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Implementation of Healthcare Organizational Design


In order to maximize the organizational value by matching the organizational objectives to the overall corporate strategy, there is the need to structure the organizational design. This takes the form of a process of integrating the people, information and technology available to an organization and organizational design is considered as a key element in matching the objectives with the strategies (Burton, DeSanctis, & Obel, 2004). In the case of a health care organization, the organization and management structure should support the design and implementation of mechanisms for improvement in the service quality and enhance the accountability of the organizational members.

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Organizational Structure and Design

The organization structure is a “functional” one with the Chief Administrator in-charge of the total functions of the hospital. There are the following different functional heads assisting the chief administrator in the day-to-day running of the hospital. The functional heads are:

  1. Chief of medical services,
  2. director of administrative services,
  3. Director of outpatient services,
  4. Director of Nutrition and food services.

Employees are grouped in departments by specialty with all the patient care tasks under patient care services.

Organizational design is defined as “the making of decisions but the formal organizational arrangements, including the formal structures and the formal processes that make an organization” (Nadler & Tushman, 1988). Depending on the location of decision-making authority in the hierarchy of the organization, our hospital is a centralized one. Decision-making is centered with the chief administrator as the key person in the organization who makes all the policy decisions and conveys the decisions to all the organizational members through the hierarchical levels. There is a small span of control and this result in many layers of management under the directors. The information flow is vertical and the dominant information flow follows the hierarchy. The degree of formalization is generally high in the organization.


The organization has two hospitals functioning as separate profit centers with an administrator taking care of the functioning of the individual hospital unit. The hospitals are located within a radius of five miles. The functioning of the hospital is regulated with the physicians serving as consultants to the organization and to the patients. They are paid on a fee-for-service. The resources of the hospital like beds, operation theatres and other equipments belong to the respective hospitals and these resources are managed by the administrators attached to each hospital.


This note provides a basic understanding of the organization running the two hospitals. While the structure of the organization is functional based the decision-making is centralized with the chief administrator. The individual hospital units serve as two independent profit centers headed by respective administrators.


Burton, R. M., DeSanctis, G., & Obel, B. (2004). Organizational Design: A Step-by-Step Approach. Cambridgde UK: Cambridge University Press.

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Nadler, M., & Tushman, D. (1988). Strategic organization design : concepts, tools and processes. London: Scott, Foresman and Company.

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