Orygen FINAL (Assessment 2) PDF

Strategic Plan
2016 - 2021
Integrating Skills and knowledge with the Primary Health Networks
Christian OHalloran - s3487810

Xiaoxue Hu - s3264373
Hayden McHugh - s3436796
Liew Ying Shuang - s3522001
Runhao Chen -s3405714
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Orygen Strategic Plan
Table of Contents
1. Executive Summary .................................................................................................................... 4
2. Introduction ................................................................................................................................. 5
3. Strategic dilemma: ...................................................................................................................... 6
3.1 Contextual Factors to consider: ............................................................................................ 7
3.1.1 Operational funding: ...................................................................................................... 7
3.1.2 Flexible Funding: ........................................................................................................... 7
3.1.3 Programme funding: ...................................................................................................... 7
3.1.4 Innovation and incentive funding: ................................................................................. 8
3.1.5 Supplementary grants..................................................................................................... 8
3.1.7 PHN Objectives ............................................................................................................. 8
3.1.6 Performance Framework:............................................................................................... 8
4. Possible Strategic solutions and major faults.............................................................................. 9
4.1 Porters Broad Differentiation Strategy: ............................................................................... 9
4.2 Cost- Leadership Strategy ..................................................................................................... 9
5. Strategic Solution Integrating Skills and Knowledge with the PHN network ...................... 10
5.1 Differentiation ..................................................................................................................... 11
5.2 Attributes of Differentiation ............................................................................................... 11
5.2.1 Degree of structure:...................................................................................................... 11
5.2.2 Structure of Skills and Knowledge: ............................................................................. 13
5.2.2 Orientation of members towards others ....................................................................... 13
5.2.3 Time orientation: .......................................................................................................... 14
5.2.4 Goal Orientation of members: ..................................................................................... 15
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5.2.5 Implications of Differentiating Skills and Knowledge: ............................................... 15

5.3 Importance of Integration ................................................................................................... 16
5.3.1 Building a Strong Culture ............................................................................................ 16
5.3.2 The Skills and Knowledge Culture: ............................................................................. 17
The Culture for Skills and Knowledge: ............................................................................ 17
6. Implementation ..................................................................................................................... 18
6.2 Timeline .............................................................................................................................. 19
6.3 Addressing Contextual factors through Implementation .................................................... 20
6.3.1. Funding ....................................................................................................................... 20
6.3.2. Establishing Orygen as a leading service provider for PHNs ..................................... 20
6.3.3 Business structure ........................................................................................................ 21
6.3.4 Lack of resources ......................................................................................................... 23
6.4 How This avoids Bad Strategy: .................................................................................... 24
7. Measure success ........................................................................................................................ 25
7.1 Balanced Scorecard ............................................................................................................. 25
7.2 Triple Bottom Line ............................................................................................................. 27
8. Conclusion ................................................................................................................................ 29
References ..................................................................................................................................... 30
Appendix:...................................................................................................................................... 34
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1. Executive Summary
The purpose of this report is to construct an achievable strategic plan for Orygen to implement
over the next five years. This report will be analysing the retrieval of a significant amount of
funding along with the shortage of both physical and human resources. Orygen will have to
secure the $11.1 million in funding from the PHNs as well as the additional $28 million available
annually to enhance the integrate Aboriginal and Torres Strait Islander mental health.
The proposed strategic solution for Orygen to address the uncertainties and dynamic
environment is by using the differentiation-integration strategy developed by Lawrence and
Lorsch. The strategy is effective on two levels, differentiating allows Orygen to respond faster to
the complex environment that disperse resources across 31 regions, while integrative measures
allow diversified services to unify into a common organizational vision of having young people
enjoy optimal mental health as they grow into adulthood (Orygen, 2015).
This will result in localized services being offered to the 31 individual PHNs, enabling each
divisions to apply for funding from all PHNs. The management team will have to consider the
culture, control system along with the structure of the organization. There are four contextual
factors that should be addresses and these factors can identify the things Orygen needs to take to
ensure the strategic dilemma can be solved. The contextual factors that were identified are
getting access to the funding, the establishment of Orygen as a leading service provider for
PHNs, the overall business structure, and the lack of human and physical resources.
Balanced scorecard measures performance from financial, customer, internal business processes,
learning and growth perspective. This allows Orygen to keep track on their financial result as
well as monitor its progress in developing and acquiring advanced intangible asset for future
advancement. Triple Bottom Line for Orygen is the reputation and satisfaction rating from
stakeholders.
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2. Introduction
From 2006-2009 Orygen along with the University of Melbourne were granted $54 million in
order to scale up 30 new Headspace centres across Australia and develop the headspace model
(Orygen 2016). Per the 2015 annual report 34 percent of income ($6.3 million) is from
commonwealth funded grants as well as 26 percent($4.8 million) accounted for through
headspace national funding (Australian Government Department Of Health 2015). This funding
is now jeopardised as the government announced changes that will transition funds away from
existing grant programmes to the PHN network as of 1 July 2016.
In the new structure these 31 PHNs will be responsible for the distribution of all Government
Mental Health funding based on their individual and region specific needs. This therefore
jeopardises up to an enormous 60% of Orygens current funding, as the funding pool for local
headspace sites is transitioning to PHNs from July 1 2016, as well as funding for early psychosis
services (includes Orygen) (Australian Government Department Of Health 2015).
The program is now in its beginning stages with trial sites offering preliminary mental health
services with all primary health networks set to become responsible for mental health services by
2019. (Australian Government Department of Health 2015). To date the PHNs have completed a
regional operational mental health and suicide prevention plan which addresses how the PHN
itself will operationalise its new role (Australian Government Department of Health 2015) as
well as highlight opportunities for working closely with government agencies, non-government
and [importantly] private organisation (Australian Government Department Of Health 2015).
PHNs have also completed a Regional Operational Mental Health and Suicide Prevention Plan
that highlights the region specific needs each Network is facing.Given the program is in its
infancy these plans are merely preliminary and are a method of ensuring the PHNs become
operational, it has also been acknowledged that due to some transition arrangements 2016-17
will have less flexibility than future years (Australian Government Department of Health 2015)
To combat this the differentiation - integration strategy would best suit Orygen, as itallows
companies to adapt to uncertain/ volatile external environment as well as implementing measures
to integrate the operation with the wider organisational goals.
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Triple Bottom Line or TBL is a measure of success. When it comes to Orygen their TBL is their
reputation and satisfaction rating between their staff, government, business partners, the public,
the stakeholders, and the local community.
3. Strategic dilemma:
The strategic dilemma for Orygen is reacquiring the significant amount of funding lost through
the transitioning of mental health funding to the PHN network, as well as the lack of resources
both physical and Human required to respond to the environment.
In the first report it was identified that the 2014 mental health commission review highlighted the
necessity for the government to respond to needs on a local and individual level rather than the
current one size fits all approach. In response the Australian Federal Government has
announced a significant structure overhaul, in order to create an individual need approach that
provides patients with the care they need in regards to their circumstances. As a result, the
government is establishing 31 new Primary Health Networks (PHN) with the aim of creating a
local responsive approach through a more flexible $380 million funding pool.
This is a significant problem for Orygen because, in the new structure these 31 PHNs will be
responsible for the distribution of all Government Mental Health funding based on their
individual and region specific needs. This therefore jeopardises up to an enormous 60% of
Orygens current funding, as transition takeson July 1 2016. The funding will be granted to
PHNs that are determined to have adequate capability to deliver mental health care services, per
the current funding agreement commencing in 2016-17 (Australian Government Department of
Health 2015),
With this, issues also arise in the resource capabilities of Orygen as they dont have the
necessary staff required to effectively deal with so many regions, furthermore Orygen currently
only has one office in Victoria highlighting a lack of physical resources.
In summary, as the PHNs become gradually independent and responsible for how they distribute
funds, Orygen must reacquire $11.1 million in funding that is jeopardised by the restructure as
well as dramatically increase resources.
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3.1 Contextual Factors to consider:

