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Changing the Paradigm of the Emergency Medical Services


Can the Emergency Medical Services Evolve to Meet the Needs of Today?

Click here to view the PowerPoint PDF

The emergency medical services (EMS) provide a means of rapid treatment and transportation to definitive care for those people who suffer immediate life-threatening injuries or illnesses (Department of Transportation, National Highway Traffic Safety Administration, n.d.; Mayer, 1980). There are a number of models across the country and the world that are seeking to redefine EMS in a way that is more meaningful in both of its missions, public safety and public health (Washko, 2012). However, financial constraints and overzealous regulations serve only to pigeon-hole EMS into the decade of its birth and refinement, the 1970s, by restricting incentive and growth and limiting the efficacy of directed research and its application towards the much needed restructuring of EMS.

In this brief literature review, I will examine the roots and context of EMS, its mission and current application, as well as possibilities for research, growth, and development. It is important to recognize that EMS is a grand resource for both public safety and public health, especially in light of the growing body of legislation that officials are using to redefine the current health care system within the United States. As we continue to develop EMS, other nations will look to us as they have in the past to adopt and adapt our system for use throughout the world.

A Brief History of Contemporary EMS

There were many forms of organized out-of-hospital medical aid provided throughout history from the biblical good Samaritan to the triage and extrication from the battlefields of the Roman conquests and the Napoleonic wars through the U.S. Civil War and every major war and conflict in U.S. history; however, it was not until the advent of combined mouth-to-mouth resuscitation and closed chest massage (what we know today as cardiopulmonary resuscitation, or CPR), enhanced 9-1-1 for use by the public in summoning emergency services, and the release of a 1966 white paper prepared by the Committee on Trauma and Committee on Shock of the National Academy of Sciences, National Research Council, that we have the EMS system that we are familiar with today (Department of Transportation, National Highway Traffic Safety Administration, 1996). It was about this time that the Department of Transportation (DOT) was given purview over EMS at the national level with the passage of the National Highway Safety Act of 1966.

During the 1970s, EMS had transitioned from mostly untrained funeral home drivers to providers trained by emergency physicians to treat many of the life-threatening scenarios that prevent people from seeking medical attention at hospitals, such as traumatic injuries, cardiac arrest, and many breathing problems. Since this time, there have been a number of concerted efforts and official recommendations by the DOT to augment and improve the delivery model of EMS throughout the country (Department of Transportation, National Highway Traffic Safety Administration, n.d., 1996, 2008). As early as 1996, the DOT published the vision of the future of EMS:

Emergency medical services (EMS) of the future will be community-based health management that is fully integrated with the overall health care system. It will have the ability to identify and modify illness and injury risks, provide acute illness and injury care and follow-up, and contribute to treatment of chronic conditions and community health monitoring. This new entity will be developed from redistribution of existing health care resources and will be integrated with other health care providers and public health and public safety agencies. It will improve community health and result in more appropriate use of acute health care resources. EMS will remain the public’s emergency medical safety net. (Department of Transportation, National Highway Traffic Safety Administration, 1996, p. iii)

Even as today’s emergency rooms, operating suites, and trauma centers throughout the world are overflowing capacity with an increasingly deficient workforce, EMS is expected to answer the call for help as the front-line of a fractured and inefficient health care system (Kellermann, 2006; Mason, Wardrope, & Perrin, 2003; O’Meara et al., 2006; Washko, 2012).

Hampered Efforts

EMS is known throughout the United States as rapid responders in times of medical and traumatic emergencies; however, ever-increasingly, EMS is being used as the front-line alternative to primary care for the non-emergent uninsured and under-insured patient population (Heightman & McCallion, 2011; Washko, 2012). There is a limited number of ambulances, EMTs, and paramedics available at any given moment, which is subject to financial constraints, and non-emergent use of these resources prevents their availability for when a true emergency arises. Secondary to the mission of providing care to the public, EMS is also needed to provide services for fire department and police department operations, such as firefighter rehabilitation at fire scenes and tactical medicine in concert with bomb squads, S.W.A.T. teams, and hazardous materials teams.

EMS resources are costly, and overburdened systems are negatively affected when these resources are misused, especially by those who are unwilling or unable to pay for the services.

Financial Impact

According to the DOT (2008) EMS workforce report, employers reported difficulties in retaining EMTs and paramedics partly due to the inability to raise wages or provide better fringe benefits. The report goes on to show that EMTs and paramedics suffer a wage disparity when compared to other similar public safety ($12.54/hr vs. firefighters: $26.82/hr; police officers: $22.25/hr) and health care workers (licensed vocational nurses and licensed practical nurses: $16.94/hr; respiratory therapists: $21.70/hr; registered nurses: $26.28/hr). In the five years leading up to 2005, the average wage for EMTs and paramedics grew only by $0.29/hr. It is important to note that these numbers do not take cross-trained firefighters and police officers into consideration.

Furthering the concern of wages, as the DOT (2008) report shows, is the lack of growth potential within EMS as most systems lack the ability to provide a meaningful career ladder to the EMTs and paramedics in their employ. These circumstances together create the scenario that EMS is an underpaid dead-end job causing high attrition as most EMTs and paramedics either suffer from burnout, culminated psychological stress from the job, or use the profession as a stepping stone into other health care fields, such as nursing, respiratory therapy, or physician-level medicine.

The DOT (2008) report provides evidence that transport-based reimbursement policies are likely to blame for the unusually low profit margin in EMS (Heightman & McCallion, 2011). The Medicare and Medicaid programs, as well as many private insurers, require documentation that the transport of a patient be medically necessary before they will pay; however, the Medicare and Medicaid reimbursement rates are very low and do not cover the cost of EMS operations. To complicate the matter, EMS providers are mandated by law to provide care to the public regardless of their insurance status or ability to pay (Heightman & McCallion, 2011). EMS is subsidized by either taxes or insurance reimbursement or some combination of the two.

Broad Mission

In addition to providing for the mundane care and transportation of the ill and injured and performing ancillary duties for the police and fire departments as noted above, EMS is tasked with disaster preparedness – preparing for the major incident that is highly unlikely to occur but would be devastating to lives and infrastructure if it does. That is if the EMT or paramedic is employed for an emergency service. Many of the EMTs and paramedics, today, are employed by private ambulance services who transport non-emergent patients to and from skilled nursing facilities and doctors’ offices. The multitude of these EMTs and paramedics are not considered when planning for emergency response schemes.

I consider EMS to be the caulking used to fill many of the fractures and gaps in today’s health care system. If it occurs outside of the hospital, then EMS will take responsibility, yet, they seldom get paid for their actions.

Proposed Solutions

There has been much talk over the past few years regarding the efficacy and efficiency of EMS, and all agree that the current definitive model is inefficient with, at best, questionable efficacy. Washko (2012) describes in detail the number of EMS schemes and their shortfalls. In his article, Washko is correct in stating that transport-based reimbursement policies fail to reward the greater EMS community for their willingness to take on further responsibility within the two scopes of operation: public health and public safety.

