Understand how managers appraise staff performance

Learning Objectives
A company is only as good as the people it keeps.
Mary Kay Ash, entrepreneur and businesswoman
Studying this chapter will help you to
➤ explain how managers develop staff,
➤ understand how managers appraise staff performance,
➤ describe how managers compensate staff,
➤ explain how managers protect staff, and
➤ understand how onboarding improves staff retention.
Copyright 2019. Health Administration Press.
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186 Management of Healthcare Organizations
When implementing their new strategic goals, managers at Partners HealthCare performed the staffing function. This function enabled Partners to obtain new workers
and retain existing ones. An essential part of staffing was to determine the financial
compensation for each position and employee. Compensation included base pay,
incentives, and bonuses, as well as benefits such as paid vacation days, health insurance, and retirement plan contributions. In making compensation decisions, managers
had to figure out what compensation would be needed to obtain and then retain the
people Partners wanted. Managers had to understand and comply with dozens of laws
regulating compensation and other aspects of employment. They also had to decide
how to evaluate staff job performance and how performance evaluations would affect
future compensation. Partners HealthCare’s strategic goals were going to require
innovation and change, so managers knew they would have to develop employees
through training, coaching, and mentoring for changes in their jobs. Through these
and other staffing processes, managers were able to achieve ambitious goals and
the Partners HealthCare mission.
As we see in the opening Here’s What Happened, staffing a healthcare organization
(HCO) is complex and requires much thought by managers. Staffing is another
way managers make a difference and add value to their HCO. Chapter 7 identified seven staffing processes and explained the first three, which are used to obtain workers.
This chapter builds on that discussion and studies the other four staffing processes, which
help to retain workers: developing staff, appraising staff, compensating staff, and protecting
staff. The processes overlap to some extent because they are interconnected and because
some processes support both obtaining and retaining workers. This chapter concludes with
a discussion of onboarding, which combines several staffing processes to improve retention of new employees. If an HCO’s managers perform these seven staffing processes well,
they can obtain and retain the workforce needed to succeed. Employees will not wonder,
“Should I stay or should I go?”
These seven processes can also improve employee engagement. Employees engage
when they are emotionally committed and actively contribute to their work, workplace,
and organization goals (Dye 2017). Employee engagement is an important challenge
for organizations, including HCOs. Opinion surveys have shown that overall employee
engagement in work is low and declining (Dye 2017). As a result, many concerned businesses are improving the “employee experience” by increasing training and development;
expanding compensation and rewards; and improving employees’ physical, mental, and
financial well-being (Schawbel 2016). Learn to do the staffing processes well so you can
engage your HCO’s employees in their work, which will in turn help people in the community live healthier lives.
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Chapter 8: Staffing: Retaining Employees 187
Developing Staff
In chapter 7, we defined developing staff as helping employees acquire new knowledge, skills,
attitudes, behaviors, and competencies for current and future jobs. (Continuous learning, talent development, and other terms are also used.) Staff development is done through training,
coaching, mentoring, job rotation, formal education, and other methods. Managers must
develop employees to motivate them, help them feel competent, enable them to succeed
in their jobs, and give them opportunities to grow (McConnell 2018). Employees need
development to continually perform their jobs well; some employees need it on their first
day of work. Accreditation and professional licensure standards also require training and
continuing education. Training, coaching, mentoring, and other approaches to developing staff enable HCOs and their workers to adapt to changes in the external environment
(e.g., the changes described in chapter 1). If an HCO does not prepare workers for those
changes, the organization and its workers will quickly fall behind because the half-life of
learned skills is only five years (Schawbel 2017). Besides developing workers for current
jobs, HCOs should also develop staff for future promotion and transfer to other jobs that
help them grow and succeed. Do you see how this can improve staff retention?
Despite these reasons for staff development, some HCOs spend inadequate time and
funds on it. White and Griffith (2019) urge managers to view training and development as
an investment in the organization’s workforce rather than a costly expense. Better HCOs
invest to enable employees to perform work according to the HCO’s preferred methods,
meet service standards (e.g., empathy and responsiveness), and feel supported.
We will first study orientation of newly hired employees to help them successfully
begin working. Then we will consider how to develop all employees so they can improve
their performance and prepare for growth and promotion.
Orientation of New Staff
After a manager hires a new employee to work in her department, she (and her HCO) then
must orient the new employee to the department and the HCO. How well the orientation
is done (or not done) will strongly shape the new employee’s perceptions and feelings about
her job, her coworkers, and the HCO, as well as her decision whether to stay in the job.
Orientation of new staff should focus on both the technical aspects of work (how to do the job
well) and the social aspects of work (how to fit in and get along with coworkers). Managers
must orient new workers to help them succeed—which then helps the managers succeed.
HCOs differ in how they handle orientation of new staff (Kaye and Fottler 2015).
At some HCOs, orientation may start online after workers have accepted a job but before
they begin their first day of work. Smaller HCOs may provide a shorter, more casual, and
less organized orientation than big HCOs do. New, start-up HCOs may not yet have a
planned orientation, and new workers will become oriented day by day. In large HCOs,
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188 Management of Healthcare Organizations
orientation might be part of a comprehensive, months-long onboarding process (described
at the end of this chapter). Top managers orient all new employees to the HCO. Middleand lower-level managers orient their new employees to their specific work departments.
They might use videos, online tutorials, webinars, e-handbooks, online manuals, interactive
meetings, mobile learning, buddies, mentors, and checklists.
Managers are likely to spread employee orientation over several days (or even weeks)
so that new workers are not overloaded with information. For example, suppose Juan, the
reimbursement manager at a healthcare system in Berkeley, hires Erin as a Medicare reimbursement specialist. Juan and the human resources (HR) department arrange for Erin to
complete her payroll forms, enroll in the health insurance plan, and buy a company parking permit online, all before her first day of work. Juan then schedules time to orient Erin
to the reimbursement department when she arrives there on her first day of work. Erin’s
department orientation includes
â—† a gracious, supportive, and enthusiastic welcome to the healthcare system and
the department;
â—† introductions to her supervisor and a few immediate coworkers;
â—† a tour of the work area, department, and places such as restrooms and break
◆ specifics of the Medicare reimbursement specialist job—what, why, when,
where, and how to do it the way Juan expects it to be done (which might
differ from how Erin has done similar work elsewhere);
â—† information about work schedules, breaks, meals, and overtime;
â—† information about her workstation, equipment, and supplies;
â—† an explanation of essential policies, procedures, rules, and standards of
behavior—especially those that pertain to the department (rather than to the
entire HCO); and
◆ helpful, supportive answers to Erin’s questions.
Juan and Erin then meet with Carla (an experienced reimbursement specialist), who
will be Erin’s mentor or buddy. Carla and Juan have already discussed this arrangement,
and Carla has agreed to provide on-the-job guidance to Erin and help Erin socialize with
others. Juan will talk with Erin at the end of her first day and during her first week to see
how she is doing. He will gradually introduce her to further information to help her do
her job well and become more engaged.