Funding Streams
Within the overall funding structure, the PHN funds are distributed through four streams which
serve as a framework to spend their money through as well as separate supplementary grant
incentives.
3.1.1 Operational funding:
From 2015-16, operational funding is provided for the administrative, governance and core
functions of PHNs. premises; governance; board; core staff; and office administrative costs
including IT requirements. (Australian Government Department of Health 2016)
3.1.2 Flexible Funding:

Flexible funding is provided in order for PHNs to respond to both national priorities outlined by
Government and PHN specific priorities by purchasing/commissioning required services. The
implication of this is PHNs are able to contract medical and health care services that are
appropriate and relevant to the needs of their communities(Australian Government Department
pg. 10, 2016). This will be done in partnership with state and territory governments, general
practitioners (GPs), nongovernment organisations (potentially Orygen), National Disability
Insurance Scheme providers and other related services, organisations and providers (Australian
Government Department of Health 2016).
3.1.3 Programme funding:

Having completed the regional needs assessments for their regions and associated population
health planning PHNs will be able to deliver a broader range of activities in their regions, in the
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form of programs that will involve community participation. (Australian Government

Department of Health 2015).
3.1.4 Innovation and incentive funding:

Innovation funding may be provided to PHNs to enable the Government to invest in new
innovative models of primary health care delivery that, if successful, can be rolled out across
PHNs (Australian Government Department of Health 2016). The higher performing PHNs will
have access to this incentive funding.
3.1.5 Supplementary grants

An additional $28 million available annually to programs that address Objective 6 (refer to
appendix 1.1) of the activity objectives which enhance and better integrate Aboriginal and Torres
Strait Islander mental health (Australian Government Department of Health 2016).
Additional grants are also available for the development of any activities that facilitate
information sharing and communication across all PHNs.
3.1.7 PHN Objectives
Another important consideration is that PHNs have been assigned 6 main priorities including;
Mental Health, Aboriginal and Torres Strait Islander health, population health, health workforce,
eHealth and aged care (Australian Government Department of Health 2016
3.1.6 Performance Framework:

The PHNs will be subject to a performance framework that will identify high and low
performers, this information will be made publicly available.
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4. Possible Strategic solutions and major faults
4.1 Porters Broad Differentiation Strategy:

Porters broad differentiation strategy aims at unique competency. It involves a wider market that
includes creation of unique services. The strategy charges a premium for the service (Buchanan,
2011: 122). For instance, Orygen may charge a fee for providing services to the 31 Primary
Health Networks (PHNs). The strategy may help Orygen earn above average returns in the
provision of youth mental health programs. Porters broad differentiation strategy encourages
barriers to entry hence lowering sensitivity to price by consumers (Armenakis&Bedeian 2009).
Why it Fails
In the case of Orygen, this strategy would not be as effective for the company because it does
not achieve an integration to the whole organisations goals.
4.2 Cost- Leadership Strategy

