A stakeholder-integrated approach to health care management

A stakeholder-integrated approach to health care management

Journal of Business Research 57 (2004) 984 – 989 Editorial A stakeholder-integrated approach to health care management George M. Zinkhana,*, Anne L...

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Journal of Business Research 57 (2004) 984 – 989


A stakeholder-integrated approach to health care management George M. Zinkhana,*, Anne L. Balazsb a

University of Georgia, Terry College of Business, 138 Brooks Hall, Athens, GA 30602, USA b Mississippi University for Women, Columbus, MS, USA

Abstract The health care system contains many actors, stakeholders and clients. The majority of articles on health care in the business administration literature report empirical results that are relevant to one or two or three of these stakeholders. Here, we make some progress toward identifying these key stakeholders and the complex relationships among them. In addition, we identify some key, emerging issues in health care research, including globalization, the influence of technology (e.g., the Internet), the funding of health care research and the diversity of research methods/approaches. While focusing on these issues, we also identify fruitful areas for future research. D 2002 Elsevier Inc. All rights reserved. Keywords: Health care; Stakeholder theory; Marketing; Emerging technologies

1. Introduction Health care researchers hail from many disciplines. Some examples include medicine, pharmacy, business administration, marketing, management, psychology, sociology, epidemiology, public health and many others. In reality, the health care system has many goals. One key goal is improving quality of life. Another related goal is stakeholder (e.g., patient) satisfaction with a particular health interaction or outcome. For instance, does the allergy sufferer who contacts her doctor receive relief? Is the young man who visits his dentist satisfied with that visit and satisfied with the quality of his service interaction? As these final two questions imply, marketing and marketing principles have a role to play in improving or enhancing the quality of health care delivery. The articles in this special issue take a diverse approach to the study of health care management. However, every article reflects a marketing approach, in terms of scope, method and research questions. Nonetheless, these eight articles consider roles for at least nine actors (e.g., hospitals and midwives) and consider a wide variety of outcome variables (e.g., job satisfaction and consumer information search) (see Fig. 1). The purpose of this article is to introduce a stakeholder perspective for thinking about health care management. In addition, we discuss key themes in health care, including globalization, the influence of tech* Corresponding author. E-mail address: [email protected] (G.M. Zinkhan). 0148-2963/$ – see front matter D 2002 Elsevier Inc. All rights reserved. doi:10.1016/S0148-2963(02)00342-9

nology (e.g., the Internet), the funding of health care research and the diversity of research methods/approaches. Section 2 introduces the eight articles in this special issue, with an emphasis on identifying key patterns and findings. Subsequent sections introduce our stakeholder analysis of the American health care system (Fig. 1) and illustrate our major themes.

2. The articles in this special issue Table 1 presents a summary of the eight articles in this special issue. As shown there, four of the articles rely upon a survey of patients or potential patients. A fifth article relies upon a survey of health care employees (e.g., nurses/ midwives). In the two instances where potential patients are surveyed, direct mail lists are used to identify households to include in the sample. Certainly, there are differences between patients and potential patients. This is a classic distinction in marketing management. However, this distinction could have important implications for surveys that define their target market in such radically different ways (e.g., direct-mail households versus respondents from a patient list). There are times when stakeholders (e.g., hospitals, pharmaceutical firms and HMOs) may send out direct mailings to other stakeholders. Thus, a direct mail list is a relevant tool for health care research (especially if the research instrument is a printed questionnaire). But, in terms of future research, it would be interesting to see how these alternative definitions of the population and the sampling

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Fig. 1. A stakeholder approach to health care management. Notes: (circles) actors, organizations; (squares) outcome variables, including perceptions and behaviors; (triangles) media. Numbers correspond to the articles in this issue. See Table 1.