Wingrove and Laine (2008) explore the opportunity for training and equipping the most experienced paramedics for a public health centered role delivering community-based care. These community-based paramedics are described as augmenting the traditional emergency responder role with opportunities to direct patients to more appropriate care, such as doctor’s offices and urgent care centers instead of hospital emergency departments when appropriate to their condition. This model was researched recently in Australia with good results, and is now a recommended career path both there and in the United Kingdom (Mason, Wardrope, and Perrin, 2006; O’Meara et al., 2012). In the U.S., EMS professionals feel a responsibility to participate in disease and injury prevention efforts, and research on models that utilize specially-trained paramedics to perform home safety inspections, hazard mitigation, and reduce the risks of injuries to children have proven effective (Hawkins, Brice, & Overby, 2007; Lerner, Fernandez, & Shah, 2009). Hennepin Technical College, in Minnesota, now offers certification in Community Paramedic training when the recommended curriculum is provided by an accredited college, according to Wingrove and Laine.

Other, more immediate (but, arguably, less meaningful) solutions, as Washko (2012) describes, are incorporating operational tactics that better utilize ambulances by attempting to predict call volumes and locations based on historical data, the high-performance model. This, however, creates high-call volume, less resource driven scenarios with ambulances idling on street corners awaiting the next call. As mentioned earlier, attrition is a significant concern in EMS and these tactics are demanding on providers physically and psychologically leading to high incidences of burnout and injury (Department of Transportation, National Highway Traffic Safety Administration, n.d., 2008).


The standard operational benchmarks of EMS – response times and mortality and morbidity of cardiac arrest – are antiquated measures and typically distract policymakers when they are considering financial incentives for EMS (Heightman & McCallion, 2011; Washko, 2012). EMS needs to evolve with the changing health care system, and I feel that it is poised, specifically, to help address disparities in health and health care. Using the community-based paramedic model of health care delivery, we can address many public health concerns, provide for public safety, and still maintain the traditional role of emergency responder. The community-based paramedic model will provide an acceptable alternative to the options that lie ahead.

The economics of health care is a reality that must be considered by every EMS operation when approaching growth and change. As long as EMS can fill the gaps in the current health care system, it will be worth the money required to subsidize a robust, well-trained, and well-equipped contingent of emergency medical professionals. In the meantime, though, EMS agencies will have to seek more efficient models that maximize reimbursement while minimizing costs.


Committee on Trauma & Committee on Shock, Division of Medical Sciences, National Academy of Sciences, National Research Council. (1966). Accidental Death and Disability: The Neglected Disease of Modern Society. Washington, D.C.: Author.

Department of Transportation, National Highway Traffic Safety Administration. (n.d.). A leadership guide to quality improvement for emergency medical services (EMS) systems (Contract DTNH 22-95-C-05107). Retrieved from http://www.nhtsa.gov/people/injury/ems/Leaderguide/index.html

Department of Transportation, National Highway Traffic Safety Administration. (1996). Emergency medical services: agenda for the future (DOT HS 808441 – NTS-42). Retrieved from http://www.nremt.org/nremt/downloads/EMS%20Agenda%20for%20the%20Future.pdf

Department of Transportation, National Highway Traffic Safety Administration. (2008). EMS workforce for the 21st century: a national assessment. Retrieved from http://secure.naemse.org/services/EMSWorkforceReport.pdf

Hawkins, E. R., Brice, J. H., & Overby, B. A. (2007). Welcome to the World: Findings from an emergency medical services pediatric injury prevention program. Pediatric Emergency Care, 23(11), 790-795. doi:10.1097/PEC.0b013e318159ffd9

Heightman, A. J. & McCallion, T. (2011). Management lessons from Pinnacle: Key messages given to EMS leaders at the 2011 conference. Journal of EMS, 36(10), 50-54.

Kellermann, A. L. (2006). Crisis in the emergency department. New England Journal of Medicine, 355(13), 1300-1303. doi:10.1056/NEJMp068194

Lerner, E. B., Fernandez, A. R., & Shah, M. N. (2009). Do emergency medical services professionals think they should participate in disease prevention? Prehospital Emergency Care, 13(1), 64-70. doi:10.1080/10903120802471915

Mason, S., Wardrope, J., & Perrin, J. (2003). Developing a community paramedic practitioner intermediate care support scheme for older people with minor conditions. Emergency Medicine Journal, 20(2), 196-198. doi:10.1136/emj.20.2.196

Mayer, J. D. (1980). Response time and its significance in in medical emergencies. Geographical Review, 70(1), 79-87. Retrieved from http://www.ircp.info/Portals/22/Downloads/Performance/Response%20Time%20and%20Its%20Significance%20in%20Medical%20Emergencies.pdf

National Traffic and Motor Vehicle Safety Act of 1966, Pub. L. No. 89-563, 80 Stat. 718 (1966).

O’Meara, P., Walker, J., Stirling, C., Pedler, D., Tourle, V., Davis, K., … Wray, D. (2006, March). The rural and regional paramedic: moving beyond emergency response (Report to The Council of Ambulance Authorities, Inc.). Retrieved from http://www.ircp.info/Portals/22/Downloads/Expanded%20Role/The%20Rural%20and%20Regional%20Paramedic%20Moving%20Beyond%20Emergency%20Response.pdf

Washko, J. D. (2012). Rethinking delivery models: EMS industry may shift deployment methods. Journal of EMS, 37(7), 32-36.

Wingrove, G. & Laine, D. (2008). Community paramedic: A new expanded EMS model. Domain3, 32-37. Retrieved from http://www.ircp.info/Portals/22/Downloads/Expanded%20Role/NAEMSE%20Community%20Paramedic%20Article.pdf

Penn State: Analysis of Crisis Communications

On November 5, 2011, Jerry Sandusky, former Pennsylvania State University assistant football coach, was arrested on a number of counts of sexual assault on a minor. The arrest stems from incidents relating to The Second Mile charity, founded by Sandusky, and its association with Pennsylvania State University over the course of 15 years (Garcia, 2011; “Sandusky,” 2011). Two days later, the Pennsylvania State University athletic director, Tim Curley, and senior vice president for finance and business, Gary Schultz, surrendered to police to answer charges for failing to notify authorities for suspicions of sexual abuse of a minor (“Officials,” 2011; “Sandusky,” 2011). In two more days, Joe Paterno, head coach of the Pennsylvania State University football program, resigned over the controversy surrounding the university and its football program (Garcia, 2011; “Sandusky,” 2011). Within days of the arrests (and, before all the facts are known), the university was being severely criticized in the media (Zinser, 2011). This public relations nightmare is an example of how leveraging a crisis communication plan is important in communicating with the public.