At some point Erin will participate in orientation to the whole organization. Whereas
department orientation should begin the day an employee begins, organization orientation
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Chapter 8: Staffing: Retaining Employees 189
can be done later. Much of it is information that may be distributed via multimedia in
small doses over a period of time. Most organizations include some “meet and greet” time
with the HCO’s senior leaders, perhaps on the first day of each month. Returning to the
example in Berkeley, the HCO’s top managers and HR staff may welcome Erin and 16
other new employees from 9 different departments who started the previous month. They
may describe the healthcare system’s mission, vision, values, and goals and give inspired
messages about the HCO. Staff may describe or provide multimedia presentations on
â—† the organization chart and management team;
â—† essential policies, procedures, rules, and standards of behavior that pertain to
all employees, such as those related to safety and customer interactions; and
â—† employee benefits, career-planning resources, and other support that is
available to all workers.
After an hour of organization orientation, new employees should be better informed but
often are restless. Break time! Snacks are provided, people chat informally, and new employees
meet and socialize. Some HCOs may then include a brief tour of the facility.
In the real world, managers sometimes struggle for weeks or even months to keep a
department going while a job is vacant. People work extra days to cover the job’s tasks until
a new employee begins. When a new employee finally arrives, everyone wants her to jump
right in and get to work. The manager should resist a quick “Here’s what I want you to do”
orientation. A new employee will have questions and feel anxious about the new job, new
place, new people, and so forth. She will feel supported—or not—depending on how her
first day goes. The first day, first week, and first month will greatly affect how well the new
employee does her job and how she feels about her job and the organization. Without an
adequate, supportive orientation, she may soon be wondering, “Should I stay or should I
go?” If she goes, then the manager, department, and HCO have to redo the hiring process.
As a manager, remember: Employee orientation improves employee engagement and satisfaction—which then improves employee performance and retention. For the employee,
manager, department, and organization, it’s a win-win-win-win!
Training Staff
Although employees might have graduated with the latest knowledge and skills or might
have years of experience, their knowledge will not be “best practice” forever. In fact, it can
become outdated within months because of rapid changes in the external environment
of HCOs. A manager must train and develop employees so that they can adapt to those
changes and stay current. Partners HealthCare did this in the chapter’s opening Here’s
What Happened. Many hospitals trained staff to better satisfy patients when Medicare
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190 Management of Healthcare Organizations
began reimbursing hospitals based partly on patients’ satisfaction scores. Many HCOs offer
training to prepare workers for developments and challenges in healthcare (some of which
we saw in chapter 1): patient engagement, patient experience, clinical care coordination,
diverse cultures and multiple generations in the workforce, burnout, bullying, interactions
with others, ethics, harassment, mobile health, population health, pay-for-performance,
disaster readiness, safety, high-performing teams, embracing change, conflict resolution,
and many others (Kaye and Fottler 2015; Ryan 2017). For example, Main Line Health in
Philadelphia has been providing all managers with two days of experiential learning about
diversity, respect, and inclusion. Similar training will be provided to all staff, including
physicians (Lynch 2017).
When you are a manager, you will have to ensure your workers are trained for their
jobs—the equipment, methods, processes, and so forth. Who provides the training? Who
trained you for a job you once had? As manager, you will do some of the training. Experts
in your department or in other departments such as information technology or infection
control will provide training for their areas of expertise. Large HCOs are likely to have a
department for education, training, and development. People in that department could
help you plan and implement training for your staff. Many HCOs outsource some training
to consultants with specific expertise, such as training in conflict resolution and teamwork.
Vendors who sell products and equipment to HCOs are responsible for training the HCOs’
employees in how to use the products and equipment.
Sometimes an HCO is in such a hurry to train staff that it does not take time to
create effective training. Good training that has a lasting effect is not simple. How can
managers prepare and provide effective training? They can use the training methods shown
in exhibit 8.1 that are based on training models. To really stick, training must be done
well—and be reinforced by leadership and organization culture, which will be studied
in later chapters.
Developing Staff
Managers should develop their staff for transfers, promotions, and career growth. This
development goes beyond training for an existing job and prepares workers for other jobs
in the HCO. Educational programs for workers, which are longer and more comprehensive than short-term training, can be planned by managers using the methods listed in
exhibit 8.1. Managers can provide internal or external coaches and mentors to help workers grow and develop for higher-level jobs and promotions. If an HCO does not provide
development and opportunities for career growth, it will have trouble retaining younger
workers. Further, many employees in clinical fields—such as nursing and therapy professions—seek career ladders that provide promotion into advanced clinical jobs rather than
promotion into supervisory jobs. Offering promotions up clinical career ladders can help
retain clinical workers.
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Chapter 8: Staffing: Retaining Employees 191
Often in HCOs, the “best” worker is promoted to supervisor when that position
becomes vacant. If he is not properly prepared for the job, that new supervisor is likely to
make mistakes and perhaps fail in this new job. He might maintain peer-to-peer relationships rather than shift to superior–subordinate relationships. He might hesitate to delegate
tasks to other workers. A new supervisor might avoid giving necessary, critical feedback to
the staff. Job development programs are essential to help workers prepare for promotion to
1. Needs assessment: Determine what training is needed (in the short term and long
term) for the HCO and for specific employees. Examine prior planning for staff,
employees’ job performance appraisals, employees’ career development plans,
on-the-job safety reports, customer satisfaction data, employees’ input, surveys,
strategic plans, job redesign, and other relevant information. Needs may be
prioritized and the most important ones addressed first.
2. Purpose and objectives: For each chosen training need, write the specific purpose,
objectives, and desired outcomes. Which new knowledge, skills, attitudes, behaviors,
and competencies should employees have as a result of the training?
3. Content, methods, and instructors: Decide appropriate curriculum, content teaching
and learning methods, instructors, and resources to achieve the desired purpose,
objectives, and outcomes. Keep it simple, practical, and job related. Use appropriate
methods, media, and technology, which may include videos, online apps, self-paced
tutorials, teleconferences, webinars, games, assignments, simulations, lectures,
interactive demonstrations, workshops, team-based learning, discussions, role-play,
written materials, case studies, mobile learning, job shadowing, on-the-job training,
behavior modeling, and mentoring. Allow time for trainers and facilitators to practice,
revise the content and methods, and rehearse again before going live. If necessary,
increase both organization support for the training and trainees’ readiness (e.g.,
motivation) for the training.
4. Implementation: Make training as convenient as possible (e.g., schedule it on
different days and times) for the trainees. Find out which days, times, and locations
would avoid disrupting their usual work. Ensure all supplies and resources are
available. Avoid trying to train too many employees at once. Be flexible and adjust as
needed during the training. Deliver the training.
5. Evaluation: After the training is complete, evaluate all aspects of the training and
monitor (initially and later on) how well it achieved its purpose. Consider how trainees
feel about the training, what they learned, which behaviors changed (and for how
long), whether the training objectives were achieved, and return on investment. Make
notes on how to improve the next training.
Exhibit 8.1
Training Checklist
Sources: Information from Cummings and Worley (2015); Kaye and Fottler (2015); McConnell (2018); Noe et al.
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192 Management of Healthcare Organizations
a supervisory or management job. Ideally, prospective managers are developed for management prior to promotion into such a position. This preparation can be done in succession
planning for the management team as a result of the first staffing process: planning for
staff. Managers can identify employees for potential future promotion and then provide
them with expanded mentoring, coaching, and other opportunities to develop needed
competencies for promotion (White and Griffith 2019). Many large health systems have
lengthy, comprehensive management development tracks to continually prepare their next
managers and leaders.
