Most Swedes and Britons begin to suspect, after many hours spent in crowded waiting rooms, that their health service does not work very well. This would be surprising if it was not so familiar because the patient is ostensibly the hospital's client. In any normal company the client is being constantly courted and pam- pered because if he is dissatisfied he may not return. Can you imagine a lecturer at a medical school impressing upon his students the principle that 'the customer', i.e. the patient, 'is always right'?
It is very hard for a patient in a hospital to feel he is being treated as a very important person - as the client without whom the company or organisation could not prosper. A visitor to a hospital soon realises that the most important person around is not the patient/client but the doctor.
The whole organisation of the hospital and the rhythm of its working day are built around the doctors. They take all the important medical decisions and if for some reason they are unable to function, perhaps because of illness or overwork, the rest of the organisation tends to grind to a halt. And in a general hospital there are emergency cases to deal with. When the ambulance arrives, blue lights flashing, the 'flu patients just have to wait.
There is very little the hospital personnel can do about it. They need to keep a 'stock' of patients in the waiting room to ensure that not a minute of the over- worked doctor's precious time is wasted. Because of a chronic shortage of both money and doctors the surgeries are under-staffed. Since the doctor is the only
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MANGING KNOWHOWone allowed to make a diagnosis, even when the case seems clear, everyone - patients and support staff alike - are forced to dance to the doctor's tune.
Production is the top priority in hospitals and in most other public bodies.
The aim is to maximise production efficiency i.e. the throughput of patients.
Hospitals demonstrate very clearly what happens in a knowhow company when the management, instead of concentrating on solving the problems of indi- vidual clients, gives the highest priority to 'production'. When production is the imperative, the producer - in this case the doctor - must perforce be king. The hospital's business idea demands it.
The almost god-like quality of the doctor is reinforced by the fact that one very rarely sees him. Within Swedish health care to-day there are about 15, 000 doctors and almost 300, 000 other personnel. To put it another way there are upwards of 20 nurses, cleaners, cooks, technicians, receptionists and secretaries for each doctor. There is a 95% chance that the next person you see in a hospital will not be a doctor.
The people the patient encounters most frequently are usually the ones with lowest status - the clerical assistants and cleaners. Status in a hospital is deter- mined entirely by the level of medical knowhow. The patient is generally the least knowledgeable in this area and so he or she, the hospital's client, is required to sit 'patiently' and respectfully on the bottom rung of the status ladder.
The specialisation of the Swedish medical profession into discrete knowhow areas began more than 200 years ago when what was then the largest hospital in Sweden was divided into one medical and one surgical clinic. To-day, in the big hospitals, there are at least 40 different specialities. Each doctor has medical responsibility for his patients and each consultant takes overall responsibility in his district or hospital for his own specialist area.
But this organised, coherent and rigid medical/productive hierarchy is in sharp contrast to the equivocation and illogicality of the administrative/
managerial structures common in most hospitals and health services.
The chief physicians have budgets - discretion to spend - amounting to tens of millions of pounds per head. They have the right to prescribe treatment, employ expensive diagnostic equipment, order admissions, refer to specialists, instruct staff' and make a host of other decisions, almost all of which involve spending of some kind or another.
And yet their responsibilities are in no way comparable to those of private sector managers. The doctor is not allowed to recruit his own personnel, even though staff costs account for about 70% of his budget. Senior physicians cannot even order the hiring of temporary personnel during holiday periods. Such matters are in the hands of the personnel department of the hospital.
This lack of managerial discretion does not bother the doctors at all. They like it that way. Since work of this kind involves mostly low status paper- pushing they are more than happy to leave it to others. In his heart of hearts the doctor scorns mere management. The uncompromisingly elitist attitude of doctors is exemplified in their unofficial oath of professional allegiance: 'No-one spends seven years at medical school to become an administrator.'
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The result of this widespread prejudice is that doctors and the hospital's administrators are in a state of more or less permanent war with each other. The doctors feel hounded by paperwork and hobbled by bureaucratic rules and regulations. The administrators, hounded in their turn by politicians and civil servants to reduce costs, are constantly frustrated in their search for efficiency and economy by doctors who know little and care less about the economics' of health care. The tension is the opposite of constructive. The administrators have the responsibility for efficiency and cost-effectiveness but no power to improve either; the doctors, who have the power, have neither the responsibility nor the inclination to prefer the 'cheap' solution to a medical problem.
Dual expertise in hospitals is everywhere conspicuous by its absence. The doctors have no education in and no appetite for business administration and the managers know precious little about medicine. There is no common ground- no meeting place. And the incessant conflict between the two opposing camps pre- cludes any possibility that some accommodation, in the form of an effective col- lective leadership, might be reached.
The situation is further aggravated by the fact that doctors, despite their heavy responsibilities, are not allowed to take investment decisions either. This is the prerogative of politicians chairing committees on which the doctors sel- dom have more than token representation.
The dilemma for the administrators and politicians is that they have no means of control other than by written rules, regulations and systems most of which the doctors find exceedingly irksome. The administrators, hungry for power, try to ensure every decision of 'importance' is taken by one of their members. This is why the personnel department tries to take recruitment away from the doctors and why the politicians claim the right to take investment decisions which should really be the responsibility of the specialists.
In these circumstances it is not surprising that the administrative staff in Swedish hospitals has outgrown the professionals. According to one investi- gation the number of administrative personnel grew by 7.7% between 1974 and 1981, whereas total employment in hospitals increased by only 5.7%. The Swedish hospitals are caught in a typical dilemma for knowhow organisations - the dual expertise problem. The professional and the organisational manage- ments are distinct from and deeply suspicious of each other.
Modern hospitals appear from the outside to be rather typical 'factories'. The priority is production and the organisational style is industrial. The pro- fessionals, who play the role of expensive machines around which the production process is designed, have power within the system but no power to change it.
But internally hospitals are typical knowhow organisations. Those with the highest knowhow level have the highest status. In fact knowhow orientation in hospitals is extremely strong- there are even sharp divisions between the various specialities. One finds in hospitals islands of expertise, equivalent to what we call 'pro-teams', consisting of groups of highly qualified specialists (surgical units for example) which work together with great skill, dedication and efficiency.
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MANGING KNOWHOWBut they are always isolated. It is rare for their professionalism to infect the rest of the organisation.
How did it get like this? Why has the client/patient, who in a normal business would be at the centre of things, been relegated to the role of raw material, of less consequence than the humblest cleaner? One answer is that hospitals in Britain and Sweden are monopolies. Dissatisfied customers cannot go elsewhere. Another answer is that the state, in its caring wisdom, has robbed the patient of the essential client prerogative - the right to pay or withold the fee.
PUTTING KNOWHOW COMPANIES TO WORK