Trivitt and Yann (2011) present this case as a reminder that crisis managers cannot fix every problem: “we think it’s important that, as a profession, we don’t overreach and try to uphold our work as the savior for every societal tragedy and crisis. Doing so makes us look opportunistic and foolish considering the gravity of the situation” (para. 13). In the case of Pennsylvania State University, there were a number of glaring failures to report the assaults to the authorities. Still, Sandusky was allowed to have unsupervised interaction with these adolescent boys until an investigation was launched in 2009 after one of the victims notified the authorities (“Sandusky,” 2011). Pennsylvania State University authorities should have reported the accusations to the proper authorities and released a statement to the media as soon as they were made aware, saving the administration from this crisis (Sudhaman & Holmes, 2012). The perception, however, is that there was a cover-up of moral corruption. There were a number of moral requirements that university representatives failed to acknowledge over the past years, and the character and esteem of the school will suffer for it.

Immediately after the revelation of these transgressions, the Pennsylvania State University administration clambered to make the proper attempts towards repairing the school’s suffering reputation, including donating $1.5-million of profits received from the renowned football program to sex crimes advocacy projects, discontinuing the school newspaper’s sex column, and providing a town hall- type venue where concerned students could present their questions and concerns directly to school officials (Sauer, 2011). Ultimately, these steps are proper; however, the only means of reclaiming and recapturing the admirable reputation that Pennsylvania State University once held is time and requires purging those administrators who appear sullied by this controversy. This does not, however, mean that Pennsylvania State University is languishing. According to Reuters (Shade, 2011), applications to attend Pennsylvania State University have increased in the last year, and the current school administration, as well as alumni, are uniting to restore the trust between the school and students.

Further, Singer (2011), a crisis communications and reputation management specialist, outlines the steps necessary for the school to truly enhance its brand. Singer highlights cleaning the slate by terminating any employees explicitly related to or having perpetuated the crisis, creating a team-centric leadership culture by restraining the political power of any one person within the school (especially the lead coach), and living the values that are proffered by the school (e.g. “Success With Honor”). If the crisis is handled appropriately from this point forward, the school’s reputation will be judged not the crisis itself.


Coombs (2012), Fearn-Banks, (2011), and Hendrix and Hayes (2010) all agree that crises are unexpected events that are difficult to anticipate; however, the communications focus should not be placed on specific problems that have a low probability of materializing but to have broad and general preparations in place to address unanticipated concerns as they arise.

Hendrix and Hayes (2010) provides an emergency checklist that organizations could adopt to better prepare to respond rapidly to a crisis. Analyzing the Pennsylvania State University response in retrospect by applying the concepts within this checklist will show how poorly prepared the administration was in responding to this crisis. What is glaring in the analysis is that the administration was on the defensive throughout the entire crisis. It seems that they were either unwilling or unable to get in front of the story. Hendrix and Hayes, as well as Coombs (2012) recommends utilizing a central resource as a clearinghouse to disseminate information to and from external publics. This communications center could also serve as an incident knowledge-base for those internal publics requiring more information. Further, preparation, again, is explicitly stated and is a requirement to quickly respond to media inquiries within the hour recommended. Although it is unclear if Pennsylvania State University incorporated a public information center, it was clearly not effective if it was, indeed, instituted.

Another issue that was contentious throughout the crisis and gave the appearance of a cover-up was the lack of full disclosure on the part of the university. It is understandable that the administration might have been caught off guard; however, this is no excuse to appear defensive and largely silent.

The Pennsylvania State University administration later contracted with a public relations firm to restore the reputation of the university. This should have been done much earlier.


Coombs, W. T. (2012). Ongoing crisis communication: Planning managing, and responding (3rd ed.). Thousand Oaks, CA: Sage.

Fearn-Banks, K. (2011). Crisis communications: a casebook approach (4th ed). New York, NY: Routledge.

Garcia, T. (2011, November 9). Paterno announces retirement, says Penn State has bigger issues to address. PRNewser. Retrieved from http://www.mediabistro.com/prnewser/paterno-announces-retirement-says-penn-state-has-bigger-issues-to-address_b29902

Hendrix, J. A. & Hayes, D. C. (2010). Public relations cases (8th ed.). Boston, MA: Wadsworth Cengage Learning.

Officials seeking alleged abuse victims. (2011, November 9). ESPN.com. Retrieved from http://espn.go.com/college-football/story/_/id/7203566/penn-state-nittany-lions-sex-abuse-case-officials-arraigned-police-seek-alleged-assault-victim

Sandusky, Penn State case timeline. (2011, November 9). ESPN.com. Retrieved from http://espn.go.com/college-football/story/_/id/7212054/key-dates-penn-state-sex-abuse-case

Sauer, A. (2011, December 1). Penn State bogs down in PR crisis, but a turnaround already showing. brandchannel. Retrieved from http://www.brandchannel.com/home/post/2011/ 12/01/Penn-State-Bogs-Down-In-PR-Crisis-120111.aspx

Shade, M. (2011, December 1). Penn State officials say applications up despite scandal. Reuters. Retrieved from http://www.reuters.com/article/2011/12/01/us-crime-coach-students-idUSTRE7B00GD20111201

Singer, J. (2011, December 7). The Penn State scandal: crisis as opportunity. The Business of College Sports. Retrieved from http://businessofcollegesports.com/2011/12/07/the-penn-state-scandal-crisis-as-opportunity/

Sudhaman, A. & Holmes, P. (2012, January 25). The top 10 crises Of 2011. The Holmes Report. Retrieved from http://www.holmesreport.com/featurestories-info/11377/The-Top-10-Crises-Of-2011.aspx

Trivitt, K. & Yann A. (2011, November 9). Public relations won’t fix Penn State’s crisis. PRSay. Retrieved from http://prsay.prsa.org/index.php/2011/11/09/public-relations-wont-fix-penn-states-crisis/

Zinser, L. (2011, November 9). Memo to Penn State: Ignoring a scandal doesn’t make it go away. The New York Times. Retrieved from http://www.nytimes.com/2011/11/10/sports/penn-state-fails-a-public-relations-test-leading-off.html?_r=1&ref=sports

Discussing Cost-Effective Analysis

This week I was directed to provide insight to the cost-effective analysis (CEA) provided by Penner (2004) in A Cost-Effective Analysis for Proposed Alternative Interventions to Post-Procedure Surgical Pain Reduction. Within the CEA, three alternative treatments (guided imagery, hypnosis, and biofeedback) are proposed to reduce post-operative pain. The CEA is used to determine the efficiency that each intervention offers comparably to each of the other two alternatives.

I developed a PowerPoint™ presentation [click here] to provide a summation of the CEA and visually present the information for a quick rationalization of the chosen intervention. I will explain each slide of the PowerPoint™ as it pertains to the CEA.

The Cost-Effective Analysis

The CEA provided by Penner (2004) describes the various costs and benefits of using guided imagery, hypnosis, and biofeedback therapies to reduce post-operative pain (as defined on slide #3), which improves the overall healing process. The objective, as noted on slide #2, is the importance of effective pain control. The author of the CEA concedes that all three interventions similarly meet the therapeutic objective of limiting post-operative pain in a safe and low-risk manner; however, the cost differences are significant.


