The contribution of organization theory

The contribution of organization theory to nursing
health services research
Stephen S. Mick, PhD, CHE
Barbara A. Mark, PhD, RN, FAAN
We review nursing and health services research on
health care organizations over the period 1950
through 2004 to reveal the contribution of nursing to
this field. Notwithstanding this rich tradition and the
unique perspective of nursing researchers grounded
in patient care production processes, the following
gaps in nursing research remain: (1) the lack of theoretical
frameworks about organizational factors relating
to internal work processes; (2) the need for sophisticated
methodologies to guide empirical investigations; (3) the
difficulty in understanding how organizations adapt
models for patient care delivery in response to market
forces; (4) the paucity of attention to the impact of new
technologies on the organization of patient care work
processes. Given nurses’ deep understanding of the inner
workings of health care facilities, we hope to see an
increasing number of research programs that tackle
these deficiencies.
There is little question about the rapid expansion in
research aimed at better understanding the organization
and delivery of nursing services as a mechanism
both to improve quality and patient safety, as
well as to enhance working conditions for nurses. This
research requires not only deep theoretical knowledge
about health care organizations and their functioning,
but also knowledge of critical methodologic issues that
influence how the research is conducted. This knowledge
has traditionally resided within the discipline of
health services research (HSR). Yet, with more and
more nurse scientists involved in such endeavors, there
is a need to better understand the intersection of nursing
and health services research, and particularly the organizations
within which nurses work. This paper provides
a brief historical overview of organizational
research within the history of HSR since the beginning
of the 1950s, then discusses exemplars of nursing
research that have incorporated various organization
theories in their studies. Finally, some comments are
offered regarding the need for further methodologic
development to enhance the quality of nursing health
services research.
HISTORICAL OVERVIEW
The Internal Focus
Through much of the 1950s and into the early 1960s,
social scientists doing HSR studied the hospital as a
social system, which yielded richly detailed descriptions
and analyses of the inner workings of inpatient
facilities, including the role of nursing.1 Bureaucratic
theory provided much of the conceptual basis for these
studies, emphasizing the importance of hierarchy, authority,
work design, power and control, communication,
formalization, and standardization.2 In general, the
emphasis of organizational studies in HSR was on the
internal operations and management of facilities,3 and
nursing was a frequent subject of this focus.
A growing concern that researchers expressed was
whether internal organizational forms might show some
variety from a “standard” bureaucratic model and
whether any of this variation might also be related to
performance. This exploration, pursued by such researchers
as Thompson4 and Woodward,5 among others,
gave birth to the contingency perspective. Contingency
theory is the focus on what the desirable “fit”
might be between the technological tasks an organization
performs and the organization’s structures and
designs. Well into the 1980s, works like that of Mintzberg
formulated conceptually distinct organizational
forms that were hypothesized to work better, or worse,
given the technological tasks the organization faced.6
As promising as the internal focus was—especially for
nursing research—it finally ceded the limelight to the
concurrent, but ever-growing, interest in organizational
environments and their impact on the organization.7
The External Focus
The “external focus” had its beginnings in classical
sociological studies of hospitals that depicted them as
organizations that both reflected and challenged the
Stephen S. Mick, PhD, CHE, is Arthur Graham Glasgow Professor and
Chair, Department of Health Administration, Virginia Commonwealth
University, Richmond, VA.
Barbara A. Mark, PhD, RN, FAAN, is Sarah Frances Russell Distinguished
Professor, School of Nursing, The University of North Carolina
at Chapel Hill, Chapel Hill, NC.
Reprint requests: Stephen S. Mick, PhD, CHE, Department of Health
Administration, Virginia Commonwealth University, Richmond, VA
23298-0203.
E-mail: micks@mail2.vcu.edu
Nurs Outlook 2005;53:317-323.
0029-6554/05/$–see front matter
Copyright © 2005 Mosby, Inc. All rights reserved.
doi:10.1016/j.outlook.2005.07.002
N O V E M B E R / D E C E M B E R N U R S I N G O U T L O O K 317
social order of the larger society, particularly in the
realm of what sociologists call stratification, the study
of social differences and social classes and their effect
on the provision of patient care.8 The link between the
larger society’s social structure and the embedded-ness
of hospitals within this matrix produced a natural
seedbed for a new generation of organization theorists
who, in the late 1960s, “discovered” the field of health
care organizations and their environments.9,10 Major
theoretical statements about the complex relationship
between organizations and their environments were
quickly formulated, particularly by scholars such as
Lawrence and Lorsch11 and Pfeffer and Salancik.12
In HSR, the emphasis on organizations and their
environments led to a burst of conceptualization, theory
building, and empirical study that almost completely
submerged interest and research in internal organizational
issues. We profited enormously from this new
research, developing better typologies of organizational
environments, defining salient characteristics of health
care organizations, and applying increasingly available
databases collected on national samples and entire
populations of health care organizations. Very little
primary data collection or in-depth qualitative analysis
was required for this new energy, further contributing to
a languishing of study of internal organizational issues
in health care organizations.
Two primary forces contributed to this development.
First, the rise of health economics, which occurred
about the same time, reinforced this trend in HSR by
emphasizing the role of markets in hospital behavior.
Second, the rise of health maintenance organizations
(HMOs), particularly as a function of the HMO Act of
1973, helped focus attention on how historically separate
organizations— doctors’ offices and hospitals—
could be merged through the conceptual lens of socalled
“interorganizational” arrangements.
By the 1980s, this stream of research about organizations
in health care was dominated by the organization/
environment focus in the social sciences and by the
organization/market focus in economics, at least insofar
as anyone was concerned with health care organizations
qua organizations. The dominant policy issue was how
market forces and interorganizational arrangements
might be studied and structured to produce cost savings
to the entire health care system. Overall, however, for
HSR this was a “dry” period in regard to research
focusing on the interior of organizations. Attention was
riveted on the interplay of organizations and their
environments.
