Performance Improvement Model Utilizing the Mckinsey 7S Approach for Public Health Centers in Sampang Regency of Indonesia

INTERNATIONAL JOURNAL OF SCIENTIFIC & TECHNOLOGY RESEARCH VOLUME 9, ISSUE 03, MARCH 2020 ISSN 2277-8616 Performance Improvement Model Utilizing The Mckinsey 7S Approach For Public Health Centers In Sampang Regency Of Indonesia

Ahmad Masfi, Tintin Sukartini, Abdul Aziz Alimul Hidayat

AbstractThe McKinsey 7S model is a tool for analyzing organizational and managerial actions by looking at the organization as a whole, so that organizational problems can be diagnosed and strategies can be developed and implemented. This research aimed to analyze the model of improving the performance in public health center through the McKinsey approach in Sampang District, Indonesia. This research used an explorative survey design involving random sampling clusters. The sample consisted of 239 respondents from 20 Public Health Centers. The data was collected using interviews and questionnaires. The questionnaire covered areas of leadership, salary, services, policies, human resource management. The data was analyzed using Partial Least Square (PLS). The results showed that the model to improve institutional performance in the public health centers consisted of five (5) components namely leadership, salary, services, policies, HR management, with each component containing elements of strategy, structure, systems, skills, staff, style, and shared values

Keywords: Performance, Public Health Center, Leadership, Salary, Service, Policy, Human Resource Management ————————————————————

1. INTRODUCTION Soft elements include shared values, skills, staff or personal in the organization, and leadership style [6-9].The purpose Sampang Regency in East Java province is one of the of this study is to analyze the model for improving the regencies on Madura Island that has 21 Public Health performance of public health centers using the McKinsey Centers spread throughout the regency with a ratio of one 7S Framework approach Public Health Center to one sub-district. In 2016, the

Sampang District Health Office conducted a performance evaluation of public health centers under its care and 2. METHODOLOGY discovered that many of the centers had poor This research used an explorative survey design. The performance.Improved organizational performances are research was conducted from February to July, 2018 in driven by various factors like leadership, salary, services, Sampang Regency, Indonesia, involving 239 respondents policies and human resource management. The Human using cluster random sampling from twenty (20) Public Resources (HR) function can play an active, productive role Health Centers. This research used questionnaires, with 24 in achieving organizational goals [1]. Many scientific questions on leadership, 14 questions on salary, 15 approaches to human resource planning and decision questions on service, 18 questions on policy, and 20 models place emphasis on human resources in work and questions on human resource management questionnaire. performance [2-5]. Organizational effectiveness can be The questionnaire employed a 5-point Likert Scale with assessed internally using the McKinsey 7S framework. It is answers 1 = strongly disagree, 2 = disagree, 3 = doubtful, 4 a tool for analyzing organizational and managerial actions = agree, 5 = strongly agree. The questionnaire was tested by looking at the organization as a whole, so that for validity and reliability with Cronbach alpha> 0.6. Partial organizational problems can be diagnosed and strategies Least Square (PLS) is used to analyze the model to can be developed and implemented (Robert & Thomas, improve organizational performance of public health cent 1980). This model is different from other organizational analysis models, because the framework assesses the overall internal organization and it can diagnose organizational problems and be implemented in organizations. There are seven components in the framework differentiated into hard elements and soft elements. Hard elements are elements that can easily be identified and influenced by management. Hard elements consist of strategy, structure, and system. Soft elements are more difficult to identify because of their dynamic, ever- changing nature and are highly dependent on individuals in the organization. ______

 Mr. Ahmad Masfi, Faculty of Nursing, Airlangga University, Indonesia Dr. Tintin Sukartini, Faculty of Nursing, Airlangga University, Indonesia  Dr. Abdul Aziz Alimul Hidayat*, Departement of Nursing, Faculty of Health Sciences, University of Muhammadiyah Surabaya *corresponding author Email. [email protected]

3. RESULTS TABLE 1. Organizational Factors that play a role in improving the performance of Public Health Centers (N = 226)

Organizational Variables N Percentage Leadership Good 118 52.2 Enough 105 46.5 Less 3 1.3 Salary Good 65 28.8 Enough 156 69.0 Less 5 2.2 Services Good 79 35.0 Enough 143 63.3 Less 4 1.8 Policy Good 76 33.6 Enough 146 64.6 Less 4 1.8 Human Resource Management Good 76 33.6 Enough 139 61.7 Less 4 1.7

TABLE 2. The leadership, salary, service, policy, HR management factors influence the performance of the Public Health Centers Original Sample Sample Mean (M) Standard T Statistics (| O / Results (O) Deviation STERR |) (STDEV) X1 -> Y 0.274679 0.274343 0.097556 2.815610 Significant X2 -> Y -0.749529 -0,717414 0,107148 6.995261 Significant X3 -> Y 0.585491 0,600136 0,109681 5,338110 Significant X4 -> Y 0.537950 0.489836 0.099437 5.409953 Significant X5 -> Y 0 . 310680 0.316057 0.096723 3.212061 Significant

