Assignment Two

MGG1010 Introduction to Management

Prepare a report that identifies, discusses and evaluates how the ideas from any two functions of management can be used by managers to encourage sustainable management in their organisation.

TABLE OF CONTENTS
1. Executive Summary

...............................................................................ii

2. Introduction

...............................................................................1 Purpose Scope ...............................................................................1 ...............................................................................1

2.1 2.2 2.3 2.4 2.5 2.6 2.7

Methodology ...............................................................................1 Assumptions ...............................................................................1 Limitations ...............................................................................1

Background ...............................................................................1 Plan ...............................................................................1

3. Discussion

...............................................................................2 Planning 3.1.1 3.1.2 ...............................................................................2 Human Resource Sustainability Natural Resource Sustainability .........................2 .........................2

3.1

3.2

Leading 3.2.1 3.2.2

...............................................................................3 Human Resource Sustainability Natural Resource Sustainability .........................3 .........................3

4. Conclusion

...............................................................................4

5. Recommendations

...............................................................................4

6. Reference List

...............................................................................6

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i.

1. Executive Summary

The purpose of this report is to advise Company Xs Chief Executive Officer of the manner in which effective use of the planning and leading functions can be utilised to encourage sustainable management within the organisation. The report was commissioned by the newly appointed CEO following a decline in staff morale and the previous managements ignorance to issues of ecological sustainability. In Item 3, the report examines the sustainable management theory in the context of the planning and leading functions, and specifically, how to maintain natural resources and its human capital in a financially viable manner. The positive impacts of increasing educational opportunities for staff and restructuring the organisation to take on an empowerment approach are then analysed. The issue of future staffing requirements is highlighted as an area of importance, which can be combated by workforce planning in order to minimise the impact of external forces such as the ageing population. It is also suggested that the planning function is utilised to determine the viability of electronic healthcare records in the organisation (Item 3.1.2). The managerial function of leading is highlighted as crucial to the improvement of organisational culture in Item 3.2.1). The report discusses how communication channels can be used to facilitate two-way dialogue between top management and staff to foster an inclusive environment. Also through the leading function, the environmental sustainability objective included in the strategic direction of the organisation at the planning level is promoted to staff to stimulate innovation in the area. Furthermore, it is suggested that communication with other organisations in the region will encourage environmental reform across the local healthcare industry. This analysis led to the following recommendations as to the effective use of planning and leading functions to encourage sustainable management in Company X in Item 5: 1. Increase professional development opportunities to staff (refer to Item 3.1.1, paragraph 2).

2. Revise the organisational structure to facilitate the empowerment of staff (refer to Item 3.1.1, paragraph 2).

3. Utilise inclusive communication channels within the organisation (refer to Item 3.2.1, paragraph 2).

4. Engage in workforce planning (refer to Item 3.1.1, paragraph 2).

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5. Undertake a feasibility study on the implementation of electronic healthcare records (refer to Item 3.1.2, paragraph 2).