This strategy aims at low cost competency and efficiency. For the strategy to be successful, it
requires enough market share advantage and better access to required inputs. Cost leadership
strategy usually makes maximum use of all sources of cost advantage. It is said to be sustainable
if it achieves to be the low cost service provider too. The advantage of this strategy is that it
generates increase in market share (Child & Smith, 2007).
Why it fails
The factor makes the cost leadership strategy less effective especially in the context of Orygen
are higher chances of imitation by other firms due to the low cost of learning. It does not focus
on the preferences of customers as it majors on cost minimization. This is not for a company like
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Orygen that operates in a business environment where service is defined by its ability to address
the needs of the users/clients. Moreover, the strategy costs a firm a lot as they are low cost
service providers, this in turn affects the revenues of the business negatively.
5. Strategic Solution Integrating Skills and Knowledge

with the PHN network
The proposed strategic solution for Orygen is to respond to the uncertain and changing
environment outlined in the strategic dilemma by using differentiation-integration strategy first
developed by Lawrence and Lorsch. Doing so will develop a high degree of differentiation and a
high degree of integration the whole organisations mission and vision. In achieving this it will
allow Orygen to capitalise on the funding opportunities through getting access to both funding
streams and the additional funding provisions available for non-government organisations, based
on the PHN programme funding structure. Lawrence and Lorsch Differentiation-Integration
theory is useful in explaining how an organisation should respond to environmental pressures
through differentiating products and/or services, while integrating the products/service to the
overall strategy of the organization. The strategy is effective on two levels, differentiating allows
the organisation to respond quicker to environment changes and pressures, most useful for
unpredictable and/or uncertain environments, the integrative measures allow the diversified
products/services to unify into a collective goal, thus having the sum of all parts being greater
than one large undifferentiated approach attempting to respond to external pressures. This
strategy is particularly useful in the context of Orygens Skills and Knowledge division as they
must respond to a new and highly uncertain external environment, dispersing resources across 31
different regions. The integrative measures will then allow those operations to work towards the
common organisational vision of having young people enjoy optimal mental health as they
grow into adulthood (Orygen 2015).
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5.1 Differentiation
Differentiation is a state of segmentation, splitting organisational systems into subsystems, each

of which tend to develop particular attributes in relation to the requirements posed by its relevant
environment (Lawrence, Lorsch 1967). This is significant when considering the strategic
dilemma Orygen is currently facing, there is high degree of differentiation and uncertainty taking
place in the new PHN structure. An important contextual factor to consider here how Orygen
will reacquire their funding refer to 1.3.4 Contextual factors for details. Consequently, in order to
secure a significant amount of funding Orygen must provide a useable service to a wide range of
PHNs, this is inherently a challenge as each PHN will have regional specific requirements, thus
they will commission services that address their issue the best, therefore a blanket service will
not gain much traction in this highly differentiated environment.
5.2 Attributes of Differentiation

In order to achieve differentiation Lawrence and Lorsch created Four distinct attributes that are
used to identify how a subsystem should differentiate itself based on the characteristics of its
environment (Lawrence and Lorsch 1967). Below, these attributes are explained and placed in
the context of Orygen skills and knowledge environment;
5.2.1 Degree of structure:
Refers to the degree of a formalised structure the subsystem should have, a highly formalised
structure is suited to environments that are high in certainty and therefore become task
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orientated. Environments that are less certain require a less formalised structure in order to adapt
to changes. (Lawrence & Lorsch). To this point Burns and Stalker found that organisations that
profitably [cope] with uncertain, changing environments had a low degree of formalized
structure (organic) (Science Quarterly 2002). In the circumstances of Orygen they would
benefit from an organic structure, providing flexibility and mirroring the external environment
(PHN network). The reasoning behind this is their need to respond to an unprecedented amount
of regional issues as well as provide services that meet various grant availabilities such as
indigenous mental health programmes (refer to 1.3.4 contextual factors). To do this the structure
of the management is an important consideration, for Orygen the aforementioned organic
structure will entail decision making to be made by lower levels of management.
Organic structure Characteristics as described by Burns and Stalker:

Burns and Stalker have devolved numerous characteristics for organic
structure, for the purpose of this report only the ones relevant to Orygen
have been included
1. The contributive nature of special knowledge and experience to the
common task of the concern.
2. The adjustment and continual re-definition of individual tasks through
interaction with others.
3. The shedding of responsibility as a limited field of rights,
obligations, and methods. (Problems may not be posted upwards,
downwards, or sideways as being someone elses responsibility.)
4. A network structure of control, authority, and communication.
5 The Management of Innovation. A lateral rather than a vertical
direction of communication through the organization, communication
between people of different rank, also, resembling consultation rather
than command.
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6. A content of communication which consists of information and advice

rather than instructions and decisions.
(Burns, Stalker, 1961)
5.2.2 Structure of Skills and Knowledge:
When a problem/situation arises in any circumstances in any region, decisions will be made by
whoever shows themselves as the most informed and capable i.e. the best authority based on
the circumstances, rather than having a hierarchy of decisions (Burns & Stalker 1961). Staff will
be made aware of their value in terms of a resource for the organisation, this will empower staff
but it will also ensure they are acting proactively and not sitting back. Staff will communicate
horizontally, meaning that discussions be made without the consideration of roles or position,
facilitating more productive and open discussions, furthermore communication will focus on
consultation and advice rather than giving instructions. These characteristics will allow for an
efficient and effective means of creating services that are responsive to regional concerns and
unexpected issues that may arise.
5.2.2 Orientation of members towards others
Subsystem members in their interpersonal relationships will be primarily concerned with either
task accomplishment or social relationships. Fielder found that task-orientated leadership
associated with effective task performance under conditions of the extreme conditions of high
and low certainty while more socially orientated styles were effective under moderate conditions
of uncertainty. Despite this being the typical case the correlation between these three alternatives
was not very strong in of the three combinations. Therefore, it suggests that task orientation
should take into consideration other factors such as the nature of the industry the organisation
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operates and the goals of the organisation, companies in the non for profit sector will
inherently be more focused on a social orientation.
Orientation of Skills and Knowledge members to others:

