Hospital Organization

Hospitals continue to be the largest segment of the health care industry, measured by economic volume and delivery of a wide range of professional services. HEALTH CARE SERVICES The different segments of the health care delivery system provide various combinations of services. The specific combination offered depends on a variety factors that prevail in a location, including state and local licensing laws, reimbursement structures, availability of medical personnel and facilities, and the demographic details (such as age and industrial distribution) of the potential patient population.The unique aspect of the health care industry from an audit perspective is the health care delivery system – the revenue cycle. The other cycles are essentially similar to those in manufacturing or selling enterprises. Services are generally described by a six-level classification. Those levels indicate, but do not strictly define, the type of organization, the level of medical treatment involved , or the severity of, or prognosis for, the medical situation. The levels are: †¢Preventive – Health education and prevention programs provided by business and other organizations, such as schools and family planning clinics. Primary – Early detection and routine treatment of health problems, such as are often provided by physicians’ offices, industrial and school health units, and hospital outpatient and emergency departments.†¢Secondary – Acute care services, typically provided by medical personnel, through hospitals, using elaborate diagnostic and treatment procedures. †¢Tertiary – Highly technical services, such as for psychiatric and chronic diseases, provided through specialty facilities and teaching hospitals. †¢Restorative – Rehabilitative and follow-up acre, typically provided by home health agencies, nursing homes, and halfway houses. Continuing – Long-term, chronic care, typically provided by geriatric d ay care centers and nursing homes. The growing economic magnitude of the health care system has led to increased regulatory activities focusing on health care. This increase in regulation interacts with a growing demand for more health care and for increasingly technical and complex methods of providing it. The largest and most evident regulatory activity involves reimbursement by state governments. Other regulatory activities are concerned in varying degrees with the availability and quality of health care.There are continued initiatives by state government to link such regulations to reimbursement in order to enforce compliance. The presence of multiple regulatory systems influences the demand for and the nature of professional accounting services required by health care institutions. Those systems often emphasize reporting requirements, and health care institutions tend to view compliance reporting as a major use of accounting data. Auditing services in particular are affected be cause the regulatory agencies rely heavily on the attest activities of the health care institution’s independent accountant.STRUCTURE AND ORGANIZATION Patient care is the essential function of a hospital. Other vital roles include medical education and research. Recently, many larger general hospitals have become total community health centers, providing a wide range of outpatient services in addition to traditional impatient care. One characteristic of the growth of the health center concept is the emergence of such diverse related organizations as real estate holding companies and medical management companies.These organizations are a response to changes in the reimbursement, regulatory, tax and financial environment facing hospital management. Such nontraditional organizational structures and patterns of activity are needed to provide adequate financial resources to support the delivery of health care by hospitals. Some observers see these changes as leading to major multi hospital systems, so that in the future a few major health entities may control the majority of the hospital beds in the country. Hospitals may be classified by type of ownership and mode of operation, as follows: Government – Hospitals operated by governmental agencies and providing specialized services to specific groups and their dependents, such as the military, veterans, government employees, the indigent and the mentally ill. †¢Investor-owned (proprietary) – Hospitals owned by individual proprietors or groups of proprietors or by the public through stock ownership. The objective of such hospitals is to operate for profit. †¢Voluntary nonprofit – Hospitals operated under the sponsorship of a community, religious denomination, or other nonprofit entity.This is the largest category (in number of hospitals), comprising two major types: teaching hospitals and community hospitals. a. Teaching hospitals – Generally university-related hospitals, t heir health care service activities combine education, research and a broad range of sophisticated patient services. Large community hospitals affiliated with medical schools and offering intern and resident programs are also considered teaching hospitals. b. Community hospitals – Hospitals that traditionally are established to serve a specific area, such as a city, town, or county, and usually offer more limited