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ORGANIZING and

STAFFING the PHARMACY

The Nature and Importance of


ORGANIZATION
ORGANIZATION
designated structure of the activities,
processes, and people who make up the
business
all employees need to know specifically what
they are responsible for, who they are to report
to, and who is to report to them

ORGANIZATIONAL PRINCIPLES
AND PRACTICES
DIVISION OF WORK work activities must be
divided among employees in some logical
manner, it should not be specialized that the
employee cannot see the end result of the work
effort
PARITY
of
AUTHORITY
and
RESPONSIBILITY employees should have
authority for assuring the proper completion of
activities they are asked to perform

UNITY OF COMMAND within any business


that has more than one employee, a chain of
command must be established, and every
worker needs to be supervised by one and only
one superior
UNITY OF DIRECTION each employee
should have a clear understanding of, and a
willingness to work for, the goals of the
business
SCALAR CHAIN in any organizational
structure, ultimate authority rests at the top
and flows downward, scopes of and limits to
authority and responsibility must be well
delineated on paper as well as in the minds and
actions of employers and employees

SPAN OF CONTROL principle of span of


control states that there are only so many
employees a manager can effectively
supervise, GENERAL RULE OF THUMB is
that at lower levels managers can oversee
between 8 and 20 employees, while at
upper levels the number is reduced to 4 to 8
KEY FACTORS AFFECTING THE SPAN ARE:
1.
2.
3.
4.

employee training
employee communications
extent of planning
use of assistance

DELEGATION OF AUTHORITY while


responsibility for decisions cannot be passed
on, authority to make them can be vested with
others
FORMAL ORGANIZATIONAL STRUCTURES
LINE ORGANIZATION most common
method for organizing a pharmacy , all
personnel are involved in some facet of the
preparation and sale of the pharmacys Rx and
OTC merchandise
LINE and STAFF ORGANIZATIONS to
compensate for the lack of needed specialists
within a line organization, most common for
larger pharmacies that have experienced a
degree of success and growth

INFORMAL ORGANIZATION develop within


both large and small pharmacies, strengthen
the cohesiveness within the pharmacy and
increase the chances of goal achievement for all
Line

Line & Staff


Organization

Organization

General
Manager

Pharmacy
Manager
Accounting

Manager
Rx Dept.

Manager
OTC Dept.,
Drugs &
Cosmetics

Manager
Durable
Medical
Equipment

Manager
Rx Dept.

Manager
OTC, Drugs
and
cosmetics

Manager
Durable
Medical
Equipment

METHODS OF ORGANIZING THE


PHARMACY
BASIC PROCESS OF ORGANIZING FOLLOWS A SERIES
OF SEVEN STEPS:
1.
2.
3.
4.
5.

6.
7.

define the goals of the pharmacy


identify and define each task to be completed
group related tasks into jobs that can be assigned to
employee
group the jobs into units that are related in some manner
assign a manager to each unit and provide the manager
with the necessary authority and responsibility to
complete the jobs within the unit
arrange these units relative to one another, both
horizontally and vertically
establish a control system for measuring the progress and
achievements of each group.

1. ORGANIZATION BY TIME one of the


easiest methods for organizing a
homogenous group of employees is on
basis of their working hours
2. ORGANIZATION BY NUMBER a
homogenous group of employees that is
too large to be effectively supervised by
one person can be grouped on the basis of
numbers
3. ORGANIZATION BY FUNCTION applies
to situations where there is considerable
diversity in jobs and skills required to
perform them satisfactorily

4. ORGANIZING BY SERVICE management may find


it expedient to organize on the basis of different
services offered, beneficial when dealing with highly
complex products that require great amounts of
technical knowledge
5. ORGANIZATION BY TERRITORY best for chain
organizations that have pharmacies scattered over
broad geographic areas, coordinated efforts between
geographic areas in terms of achieving economies in
purchasing and maintaining consistency build a
corporate identity
6. ORGANIZATION BY A COMBINATION OF
METHODS each pharmacy's organizational
structure will be unique, none of the methods
described may be satisfactory, it may be best to
organize using combination of methods

DIAGRAM
ORGANIZATION BY
NUMBER

ORGANIZATION BY
TIME

OWNER

OWNER

Day
SHIFT

Night
SHIFT

ORGANIZATION BY
FUNCTION

Manager 1

Manager 2

Manager 3

15
employees

15
employees

20
employees

ORGANIZATION BY
SERVICE

OWNER

Rx
Dept.

OWNER

OTC

DURABLE

DEPT.

MEDICAL

RX

EQUIPMENT

DEPT.

SNF

ORGANIZATION BY TERRITORY

OWNER
North

South

West

East

HOME

HEALTH

THE STAFFING PROCESS


STEPS TO CONSIDER:
1. Based on the objectives and level of business activity,
forecast future personnel needs in terms of both
numbers and types of position
2. based on the pharmacy owners personal goals,
determine how many management positions will be
needed in the future and in what service areas
3. specify each type of job identified in steps 1 and 2 in
terms of job descriptions
4. assess the internal aspects of employment in terms of
working conditions and policies
5. determine where the right kind of potential employees
might be found

6. Actively recruit good personnel by promoting


job opportunities
7. Select persons for employment on the basis of
a formalized screening process
8. Actively orient employees to their new
positions and to the pharmacy
9. Train employees to do their jobs, and develop
them for any planned advancements
10. Develop wage and benefit programs that are
fair to the employees and affordable for the
pharmacy
11. Motivate employees and evaluate their
activities

