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Five focus strategies to
organize health care delivery
Antti Peltokorpi
Department of Civil and Structural Engineering, School of Engineering,
Aalto University, Aalto, Finland
Miika Linna and Tomi Malmström
Department of Industrial Engineering and Management,
School of Science, Aalto University, Espoo, Finland
Paulus Torkki
BIT Research Centre, Department of Industrial Engineering and Management,
School of Science, Aalto University, Espoo, Finland, and
Paul Martin Lillrank
Department of Industrial Engineering and Management,
School of Science, Aalto University, Espoo, Finland
Abstract
Purpose –The focused factory is one of the concepts that decision-makers have adopted for
improving health care delivery. However, disorganized definitions of focus have led to findings that
cannot be utilized systematically. The purpose of this paper is to discuss strategic options to focus
health care operations.
Design/methodology/approach –First the literature on focus in health care is reviewed revealing
conceptual challenges. Second, a definition of focus in terms of demand and requisite variety is defined,
and the mechanisms of focus are explicated. A classification of five focus strategies that follow the
original idea to reduce variety in products and markets is presented. Finally, the paper examines
managerial possibilities linked to the focus strategies.
Findings –The paper proposes a framework of five customer-oriented focus strategies which aim at
reducing variety in different characteristics of care pathways: population; urgency and severity;
illnesses and symptoms; care practices and processes; and care outcomes.
Research limitations/implications –Empirical research is needed to evaluate the costs and
benefits of the five strategies and about system-level effects of focused units on competition
and coordination.
Practical implications –Focus is an enabling condition that needs to be exploited using specific
demand and supply management practices. It is essential to understand how focus mechanisms differ
between strategies, and to select focus that fits with organization’s strategy and key performance
indicators.
Originality/value –Compared to previous more resource-oriented approaches, this study provides
theoretically solid and practically relevant customer-oriented framework for focusing in health care.
Keywords Service delivery, Demand management, Focused factory, Production strategy,
Supply management, Health care delivery
Paper type Conceptual paper
Introduction
Health care authorities and managers need to answer certain questions. Should there be
one large hospital serving all the health needs of a population or several smaller units
with varying profiles, specializations and target segments? Should professionals be
encouraged to specialize in increasingly narrow fields or asked to develop broad skills
and exploit cross-specialty synergies? The phenomenon behind these questions is
International Journal of Health
Care Quality Assurance
Vol. 29 No. 2, 2016
pp. 177-191
© Emerald Group Publishing Limited
0952-6862
DOI 10.1108/IJHCQA-05-2015-0065
Received 20 May 2015
Revised 24 August 2015
Accepted 20 October 2015
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/0952-6862.htm
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focus. In industry, the focused factory (Skinner, 1974) means organizing work and
equipment to focus on a limited range of products or markets. Reduced complexity
contributes to productivity and quality improvement.
In manufacturing, focus has been successful (Ketokivi and Jokinen, 2006; Hyer et al.,
2009). In health care, the results are conflicting. Some studies found no permanent
improvements (Liedtka and Whitten, 1998; Byrne et al., 2004; Young et al., 2004). Others
reported that specialty hospitals perform better than general hospitals in their field of
expertise (Kumar, 2010). The conflicting evidence leaves several questions. Is the
empirical research simply insufficient, or is it poorly executed? Could it be that
the focus concept is not applicable to the diversity and complexity of health care?
Has the focus concept been defined imprecisely so that operationalization and
measurement remain fuzzy? The purpose of this paper is to discuss these issues by
drawing on operations management and organization theory literature and then
proposing a solution.
First, we review the literature on focus in health care and conclude that there are
conceptual challenges. Second, we develop a definition of focus in terms of demand and
requisite variety. Third, we explicate the mechanisms of focus in standard operations
management terms. Fourth, we present a classification of five customer-centred focus
strategies in health care that follow the original idea to reduce variety in products and
markets. Fifth, we discuss some practical implications in terms of demand, supply
and performance management as well as the challenges and solutions facing the
coordination of care pathways in health care systems with focused operations. Finally,
we present lines of future research.