2. Introduction 2.1 Purpose The purpose of this report is to advise Company Xs Chief Executive Officer (CEO) of the manner in which effective use of the planning and leading functions can be utilised to encourage sustainable management within the organisation. 2.2 Scope This report focuses on the planning and leading functions of management only, considering concepts that are relevant to the nature and size of the organisation. 2.3 Methodology This report was based on briefing received from Company Xs CEO which outlined current issues facing the organisation, objectives of commissioning this report and a copy of their current strategic plan. Interviews were subsequently held at all levels of the organisation and research of relevant literature was undertaken by the author to develop and deepen the exploration of concepts in this report. 2.4 Assumptions It is assumed that all information obtained and reviewed is accurate. 2.5 Limitations As noted in Item 2.2, this report is focussed purely on the planning and leading functions of management, and recognises that elements from the remaining functions would be necessary to bring about the organisational change required to encourage sustainable management. 2.6 Background Company X is a busy, not-for-profit community nursing service in regional Victoria. The organisation employs a staff of approximately 125. A new CEO has recently been appointed, and brings with them a vision of sustainability. They were selected for their broad thinking in areas such as the environment and the impact of current practices on future generations; matters which had not been taken into account when preceding management was determining the strategic direction of the organisation. Furthermore, the CEO has noticed low morale and increasing turnover amongst the ageing nursing staff. For these reasons, this report has been commissioned as a first step to bringing about organisational change, moving towards more sustainable management practices. 2.7 Plan This report will commence with an examination of the sustainable management theory. It will then explain and discuss the management functions of planning and leading and their related concepts in context of sustainable management in Company X. These concepts will be analysed and evaluated, leading to the development of five recommendations. Implementation of these recommendations will result in the functions of planning and leading being effectively used to encourage sustainable management in Company X, thereby ensuring that value from its business activities flows to all its stakeholders, including the environment and society as a whole, for many years to come.

3. Discussion The notion of sustainable management is defined as the responsibility of organisations to ensure their operations use all forms of capital (human, natural and financial) in such a way that all stakeholders receive value, and that the capital required by future generations is maintained (Robbins, Bergman, Stagg, & Coulter, 2009). Given the broad scope of the concept, the discussion will be refined to its application in the context of the planning and leading functions of management as proposed by Fayol (1916). While this theory is an early one, its underlying principles are still relevant to todays managers (Fells, 2000). 3.1 Planning Planning is a management function encompassing the definition of goals, establishment of strategies and development of plans to coordinate activities (Robbins et al., 2009). Importantly, given the topic of sustainability, planning in this context involves both short and long term goals. 3.1.1 Human Resource Sustainability Human resources are arguably Company Xs most valuable asset; without a dedicated staff of nurses it would not be possible to deliver the level of care its clients require. In terms of maintaining a sustainable human capital base in the short term, a key issue to be addressed is the deflated morale of staff, noted in Item 2.6. Immediate planning Studies on low nursing morale have found a number of strategies that are effective in increasing job satisfaction, including educational interventions that enhance the competency of staff (Gilbody et al., 2006), the opportunity to take on innovative roles (Collins, et al., 2000) and salary increases (Callaghan, 2003). Scope may exist for Company X to review its organisational structure, and plan a redistribution of responsibility around the empowerment of clinical staff. Through effective planning, this strategy is likely to deliver greater value in the long term than a similar expenditure to fund wage increases would. Medium to long term goals Strategic planning is necessary to forecast future requirements and develop innovative recruitment tactics to source and attract the talent needed (Mayer, 2008). Without a focus on such planning, potentially foreseeable skills shortages could impact on the organisations ability to deliver service to its clients. This is an area in which planning becomes crucial for two reasons. Firstly, the ageing population will lead to a forecasted 32.5% increase in demand for aged care by 2018 (Victorian Government, 2005). This issue is exacerbated by the already chronic shortage of registered nurses (Human Capital Alliance, 2005). To assist in ensuring the availability of qualified staff in the future, Company X may choose to allow nursing students to complete practical placements required for their studies. This strategy would invest in the future workforce, to the benefit of the organisation and society in general. 3.1.2 Natural Resource Sustainability Strategic planning is relevant to the not-for-profit sector and can provide benefits such as enhanced organisational effectiveness and the promotion of strategic thinking (Bryson, 2010). Whilst the organisation already engages in this practice, a goal as fundamental as 2.

