Hospital strategy and logistics: separate worlds?

Besides looking at logistical parameters I also did a scoping review on hospital strategy and logistics. I was wondering to what extent logistical parameters play a role in making hospital strategies. From personal work experience I did not expect a strong link between hospital strategy and logistics, given the observations I mentioned earlier. But, I was hopeful that my lack of experience with boards was one of the reasons I had not seen it. There must be some sensible idea behind hospital strategy, at least that was my hope.

I searched the international literature on the same keywords as before (see my blog on the logistical parameters) and added the words ‘Strategy’ and ‘Strategic’. This resulted in 129 articles with strategic hospital topics mentioning logistics in some way. Half of these articles actually mentioned logistical parameters. There were articles on quality improvement, access to healthcare and how to use scarce resources, but hardly any article was on how logistics could strengthen the quality of care or competitiveness of hospitals. There were no articles on mergers or how good building or organization design supports strategic goals. There were some articles on the theoretic link between logistics and strategy, for example on lean or business process reengineering.

Surprisingly enough more than half of the articles (39) did not consider the entire hospital, but a subsystem of it, such as Emergency care or patients requiring surgery. I wasn’t sure these articles were even strategic at all. Using the word ‘strategic’ does not make the approach of an issue necessarily strategic.

If logistics and hospital strategy are not interrelated in literature, what does this mean? Is it considered irrelevant? Is it impossible? Are strategies made regardless of how hospitals work in practice?  Are strategy makers purely interacting with the outside world, legitimizing their existence rather than making it indispensible by outstanding performance? What is hospital strategy about and does it have any impact? How are we going to control health care costs when no one includes logistics into their strategy? This raises more questions than I can possibly answer.

I was struck by these results although it fitted in my own impression of hospital strategy in practice. But I hoped it was not true. I started to think about explanations.

Given the fact that hospitals have perhaps become too complex to handle, lack of a central logistics strategy could be a way to survive as board. If everyone in the organization organizes himself this could be very effective. Perhaps expensive, but it could work.

Another factor could be that the hospital’s environment is so dynamic that it takes all the time of boards to adapt to all developments. Maybe it is their job to keep the dynamics of the outside world away from the doctors so they can do their job. Maybe the ability to adapt is more important than operational efficiency. In my talks to boards of directors this last thing was certainly one of their remarks. One did not always believe in the theoretical advantages of mergers, but they stated that mergers were more or less enforced by external developments, such as legislation, less budget or mergers in the insurance company sector. One board member explicity stated that hospital strategy was not about efficiency but about surviving and adapting and making sure that the quality of care remained guaranteed. Hospital strategy would then be like renovating the operating rooms and keeping these fully productive at the same time, as is common for hospitals.

Survival of the fittest (the most adapted) is of course a very strategic goal. If this, at any cost is the task of a hospital board, then the main issue would be how we can  adapt the hospital in such a way that the logistical system remains intact or even improves? How do we keep this continous adaptation affordable? And if we adapt without taking into account the logistical system, how do we transform without accidently breaking it down? This is where understanding of the logistical hospital system comes into play. That is my next step: to find out how the logistical system of a hospital functions in practice.

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