Gateway Hospital is a 500-bed tertiary-care hospital located in a busy metropolitan area. A recent employee satisfaction survey scored well below the national norms on most scales. The hospital has been facing higher than average turnover and vacancy rates. Recruitment of professional positions is very difficult because the hospital has gained a reputation as a bad place to work, especially if one is new; the term eat their young seems to be a prevalent description. Salaries are below the local market, as are annual pay increases. In many departments there seems to be a critical shortage of staff, and closing services has been a recent topic of discussion. Additionally, the financial picture of the organization is bleak. The payor mix has changed; Medicare cutbacks are impacting the bottom line, as are changes in private insurance funding. Key physicians are beginning to take their services elsewhere, as they sense the inefficiency of the hospital processes.

The various stresses appear to be having a significant impact on the overall morale of employees.

Poor teamwork is rampant, and communication breakdowns seem to be a normal occurrence. Several leaders have been let go in an effort to address issues. The leadership of Gateway Hospital is extremely concerned about the organizational prognosis and has decided to begin to address the issues by enlisting the assistance of a consulting team. One member of the team is a financial expert who has been hired to address the significant financial issues affecting the hospital. The time frame on fixing the financial issues is one of a critical need; since the environment is rapidly changing, the consultant must get a handle on how to help the hospital operate successfully, given the current financial downslide.

A second member of the team is hired to address the morale and employee issues. A review of the employee opinion survey is conducted, and trends are identified in exit interviews. Employee interviews and focus groups are held in an attempt to determine the root cause of the morale issues, as well as the breakdown in teamwork and communication.

The data collection is discussed with leadership; after a series of discussions, leadership admits that many of the financial pressures have created a knee jerk reaction to staffing issues, often cutting back dramatically on employee hours. This would create a crisis mode and the need to ask employees to work harder. This cycle has created a significant lack of trust from the employees perspective, coupled with the fact that employees have not felt that they have been apprised of the reasons for the roller coaster changes and have not been offered any words of appreciation when they have either reduced their hours or worked in a crisis. The consultant and the leadership agree that in order to fix the people issues of the organization, there will need to be a culture shift of leadership and employee interactions so that a trust can be rebuilt.

1. What experience do you have with organizational change? Did the leadership team of your organization manage the change successfully so that the change was seamless, met the organizational goals and all employees embraced the change?

2. Given the issues relayed in the case study, what Organizational Development interventions do you think should be utilized to address the problems the hospital is facing?

3. What skill set do you think the practitioner will need in order to be effective in this organization?

4. Which of Palmer, Dunford, and Akins barriers to change do you think the hospital will face while trying to turn things around?