services than teaching hospitals do.Hospitals may also be categorized by the type of care provided, as short-term (acute), general, long-term general, psychiatric, and other special care. The mode of a hospital’s operation and type of care occur in various combinations, such as government psychiatric or short-term pediatric. THIRD-PARTY REIMBURSEMENT OR PAYMENT A major difference between health care entities and commercial enterprises is that the recipient of health care services – the patient – in most cases does not pay directly for the service s. Instead, payment is made by some other organization.The payment is often referred to as a â€Å"third party†. Typically, a hospital’s most significant patient revenue sources are its reimbursement contracts with third parties. In each case, there is an identifiable group of patients whose health care services are paid for, in whole or in part, by the third party. The amount of the reimbursement, as well as the eligible class of patients and other administrative matters, is covered by regulations or contracts. The major third parties are governmental agencies. Of these, the state government is the largest.Medicard is state-administered third-party reimbursement program designed to underwrite hospital costs of the medically indigent and those eligible for certain types of public welfare. Medicare is a third-party reimbursement program administered by the Health Care Financing Administration of the Department of Health and Human Services. State governments have long be en involved in reimbursement for health care services, and their involvement has increased through participation in the Medicard Program. Recently, the continued growth of third-party expenditures for reimbursement has fostered a number of state-based cost control programs.Of increasing importance are a wide variety of controls at the state level, usually referred to by terms such as state rate control. The state government has been quite active in encouraging or supporting such programs. The impact of governmental and commercial third parties on hospital is affected by when the reimbursement or payment is determined and the basis of the reimbursement or payment. Third-party reimbursement systems are either retrospective or prospective. Retrospective refers to third-party reimbursement systems that determine the amount to be paid after the services have been performed.In prospective payment systems, the amount is determined before the services have been performed. Reimbursements or payments are usually based on either the costs (to the hospital) of services performed for eligible patients or the amounts charged by the hospital for such services. The regulations or contracts of the third party contain specific provisions designed to ensure that only certain costs or charges enter into the determination of the reimbursement or payment. There are also provisions to ensure that reimbursement or payment is made only for services to eligible patients.Third-party payers can be expected to continue to refine their approach as the volume of payments increases. The difference between the hospitals established rates for services rendered and the amounts received or receivable from third-party payers known as a contractual allowance and is shown as a deduction from gross patient revenues on the statement of revenues and expenses. PAYMENTS AND SETTLEMENTS Under many retrospective reimbursement and prospective payment contracts, the hospital is paid throughout the year on a n interim basis.The payment is based on estimates of costs expected to be incurred during the year in serving patients. At the end of the fiscal year, a reimbursement report is filed with each third party, and any difference between the final cost settlements, by providing an independent basis for third-party reliance on the hospital’s accounting records. Reimbursement reports typically include cost-finding calculations that segregate direct costs by cost centers and allocate overhead costs from indirect or nonrevenue-producing centers to revenue-producing centers, using one of several allocation methods.Departments that provide direct patient services such as nursing, laboratory, and radiology are examples of revenue-producing centers, while support or overhead units such as laundry, dietary, and administrative services are typical nonrevenue-producing cost centers. This allocation produces an operating cost for each revenue-producing center, consisting of its direct costs p lus its share of indirect costs. After all costs have been assigned to revenue-producing centers, they are apportioned to the various third-party payers. STATISTICSDepartmental activity or usage statistics are employed in most cost-finding methods used to allocate overhead costs to revenue-producing centers. Some statistics, such as square feet of space, may remain unchanged from prior years. The auditor should, however, inquire whether changes have occurred. Simple observation is helpful; a new wing, department, or floor plan means that statistics must be updated. Certain statistical information is generated by the various transaction cycles. Examples of statistics that are generated in the buying cycle are: Payroll pesos – Used to allocate employee benefits, health and welfare costs, and