Orygen in this sense is not typical as they face extreme uncertainty yet must remain socially
orientated in their interpersonal relationships to suit the nature of the non-for profit industry.
Thus, Orygen must take into consideration how the decisions they make will affect the
individuals in the community they are operating in, members must ensure that all decisions are
in line with Orygens goal of improving mental health outcomes for young people.
5.2.3Time orientation:
This refers to what time period in that goals are accomplished. Companies can possess either a
short term orientation to goals, meaning that feedback is given regularly after tasks are
completed before creating new tasks and goals. Ong -term orientation organisation se goal
accomplishment as more of a process and therefore feedback is not as regular and may be
difficult to measure.
Time Orientation for Skills and Knowledge members:

The PHN structure requires a long term orientation approach due to the fact that it is an
ongoing mission to improve mental health outcomes for young people. Therefore, the skills and
knowledge division should view tasks as ongoing and work to aid PHNs to meet the 6 objectives
they have been assigned (refer to appendix 1.1)
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5.2.4 Goal Orientation of members:

Refers to how concerned members of each subsystem will be focused on their own particular
tasks, i.e. if members of the organisations will focus on the whole organisation or department
goal or their own specific task.
Goal Orientation of Skills and Knowledge Members:

Skills and Knowledge members must ensure they take whole organisational goal in every task
they complete, due to the nature of the organic structure in pace and the fact it applies a team
inclusion mindset to all tasks.
5.2.5 Implications of Differentiating Skills and Knowledge:

Based on the attributes described above, the differentiation of the skills and Knowledge will
mean that the subsystem will be broken into a series of teams that will address issues for each
region of the PHN network. Members of Skills and Knowledge can be assigned to any one of the
PHN regions at any given point in time, whether that be through online consultation or work
done off location or if necessary deployment to the region where the assistance is required. The
assignment of members will be in line with the organic structure in that the individuals with the
best authority will be chosen i.e. members that have the appropriate capabilities to meet the
requirements of this situation. The Skills and Knowledge division will be socially orientated to
members, with emphasis on how decisions will ultimately impact the youth of the region over
the requests of the PHNs. Furthermore, there must be a sense of an ongoing mission to improve
outcomes for youth mental health regardless of previous accomplishments. Finally, The Skills
and Knowledge division must collaborate with one another as well as collaborate with the rest of
the organisation in achieving goals.
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5.3 Importance of Integration

Taking into account the differentiation attributes for Skills and Knowledge (described above) it
is important to consider the importance of integration and the role it plays with the effectiveness
of the entire organisation.
The term integration refers to the process of achieving a unity of effort among the various
subsystems tasks in order to move towards the shared vision and goals of the entire organisation.
(Lawrence, Lorsch, 1967). To this point, in order for the skills and Knowledge division to be
effective overall it must ensure that all the teams working in different regions are aware of the
larger vision of the organisation. This is of significant priority as overall performance in coping
with the external environment is related to having both a degree of differentiation and a degree of
integration consistent with requirements of the total environment (Lawrence & Lorsch, 1967). A
challenge for Orygen is that the high degree of differentiation for skills and knowledge will have
an inverse relationship to the effectiveness of integration (Lawrence and Lorsch, 1967). To this
point, the organic structure and high degree of differentiation required for skills and knowledge
to respond to the PHN network will make it difficult to achieve integration as it will be hard to
avoid the development of clusters in relation to differentiated tasks which in turn leads to
problems in achieving integration (Seiler 1963).
5.3.1 Building a Strong Culture

To combat this Orygen must replace the integrative qualities lost from having a less formalised
structure through building a strong organisational culture. The term Culture refers to a pattern of
basic assumptions that a given group has invented, discovered or developed in learning to cope
with its problem of external adaptation and internal integration (Schein, 1992 p. 9). Some
organisations form a strong culture as a means of adapting to the external environment, in this
sense a strong culture is characterised by intensely held, clearly ordered and widely shared core
values (Robbins et al 2006, p. 411). Furthermore, culture plays an important role in internal
integration and in external adaptation ensuring that an organisations culture, strategy,
environment and technology be aligned with the organisations goals (Robbins, Barnwell 2006,
p. 411). To this point it will be useful for Orygen to adopt a strong culture as it is appropriate in
a dynamic environment, requiring a culture that emphasises individual initiative, risk-taking,
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high integration, tolerance of conflicts and horizontal communication (Robbins, Barnwell 2006,
412). In terms of Orygens problem of achieving integration, this method of culture is the most
appropriate solution and in fact may prove more potent than formal controls, because culture
influences thought processes as well as organisational members actions (Robbins, Barnwell
2006, 413).
This is particularly relevant in Orygens case the organic structure alone may cause
inconsistencies in decision making through the loss of bureaucratic procedures, in implementing
a strong culture the core values that are emphasised will allow to replace formal structure
through guidance of organisational goals that allow employees to self-manage, in consequence it
is therefore appropriate to view formalisation and culture as two different roads to a common
destination (Robbins, Barnwell 2006, 413).
5.3.2 The Skills and Knowledge Culture:

the benefit of strong culture will therefore mean that their thought processes will be more
consistent and in line with the organisations culture across the board. To this point, the stronger
Orygens organisational culture the less need there will be for management to be concerned with
developing formal rules and regulations (Robbins, Barnwell 2006).
The Culture for Skills and Knowledge:

