Downsizing in the public sector: Metro-Toronto's hospitals

Area of Science:

• Health Services Management
• Public Administration
• Organizational Studies

Background:

• Public sector organizations, particularly hospitals, often undergo downsizing to improve efficiency.
• Assessing the multifaceted impacts of downsizing requires examining both internal organizational changes and external inter-organizational dynamics.

Purpose of the Study:

• To predict the outcomes of public sector downsizing initiatives.
• To measure the effects of downsizing at both the organizational and inter-organizational levels within the healthcare sector.

Main Methods:

• A case study methodology was employed due to the exploratory nature of the research objectives.
• Organizational-level data were gathered through interviews with senior executives in two Metro-Toronto hospitals.
• Inter-organizational data were collected from government documents and media reports.

Main Results:

• Downsizing practices within the institutions generally aligned with successful outcomes.
• Procedures at the inter-organizational level were associated with unsuccessful outcomes, counteracting internal initiatives.
• The study observed an overall alignment with unsuccessful procedures, leading to negative systemic effects.

Conclusions:

• The effectiveness of public sector downsizing is contingent on the alignment between institutional practices and inter-organizational procedures.
• Downsizing in the studied hospital system, influenced by external factors, resulted in increased costs and decreased effectiveness.
• Findings suggest that public sector downsizing outcomes may differ significantly from private sector experiences, necessitating tailored strategies.