An overview on focus in health care settings
In general, focus can be defined as a way to systematically manage variety by
controlling demand and supply. An overview of previous research reveals that the
concept initially emerged in health care during the 1990s as patient-focused care
(e.g. Brider, 1992; Lathrop, 1993), underlining the coordination of clinical care across a
continuum of sites and services and organizing resources around patients rather than
specialized departments. As those studies highlighted the shift in management from
specialties to the flow of patient care, they paid less attention to the management of
variety, which is at the core of the original idea of focus (Skinner, 1974). Later empirical
studies took variety reduction into account, and focus has been defined as narrowing
the range of:
(1) demand, defined by demographic characteristics, symptoms or urgency and
severity of patient groups (Liedtka and Whitten, 1998; Byrne et al., 2004; Young
et al., 2004; Hyer et al., 2009; Pieters et al., 2010);
(2) process types and care pathways, defined, e.g. by the number of different
surgical operations (Farris, 1993; Al-Shaqha and Zairi, 2000; Bredenhoff et al.,
2010; Kumar, 2010); and
(3) medical specialties, such as focusing on cardiologic or orthopaedic resources
(Farris, 1993; Al-Shaqha and Zairi, 2000; Young et al., 2004; Kumar, 2010;
Bredenhoff et al., 2010; McDermott and Stock, 2011; McDermott et al., 2011).
The emphasis of focus can be either on the demand or process part of operations.
Narrowing the range of demand means segmenting customers before diagnostics.
Narrowing the range of process means concentrating on the management of care
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episodes. Narrowing the range of specialties provides a resource allocation-based
approach to focusing. Confusion between specialty focus and other definitions appear
in some articles (e.g. Farris, 1993; Al-Shaqha and Zairi, 2000; Kumar, 2010). Demand-,
process- and specialty-based focused units are investigated simultaneously. In some
papers, the demand- or process-based definition is used in the theoretical part, but
operationalization takes a specialty-based approach (e.g. Young et al., 2004).
In practice, focus has been implemented by stand-alone centres (McDermott and
Stock, 2011) by setting up specific centres within general hospitals (Hyer et al., 2009),
or by arranging specific pathways for certain diagnostic groups inside medical
specialties (Liedtka and Whitten, 1998). It is unclear, however, how the organizational
structure affects performance and how different care episodes are managed at the
system level. There is also the issue of temporal focus, e.g. a focused cataract surgery
system is created by organizing specific sessions for groups of similar patients weekly
within a general unit. Although this kind of virtual focusing does not fulfil the
organizational meaning of focus, it could be useful to investigate whether a temporal
focus would be enough to get the main advantages of the concept.
The effects of focus on performance are moderate, mixed or missing. Performance
has been measured as mortality (Hyer et al., 2009), patient and personnel satisfaction
(Farris, 1993; Liedtka and Whitten, 1998; Young et al., 2004), length of stay (Farris,
1993; Liedtka and Whitten, 1998; Byrne et al., 2004; Hyer et al., 2009), financial margins
(Hyer et al., 2009), cost-weighted DRGs produced (Liedtka and Whitten, 1998), resource
utilization (Byrne et al., 2004; Bredenhoff et al., 2010) and total costs (McDermott and
Stock, 2011; McDermott et al., 2011). While some studies indicate improvements in
quality (Farris, 1993; McDermott et al., 2011) or efficiency (Kumar, 2010; McDermott
and Stock, 2011; McDermott et al., 2011), others have mixed or even negative findings
(Liedtka and Whitten, 1998; Byrne et al., 2004; Young et al., 2004; Hyer et al., 2009).
Authors of studies that demonstrate positive impacts argue that findings are valid only
in the selected case context (Al-Shaqha and Zairi, 2000) or when connected to the
specific strategic intentions (McDermott et al., 2011).
Given the plethora of definitions, implementations and performance measures, the
empirical evidence does not say much. Disorganized definitions of focus have led to
findings that cannot be generalized or utilized systematically. Empirical research is also
typically based on one or a few cases. One successful case proves that an implementation
is doable in the given context. Broad data-based surveys cannot be properly done as long
as definitions and measures are imprecise. Resource and specialty-driven approaches,
which are typical for health care, especially in the public sector (Walley, 2013), have also
been mixed with focus definitions, although the original idea of focus was to decrease
variety primarily in markets, technologies and products (Skinner, 1974).
In summary, conceptual work is needed to identify what focus fundamentally
means; what types of focus there are (ontology); what can be known about focus and its
implementation and effects (epistemology) and the mechanisms and interactions
that focus causes or enables in different settings; and what activities and solutions
are required within a focused unit and in its interface with other providers
(management technologies).
The focus concept
In his seminal article, Skinner (1974) stated that focus is a strategic choice to avoid
falling into the trap of being everything to everybody. A factory cannot perform
equally well by every yardstick: short cycle times, superior quality, dependable
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deliveries, flexibility and low cost. Limited resources, capital equipment, competence
and labour should be concentrated on doing a few things exceptionally well.
The phenomena underlying focus are variety and variation. Variety means the
number of discernible states a system can be in (Ashby, 1956). A population in a given
catchment area can be seen as a system that exhibits variety in its demand for health
services. Patients may have different health problems in various combinations and
different symptoms and urgency profiles. Needs arise at different times and locations,
and patients have different abilities to articulate their problems and contribute to their
care (Frei, 2006; Berry and Bendapudi, 2007). To respond to demand variety, the supply
side needs equal or “requisite variety”(Ashby, 1956; Godsiff, 2010).