Core Values:
Providingthoughtful and appropriate regional youth mental health training and development
with
Integrity
Collaboration,
and
Consideration
Integrity:
refers to completing tasks in an honest and fair manner to the upmost respect for the lives
impacted by the decisions you make. This will ensure that Orygens services will be elite in the
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industry, providing a competitive advantage over competitors as well as being in line with the
vision to improve mental health outcomes for youth.
Collaboration:
Vital to ensure work done with PHNs is done with a team mindset, different groups within the
organisation must work together and find shared meaning in the overall decision making process.
Consideration:
For the young people that will ultimately be affected by your work, this means always having the
mindset of helping the affected youth over completing a task which may work favourably in the
relationship of Orygen and PHNs as although that relationship is important, above all employees
must remember that improving the lives of young people is the ultimate goal.
6. Implementation
The successful implementation of the strategy above relies on the adoption of organisation
design; the process of deciding how a company should create, use, and combine organisational
structure, control systems and culture to pursue a business model successfully (Hill et al. 2015).
The management team of the Skills and Knowledge division must consider the culture, control
system and structure of the organisation when deciding on the best method of implementation.
To maximise efficiency, quality, innovation along with greater responsiveness to customers
Orygen should be assigning employees to specific tasks and roles that suit their workers
strengths (Hill et al. 2015). To help get the most out of their staff managers must be able
motivate their staff. Control systems give managers the ability to provide their staff with
incentives, an incredibly efficient motivation tool. Below is a timeline for Implementation;
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6.2Timeline
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6.3Addressing Contextual factors through Implementation

6.3.1. Funding
An important contextual factor to consider for Orygen is how exactly they will get access to the
funding, as outlined in the strategic dilemma (above) PHNs have been allocated a significant
amount of flexible funding, this funding has come directly from previous funding programs
that are being transitioned to the PHN network as of 1 July 2016, this includes funding
programs that went directly and indirectly to Orygen such as headspace and early psychosis
services (Australian Government Department of Health 2016 ), all together accounting for
60% of Orygens operational funding, per the 2015 annual report (Orygen 2015).
Using their existing elite research skills Orygen can provide unique region based training
established via their own research division. Region based training is important for the new PHN
based funding scheme as Orygen must be able to sell their services to each individual health
network. As mentioned above, there are 6 individual mental health objectives (Appendix 1.1),
any of which can be achieved in order to secure flexible funding. These objectives are issues that
specific networks must establish as key problems in their area, such as suicide in young people in
regional towns. Implementation of the strategy proposed in this report would rely heavily on
Orygens ability to provide training specialising in the required areas to receive funding directly
from the affected PHN. Another opportunity for funding presents itself is an additional $28
million that is available annually under the Indigenous Australians Health Programme, in
support of objective 6 for Primary Mental Health care (refer to appendix 1.1) (Australian
Government Department of Health 2016 ). Development of a facility or service that enables
information sharing and communication across all PHNs is also a recommended avenue of
funding as their are currently grants being offered for this project. Developing this system would
be a way for Orygen to establish professional relationships with all PHNs without necessarily
being directly commissioned for their services.
6.3.2. Establishing Orygen as a leading service provider for PHNs

In order to gain the funding the Skills and Knowledge division requires to continue to expand
their reach, Orygen must become a major service provider to a majority if not all PHNs in
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Australia. The funding changes that the Australian Liberal government have put in place in
regards to mental health on a whole have been driven by the mental health review discussed in
the previous report. These changes are forcing Orygen to adapt who their services are targeted at
in order to maintain a customer base. Our strategy identifies that Orygen should work with
PHNs in stages, similar to the stages of development of PHNs. If established early in the PHN
development as the leading youth mental health knowledge provider, it is possible a form of
normative institutionalised isomorphism will be established, whereby the structure and services
of Orygen will mirror the expansion and design of the PHNs on a whole. This will be
compounded by new PHNs mirroring the processes of existing networks. Orygen should look to
initially align with high performing PHNs based on the performance framework which will
publicly identify high and low performing PHNs along with potential issues and the possibility
of performance based incentives. If this occurs Orygen will likely become the first point of call
for youth mental health training in every newly created network, thus Orygen will be required to
develop some new region specific material. While this mirrored expansion is an ideal
implementation strategy it will also need to be combined with other methods to ensure Orygens
successful integration into the new health model. Establishing a free information sharing
platform accessible to all PHNs that outlines the best mental health services available for young
people in any region is a method that will both, create new professional relationships with PHNs
and help Orygen achieve their vision as a company. It is also important that Orygen plan a
marketing strategy that will reach new markets, exposing the advantages for a PHN willing to
invest with Orygen. A simple way of doing this may be to run free seminars in areas easily
accessible by representatives of multiple PHNs that show how Orygen will be able to provide
unique services as they are required.
6.3.3 Business structure

The first report identified that Orygens current structure is already struggling to deliver all the
services the Skills and Knowledge division wishes to offer. The strategy recommended in this
report would place even more stress on Orygens employees if the current structure was
maintained. To ensure Orygen will be able to deal with the load placed on them by a new
strategy, it is recommended that Orygen develop a highly integrated organically structured
environment. Orygen requires this flexibility to allow for the high degree of differentiation
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required by the new region based funding scheme. Orygens expansion into new areas should
mirror the expansion of the health networks. As explained above this would form coercive
institutional isomorphism, a paradox where rational actors make their organisations increasingly
similar as they try to change. As other PHNs are developed they are likely to mirror the existing
PHNs further emphasising the coercive institutional isomorphism effect. New PHNs will would
then follow the existing PHNs and look towards Orygen as a source of youth mental health
training.
Orygen must decentraliseas there only office, located in Melbourne, will not be able to provide a
sustainable localised service to each PHN. To counter this issue it is recommended that satellite
offices be commissioned in locations such as Sydney and southern Queensland where there is a
high density of PHNs. While this will be expensive and take time to develop the advantage of
being able to directly interact with PHN representative on a day to day basis in these areas is
essential to Orygens success. It will also make it easier to monitor the implementation and
corresponding success rate of the training Orygen has provided. These invaluable services will
however require an increased level of integration across the entirety of the organisation.
Integration refers to how effectively an organisation can move towards a shared vision or goal
through contributions from smaller groups and teams. This relies heavily on business culture as
the vision of a company such as Orygen should be a driving force for all projects. Culture will
replace the role a formal structure has in guiding the decision making processes of the company.
To ensure that all activities will improve mental health services for young people it is essential to
have strong core values that will always be considered before a decision is made. The core
values that should be implemented with this strategy involve providing quality regional specific
youth mental health training and development with:
Integrity
Collaboration, and
Consideration
Integrity will ensure that Orygens services will continue to be elite in their industry, providing a
competitive advantage over any competitors. Collaboration has been the focal point of the
strategy presented in this report, but this will not only be important for work done with PHNs but
[Date]
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also with different groups within the organisation. Finally consideration is the key to offering the
high quality localised services to individual PHNs, without thorough consideration and
collaboration the localised approach to health simply will not be effective. If these core values
arent followed it may result in persons being excluded from key activities or they may be
spoken to about their actions or subbed in some other way If a person acts in a way which is
not in accordance with the culture of the organisation, they may feel guilt and shame, which may
lead to their not repeating the behaviour. It is through these mechanisms that culture contributes
to the uniformity of behaviour (culture reference).
6.3.4 Lack of resources

