_____________________________ involves an awareness of the environment;intellectual curiosity that is always gathering, organizing, and analyzing information; and a willingness to be open to creative ideas and solutions. Strategic planning concerns reaching conclusions based on information, setting a course of action, and documenting the plan. Therefore, strategic planning is essentially decision making – determining which strategy to pursue from among the many available options. In addition, a health care organization may pursue several different types of strategies simultaneously or sequentially.There is a ________________ in making strategic decisions because as organizations make strategic choices, these choices will have downstream consequences that both limit and create opportunities. For instance, a merger or affiliation decision is part of a series of decisions rather than a single decision or an end in itself; there is a broader strategy that precipitated the merger or affiliation and there will be subsequent strategic decisions that will have to be made to ensure success. ________________________is the process of developing strategic alternatives, evaluating alternatives, and making strategic choices.At each stage of the strategy formulation process, previous upstream decisions and the implications for subsequent downstream decisions must be considered. As leaders work through strategic choices, new insights and perspectives may emerge (________________) that suggest reconsideration of previous strategic decisions. Therefore, although the decision logic for strategic decisions is generally sequential, in practice it is very much an iterative process. Strategy includes a plurality of inputs, a multiplicity of options, and an ability to accommodate more than one possible outcome. For example, where mission and vision are ignored, or where no linkage occurs between vision and strategy, strategy has no measurable end objective. In these situations, strategy suffers from being a means without an end, an end in itself, or a means of achieving an operational end, rather than being a design or plan for achieving the organization’s mission and vision. _____________________ should be based on as much information and strategic thinking as possible. Strategic thinking occurs in situational analysis and strategy formulation, as well as when managing strategic momentum. Before the strategic plan is adopted, it is important to remember that organization-wide consensus and commitment to the strategies must be established and actively promoted if they are to be managed successfully (strategic momentum). The choice of a strategic alternative creates additional direction for an organization and subsequently shapes its internal systems (______________________________). Strategic momentum is reinforced as managers understand, commit, and make decisions according to the strategy._____________________is adding new related or unrelated products/services (businesses) outside the organization’s core business(es). Diversification strategies, in many cases, are selected because markets have been identified outside the organization’s core business that offer potential for substantial growth. Many hospitals have added hospice care as the increasing number of baby boomers are living longer and insurers (including Medicaid) began reimbursing for this type of care. Often, an organization that selects a diversification strategy is not achieving its growth or revenue goals within its current market, and these new markets provide an opportunity to achieve them. There are, of course, other reasons why organizations decide to diversify. For instance, health care organizations may identify opportunities for growth in less competitive or less regulated markets (such as medical office buildings, long-term care facilities, or outpatient care).Diversification, at the level of the individual organization, is generally seen as a risky alternative because the organization is entering relatively unfamiliar markets or businesses. At the societal level it is sometimes thought of as a means of increasing the concentration of power among fewer firms and, again, is viewed as possessing certain dangers or risk.5 Organizations have found that the risk of diversification can be reduced if markets and products are selected that complement one another. Therefore, managers engaging in diversification seek synergy between corporate divisions or strategic business units (SBUs). Consider, for example, the discussion of Hill-Rom in Chapter 4. The core business of Hill-Rom is hospital beds and it dominates the market in this area. In recent years, however, the company has acquired Allen Medical (operating room beds), Liko (specialized products for safe lifting and transfer of patients), Aspen Medical (surgical blades and scalpels), V?ker (long-term care beds), Trumpf Medical (advanced operating room products, lighting, surgical assistance systems), and Welch Allen (medical instruments). Note that these acquisitions are concentric in that they “revolve around” the core business of hospital beds. With these acquisitions Hill-Rom has taken on a risky but a highly diverse portfolio of medical products.A ___________________ is a decision to grow along the channel of distribution or stages in the continuum of care of core operations. Thus, a health care organization may grow toward suppliers or toward patients. When an organization grows along the channel of distribution toward its suppliers or toward earlier stages on the continuum of care (upstream), it is called backward vertical integration. When an organization grows along the channel of distribution toward the consumer/patient or toward later stages in the continuum of care (downstream), it is called _____________________________.________________________is a divisional strategy used to enter new markets with the organization’s present products or services. Specifically, market development is a strategy designed to achieve greater volume, through geographic (service area) expansion or by targeting new market segments within the present geographic area (market niche strategies). Typically, market development is selected when the organization is fairly strong in the market (often with a differentiated product), the market is growing, and the prospects are good for long-term growth. A market development strategy is strongly supported by the marketing, financial, information systems, organizational, and human resources functions. An example of a market development strategy would be a chain of outpatient clinics opening a new clinic in a new geographic area (current products and services in a new market).One type of market development is called horizontal integration. ______________________ is a method of obtaining growth across markets (in essence buying market share) by acquiring or affiliating with direct competitors rather than using internal operational/functional strategies to take market share from them. Many hospitals and medical practices engage in horizontal integration, creating multihospital systems. Such systems were expected to offer several advantages such as increased access to capital, reduction in duplication of services, economies of scale, improved productivity and operating efficiencies, access to management expertise, increased personnel benefits, improved patient access, improvement in quality, and increased bargaining power with insurers and suppliers. However, many of these benefits have not materialized and consolidation often raises prices with no measurable impact on quality – increasing scale without creating