1. MODERN
MANAGEMENT
TECHNIQUES 1
Presenter : Dr. Vishal
Moderator: Dr. G K Ingle

2. PLAN OF PRESENTATION
• Definitions and concepts of management
• Relevance to health
• Traditional vs modern management tech.
• Classification
• Description of each technique
• Challenges in management
• References

3. • What is Management? “Management is
getting the right things done
–
–
–
–
In right way,
In right time,
By right persons
With right amount of resources and effective use of
resources.”
• It is the efficient use of resources and to get
people to work harmoniously together in order
to achieve objective. ( WHO)
EFFICIENCY AND EFFECTIVENESS

4. Term Modern: It is a basic principle of good management to
choose methods to suits whatever resources available and to use
them in pursuit of well-chosen objectives.
“Health System Management : is defined as purposeful & efficient
use of health system resources and to get members of the health
team coordinated to work harmoniously in order to achieve the
desired common Goals and Objectives.”

5. Importance of management in health
 Human Resource management
 Time management
 Material management
 Financial management

6. Relevance of modern management
technique in health
 Overlapping, conflicting and competing organizations
within Health system.
 Widely scattered funding mechanism with little control
over costs
 Decisions on the mixture of facilities and services
without reference to population need and with no
information about those who do not use the services.

7.  Emerged in the last few decades, since world war II.
 These make increasing use of mathematical and
statistical concepts and methods.
 These are the quantitative & semi-quantitative
methods which are fruitfully employed in management
of business, defense, industry and health.
 It has been proved that these techniques useful in
increasing the efficiency by cost reduction as well as
ensuring better health care

8. Traditional vs Modern management tech.
Traditional : based on behavioural sciences eg.
Personnel selection, training & retraining, motivational
methods, leadership development, supervision etc.
Modern : based on sociology, psychology, social
psychology, educational technology, economics and
statistics

9. Modern management technique
Statistical techniques
• Time trends & forecasting
• Decision theory and tree
Activity analysis
• Time motion studies
• Work sampling and activity
analysis
• Queuing theory
• Gantt chart & work
schedule
Mathematical
techniques
•
•
•
•
•
•
•
Simulation study/models
Systems analysis
Linear programming
Inventory control
Network analysis
PERT & PEP
CPM

10. Modern management techniques
Financial techniques
•
•
•
•
•
•
•
•
•
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Monitoring expenditure
Cost accounting & analysis
DALY
Cost benefit analysis
Cost effectiveness analysis
Performance budget
PPBS
Zero base budgeting
Input output analysis
Outcome budget
Miscellaneous
• Management by objective
& appraisal by results
• Management by exception
• Situational analysis
• Current state assessment
• SWOT analysis
• Log frame analysis

11. STATISTICAL TECHNIQUES
1. Time–trends and forecasting : based on information
on occurrence of certain events, certain patterns can be
recognized eg. 1. Secular trend – increasing
incidence of CHD, accidents and cancers etc. 2.
seasonal variations of gastro-enteritis.
•
Based on past experience, predictions can be made
about the expected occurrence, by using mathematical
methods eg. Demographers made projections about
population, epidemiologists anticipation of epidemic

12. 2. Decision theory and decision tree :
• A methods for determining the optimal course of action
when a number of alternatives are available and their
consequences cannot be forecast with certainty
• Uses probabilistic analysis to help in the selection of
remedial actions.

13. Types of environment:
1. Decision making under certainty
Decision
theory
Applies
– Future “states of nature” are known
– Will choose the alternative that has the
highest payoff (or the smallest loss)
2. Decision making under uncertainty
– Future “states of nature” are uncertain
– Depends on the degree of decision maker’s
optimism
3. Decision making under risk

14. Decision Tree
• It is a decision support tool that uses a tree-like graph of
decisions and their possible consequences ( including
chance event outcomes, resource costs, and utility)
• Commonly used in operations research, specifically
in decision analysis, to help identify a strategy most
likely to reach a goal.
• It enables people to decompose a large complex
decision problem into several smaller problems

15. Constructing a decision tree
• Symptomatic patient:
»operate (risky)
»medical management
• If disease present at surgery, must decide whether
try for cure or palliate
• Want to evaluate surgery vs. medical
management

16. Three types of nodes:
1. Decision node 2. Chance node 3. End node • only splitting paths no converging path

22. • Decision theory (DT) represents a generalized
approach to decision making
• Decision making is an integral part of
management:
– The decision maker selects one strategy (course of
action) over others depending on some criteria, like
utility, sales, cost or rate of return.
– Is used whenever an organization or an individual
faces a problem of decision making or dissatisfied
with the existing decisions or when alternative
selection is specified