The Role of Owner Licensing &


Goals
registration
- The owner needs to hours
consider what types of compensation
jobs to create and
fringe benefits
what types of people
to employ over both vacations
time off
the short and long
term
training
Personnel Policies grievances
- Critical importance to promotion
staffing process
personnel review
- Most of the
termination
important policies:

Developing a Job Description


JOB DESCRIPTION
statement that identifies what the job consists
of and what qualifications are needed to
perform the tasks satisfactorily
WORK ENVIRONMENT
providing an environment conducive to good
work should be of prime concern to
management, SAFETY must also be considered

EMPLOYEE and RECRUITMENT


and SELECTION
Pharmacy employees job opening represents an
advancement in terms of added responsibility and prestige,
more money, or better working conditions
Referrals employees, relatives, friends and others may know
of people who are qualified and seeking employment could be a
referral
Employees of other companies recruiting employees from
other companies has long been a method of staffing, although it
raises ethical considerations the owner must personally
reconciles, advantages includes: brings a well-qualified person
who knows the business and the competition and it hurts the
competitor
Employment Agencies used to hire nonpharmacists, includes
clerks, office managers, store managers and others

Educational Institutions vocational and


trade schools, and colleges can be a source
of potential employees trained in particular
skills
Labor Unions- management may seek the
aid of labor union in finding qualified
employees
Advertising one way of reaching the full
spectrum of possible applicants
Drop-ins WANTED sign in a
pharmacy's window is a specialized form of
advertising

SELECTING an EMPLOYEE
Application Form the easiest method of
knowing the applicants background and
qualifications
Administering Personal Interviews allows
the employer to ask more questions, clarify
existing ones noted on the application form an
simply gain a better general impression of the
person
Checking the Applicants Past any serious
errors or omissions may indicate that the
person is undesirable

Administering Employment Tests job


proficiency examination in which the applicant
is given an opportunity to demonstrate
occupational skills, series of psychologically
related examinations
Requiring a Physical Examination medical
history may be required for employee medical
insurance or workers compensation, the
employer then is protected from being charged
for injuries occurring prior to coming to work
for the pharmacy
Making a Selection the culmination of an
intensive search and screening process, and
based on the objective data collected

Case Study:

David Downing, EVP of South Bay Hospital,, had just been put in charge of a task force to review the
hospital inpatient pharmacys organizational structure. The hospital had experienced rapid growth in
admissions over the last 2 years, and Clark Gusto, the hospitals administrator, felt that such an
assessment was needed. Despite a 38% increase in revenues for the pharmacy, profits had risen only
9% and the administrative expenses had nearly doubled. Both Mr. Downing and Mr. Gusto believed that
the sudden growth had created a variety of operating inefficiencies. Accordingly, Mr. Downing and the
chief Pharmacist were asked to make recommendations on how to improve the pharmacys
organization as first step in an intensive review of every facet of the pharmacys operations. South Bay
Hospital is relatively a small facility specializing in diseases of the aged. Located in the Western United
States, the hospital initially sought only patients from upper-income households. As an exclusive
hospital, admissions were limited despite its location in a wealthy geographical area. Recognizing that
this orientation would not make the hospital profitable, Mr. Gusto decided to reposition to patients from
lower-income households, many of whom were covered only by Medicare. This change increased in
hospital admissions radically. It is also altered the mix of physicians who affiliated with the hospital.
With the increased admissions, Mr. Downing and Mr. Gusto realized that the demand for pharmacy
services well exceeded its initial capacity. As a result, Rx were not dispensed as rapidly as physicians
and patients desired, and a greater number of dispensing errors occurred. To remedy this situation, the
chief pharmacist was instructed to hire more technicians and 3 new pharmacists, one of whom was to
be the assistant pharmacy manager. In doing this, several new problems arose. First, hiring an assistant
manager from the outside caused considerable resentmen5t, and one long- time pharmacist resigned as
a result. Because this person was quite popular, morale problems quickly became apparent. Second, a
number of newly hired employees remained with the pharmacy for only a short period of time. 2 of
these, one a pharmacist and the other a technician, cited the tense atmosphere as the primary reason
for leaving. 3rd while the assistant manager was given authority to make operating and personnel
decisions, some of the more senior employees routinely questioned many of his decisions. This caused
considerable friction. Both Mr. Downing and Mr. Gusto considered this situation a serious threat to the
hospitals future. They felt that they had taken the appropriate steps necessary at the time, but believed
that some corrective action was in order. As Mr. Downing and Mr. Gusto began to examine the
organization of the pharmacy, they realized that the original structure was no longer being utilized.
Accordingly, they attempted to define the actual organization of South Bay Hospital and its Pharmacy. To
the best of their knowledge, a more realistic depiction of the operations was prepared. Nobody was
quite sure how the current structure had evolved, but everyone agreed that it happened more by chance
than by conscious decision. With this framework in mind, they decided to evaluate the current
organization to see if it was more suitable for the hospital and hospital and pharmacy than the one
established years earlier. They also agreed hat changes could be made in the existing structure as
necessary.

Hosp. Admin.

Hospital
Administrator

Original
Organizational
Structure

EVP
EVP

Pharmacy

Hosp.
Services

Chief RPh
PHARMACY

Hosp.
Services

Chief
Pharmacist

Asst.
Mgr.
Pharmacists

Clerks

Actual
Organizational
Structure

Technicians

ER

ASST. Mgr.

Chief RPh

Senior RPh
Older RPh

Asst.
Manager
New
Pharmacists

Technicians

Clerks

ER

Questions:
1. What problems, if any exist in the original
organizational structure of South Bay
Hospital and its Pharmacy?
2. What changes should be made in the
pharmacys
current
organizational
structure?