Central Hospital was a community hospital affiliated with Integrated Health, a large, private, nonprofit healthcare system in Tempe, Arizona. Integrated Health consisted of four community hospitals located within a 75-mile radius, Three long-term care facilities, a heart institute, a cancer treatment center, two graduated care retirement facilities, a hospital services company, and a health maintenance organization. Integrated's Board of Directors decided to implement the MAR in stages. In the first stage, the MAR system would be developed and implemented at Central Hospital. After the problems were worked out, the MAR would be implemented throughout other facilities of Integrated Health. Responsibility for the MAR project was delegated to the MIS department at Central, and today it seemed to rest squarely on Kate's shoulders. The pharmacists saw the MAR as the logical extension of the computerized order entry function that they had been using for four years. In the entry function, the pharmacist reads the physician's order for a specific patient and enters it into the computer. Pharmacists anticipated some initial problems but knew from experience that most issues could be solved. Pharmacists equated the MAR development and implementation process to growing pains, while nurses saw it as unnecessary. To the pharmacists, the computerized MAR was a tool to reduce work, errors, and time spent entering orders. This time could be better spent on more rewarding clinical and professional activities. In general, pharmacists saw computerization as the only option, and most were used to change. The profession had evolved from compounding and dispensing drugs to patient education, drug information services, and pharmacokinetics consultations. New drugs emerged weekly, especially biotech and genetically engineered drugs, so change was expected. Guy Smith, who developed the pharmacy subsystem, was asked about the feasibility of the implementation date. After reviewing the screens and hearing the concerns of the nurses, Guy thought that the target date was too ambitious. Lauren Hill, the nurse trainer, thought that the nurses would not be ready to use the system in 12 months. She just did not see how she could train Central's MID-member nursing staff in the time available. Kate Cohen thought the screen modifications and programming changes requested by the nurses could take between nine and 12 months. However, Art Baxter rejected the advice of Guy, Lauren, and Kate and refused to change the implementation date. Kate and Guy tested the MAR at every phase of development. During testing, only a few users were on the system at one time. As many scenarios as possible were tried during each test. However, because of the large number of possible combinations, everything did not come up for review. Corrections were made as soon as glitches were identified. As a follow-up, Ben Hoffman, the internal auditor, conducted a test of the full system a month before the scheduled implementation date. User training for nurses began about three months before the target implementation date for the MAR. Lauren Hill, the nurse trainer, was responsible for teaching 400 nurses everything they needed to know about online MAR charting. She thought the training had gone well and had patterned the nurses' training after the training for the pharmacy department's computerized entry function. The training plan included a pre-test, an online demonstration, and a post-test. In order to accommodate all the nurses in such a short timeframe, the class sizes were large. The class size for the pharmacists had been small since there were only 20 pharmacists. During the training, the nurses complained that the screens were too cluttered, and they became more and more frustrated with the user-unfriendly screens. Another frequent complaint expressed by nurses was that the screens were difficult to read. There was nothing on the screens that stood out to direct the eye to a specific function. In order to complete a transaction, multiple screens were required, and frequently the system response time to move from one screen to another seemed too slow. There were times when the information from the nursing subsystem did not synchronize with the pharmacy subsystem. Another frequently voiced concern was the lack of available computer terminals on which to enter the data and the distances from the patient's room. About four months after Kate and her team had begun work on the MAR project, reorganization at Central Hospital was announced (See Exhibit 1 and Exhibit 2]. Greg Korensky, vice president of operations, was moved into a newly created position of executive vice president. Greg would have responsibility for coordinating operations across the Integrated Health system rather than just at Central Hospital. In another important change, Food and Nutrition and Pharmacy Services would become part of the Nursing division. The jobs of the chief operating officer, the director of nursing, and the hospital operations administrator were eliminated as part of