In one important trend, more HCOs are seeking physicians for top management
positions such as vice president of medical affairs, chief clinical quality officer, and even
president and CEO. Because of the small supply of physicians who are ready for these jobs,
some health systems are using management development, executive coaching, and other
methods to prepare their own physicians for this work (Dye 2017).
Appraising Performance of Staff
In chapter 7, we defined appraising performance as the process of evaluating the job performance of workers and discussing those evaluations with them. The appraisal process
should develop an HCO’s employees so they can help achieve the HCO’s goals and their
own career goals.
Top managers or HR staff design performance appraisal methods, procedures,
schedules, and systems for the entire HCO. Supervisors and department managers then
use those to appraise the workers for whom they are responsible. When done well, these
appraisals can achieve many useful purposes, such as the following (Dunn 2016; Fried
2015; McConnell 2018):
◆ Enable manager and employee to openly discuss the employee’s job, job
performance, and related matters, including training and development, job
transfer or promotion, and compensation
â—† Remind the employee what is expected based on the job analysis and job
â—† Provide candid feedback to the employee regarding job performance, how
well job expectations have been met, performance strengths, and needed
performance improvement
â—† Coach the employee on how to improve specific aspects of performance
◆ Identify the employee’s future developmental goals to support individual
career plans and the HCO’s succession planning
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Chapter 8: Staffing: Retaining Employees 193
â—† Enable the HCO to maintain a skills inventory of each employee and of the
HCO’s workforce
â—† Guide and support future training and development for employees and the
HCO as a whole
◆ Guide and support a manager’s decisions about compensation
◆ Guide and support a manager’s decisions about promotion, transfer,
discipline, and termination
â—† Guide and support organization succession planning for critical jobs
â—† Support compliance with accreditation and legal requirements
Unfortunately, appraisals are not always done well (Dunn 2016; Fried 2015; McConnell 2018). They may be dreaded and considered a waste of time by both the appraiser
(manager) and the appraisee (employee). What are barriers to effective appraisals?
The appraisal process must be well designed and based on clear, up-to-date job
descriptions. Actual job performance must be measured, which takes a lot of time if
appraisal apps and data collection systems are not available. Managers are human and may
be influenced (consciously or unconsciously) by emotions, biases, favoritism, personalities, organization politics, time pressures, and factors that are not job related (Dunn 2016;
Noe et al. 2016). Managers may inflate or deflate appraisals for reasons unrelated to job
performance, such as wanting to get along with everyone. They may wish to avoid creating
a realistic but negative appraisal that would remain in the employee’s file for many years.
Employees may perceive appraisals as demeaning, judgmental, condescending, punitive,
or in other ways unpleasant and unfair (Fried 2015). An employee may not acknowledge
performance problems (which should be discussed to guide future development goals) if
doing so will affect future pay. Some people are uncomfortable judging or being judged by
others. All these factors may cause managers and employees to superficially hurry through
an appraisal or just skip it.
When appraisals are not done well, employees resent and distrust them, making
the next appraisal even harder for both manager and employee. Many employees dislike
annual evaluations because they don’t think their boss knows how to do them (Fisher 2016).
Managers can try to avoid problems by using the methods explained in the next section.
However, some managers and organizations are abandoning annual appraisals and shifting
to a faster, simpler, real-time approach. They feel the annual appraisal is too bureaucratic,
time-consuming, and retrospective. They think it is not relevant when jobs, goals, and
organizations change so often. Also, many younger employees want informal, frequent
feedback. Methods for improving traditional evaluations are explained next, followed by
the newer approach.
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194 Management of Healthcare Organizations
Appraisal Process and Methods
In many HCOs, managers formally appraise each employee once a year. In other HCOs,
they do appraisals more often. New workers, such as a paramedic in Auburn, may be formally evaluated at 3 months, 6 months, and 12 months, and then annually thereafter. The
same is often true for employees who have been transferred or promoted into a different
job. If an appraisal identifies serious performance problems, the manager should appraise
the employee again soon.
Even if a formal appraisal indicates acceptable performance, managers should regularly
follow up with the employee to ensure satisfactory progress on annual performance goals.
Managers must continually monitor and talk with all employees about their job performance.
A medical assistant will benefit from receiving day-to-day feedback in short conversations
during the week about specific aspects of job performance. Supervisors and managers should
interact with their employees in their work setting often enough that this feedback happens
easily and naturally. Newer, younger workers want frequent feedback—perhaps weekly or even
daily—and companies have been changing their performance appraisal methods to provide it.
Who provides input for an employee’s appraisal? The manager always does, and in
some cases the employee may do a self-appraisal. Coworkers and team members who interact
extensively with (and perhaps depend on) an employee may be invited to give input. Many
HCOs use a multisource (or 360-degree) evaluation in which selected workers above, below,
and at the same level as the employee all provide input for that employee’s appraisal. Feedback
and data from bosses, peers, subordinates, and team members assess an employee’s performance
from multiple perspectives. Depending on job requirements, input on performance may also
be obtained from outside the HCO. For example, consider Priya, a hospice coordinator. Input
may be obtained from employees in other organizations with whom Priya interacts for her job.
People can provide appraisal input by completing checklists, questionnaires, and
surveys that involve marking their choices for prepared statements and factors. This input
generally focuses on an employee’s traits, behaviors, competencies, and results (Fried 2015).
Larger HCOs with many employees invest in electronic performance management systems
to collect and process this input for large workforces. Some managers use a less focused
approach and ask people to write essays or answer open-ended questions about an employee.
Conversations can provide more qualitative information. In all cases, managers should
plan ahead and give people several weeks to respond with input. Information is usually
recorded on standard forms—paper or electronic—although some HCOs are flexible and
use customized appraisals (Fottler 2015).
HCOs often use forms with rating scales. These scales measure how well a worker
performs (what he actually does) in relation to his job description and job standards. Some
scales measure employees’ skills, knowledge, behaviors, or traits. A current approach is to
measure employees’ results. Exhibit 8.2 shows a sample performance rating scale.
Unfortunately, these scales leave room for manager opinion and interpretation. Thus,
HCOs often use more specific rating forms that define what each number rating means.
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Chapter 8: Staffing: Retaining Employees 195
For example, a 1 might be defined as “results are often late and less than assigned.” Yet,
different managers still might interpret the rating scale differently. What does “often late”
and “less than assigned” really mean? Managers should strive to use measurable standards
and benchmarks to define what the ratings 1, 2, 3, 4, and 5 mean. Here are some measurable standards for a 5 rating:
â—† Number of patients treated per day is between 15 and 20.
â—† Average cost of supplies per week is less than $100.
Another useful approach is to design the rating scale with only three ratings to indicate
that performance was below, met, or exceeded preset job standards (McConnell 2018).
Rate the employee’s quantity of work:
1 = performance was below standards
2 = performance met standards
3 = performance exceeded standards
For each numerical rating, the manager should give specific examples to support the rating,
especially for a low rating that the employee may challenge. A manager could keep track
of and then identify specific examples of late work, such as “The monthly budget analysis
was late in April, June, July, and October during the past year.”