23. Solution steps to any decision
problem
1. Identify the problem
2. Specify objectives and the decision
criteria for choosing a solution
3. Develop alternatives
4. Analyze and compare alternatives
5. Select the best alternative
6. Implement the chosen alternative
7. Verify that desired results are achieved

24. Advantages of decision trees
• Are simple to understand and interpret
• Useful to analyze the possible outcomes of
complex decisions.
• Possible scenarios can be added
• Most rational decision is taken in terms of
resource and effectiveness.
• Worst, best and expected values can be
determined for different scenarios
• For example : to study alternative health strategies
in disease screening, immunization etc.

25. ACTIVITY ANALYSIS TECHNIQUE
1. Time motion studies : it consists of observing and timing
by using stopwatches the physical work & movements carried
out by worker.
•
1) a complex task is broken into small & simple steps,
•
2) the sequence of movements taken by the employee in
performing those steps is carefully observed and analyzed to
detect & eliminate redundant and wasteful motion,
•
3) precise time taken for each correct movement is measured.

26.  ADVANTAGES:
• Reduction of physical effort
• Time saving and
• Increase productivity
• Eg. From each ward lab samples used to sent with a servant to
central path lab. Servants take excessive time to return.
• Modification :- one servant from the central lab goes to
different ward with trolley at predetermined time. Reports
delivered in same way

27. 2. WORK SAMPLING AND ACTIVITY ANALYSIS
 Work sampling : is a commonly used industrial engineering
technique designed to measure how resources such as
people, machines, facilities, or equipments are utilized.
• The method consist of making observation at random for
appropriate length of time and recording the utilization of
equipment or activities of a people during these periods.
•
sample
statistical method
total activity
• Work sampling is used to estimate the proportion of workers'
time that is devoted to different elements of work activity.
• The idle time of machines and equipment can be calculated

28. • Observed activities are grouped into either of two main
classifications: working or nonworking.
• The working classification can be subdivided into
desirable or undesirable.
Advantages:
• work sampling is a low cost alternative to continuous
monitoring, just as sampling in the audit context is a
low cost alternative to 100 percent evaluation of an
account.
• Better and proper utilization of time

29. • Example: Observations among nurses :
21 % of time spent on bed side
nursing.33 % of time spent on clerical
activities in the ward
• PHC staff: 15 % of time on direct
services, 34 % on administration, 21 %
on travel, 30 % on non productive
activities.

30. 3. Queuing Theory
Queuing theory is basically a mathematical approach applied to the
analysis of waiting lines.
eg. emergency room, OPD setting, pharmacy, for emergency and
disaster management preparedness etc.
Goal of queuing analysis: to minimize costs
 Costs of waiting lines or queue:
1. Cost associated with patients having to wait for service
 Loss of business to HCO
 Costs incurred by society
 Decreased patient satisfaction and quality of care

31. 2. Cost of providing the services (capacity cost)
 Salaries paid to employees.
 Salaries paid to employees or servers while they wait for
service from other server, for eg. waiting for the pathology
report, radiology report, labs, etc.
 Fixed costs – cost of waiting space, facilities, equipments, and
supplies.
• It is extremely useful in predicting and evaluating performance
• Excessive queuing can quickly erode customer loyalty.
• How to minimize the time spent by customers standing in a
queue
• What is the trade-off between the time customers spend queuing
and the cost of additional capital to reduce queuing times?

32.  Answer is Queuing analysis
• Queuing theory involves the analysis of what is known as a
queuing system, which is composed of a server; a stream of
customers, who demand service; and a queue, or line of
customers waiting to be served

33. Characteristics
• Arrival Process
– The probability density distribution that determines the customer
arrivals in the system.
• Service Process
– The probability density distribution that determines the customer service
times in the system.
• Number of Servers
– Number of servers available to service the customers.
• Number of Channels
– Single channel
– Multi channels
• Number of Phases/Stages
– Single Queue
– Series or Tandem
– Cyclic -Network
• Queue Discipline
-Selection for Service
– First com first served (FCFS or FIFO)
– Last in First out (LIFO)
-Random
-Priority

34. Assessing the parameters
• Customer arrival rate
– The number of customers entering the system per
unit time
• Customer service rate
– The number of customers the system serves per unit
time
• Average number of customers in the system
– The number of customers either waiting in queue or
receiving service
• Average delay per customer
– The time a customer spends waiting plus the service
time

