Rakesh and Gagan were two brothers who had graduate in Medicine in the year 1979. Both

established themselves as successful practitioners. In 1992, they decided to set up their own hospital

as both were familiar with the nitty-gritty of the profession after spending a decade as successful

practitioners. In the year 1994, the concept was concretized when three floors Arogya Hospital with a

bed capacity of 60 came into existence at Gwalior. The facilities provided by the hospital were

pathology, X-ray, blood bank and ICU. In the year 1998, the number of beds were increased to 100

with the addition of a fourth floor. In the year 2005, a fifth floor was added and the hospital started

offering services like radiology, 3D spiral, C. Tscan, colourdoppler, pathology, blood bank, C.C.U.,

O.T., maternity unit, emergency and trauma services, in-patient accommodation, canteen,

telecommunication and entertainment.

The hospital had 35 nurses and 55 class four employees. The main task of the class four

employees was to maintain the cleanliness of the hospital. Besides this, they were also entrusted with

the task of sponging, bed setting and shifting of the patients. Salary paid to these employees was

between Rs. 1200/- to Rs. 1800/- per month. The hospital staff was divided into different classes of

employees. Class one comprised of MBBS, MD, MS, and Administrative Officers. Class three

comprised of Technicians and Nurses. Class four comprised of Ayabais, Sweepers and Guards.

Hospital had 11 full time doctors, out of whom 7 were duty doctors (MBBS), 2 full time MD for ICU

and 2 full time in-house surgeons (MS). Besides this, the hospital had 50 visiting doctors who

operated on a turnkey basis. These doctors had their own clinics in different parts of the city and as

per requirement, they admitted their patents in the hospital. There was a mutual agreement between

the doctors and the hospital that the hospital would charge the patients and out of it the doctors would

receive their fees along with a percentage from the hospital share. The patients treated by the hospital

were patients requiring intensive care and minor illnesses. Out of the cases reported in the hospital,

60-75% were maternity and were referred to the hospital by leading gynaecologists of the city, Dr.

Savita and Dr. Manorama. To help the doctors in the treatment of patients, work-instructions for

Resident Doctors, Supervisors, Wardboys / Ayabais and Sweeper boys/ bais were prepared by the

newly appointed Hospital-Administrator Priya. These instructions were prepared in English and were

hung on the walls of the enquiry counter. After a span of one month, Priya resigned from the hospital

on account of some personal reasons.

By the end of the year 2004, Ritu, a fresh post-graduate in Hospital-Administration from

Gwalior, was appointed as an Administrative Officer or take charge of the overall activities of the

hospital. Her role was to monitor the activities of employees of class three and four and various other

activities related to the functioning of the Hospital. The first task before her was to improve the

cleanliness of the hospital. She found that the toilets were not cleaned properly and the room hygiene

was dismal. She started making regular visits to all the wards and rooms in the hospital to observe and

monitor the employees lacked a human touch. To add to this, the patients also complained that the

employees demanded money for the services. After analyzing the situation, she came to the

conclusion that lack of motivation among the class four employees was one of the major factors

responsible for the pathetic condition prevailing in the hospital. Lack of motivation among the class

four employees was also visible in the form of high employee turnover, work negligence, absenteeism

and complaining behaviour. High absenteeism among the class four employees resulted in work

overload for sincere employees, as they were forced to work in the next shift. This was a regular

feature in the hospital as a result of which employees often remained stressed and therefore, less

committed towards their work. Although, they were being provided with dinner and snacks at theexpense of the hospital, as a gesture of goodwill for those who worked over time for the hospital. She

also found that the workers were not reporting for their duty on time, despite their arrival in the

hospital on time.

The second reason, which she identified for lack of hygienic condition in the hospital was that the

visiting hours for the visitors were not specified, so there was a continuous flow of visitors round the

clock, which hampered and affected the cleaning activity of the hospital. It was found that the

patients rooms were always full of visitors who would not mind taking their meals in the room/ward.

She felt that there was no solution to visitorss problem, as this was an integral part of the

promotional strategy of the management. She also found that the work-instructions given to the

hospital-staff was in English language and it was difficult for class four employees to understand

them. Ritu translated all these instructions in Hindi so that class four employees could understand and

implement them.

Ritu had the daunting task to reduce the absenteeism and make the employees more committed to

their work and felt that a reward of Rs. 200, if given to an employee who remained present for 31

days could perhaps motivate the employee to remain regular at the work place. Further, to motivate to

perform, she decided to systematize the performance appraisal system by identifying performers and

non-performers. This being her first job, she was apprehensive about performance appraisal. The

employees were to be classified into three groups A, B and C, A was for high performers, B was

for average performers and C was for poor performers. It was decided that the employees in the

grade A would receive the highest increment followed by B and C. To make the performance

appraisal objective, she identified various activities on which the employees could be appraised. To

make the performance appraisal system more objective, a two-tier appraisal system was developed by

her. In the first phase, the employees were to be rated regularly on the identified activities by patients

and their attendants. In the second phase, observation of doctors and nurses was to be considered.

Although Ritu had full cooperation from the hospital management, yet she was apprehensive about

the employee acceptance of the new system. She had to wait and watch.

1. Critically evaluate the factors identified by Ritu for enhancing organizational effectiveness?

2. Describe a performance appraisal system that you will recommend to Ritu for evaluating the

employees?