Organizational Structure & Service Lines
Service lines allow organizations to concentrate on specific customer needs and this concentration often leads to excellence in the organization's field. Despite the benefits of specialization, this organizational structure has a number of cost considerations.
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Service lines, according to the United Kingdom's independent health service regulator monitor, dedicate specialists in an organization to addressing a specific issue or need, then treat those specialists as a distinct operating unit. Fred Luthens, author of the business book, "Organizational Behavior," describes this arrangement as a divisional organizational structure in which each unit has its own administration and support system.
Benefits
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A service line structure allows specialists to concentrate on a particular issue without administrative distractions like payroll concerns, ordering supplies and human resource management. This arrangement can effectively serve health-related organizations, as teams of specialists can concentrate on specific ailments like cancer, AIDS or heart issues.
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Considerations
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According to Luthens, service line organizations often prohibit overlap of functions between organizational units. This prohibition leads to a need for higher headcount, and makes the structure considerably more expensive to operate than a more open, systemic organization. In addition, some organizations dedicate human resource managers, accountants and other specialists to each service line, and this redundancy of functions makes the operation even more expensive.
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References
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