frame influence and/or bias the results. This issue is especially relevant, given that an increasing amount of health care information is being disseminated via the Internet. Thus, the following set of research questions are relevant. How does the medium of communication and delivery influence the quality of health care? How do emerging technologies influence the quality and perceptions of health care? How should research instruments be adapted to take into account the medium that is used to contact stakeholders in the health care system? As an alternative to the survey method, the remaining three articles use related methods from social science

research. Specifically, Singh et. al. create a conceptual model to predict the impact of emerging technologies (e.g., advances in genetic knowledge and biomedical engineering). Zolkiewski reports the results of three case studies completed in the UK. Gruca and Wakefield complete a structural audit of 111 hospital websites. As mentioned above, all of the articles have a marketing orientation (some more than others). For instance, the first and third articles apply literature and findings from relationship marketing to understand the delivery of health care service. Studies 2 and 6 concentrate upon a classic consumer behavior topic-information search (Arnould and Price, 2002).


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Table 1 A brief summary of articles in this issue Authors

Research tradition


Key-dependent variables

Key findings

1. Leisen and Hyman

Psychology/consumer behavior

Survey of 214 patients

2. Rohm and Milne

Public policy

Survey of 1508 directmail households

3. Zolkiewski

Services marketing/ marketing strategy

Three case studies

Trust, relationship outcomes (e.g., loyalty, WOM, following doctor’s recommendation) Consumer sensitivity towards personal information collection and use Service delivery health care providers (in the UK)

4. Gruca and Wakefield

Electronic commerce/ promotion

Structured audit of 111 hospital websites

Information content and delivery strategy

5. Hall, Viney, Haas and Louviere

Choice modeling/ economic evaluation

Stated preference discrete choice modeling (SPDCM)

6. Noble, Schewe and Kuhr

Segmentation analysis

Survey of 184 direct mail households

Four applications demonstrated (e.g., participation in breast cancer screening) Information seeking, patient interaction style with physician

7. Hampton and Hampton

Management, human resources

Survey with 543 nurse – midwives

Job satisfaction

8. Singh, Cuttler and Silvers

Conceptual model

Literature review, hypothesis development

Patient demand and information search

Benevolent and technical dimensions of trust have different antecedents. Consumers do not believe that HC information is used fairly in the marketplace. Relationship management is a key HC tool on both sides of the Atlantic. Hospitals need to find ways to update and add value to websites. SPDCM provides a new way to identify HC attributes that Cs value. HC professionals need to consider generational differences in C preferences. Rewards and market orientation are positively related to job satisfaction. Emerging treatments may generate new patterns of C decision-making.

HC = health care, C = consumer, WOM = word of mouth.

The fifth article (by Hall et al.) applies a classic tool from marketing science (e.g., discrete choice modeling). The article of Noble et al. is a classic study in market segmentation. In contrast, at least two of the articles emerge from related social sciences. Rohm and Milne investigate consumer sensitivity towards the disclosure of personal information. Such a study certainly has roots in marketing, but it can also be considered as representative of public policy research. Hampton and Hampton’s study of job satisfaction emanates from the management or human resources literature. However, the authors include market orientation as a key predictor variable. Thus, even this human resources study has a marketing flavor to it. As described above, seven of the eight studies are empirical. It is interesting to note that five of these report data that are gathered exclusively from the US. The remaining two articles report data from Australia and UK. In terms of future research, it would be interesting to contrast these findings with those resulting from studies of health delivery systems that exist in other (non-English speaking) cultures. As discussed later on, cross-national studies seem to be quite rare in the health care marketing literature. It is difficult enough to understand the health care practices in one country, as these are constantly evolving. Contrasting systems across national boundaries is especially challenging since the systems emerge in response to unique political and cultural conditions. Can a health care system really be studied and evaluated, independent of the macroenvironment that creates and nurtures it? To put this issue another way, there is no guarantee that a health care

innovation developed in North American will work out effectively in other parts of the world.