Variety should not be confused with (statistical) variation, which means either
uncertainty in the demand incidence or deviations from a given performance target,
such as quality and cost. These are widely considered in quality management
(Oakland, 1999). While variety can be seen as enrichment in terms of a higher
granularity of needs, wants and styles, variation is associated with loss, as deviations
from given targets incur the cost of poor quality. While variety is a definition of the
range of customer requirements, variation is a measure of how well specific
requirements can be met (Lillrank, 2003).
To maintain the requisite variety of supply to meet all the variety demanded at all
times and locations would be prohibitively expensive, as it would require excessive
overcapacity. Therefore, organizations have developed three strategies to deal with
variety: variety can be amplified, absorbed or reduced (Godsiff, 2010). Each strategy
responds to different demands and objectives and leads typically to different
organizational forms.
Variety-amplifying organizations seek to develop sufficient requisite variety by,
e.g. multi-skiled multifunctional teams that are designed to deal with variety.
High-variety organizations are typically expensive to maintain. Therefore, they need to
concentrate on products and services with high value added, such as custom-made
products, that justify the high price. Integrated care units, such as migraine clinics, can
deal with the variety associated with complicated cases but not necessarily across
different cases. From this it follows that variety-amplifying organizations need to focus
on a certain type or range of demand.
Variety-absorbing organizations seek to limit variety by restricting their offerings to
one or a few elements of the total service and leaving the others for customers to carry.
Self-service is a typical example. In health care, engaging and empowering patients can
absorb variety by inducing patients and their relatives to manage parts of their own care.
Variety-reducing organizations can segment, screen, and gatekeep demand; arrange
resources into functional specialties; organize around processes and their outputs and
offer services only at certain locations and/or at certain times. Through selection,
screening and triage, only a limited range of predefined varieties is accepted. The
difference between a variety-amplifying and a variety-reducing organization is that
the former allows high variety within cases but restricts variety between cases,
while the latter reduces variety both between and within cases.
Focus can be defined as a way to systematically manage variety by controlling
demand and supply. When an organization narrows its path options, e.g. from all
orthopaedic procedures to endoprosthetics, it also excludes several patient types.
Focusing on certain patient types, symptoms or diseases is the first step toward
organizing a focused unit. Categorizing demand into specific channels, however, does
not yet lead to other needed conditions, such as coordination of different urgency and
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care types, decreased variety at the patient and resource levels or the reduction of
variation and the cost of poor quality.
In summary, there are three different generic strategies to achieve focus: amplify,
absorb or reduce variety. Focus as such is not a causal agent or a sufficient condition
for improved performance. Rather, it is an enabling condition that allows the
exploitation of various operations-level management technologies.
The mechanisms of focus
All technologies build on natural or social phenomena that are exploited in a systematic
way for some purpose (Arthur, 2009). For example, antibiotics are based on the
discovery of the biological phenomenon that certain moulds kill certain bacteria. Focus
exploits the basic drivers of productivity: division of labour, specialization,
standardization and knowledge creation (Douma and Schreuder, 2008).
First, a narrow product range implies that demand concentrates, volumes per
product type go up and economies of scale can be exploited. Facilities can be expanded
to their technically optimal size. Production batches can be large, thus minimizing the
ratio of setup time to production time.
Second, a narrow product range reduces complexity. Processes can be standardized
and asset specificity can be increased, i.e. highly specialized one-purpose machinery
can be used.
Third, high volumes over a narrow product range mean increased identical or
similar repetition. By dividing different tasks among different producers, each of them
faces a reduced variety of tasks. It allows statistical control and the discovery of
patterns and mechanisms that can be used to further standardization and the
application of best practices. Underlying patterns and regularities can thereby be
exploited to develop specialized skills, routines and tools. When production processes
become standardized, they can be subjected to experimentation and the discovery of
best practices. This is because if a process is performed differently each time, there will
not be a control group to which altered processes could be compared.
With unrestricted variety of demand, the supply side would be compelled to assess
each case as it comes, employ some algorithms to determine what needs to be done,
activate and set up required resources, take proper action (create value) and evaluate
results (contribute to experience, learning and add to the knowledge repository).
In such a situation, the ratio of value-added time (actions) to various preparations,
and thereby efficiency, remains low. The reduction of the preparations per value-added
time ratio, learning curve, exploitation of economies of scale, scope, density and
agglomeration require specific techniques and processes. None of these appears
automatically as a result of choosing focus. The type of focus an organization chooses
has an impact on what mechanisms are exploited. Just because an organization
announces it has chosen a focus strategy does not mean it implements it properly.