As provided in the CEA, the most significant tangible benefits, as mentioned above, are providing effective pain management in a safe, low-risk manner. Additionally, and as a result of reducing pain effectively, increased patient satisfaction, better patient compliance, and overall better healing leads to reduced costs associated with post-operative recovery, such as reduced length of stay and reduced need for post-surgical care (e.g. nursing care, physician care, rehospitalization, medications). Slide #4 of the presentation outlines these similar benefits.


The costs of each intervention are significant factors in deciding which intervention to promote. Once the annual cost for each intervention if figured, each of the identified costs are distributed across the expected patient volume of 197 and further distributed over the likelihood of each of three surgical procedures (spinal fusion, total hip replacement, and auto hema stem cell transplant) being performed. Though this is largely unnecessary, it does provide perspective for how the costs will be distributed and raise the overall cost for each surgical procedure performed, as shown on slide #8. The total annual cost for each intervention, as well as the per-patient cost, is outlined on slide #5 and graphed on slides #6 and #7.

The fixed costs for guided imagery include a psychology consultant, a surgery PA coordinator, wages for clerical staff, and training for the surgery PA.

The fixed costs for hypnosis includes a psychologist skilled in hypnotherapy and wages for clerical staff. The amount of resources for hypnosis are significantly less than for guided imagery; however, the intervention is more substantial requiring significantly more hours per week paid (12 for hypnosis vs. 2 for guided imagery).

The fixed costs for biofeedback are more equivalent to, though slightly more than, those of guided imagery. Biofeedback requires a psychology consultant, a surgery PA coordinator, wages for clerical staff, and training for the surgery PA, but the fixed costs for biofeedback also include specific equipment, including skin sensors, two video monitors, VCRs, and carts.

The total identified costs for guided imagery is 32.18% less than biofeedback and 64.56% less than hypnosis.


Based on the CEA, the most cost-effective intervention for impacting and controlling post-operative pain on patients undergoing one of the three surgical procedures outlined is guided imagery. This result is stated on slide #10.


The appropriate management of pain is crucial to patient care. Assuming that the three interventions investigated are equally effective towards the objective of reducing and controlling pain, the cost of each intervention is the deciding factor when considering which of the three interventions to employ. In this case, guided imagery is the most cost-effective intervention and is the recommended intervention, per the CEA.

It is important to understand that these costs will be borne by not one but three different departments – the pain clinic, the orthopedic surgery department, and the patient education department. This cost-sharing removes the burden of providing the intervention from a single department and disperses the burden over the budgets of three different departments.


Penner, S. J. (2004). Introduction to health care economics & financial management: fundamental concepts with practical applications. Philadelphia, PA: Lippincott Williams & Wilkins.

Financial Statements:

What to Use, When to Use It

Accounting in health care is very important in order to understand the economic health of the organization. Without understanding the financial status of the organization, directionality of growth and prosperity is certainly in question; however, with financial statements as a guide, one can make informed and logical decisions to develop a strategic plan to direct organizational growth in a fiscally responsible nature.

Ittelson (2009) and Penner (2004) outline the various financial statements and how they are used. I will review three financial statements (the balance sheet, the income statement, and the cash flow statement) and the means to use the values on these statements to provide meaning, through the use of ratio analysis, of the fiscal health of the organization.

Financial Statements

Balance Sheet

The balance sheet is one of two main organizational financial statements. Ittelson (2009) outlines the balance sheet as showing assets = liabilities + worth, in that the value of an organization’s assets (or, what an organization has) is the sum of the organization’s liabilities (or, what is owed) and worth (or, the value of the organization to the owners).

Assets are usually listed on the balance sheet in order of liquidity and include everything valuable within an organization, including cash, accounts receivable, any inventory (included at depreciated value, if applicable), expenses that were prepaid, and any other intangibles that offer intrinsic value to the organization (Ittelson, 2009; Penner, 2004).

Liabilities, according to Ittelson (2009), are listed on the balance sheet as groupings of term (short- and long-term) and include current liabilities (accounts payable, expenses, portions of contracted debt currently payable, and taxes), long-term debt (or, contracted debt payable outside of the bounds of the current statement), and shareholder equity (or, the sum of capital stock value and the amount of retained earnings). The shareholder equity is also the worth of the organization.

By definition, the balance sheet must be balanced in the end with the value of the assets being the total liabilities and equities offset by the shareholder equity. The balance sheet, with this comparison, provides the fixed financial picture of the organization at any particular date.

Income Statement

The income statement, which describes an organization’s profitability, is the other main financial statement of an organization (Ittelson, 2009). The income statement details the value of inputs and expenses required to develop a specific income for a defined period of time; however, according to Ittelson (2009), it does not provide timing on payments or an assessment of how much cash the organization has on hand.

The income statement accounts for the gross margin (net sales vs. cost of goods sold), operating expenses (e.g. sales and marketing, research and development, and general and administrative expenses), interest income, and income taxes to derive net income (Ittelson, 2009; Penner, 2004).

As the organization’s net income increases, reflections of increased assets or decreased liabilities will be seen on the balance sheet. Likewise, this link will also show the reverse to be true as decreased assets or increased liabilities (Ittelson, 2009).

Cash Flow Statement

The cash flow statement, as noted by Ittelson (2009) and Penner (2004), simply describes the movement, or flow, of cash within the organization. Starting with the amount of cash on hand at the beginning of the reporting period, the cash flow statement tracks how cash is paid and received, such as cash receipts and disbursements, purchases of fixed assets, money borrowed, stock sales, and taxes paid, ending with the amount of cash on hand at the end of the reporting period. However, this statement does not account for receiving inventory or delivering finished products to customers as these would account for non-cash transactions. Only when the organization pays for the inventory or the customer pays for the product would it affect the cash flow statement.

According to Ittelson (2009), the cash flow statement describes the velocity of cash, exclusively, within an organization, and accounts for a portion of the organization’s assets as well as some new liabilities (such as a new mortgage or loan) and old liabilities (debt being paid).

Ratio Analysis

Although the financial statements described above describe the general financial health of an organization, the relationships of particular items within those reports can provide more specific indicators of financial condition (Ittelson, 2009; Penner, 2004). The use of these relationships is called ratio analysis.

Ratio analysis can help to determine factors, such as profitability, liquidity, asset management, and leverage. Ratio analysis can also help to compare various organizations among various industries by using a statement conversion to “common size” (Ittelson, 2009, p. 194), which represents items as percentages of the largest item on each statement.

Profitability, according to Ittelson (2009), is the ability of an organization to generate a return of profit on equity, sales, and assets. The gross margin, as a percentage, is also a profitability ratio analysis.

Liquidity, as opposed to the measure of returning a profit, is a measure of an organization’s ability to maintain a financial cushion and show financial strength.