other compensation costs. †¢Hours worked – Used to allocate nursing administration costs and sometimes employee cafeteria costs. †¢Full-time equivalent employees (FTE) â₠¬â€œ Sometimes used to allocate employee cafeteria costs. Other statistics utilized in cost-finding and third-party reimbursement are generated by departmental activity studies and surveys. Examples of such statistics are pounds of laundry, housekeeping hours of service, social service hours, and cost of drugs and medical and surgical supplies issued to nursing stations.Medicare regulations require a study of at least four 2-week periods annually. FUND ACCOUNTING The audit guide prescribes the use of fund accounting for the external financial statements of nongovernment, not-for-profit hospitals. Fund accounting entails the maintenance of separate or group accounts for hospital resources according to the spending objectives set by donors, other outside sources, or the board of trustees. (Investor-owned hospitals are regarded as business enterprises and report as such. ) Two broad classes of funds are used: †¢Unrestricted funds, which encompass assets other than those that are r estricted, as defined below.Many authorities believe that this class of funds should be referred to as general and that the term unrestricted is misleading, since restrictions other than those imposed by donors or grantors may be placed on assets of these funds. A reserve account maintained under a bond indenture provision is an example of an asset that is included in unrestricted funds but is restricted as to use. †¢Restricted funds, which encompass assets that are subject to restrictions imposed by specified external parties, that is, donors or grantors. Examples are plant replacement and endowment funds. AUDIT STRATEGY AND RISK ASSESSMENTIn many ways, the accounting systems and controls that operate in health care institutions are the same as those in any other industry. Because of regulation by governmental agencies and consumer group pressures, however audit concerns for hospital client is expanded considerably. Those concerns, fee pressures because of the nonprofit nature of many institutions, and competition among firms all create a need for this audit analysis to streamline audit procedures and improve audit efficiency as much as possible. In developing an audit strategy for a hospital engagement, the auditor had a thorough understanding of the patient mix.The geographic location of the hospital, the range of service it provides, and state regulations influence the age, financial status, and insurance coverage of the patient population. In particular, the audit strategy will vary depending on whether the services are rendered on a charge-paying or cost-reimbursement basis. If most of the hospital’s services will be paid on a cost-reimbursement basis; the propriety of costs incurred is a primary concern of the auditor. The accuracy of departmental revenue classification is also important in the cost apportionment process.The payment is made either directly by the patient or by third parties based on actual charges billed; auditing statistica l data and departmental cost classification is deemphasized since those data do not affect revenue. In planning hospital audit, it is important to have an understanding of the hospital’s current financial position and financial trends. Analyzing financial ratios may lead to a fuller understanding of the hospital’s operations and problems than could be obtained from reviewing raw data. It is also helpful to compare the hospital’s operations and financial position with those of the other institutions.Inherent risk in considerations in the health care industry revolves around the third-party reimbursement structure. A key concern is billing procedures, which are complicated by the very significant involvement of third parties. TYPICAL TRANSACTIONS, INTERNAL CONTROLS, AND AUDIT TESTS PATIENT REVENUE CYCLE The major source of revenues in a hospital is services provided to patients. Revenue was recorded, at hospital’s established rate, on the accrual basis at t he time services are performed. Patient service revenues are recorded separately by source (laboratory revenues) and by patient type (inpatient or outpatient).Additionally, the source of payment of each patient is essential information that was captured by the accounting system. Hospitals generally billed inpatients after completion of a patient’s stay in the hospital. The actual amount received by the hospital may vary depending on contractual arrangements between the hospital and the patient or a third-party payer. Services rendered to private-paying patients are billed at the established rates, except that courtesy allowances may be granted to doctors, employees, or members of religious orders and charity allowances may be granted as determined by patient needs and hospital policy.To understand the hospital’s patient revenue cycle, the auditor should become familiar with the various functions and departments that may serve patients and should also understand how tho se functions and departments relate to accounting for patient revenue. SUBSTANTIVE TESTS OF ACCOUNTS RECEIVABLE Hospital receivables have several characteristics not normally found in receivables of commercial