Choice of focus: five focus strategies in health care
The universality of the demand variety vs requisite supply variety dilemma led to the
adoption of focus strategies long before the term was coined. An early focus strategy
was to separate emergencies from planned and elective procedures. That gave rise to
emergency clinics and trauma hospitals. The varying needs of specific demographic
groups, such as children, women, veterans and the elderly, have been recognized, and
hospitals specifically designed for their needs have been built. Eye hospitals have been
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around for some time, focusing on a narrow range of illnesses and cures. Palliative and
end-of-life care has been organized into hospices.
Based on the concept of focus and its current applications, we propose a conceptual
framework of five focus strategies in health care operations (Figure 1). These strategies
can be sequentially positioned on a customer-oriented continuum starting from the
market and demand-based strategies following by supply and outcome-based
strategies. The logic follows a care pathway approach instead of specialty-, resource- or
function-driven approaches. The choice of where to primarily reduce variety has
dynamic effects on the variety on other stages of the care pathway, and different
choices are connected to different mechanisms of focus. Therefore, the framework can
be used to define focus in different cases and to understand the impact of focus
strategies as context-specific issues.
In the first type of focus, variety is narrowed by setting socio-demographic criteria
and serving only certain populations, such as women, elderly people or veterans. The
approach should not be mixed with the distinguished study of Lynn et al. (2007) about
population segmentation according to health status. The population-based strategy is
typically selected in circumstances in which a specific reimbursement law concerns a
clearly defined population group, such as students, veterans or employees. This
strategy would be also appropriate if a population group has several diseases and
conditions that occur only or mostly in this group (e.g. children’s and women’s
hospitals for children’s and women’s diseases). However, the diseases and treatments
that occur in other population groups and are too rare to justify population-based
strategy should be delivered by organizations following other focus strategies,
e.g. based on illnesses or care processes. Although demographic groups determine the
incidence rate of certain illnesses, such as in gynaecology and obstetrics, the variety of
illnesses, urgencies and care practices is typically wide and leads to a high variety in
1. Population (Markets)
3. Illnesses and symptoms (Demand)
4. Care practices and processes (Supply)
Variety
2. Urgency and severity of illnesses and symptoms (Demand)
5. Care outcome (Outcome)
Risk not
yet
realized
Patient
gets ill /
Triage
Examinati
ons /
Diagnosis
Treatment Outcome Examples
Student clinic, Children
/ Military / Women
hospital
Trauma / Emergency
hospital, Appointment
clinic
Heart /Spine centre
Joint replacement /
Cataract surgery clinic
Rehabilitation centre,
Terminal care hospital,
Detoxification centre
= Point of Focus
Figure 1.
Five strategies to
utilize focus concept
in health care
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care outcomes. In population-focused organizations, high performance is typically
related to the understanding of the customer context and specialization in certain
population-specific conditions rather than producing standardized care procedures and
processes. Understanding the customer context also supports preventive services
before the risks of illnesses have been actualized.
In the second type of focus, demand variety is reduced by limiting arrival
characteristics. Organizations focus on particular urgency or severity categories, such as
urgent walk-in demand or scheduled elective cases. Although, from a clinical perspective,
the difference between acute and elective cases is somewhat irrelevant, serving both
groups with the same resources leads to problems in capacity utilization and waiting times.
Therefore, trauma centres and appointment-based clinics are usually organized separately
to focus on patients with different urgency profiles. Trauma and emergency hospitals are
suitable delivery units if regional demand for urgent care is enough to establish a unit with
24/7 readiness for a variety of urgent cases. If demand is insufficient, a better strategy
would be to establish an emergency department inside a hospital that would benefit from
sharing resources with non-urgent clinics. Non-urgent focus, on the other hand, is an
appropriate strategy for small scale specialist clinics, such as dental clinics or primary care
centres, in which customers prefer short distance and a prompt schedule over a round-the-
clock service. It should be also understood that urgency- and severity-based focus strategy
is a dual strategy: establishing an emergency hospital enables and even sets the
requirement to establish its complement –a unit focused on non-urgent cases.
In acute units, flow efficiency and rapid access to care is a priority, whereas elective
units strive to maximize resource efficiency and service precision. Focus on certain
urgencies enables simple targets for service levels and the avoidance of conflicting
rules of capacity use for different patients. However, maintaining high performance
might be problematic because patients have different illnesses that require a large
variety of specialists. In urgency- and severity-focused units, setup times in capacity
planning and scheduling tasks can be minimized, but variety in specialist work
processes might remain relatively high.