Asset management ratios are measures of the efficient or inefficient use of assets and the time generally taken from using inputs to receiving payment. According to Ittelson (2009), “asset management ratios provide a tool to investigate how effective in generating profits the [organization’s] investment in accounts receivables, inventory [sic] and fixed assets is” (p. 198).

Leverage, much like liquidity, is a safety measure that describes the organization’s ability to absorb loss and meet obligations. The leverage safety cushion is also referred by Ittleson (2009) as the “equity cushion” (p. 202). Too much leverage is risky, but too little leverage decreases the ability to maximize profit and growth. Leverage is the use of other people’s money to augment the owner’s investment in order to maximize profits.


By using strict accounting guidelines and keeping accurate records, financial statements can be prepared that will provide insight into the financial health of an organization. These statements can help to compare the financial status of the organization at different times or to compare the organization with other organizations. Also, accurate financial statements will help to draw investors, secure lending opportunities, and comply with legal requirements.


Ittelson, T. R. (2009). Financial statements: A step-by-step guide to understanding and creating financial reports (Revised and expanded ed.). Pompton Plains, NJ: Career Press.

Penner, S. J. (2004). Introduction to health care economics & financial management: fundamental concepts with practical applications. Philadelphia, PA: Lippincott Williams & Wilkins.

Investment in Capital Improvements

To Buy or Not to Buy, That Is the Question

Outlays for capital improvements can be daunting, whether for a business or within a personal budget. It makes sense to invest in capital improvements when a realistic return on the initial investment can be expected. Computers, motor vehicles, and homes are all good examples of large personal investments that can generate significant returns or provide security that increases stability. In health care, outlays for expensive imaging devices, real property, and specialization programs can generate the same returns or stability to seek returns, especially when resulting from strategic business planning. Penner (2004) describes these outlays, or expenses, “as inputs or costs incurred in the process of producing goods and services” (p. 65). These inputs are designed to enhance existing revenues streams or provide for additional revenue streams.

Although health care budgeting is much more complicated than personal budgeting, the concepts are very similar. Penner (2004) demonstrates various types of budgets that account for many more revenue and expense items than is typically seen in personal budgeting. For instance, a hospital would account for every charge for every patient seen in each department seen. The hospital would also have to account for a number of expenses, such as personnel costs and the cost for each piece of patient care equipment (Penner, 2004). However, budgets can be consolidated and simplified the further they move from direct care (e.g. budget overviews used by the board of directors would not be so specific to account for each patient’s stay; instead, the budget overview would reflect revenues and expenses departmentally with references to the budgets of each specific department).

Recently, I made two large purchases that had to be budgeted: a) a Chevy Suburban (financed) and b) a Harley-Davidson motorcycle (cash). With both purchases, I needed to be sure that I needed the vehicle and I would benefit from the purchase. For the Suburban, because it was financed, required me to budget $500.00 / month; however, the vehicle allows me to get back and forth to work to earn my living, is reliable in all types of weather (important because I am required to report to duty even in severe weather), and maintains a high resale value. This purchase also required me to budget increased fuel costs due to poor fuel economy. The motorcycle purchase, admittedly largely recreational, also required significant forethought and budgeting; however, the excellent fuel economy certainly allows me to offset the Suburban’s fuel consumption during moderate weather. The motorcycle was also priced at a significant discount and requires little maintenance.

Again, the basics of budgeting are the same for business and personal finances; however, business budgets can get fairly complicated fairly quickly. For personal budgeting, the level of complexity is mainly determined by the needs of the individual. Tracking income and monthly bills requires little detail, though planning for a major future purchase or savings goal requires more significant accounting and detail.


Penner, S. J. (2004). Introduction to health care economics & financial management: Fundamental concepts with practical applications. Philadelphia, PA: Lippincott Williams & Wilkins.

Mind Your Own Business: Health Care Economics

Regardless of funding levels or overhead, health care must be provided ethically. The goal of the health care industry is to improve health, and unlike other industries, this market is driven not by choice but by need. Other markets perform, according to Friedman and Friedman (1980) and Smith (1910), only when mutual benefit can be achieved, that is, without external force, coercion, or unnatural limitation. Penner (2004) presents the economy of health care representative of many of the ideals that were accepted at the turn of this century. However, the current state of health care economics is the result of the unnatural force of these ideals in attempting to mold the market against natural market pressures, as described in detail and warned against by Friedman and Friedman and Smith.

Health care demand is based on need. Within that need, demand is reflective of pricing. For example, patients do not elect coronary bypass surgery, but if needed, the demand could be reflected by pricing constraints realized in negotiations of hospitals and insurance carriers. In this case, the patient may be transferred to a center that has negotiated reduced rates with the carrier for coronary bypass procedures. Ergo, health care demand is reflective of patient need and is variable only in the context of insurance pricing. It is within this negotiation that the aspects of quality, access, and cost are accounted. Government policy, however, has a negative and downward effect on these negotiations. If health care institutions are perceived to be able to provide the same services at discounted prices for government payors, then the institution should be able to provide these same services to private payors for the same or similar cost. This cost adjustment conversely affects quality and access.

Penner (2004) makes a logically flawed argument in respect to regulation arguing that increases in skilled nursing facility (SNF) safety regulations created a demand for more nursing assistants; however, this is an increased input to be provided by the SNF, not an output to be demanded by the patient. The cost will be borne by the private insurance payor, ultimately, and not the regulatory agency or the patient, which increases premiums decreasing access to private health insurance. Regulations negatively impact the relationship between supply/demand, quality, access, and cost. This is not to say that safety should not be a concern, as it is one of the few areas that I agree should be regulated, though, minimally.

Penner (2004) goes on to state “one role of government is to intervene in cases of market failure” (p. 21), using the pharmaceutical industry as an example. Unfortunately, with the focus on the new and significant health care and health insurance legislation and regulation, many academic discussions surrounding health care economics are now outdated and trivial. Without entertaining a constitutional debate, recently, governmental involvement has shown to have a negative effect on the health care industry actually causing market failures instead of alleviating them. Recent over-regulation by government on the pharmaceutical industry has resulted in a significant and dangerous shortage of life-saving emergency medications (Malcolm, 2012). This economic constraint will lead to higher demands of other, inferior, medications and increase the price, effectually increasing cost and decreasing both access and quality. This effect is also seen in the emergency medical services when states fix the price that can charged to users leaving the municipal taxpayer to face tax increases or decreases in access to emergency services and the quality of the services delivered (American Ambulance Association, 2008). Over-regulating an industry without regard to survivability is inefficient and unethical, limiting access and quality while increasing costs.

Insurance companies have sought to minimize their exposure to the rising costs of health care (Penner, 2004). By developing common sense incentives, insurers can advocate for their customers financially while expressing desire for optimal outcomes. By maximizing consumer and provider choice, these incentives can be used as natural pressures within the market to improve upon cost, quality, and access (Penner, 2004). This realization, according to Penner (2004), resulted in the emergence of the health maintenance organization (HMO) — the first widely accepted form of managed care. Unfortunately, HMOs faced scrutiny in the 1990’s and later augmented business models to reflect newer preferred provider organizations (PPO) and point-of-service (POS) plans. PPO and POS plans were created to promote the more inexpensive use of general providers and those providers that have negotiated fees. Unfortunately, Penner writes, the pressures of these PPO and POS plans on the consumer limit choice within the market; however, the consumer still has a choice of insurance carrier, which minimizes the pressure faced within each plan. This freedom is not expressed in governmental plans, such as Medicare and Medicaid.