organizations. First, full-rate charges to patients for services received may be settled for an amount less than the full rate because of contractual arrangements with third-party payers courtesy, charity, or other policy discounts.In addition, large amounts of receivables are paid by third-parties, and payment may be made by a single payer or combination of payers (e. g. , commercial insurance, Medicare, Medicard, workers’ compensation and the patient. ) Since a patient may have more than one insurer, it is possible for duplicate payments to be made on the patient’s account. This results in credit balances in accounts receivable, which are characteristic of hospitals with aggressive billing procedures.The auditor should review the components of these credit bala nces, and if they are significant, consider reclassifying them. Since the hospital must refund duplicate payments, the auditor should review controls over issuance and use of refund checks to determine that they are for valid credit balances and that they are payable to the proper payee. In most hospitals, accounts receivable are classified according to the patient’s billing status, generally using the following categories: †¢Inpatient:Admitted but not discharged (commonly referred to as â€Å"in-house patients†) Discharged but not billed (accounts awaiting final or â€Å"late† charges, or unbilled as a result of a backlog in billing procedures – which might indicate a control weakness) Discharged and billed †¢Outpatient: Unbilled Billed These categories of inpatients and outpatients may be expanded further to indicate private-paying status or third-party responsibility for payment. The existence and accuracy of accounts receivable are normally tested by reviewing subsequent cash receipts.The validity of admitted-but-not discharged patient receivables can be tested by comparing accounts with the daily census report or by relying on compliance tests of admitting function. Confirming balances with patients may be difficult, and the auditor should consider confirming other items, such as number of days spent in the hospital, types of insurance coverage, or, at least, the policy number and insurance company. This information confirms that the patient was in the hospital. Negative confirmations generally produce adequate results for the â€Å"self-pay† or patient portion of the bill.Typical responses for the third-party portion state that the patient believes the bill will be paid by the insurance company or that the patient is unable to confirm because of insufficient information. NONPATIENT REVENUES Revenues from sources other than patient charges consist of interest on invested funds, unrestricted gifts and grants, tr ansfers from restricted funds, and expenditures of restricted fund assets for the benefit of unrestricted (general) funds. Audit steps for material nonpatient revenues should include, but not limited to: †¢Confirming investment activity with banks or an external trustee. Reviewing date and documents underlying gifts, grants, and bequests, such as board minutes, correspondence, and acknowledgement receipts. †¢Reviewing research or grant documentation. †¢Confirming pledges (or otherwise obtaining satisfaction as to their existence) and evaluating their collectability. BUYING CYCLE Payroll. Hospital employees may be classified as professional and nonprofessional. Examples of professional staff are registered nurses and licensed vocational nurses. Nonprofessional employees include orderlies, housekeeping and maintenance personnel, and kitchen staff.Control over both professional and nonprofessional time is critical since salary costs constitute a significant portion of ho spital costs. Generally, the same payroll audit procedures used in other organizations of comparable size also apply to hospitals. Compliance testing of total payroll costs should include tests of controls over classification of costs by department, which is important for purposes of reimbursement and also for cost reporting. Misclassification of a reimbursable cost to a no reimbursable cost center could result in failure to receive reimbursement for that cost.The auditor typically reviews the appropriateness of the account distribution and traces amounts to the payroll register or distribution summaries. Those registers or summaries are tested for mathematical accuracy and then agreed to the appropriate general ledger accounts. Other Expenses. Hospital expenses are typically classified by departmental function (such as nursing services and laboratory services). Proper classification of costs by department is important for financial statement purposes as well as cost reporting and r eimbursement.The auditor should test the propriety of the general ledger account distribution by reference to purchasing documentation. Fixed Assets. Controls over the acquisition of property, plant, and equipment by a hospital should be the same for a commercial enterprise. Some hospital departments own and use expensive, highly specialized equipment, such as nuclear magnetic resonance devices. Department heads should, of course, but that involved in capital budgeting and purchasing decisions, but that involvement should not extend to overriding controls that have been instituted for purchases generally.