The third type of focus is the reduction of both demand and requisite variety by
focusing on limited number of illnesses and symptoms. The illnesses can be defined
based on body systems (neurology, ophthalmology, etc.) and/or principal causes
(infections, tumours, etc.). The more sophisticated the segmentation, the more attention
should be paid to diagnosing and selecting patients before accessing focused
operations. The selection phase can be integrated in the focused unit, or it can be
performed in another organization that is easily available to patients and has the
incentives and competence to make optimal decisions about follow-up treatment.
A health care organization should employ illness- and symptom-based focus
strategies if unique or considerable amounts of resources are needed to examine,
diagnose and treat patients with certain symptoms or illnesses. Heart and spine centres
are examples of units in which the volume of patients would justify integrating several
specialties, such as surgeons, internists and neurologists, to jointly examine and treat
only those specific diseases. Illness- and symptom-focused organizations specialize in
identifying optimal care procedures and treatment methods for selected patient groups
and providing those services at a high-quality level (Peltokorpi et al., 2011). Their care
options and processes still have remarkable variety, making the standardization and
utilization of scale effects problematic.
The fourth type of focus is the reduction of requisite variety by focusing on certain
procedures or care protocols, i.e. all patients that are assumed to need certain
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procedures are accepted. The strategy fits well in non-urgent conditions in which the
best treatment method is known, and customers are willing to select a provider in a
large region based on references and comparable performance indicators. Shouldice
Hernia Centre in Canada and Coxa Hospital for Joint Replacement in Finland are
examples of such strategies. Narrowing the range of procedures enables the
standardization of care pathways, improves medical quality through learning-by-doing
(Gaynor et al., 2005) and provides faster treatment. The procedure focus should not be
confused with functional focus in which the care pathway inside the hospital is divided
into different functionalities, such as outpatient visits, ward care and surgical
procedures, without a defined pathway connecting them.
Organizations belonging to the fifth type of focus are built around the target outcome
of the care. The strategy is most appropriate in circumstances in which there is no doubt
about the desired outcome but the process of how to proceed to achieve that outcome is
unclear. The strategy can also be used for marketing purposes to underline the primary
value offered to a customer instead of the excellence in processes or technologies used to
produce that value. For example, rehabilitation centres aim at fit-to-work patients,
terminal care at painless and peaceful passing and detoxification centres aim at the
sobriety of customers. Several services, resources and environmental features support
the achievement of these outcomes, and customization based on customer needs and
wants is crucial. These organizations are highly skiled in taking into account customer-
based factors and motivating and persuading customers to achieve the desired outcome.
From the management perspective, however, complexity might arise from the individual
combinations of customer starting points and needed services.
In summary, the five focus strategies are different approaches to managing variety
by amplifying, absorbing or reducing it. The core issue is at what point in care episodes
is variety narrowed. In the first focus type, variety is reduced by signalling in advance
that this hospital or unit is meant only for certain types of patients. In the second,
variety is reduced at arrival by triage where the level of urgency and severity is
assessed. In the third, variety is limited to certain types of illnesses or symptoms that
the unit is prepared to handle. In the fourth, the unit offers only certain procedures;
pre-selection is supposed to be done in earlier phases of the case. In the fifth type, the
focus is put on certain outcomes. Patients who are not committed to those outcomes are
directed to other services.
Practice implications: management of focus
The developed framework supports health care organizations to select whether or not
to focus and what focus strategy to choose in certain circumstances. The strategy
should be selected based on key performance indicators, e.g. cost-efficiency, outcomes,
access or throughput time. Therefore, performance management is crucial to consider
in each focus strategy, as the selected focus defines performance measures in which the
unit can expect to be especially good.
The performance advantages of focus are materialized only through appropriate
managerial practices that fit the selected approach. The two central dimensions are
demand management and supply management ( Jack and Powers, 2009; Lillrank et al.,
2010). Demand management means that a producer attempts to affect the ways in
which demand arises and then engages supply in terms of volume, time and demand
type. Supply management means that the producer attempts to structure and manage
its resources accordingly through specific service offerings and channels and
appropriate staffing and scheduling.
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The principal demand management methods are (a) pricing, i.e. price incentives that
shift demand from peak time to off-peak hours; (b) restricted service at peak times; (c)
specialist service channels based on demand segmentation and (d) advertising,
promotion, and customer communication to manage demand so that it fits with
available capacity ( Johnston and Clark, 2005). At the health care system level, the use
of gatekeeping methods (a-b) is limited, meaning that segmentation and customer
communication have an influential role. Some focus strategies, such as focus on certain
illnesses and symptoms (e.g. heart centres), prompt organizations to move towards
vertical integration, e.g. by insourcing the diagnostic, cure and rehabilitation phases
into one unit (the full service-line approach). There still is a need for coordinating the
flow of patient cases to and between focused units, especially in the very early phase of
the case. Therefore, the roles of segmentation and medical indication settings are
emphasized in demand management.