As health care costs rise, the writings of Friedman and Friedman (1980) and Smith (1910) would suppose that we lessen regulation within the industry, allow new and novel approaches to insurance paradigms, and create an environment with as little unnatural market pressures as possible in order to allow natural market pressures to ensure equitable cost, access, and quality through competition


American Ambulance Association. (2008). EMS structured for quality: Best practices in designing, managing and contracting for emergency ambulance service. Retrieved from fitchassoc.com/download/Guidebook-April08-V2.pdf

Friedman, M. & Friedman, R. D. (1980). Free to choose: a personal statement. Retrieved from http://books.google.com/

Malcolm, A. (2012, January 4). Vast web of federal regulation causing drug shortages. Investor’s Business Daily. Retrieved from http://news.investors.com/article/596775/201201041859/big-government-behind-drug-shortages.htm

Penner, S. J. (2004). Introduction to health care economics & financial management: Fundamental concepts with practical applications. Philadelphia, PA: Lippincott Williams & Wilkins.

Smith, A. (1910/1957). The wealth of nations (Vol. 1). Retrieved from http://books.google.com/

Human Resource Challenges

Human resource management is a comprehensive support paradigm for both the employer (and his or her agents) and the employee. Most of the discussion regarding human resources revolves around problem employees and how human resources management can be used to deal with them. This week, however, we get to appreciate how human resources management can be effective at mediating employee concerns. Presented with two scenarios involving employee concerns, we will choose one and explore the fundamentals of human resources management as it relates to the challenges presented.

Throughout the past two weeks, Paul, a physical therapist, has been receiving in his work e-mail inbox some disturbing messages from an unknown sender. Many of the messages are sexual in nature and some even refer to Paul’s coworkers. Paul has reluctantly confided in the head of the organization’s HR department to help him with the issue. He is very embarrassed about the situation and is concerned that an investigation might jeopardize his relationships with coworkers and even his position with the organization.

As internet technology and systems management is a forte or mine, it is difficult for me not to take the easy path by selecting scenario 1. For this scenario, Paul would only have to enlist his manager in engaging the IT department to track the emails, which is a very simple process (most people do not understand how much information is generated in server logs and attached to email messages). The sender of the offensive emails would be found out and dealt with, and/or future messages of this type would be blocked by the email server, and Paul would no longer be distracted by these offensive emails.

However, as I stated previously, I prefer a challenge and will review the problems and some potential solutions regarding scenario 2.

For the past year, the nurses’ union at Good Health Hospital has been meeting to discuss grievances against Good Health’s management. In particular, the nurses are concerned with the way managers treat them; many feel overworked, undercompensated, and underappreciated. They have recently submitted a proposal to Good Health’s executives asking for better management practices, an increase in nurse staffing, and better compensation and benefits for nurses. The executives have enlisted the help of Good Health’s HR department in addressing the concerns in the proposal; they are concerned about budget constraints as well as the possibility of a nurses’ union strike.

Scenario 2 involves organized employees threatening a work stoppage if, at least, some of their concerns are not mitigated. Work stoppages, or strikes, are detrimental to any organization. The nurses’ union at Good Health Hospital have presented grievances that are typical in health care (Fallon & McConnell, 2007). It is a wonder why these concerns were not identified early. As Fallon and McConnell (2007) point out, “the best time to address a problem is before it becomes a problem” (p. 281). In this case, effective management would have identified these concerns early and developed a plan, perhaps integrating potential solutions through the organizations strategic plan, and prevented the growing acrimonious and bitter discontent amongst the rank and file employees. Though Fallon and McConnell discuss various types of organizational leadership, I prefer to lead with libertarian values in mind; ergo, both respect and responsibility must be virtues of both employee and employer, and both must work hard for the other. Fallon and McConnell discuss how trust and mutual respect lends to an effective, efficient, and rewarding work environment. Unfortunately, in scenario 2, it seems that we are beyond mitigation and prevention and, legally and contractually, they must be addressed.

Good Health Hospital administrators should take heed to the complaints noted in the nurses’ grievances. Although many managers and adminstrators dislike unions, ignoring them is not the answer. In this case, the concerns are probably real. Fallon and McConnell (2007) tell how information pertinent to employer-employee relations does not typically transcend the ranks, and this set of grievances may be the first indication to upper management that there is an issue. Still, the hospital adminstration, depending on the organizational schema (for-profit, not-for-profit, public, private, et al.), has a responsibility to its stakeholders and must ensure both operational feasibility and cost containment. Answering to these grievances could jeopardize one or both of these. A work stoppage would be detrimental to the operation and prove costly while meeting the demands in full would unrealistically obliterate the profit margin (note: the demands are not listed within the scenario; however, we can infer that they are significant).

If I were in the position of dealing with these grievances, I would, first, separate the demands by genre: safety and ethics, emotion, and economics. First and foremost, any ethical or safety concerns should be dealt with immediately, anyway. By identifying and dealing with these issues first, the perception of a receptive and action-oriented administration is gained. The solutions for these issues can also be highly visible and can be made to work for the organization by way of press releases outlining improvements in safety if not mere visible changes in the work environment and culture. Second, addressing emotional issues, such as poor treatment by managers and the perception of a lack of appreciation, can be solved by the employees, themselves. For instance, a “grade your manager” program might be cost neutral and provide some insight for future coaching. This would also give a sense of the prevailing attitude of the employees in the way comment cards give businesses a sense of the clientele. Another way of addressing emotion is to direct each manager to inquire of their staff periodically about any minor concerns they might have. This would give a sense of open communications, something that appears to be lacking. Finally, it is time to address the economical concerns.

Many times, the pay and benefits that are offered to unionized workers are stipulated in the collective bargaining agreement. These, fortunately (or, unfortunately) cannot be changed until the contract is renegotiated. Ethically and respectfully, the compensation package should hover near market levels. Fortunately for Good Health Hospital, we have already addressed a few concerns, so we have latitude in addressing the economic issues. As Fallon and McConnell (2007) state, working conditions are just as important as financial incentives, and employees may sacrifice pay and benefits for a decent working environment.

Regardless of the hospital’s ability to meet the nurses’ demands, I would insist on meeting with them, out of respect, to hear their concerns; however, the meeting would be official and the labor relations attorneys would be present to ensure compliance to the National Labor Relations Board regulations.


Fallon, L. F. & McConnell, C. R. (2007). Human resources management in health care: principles and practice. Sudbury, MA: Jones and Bartlett.

