change agent who will be leading the change process and it would be ideal for this memorial institution for the chief executive officer, being the highest decision maker of the organization, to be the one that decides on what kinds of organizational changes are implemented in the hospital. However, of course, the CEO may not be able to implement this change process by himself, and in any change management scenario and organizational change process, a change agent must also have further agents and departments which would help engage him in the process of organizational change (Arthur, 1994). There is rich literature in management science which deals with barriers to change and this includes the problems of allocation of responsibilities to lower managerial staff from the chief executive officer. Therefore, the governing body of the hospital — it’s managers and other operational department heads — should work and communicate with the chief executive officer on the various plans he or she has implemented in order to bring about the organizational change process. Here, the chief executive officer must be able to integrate into the discussion and make the governing body of the hospital understand why the organizational change factor in variable would be essential for future profitability and operability of the hospital and they would in turn channel this information to other nurses and employees of the organization.
This paper has discussed the resource allocation and resource acquisition process that would be experienced by the Memorial Hospital. We have already earlier stated that although it does not indeed cover all the essential aspects in details of the process, it at least gives a significant roadmap and discussion on the various details that must be addressed especially given the various organizational units are the Memorial Hospital. Also, it integrates within its discussion how the chief executive officer must use the governing body of the organization and hospital to bring about organizational change and what are the essential issues that must be addressed in this change process especially given various barriers to change in management such as failure of communication and the like in cases where there are no communication channels between the government body and the chief executive officer of an organization.
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