Janmar Coating INC Essay

Janmar Coating INC is currently facing a problem of where and how to enact corporate marketing efforts among various paint coatings market. Several top executives cannot come to an agreement on if they should expand to non-Dallas Fort Worth (DFW) areas or construct additives to the current budget for advertising, hiring a salaried employee, or cutting prices so that the customers and retailers who are price sensitive will not be discouraged to use the product. According to the case study the U.S. paint coating industry has three segments. The smallest of the three with only 22% of the market is the special coatings segment. This group is particularly used on items that may have extreme temperature fluctuation or environmental factors. The middle segment with 35% market share is the Original Equipment manufacturing (OEM). OEM is used on objects such as cars, trucks, building products and more. The largest segment with 43% market share is the architectural coatings used on homes, buildings, industrial structures and more. Industry sales for paint coatings in 2004 were around 16 million with expected sales to increase in the next year. Analyzing the data reflects that the segment of Architectural Paint coatings and sundries have a strong position in the industry. This 12 billion plus group is expected to grow more with the extreme demand of maintenance and repairs on new and old homes increase. Although its competition such as aluminum and vinyl siding appears to have a grip on the market but APC is still holding steady. In addition, the do it yourself painters are increasing in popularity making the trend successful and providing stability in the market. Knowing the competition is not hurting but this segments growing concerns are the mandatory regulations regarding a reduction  in emissions caused by the production of paint. This has stigmatized the industry causing sales to decrease which resulted in many business closing or merging with bigger firms. Janmar’s mission is to gain more market share across the industry. With sales being steady in the DFW area there should be an emphasis on the non DFW area which may provide an increase in sales which will result in increased revenue. A strength of the company is great customer relationships. Many believe to sell a particular product you must know the product very well and Janmar’s representatives has demonstrated  this according to several internal customer surveys. Team perseverance believes a weakness in this company may be its inability to begin penetrating the market outside the DFW area. Also the indecisiveness of the leadership of the company may prevent them from taking advantage of the upcoming peak season. In the past before the specialty stores or the big retailers like Walmart and home depot were around Janmars competition was minimal. Although they have many professional painters that purchase their product it may be considered a weakness because it limits gaining more share. The alternative course of action in the Janmar case are being able to excel their presence in the DFW do-it-yourself market. A con to this alternative is that many consumers select a store before selecting the brand. With many stores having more than one brand this may leave the consumer a chance to purchase a less priced product. It is very common for consumers to purchase from advertising they have also seen although a very small percentage. A pro would be the increasing of brand awareness. The cost to enact this alternative is around $350,000 in brand advertising over the current budget. Another alternative which counter acts the previous mentioned alternative is to issue a special coupon in the newspaper. A con may be that in the time of the internet print marketing is out of date and seen as less effective. The alternative is to  hire a new sales representative that may be aggressive in the non DFW area may be a better suggested alternative. A pro to this alternative is the direct cost in salary vs $350,000 in addition to the budget which the salary is dramatically lower in price. The final alternative is to continue with the current approach. Team recommends that Janmar Coating Inc. should chose the last alternative with a twist. Keep everything the same with small increments of change. The first change would be adding a new sales rep. We believe this individuals role to recruit new accounts may show a faster result in revenues via new accounts than advertising on the television which carries a higher cost and more time to see sales increase. This representative may have the ability to get more accounts in one year than they have in five years. One of the strengths of Janmar is its ability to satisfy its retailers. It is crucial that Janmar begins to aggressively  attack the non DFW area in order to get there presence and product known. With globalization it is very easy for a company to be left behind.

Essay on The Problem Of Hiv / Aids -- Immune system, HIV, AIDS, Vaccine

Although HIV is no longer the death sentence it was back in the 80’s, it remains a thorn even in our modern societies. For instance, HIV treatment is exponentially expensive, and can only be afforded by people residing in developed countries. In fact most third world nations, are still in the 80’s as far as HIV treatment technology is concerned. In 2011 alone over two and half million people died of AIDS, with the continent of Africa topping the list (Gallo 267). With prices, for HIV medication up the roof and the virus becoming more resistant to medications there is nothing such as a happy ending for 50 million people world wide still leaving with the disease (Gallo 267). The clock is ticking not just for the forty million, but also, for the sci... ... middle of paper ... ...n the end only Kaprowsky knows . To even consider those who we trust with our life may have invented the worst disease that has cause over 26 million fatalies so far is unimaginable(Gallo 266). Hoopers theory is not neccesarily a smoking gun but it does raise questions on the credibility of doctors. Hoopers intentions in writing his book the river wasn’t to point a finger but to raise awareness of how often medical errors occur with the minority being used as the guinea pigs; Nevertheless, for magic and all the millions of people living with AIDS the fight continues, a fight to decrease aids fatalities and find a cure, in this fight only one person has been cured so far, the famous berlin patient but as for the other forty million there is reason to hope,that in this developing technology that one day AIDS will be a dark history, surely nothing lasts forever.