3. A stakeholder approach to health care Fig. 1 presents a simplified model to portray three components of the American health care system. These components include: (a) actors (e.g., patients and HMOs) who are portrayed with circles; (b) communication media (e.g., the Internet), which are illustrated via triangles; and (c) outcome variables (e.g., compliance with health regimens and word of mouth), which are represented with boxes. Notice that Fig. 1 is designed to portray only those relationships that are explored in this special issue, and it is primarily representative of the prevailing US model. It is, in fact, remarkable that the eight articles in this issue are able to explore so many potential interactions and relationships in the health care system. The fact that these articles differ so radically from one another (in terms of focus) is but one indication of the extreme complexity of health care and health care research. Because of this complexity, it is quite difficult for one article (or one special issue) to make dramatic progress. Nonetheless, health care is such an important segment of the economy and such a key component of human welfare that society and its institutions are willing and able to commit an almost unlimited amount of resources to explore and improve the system. Even though one stream of research may struggle to make a substantive contribution, there is so much potential health-related fund-

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ing that some subset of research agendas eventually proves fruitful and rewarding. And, the pay-off from these research streams is potentially quite extensive (in human terms), given the importance of the topic. Considering that marketing is a general theme of all eight articles, it is not surprising that at least five of the articles concentrate on the physician-to-patient relationship. This kind of focus is at the center of the marketing research tradition, and this relationship is, in some ways, similar to the traditional seller-to-buyer exchange. Of course, health care is complicated so that the patient is often not the (only) actor involved in paying for the service. Fig. 1 shows the HMO playing this role, but does not show the insurance companies (and government agencies) who also participate in the pricing and payment process. Other actors represented in Fig. 1 are pharmaceutical firms, hospitals, drug stores, grocery stores, the government and government agencies. Important stakeholders that do not appear in the figure include such entities as dentists, insurers (including insurance companies, Medicare, Medicaid), pharmacists (as individuals), detail sales people, mail order pharmacies, Internet pharmacies, hospital pharmacies, specific government agencies (e.g., FDA, FTC and Health Care Financing Administration), organizations that fund health research (e.g., NIH, CDC, universities and the pharmaceutical industry), hospital staff, hospital types (e.g., teaching versus nonteaching, religious affiliation versus not), physician types (e.g., primary care versus specialist), professional organizations (e.g., the American Medical Association), consumer or watch-dog groups, lobbyists, special interest groups and many others. In summary, even though the eight articles included here cover a lot of ground, these articles (as a whole) barely scratch the surface in terms of the many possible relationships and interactions. See James (1994) for an alternative representation of the health care system (as practiced in the UK) and its associated stakeholders. Of course, the figure also presents two media groups, the advertising industry and the Internet. Other possibilities for communication include direct mail, detail sales people (also actors), conferences, symposia and other promotional literature (beyond direct mail). Similarly, the figure shows six outcome variables: word of mouth, compliance with health regimens, loyalty, demand, information search and job satisfaction. First, note that this set is not meant to be comprehensive (in terms of representing the criterion variables explored in the eight articles, which appear in this issue). Rather, this listing of outcome variables is meant to be illustrative. Second, other relevant outcome variables (not appearing in this special issue) could be added to the list. These possibilities include: profitability and viability of the various organizations (e.g., hospitals and physician partnerships), health outcomes, quality of life, service satisfaction, recall or memory, attitudes, perceptions, beliefs and many others. Note that there could be an important distinction made between life quality (which could apply to entire population) and health outcome (which could apply to


the specific experience of one patient with one health care provider). Life quality could be measured in a quantitative way (e.g., with economic indicators) or in a subjective way (e.g., by surveying a sample of the population about subjective well being). An argument could be made that enhanced life quality is the ultimate goal of the health care system (on a national or international level). Information between stakeholders could always flow in both directions. However, in many instances, the primary direction of flow could be in one direction. Consider Fig. 1. In the 21st century, pharmaceutical firms send more information to consumers (e.g., via advertising and the Internet) than typically flows in the opposite direction. In contrast, the communications between patients and physicians is bidirectional. A true relationship can develop between these actors and the patient –physician team makes joint decisions (under some circumstances, see Noble et al.). The word-of-mouth communication that emanates from the interaction of patient and physician may create information flows that influence consumers in unintended ways. Just as the figure omits many stakeholders, it also omits many direction flows (especially two-way flows). Again, the figure is constructed to illustrate the primary thrust of the research that appears in this special issue.