Although the rating scale method is common, a manager can use other appraisal
methods. She may apply a comparative approach to all employees (or groups of employees) and rank them from best to worst. Or, she may use the forced distribution method
that assigns (distributes) all employees to categories such as the top 20 percent, middle 60
percent, and bottom 20 percent (Fried 2015). However, these approaches are becoming
less common.
After rating the performance of each essential job expectation, a manager should
write about the worker’s strengths and weaknesses and give recommendations for the coming year. The appraisal now becomes developmental to help the worker develop short-term
(Low) (High)
1. Rate the employee’s results on the job. 1 2 3 4 5
2. Rate the employee’s work quality. 1 2 3 4 5
3. Rate the employee’s quantity of work. 1 2 3 4 5
Exhibit 8.2
Rating Scale
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196 Management of Healthcare Organizations
and longer-term performance and career goals. This aspect of the appraisal takes careful
thought and work and requires managers to pay attention to their employees throughout
the year. The manager writes a performance appraisal to steer an employee’s future efforts
toward helping to achieve the HCO’s goals and strategies. The next appraisal should then
consider how well the previous recommendations were achieved.
In the final part of a performance appraisal, the manager must arrange and conduct
a review meeting with the employee. This discussion may create anxiety for both of them,
especially if performance was inadequate, they do not have a good working relationship, or
the past review meeting was unpleasant. To ensure an effective review meeting, a manager
can use the methods shown in exhibit 8.3.
As mentioned, some organizations and managers have been shifting from formal,
annual appraisals to less formal, more frequent appraisals. Some are using frequent, continual, real-time feedback. Companies set expectations with employees and then give
frequent, regular feedback without a formal annual appraisal (Schawbel 2016). With so
much change in organizations, job expectations may change and be reset during a performance year to accommodate new goals and projects. Performance management software
enables such changes, as well as continual monitoring and reporting of many aspects of
each employee’s performance and contributions to jobs, teams, projects, departments, and
the organization. Attentive, engaged managers regularly (monthly or even weekly) make
rounds in their departments to informally assess workers and give them frequent feedback.
This approach uses informal conversations as things happen. Many managers and workers
like this frequent feedback in small doses. It is more natural and doesn’t require time for
gathering input from stakeholders, checking boxes, and writing and reading commentary.
Texas Health Resources has 24,000 employees in 29 hospitals. It has been implementing an employee performance review process that provides ongoing, real-time feedback pertaining to work, goals, and outcomes. Texas Health Resources’ CEO says it is like
coaching a sports team as play happens. A vice president at Thomas Jefferson University
Hospital in Philadelphia evaluates leadership team members using a one-page professional
development plan. The plan includes personal and professional goals (short-term and longterm) and competencies to develop. He meets regularly with each team member to follow
up on the plan (Wagner 2017).
In between the formal, annual approach and informal, frequent approach are many
possible variations. Each HCO can determine its own process and decide who provides
input, how input is gathered and presented, how the discussion occurs, and what documentation is prepared for follow-up.
When Job Performance Is Deficient
Sometimes an employee does not meet job performance expectations. The manager or
supervisor should realize this deficiency long before an annual performance appraisal and
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Chapter 8: Staffing: Retaining Employees 197
should manage it when it happens. This approach is one benefit of frequently assessing
employee performance and frequently giving feedback throughout the year. If goals and
standards are not being met or rules are not being followed, then the manager must discuss it with the employee promptly, privately, and professionally (Dunn 2016). Candid
exploration of the problem with the employee may reveal factors such as lack of resources,
training, or time; misunderstanding of goals and expectations; or other reasons beyond the
employee’s control that the manager must address.
Yet, in some cases, unsatisfactory job performance may result from the employee’s lack
of commitment, effort, or willingness. If this is the case, disciplinary action is appropriate.
Many HCOs use progressive discipline. The manager begins by mentioning the job
performance problem in an informal, friendly discussion with the employee (Dunn 2016).
If necessary, the manager follows up with a stern verbal warning. If the performance problem continues, a written warning is given and placed in the worker’s employment file. The
next step would be unpaid suspension from work (one or more days) to “think about your
commitment.” If the problem continues after suspension without pay, then termination is
✓ Ensure that top management supports the performance appraisal process.
✓ Give feedback to the employee during the year to continually guide performance as
needed and to avoid (unpleasant) surprises at the review meeting.
✓ Allow one month of lead time to schedule the review meeting, gather information
from multiple sources, review the job description, and write the appraisal.
✓ Anticipate how the employee may react, and then plan how to respond.
✓ Arrange the review meeting to take place in a comfortable, private place at a
convenient, uninterrupted time.
✓ Give performance feedback and recommendations, praise and reinforce good aspects
of performance, honestly discuss unsatisfactory aspects of performance, and be
specific and objective.
✓ Lead a discussion that is supportive, not punitive, and listen for content and feeling
when the employee talks. Coach, inspire, and motivate.
✓ Focus on the employee’s performance, behavior, and results (not personality), and
then shift to future performance.
✓ Collaboratively plan future goals and expected outcomes; discuss the future more
than the past.
✓ Document the appraisal review, developmental performance goals for the future, and
plans for follow-up; sign the written appraisal and have the employee sign it.
✓ Give copies of the appraisal to the employee and the HR department; keep a copy to
use for periodic follow-up. The appraisal is confidential, so do not share it with other
Exhibit 8.3
Appraisal Meeting
Sources: Information from Dunn (2016); Fried (2015); McConnell (2018); Noe et al. (2016); Walston (2017).
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198 Management of Healthcare Organizations
usually the fi nal step. Th e manager should be prompt, fair, and consistent and document
each step when it occurs. Some HCOs use an alternative, nonpunitive approach that forces
the employee to take responsibility for the problem and solution. After counseling and
discussion, the HCO pays the worker to stay home one day and make a decision: either
return to work committed to fulfi lling all job requirements, or do not return to work. Th is
is called a decision-making paid leave, and the negligent employee must make a choice
and live with it.
Each HCO can develop its own approach to progressive discipline. Th e HCO’s
managers must carefully follow the written policies and procedures for progressive discipline
and document what was done at each step of the process.
Th e appraisal methods listed in exhibit 8.3 are useful for middle managers and supervisors who must evaluate their frontline workers. Th ese methods can also be used by top
managers to appraise middle managers, and to some extent by a CEO to appraise other
C-suite managers and executives. Such appraisals may be done as a narrative explaining how
well the manager has fulfi lled the position’s responsibilities, accomplished preset goals, and
achieved outcome targets (White and Griffi th 2019). Th ese factors can pertain to fi nances,
customer satisfaction, clinical outcomes, human resources, legal compliance, population
health, and key organization-level outcomes under an executive’s control. As much as possible,
When an HCO adopts a new vision and goals, it may have to modify its performance
appraisals to drive achievement of those goals. A new CEO at Cooper University Health
Care (CUHC) in Camden, New Jersey, was expected to improve patient service and experience. She stated a new vision for the HCO and set clear expectations for the staff to
achieve it. A chief experience offi cer was hired as the conscience of the organization.
