Publicness, Organisational Characteristics and Performance: An Investigation of Public and Private Hospitals in England

Publicness, Organisational Characteristics and Performance: An Investigation of Public and Private Hospitals in England

Stuart Anderson (London School of Hygiene & Tropical Medicine, London, UK)
DOI: 10.4018/ijpphme.2013010103
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Abstract

This paper reports an exploratory study utilising a publicness model in which the impact of ownership, funding and mode of control on performance is moderated by organisational characteristics such as goals, structure and management. It describes the testing in 164 English hospital pharmacies of four health sector-relevant characteristics; diffusion of ownership (number of owners), priority of financial goals, congruence of core purpose (goals of sub-unit compared to organisation), and proximity of control (hierarchical levels between sub-unit and top management). Associations between these and four indicators of performance (managerial effectiveness, utilisation of human resources, work quality and employee satisfaction) were examined. Statistically significant relationships were seen between three of the organisational characteristics and some aspect of performance. Priority of financial goals was associated with perceptions of managerial performance, and proximity of control with use of human resources, work quality and employee satisfaction. Further elucidation of such characteristics may be justified.
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Introduction

Of the many organisational studies of healthcare organisations reported, many aim to identify the impact on performance of a wide range of characteristics, processes and structures. The result has been a long and growing list of factors that may have some influence on performance. In healthcare the issue remains important, since in almost all countries budgetary constraints have placed enormous pressure on healthcare systems. A key question in the public/private debate is whether particular groups of goods and services are better delivered by government, the private sector, public-private partnerships or non-profit organisations (Rainey & Bozeman, 2000). Debates around the public or private provision of healthcare invariably revolve around the relative effectiveness of provision by one sector or the other (Hughes Tuohy, Flood, & Stabile, 2004). With growing organisational diversity in the sector the concept of publicness provides a means of exploring some of the issues involved; it has been viewed in several ways (Walker & Bozeman, 2011); as organisational ownership (Rainey, Backoff, & Levine, 1976), as the influence of political authority (Bozeman, 1987) or as the relationship between the two (Rainey & Bozeman, 2000).

Publicness and Performance

The public-private distinction has different implications in different sectors or industries; Hodge (2000) for example, found big differences when comparing hospitals with refuse collection: and Kelman (1985) has shown that public and private organisations in the same functional category do not necessarily do the same thing or operate in the same way; public and private hospitals may serve different patients and operate under different policy frameworks and rules. Such observations mean that careful specification of control variables is necessary in any comparative study.

A major review of the evidence on the impact of public versus private provision on performance has been undertaken by Andrews, Boyne and Walker (2011). They categorised studies according to three characteristics of publicness (ownership, funding and mode of social control-either market or polyarchy) and focused on three measures of performance; effectiveness, efficiency and equity. They found that publicness effects, and particularly those associated with ownership, diminish when differences in management, organisation and external constraints are taken into account. They noted, however, that the majority of the studies reviewed were underspecified, and that few included more than one dimension of publicness or tested for the effects of intervening variables. Future studies should explore the moderating effects of organisational characteristics between publicness and performance.

Publicness and Healthcare

One of the perennial questions in health services research is the relative productivity and efficiency of public versus private provision of healthcare. There has also been increased interest in differentiating healthcare organisations by means other than the traditional distinction between publicly and privately owned institutions (Allen et al., 2011). But such approaches have increasingly been shown to be inadequate in capturing the diversity of organisational forms that now exist in the sector.

Close inspection reveals that a simple division between public and private hospitals based solely on ownership is too simplistic, even in Britain with its state funded National Health Service. Whilst the aim of many studies of the relative performance of organisations in the public and private sectors has been to identify factors that contribute to increased performance, to date little attention has been paid to intervening variables between publicness and performance. The research question posed in this paper is this; are there health-sector relevant organisational characteristics in public and private hospitals in England which moderate the impact of publicness on performance?

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