Healthcare Management -- Scope Strategies

Healthcare Management -- Scope Strategies

Expansion, Contraction, and Maintenance of Scope Strategies

The evaluation of the healthcare organization's financial resources and obligations underlie all financial management strategic decisions. The maintenance and expansion of scope strategies typically require investment, borrowing capital, or the acquisition of competing organizations through horizontal integration (Swayne, Duncan, & Ginter, 2006).

Generally, expansion of scope strategies may focus on the acquisition of additional capital or, alternatively, on the attraction of additional talent, such as successful or particularly renowned physicians in the case of healthcare organizations (Swayne, Duncan, & Ginter, 2006). Other strategic approaches for maintenance and expansion of scope by healthcare organizations include investment in new technologies and, on occasion, acquiring properties or relocating as necessary to attract specific talent to whom those choices might be attractive. Finally, contraction of scope strategies for healthcare organizations, as in the case of organizations in general, entails decisions to divest, liquidate, or otherwise convert capital assets into cash assets (Swayne, Duncan, & Ginter, 2006).

Corporate and Division Level Adaptive Strategies

Corporate level or directional strategies are the broadest and largest scale strategies that are, essentially, always made "upstream" from divisional level and adaptive strategies (Swayne, Duncan, & Ginter, 2006). By definition, corporate level adaptive strategies incorporate all subdivisions of the organization and must, necessarily, encompass the respective environmental concerns of each. In principle, corporate adaptive strategies must evaluate the combined strength of all organizational subdivisions to determine the optimal long-term organizational strategic mission based on the combined capabilities and potential of all of its assets (Swayne, Duncan, & Ginter, 2006).

By contrast, divisional level adaptive strategies focus more narrowly on specific market segments that relate to the market strengths, potentials, and weaknesses of individual organizational divisions (Swayne, Duncan, & Ginter, 2006). Whereas corporate level adaptive strategies concern the viability and success of the entire organization, divisional adaptive strategies concern only the business environment of individual divisions largely irrespective of the overall strategic mission of the organization. Consequently, it is possible for the adaptive needs of the organization to dictate adaptive strategies that may seem antithetical to the strengths of divisional components, such as contraction in scope despite operational success at the divisional level (Swayne, Duncan, & Ginter, 2006).

Appropriate Conditions for Corporate and Division Level Adaptive Strategies