Establishing S.M.A.R.T. Goals

“Employees learn better when they actually become involved in the process” (Fallon & MCConnell, 2007, p. 192), so what better way to grow than to define the process?!

Meyer (2006) outlines a methodology, referred to as S.M.A.R.T., of developing goals and a plan to attain them. The S.M.A.R.T. goal methodology that Meyer describes is reflected in the acronym of the name: specific, measurable, attainable, realistic, and time-bound. However, as Rubin (2002) points out, the acronym is dynamic and variable to include any number of variations: simple, specific, sensible, significant; meaningful, motivating; acceptable, achievable, action-oriented, accountable, agreed, actionable, assignable; realistic, reviewable, relative, rewarding, reasonable, results-oriented, relevant; timelines, time-frame, time-stamped, tangible, timely, time-based, time-specific, time-sensitive, timed, time-scaled, time-constrained, time-phased, time-limited, time-driven, time-related, time-line, toward what you want, and truthful. Even more dynamic, as Rubin points out, some add “efficacy” and “rewarding” making S.M.A.R.T. goals S.M.A.R.T.E.R. goals!

Regardless, however, of the actual mnemonic, the methodology represents the continuum of goal-analysis, goal-setting, and goal-attainment in a systematic manner that is tangible and results-oriented. The philosophy remains true and valid.

Setting a Goal

In the past, one of my goals was to obtain a college degree. I knew that I was intelligent and should have no problem, otherwise, attaining this goal, but life always seemed to place obstacles in my path. One day, not so long ago and with chiding from my father, I decided to put a date to this goal: December, 2012. I was lacking this one important motivational step for so long, but because I finally made my goal time-sensitive, I was finally able to measure my progress in a specific manner. I feel that because I developed a realistic time-line to attain this goal, I will obtain my bachelors degree this year.

Now that I am close to completing one goal, it makes sense to reflect and determine my next set of goals, but how can I apply the S.M.A.R.T. methodology of setting one? Reviewing Meyer (2006) and Rubin (2002), I find that, first, I need to conceptually understand that goals should be simple and realistic. Next, my goal needs to somehow be constrained by time so that it is measurable and my progress is quantifiable. Further, my goal, itself, needs to be motivating and rewarding.

My goal cannot be something as simple as make more money or be a better person. These goals are broader, I feel, than the methodology is designed for. However, breaking one of these goals down to measurable steps seems to be preferred. Instead of make more money, a more specific goal might be to earn a six-figure income by a set date.


According to Meyer (2006), the first question is if this goal is specific. Yes. If I continue to earn any less than $100,000 in a single year, I have not met my goal.


The next question: Is it measurable? For the same reasons that it is specific, it is measurable. Additionally, my progress is measurable by the year-to-date column of my paycheck, which should increase towards my ultimate goal amount.


Is this goal attainable? As I take stock of my current income and skill set with the addition of my bachelors degree and other certifications and licenses, I do feel that a six-figure income is attainable.


In order to be a realistic goal, others in my profession must have attained this goal, or I must be willing to change professions. I am hard-pressed to leave the emergency medical services, and there are a number of positions available within the emergency medical services that earn six-figures. These positions are mostly administrative in nature, but I feel that I have the experience to start considering these positions as realistic.


Setting a time-frame for completion of my last major goal underscores the importance of this step, but it is my weakness, and I acknowledge that. However, as I expect to obtain my bachelors degree later this year, realistically, I would have to give myself another year or two to find a position for which I could apply. I would, then, need another year in order to actually earn the income. The 2015 tax year seems appropriate, though unrealistic, perhaps. Still, I will set this time-line and reconsider each objective of my goal as 2015 draws closer.


Setting a goal is a difficult task. It is sometimes difficult to look to the future, and often times, we are haunted by our failings in the past. Using a methodology, such as S.M.A.R.T., can help us to reflect on realistic and meaningful goals that can ultimately help us work toward the more obscure long-term goals, like being affluent or saving the world.


Fallon, L. F. & McConnell, C. R. (2007). Human resource management in health care: principles and practice. Sudbury, MA: Jones & Bartlett.

Meyer, P. J. (2006). Attitude is everything. Retrieved from http://www.oma.ku.edu/soar/ smartgoals.pdf

Rubin, R. S. (2002). Will the real SMART goals please stand up? The Industrial-Organizational Psychologist, 39(4), 26-27.

Burnout: “What a Star—What a Jerk”

The character, Andy Zimmerman, in Cliffe’s (2001) fictitious hypothetical is obviously intelligent and hard-working; however, he appears to be suffering from “burnout”. Korczak, Huber, and Kister (2010) describe the contemporary definition of burnout as essentially equated to work-related syndrome, which is characterized by “emotional exhaustion, depersonalisation [sic] or cynicism and reduced professional efficacy” (p. 3); however, the authors acknowledge a plethora of symptoms, definitions, and theories in the literature and call for standardization for improved diagnosis and research. Maslach and Leiter (2010) describe burnout as “[reflecting] an uneasy relationship between people

and their work” (p. 44). In the case of Andy Zimmerman, it appears that he has depersonalized his work, evidenced by his egoism and rage towards his co-workers. Also, from reading the fictitious account, assumptions can be made: 1) Andy Zimmerman did not start his job by acting in such manner; therefore, this is a change that Jane Epstein would not be privy, and 2) Andy Zimmerman may feel that his work is falling from his own personal standard and finds blame in others, which goes towards his egoism. In all, these might account for some level of reduced professional efficacy. However, as Korczak et al. discuss, there is no valid diagnostic criteria of burnout and application is difficult as burnout has strong correlation with depression and alexithymia (see footnote 1), each of which could contribute to Andy Zimmerman’s attitudes and outbursts.

Employees who are suffering burnout or other psychosocial maladies have a negative and detrimental effect on other co-workers (Maslach and Leiter, 2010; Korczak, Huber, & Kister, 2010). In the case of Andy Zimmerman, his relationship with his work environment is certainly reducing the efficacy of others. Is it possible that Andy Zimmerman’s tirades are the only reason that he is the top performer? Could it be that culling inappropriate behavior would more than make up for the loss of one man’s productivity?

According to Fallon and McConnell (2007), many employees that are suffering personal problems to the degree that they interfere with work are able to benefit from managers pointing out how their work has been suffering, but employees that are identified as possibly suffering from burnout syndrome (or, any major personal problem that adversely effects work) should be referred to the employee assistance program, if at all possible. Fallon and McConnell go further to state, and rightly so, that managers should not give advice on personal matters but only provide a means of rectifying professional performance. Managers are poorly equipped to handle counseling of a personal nature. Instead, Fallon and McConnell demonstrate the utility of the progressive discipline model to both educate an employee about his or her responsibilities and allow him or her to rectify the situation. Unfortunately, however, behavior problems sometime end with termination, though “experts note that when an employee is released for a serious infraction, the problem has been corrected by removing its cause” (Fallon & McConnell, 2007, p. 260).

