Great expectations: an analysis of four strategies.

Abstract

able body of literature has emerged that urges the transfer of practices common in private industry into the hospital industry. Hospitals are encouraged, for example, to diversify or to develop more sophisticated management systems if they wish to strengthen their competitive position and improve their financial performance. What evidence exists suggests that hospitals have taken these encouragements to heart, presumably to survive and thrive in the changed environment. In this article, the literature describing four such strategies is presented : diversification into long-term care and into ambulatory care centers, and adoption of product line management and cost accounting systems. A close examination of this literature is disquieting. Each strategy has a number of benefits attributed to it. Among others, diversification into long-term care will improve a hospital’s public image (Giardina