sustainability must be incorporated into the strategic plan and potentially the mission, in order to foster its fulfilment. In terms of natural resources, an area for improvement is the vast use of paper for client files. A feasibility study should be undertaken to ascertain the viability of the implementation of electronic healthcare records. While such a strategy would involve a considerable financial investment, its long term benefits are not limited to ecological ones, but also include savings in time and cost; it is estimated that the handling of paper accounts for 30% of organisational overheads (Velte, Velte, & Elsenpeter, 2008). Following the planning stage, management must engage in the leading function. 3.2 Leading Leading is a management function that centres on employees and includes influencing, motivating and any other action involving staff (Robbins et al., 2009). It is a natural progression from the planning stage, as managers must lead in order to incorporate their plans into everyday practice. 3.2.1 Human Resource Sustainability Reversing the trend of an increasing turnover rate as noted in Item 2.6 is important for two key reasons. Firstly, it allows the organisation to maintain a collective knowledge, and secondly, a reduction in turnover rates from high to medium levels is associated with increased quality of care for patients (Castle, Engberg, & Men, 2007). This is an issue best addressed by the leading function, specifically in the area of organisational culture. It has been established that the culture of an organisation impacts work attitudes and subsequent staff turnover (Aarons & Sawitzky, 2006). By motivating employees through empowerment strategies such as increased educational opportunities as noted in Item 3.1.1, management is reinforcing a strong culture within the organisation. As an inclusive environment promotes job satisfaction (Kraal, Roosblad, & Wrench, 2009), management should ensure open communication channels exist throughout the organisation. This may involve introducing initiatives such as an internal weekly newsletter from the CEO to ensure the dialogue between management and staff continues. In order to embrace inclusivity, contributions from staff should be encouraged, to ensure the newsletter is a mechanism for both informing staff and celebrating their achievements. 3.2.2 Natural Resource Sustainability In order to reinforce the strategic importance of environmental considerations as discussed in Item 3.1.2, its inclusion in the strategic plan should be communicated to staff, actively encouraging individual employees to integrate environmental considerations into all areas of their work (Crittenden, Benn, & Dunphy, 2010). Incentives for staff in the form of grants to implement ecological sustainable work practices may stimulate innovation in this area. Whilst internal interventions move the organisation to a more environmentally sustainable future, to be a leader in this field Company X may wish to encourage environmental reform across the local healthcare industry. It is suggested that Company X facilitate the formation of an action group comprised both of staff and representatives from other healthcare providers in the region to workshop innovative practices to achieve ecologically sustainable outcomes for the local health sector. 3.

Inter-organisational dialogue can create a collaborative advantage for participating companies (Franco, 2007) and significantly improves the likelihood that the shared goal will be reached (Berger & Hinz, 2008). This initiative may prove to be a financially sustainable way of ensuring the longevity of natural resources from a healthcare providers perspective. 4. Conclusion Given the issues of limited ecological concern and deflated staff morale reported by Company Xs CEO, the goal of sustainable management requires reform to the organisations current structure and practices. Through the function of planning, Company X can revise its organisational structure to empower staff. More specifically, workforce planning is necessary to forecast future staffing requirements in order to avoid skills shortages that will impact on the organisations ability to achieve its mission. By allowing nursing students to undertake clinical placements as part of their studies, Company X is planning for and investing in its workers of tomorrow, to the benefit of itself and its community. The organisation should also use the planning function to explore the feasibility of implementing electronic healthcare records, a strategy which carries considerable ecological, financial and time savings. The leading function of management will be paramount in the organisations attempts to reverse the increasing turnover rate among staff. In order to foster an inclusive environment, the CEO should increase the communication channels within the organisation. It is suggested that an internal newsletter will increase the two-way dialogue between management and staff, whilst also recognising the valuable contributions of employees to create a strong organisational culture. Leading in the area of environmental sustainability takes on two forms and can be achieved by tackling the problem both internally and with external consultation. Grants for staff innovation relating to sustainable practices may stimulate improvement and creative thinking. Finally, by facilitating the formation of a local action group, Company X can collaborate with other organisations to work towards more sustainable outcomes for the community. This report demonstrates how the functions of planning and leading can be effectively used to encourage sustainable management in Company X. 5. Recommendations The below-mentioned recommendations are prioritised and advise on strategies involving the planning and leading functions to encourage sustainable management within Company X. 1. The organisation should increase professional development opportunities to staff (refer to Item 3.1.1, paragraph 2). 2. The CEO should immediately review the organisational structure, with an aim of empowering staff (refer to Item 3.1.1, paragraph 2). 3. The CEO should increase transparency between management and staff by utilising inclusive communication channels such as an internal newsletter (refer to Item 3.1.1, paragraph 2).