solutions ________________________is a reduction of scope strategy involving the termination of a unit through the sale of its assets. The assumption underlying a liquidation strategy is that the unit cannot be sold as a viable and ongoing operation. However, the assets of the organization (facilities, equipment, and so on) still have value and may be sold for other uses. Organizations may be partially or completely liquidated. Common reasons for pursuing a liquidation strategy include bankruptcy, the desire to dispose of non-productive assets, and the emergence of a new technology that results in a rapid decline in the use of the old technology.One strategy of the MedCath Corporation illustrates an example of liquidation. On September 21, 2012 a Certificate of Dissolution was issued for MedCath Corporation. MedCath consisted of a series of hospitals that specialized in cardiovascular care. Its strategy was to operate these specialty hospitals in partnership with physician groups. Although the strategy was successful initially, the opposition of acute care hospitals resulted in a moratorium on specialty hospital development, which proved to be a mortal blow to the strategy and the company. MedCath’s board of directors approved a “liquidating distribution” of assets to stockholders, removed its stock from trading on the NASDAQ stock exchange, and ceased operations.A ___________________________ reduces the scope of operations, through redefining the target market, cutting geographic coverage, reducing the segments served, or reducing the product/service line. Typically a retrenchment strategy is a response to declining profitability, usually brought about by increasing costs. The market is still viewed as viable, and the organization’s products/services continue to have wide acceptance; however, costs are rising as a percentage of revenue, placing pressure on profitability. Retrenchment typically involves a redefinition of the target market and selective cost elimination or asset reduction. Retrenchment is directed toward reduction in personnel, the range of products/services, or the geographic market served and represents an effort to reduce the scope of operations.Over time, organizations may find that they are overstaffed given the level of demand. As a result, their costs are higher than those of competitors. When market growth is anticipated, personnel are added to accommodate the growth, but during periods of decline, positions are seldom eliminated. A reduction in the staff members who have become superfluous or redundant is often central to a retrenchment strategy.____________________________ is an agreement for rights to a technology, product, trademark, franchise, or exclusive geographic area (territory) developed by one organization and used by another for a fee. The da Vinci laser “knife” was licensed to surgeons. Acquiring a technology or product through licensing may be viewed as an alternative to acquiring a complete company. Licensing agreements obviate the need for costly and time-consuming product development and provide rapid access to proven technologies, generally with reduced financial and marketing risk to the organization. However, the licensee usually does not receive proprietary technology and is dependent on the licensor for support and upgrades. In addition, the upfront dollar costs may be high. _____________________________ are a number of different strategies used simultaneously to achieve goals/objectives for different products/services or service areas. Combination strategies are often used, especially in larger complex organizations, because no single strategy alone may be sufficient. In highly competitive markets, “…profitable growth comes when a company pushes out the boundaries of its core business into adjacent space. To understand the decisions that have to be made in strategy formulation, a strategic thinking map depicting a hierarchy of strategic alternatives is useful. There are several types of _____________________, and several strategic alternatives within each type are available to health care organizations. In addition, there is a general sequential decision logic in the strategy formulation process. First, directional strategies must be articulated through the organization’s mission, vision, values, and goals. Second, adaptive strategies are identified, evaluated, and selected. The adaptive strategies are central to strategy formulation and delineate how the organization will expand, reduce, or maintain the scope of operations. Expansion strategies include diversification, vertical integration, market development, product development, and penetration. Reduction strategies include divestiture, liquidation, harvesting, and retrenchment. Finally, maintenance of scope strategies include enhancement strategies and maintaining the status quo.The third type of strategic decision concerns the market entry/exit strategies. Expansion and maintenance of scope strategies call for entering or gaining access to the desired market. Market entry strategies include acquisitions and mergers, internal development, internal ventures, reconfiguring the value chain, alliances and joint ventures, licensing, and venture capital investments. Any of the market entry strategies may be used to carry out an expansion or maintenance of scope adaptive strategy. Market exit may be quick or incremental or partial or complete depending upon the strategy and goals of the organization.The fourth category of strategy includes the competitive strategies which are market-based strategies. _____________________________________________ specify the strategic posture of the organization and position the products and services vis-?vis competitors. The organization’s strategic posture should be carefully considered by its leadership. Strategic posture specifies the organization/market relationship and provides decision and culture guidelines for management. Strategic postures that may be adopted by an organization include defender, analyzer, prospector, or reactor (although the latter usually indicates the lack of a strategy). In addition, positioning strategies (often called generic strategies) include cost leadership and differentiation, both of which can be applied as marketwide strategies or focus strategies (a market segment strategy). Each of the generic strategies places different demands on the organization and requires unique resources, competencies, and capabilities.The ______________________________________ provides a sequence for making the strategic decisions. However, the selected strategic alternatives must be viewed together to ensure their fit and consistency. In addition, it is unlikely that a single strategy will suffice for an organization. Several strategic alternatives may have to be adopted and used in combination. For instance, one service category may require market development whereas a different service category may require harvesting. One division may be a defender, positioned as a cost leader and another may be a prospector, pursuing differentiation. Furthermore, several strategic alternatives may be seen as phases or sequences in a broader strategic shift. Chapter 7 presents several frameworks to help managers think about and evaluate strategic alternatives that are most appropriate given the organization’s external environment, competitive advantages and disadvantages, and directional strategies. Health ScienceScienceNursingGet a plagiarism-free order today we guarantee confidentiality and a professional paper and we will meet the deadline.
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