Fromter's Hospital's Organizational Challenge Fromter's Hospital was facing a serious financial hardship as healthcare costs continued to spiral out of control and reimbursement plummeted. A new Chief Executive Officer (CEO) was hired to turn things around in an effort to salvage the hospital. The CEO was determined to change the company culture, which he identified as apathetic and accustomed to mediocrity. He noted that the financial performance was suffering and attributed much of this to a variety of process issues as well as a lack of focus on the core business of patient care. The CEO immediately took action to look at financial issues and cut costs. A drastic cost and labour reduction strategy was implemented with an aggressive timeline to turn the financial bottom line around. Within a few months, the hospital started to show less of a financial loss and things seemed to stabilize financially. However, the morale of the staff had taken a significant hit. Turnover increased as a sense of job security decreased, and the impact on the patients began to be seen in an increase in patient complaints and lowered patient satisfaction scores. A training program was introduced to remind employees about customer service but this had no impact on results. (a) Based on your knowledge about effective change management, identify the mistakes made by the new CEO in his efforts to change the organizational culture of Fromter's Hospital. (10 marks)

(b) Analyze the current situation at Fromter's Hospital and determine the most appropriate leadership behaviour(s) to utilize. Justify your selection by identifying the follower and organizational characteristics that informed your decision. (15 marks)