An analytics system was developed to gather data—including patients’ ratings—and to
measure performance. Then CUHC started evaluating staff on values and behaviors as
part of job performance. The evaluation closely looked at employees’ emotional intelligence (EI), which is the “ability to recognize and understand emotions in yourself and
others, and your ability to use this awareness to manage your behavior and relationships” (Kivland 2014, 72). Employees need appropriate EI to provide excellent patient
experience. To achieve its patient experience vision, CUHC used performance evaluations to appraise its staff and, if necessary, to remove people who lacked the necessary
values and behaviors (Radick 2016).
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Chapter 8: Staffing: Retaining Employees 199
objective data should be used to measure goal achievement and outcomes. If an executive has
an employment contract with the HCO, the appraiser must understand and comply with it.
As mentioned earlier, the performance appraisal process for an entire HCO interacts with other staffing processes. Appraisals uncover performance problems that must be
addressed in future planning for staff. They may signal a need to redesign some jobs or
show which type of training is needed. Appraisals also may reveal flaws in the hiring process. Finally, appraisals help a management team determine an employee’s compensation.
Compensation is the next staffing process we will consider.
Compensating Staff
In chapter 7, we defined compensating staff as the process of determining and giving wages,
salaries, incentives, and benefits to workers. Compensation includes pay (e.g., wages, salaries,
merit increases, cost-of-living increases, bonuses, shift differentials, cash incentives) and
benefits (e.g., paid vacation, health insurance, child care, retirement contribution) given
to workers (Noe et al. 2016). Pay and benefits vary according to several factors, including
full-time or part-time status, salaried or nonsalaried status, and years worked at the HCO.
Besides receiving financial compensation, employees may also receive other rewards for their
work as part of a total rewards approach (Griffin, Phillips, and Gully 2017). Other rewards
may include praise, recognition, and awards; special privileges and perquisites; promotion
and advancement; and an organization culture and policies that enable workers to balance
work lives and personal lives (McSweeney-Feld and Rubin 2014). Together, nonfinancial
rewards and financial rewards make up total rewards to compensate employees for their
work. This section focuses mostly on financial compensation, while nonmonetary rewards
are discussed in the next section and in later chapters on leadership and organization culture.
Compensation strongly affects how well an HCO obtains and retains employees.
Thus, it strongly affects an HCO’s survival. Managers must “get it right.” Yet, doing so is
not easy because compensation is complex.
1. Compensation is an important and sensitive matter for each employee.
(Today’s management tip: Do not make a mistake with someone’s paycheck!)
2. Dozens of laws and court decisions affect how HCOs compensate workers.
3. Compensation differences among employees arise because of differences
in the value of jobs, individual human motivations, the generations in the
workforce, required licensures and certifications, chronic shortages of available
workers for essential jobs, and other factors.
4. Differences in pay must occur, yet employees may feel that the differences
(real or assumed) are unfair.
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200 Management of Healthcare Organizations
Top managers and HR staff are responsible for developing their HCO’s compensation
system. In large HCOs, someone in the HR department will have compensation expertise
to help managers. Some HCOs outsource compensation work to consultants who design
and administer effective, legal plans for pay and benefits. Before developing the compensation details, top executives make broad organization decisions about how competitive
their HCO will be in their labor market. Will the HCO pay above-average, average, or
below-average wages? How will the wages affect spending on other forms of compensation
(e.g., employee benefits) and spending on other needs (e.g., medical equipment)? How will
it affect staffing recruitment and retention?
Managers play several important roles in compensating employees (McConnell 2018).
First, they must work with HR and payroll staff to apply the HCO’s overall compensation
program to their own department. They might determine merit pay or bonuses for their
direct-report employees. Second, managers must be familiar with the HCO’s compensation
methods and benefits to answer questions from their employees (perhaps after checking the
HCO’s compensation policies or with HR). Detailed questions may be referred to HR and
payroll staff. Third, managers must be attentive to employees’ complaints about pay and
compensation, and strive to resolve issues with help from HR staff and higher managers
when necessary.
How Is Pay Determined?
How do an HCO’s managers determine pay? Base pay, wages, and salaries are set for each
job based on (1) the value of each job to the HCO, (2) prevailing pay in the community
for jobs, and (3) the HCO’s approach to compensation competitiveness.
Large HCOs have more than a hundred unique jobs. Managers assign each job a
value indicating how much it is worth and should be paid. In doing so, they must strive to
ensure fair pay for each job in relation to all other jobs. This valuation is not easy. When
managers determine the value of a job, they depend on accurate position descriptions to
analyze jobs.
A common approach to figuring job values is the point-factor system (Fried and
Smith 2015; Noe et al. 2016). The basic method is explained in this section, and HCOs
can create their own variation of it. The point-factor system may be implemented by a committee of selected HR staff and managers. The committee chooses a group of compensable
factors that the organization values and will pay for, such as skill, effort, responsibility, and
working conditions. These factors may all have the same weight, or they may be weighted
if one or more factors (e.g., skill) are felt to be more important than others. Each factor
(e.g., skill) has several levels (e.g., levels 1, 2, 3, 4, and 5) worth increasingly more points
(e.g., 20, 40, 60, 80, and 100). The committee uses job descriptions and other information to evaluate each job based on that same set of factors. The committee assigns points
to each job (e.g., accountant) for each factor (e.g., skill) by judging which level is required
point-factor system
A system for
determining a job’s
value, in which points
are assigned to each
job based on how each
job rates on a common
set of factors used
to evaluate all jobs;
total points for a job
determine pay for that
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Chapter 8: Staffing: Retaining Employees 201
(e.g., skill level 4, worth 80 points). Then for each job (e.g., accountant), the points for all
factors (e.g., skill, effort, responsibility, and working conditions) are added together. The
sum is the total point value of that job. This calculation is done for each job so that each
job has a total point value or worth.
Let’s consider the computer programmer job. Managers evaluate it and assign points
for all four factors as follows.
â—† Skill = 80 points
â—† Effort = 60 points
â—† Responsibility = 40 points
â—† Working conditions = 20 points
The programmer job is worth 200 points. All jobs are similarly evaluated and assigned
their total point value.
Then the committee gathers market research data for competitive prevailing pay
rates for common key jobs such as computer programmer, pharmacist, accountant, chef,
and nurse. This helps create competitive wages. As a result of the programmer’s point value,
the prevailing competitive salary data for programmers, and the HCO’s overall organization
decisions about compensation, the HCO’s managers set the programmer’s annual base pay.
From the data gathered for other key jobs, such as pharmacist, accountant, chef, and nurse,
annual base pay is set for these key jobs. A spreadsheet program is used to plot a regression
line for all key jobs to find the best fit between job value points and job base pay. The point
value of each job can then be individually entered into the regression equation to determine
the annual base pay for each job. If managers feel it is necessary for a specific job, they can
adjust pay up or down from what is indicated by the regression curve.
Sometimes jobs are grouped (classified) into job grades (classes) based on how they
rate for the compensable factors. For example, the federal government uses a classification
system that groups most jobs into 15 different job grades. A pay rate is set for each grade,
and the pay rate for a given grade applies to all jobs in that grade. Using job grades greatly
reduces the amount of work required to set pay. However, jobs that would have different
point values are grouped together and paid the same. This weakens internal equity.