As you complete your first semester at ASU and at the W. P. Carey Essay

As you complete your first semester at ASU and at the W. P. Carey School, take some time to reflect on what youve learned and how far you have come - Essay Example The great diversity had significant impacts on me because my former environment was almost homogeneously populated. I have as a result learned to appreciate people in their diversity and to accommodate their opinions as opposed to my previous orientation. While I initially failed to accommodate people’s diversity in expression leading to conflicts, I have learnt to pay attention to people’s backgrounds, traditions, and to accommodate them. As a result, I have been able to develop and retain trust based friendship that is free from selfish motives. Another significant lesson that I have learnt while in the institutions is the importance of socialization. While I came in as a reserved person who was concerned about personal business only, I have learnt to open up and to be part of a wider society in which people interact with friends to share experiences, opinions, and advice. My initial introversive nature that can partly be associated with my family background as a smal l family with working parents trained by to be ‘self-reliant’ and restrained. I however with the help of counseling changed and gradually opened up to invite people into my life. This has further helped me to learn a lot about other people, their experiences, and traditions, giving me insights to a developing vision and focus on my goals in life. This is because sharing with other people opens up a person’s intellect to a more open opinion about the environment and life as a whole. Similarly, and most importantly, I have learnt of the power of peer influence, its negative impacts, and the possible way of avoiding or getting out of negative peer pressure (Colostate, n.p; Pickthebrain, p. 1). Based on my experience in the institution, I plan to be more open to the environment to learn more from members of the society. I also intend to play a role in other people’s lives by positively influencing peoples based on my past

Interest Rates Essay Example | Topics and Well Written Essays - 2000 words

Interest Rates - Essay Example All the monotheistic religions i.e. Judaism, Christianity and Islam looked interest with contempt; where the Judaism and Christianity compromised with its significance as stimulating force for economic prosperity, Islam still treats it as a ' war against God' and practicing Muslims dislike the lending and receiving of interest . In our early history the Greeks were considered as highly civilized nation. Lending money at interest was forbidden by the Greeks. Aristotle whose powerful indictment greatly influenced the later nations condemned the taking of interest in very strong words. He compared money to a barren hen which laid no eggs. According to Aristotle, the object of the use of money was to facilitate exchange, and the fuller satisfactions of human wants. According to him this was the most natural purpose of money; money could not be used as the source of accumulation i.e. to increase at interest. So accumulating money at interest was the most unnatural of all ways of making mo ney. A piece of money cannot beget another piece, and hence it was unjust. Plato too condemned interest. Similarly Roman Empire prohibited the charging of interest, and they were first nation to enact laws for the protection of debtors. Gradually prohibitions against usury began to be renewed in Europe. In England the ban was renewed in 1545, during the reign of Henry VIII. It was only during this period the word usury began to be replaced 'interest'. (Homer 1996) The Prerequisites to the Rise of Interest Rate: In the underdeveloped economies the demand for capital is great while the supply is very limited as compared with developed economies. Marginal productivity of capital is very high in developing countries and hence the rate of interest is also high. Some political factors also contribute to high rate of interest in poor countries. As a high risk of bankruptcy is involved the higher rates of interest are claimed by the lending agencies.Where there are possibilities that capital would earn greater reward for the investor, he will be willing to pay higher rate of interest keeping in view the higher degree of capital productivity and better power of payment of interest. In such situation the rate of interest will rise. When a loan is required for a longer period the money lender would prefer to advance loans to debtors at higher rate of interest as the money lender/creditor have to part with their cash assets for a long period which involves greater risks than the short term loans. Increase in trade and business activities creates healthy atmosphere and it also creates demand for capital to greater extent and in such circumstances the expectation of higher rate of interest can not be ignored. The rate of interest will rise due to excessive demand of cash resources. When the economy is under inflationary pressure, it is indicative of the fact that the higher rate of interest prevails in the economic activities of a country. In such situation the interest rates will also rise The Nature and Necessity of Interest Rates: Why should interest be paid at all In the Middle Ages Money

Managment and leadership development Essay Example | Topics and Well Written Essays - 1750 words

