Considering Key Stakeholders in Hospital Management
Purpose: The complexities of American Healthcare and its free-market business model makes hospital management a very dynamic and stressful undertaking. I continue to be fascinated by all that I am learning and look forward to my evolution as a leader in my field and my community. These are my insights on hospital stakeholder management and engagement
Considering Key Stakeholders in Hospital Management
Published on July 19, 2020 by me on the LinkedIn Platform
In the last decade, we have heard a lot about the business of healthcare, especially in America with its capitalistic healthcare model. Studying healthcare administration while working in a hospital has opened my eyes to the balancing act of community/ public health and business. Healthcare is one of the most dynamic industries in the world. Strict and ever-changing legal and political regulation, in addition to complicated reimbursement policies, and varying organizational models makes healthcare a complicated business to master. In the management of hospital operations, community and public health must also be considered. Business success cannot be at the forefront of hospital priorities as the quality of care and positive health outcomes are paramount to hospital success. According to Austen (2012), increased competition in hospitals, poor economic situation, and frequent changes in the sector imposes the necessity for regular strategic planning and process improvement. These processes are most successful by working with key hospital stakeholders to continue to build and tailor a hospital to fit the needs of the community, thus remaining successful and indispensable. This article will identify key hospital stakeholders and evaluate strategies used to develop relationships with these stakeholders in order to maintain constructive communication and strategic business operations.
Any successful business requires collaboration and alliances between various actors with clear stakes in the work and operations within the business, such is the role stakeholders (Auvinen, 2017). In healthcare, stakeholders can be patients, caregivers, providers, organizations, researchers, policymakers, or anyone who has a vested interest in a clinical decision or healthcare service (DHHS, 2018). The dynamic nature of a hospital indicates the need for collaboration between various stakeholders in strategic management. Fottler et al (1989) indicate that hospital stakeholders can be categorized into three groups- internal, interface, and external stakeholders, which we will define below.
Internal: Operate entirely within the bounds of the organization, typically management, professional and nonprofessional staff.
Interface: Function both internally and externally, typically medical staff, hospital board of trustees, corporate office/ parent company, stockholders, taxpayers, other contributors. These tend to be the most powerful stakeholders.
External: Can be further divided into 3 categories according to their relationship with the hospital:
Provide input: Suppliers, patients, payers, financial community. Symbiotic relationship (hospital depends on these stakeholders to stay in business, the stakeholders depend on the hospital for service or to take their output)
Competitive: Seek to attract the organization’s dependents, being staff or patients. Do not depend on each other to survive.
Special interest: Concerned with the impact of the hospital's operations relative to their interests, like government regulatory bodies, accrediting associations, professional associations, labor unions, media, local community, political action groups. If a conflict arises, compromise rather than collaboration is usually the solution with these groups.
Communication with each of these groups is different. Each group also has its own relative importance to hospital management. This is where stakeholder analysis and management come in.
Stakeholder Analysis, Management, & Engagement
In hospital management, stakeholder analysis, management, and engagement are key. However, it is impossible to reach all stakeholders, consider their opinions, and keep them happy at all times. Therefore, stakeholder analysis and management are important parts of strategic hospital management. In stakeholder analysis, the aim is to determine the relevance of the stakeholder's perspective to the project or policy by identifying important stakeholders, assessing or mapping stakeholders as primary or secondary, and lastly assess the views of the stakeholders based on relative importance to the project or policy (Auvinen, 2017). In the classification of stakeholders, the primary stakeholder groups are those stakeholders that are necessary for the survival of the hospital; the secondary stakeholder groups may influence the hospital but are not essential to hospital business (Auvinen, 2017). In assessing a stakeholder's importance, this step is relative to the project. Some may consider the power of the stakeholder within the hospital, others may consider the legitimacy of their knowledge of the project or the urgency of the task at hand. These steps allow hospital management to identify key stakeholders, which leads to the next task- stakeholder engagement.
Once key stakeholders are identified, clear and up-front communication is vital to maintaining a trusting relationship with honest and constructive feedback. Leadership needs to properly manage stakeholder expectations in order to maintain engagement. According to Jahangirian et al (2015), lack of communication with stakeholder groups is the top factor contributing to poor stakeholder engagement, followed by poor management support, unrealistic workload expectations, and failure to produce quick or tangible results. When interacting with stakeholders, it is always important to remember who your audience is and what your message is (DHHS, 2014). The message and expectations for various stakeholders should be tailored appropriately to maintain engagement. Clear, concise, and vivid examples should be presented. Expectations for stakeholder actions should be clearly communicated, and follow-up should always be initiated by hospital leadership to ensure that stakeholders are satisfied and remain engaged.
Due to the dynamic nature of healthcare and hospital management, stakeholder engagement is an important part of business operations and strategic management. Once key stakeholders are identified, their relative importance to the task at hand should be determined, and the specific stakeholder or stakeholder group should be analyzed for effective communication and continued engagement reasons. Success in stakeholder management and engagement should be constantly evaluated and operations adjusted. According to Fottler et al (1989), “managers should recognize, who matters? and why do they matter? and [recognize] that these hierarchies may vary in different organizations and settings.” When hospital management and stakeholders work together cohesively, a hospital can not only thrive in business but provide high-quality care and improve community health throughout the life of its business operations.
Austen, A. (2012). Stakeholders in management in public hospitals in the context of resources. Management, 16(2). DOI: https://doi.org/10.2478/v10286-012-0067-8.
Auvinen, A. (2017). Understanding the Stakeholders as a Success Factor for Effective Occupational Health Care. Occupational Health. DOI: 10.5772/66479. Retrieved from: https://www.intechopen.com/books/occupational-health/understanding-the-stakeholders-as-a-success-factor-for-effective-occupational-health-care
Fottler, M. Blair, J. Whitehead, C. Laus, M. Savage, G. (1989). Assessing key stakeholders: Who matters to hospitals and why? Hospital & Health Services Administration, 34(4), pp 525- 546.
Jahangirian, M., Taylor, S. J. E., Eatock, J., Stergioulas, L. K., & Taylor, P. M. (2015). Causal study of low stakeholder engagement in healthcare simulation projects. The Journal of the Operational Research Society, 66(3), 369-379. DOI: http://dx.doi.org/10.1057/jors.2014.1
US Department of Health and Human Services (DHHS). (2014). Designing and Implementing Medicaid Disease and Care Management Programs. Section 2: Engaging Stakeholders in a Care Management Program. Agency for Research and Quality. Retrieved from: https://www.ahrq.gov/patient-safety/settings/long-term-care/resource/hcbs/medicaidmgmt/mm2.html
US Department of Health and Human Services (DHHS). (2018). The Effective Health Care Program Stakeholder Guide. Agency for Research and Quality. Retrieved from: https://archive.ahrq.gov/research/findings/evidence-based-reports/stakeholderguide/chapter3.html
