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Hospital management by product lines
1Department of Health Economics, University of Limburg, The Netherlands.
Health Services Management Research
|February 8, 1991
Summary
Product-line management offers hospitals a novel approach to internal control, distinct from budgeting. This strategy involves defining product lines and optimizing organizational structure and cost systems for improved economic performance.
Area of Science:
- Healthcare Management
- Health Economics
- Organizational Studies
Background:
- Healthcare organizations face reforms in reimbursement systems to enhance economic performance.
- These reforms necessitate internal management control strategies.
- Budgeting is a common tool, but product-line management is less recognized in Europe.
Purpose of the Study:
- To introduce the concept of product-line management in European hospitals.
- To explore the definition and implementation elements of product lines within hospitals.
- To analyze the impact on organizational structure and cost information systems.
Main Methods:
- Conceptual introduction of product-line management.
- Discussion of product line definition in a hospital context.
- Analysis of implementation factors, organizational structure, and cost information systems.
Main Results:
- Product-line management provides a framework for internal control.
- Implementation requires defining product lines and adapting organizational structures.
- Cost information systems need to align with product-line structures.
Conclusions:
- Product-line management is a valuable, though less known, management tool for hospitals.
- Its adoption can lead to improved economic performance.
- Consideration of advantages and disadvantages is crucial for successful implementation.