Managment and leadership development - Essay Example In order to understand the value of management and leadership development, it is important to go to the roots of why and what makes management and leadership development under focus. Do we have the appropriate environment and systems to develop these Leaders? Why do we need success managers and success leaders? And then what makes success managers and leaders. What sort of influence does early childhood on leader's success? What critical channel must leaders follow on their Journey to success? How long will take them? What are the life experiences that contribute to leadership success? What must success Managers and great Leaders do exceptionally very well to become and remain outstanding? So is it education? Is it luck? Is it who knows how? Is it chance? †¦and so on. Years back when we talked about the old management theories such as the Scientific theory of Fredric Taylor and Henri Fayol – The Science Management concept and even Max Webber in Germany with his concept an d theories after the II World War as all military soldiers sent to work in the Civil Service offices as Supervisors, Managers and Department Heads. Unfortunately, these were wrong people at wrong jobs as they keep on practicing the Military rules by passing instruction like Father to Son and Supervisor and Subordinate. Such theories in my opinion have not developed effective management and success leaders, because there were no proper management development centre's or assessment systems such as 360 degree feedback, or key performance indicators (KPI) as of today. 2. Leadership – overview, definition The Common belief that leaders are born has come to be outdated. Continued studies and researches have come to conclusion that leaders are made rather than born. I and based on my analysis, reading and researching belief that yes leaders are made but also are born with certain characteristics, charisma and qualities of proper personalities example if a person is shy, weak, hesita nt, negative minded†¦etc will be difficult to develop him as a leader. Leadership is badly needed for Organizational success, as someone has to take the hard and tough decisions, take responsibilities during crises, lead the way forward. There is a say that one Lion leads thousands of Rabbits better than one Rabbit leads thousands of Lions. Various definitions have been developed for explaining the context of leadership. One of the most known definitions of this type is that of Kotter (1996). In accordance with the above theorist, the leadership should be described as follows: ‘Leadership defines what the future should look like, aligns people with that vision and inspires them to make it happen, despite the obstacles’ (Kotter 1996, p.25 in Wallin 2010, p.26). 3. Theories on leadership Leadership is influencing people to get things done to standard and quality above their norm and doing it willingly. Generally, leadership could be described as follows: lead more, M anage less, empower inspire and energize people and unlock their true potential. Also great leaders make a difference not only to themselves but also to those around them. However great leaders produce great results. In accordance with the theory of Mintzberg, the elements of the leadership can be made clear if the specific framework is explained using a metaphor; in the context of this metaphor, as Mintzberg notes, the leadership should be regarded as an art or craftsmanship (Koivunen et al. 2009, p.169).

Managerial Decision Making Research Paper Example | Topics and Well Written Essays - 750 words

Managerial Decision Making - Research Paper Example Managerial Decision Making Decision making is the procedure of identifying opportunities, problems, and solutions to these problems or opportunities. Making decisions involves effort, before and after the actual choice. Decision making occurs at all levels of a business. Frequently, the board of directors makes strategic decisions regarding investment and the course of future growth of a company, among others. Managers can make the tactical decisions regarding how their own department can contribute most effectively to the overall company objectives. Ordinary employees are also expected to make decisions regarding conduct of their own responsibilities, responses to customers and enhancements to business practice. There are two types of decision making; programmed and non-programmed decision making (Richard & Dorothy, 2010). Programmed Decision Making According to Andrew (2011), programmed decisions are made for routine, recurring for well-structured situations using predetermined dec ision rules. These rules normally apply prior experience or practical knowledge about what works in a certain situation. Programmed decisions are resolutions that have been made numerous times in the past; managers have developed guidelines or rules to be applied when certain situations are anticipated to occur. According to Richard & Dorothy (2010), programmed decisions are made to ensure smooth running of the organizational activities. For example, McDonald’s Corporation inventory manager will decide to order certain goods when the company is running out of stock. Few programmed decisions are structured to eliminate individual judgment. In programmed decision making, there are no errors in the decisions since it is routine, and managers normally have the information needed; to create guidelines and rules to be followed by others. Lower level managers are essentially confronted by repetitive and familiar problems; therefore, they typically rely on programmed decisions, such as standard operating procedures. In most cases, lower level managers deal with well-structured problems. If lower level managers come across ill structured problems, they pass on these problems to senior managers in the organizational hierarchy. Similarly, senior managers pass down well structured problems to their subordinates so that they handle more problematic issues. In programmed decision making there is little threat and ambiguity involved, the decision maker is certain on the consequences of his or her actions, pertaining to a certain issue (Andrew, 2011). Non-programmed Decision Making Non-programmed decisio