Sometimes compensation becomes more complicated. Suppose a manager later finds
that the base pay rate is not high enough to obtain and retain workers because of higher
prevailing pay in the community. If the average local base pay for a job has increased, the
HCO may have to set its own base pay close to that higher local pay rate (or else offer a
much richer benefit package). Raising programmer pay to meet the prevailing pay in the
community helps create external equity of the programmer’s pay compared to pay for
similar jobs outside the HCO. However, this pay raise causes the job to be paid more than
internal equity
Fairness in
compensation for
a job compared to
compensation for
other jobs inside the
external equity
Fairness in
compensation for
a job compared to
compensation for other
similar jobs outside the
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202 Management of Healthcare Organizations
when its pay was based on the internal point value. Thus, the programmer job pay increase
to achieve external equity upsets the internal equity of programmer pay. Managers often
face this dilemma and must balance internal and external equity.
Once the base rate of pay for a job has been set, the base rate of pay for a specific
person in that job might be increased because that person has extra education or years of
experience beyond the minimum required. Suppose Samantha is a programmer with five
more years of experience than the minimum required. Managers may decide to pay her
$5,000 more annually because she is more experienced.
The base pay rate of all jobs in an HCO usually increases each year. However, if
funds are not available, base pay might be held constant. If an HCO is struggling financially,
base pay might even be reduced. Top-level managers make these compensation decisions
each year. Sometimes they make further adjustments midyear to adapt to internal and
external changes.
Workers in lower-valued jobs receive hourly wages generally based on how many
hours they work times their hourly rate of pay. Workers in higher-level jobs, such as managers
and professional staff, receive a salary regardless of how many hours they work. Beyond
their base pay, some workers may be eligible for additional pay, such as
â—† sign-on bonuses for newly hired workers;
â—† retention bonuses for those who reach longevity targets;
â—† overtime pay for nonsalaried workers;
â—† differential pay for working second shift, third shift, weekends, and holidays;
â—† profit sharing (in for-profit HCOs); and
â—† various forms of incentive pay, including pay-for-performance bonuses.
HCOs have been increasing their use of performance-based pay and incentives
(Fried and Smith 2015). This kind of pay is earned for achieving preset goals, standards,
and other performance targets. Driven by payers reimbursing HCOs more for value (rather
than volume) of care, incentive targets often reflect quality of care, clinical outcomes, and
patient experience and satisfaction (rather than traditional volume of services and procedures). Pay for productivity performance is also common. These incentives may include
bonuses and merit pay. Another trend shows HCOs offering compensation and incentives
based on performance of teams, departments, and entire organizations. This trend creates
challenges in deciding how much to base pay on individual performance versus group
performance. Top managers will have to decide how much to decentralize incentive pay
decisions throughout an HCO.
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Chapter 8: Staffing: Retaining Employees 203
How Are Benefits Determined?
In addition to paying workers, managers must compensate them with benefits. To properly
manage benefits and compensation, managers must obtain clear advice from experts, such
as labor attorneys or compensation consultants. Managers may check the US Department
of Labor website to learn how laws affect benefits. A few benefits are required by federal and
state laws, such as the HCO’s contributions to employees’ social security (for retirement)
and workers’ compensation (for on-the-job injuries).
Most benefits are voluntary, although some are expected by most workers and thus
essential for staffing an HCO. Everyone expects paid personal time off for holidays, sickness,
vacation, and other purposes. There are dozens of possible benefits, and employees differ
in which ones they prefer. Younger employees may want day care for children, whereas
older workers often prefer contributions to a retirement plan. Therapists like payment for continuing education, whereas housekeeping staff might
like another paid day off. Other possible benefits
are numerous: fitness facilities, tuition reimbursement, life insurance, disability insurance, subsidized meals, dues for professional associations,
and many others. Managers often create flexible
benefits plans that allow each employee to choose
from a variety of benefits up to a specified dollar
value. Although this “cafeteria” approach is more
complicated to administer, it increases employees’
satisfaction and retention because they can pick
the benefits they want. Many larger HCOs have a
secure employee compensation management system that enables managers to administer and monitor pay and benefits for all employees.
These systems may also enable employees to monitor and (to some extent) control their
own benefits selection and use.
The value of employees’ benefit packages in many HCOs exceeds 25 percent or
even 30 percent of base pay (Clement, Curran, and Jahn 2015). Because employees often
underestimate the value of their benefits, managers should provide data to staff showing
the value of their benefits.
Protecting Staff
Imagine how hard it would be for an HCO to achieve its mission and goals if employees
stayed home because of an on-the-job accident, uncontrolled infection, job stress, low
The US Department of Labor offers much information about
federal laws for pay and benefits. Its wages webpage (www
.dol.gov/general/topic/wages) provides a wealth of information for employees and employers. Topics covered include labor
laws related to wages, overtime pay, educational level and pay,
record keeping and reporting, and more. This resource can help
you be better informed as both an employee and a manager.
Check it out online and see what you discover.
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204 Management of Healthcare Organizations
morale, an abusive coworker, or an uncaring supervisor. In chapter 7, we defined protecting
staff as the process of ensuring that employees have proper and safe working conditions,
their rights are protected, and their opinions are considered by managers. When staffing an
HCO, a manager must protect staff, which is the last of the seven staffing processes. Similar to other staffing processes, protecting workers helps an HCO maintain the workforce
needed to achieve its mission and goals. The importance of this process is reflected in the
shift toward protecting employees rather than employers (Fottler 2015).
Protection is especially important for a diverse workforce because employees and
managers may have different beliefs, cultures, and behaviors. Thus, managers must set clear
policies and model behaviors that will ensure appropriate working conditions, rights, and
consideration of all workers. Some businesses have formed employee resource groups to
support diverse groups of workers who have different cultures and lifestyles. The methods
described in this chapter, and in later chapters on leadership and communication, can help
you provide such support.
Employee protection is good for business for several reasons. First, it is required by
the Occupational Safety and Health Act, by other laws, and by The Joint Commission,
which accredits HCOs. Second, it can improve employee morale, productivity, and retention. Third, it helps an HCO become known as a safe place to work. Fourth, safety and
health violations can become costly because of lost business, lawsuits, overtime wages to
cover absent staff, employee resignations (and subsequent staff shortages, vacancies, and
hiring expenses), and higher costs for liability insurance and employee health insurance.
Yet, in general, employee protection in HCOs is inadequate. They have high levels
of workplace violence, burnout, bullying, and safety hazards (Fried 2015; McConnell
2018). Pause and think of the dangers in HCOs, especially large ones. They present physical
hazards such as radiation, biological waste, potential for fires, injuries from lifting patients,
infectious diseases, noise, dangerous equipment, repetitive motions, needle sticks, slippery
floors, and workplace violence. Mental and emotional hazards include stress, hostility, privacy
violations, and harassment (which can be based on race, gender, religion, age, disability,
Suppose both you and one of your parents began working this year at a large for-profit
pharmaceutical company. It offers a flexible cafeteria approach to employee benefits.
List the top seven benefits you would choose. Then list the top seven benefits you think
your parent would choose. How are the lists similar? Different? (Discuss this exercise
with your parent if possible.)
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Chapter 8: Staffing: Retaining Employees 205
and other factors). Increasingly, workers bring their depression, anxiety, and stress to work
with them. Some of it is caused by employers expecting workers to respond to after-hours
e-mail and text messages. No wonder some HCOs have high turnover and vacancies.
