Strategy

The Emergence of Strategy

During the past several decades, practitioners have been interested in examining and understanding the strategies of health care organizations. Few industries have experienced more “whitewater change” and “turbulent times” than health care. How health care organizations strategically respond to such change has been, and will continue to be, an important topic.

An interest in strategy for organizations emerged as a response to the difficulties of managing efficiency and effectiveness. The first half-century of management and management research was preoccupied with efficiency and focused almost exclusively on internal controllable factors. However, by the 1950s this internal focus was clearly inadequate.

Managers increasingly recognized the limitations of a management theory that did not account for and deal with the external and uncontrollable factors. Events in the 1960s intensified the need for a revision of management theory. This era was characterized by radical new technologies, a dramatic increase in competition, the cold war, shifts in regulatory policy, racial unrest, and a demand for social justice, as well as many other changes.

Strategy Topics

A variety of topics have been incorporated under the general rubric of strategy. Elements of strategy include process, content, contextual issues (the external environment), competitive advantage, strategic groups, the role of the strategist, performance, structure, strategic competencies, decision making, and complexity and chaos as well as a number of related subcategories. However, central to the understanding of strategy is the distinction between strategy as process and strategy as content.

Strategy as Process versus Strategy as Content

The strategy process has been described as primarily focused on the actions that lead to and support strategy including planning methods and decision making (how strategy is formulated and implemented). In contrast, strategy content is characterized as the strategic decision itself, including such decisions as merger, acquisition, divestment, market entry and exit, mobility barriers, product or market differentiation, turnaround, and vertical integration as well as the content of decisions regarding scope and competitive strategies.

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