STRATO CARE, is a non-profit health-care organisation composed of seven hospitals with about 2,000 beds and more than 200 clinic and outpatient locations, 1,200 physicians, and more than 7,500 other employees who work throughout the organisation. Several years ago, STRATO’ recognized that HR issues needed attention. Turnover rates of 24%, together with more than 500 unfilled positions, were costing the organisation more than €15 million annually.
Four years later, the turnover rates had declined to 12% and open positions had dropped to fewer than 100. Due to their improvements, STRATO’s HR practices, and especially its retention successes, won several local and national awards. STRATO’ was named one of the “Best Places to Work.” The award was based on surveys of employees that asked about several criteria, credibility, respect and fairness, pride, and camaraderie. STRATO CARE is the exception to the turnover levels in nursing. Compared with the health-care industry rate of 20%, STRATO’s turnover rate of 7.6% is exceptionally low.
Specifically, regarding retention efforts, STRATO’ created an Employee Retention Task Force whose focus was to decrease turnover and increase employee satisfaction. The task force identified several strategies to be used. One program illustrates how STRATO’ approached retention of nurses. The Nursing Residence Program has caught national attention. Each or new nurse is paired with an experienced nurse based on interests, personality, and so on. Also, a mentor outside the nursing department adds support and encouragement to individuals. Nursing staff meet monthly for training. In addition, they can visit various other departments (paediatrics, cardiology, etc.) in which they may have career interests.
In the Technical Division, technicians interested in management can shadow the department director to see how the department is managed. Technicians who are out in the field are given ongoing training every year, which is optional. For new pieces of equipment, when required, a specific training program is given to selected technicians at the head office; this may take some technicians away from their customers for several days. A key to aiding technician recruitment and retention is an extensive training and development program. Many different short courses and classes are provided to STRATO’ employees at no cost. As part of this program, STRATO’ pays up to €20,000 for employees selected for a career advancement program to obtain technical degrees.
The traditional pay structure at STRATO’ contains many pay grades and is based on job evaluations to establish those grades. Its performance review system emphasizes employee tenure and effort to a greater degree than performance results. To respond to the competitive environment, the firm’s executives decided that STRATO had to become more dynamic and able to change more quickly. One of the changes identified was that a new compensation system was needed.
Q1. Like many organisations STRATO CARE has long-term sustainability as one of their strategic goals. Discuss how the different stages of human resources planning may have helped the business to not only achieve some of its objectives e.g. reducing staff turnover rates, but also prepare them for potential future challenges in the work environment e.g. new technology, globalisation etc.
Q2. Briefly explain some of the different types of compensation pay systems available. Recommend an incentive pay strategy & structure that might be suitable at STRATO’ for a) Nurses and b) Customer service employees. Evaluate to what extent your recommendation will make STRATO one of the best places to work according to the criteria in the case.
Q3. There have been recent accidents at STRATO CARE amongst the staff in the Technical Division, involved in maintaining medical equipment leased out by the organisation. To improve the safety record in the division, suggest an orientation and training program for new and established employees at STRATO’. What important considerations should be included in this program and why? In the context of the case, assess potential weaknesses your program might contain.
Q4. STRATO CARE’ has a strategy of selecting employees for promotions from mainly within the organisation. Assess the degree to which this strategy is beneficial to a) the technicians and b) administrators at different levels of the organisation in this case.
Q5. The performance review system at STRATO’ seems to work but is antiquated. Describe in detail and analyse different ways in which performance could be evaluated of nurses and/or administrators in a more modern, results driven way at the organisation. What important outcomes should result from an appraisal of performance? Use researched examples to illustrate your response.