35. Little’s Law
• Example: the average number of customers (N) can be
determined from the following equation:
• N= T
• lambda - is the average customer arrival rate and
• T - is the average service time for a customer.
• Let N = the number of people seated (say 200)
• Let T = mean amount of time a person stays seated (say 90 min)
• Conclusion
– Avg . Customer arrival rate = 200/90 = 2.22 persons per minute
• Wait time
– If 100 people are waiting, you could estimate that you will need to wait
100/2.22 = 45 min

36. 4. Gantt
Chart
A Gantt chart is a graphical representation of the
duration of tasks against the progression of time.
It is a type of bar chart that illustrates a project
schedule. allow to assess how long a project
should take.
Gantt charts monitor progress.
It can immediately see what should have been
achieved at a point in time.
Henry Laurence
Gantt (1861-1919)

37. How to make Gantt chart
• Can be created with simple tools like Excel, but
specialised tools like Microsoft Project make it easier
• Step 1 – list the tasks in the project
• Step 2 – add task durations
• Step 3 – add dependencies (which tasks cannot start
before another task finishes)
• Step 4 – lay out all of the bars on the graph

38. Tasks
Choose research area
Preliminary research
Decide research topic
Decide methodology
Submit/present proposal
Finalise methodology
Conduct research
Analyse data
Write up
Fig. Simple research project Gantt chart
Wk24
Wk23
Wk22
Wk21
Wk20
Wk19
Wk18
Wk17
Wk16
Wk15
Wk14
Wk13
Wk12
Wk11
Wk10
Wk9
Wk8
Wk7
Duration
Wk6
Submit assignment

39. • Characteristics:
– The bar in each row identifies the corresponding task
– The horizontal position of the bar identifies start and end times
of the task
– Bar length represents the duration of the task
– Task durations can be compared easily
– Good for allocating resources and re-scheduling
– Precedence relationships can be represented using arrows
– Critical activities are usually highlighted
– Slack times are represented using bars with doted lines
– The bar of each activity begins at the activity earliest start time
(ES)
– The bar of each activity ends at the activity latest finish time
(LF).

40.  Advantages
Simple
 Good visual communication to others
 Task durations can be compared easily
 Good for scheduling resources

 Disadvantages
Dependencies are more difficult to visualise
 Minor changes in data can cause major changes in the
chart


41. Mathematical techniques
1. Simulation Studies/Model
• Use of mathematical models to calculate
results by means of simulation of a real
situation.
• Impact of inputs and changes on the output
can also be estimated
• Objective : to forecast the probable effects of
measures in terms of relative cost and benefit.

42. 2. Systems Analysis
• System : An
arrangement and set of
relationships among
multiple parts functioning
as a whole.
• Systems Analysis: Study
of inter relationships
operating in the various
components within a
system and also between
a system and other
systems.
• Systems:
Hospital, Community
health
centre, dispensary,

43. Steps
• Set of objectives to be achieved is
defined and alternatives to achieve
these is formulated.
• Alternatives are evaluated in terms of
cost-effectiveness.
• Mathematical models may be used.

44. 3. Linear Programming
•Mathematical tool
Components of a system and its constraints are depicted
In a linear equation and the desirable combination of
activities
With regard to certain given set of objectives and constraints
is arrived at.
linear programming (LP) problems are optimization
problems
in which the objective function and the constraints are all
linear.
• It is a useful tool for deciding the course of action for a
problem in which there are competing alternatives uses
for limited resources.

45. 4. Inventory Control
• Method of
maintaining of stock
at a level at which
purchasing and
storing costs are the
lowest possible
without interference
with supply

46. Why needed?
If drugs purchased in large quantity
 Adv: the risk of out of stock avoided
 Disadv:
 locking up money in maintaining huge stock
 large storage space
 require staff to store and handle various items
 chances of expiry, pilferage
Objective : maintaining optimum stock
 Techniques
ABC analysis
VED analysis
FSN analysis
SDE analysis

47. Analysis of store items based on their cost

48. ABC
A
N
A
L
Y
S
I
S
WORK
SHEET
1
90000
90000
2
50000
140000
20000
160000
4
7500
167500
5
7500
175000
5000
180000
4500
184500
8
4000
188500
9
2750
191250
10
1750
193000
11
1500
194500
12
70 %
CUMMULATIVE
COST [Rs.]
7
20 %
ANNUAL COST
[Rs.]
6
10 %
ITEM
3
ITEM %
1500
196000
13
500
196500
14
500
197000
15
500
197500
16
500
198000
17
500
198500
18
500
199000
19
500
199500
20
500
200000
COST %
70 %
20 %
10 %

49. • A items : small in no. , but consume large
amount of resources
• Must have
•
•
•
•
•
Tight control
Rigid estimate of requirement
Strict & closer watch
Low safety stock
Managed by top management
• C items : larger in no. but consume lesser
amount of resources
• Must have
• Ordinary control measures
• Purchase based on usage estimates
• High safety stocks

50. VED Analysis :
based on criticality in pt. care
• VED Analysis V=10% E=39%
D=51%
• V =Vital life saving drugs. Absence of
which cannot be tolerated.
• E= Essential items. Absence can be
tolerated for a short time period.
• D=Desirable. Non availability can be
tolerated for a longer period.