the restructuring. The positions held by the director of nursing and the hospital operations administrator were combined into a single position of vice president of patient care services. Exhibit 1. Partial Organization Chart for Central Hospital before the Reorganization Hospital Administrator (CEO) Physicians Chief Operating Internal Audit Officer (Ben Hoffman) (Jim Hart) MIS Nursing Hospital (Jane Ritchie) (Art Baxter) Operations (Joyce Kilmer) (Kate Cohen) (Nancy Patel) (Lauren Hill) Pharmacy (Guy Smith) DetailsExhibit 2. Partial Organization Chart for Central Hospital after the Reorganization Hospital Administrator (CEO) Physicians Executive Vice-President Internal Audit (Ben Hoffman) (Greg Korensky) MIS Patient Care (Art Baxter) Services (Kate Cohen) (Sharon Green, Vice-President) Nursing (Joyce Kilmer) Pharmacy (Lauren Hill) (Guy Smith)After a six-month search, Sharon Green joined Central Hospital as the vice president ofpatient care services. She quickly became an enthusiastic supporter of the MAR project. However, Sharon was out of town on the day the MAR was implemented, clue to being on vacation. On Monday, the MAR was implemented and immediately failed. Floor nurses and staff pharmacists complained that the MAR was too complicated, then physicians expressed concern about patient safety, and next the computer system crashed. Therefore, the MAR project was suspended, and Kate's team assembled late yesterday afternoon to review the failure. On Tuesday, at 2:00 P.M., Kate would present to the hospital's management. Kate wondered what she was going to say. 1. What were the problems MAR attempted to solve? How should these problems be dened? Were there symptoms associated with these problems? 2. What were the major reasons the implementation of MAR failed? (focus on root causes of problems} 3. Based on the types of culture described in section 11.2. what type of culture existed at Central Hospital? (Remember the integrated cases incorporate several chapters) 4. What type of decision making was utilized by Central Hospital? Did any one or any group exhibit throughout the MAR project? 4. What elements of successful change management existed and which ones were absent in the MAR project and implementation? {sections 12.2, 12.6, 12.7) 5. What impact do you think the changes in organization structure and responsibilities had on the implementation of MAR? Why? Regulatory and competitive changes in the healthcare industry resulted in a more complex and dynamic environment. According to the National Coalition on Healthcare, the United States spent $1.9 trillion on healthcare per year, of which $450 billion were administrative costs. At Integrated Health, administrative costs rose at an annual rate of six percent, and the board's strategy to reduce administrative costs began with the MAR. As the trend in insurance coverage shifted from indemnity plans to managed care and capitation, insurers required that healthcare providers document services in a timely, accurate manner. Paper charts or records were the traditional method of reporting information. The need to deliver more information in shorter time periods resulted in paper reporting not being an efficient or effective method of delivering this data to insurers. For use within the healthcare system, paper charts must be physically transferred from one department to another as patients move from department to department. In the industry, specialists reported that patients referred to them ended up without a paper file 30 percent of the time. Moreover, it was reported that lost paperwork or illegible handwriting resulted in 10 to 15 percent of patients' medical tests being repeated unnecessarily. Integrated's management learned that private insurance companies, Medicare and Medicaid would soon require electronic transfer of patient information on treatment, medication, surgical procedure reports, and billing information. This information would be collected in a centralized database and then uploaded to the computers of the insurers. Computerized records were retrievable by those who need access to patient information in order to provide services or to process requests for payment. Electronic transfer of all information was expected to become a requirement in the future. One aspect of patient information that lends itself to computerization from both clinical and data collection perspectives was medication charting. Like most other healthcare systems, Integrated was trying to adjust and position itself for the changes and challenges that managed healthcare would bring. Integrated's management viewed the move to a system such as MAR as one of many business process changes necessary if the system was going to be competitive in the long term. For example, if the MAR project was successful, most billing functions could be completed on the day of service. Therefore, the hospital could receive payment more quickly with the utilization of fewer resources. Ultimately, the MAR could eliminate the need for most of the manual billing and allow for staff