4. Emerging technologies At least two of the articles in this special issue (e.g., Rohm and Milne, Gruca and Wakefield) explicitly consider how the Internet is influencing the health care system. A third paper (by Singh et. al.) considers how other emerging technologies (e.g., advances in genetic knowledge and biomedical engineering) influence the system. Without question, the greatest chances for health care enhancement come from advances in the natural sciences (e.g., biology, medicine and chemistry). However, as illustrated in this issue, enhancements may also derive from improvements in the administrative sciences—one of which is marketing. At one time or another, the following stakeholders could be considered to be customers—patients, physicians, the public at large, the government, pharmacies and others. Thus, marketing concepts could be applied to the delivery of products and services to these customers. Advances in marketing thought (e.g., relationship marketing and services marketing) can be used to improve the business operations associated with the health system. The Internet is an emerging technology that has the potential to revolutionize many aspects of business theory and practice (Watson et al., 2000a,b). In a health care context, consider some of the following possibilities. First, the Internet can be used to deliver services (e.g., to those in remote areas). In a related vein, mobile commerce (mcommerce) can be used to automate the delivery of life saving drugs and, simultaneously, to alert emergency personnel that there might be a health problem developing


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(Watson et al., 2002). For instance, a specialized wrist watch could be designed to monitor the wearer’s pulse rate, hormone levels or other vital signs. If a threatening situation is detected (by devices in the watch), then the following sequence of events could be initiated. A corrective drug is automatically administered to the wearer of the watch. Appropriate telephone calls are made to the ambulance service, the patient’s primary care physician and to the nearest emergency room. Third, the Internet can be used to enhance communication between relevant stakeholders. If the interactive elements of the Internet are harnessed, then knowledge flows can be both more precise and more efficient. At the same time, decision making could be enhanced. Fourth, the Internet can be used to improve the internal communications of an organization (Watson et al., 2000a). For instance, a hospital could use an intranet to communicate with employees (e.g., to schedule works shifts or vacation schedules). An extranet (Watson et al., 2000a,b) could be established with a hospital’s key partner (such as a physician’s office), and this information technology can serve to link business partners more closely (both in terms of communication and in terms of business transactions). To date, one of the biggest disappointments in information technology is the failure to create a nationwide system for patient records. There are a number of reasons for this failure. The Internet could serve to overcome some obstacles (e.g., communicating and updating records in a standardized and nationwide manner). However, other obstacles remain (e.g., concerns about privacy and unauthorized use of information stored in comprehensive databases).

5. Globalization Globalization is a trend that affects almost all human activities. Of course, this trend is not without its opponents. Traditionally, health care is a local matter. In the 21st century, opportunities for global expansion abound. True universal health care would mean that every human on the planet has access to excellent care. Health and health care are certainly building blocks for the enhancement of life quality and subjective well being. From a business perspective, pharmaceutical firms see emerging opportunities in a global marketplace—both in terms of production and in terms of sales. Of course, the Internet enhances opportunities for global communications and/or the delivery of services in a way that defeats traditional limitations on physical distribution. Many health care products consist of knowledge (e.g., a doctor’s diagnosis), and such knowledge can be delivered via the Internet in ways that many physical products (e.g., a prescription drug) cannot. Nonetheless, there are e-pharmacies that challenge the success and market domination currently enjoyed by bricks-and-mortar enterprises. Every nation has its own unique health care system. For cultural and political reasons, it is not feasible to transport