51. Combination of ABC &VED Analysis
V
E
D
A
AV
AE
AD
CAT I
15%
B
BV
BE
BD
CAT II
40%
C
CV
CE
CD
CAT III
45%
Cat 1 : needs close monitoring & control
Cat 2 : moderate control
Cat 3 : no need for control

52. SDE ANALYIS
Based on availability
Scarce
Managed by top level management
Maintain big safety stocks
Difficult
Maintain sufficient safety stocks
Easily available
Minimum safety stocks
FSN ANALYSIS
Based on utilization.
Fast moving.
Slow moving.
Non-moving.
Non-moving items must be periodically
reviewed to prevent expiry
& obsolescence

53. 5. Network analysis
A technique whereby objectives are identified,
activities and tasks involved in attaining the objectives
are determined and their interrelationships are
presented graphically in the form of network and used
as a basis of determining sequence of activities and
allocation of resources.
Planning and monitoring the progress of large no. of
different interrelated activities necessary for the
completion of project with minimum time & cost.

54. • Advantages
 Simple to understand
 Well defined in practical terms
 Applies to any project where activities can be
described sequentially.
 Inexpensive
 Does not need very highly qualified
specialists.

55. • Two types :
Programme Evaluation Review
Technique (PERT)
Critical Path Method (CPM)

56. •
PERT
Programme Evaluation Review Technique : Shows diagrammatically
the logical sequence in which different events between the start
and end of the project need to take place
4 mnths
Staff
recruited
2 months
Staff trained
1 months
Plan service
2 months
Equipment
ordered
Equipment
installed
10 months
1 months
Start providing
service

57. • PERT involves planning, monitoring and controlling of
projects where time taken for each activity in the project is
not known
• PERT is classically used in long-term projects like
construction of hospitals, ships, roadways and buildings, in
planning & launching of new health programs, products &
services, in publication of books etc where exact time for
each phase is not known with certainty.
• PERT uses probabilistic and linear programming methods
to assist a manager in planning schedules &
costs, determining time & cost status, forecasting skill
requirements,

58. • Under PERT, three time-estimates are made,
1. Most Likely Time is the time taken most frequently in
completing a particular activity.
2. Optimistic Time is time in which an activity can be
completed, if all goes as per the pre-determined plan.
3. Pessimistic Time is the time taken to complete an
activity under most adverse conditions. This is thus
the longest possible time taken to complete a project.
• Calculation of activity time
Activity
Time= Optimistic time + 4 X( likely expected time)+Pessimistic
time
6
50 % chance (Probability of correct estimate of time)

59. • Advantages of PERT
• Disadvantage of
PERT
 Aids in planning,
scheduling and monitoring  Overemphasis on
the project
time & almost no
attention to cost
 Provision for better
communication
 Identifies potential
problems
 Furnishes continuous timely
progress report
 Enables evaluation and
feedback

60. Critical Path Method (CPM)
• Longest path in the method.
• The process cannot end before the critical pathway
ends.
• Reduction in time of a project is only possible
if there is a reduction in the time taken the
critical path.
• Reduction in time may be brought about by
increase in the resources keeping cost factor
in mind.

61. Determining the Critical Path for
Project X

62. EMERGING CHALLENGES FOR
MANAGEMENT
• Globalilization: Managers need to think globally and act locally.
• Technology: Management will need to manage changing
technology effectively.
• Quality: Quality assurance is getting important.
• Social responsibility: Management will pursue long term goals that
are good for society.
• Empowerment: To empower worker is a challenge to management.
• Human resource management: Management needs to deal with
diversified work force, requires visionary leadership on the part of
management
• Organization design: Organization will be lean flat and less
hierarchical

63. References
• Modern management methods and organization
of health services. WHO.pdf
• Park’s Textbook of Preventive and social
Medicine. 22nd ed.
• P. V. Sathe’s textbook of Epidemiology and
management for health care for all. 3rd edition
• Reetu Mehandiratta. Applications of queuing
theory in health care. IJCBR. May 2011. VOL2
N2.P9