Operations management for healthcare organizations. Theory, models and tools

During the 70’s of the last century, the Dean at SDA Bocconi School of Management suggested me to design and run programs for Healthcare management, in the belief that: “... This is not going to be difficult, because functions such as strategy, planning, programming, budgeting, financial and management accounting, organization and HR management, finance, com- munication, marketing, information system and decision making are based on common knowledge and general skills and can be applied in any complex or- ganization, private or public, manufacturing or service ...”. My answer was always “... You are half right and half wrong, half right because knowledge about all these functions you mention are a basic re- quirement. Half wrong because if we do not know the operations of a specific sector of activity, we cannot help participants to learn how to properly use management theory, methods, techniques, and tools. To be able to teach we need to do research and understand that health services are different from other services. Health services are related to life, death, suffering, and profes- sionals have a complete autonomy and responsibility for prevention, diagno- sis, cure, treat and rehabilitation ...”. Stefano Villa, academically, has grown with a “SDA culture” that has provided the basis and framework of this book. Operations is his field of specialization which he approaches with a system-wide perspective taking into consideration the whole healthcare chain (hospital, diagnosis center, primary and intermediate care and other settings) with the final goal of im- proving the patient well-being (value based healthcare approach). Appropriateness and effectiveness can be guaranteed only if operations are well managed. To use Henry Fayol’s definition of management, low efficient opera- tions generate low levels of output and bad outcomes. Unfortunately, many health professionals, in the past and also today, have worked in the belief that the quality of healthcare delivery is related to their own clinical knowledge, expertise and their ethical approach to the patient. Clearly, such attitude is not enough because in complex organizations made up of dozens of units, hundreds and sometimes thousands of doctors, nurses, and other health professional and administrative staffs, processing of diagnosis activities, medical and surgical treatments need to be coordinated. Moreo- ver, acquisition, distribution to unit and use of healthcare materials and technology must be aligned with nursing and clinical activities. A third reason why focus on operations is critical has to do with the re- lation between “to know” (theory), “to know how to do” (methods) and “to know how to get things done” (practice). Vision, mission, strategy, plans do not generate a health pattern for pa- tient, they need execution, that means acting on operations. On the other hand, the analysis of weaknesses in the design and execution of operations can stimulate the introduction of programming, planning, organizational change, people motivation and other innovative processing in hospitals and in other healthcare delivery organizations. Top and middle managers must be aware that every innovation must undergo an ex ante analysis of operations and an ex post evaluation of the actual impact on patients’ health. In this book Stefano Villa draws on his previous researches and teach- ing experiences. The readers can find solid and rigorous scientific approach and cases that, from one hand, provide a clarification of the implication of theory and, from the other hand, can be used as teaching material. Another peculiarity of the book, that should be underlined, it is not rooted in the rational choice framework (maximization/optimization) but in an institutional approach that pursues the rationalization of operations within the specific condition (often constrains) of the institution. In designing operations management change strategies, it is critical to consider all the other relevant organization’s elements such as the culture and motivations of people, the features of the building, availability of tech- nology and the actual investment opportunities. Furthermore, it is a nonsense, an abstract optimization of operations, not considering patients’ perceptions and expectations. Thus, Stefano Villa’s book can be included in the socioeconomic system framework rather than in the contingency approach. Operations analysis and improvement are proposed not with the prospective of sub-optimization of this function, but in the prospective of understanding interdependence with the other components of an organization. Finally, the last key element that qualifies the book is the dynamic ap- proach. Operational system must be continuously adapted to scientific knowledge developement, technology innovation, people competences and motivation, delivery patterns (from cure to care, patient treatment, contin- uous care model, care networks, value based healthcare etc.). Lastly, a comment on the structure of the book. In the first chapter, there is a presentation of main theories of opera- tions, to clarify the meaning of different terms, the differences between op- eration issue in manufacturing and services companies, especially in health care system. In the second chapter, the patient flows are analyzed from admission to operating rooms, to discharge. Analytical content and implementation are provided. The third chapter is dedicated to the supply chain of the materials. It focuses on the relation between external condition and internal processing of materials. In the fourth chapter, methodologies and tools to manage operations are analyzed in more details. As already mentioned, in every chapter some case studies, from different countries, are included and they add a real in- ternational flavor to the book. Milano – march, 26 2021