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    Competitive Strategy in Health Care

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    The Health Care Industry

    1. Most people have some familiarity with hospitals and the health care industry. Based on your knowledge, in which quadrant of the staffing policies matrix (figure 4-3) do you think hospitals are located? Are the staffing policies of hospitals more like baseball teams, academies, clubs, or fortresses? Explain your resoning.

    2. Examine the projections for the various health care occupations specialties. Are there substantial differences in the rates at which employment is expected to grow in the different occupations? How have the strategic actions by health care organizations, such as mergers, shifts to preventative approaches, and the focus on cost control, affected the expected growth of the different specialties? How is the market demand for medical care expected to affect employment in the different specialties?

    3. Given the uncertainty of the demand for health care workers, how can health care organizations be prepared to meet their future needs for such employees? How can they help their employees prepare for their employment future?

    4. Do Porters's competitive strategies of cost leadership, differentiation, and niche or fucus apply to hospitals or health care organizations? Explain.

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    Solution Preview

    STEP 1
    The quadrant where the hospital staffing policies are located is the Fortress. The reason is that the source of labor in hospitals is External. Why? Because strict specifications of qualifications makes it impossible to have a seamless promotion path;. For example, a qualified nurse cannot become a physician whatever by her level of competence and experience. In addition, there is a supply of low cost labor at almost all level. Even if doctors are required, they can be recruited from abroad to keep the costs low.
    In addition, the assignment and promotion criteria are group contribution. For, example, it is the governing body or the top management that decided the performance indicators for doctors. The doctors or the nurses have little say in the department they will be assigned to or the criteria used for evaluating their performance. In large hospitals like Kaiser Permanente assignment and evaluation consultants who are often located in a different country do criteria generation remotely.
    Large-scale Layoffs were relatively unknown in hospitals till the recent spate of takeovers and consolidations after which layoffs have become common.

    STEP 2

    Yes there are substantial differences ...

    Solution Summary

    This posting applies the principles of competitive strategy by Porter to Health Care. It examines this application in the background of uncertainness. .