The principal issues concerning key performance indicators and critical success factors
in demand and supply management in each focus strategy are presented in Table I. The
table underlines the specific indicators and practices in each strategy by understanding
that some issues, such as high medical quality, are essential in all strategies.
Population-based focus strategy fits well with ambitions to improve the overall state
of health and wellness among the target population. Organization’s competitive
advantage is based on the capabilities and measures it uses to understand the
customers’side of the value creation. In its operations, a women’s hospital has to
consider the customer in a wider context, including her family and relatives. An
occupational health centre has the advantage of understanding its customers’working
conditions and relationships. A wide understanding of the customer context enables
prevention and predictive services. The role of the customer is to commit to a
relationship with the provider and to communicate his or her context-specific issues
during service events. From the supply management perspective, the population
Focus
strategy
Key performance
indicators
Critical success factors in demand
management
Critical success factors
in supply management
1. Population
approach
State of health and
wellness
Regular customer approach,
understanding customer contexts,
patient profiling and risk reduction
Organizing transfer
from first phase
generalists to
specialists
2. Urgency
and
severity
approach
Waiting time,
capacity utilization
Easy access, triage Organizing service
provision points and
delivery channels
3. Illnesses
and
symptoms
approach
Throughput time and
success rate in right
diagnosis and care
plan, effectiveness
Understanding symptoms and case-
specific customer context
Iteration and
modularity of
diagnostic and care
services
4. Care
practice
and process
approach
Throughput time,
cost-efficiency,
effectiveness
Indication setting, checklists Scheduling, capacity-
utilization
management
5. Care
outcome
approach
Success rate to achieve
desired outcome
Understanding and communicating
desired outcome
Iterative process,
modularity of care
services
Table I.
Key performance
indicators and
principal demand
and supply
management factors
in the five
focus strategies
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approach is problematic because a wide range of services and resources are needed to
provide cures and care for all kinds of illnesses. Therefore, it is essential to manage
the transfer from initial diagnosis to specialist care. Variety in medical conditions
and care practices also means that each illness or care process has to have its own
sublevel measures.
Urgency- and severity-based focus strategies benefit organizations that set short
waiting times or high-capacity-utilization rates as their key performance indicators.
The provider’s competitive advantage is based on the triage process and rapid access
to care. Service networks and delivery channels have to be built to meet these criteria.
This focus strategy is most suitable at the diagnosis phase, especially in non-acute
cases. In the cure phase, it might be reasonable to provide separate focused operations
that utilize the illnesses/symptoms, care practice/process or care/outcome approach.
The benefits of an illness- and symptom-based focus strategy relates to identifying
optimal care procedures and treatment methods for selected patient groups, typically in
an iterative and emergent process. Performance is measured based on throughput time
and success rate to arrive at a right diagnosis and care plan. The patient’s role is to
commit to the care plan and communicate changes in his or her symptoms and health
status in order to ease the finding of optimal care in his or her specific context. Variety
in care practices and processes can be partially managed by utilizing modular service
packages and by structuring focused sub-operations inside the organization.
In the care practice and process-based focus strategy, an organization’s competitive
advantage is based on cost-effectiveness and cost-efficiency, which are achieved through
standardization, the learning curve, capacity management and scheduling policies.
The role of the customer is limited to fit process requirements. Indication policies are
needed to check the suitability of the care for the patient’s specific needs. Fluent flow
through standardized processes is supported by checklists that are used to ensure that
both patient and personnel are prepared for the treatment.
The advantage of the outcome-based focus strategy is that it offers customers and
organizations clearly communicated value to which both can commit. Desired outcomes
of services are fixed, such as returning patients to work or home. Repeated
performance measures that focus on success levels are at the core of the service,
defining the rhythm and practices in individual care plans. The service elements have
to have versatility similar to that of its customers, including not only medical
capabilities but also social and welfare services.
Practice implications: coordination of focus
A shift from wide variety service units towards focused operations increases the need
for coordinating activities at the patient episode level. When a focus strategy is utilized
to organize different care practices and processes into dedicated production units, the
full vertical integration of care pathways is hard to constitute (Kreindler et al., 2012).
Focusing can lead to a fragmented delivery system in which patients face challenges
navigating between service providers, and inappropriate incentives for focused
providers cause sub-optimization. For example, a joint replacement clinic might favour
operative treatment in cases in which conservative treatment would be sufficient.
The needs for coordination in a system with focused units can be classified as:
(1) coordination activities when patient gets ill: who to contact in the first instance;
(2) ensuring optimal care decisions and treatment plans: referring patient to a
suitable focused provider;
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(3) coordination after focused units if the care pathway does not have full vertical
integration; and
(4) organizing treatment in cases in which focused units are not available.
