C Yauger | PubMed Health

PubMed1997

Pure versus hybrid: performance implications of Porter's generic strategies.

This article identifies the strategic types in the hospital industry based on the hospital's use of Porter's generic strategies in their pure and hybrid forms. The article also examines differences in performance of hospitals across strategic types. Results indicate that hospitals that follow a focussed cost leadership strategy, in general, have superior performance on a variety of performance measures, while hospitals that use a combination of cost leadership and differentiation perform the poorest. Implications of findings for hospital administrators are also discussed.

Cost Control↗

PubMed1997

Performance-oriented: toward a successful strategy.

Changes in the health care industry have profoundly affected hospital management and have caused severe declines in hospital profitability. In 1993, Health Care Management Review reported that the average operating profit margin, around 2% in 1984, had declined to a 0.2% loss by 1990. In the past, hospitals were buffered by entry regulations and cost reimbursement; thus, they rarely dealt with traditional market pressures. But the changed terrain means that competitive factors now underscore all strategic decisions. This study examines the strategic significance of market orientation in the health care industry. The authors identified forms of market orientation by emphasizing different components, and discovered that hospitals fell into four distinct clusters or groups. They also found a critical relationship between market orientation and performance scores on a number of criteria. Finally, the authors suggest that different forms of market orientation should be employed to target specific performance measures.

Economic Competition↗