Violence and burnout in HCOs require more discussion. “The healthcare field
experiences higher rates of workplace violence than any other industry, according to the
Occupational Safety and Health Administration” (Blouin 2017, 76). Patients—and their
relatives and visitors—cause the most violence in HCOs; healthcare employees are the
second most common cause (McConnell 2018). Managers must work to prevent such
violence. The following actions can help (Blouin 2017; McConnell 2018):
â—† Having (and enforcing) a zero-tolerance policy
â—† Ensuring an organization culture of civility, respect for others, and inclusion
â—† Carefully assessing and screening job applicants
â—† Investigating and acting on warnings of violence
â—† Modifying buildings and work areas to increase security and prevent, detect,
and control violence
â—† Training staff to prevent, recognize, and de-escalate violence
â—† Providing counseling and employee assistance programs to employees
struggling with mental and behavioral health, substance abuse, and life crises
â—† Providing staff and others with a hotline to report threats, bullying,
harassment, and potential violence
According to Swensen (2018), burnout of healthcare providers has become much
too common and affects about half of the nurses and physicians in HCOs. Burned-out
employees feel emotionally exhausted, cynical, detached, and isolated. They struggle to
perform their jobs well. Managers can reduce burnout by addressing working conditions
and human needs for camaraderie, trust, and passion for work (Swensen 2018). They can
â—† design organizations to support human needs,
â—† use participative management and servant leadership,
â—† remove obstacles that frustrate clinical staff who are trying to care for patients,
â—† be fair with and care for staff involved in an adverse patient event,
â—† sponsor inclusive staff gatherings and meals, and
â—† make wellness opportunities easily available.
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206 Management of Healthcare Organizations
Perlo and Feeley (2018, 85) go further and argue that HCOs must create more
joy in work. An absence of burnout is not enough: “When people experience joy on the
job, they have an intellectual, emotional, and behavioral commitment to meaningful and
satisfying work.” That enables HCOs to improve patient experience, customer satisfaction,
safety, employee engagement, teamwork, productivity, and other goals.
Department managers and frontline supervisors are responsible for safety in their
departments and work areas. Suppose Trevon manages an ambulatory surgery facility in
Springfield that is owned by a healthcare system. He should monitor working conditions,
lighting, ventilation, comfort, and security; arrange repair of broken equipment; report
workplace accidents and injuries; arrange training on workplace safety; orient employees to
policies needed for safety and protection; and include safety as part of annual performance
appraisals. Trevon may be assisted when necessary by specialists from the healthcare system.
They would have expertise in safety, security, infection control, employee health, plant
engineering, human resources, maintenance, housekeeping, and other specialties. Smaller
HCOs have fewer of these staff specialists and contract with consultants and external businesses for expertise when needed.
Working conditions include the workplace culture, and managers must not let it
become toxic. Bullying behavior often is enabled by a very competitive culture that allows
and even encourages rivalry to the point of bullying coworkers, subordinates, and others
(Fried 2015). Managers can create a culture that safeguards employees and their rights and
safety. Chapter 11 explores how to develop culture.
Employees in HCOs have rights at work determined by laws and court decisions
that managers must follow (McConnell 2018).They have rights that pertain to speech,
privacy, justice, nondiscrimination, and due process. These rights are limited in the workplace, however, just as rights are limited outside the workplace in society. Managers (and
employees) must try to balance the rights of one or more employees with the rights of
others (e.g., patients, visitors, suppliers, other employees, and the HCO itself ). Thus,
HCOs use electronic surveillance to deter and detect narcotics theft and to ensure handwashing technique is followed, even though this surveillance infringes on workers’ privacy.
Employers monitor internet use and e-mail at work (and sometimes social media outside of
work). For some jobs in HCOs, managers require drug testing. Some businesses and HCOs
apply surveillance, biometrics, and big-data analytics to workers to improve workplace
safety, productivity, and proper use of supplies and equipment. Federal and state laws are
struggling to keep up with rapidly evolving technology that affects the rights of employees,
employers, and others.
An important right of workers is the opportunity to present work-related problems
and grievances to managers and then have managers respond to those concerns. Effective
managers make sure to do this. How? Managers and the HR staff should establish multiple
ways that workers can be heard and have their concerns addressed (McConnell 2018;
White and Griffith 2019). These may include
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Chapter 8: Staffing: Retaining Employees 207
◆ policies supporting employees’ rights;
â—† communication via open-door policies, suggestion boxes, and town hall meetings;
â—† formal written grievance procedures with prompt follow-up and resolution;
â—† visits by top managers to all departments, including on weekends and during
second and third shifts if HCOs are staffed then;
â—† a disciplinary review board through which an employee may seek a review of
disciplinary action;
◆ HR managers who present employees’ views and concerns at management
staff meetings and help managers consider how their potential decisions
would affect the workforce;
â—† HR staff who assist employees in voicing individual concerns to management;
â—† sensitivity to and respect for people of diverse cultures and backgrounds;
◆ an employee ombudsman to investigate and resolve employees’ complaints;
â—† an employee advisory council that meets regularly with managers; and
â—† supervisors and managers who genuinely care about their workers and manage
that way.
What happens when employees believe managers have mistreated them, feel their
rights are being violated, or think their concerns are being ignored? What happens when
other staffing processes are not done well? Recall the discussion of labor unions in chapter
4. Employees might vote to join a labor union through which they will seek better jobs,
work, rules, schedules, compensation, and other terms of employment. Their concerns
will be heard. The union enables workers to join together and gain power as a group to
collectively present concerns to managers and negotiate demands. Some people think workers join unions to gain better compensation. That is only part of the story. Workers also
join unions for protection against perceived unfairness, humiliation, harassment, anxiety,
insecurity, dangers, and managers who do not seem to care.
Onboarding is the process of “helping new hires adjust to social and performance aspects of
their new jobs” (Noe et al. 2016, 307). The methods discussed throughout this chapter are
used to onboard staff. Recall what you learned earlier about orientation of new employees,
mentoring, training, feedback and performance appraisals, HR support, and managers
listening to employees. All of those actions help to onboard new employees.
The process of helping
new hires adjust to
social and performance
aspects of their new
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208 Management of Healthcare Organizations
Onboarding goes beyond traditional orientation (Noe et al. 2016). It involves
activities, learning, and interactions that should make a new employee feel more confident,
engaged, and accepted by peers and supervisors. Suppose Georgina joins a physician group
in Shreveport as a new medical biller. After onboarding, Georgina should better understand and fit in with her new roles, responsibilities, organization culture, and performance
expectations at that physician group. Managers spread onboarding activities over several
months (sometimes even a full year). Resources are provided, such as mentors, toolkits,
tours, videos, meetings, social events, online discussion boards, social media, workshops,
webinars, newsletters, and other materials. When done well, onboarding improves employee
satisfaction, commitment, performance, and retention.
To make onboarding effective, managers should do it proactively and systematically.
They should intentionally address four levels of onboarding (Noe et al. 2016, 307) from
basic to complex:
1. Compliance is the most basic level and teaches employees the organization’s
basic rules, policies, and regulations.
2. Clarification ensures that employees fully understand their new job and all
performance expectations.
3. Culture helps employees understand the organization’s history, mission, values,
and expected behaviors (formal and informal).