entire health systems across national borders. In the same way, individual health products often have trouble making this kind of transfer in a seamless fashion. More research is needed on comparative health systems and on understanding the cultural and political environments that spawn existing practices. One weakness of this special issue is that the all of the studies are conducted inside the borders of a single country. Of course, there are many challenges and obstacles that make it difficult to conduct a research project that compares the health practices in just two countries. In the field of international marketing research, studies that compare only two countries are considered passe and much too limited to generate useful knowledge. Following this tradition from international marketing, we must find ways in health care marketing to stimulate and complete research projects that are truly international in scope.

6. The funding of health care research As discussed above, the potential societal benefits associated with health care research are practically unlimited. In the US, the National Institutes for Health sponsor considerable research efforts. It is noteworthy that one of the articles in this issue (i.e., by Singh et. al.) is sponsored by the NIH. Another study (by Rohm and Milne) is sponsored by the Marketing Science Institute. For the most part, published academic research in marketing does not have prestigious, well financed sponsors. Thus, it is encouraging to see that marketing research, in the health care area, is able to attract attention from prestigious funding agencies. At the same time, such sponsorship (especially sponsorship from industry) brings controversy. In the medical field, a number of journals have established stringent guidelines to limit the publication of research that results from private sponsorship. Among the areas of concern are the following questions. Who has control of the data? Does the sponsor have veto power over the publication of results? Who performs the data analysis? What forms of censorship may be operating? To what extent is the free flow of information or the freedom of inquiry inhibited? To date, such questions have not been addressed in a systematic way in the field of academic marketing research. In the near future, we may need to imitate the practices and intellectual conscience of our brother and sister researchers in the biological and medical sciences. The issue of sponsorship is not completely irrelevant to the publication and dissemination of academic marketing research.

7. Diversity of research methods As described above, the complexity of the health care system makes it difficult to study. Potential approaches include the traditions provided by the fields of biology, medicine, chemistry, human resources, psychology, epi-

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demiology, public health, sociology, management, marketing and many others. When considering this array of disciplines, marketing seems one of the least likely to generate useful or productive knowledge (from a health care perspective). Nonetheless, as illustrated in this special issue, marketing thought and marketing methods have something to contribute. As an applied social science, marketing researchers implement a wide variety of methods. Among those illustrated here are surveys, case studies, literature review and model development, choice modeling and content analysis (e.g., a structured audit). In the future, health care researchers may consider an expansion of methods to include such techniques as focus group interviews (e.g., as the basis for an academic article), participant observation, literary criticism, gender studies; experimentation, causal modeling, benchmarking, depth interviews (e.g., of patients and physicians), delphi analysis (i.e., interviews with experts), a theory-in-use approach (Zaltman et al., 1982), meta-analysis or many other possibilities. As discussed above, existing health care systems are so complex that no one method or one approach can even begin to paint a realistic or comprehensive picture.

8. Conclusion Here, we have identified a number of stakeholders who are crucial to the design and implementation of a successful health care system. The articles in this special issue illustrate a wide variety of interactions between these stakeholders (see Fig. 1). Administrative sciences and marketing practice have a lot to offer the various health care providers and


customers. Traditionally, the role of health care marketing has been somewhat limited (especially in Northern Europe), largely because of government regulation or the threat of government intervention. In the latter part of the 20th century, capitalism and free enterprise seemed to deliver a high standard of living to consumers in a wide variety of cultures. In the same way, the application of free market principles (including marketing knowledge) may serve to enhance the delivery of quality health care. Just as is the case for so many societal institutions, the ultimate objective of marketing systems is to deliver a standard of living to the populace and to enhance overall life quality. It may well be that the achievement of this goal is more realistic when marketing concepts are applied to key industries such as health care, in contrast to the situation where marketing concepts are applied to industries that seem less crucial for the achievement of true human happiness.

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