4. The organisation should engage in workforce planning and invest in future staff by facilitating clinical placements for nursing students (refer to Item 3.1.1, paragraph 3) 5. The organisation should undertake a feasibility study to ascertain the viability of the implementation of electronic healthcare records (refer to Item 3.1.2, paragraph 2). 4.

5.

6. References

Aarons, G. A., & Sawitzky, A. C. (2006). Organizational Climate Partially Mediates the Effect of Culture on Work Attitudes and Staff Turnover in Mental Health Services. Administration and Policy in Mental Health and Mental Health Services Research, Vol. 33, No. 3 , 289 301. Berger, S., & Hinz, O. (2008). The Impact of Social Networks on Inter-Organisational Effectiveness - The Case of IPO Deal Networks. Frankfurt am Main: Univerity of Frankfurt. Bryson, J. (2010). The Future of Public and Nonprofit Strategic Planning in the United States. Public Administration Review, Iss. 70 , 255 267. Callaghan, M. (2003). Nursing morale: what is it like and why? Journal of Advanced Nursing, Vol. 42, No. 1 , 82 - 89. Castle, N. G., Engberg, J., & Men, A. (2007). Nursing Home Staff Turnover: Impact on Nursing Home Compare Quality Measures. The Gerontologist, Vol. 47, No. 5 , 650 - 661. Collins, K., Jones, M., Mcdonnell, A., & Read, S. (2000). Do new roles contribute to job satisfaction and retention of staff in nursing and professions allied to medicine? Journal of Nursing Management, Vol. 8, No. 1 , 3 - 12. Crittenden, P., Benn, S., & Dunphy, D. (2010). Learning and Change for Sustainability at Yarra Valley Water: A Case Study. New South Wales: Macquarie University. Fayol, H. (1916). Industrial and General Administration. Paris: Dunod. Fells, M. J. (2000). Fayol stands the test of time. Journal of Management History (Archive), Vol. 6, No. 8 , 345 - 360. Franco, L. A. (2007). Facilitating Collaboration with Problem Structuring Methods: A Case Study of an Inter-Organisational Construction Partnership. Group Decision and Negotiation, Iss. 17, No. 4 , 267 - 286. Gilbody, S., Cahill, J., Barkham, M., Richards, D., Bee, P., & Glanville, J. (2006). Can we improve the morale of staff working in psychiatric units? A systematic review. Journal of Mental Health, Vol. 15, No. 1 , 7 - 17. Human Capital Alliance. (2005). Report to Department of Human Services: Recruitment & Retention of Allied Health Professionals in Victoria - A Literature Review. Human Capital Alliance. Kraal, K., Roosblad, J., & Wrench, J. (2009). Equal Opportunities and Ethnic Inequality in European Labour Markets. Amsterdam: Amsterdam University Press. Mayer, S. J. (2008). Strategic Human Resource Management: Practices of High Performance Organizations. Innovative Human Dynamics , 1 - 4. 6.

Robbins, S., Bergman, R., Stagg, I., & Coulter, M. (2009). In Management 5 (p. 64). Frenchs Forest: Pearson Education Australia. Velte, T., Velte, A., & Elsenpeter, R. (2008). Green IT: Reduce your information system's environmental impact while adding to the bottom line. New York: McGraw-Hill Osborne Media. Victorian Government. (2005). Productivity Commission Study into the Health Workforce: Victorian Government Submission. Melbourne: Victorian Government, Department of Human Services.

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