A Return to the Internal Focus
A major exception came from nursing in a significant
effort to understand internal health care organization
processes via the development of the Diagnosis Related
Group (DRG) project at Yale. Although its eventual use
in Medicare’s Prospective Payment System (PPS) has
obscured the original analytic effort to understand the
clinical underpinnings of each separate DRG, which are
composed largely of nursing care, it is no less true that
the DRG system was an effort to rationalize, standardize,
and codify the inputs to patient care at the bedside.
13 The key author of this research was John
Devereaux Thompson, a nurse trained at Bellevue
Hospital in New York. He always credited an earlier
nurse, Florence Nightingale, for the inspiration of
grouping together patients with similar diagnoses so
that a more standardized and rationalized application of
care processes could be the basis for improved quality
and outcomes.14
The enactment in 1983 of the prospective payment
system resulted, over the next 5 to 10 years, in changing
patterns of care in acute care organizations that ultimately
had an impact on HSR. The early 1990s witnessed
dramatic changes in the operating environment
for acute care hospitals as a result of the increasing
dominance of managed care. Hospitals responded by
implementing a range of strategies aimed at improving
the efficiency of their internal operations. First, PPS
forced a shift of services from the inpatient side to the
ambulatory side, in both the HMO and fee-for-service
sectors. Second, with nursing personnel comprising
approximately 30% to 40% of overall hospital FTE
personnel and approximately 30% of the hospital budget,
hospitals also responded with re-engineering and
redesign strategies that frequently involved changes in
nursing staff.15,16 Together, the impact of these changes
resulted in increased severity of illness for hospitalized
patients who required more intensive nursing care.17 As
this phenomenon wore on throughout the 1990s, abetted
by the growth of managed care—particularly for-profit
plans—and the impact of the Balanced Budget Act of
1997, it translated into new areas of focus for HSR: a
refocusing on quality of care as concerns were raised
about the effect reimbursement changes were having on
hospital care. It is as if there was a “rediscovery” of the
central importance of internal elements and processes
of organizational life as key to understanding when an
organization works well and when it does not, including
when it delivers good quality of care. Furthermore, the
recent patient safety phenomenon has added to our
armamentarium of analytical tools and insights from
work design, human factors, and organizational behavior
and motivation research areas.
The issue of quality caught contemporary organizationally-
oriented HSR researchers unprepared because
they had few conceptual tools to address the heart of
quality concerns: the internal work processes and arrangements
inside health care organizations. There is,
therefore, surprisingly little theoretically-based organizational
HSR work on quality that addresses the internal
organizational issues that contribute to variations in
quality. It is our view that nursing research has most
Nursing health services research Mick and Mark
318 V O L U M E 5 3 ● N U M B E R 6 N U R S I N G O U T L O O K
successfully been filling this gap in the 1990s and into
the 2000s.
The work of several nurse researchers has clearly
demonstrated how organization theory can advance a
better understanding of internal organizational issues
and how they contribute to quality of care. For example,
using contingency theory, Alexander and Randolph
found that nursing subunit performance was better
predicted by the “fit” between technology (ie, work)
and structure, than by either technology or structure
alone.18 Mark and Hagenmueller also used contingency
theory and found significant technological and environmental
differences among intensive care units, suggesting
the importance of different management structures
and processes for these units.19 Mitchell and her colleagues
also found contingency theory to be useful in
their study of critical care outcomes.20
As for studies that more directly assess the organizational
features surrounding patient care, nursing researchers
have made remarkable inroads. More recently,
the work of Mark, Salyer, and Wan, which
found that professional nursing practice (eg, decentralization
of clinical decision making, enhanced autonomy,
collaborative relationships with physicians), although
having strong positive effects on nurse
satisfaction, actually had only limited impact on other
outcomes such as medication errors.21 Aiken’s work on
“magnet status” also suggests important organizational
features to support patient care. For example, Vahey,
Aiken, and associates confirmed the hypothesis that
nurse-reported adequate staffing levels, positive administrative
support, and good relations with physicians led
to higher patient satisfaction and lower nurse burnout.22
Similar results were found in English-speaking crossnational
studies.23 In nursing homes, organizational
characteristics like for-profit status, large size, and high
occupancy rates are correlated with low staffing levels
and more quality problems.24,25 Poor hospital climates,
or work environments, have been found to be correlated
with poor quality and lower patient safety levels.26,27
Restructuring and re-engineering of hospital services
have also come under scrutiny.28 These are examples of
the kind of research by nurses that attempt to better
understand the internal characteristics of health care
organizations and how they contribute to quality of
patient care.
Another aspect of this work builds on time-motion
and “human engineering” studies that have been part of
the nursing research realm for some time. Potter and
colleagues’ application of graphic techniques to study
nursing work is an exciting example of micro-level
research that seeks to explain the complexity of nursing
work,29 work that involves much feedback and interaction
and that is not easily captured through traditional
industrial engineering and industrial quality control
theorizing. By examining so-called “cognitive pathways,”
the complex decision-making nature of nursing
is revealed. Without acknowledging it explicitly, these
nursing researchers are joining with a few other health
care organizational analysts in the application of network
theory to health care work.30,31 The difference is
that the nursing researchers are applying it to the
internal organization, whereas the non-nursing researchers
are using it in the interorganizational realm.
There is obviously much more to be done as both the
theoretical frameworks and the methodologies become
increasingly complex. But the point is that it is the
exploration of work structures and processes at the
nursing unit level that is contributing to the lion’s share
of advancing knowledge about what does and does not
have an impact on patient and organizational outcomes.
IMPROVING METHODOLOGICAL