In regards to Jane Epstein’s troubles with Andy Zimmerman, double standards of employee conduct cannot exist (Fallon & McConnell, 2007). Jane must do something to quell the growing rift within her department. First, Jane must document everything in regards to Andy (Fallon & McConnell, 2007). This, most of all, will support the premise that Jane used all possible solutions before considering termination. Next, Jane should ensure that Andy understands that the behavior will not be tolerated any longer. This could, perhaps, be coupled with a statement referencing the employee assistance program or other route of anger management counseling. Finally, Jane might consider that the work being performed is not well matched for Andy. Mismatched work is a significant cause of burnout, and if this is suspected, Jane could discuss the potential for professional growth with Andy, which might alleviate the outbursts (“Don’t take your people for granted,” 2010; Maslach & Leiter, 2010). Finally, if Andy continues to fail to conform to the department policies, he must be terminated. Jane needs to view her responsibilities to the department over any she might feel towards a single employee (Fallon & McConnell, 2007).


Cliffe, S. (2001). What a star — what a jerk. Harvard Business Review, 79(8), 37–48.

Don’t take your people for granted. (2010). Healthcare Executive, 25(4), 40.

Fallon, L. F. & McConnell, C. R. (2007). Human resource management in health care: principles and practice. Sudbury, MA: Jones and Bartlett.

Hosoi, M., Molton, I. R., Jensen, M. P., Ehde, D. M., Amtmann, S., O’Brien, S., … Kubo, C. (2010). Relationships among alexithymia and pain intensity, pain interference, and vitality in persons with neuromuscular disease: Considering the effect of negative affectivity. Pain, 149(2): 273–277. doi:10.1016/j.pain.2010.02.012

Korczak, D., Huber, B., & Kister, C. (2010). Differential diagnostic of the burnout syndrome. GMS Health Technology Assessment, 6, 1-9. doi:10.3205/hta000087

Maslach, C. & Leiter, M. P. (2010). Reversing burnout: How to rekindle your passion for work. IEEE Engineering Management Review, 38(4), 91-96. doi:10.1109/EMR.2010.5645760


1. Alexithymia is defined as a lack of emotional awareness and the inability to identify or label emotions, which is demonstrated by difficulty identifying and describing feelings and difficulty with externally-oriented thinking (Hosoi et al., 2010).

2. In response to Cliffe’s (2001) “What a Star—What a Jerk”:

  • Mary Rowe calls on Jane to show laissez-faire leadership in which she does nothing directly but tries to “work with Andy” to come to a workable solution, relying on upper management to provide discipline. In the writing, Jane has already approached Andy and discussed his attitudes towards his co-workers; however, the positive result of this conversation was short-lived, and Andy reverted to his tactics of ill-temperment and hostility. In my opinion, these attitudes have no place in the workplace, and Jane should be adamant about this point before Andy directs his rage towards her, further undermining her authority.
  • Chuck McKenzie, however, makes some good points on how to work with Andy (so long as there is actual value in Andy remaining employed with TechiCo). Mr. McKenzie calls for some innovative changes in the organizational structure to separate Andy from the rest of the team, capitalizing on increased productivity all around. Additionally, creating a specialized team of high performers might alleviate burnout (if, in fact, that is what Andy is suffering) and demonstrate to Jane’s superiors that there are ways to isolate and reward top performers while tolerating average performers. Before doing anything, as Mr. McKenzie points out, Jane needs to become a leader and stop acting like a manager.
  • While Kathy Jordan elucidates more of the same philosophy as Chuck McKenzie in regards to leadership, she advocates trust and positivity between Jane and Andy. I feel that trust and positivity are a product of a viable working relationship and are more goals than standards. Ms. Jordan is right, however, that Jane must prove her mettle in a very short time.
  • Finally, James Waldroop provides some real insight into how Jane might best lead and mold Andy into a star employee. Either that, or Jane has started the time table for Andy’s departure. All in all, leaders need followers, and leaders cultivate followers; however, if a subordinate does not wish to follow, then the leader cannot lead or cultivate. In this case, the relationship has failed.

Employee Retention

I am familiar with a local EMS organization where the perception of the employee-base is that middle management sacrifices requisite supplies in order to regain budget losses, losses that were incurred due to their overall mismanagement. Sacrificing supplies in the emergency medical service arena equates to negligence and could, indeed, prove harmful to patients. This, coupled with the notion of incompetence, has a negative effect on morale, especially as this is one of the only divisions within the larger company that experiences these types of problems. Many have considered leaving (in fact, I have been told that most consider it quite often); however, the compensation package that they receive cannot be met by any other provider in the area. This leaves the employee in an ethical quandary. This issue is not isolated to this particular company, though. Although many private ambulance companies in the region face the same mismanagement, they do not offer comparable compensation packages and are much easier to leave.

Fallon and McConnell (2007) discuss how pay and benefits are vitally linked to overall job satisfaction, and I agree with their determination. However, there are other components, such as conscience. Duffy (2010) explains, in the light of pharmacists refusing to dispense abortion pills as a right of conscience, how “medical professions are among those where ethics and morality are of paramount concern” (p. 509). Consider Duffy’s explanation in reverse as this particular company is forcing their employees not to care for patients who they would otherwise be able to treat. The result is a significant emotional and psychological toll, I can imagine, but the employees cannot just walk away from their paycheck. This company, I feel, has learned to balance some of the positive working conditions with some of the negative working conditions, and the company relies heavily on wages and benefits to do so. According to Fallon and McConnell (2007), this tactic helps to relieve employee turnover rates; however, if the company would mitigate the negative aspects of the job, the wages and benefits offered could be used to attract employees with higher skill levels. Instead of leveraging ambition and affecting positive psychology within the workforce, as Amabile and Kramer (2011) recommend, the typical leverage is financial at a cost of ambition and morale.

In contrast, I have worked for agencies that paid far less in compensation than their competition, but the appreciation on the part of management was evident and allowed me to overlook the compensation gap with the other companies where the employees were always complaining and just seemed unhappy. Unfortunately, the gap grew to a point that was unbearable and I had to ultimately leave, but it was quite a while before I found another agency that commended professional evolution and progress, such as described by Amabile and Kramer (2011) — the company discussed above, however, is not.

Amabile and Kramer (2011) describe the withholding of resources to be a “toxin” that negatively effects morale. By improving supply requisition, a “catalyst” to improve morale, and improving recognition and supporting a free exchange of ideas, this company could improve morale significantly and focus on hiring skilled and experienced providers rather than those that will merely acquiesce to their ambiguous demands.


Amabile, T. M. & Kramer, S. J. (2011). The power of small wins. Harvard Business Review, 89(5), 70-80.

Duffy, M. E. (2010). Good medicine: Why pharmacists should be prescribed a right of conscience. Valparaiso University Law Review, 44(2), 509-564.

Fallon, L. F. & McConnell, C. R. (2007). Compensation and benefits. In Human resource management in health care: principles and practice (pp. 201-218). Sudbury, MA: Jones & Bartlett.