The first coordination challenge is related to the patient selection and navigation
phenomena. When a patient gets ill, he or she has a limited number of potential
providers to contact in the first instance. Decisions about who to contact first need to be
easy to make based on available information and instructions. The second challenge is
to ensure that care decisions about treatment after examinations are made optimally
from the patient and whole system perspective. It should be ensured that provider
incentives do not effect the care decision and that the treatment plan is undertaken as
professionally and objectively as possible.
The third coordination task includes situations in which the focused unit covers
only part of the whole care episode and the patient is moved to another provider when
certain conditions are fulfiled. This is possible in acute cases in which an emergency
hospital takes care of the acute period of care, and when the status is stabilized the
patient is moved to rehabilitation, e.g. home or to a focused rehabilitation unit.
Although it might be appropriate to fragment the care pathway to different production
units, clinical coordination across units is needed to maximize the value of services
delivered (Shortell et al., 1996).
When the care of high-volume cases is organized through focused operations,
whether the strategy follows market, demand, supply or outcome logic, there are
always complex or low-volume cases whose care is hard to organize in a focused
environment. The fourth challenge is related to the system-level coordination needed to
ensure that skiled resources are available for those cases.
The needs essential to coordination and the solutions suggested to tackle those
challenges vary between the focus strategies (Table II). Coordination challenges are
typically minor in population-based focused units, which use simple non-clinical rules
in demand segmentation and try to provide all essential care for their customer
segment. As described in the previous chapter, coordination challenges arise in the
intra-organizational management of different diseases and treatments. In the urgency
and severity approach, coordination is needed especially when referring a patient to
follow-up treatment. Integrated health records and standardized handover practices in
service interfaces can enable a smooth care pathway. The role of the independent
gatekeeper is emphasized before care practice and process-based focused units in order
to avoid misaligned incentives and sub-optimization in care decisions. Web-based
decision-making tools, telemedicine or conventional general practitioners can be used
when directing a patient to an appropriate illness and symptoms-based focused unit
(e.g. Christensen et al., 2009). Customer-oriented solutions (e.g. case managers) are
needed to coordinate access to outcome-based focused units. In spite of patient-level
coordination activities, rare illnesses and treatments might not be treated in highly
focused units. Regional or national coordination is required to ensure capabilities and
resources for those cases, e.g. in university or general hospitals.
In summary, focusing health care operations leads inevitably to increased
coordination challenges and transaction costs between service providers. Focusing too
narrowly might be counterproductive, as it decreases the benefits achieved from
volume and increases coordination costs in a fragmented service network. Therefore,
health care authorities and managers need to comprehend the suitable level of focus
and understand solutions to tackle coordination challenges arising from different
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focus strategies. As financing models and regulations differ between health care
systems, universal coordination challenges and solutions are impossible to define.
However, ensuring efficient patient flow and avoiding sub-optimization among
providers are general needs that each system with focused units encounter.
Discussion and conclusions
The initial motivation for this study originated from unclear definitions of focus in
health care research. The confusion around specialty and discipline approaches using
focus concepts differs remarkably from Skinner’s (1974) original idea of market and
product-based approaches in which the role of professions and specialties is reduced.
Following the original idea of focus and its mechanisms, we have presented a model
to define focus and have identified five focus strategies, their advantages and
challenges. The categorization of focus according to population, urgency and severity,
illnesses and symptoms, care practices and care outcomes yielded a set of approaches
aimed at clarifying the focus concepts and their instantiation in health care operations.
The strategies are sequentially connected to the progress of typical care pathways,
from healthy population to emergence of illness, treatment phases and outcomes, and
highlights customer-orientation as a pervasive logic and interconnections between
different care phases to reduce and manage variety.
In order to choose a suitable focus strategy, it is essential for health care
organizations to understand how focus mechanisms and competitive advantages differ
between approaches and to understand in which circumstances the different strategies
are appropriate. The choice of the strategy should be affected not only by internal
Focus strategy Coordination needs Possible solutions
1. Population
approach
Referring patient to other unit when
specific care cannot be delivered in
population-based focused unit
In general, coordination challenges
are minor
Integrated health records with the
following units
2. Urgency and
severity
approach
Prioritizing acute needs among
unclassified demand
Referring patient from an acute unit
to rehabilitation when patient status
is stabilized
Referring patient after outpatient clinic
examinations to a care practice-based
focused treatment unit
Centralized direction of urgency cases
Integrated health records with the
following units; standardized handovers
in care interface
Independent gatekeeper
3. Illnesses and
symptoms
approach
Directing patient to appropriate focused
unit based on his/her symptoms or
medical condition
Organizing care for rare illnesses
GPs, family practitioners or primary care
doctors as gatekeepers; web-based
decision-making software; telemedicine
Full range hospitals (e.g. university
hospitals)
4. Care practice
and process
approach
Directing patient to appropriate focused
unit based on his/her diagnosis and
treatment plan
Organizing uncommon and rare
treatments
Integrated health records with the
previous units; independent specialist
gatekeeper
Full range hospitals (e.g. university
hospitals)
5. Care outcome
approach
Directing patient to appropriate focused
unit based on a desired care outcome
Customer-oriented treatment planning;
service integrators; case managers
Table II.