Orygen currently lacks the human and physical resources to efficiently implement the strategy
recommended strategy in this report. Hiring more staff is a simple solution to the HR issue
however this will not only cost more but require training and development. Due to the
implemented flexible structure, this training is of increased importance as there will be increased
responsibility on employees resulting in a need for a more highly skilled workforce. A welldefined selection process for new staff will help ensure that the training and development is
efficiently used, reducing costs. Furthermore, Orygen will need to undertake the costly project of
creating offices in new interstate locations as suggested in the strategic plan. Staffing these
offices also poses a dilemma in itself as the heavy reliance on business culture identified above
will make it difficult to hire brand new staff to fill interstate locations. A strategy to solve this
issue is to hire staff that will be in leadership roles in new offices in advance and train them in
the existing Melbourne HQ. This will help new employees adopt the existing culture, as well as
build relationships with the other leaders they will be communicating with over long distances.
During the initial implementation of interstate offices there will be a heavy reliance on regular
face to face meetings to ensure the core values are being maintained in all locations. These
meeting however should be gradually reduced in frequency, relying more on cheaper and more
convenient methods of online communication.
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23
6.4 How This avoids Bad Strategy:

The hallmarks of bad strategy outlined in Rumelts 2011 article The Perils of Bad Strategy
are identified as failure to face the problem, mistaking goals for strategy, forming bad
strategic objectives and avoiding fluff. This article also identifies the roots of bad strategy as
the inability to choose and using a template style planning rather than establishing a unique
strategy. To avoid implementing a bad strategy the strategic plan in this report has been built
from the ground up, initially researching Orygen and their industry, identifying the opportunities
and risks that exist before establishing a plan that will not only make the most of these
opportunities but also manage existing and potential risks. The strategic dilemma section of this
report clearly identifies the problems that Orygen faces, listing them as key contextual factors.
These are then directly addressed in both the strategy and implementation of this strategy,
thereby avoiding the chance of failing to address the problem. While the goals of both Orygen
and the PHNs have been identified and addressed in this report they have only formed a base
from which the strategy has been developed, not being used as a strategy in themselves. As an
example, Orygens vision has been used to develop the core values they should hold but has
avoided using the vision as a method for decision making. Finally the objectives of the strategy
have been developed to focus solely on the strategic dilemma with clear and concise
requirements. Focusing on a single objective at a time with a clear target that will result in a
cascade of positive outcomes is the hallmark of a good strategy.
[Date]
24
7. Measure success
7.1 Balanced Scorecard
The shortcomings of insufficiently comprehensive approach to the measurement of organization
success have led to increase economic risks and problems for organizations, the economy and
society (Hansen &Schaltegger 2016). Performance management systems based mainly on
financial performance measures lack the focus and relevant needed for internal management and
control. These systems were not designed to communicate decision-relevant information to
managers (Atkinson et al. 1997).
Financial measurements by themselves are insufficient for measuring and managing
organizations performance as financial reports only measure past performance and neglected
long term value creation. This issue can be resolve by using the Balanced Scorecard as it retain
financial measurements and complement it with measures from three other perspectives, there
are customer, internal process and learning and growth (Kaplan 2001). Each of these objective is
measured by key performance indicators. The Balanced Scorecard aims at balancing financial
and non-financial, short term and long tern along with qualitative and quantitative success
measures. The implementation of scorecard involves the selection of measures, the collection of
scorecard-related data, formatting and disseminating information (Tayler 2010).
1.
Financial
The financial performance measures refer to the contribution of companys strategy,
implementation and execution (Kaplan & Norton 2000). The financial perspective for Orygen
includes a growth of funding from source like the PHNs. Orygen must certainly monitor their
spending and make decisions in accordance with financial budgets. Orygens success cannot be
measured by how precisely they keep spending to budgeted amounts, or even if the spendings
are restrained so that actual expenses are kept within budgeted amounts. Financial performance
is the result of operational actions and the financial success should be the logical consequences
[Date]
25
of improving the fundamentals (Kaplan 2001). This means that Orygen should make
fundamental improvements in their operation, and their financial performance will improve
simultaneously. For instance, in the initial development as planned in the first year of the
implementation, Orygen should establish a solid training for all regions based on the region
specific research as commissioned by the PHNs.
2.
Internal Processes
Internal business measures emphasized a major shift in Orygens processes and measures of
operating performance, like cost and quality, that will affect objectives. This will give greater
understanding of their progress to work on areas that are lacking. Internal processes measures
should support factors like quality, employee skills and productivity that bear the greatest impact
on customer satisfaction. The information system plays a crucial role in assisting in
disaggregating the measure as there will be a free information sharing platform to all PHNs. In
order to ensure success in the internal process, Orygen will have to appoint employee with a
valid level of skill and experience so that the strategic plan will have a reliable start.
3.
Customer satisfaction
The customer perspective measures Orygens performance with targeted customer and market
segments. In other words, this measure the value Orygen has created for its targeted customers
(Kaplan 2001). Customers perspective tend to fall into four categories, they are quality, time,
performance and service, and cost. Therefore, Orygen should articulate goals for these
perspective and then translate these goals into specific measures. In the third year of the
implementation of the strategic plan, Orygen will have to develop aboriginal mental health
action. In order to do that, Orygen will have to develop an action plan based on factors arises
from customers perspective along with the values that Orygen will create to influence how
customers see Orygen. Aside from that, introducing the first interstate office in the fourth year of
the strategic plan will increase the coverage of the targeted market.
4.
Innovation and Improvement