reductions. For years, Integrated Health had invested little money in information technology. Instead of utilizing the power of technology, the company had relied on old-fashioned paper records held in rows of filing cabinets. lCentral's computer system was still primarily a mainframe system that some staff considered antiquated, and hardware limitations resulted in cumbersome applications for several clinical departments. Art Baxter, the chief information ofcer at Central Hospital, decided to computerize the MAR over a one-year period. Art heard rumors of a management shakeup at Central Hospital but thought MIS would not be affected. Completing the MAR in such a short period of time would definitely improve Art's image. Art, a former plumbing supply salesperson, lacked a technical background in M18 and was known to boast about not knowing how to turn on a computer. Art's cousin was a member of Central's Board of Directors. Art assigned Kate Cohen as project leader of the MAR. Kate was known as one of the better programmer/analysts at Central, and she was given day-to-dav operational responsibility for the MAR project. Art told Kate that except for monthly executive updates and critical decisions he would not be involved with the project. Kate assembled a project management team consisting of Guy Smith, pharmacy operations coordinator and M18 liaison; Lauren Hill, nurse trainer and M18 liaison; and Ben Hoffman from Internal Audit. Kate developed good working relationships with Guy and Lauren, who represented two departments critical to the success of this project. Guy Smith had experience developing and implementing the computerized order entry system used in Pharmacy Services for four years. Guy personally developed most of the user applications for the order entry system. Kate felt he would be an asset in developing MAR user applications. Lauren Hill was often referred to as \"Super Trainer\" because of her ability to train even the most difficult employee. Ben Hoffman was an expert on accounting information systems; he had been at Central Hospital for a short time, and the computerized MAR was his first major project. Additional representatives from MIS, Nursing Services, Pharmacy, Internal Audit, Accounting, and other areas of the hospital served on the team on an as needed basis. For Kate Cohen and other MIS employees, the MAR project was a chance to create a good impression. Therefore, the attitude of the MIS staff was generally positive. If the MAR was successfully developed and implemented at Central, Kate might be asked to lead the MAR project across Integrated Health. The MIS staff viewed the MAR project as an opportunity to demonstrate their importance to Integrated Health. With the pressure on healthcare providers to hold down costs, the MIS staff thought that the project was a chance to prove their value to the organization and protect them from a layoff. Men the MAR implementation target date was 12 months away, the team assembled and developed an action plan. Software preparation began in earnest; and after about three months, Kate and Guy finished the coding work on roughly one-third of the user screens. In the fourth month, several demonstrations of the software and available reports were offered to physicians. However, physician turnout to the demonstrations was poor. At first, Kate thought low turnout indicated a low level of interest. Later Kate concluded that the low turnout was not necessarily a bad sign for the team, given physicians' busy schedules. The team members worked well with each other. In the early stages of the project, the team met at least twice every month to review progress and make new assignments. Communication flowed freely between the team and two of the ultimate end usersthe pharmacy and the billing department. However, not much information seemed to pass between the team and other end users of the MAR such as nursing. Jane Ritchie, the director of nursing, did not support the change to the MAR system. Jane was more comfortable with doing work the traditional way, and she rarely accepted change without noticeable resistance. Jane felt that the nurses had only limited information about the MAR project and that the benefits of the MAR were unclear. Furthermore, an undercurrent of antagonism surfaced between Jane and Art because of the nurses' frustration over the MAR proiect. The nursing staff at Central was considered critical to the success of the MAR project. Nurses would be responsible for entering over 50 percent of the data, and the MAR project would create a significant addition to their heavy workload. Occasionally, during development, the nurses were asked for their input. Approximately half of their suggestions and requests could not be accommodated due to coding issues or to limits on computer capability. Generally, the nurses felt their suggestions and recommendations were rejected without full explanation. Members of the nursing staff and M18 met several times to assess whether or not implementing the computerized MAR in 12 months was achievable