Fig. 1. SEM for Performance Enhancement for

Institutional Performance Improvement of Public services, policies and HR looking at them from the strategy, Health Centers in Sampang District using the structure, system, staff, skills, style, and shared value McKinsey 7S Framework approach. approach. These variables clearly had influence on these centers’ performance. This highlights the usefulness of the Note: McKinsey 7S Framework as a management model to X1 = Leadership, X2 = Salary, X3 = Services, X4 gauge organizational effectiveness in achieving desired = Policy, X5 = Human Resource Management, Y goals [13-17]. This model uses an internal approach as a = Institutional Performance of Public Health tool for analyzing managerial actions that provides a way of Centers. Xn 1 = Strategy, Xn.2 = structure, Xn.3 seeing the organization as a whole, allowing for = system, Xn.4 = skill, Xn.5 = staff, Xn.6 = style, organizational problems to be diagnosed and strategies to and Xn.7 = shared value. be developed and implemented.

4. DISCUSSION 5. CONCLUSIONS The evaluation of Public Health Center Performance The performance of Public Health Centers can be improved covered 5 aspects namely Public Health Center Efforts by using performance improvement models focusing on the (PHE), Public Health Development Efforts (PHDE), entire organization. This include elements such as Individual Health Efforts (IHE), Management of Public leadership, salaries, services, policies and HR, contributing Health Center (MP), and Quality of Public Health Center to strengthening various work principles (strategy, structure, Services (QPS). system, staff, skills, style, and shared value. The performance of the centers can be enhanced by the results of the research by focusing on personnel, teams, or Acknowledgments organizational units in realizing strategic goals that have We gratefully acknowledge the support of the Airlangga been predetermined with expected behavior. Performance University measurement is a process to evaluate an organization’s operational activities in terms of its actions and activities for REFERENCES a certain period in accordance with the objectives set. In [1] T. Hamidah, "Organizational analysis using the Mc other words, performance measurement is an assessment Kinsey 7S Framework approach as an effort to improve of the level of effectiveness and efficiency of organizational performance at the Sampang District Hospital," activities [10-12]. In general, the objectives of measuring Airlangga University, Surabaya, 2014. the performance of the public sector are (1) Measuring [2] L. Chen et al., "Human resources for health: effectiveness of communication strategies (2) Measuring overcoming the crisis," The Lancet, vol. 364, no. 9449, financial and non-financial performance in a balanced pp. 1984-1990, 2004. manner so that it can be traced to the development of [3] F. Rigoli and G. Dussault, "The interface between strategic achievements (3) Accommodating understanding health sector reform and human resources in health," of the interests of middle and lower level managers and Human Resources for Health, vol. 1, no. 1, p. 9, 2003. motivating them to achieve goal congruence, and (4) As a [4] SE Condrey, Handbook of Human Resources tool to achieve satisfaction based on individual approaches Management in Government. John Wiley & Sons, and rational collective abilities [13].The performances of the 2005. centers were average and lacking in various categories. [5] GR Ferris, AT Hall, MT Royle, and J. Martocchio, This was due to several factors, namely the centers failed "Theoretical development in the field of human to implement or deliver certain activities or services, lack of resources management: Issues and challenges for the activity targets, administrative constraints, and Human future," Organizational Analysis, vol. 12, no. 3, 2004. Resources (HR) issues. Activities were not carried out as [6] T. Naipinit, S. Kojchavivong, V. Kowittayakorn, and planned, some activities were not planned for, human TPN Sakolnakorn, "McKinsey 7S model for supply resources were poorly optimized and HR busy with chain management of local SMEs construction administrative work. Presently, the leadership of the business in the upper northeast region of Thailand," organizations of the Public Health Center and the Health Asian Social Science, vol. 10, no. 8, p. 35, 2014. Service has not been evaluated fully. So far, the evaluation [7] Kaplan Hospital, "How the balanced scorecard of activities has only been done through Letter of complements the McKinsey 7-S model," Strategy Responsibility (LOR). Activities implemented have not been Leadership, vol. 33, no. 3, pp. 41-46, 2005. monitored and evaluated properly. Field monitoring and [8] P. Hanafizadeh and AZ Ravasan, "A McKinsey 7S evaluation need to be done to find out whether the activities model-based framework for ERP readiness provided are appropriate, besides helping identify problems, assessment," International Journal of Enterprise provide suggestions and solutions to these problems. The Information Systems, vol. 7, no. 4, pp. 23-63, 2011. implementers, facilitators, and evaluators must understand [9] A. Payne and P. Frow, "A strategic framework for the constraints, weaknesses, and obstacles in carrying out customer relationship management," Journal of activities in each Public Health Center. This can help Marketing, vol. 69, no. 4, pp. 167-176, 2005. improve the performances of these centers ensuring that [10] JR Katzenbach and DK Smith, The wisdom of teams: they provide better quality services. The McKinsey 7S Creating the high-performance organization. Harvard Framework can be used to analyze the performance of Business Review Press, 2015. Public Health Center in Sampang Regency. The analysis looks into several variables namely leadership, salary, 5075 IJSTR©2020 www.ijstr.org INTERNATIONAL JOURNAL OF SCIENTIFIC & TECHNOLOGY RESEARCH VOLUME 9, ISSUE 03, MARCH 2020 ISSN 2277-8616

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