Essential
coordination needs
and possible
solutions followed
from the different
focus strategies
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processes but also by external conditions, such as regional demand, reimbursement
laws, competitor strategies and changes in all those. The performance advantages of
focus are achieved only through demand, supply and performance management
practices ( Jack and Powers, 2009) that fit the selected strategy. A focus strategy creates
the demand conditions to which such practices can be applied. Focus is a necessary but
not a sufficient condition of performance improvement. Focused units are also part
of the larger health system, meaning that there is a need to coordinate patient episodes
in the network of focused and non-focused units and that the performance of focused
units has to be subordinated to the overall performance of the health system.
The conceptual nature of the study calls for future research and empirical
investigations around focus strategies in health care. The conceptual model appears
logical, but the question remains: how well could it be used to empirically classify units
according to their focus strategy. Previous research about patient-oriented focus
concentrated on strategies around medical conditions and care processes (Hyer et al., 2009;
Bredenhoff et al.,2010).Therefore,moreresearchisneededonpopulation-andoutcome-
based focus strategies, on how those strategies that aim at understanding the customer
context (population approach) or underline the target value of service (outcome approach)
are framed and on how these compare with other focus and non-focused strategies.
Comparisons between focused and general units should be framed by what type of
focus strategy is applied. When the focus strategy type has been established, the next
question should be how it is implemented in terms of demand, supply and performance
management. Future research should investigate how different focus strategies enable
the use of operations management mechanisms related to quality, throughput time and
productivity. A measure of the implementation intensity or completeness could be
developed and appropriate benchmarks could be established. Thereafter, comparisons
between units applying the same focus strategy but at different levels of
implementation intensity could be made.
A further issue to be investigated is the role of focused units in a regional health care
system. There is a need to coordinate patient episodes in a network of focused and
non-focused units. More knowledge is needed about system-level effects of focused
units, especially in competition, coordination of care pathways and transaction costs.
From the system development perspective, focus strategies and their possible
implications for service delivery and systemic innovations could be investigated.
Dynamic and complex phenomena, such as supply-induced demand and the care of
comorbidity patients, should also be considered.
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About the authors
Dr Antti Peltokorpi is an Assistant Professor at the Department of Civil and Structural
Engineering, Aalto University. Peltokorpi holds a PhD in Operations Management from the Aalto
University School of Science. Peltokorpi’s research interests include service innovations, service
production strategies and production planning and control especially in health care and
construction industry. He has been also active in research about value creation in business
networks and supply-chains. Dr Antti Peltokorpi is the corresponding author and can be
contacted at: antti.peltokorpi@aalto.fi
Dr Miika Linna’s (Aalto University) research include productivity and efficiency in health
care, register-based analysis of cost-effectiveness and outcomes and health care financing.
He pioneered the development of the national-level information system for hospital DRG episode
benchmarking. He was also one of the key developers in the national system of indicators for
disease-based cost-effectiveness and quality and in the Nordic Hospital Productivity Comparison
Group. Dr Linna has several publications in health economics, health services research, health
care management and medicine.
Tomi Malmström, MSc, a Researcher and the Head of the Institute of Healthcare Engineering,
Management and Architecture (HEMA) at the Aalto University. He is currently finalizing his PhD
in Healthcare Operations Management and has been a Visiting Researcher at several universities
(e.g. Tokyo Institute of Technology, Erasmus University Rotterdam). His research is focused on
health care demand management, production planning and control as well as on regional service
production systems.
Dr Paulus Torkki is a Post-Doctoral Researcher at the Aalto University, Department of
Industrial Management. Torkki holds a PhD in Operations Management from the Aalto
University School of Science. Torkki’s research interests include health care operations
management, especially in the area benchmarking, patient flows and productivity. Torkki has
also served as a Business Director in the Nordic Healthcare Group and Datawell Group.
Dr Paul Martin Lillrank is a Professor at the Aalto University School of Science, Department
of Industrial Engineering and Management. Lillrank holds a PhD in Sociology from the Helsinki
University. His research areas are healthcare operations management and quality management.
He has also been active in research about frugal innovations.
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