Although the customer satisfaction and internal processes measures identify the parameters that
is considered most important to Orygen. But the target for success keep changing and intense
[Date]
26
competition make it necessary for Orygen to constantly make improvement to their processes
and service. Therefore, Orygen will have to cope with the dynamic change and competition by
constantly raising their level of expectations and expand their communication channels so that
they can gather as much information as possible. The innovation and learning objectives are
intended to drive improvement in financial, customer, and internal process performance. Such
improvement in Orygen come from service development that would create new sources of
revenue and market expansion (Kaplan & Norton 2000). A supportive climate of empowered and
motivated employees are required to drive the innovations and improvement.
Balanced scorecard put Orygens strategy and vision at the centre. In other words, balanced
scorecard measure are designed to pull stakeholders toward the overall vision. The real benefit of
balanced scorecard come from making it the core management system rather than the a
measurement system. Subsequently, the implementation of balanced scorecard may require
employees to go through training which might result in employee resistance. Moreover, balanced
scorecard might also be costly and time- consuming for Orygen as it the use of balanced
scorecard require a comprehensive understanding and experience of the process. This can be
challenging to organisations to accomplish as it require the right knowledge and skill.
7.2 Triple Bottom Line

Measuring the performance and the success aspects of Orygen will remain highly significant for
evaluating the valued activities that will be added by both the management and the employees.
Orygen will measure their performance based on impact they will make on the 31 PHN centers;
that is by how effectively the mental health problems in Australia. Additionally, they can
measure success by achieving effectiveness and the cost efficiency features, and how they will
manage to implement the best practices in the 31 PHN centers across Australia. The last and
most important measure of success will be through satisfaction of the local community, that is,
the Australian Aboriginal and Torres Strait Islanders.
The social bottom line aspect of the model has been combined to the balanced scorecard. In this
context the organization ought to contemplate on how their operations affect the communities
under which they operate in terms of social, political, and the ethical aspects (Sarkis&aDhavale
[Date]
27
2015). The social agenda of the business has to take sufficient time for consideration.
Additionally, quite a large number of corporations focus mainly on their social capital and only
make sure that the organization performs well. Triple bottom line approach offers a few benefits
to the organization that incorporate this into their operations. The most significant is
enhancement of not only a brand for the organization, but improved reputation with the local
community. The social and economic dimensions can be achieved by the organization through
good reputation and improved brand presence. Implementing the triple bottom line can help
Orygen to increase their revenue through incentives such as government incentives and grants,
donations, among many others, together with increased market share. Besides that, it remains
clear that the leaders ought to view the economic significance aspect more so from the triple
bottom line approach meaning that it can enhance cost saving measures, together with revenue
collected from innovations that come with implementation such as the 31 PHN centers, and new
market opportunities that present themselves (Ahi & Searcy 2015). Another benefit that can
accompany Orygen in triple bottom line approach is improving employees retention. It is
significant to note that the publication of the triple bottom line approach acts with the
responsibility that positions the employer like an employer more so as a choice that can normally
increase the loyalty of employees and help to minimize the turnover attract mainly the
knowledge workers. Besides that, Orygen should realize that a suitable corporate social
responsibility program would help to not only train exceptional talent, but also to retain it.
The Triple Bottom Line is a tool for measuring organisational performance based on the idea that
organisation should measure its performance in relation to stakeholders. However, TBL has not
been successful in penetrating organizational performance systems. This is because TBL is seen
as too complicated and too confronting for organisations that are delayed in economically
dominated ways of thinking.
[Date]
28
8. Conclusion
The most challenging issue for Orygen is that their ability to expand and the resource capabilities
as they have lack of both physical and human resources. The differentiation-integration strategy
would be applicable for Orygen as this strategy is based on the changing and adding to the
existing processes and procedures that Orygen already have in place. This gives Orygen the
opportunities to gain access to both funding streams and the additional funding provisions
available for non government organisations, based on the PHN programme funding structure. To
ensure a successful implementation of this strategy, the management team will have to consider
the culture, control system along with the structure of the organization. The contextual factor that
were identified should also be addressed so that the strategic dilemma can be solved.
[Date]
29
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Appendix:
Appendix 1.1 The 6 Primary Mental Health Objectives
(must be met to secure grants under the mental health programme)
Objective
Description
1. Improve targeting of psychological

