Authors : Majid Twahir, Peter Kiriri and Maina Muchara
Abstract: Strategic positioning is about how a company positions itself to create value different from competition. The core value is what then the customer consumes. In the health industry it is healthcare. Health care quality comprises of technical and functional components. What is in the purview of the patient is the functional quality. The patient makes a choice of hospital depending on this functional quality. On the other hand, hospital leadership have access to data on technical (clinical) outcomes. The hospital leadership basis of competition tends to be technical quality. This may cause a misalignment between patient’s expectation and the basis of competition. Doctors and medical insurance providers influence patient’s choice of hospital. The perception of quality from patient’s, doctor’s and medical insurance provider’s point of view was evaluated using a modified SERVQUAL tool, a questionnaire that is based on the identification of the expectation-experience gap. The study, then linked this customer experience to perceived (current) strategy and the customer expectation to anticipated (future) strategy. In doing so, the study defined an optimal strategic position. Michael Porter defined strategic positioning as cost leadership, product differentiation and market focus. Currently, many of the hospital are perceived to be strategically positioned based on product leadership. Nevertheless, shifting the focus to cost leadership and transferring the benefit back to the patients (price leadership) is the most sustainable strategic positioning. This was a perception study. No in-depth attempt was made to explain the reason for the perception of the various customers.
Majid Twahir, Peter Kiriri and Maina Muchara, 2017. The Optimal Strategic Positioning of Private Hospitals Incorporating Patient’s Perspective. International Business Management, 11: 1908-1917.