The appropriate choice of strategic management techniques plays a major role in a health organization. There is no universal answer to the question of choosing strategic options (Ginter, Duncan, & Swayne, 2013). Each organization selects the strategies depending on its policies, strengths, and weaknesses. However, there are several general frameworks helping to make a decision. Three major types of strategies are usually evaluated: adaptive, competitive, and market entry strategies.
Evaluation of Adaptive Strategies
The most common methods to assess the adaptive strategies are SWOT analysis, Boston Consulting Group (BCG) analysis, strategic position and action evaluation (SPACE), product life cycle (PLC) analysis, extended portfolio matrix (EPM) analysis, and some other types (Ginter et al., 2013).
SWOT presupposes the consideration of the strategy’s strengths, weaknesses, opportunities, and threats (Ginter et al., 2013). BCG analysis establishes the connection between cash-generating products and “cash-eaters” (Masterson & Pickton, 2014, p. 269). The success of PLC is based on the approach that all services and products undergo a number of specific stages (Ginter et al., 2013). EMP analysis focuses on the dimension of profitability. This approach is significant for healthcare firms as they may have either high or low market share (Ginter et al., 2013). Adaptive strategies help to delineate the organization’s abilities to earn a positive image.
Assessment of Market Entry Strategies
The appropriateness of market entry strategies is contingent on the organization’s objectives, external conditions, and internal benefits and weaknesses (Ginter et al., 2013). The goals of the company may vary depending on the speed of entering the market and the regulation of services. The assessment of the external environment is necessary to see whether the conditions for entering the market are favorable. Such conditions include the possibility of an alliance or joint venture, the opportunity for licensing or acquisition, and the chances for internal development and rearranging the value chain (Ginter et al., 2013).
Internal strengths and weaknesses are concerned with the organization’s competencies and resources. The analysis of these capabilities enables the organization’s managers to choose the most appropriate market entry strategy (Ginter et al., 2013).
Evaluation of Competitive Strategies
After choosing the market entry methods, it is necessary to delineate the strategic posture and positioning. A beneficial strategic posture relies on the external circumstances, the organization’s vision, and the internal strengths and weaknesses. Segmentation is the most useful tool for resolving which of the strategies will bring the best outcomes (Varghese, 2012). Segmentation strategy is particularly important in healthcare markets where there are various groups of customers (Varghese, 2012).
Positioning methods include differentiation, cost leadership, and focus (Ginter et al., 2013). Their success depends on external risks and internal benefits and limitations. Competencies and resources may include the reputation for quality, integration of skills and resources, process engineering technique, and others (Ginter et al., 2013). Organizational capabilities necessary for product positioning are subjective measurement, strong coordination, regular control reports, and improvements that interest highly-skilled employees (Ginter et al., 2013).
Conclusion
While there is no single approach to choosing the organization’s strategy, there are some common assessment tools that help to evaluate the effectiveness of the methods preferred by the company. The process of evaluation usually deals with such strategies as adaptive, market-entry, and competitive. When all types of strategies a chosen, it is necessary to check whether they all fit together. The appropriate choice of tools and methods enables organizations to achieve the most beneficial outcomes.
References
Ginter, P. M., Duncan, W. J., & Swayne, L. E. (2013).Strategic management of health care organizations (7th ed.). San Francisco, CA: Jossey-Bass.
Masterson, R., & Pickton, D. (2014). Marketing: An introduction (3rd ed.). Thousand Oaks, CA: SAGE.
Varghese, J. (2012). Strategy. Bloomington, IN: AuthorHouse.