Through the development and/or
interventions to most appropriately support
commissioning of low intensity mental
people with or at risk of mild mental illness at health services
the local level
2 Support region-specific, cross sectoral
approaches to early intervention for children
and young people
Implementation of an equitable and integrated

approach to primary mental health services for
this population group.
3 Address service gaps in the provision of

psychological therapies for people in rural
and remote areas and other underserved
and/or hard to reach populations
Making optimal use of the available service

infrastructure and workforce.
4 . commission primary mental health care

services for people with severe mental illness
being managed in primary care, including
clinical care coordination for people with
severe and complex mental illness who are
being managed in primary care
through the phased implementation of primary

mental health care packages and the use of
mental health nurses.
5 Encourage and promote a regional

approach to suicide prevention
community based activities and liaising with

Local Hospital Networks (LHNs) and other
providers to help ensure appropriate follow-up
and support arrangements are in place at a
regional level for individuals after a suicide
attempt and for other people at high risk of
suicide
(Opportunity exists for Orygen Index, can

locate the best treatment efficiently)
[Date]
34
6 Enhance and better integrate Aboriginal

and Torres Strait Islander mental health
services at a local level facilitating a joined
up approach with other closely connected
services including social and emotional
wellbeing, suicide prevention and alcohol
and other drug services.
For this Objective this Annexure to the

Primary Health Networks Grant Programme
Guidelines should be applied in conjunction
with the Indigenous Australians Health
Programme Programme Guidelines, unless
otherwise stated in this Annexure.
Appendix 1.2 Assessment 1 Feedback response

The feedback on the definition of strategic dilemma in the first assignment was that it needs to be
supported with more supporting evidence. Moreover, the arguments should also be supported
with analysis. In this assignment we have incorporated more evidence to support the strategic
dilemma by referring to substantial and significant sources. We have critically evaluated and
analyzed an extensive range of information in this assignment in order to make coherent and
reasonable judgments and arguments.
We are also advised to improve in synthesizing and organizing important empirical, conceptual
and theoretical information to demonstrate insightful pattern. In this assignment, we have worked
in cooperative manner that conjoins everyones part of the report to ensure each part of the
assignment is linked to the part before it. In this way, the flow of the entire report is more
consistent and the justifications are more precise and accurate.
Aside from that, the analysis in the first assignment was not in depth and it is lacked of critical
analysis to come up with an appropriate conclusion. Therefore, in this assignment we attempted
to analyze all information from various different point of view. Moreover, we have presented
sufficient information from relevant sources to draw relevant and appropriate conclusions that
may assist Orygen. The information that was incorporated in this assignment was presented in a
structured and professional manner.
In the previous assignment, the link of the whole report was weak and inconsistent. In this report
we made sure every part linked strongly with another by discussing and agreeing on all the
aspects of the assignment together as a group. In this assignment, we made sure everyone in the
[Date]
35
group was on the same page and agreed to the strategy that was proposed. Evidence of the
arguments in this assignment was also supported with extensive analysis in order to come up
with logical conclusions.
The feedback for the use of information is that many statements, diagrams and tables were not
cited with any reference. Therefore, in this assignment we made sure all the referencing is
complete and the referencing style is consistent throughout the entire report. We also used an
extensive range of relevant information from reliable sources and have cited them accurately. We
had proofread the report to prevent any grammatical and spelling mistakes. Lastly, we have made
sure the style of the report is consistent so it does not lack of professionalism.
[Date]
36

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Strategic Plan

Christian OHalloran - s3487810

5.2.5 Implications of Differentiating Skills and Knowledge: ............................................... 15

3.1 Contextual Factors to consider:

3.1.1 Operational funding:

3.1.2 Flexible Funding:

3.1.3 Programme funding:

form of programs that will involve community participation. (Australian Government

3.1.4 Innovation and incentive funding:

3.1.5 Supplementary grants

3.1.7 PHN Objectives

3.1.6 Performance Framework:

4. Possible Strategic solutions and major faults

4.1 Porters Broad Differentiation Strategy:

4.2 Cost- Leadership Strategy

5. Strategic Solution Integrating Skills and Knowledge

Differentiation is a state of segmentation, splitting organisational systems into subsystems, each

5.2 Attributes of Differentiation

5.2.1 Degree of structure:

Organic structure Characteristics as described by Burns and Stalker:

6. A content of communication which consists of information and advice

5.2.2 Structure of Skills and Knowledge:

5.2.2 Orientation of members towards others

Orientation of Skills and Knowledge members to others:

Time Orientation for Skills and Knowledge members:

5.2.4 Goal Orientation of members:

Goal Orientation of Skills and Knowledge Members:

5.2.5 Implications of Differentiating Skills and Knowledge:

5.3 Importance of Integration

5.3.1 Building a Strong Culture

5.3.2 The Skills and Knowledge Culture:

The Culture for Skills and Knowledge:

6.3Addressing Contextual factors through Implementation

6.3.2. Establishing Orygen as a leading service provider for PHNs

6.3.3 Business structure

6.3.4 Lack of resources

6.4 How This avoids Bad Strategy:

Innovation and Improvement

7.2 Triple Bottom Line

Armenakis, AA &Bedeian, AG 2009, Organizational Change: Review of theory research in the

Australian Government Department of Health 2016, Annexure A1 Primary Mental Health

Australian Government Department of Health 2016, Mental Health PHN Circular 1 - 12

Australian Government Department of Health 2015, PHN Background, Australian Government

Hansen, EG &Schaltegger. S, The sustainability balanced scorecard: a systematic review of

Kaplan, RS 2001, Strategic management measurement and management in nonprofit

1. Improve targeting of psychological

Implementation of an equitable and integrated

3 Address service gaps in the provision of

Making optimal use of the available service

4 . commission primary mental health care

through the phased implementation of primary

5 Encourage and promote a regional

community based activities and liaising with

(Opportunity exists for Orygen Index, can

6 Enhance and better integrate Aboriginal

For this Objective this Annexure to the

Appendix 1.2 Assessment 1 Feedback response

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