4. Connection helps employees develop interpersonal and work relationships.
Notice that these four levels of onboarding, combined, help new employees adjust to their
new job and organization so they can perform their job well and fit in socially with coworkers.
Managers must staff their HCO to perform the HCO’s work and achieve its mission and
goals. They must obtain and retain people to perform jobs. While managers are responsible
for these tasks, HR specialists often assist in staffing the HCO. The four staffing processes
studied in this chapter are especially helpful for retaining employees: training and developing staff, appraising performance, compensating staff, and protecting staff. These processes affect each other and the three staffing processes discussed in chapter 7.
Training and developing staff enables employees to acquire new knowledge, skills,
attitudes, behaviors, and competencies for current and future jobs. All employees in a manOne More Time
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Chapter 8: Staffing: Retaining Employees 209
ager’s department need ongoing training and development, which begins with orientation
and onboarding of new employees. To achieve lasting results, managers should follow a
structured approach that addresses prioritized needs; has a clear purpose and objectives;
uses appropriate content, methods, and instructors; is implemented effectively; and includes evaluation.
Appraising performance evaluates the job performance of workers and discusses
those evaluations with the workers. In some HCOs, managers do an annual, formal, written appraisal for each employee. In other HCOs, more frequent, shorter appraisals are
used. Throughout the year, all managers should informally monitor and give feedback
to their workers. For the annual evaluation, a manager should obtain input from multiple sources during the year using valid questionnaires, checklists, interviews, and other
sources of information. The appraisal must be discussed with the employee to share
results and plan future goals. This discussion should focus on performance of the job
(not personality) and on future performance (more than past performance). Managers
and employees may feel uncomfortable about appraisals, so managers should prepare
properly to make them more effective. Results guide future goals, training, compensation,
and other aspects of staffing.
Compensating staff determines and gives wages, salaries, incentives, and benefits to
workers. Managers decide on the compensation, and payroll and HR specialists help managers administer pay and benefits. Pay is largely based on the value of a job and prevailing
rates of pay in labor markets. HCOs offer legally mandated benefits and a variety of voluntary benefits. Employees of different generations and backgrounds prefer different types
of benefits. Many HCOs offer flexible benefit plans so that individual employees have some
choice of benefits up to a preset dollar value. Managers and staff must carefully design pay
and benefits to achieve internal and external equity.
Protecting staff ensures that workers have proper and safe working conditions, their
rights are protected, and their opinions are considered by managers. Safety includes both
physical and emotional safety. Workplace violence and bullying have become serious problems in HCOs, along with many other dangers. Employees should have their rights protected and be able to present concerns to managers. Without that, and without all the other
staffing processes, managers may be unable to obtain and then retain sufficient workers.
Further, workers may join a labor union and collectively bargain for better working conditions and employment.
Onboarding for new employees goes beyond traditional orientation to help them adjust to social and performance aspects of their new jobs. Over an extended period of time,
onboarding combines elements of training, appraising, and protecting workers to improve
their commitment, satisfaction, performance, and retention.
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210 Management of Healthcare Organizations
1. Discuss reasons that employees’ training might not have lasting effects. How can
managers ensure that training lasts?
2. Explain the pros and cons of 360-degree appraisals of employees.
3. Review exhibit 8.3, Performance Appraisal Meeting Checklist. Which items do you
think would be most important for the person who is being appraised? Why?
4. Compare and contrast internal equity and external equity for employees’ pay.
5. Describe the benefits you think would be preferred by workers in different
generations. How do cafeteria benefit plans enable HCOs to satisfy workers with
different benefit preferences?
6. Discuss rights that employees should have at work. What can managers do to ensure
employees’ rights are not ignored?
• Training checklist
• 360-degree evaluation
• Performance rating scales
• Performance appraisal meeting
• Progressive discipline
• Point-factor system
• Internal equity and external equity
• Methods to ensure employees’
concerns are heard
• Onboarding
For Discussion
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Chapter 8: Staffing: Retaining Employees 211
These questions refer to the Integrative Case Studies at the back of this book.
1. Disparities in Care at Southern Regional Health System (SRHS) case: Using this
chapter, explain how training, appraising, compensating, and protecting staff could
be used to reduce disparities in care at SRHS.
2. “I Can’t Do It All!” case: Using this chapter, explain how Mr. Brice could use the
training, appraising, and compensating processes to increase and improve decision
making by his vice presidents.
3. Increasing the Focus on Patient Safety at First Medical Center case: Using this
chapter, explain how training, appraising, compensating, and protecting staff could
support patient safety at First Medical Center.
4. Hospice Goes Hollywood case: In this case, Dr. Frank complained that the staff was
not given adequate training. Use this chapter to describe how to train the clinicians
to follow the new protocols for accreditation.
case stuDy QuestIons
Riverbend Orthopedics is a busy group practice with expanded services for orthopedic
care. It has seven physicians and a podiatrist, plus about 70 other employees. At its big,
new clinic building, Riverbend provides extensive orthopedic care. Several technicians
provide diagnostic medical imaging, from basic X-rays to magnetic resonance images.
The physicians perform surgery in their own outpatient surgery center with Riverbend’s
own operating nurses and technicians. Therapy is provided by three physical therapists and one part-time contracted occupational therapist. In addition to staff providing actual patient care, the clinic has staff for fi nancial management, medical records,
human resources, information systems/technology, building maintenance, and other
administrative matters. Occasional marketing work is done by an advertising company.
Legal work is outsourced to a law fi rm. Riverbend is managed by a new president, Ms.
Garcia. She and Riverbend have set a goal of achieving “Excellent” ratings for patient
experience from at least 90 percent of Riverbend’s patients this year.
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212 Management of Healthcare Organizations
Blouin, A. S. 2017. “Taking a Stand Against Workplace Violence.” Healthcare Executive 32
(2): 76–79.
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Administration Press.
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Ms. Garcia believes in accountability. She thinks Riverbend should do more to hold
employees accountable for their performance—especially as it pertains to patient experience. Yet, she also believes Riverbend Orthopedics must be accountable to employees
for ensuring their safety and rights.
mInI case stuDy QuestIons
1. To help Riverbend achieve its goal, explain in detail how Ms. Garcia could apply performance appraisal methods from this chapter to evaluate the performance of all
employees who have direct interaction with patients.
2. Based on information in this chapter, suggest at least fi ve ways in which the Riverbend workplace might be unsafe or employees’ rights might not be ensured. What
could Ms. Garcia do to protect employees’ safety and rights?
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Chapter 8: Staffing: Retaining Employees 213
Fottler, M. D. 2015. “Strategic Human Resources Management.” In Human Resources in
Healthcare, 4th ed., edited by B. J. Fried and M. D. Fottler, 1–34. Chicago: Health Administration Press.
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Fried, B. J., and H. L. Smith. 2015. “Compensation Practices, Planning, and Challenges.” In
Human Resources in Healthcare, 4th ed., edited by B. J. Fried and M. D. Fottler, 275–320.
Chicago: Health Administration Press.
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Kaye, D. L., and M. D. Fottler. 2015. “Organizational Development and Learning.” In Human
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Health Administration Press.
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Other.” Journal of Healthcare Management 62 (5): 298–301.
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214 Management of Healthcare Organizations
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