A Daily Dilemma: Balancing Efficiency and Redundancy

By | 2019-08-27T15:01:56+00:00 August 27th, 2019|

For nurse staffing managers, balancing the needs of the nurses with the financial constraints facing hospitals can be a delicate, daily process of politics and compromise. And for good reason: as Peter Drucker once remarked, “The hospital is altogether the most complex human organization ever devised.” It seems only natural that some of that complexity trickles down into issues surrounding a hospital’s workforce.

However, the staffing questions faced by administrators reflect the same fundamental tension faced in any industry, namely, the trade-off between efficiency and redundancy. One can define efficiency in a number of ways; the standard economic definition of efficiency is the optimal allocation of resources within a given system. With respect to staffing, we might consider a hospital to be efficient if it staffs to demand or its nurses practice at the top of their licenses, among other criteria.

Redundancy, on the other hand, stems more from engineering disciplines than from economics. Redundancies are duplications of key system components in order to improve the reliability of a system or protect a system from failure. From this perspective, we might consider a nursing float pool redundant; it provides hospitals with a fail-safe or a buffer for times when there are too many patients and not enough nurses.

The pursuit of efficiency confers clear financial benefits. A hospital that staffs to demand may reduce its labor costs. With regards to its supply chain, it may implement a just-in-time system to minimize inventory costs. Steps like these can produce an immediate impact on a hospital’s bottom line.

A hospital can also derive benefits from building redundancies, even if these benefits are less tangible. For example, a hospital that staffs to maximum occupancy will almost always be prepared for surges in patient census. Redundancies could improve staff morale as well if nurses feel their workloads are reasonable and are therefore less stressed.

But the costs of pursuing either efficiency or redundancy in isolation should make it clear that neither goal is desirable in and of itself. The efficiency represented by superficial cost savings could, in fact, mask hidden inefficiencies should future costs be incurred due to a lack of redundancies. A hospital may appear efficient, but not actually have the resources to deal with a sudden influx of patients.

Likewise, a hospital pursuing every possible redundancy would suffer from the basic economic principle of diminishing marginal returns. We could, for instance, hire as many nurses as possible simply to protect ourselves against the slim possibility of needing them in an emergency. But if that emergency never materializes, all we’ve done is balloon our labor costs with little or nothing to show for it.

Balancing the intractable tension between efficiency and redundancy, therefore, is one of the most challenging problems staffing managers face. Instead of looking for a single answer, however, we should turn to analytic tools to inform staffing decisions and embrace the need for flexibility in the face of life’s inherent variability. Hospital IQ’s platform provides hospitals with a number of workforce solutions developed specifically for this problem.

  • Short-term staffing analytics – With its census forecasting and workforce modules, Hospital IQ provides hospitals with data-driven predictions that can help administrators manage near future staffing needs and greatly reduce last-minute adjustments.
  • Long-term hospital analytics – Hospital IQ’s platform allows clients to simulate changes in future patient volume so they can understand and plan for any capacity or resource constraints.
  • Frictionless communication – Communication about staff schedules and shift changes happens in person, on paper, over the phone, and over e-mail. Hospital IQ streamlines the back-and-forth by integrating staff notes inside our workforce planning tools.

Hospitals might be complex, but balancing the push for efficiency with the need for redundancy doesn’t have to be. With a well-stocked toolbox of analytics, hospital administrators can make data-driven staffing decisions with confidence.

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