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According to Naidu & Narayana 1991, “Toward the end of the twentieth century hospitals were presented with many challenges for increasing profitability, customer loyalty, quality of care, and market dominance. The marketing function, new to hospitals in the mid-1980s, was seen as a way to attract new customers, develop new services, and communicate "value" to potential buyers of its services. Adoption of a marketing orientation by hospitals was a necessary management strategy to achieve a competitive advantage in local markets.” Marketing has been effective and hospitals that have invested in their marketing have seen an increase in customer base than their rivals in a given geographic location (Abdul-Gader & Bhuian 1997).
In studies that have sought to establish the correlation between marketing orientation of hospitals and their general organizational performance, it has been discovered that marketing to a great extent contributes to the hospitals performance. “Defining marketing orientation in terms of market intelligence activities interfunctional coordination, and organizational responsiveness activities, , McDermott, Franzak, & Little, 1993 found that the adoption of a marketing orientation by hospitals is positively associated with financial performance.”
In their 1997 study, Abdul-Gader & Bhuian found that, “different dimensions of market orientation are associated with specific measures of performance and that responsiveness to customers and to the competition are most closely linked with financial performance of hospitals. Marketing orientation is much higher among those hospitals that have strong affiliations with other providers.” This goes to show that multi-hospitals systems in marketing of healthcare are indeed effective.
Looking at the issue of accountability in multi-hospital marketing indeed hospitals that come together for this purpose have mutual benefits. Thompson & Hurley 1993 concluded that, “While intuitively appealing to many healthcare executives, the adoption of marketing by hospitals during the last two decades of the twentieth century was highly variable. The inconsistency in the adoption of marketing was a result of a number of factors, namely the perceived lack of relevance to hospitals operating in highly regulated, yet revenue-rich, environments of the 1970s and early 1980s.As these environments became more competitive and resource-limited following the implementation of Medicare's prospective payment system, marketing was vigorously advocated as a means for hospitals to achieve organizational objectives and a competitive advantage.”
In conclusion therefore, marketing is not only appropriate but also vital in hospitals marketing. The last bit of the last century brought hospitals under the management of executives who understood that marketing and an environment of competition would only go a long way in improving health care delivery. In the packaging of the services available in hospitals and the building of a client base, hospitals are able to invest and innovation becomes a major part of their operations. And hospitals in order to do better than their rivals i a particular location will strive to provide better services.
Also, marketing has proved to be quite effective in the hospitals that have undertaken it. Several studies have made the conclusion that there is a correlation between effective marketing and revenue from operations in hospitals. Effective marketing has raised the client base in hospitals and created a sort of client loyalty to products hence they came back for more services and as a result provided more business for their chosen hospital of choice.
Just like marketing in any other business sector or industry, accountability in the marketing activities of hospitals has had to be evaluated. The goal of any marketing undertaking is to increase sales and the money invested in marketing should increase sales as expected. The executives have to justify the money they spend in marketing to the hospitals as this budgeted money must show value. Where their marketing strategies do not seem to show the desired effect, a change of strategy is called for as competition ever continues top stiffen.
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