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Focusing And Integrating: Supply Chain Integration In
Types of Focused Factories Within Healthcare
Organizations
Master’s thesis, MSc, Supply Chain Management
Faculty of Economics and Business, University of GroningenAugust 18th, 2016
Student name: Yang Li
Student number: S2876639
Email: y.li.56@student.rug.nl
Supervisor: Dr. Ing. J. Drupsteen Co-assessor: Prof. Dr. Ir. Kees Ahaus
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Acknowledgment:
This acknowledgment here is to show my great appreciation to people who provide me with much help during the process of this research.
First and foremost, I would like to thank my supervisor Dr. Justin Drupsteen for his valuable insights, patience, and supports. I also would like to thank my second assessor Prof. Kees Ahaus for his feedback to improve my thesis.
I especially appreciate all my group members for their feedback and help of my study.
Furthermore, I also thank the participants, especially the interviewees, for their cooperation and kindness to assist my group members and me in completing this research.
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Abstract
The insights about both focusing and integrating regarding healthcare organizations are discussed by many researchers. Focusing is aiming at separating a part of operation tasks while integrating refers to collaborating and gathering tasks together within an organization. In this way, it seems that focusing and integrating are two opposite aspects. This research paid attention to how do different types of focused factories integrate their supply chains in
healthcare organizations. A ten focused factories multi-case study is introduced to develop this research. The main findings of this study are that process-focused factories achieve the highest degree of supply chain integration by applying several practices within and among the organizations.
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Table of content
1. Introduction ... 5
2. Theoretical background ... 7
2.1 Focused factories ... 7
2.2 Focused factories under healthcare setting ... 7
2.3 Supply chain integration ... 9
2.4 Supply chain integration under healthcare setting ... 10
2.5 Connecting focused factories to supply chain integration ... 11
3. Methodology ... 13
3.1 Case selection ... 13
3.2 Data sources ... 14
3.3 Data analysis ... 15
4. Result ... 17
4.1 Within- case analysis ... 17
4.2 Cross-case analysis ... 22 4.2.1 Product-focused ... 22 4.2.2 Process-focused ... 23 4.2.3 Product-process-focused ... 24 5. Discussion ... 26 6. Conclusion ... 28 References ... 29
Appendix A Open questions ... 32
Appendix B Questionnaire ... 34
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1. Introduction
To increase service efficiency and reduce costs, healthcare managers struggle to introduce focusing and integrating as two seemingly opposing methods in healthcare organizations. Focusing is associated with separating a part of an organization’s operations by reducing complexity and concentrating on making less quantity of operations better. Healthcare focused factories can be divided into different types: product-focused, process-focused, and product-process-focused. Hyer, Wemmerlöv, and Morris (2009) indicate that focusing is indeed beneficial for the internal collaboration of organizations, but seemingly, it lacks integration with parties in the external environment. In this way, supply chain integration, which aims at cooperating and gathering tasks together to achieve effectiveness, can join with focused factories to enhance efficiency in a healthcare context. Can focusing and integrating co-exist? Consequently, how healthcare organizations focus their own operations while integrating with other parties is an interesting problem to be explored. The main aim of this research is to analyze ways of integrating supply chains in different types of focused factories among healthcare organizations.
Hyer et al., (2009) state that “focus” in healthcare is closely associated with patient
aggregation—by grouping patients with similar needs. Therefore, enhanced efficiency can be achieved due to the concentration on specific treatments or diseases instead of the broader range of general hospitals. Different types of focused factories are distinguished in the
healthcare system (Bredenhoff, Van Lent& Van Harten,2010). Product-focused factories limit treatment to a particular specialty and select their patients based on their specialty while process-focused factories are supposed to concentrate on processes via standardization and adjusting layouts, therefore, opposing the product-focused type, which aims at treatments. Besides, product-process-focused factories combine these two categories and pay attention to both specific procedures and patient groups. However, it seems that focused factories are lacking some integrations with supply chain members from external parties (Hyer et al., 2009). In this way, supply chain integration is put forward.
The essence of integration is that organizational components should constitute a unified whole (Barki & Pinsonneault, 2005). In the manufacturing industry, different degrees of supply chain integration show operational improvements. A higher degree of supply chain integration leads to better performance (Frohlich & Westbrook, 2001). This opinion is also found in healthcare systems (Wan, Lin & Ma, 2002). In the context of healthcare, the implementation of supply chain integration is frequently addressed as being a critical strategy in order to decrease resource utilization and improve healthcare quality (De Vries & Huijsman, 2011). Different degrees of integration are reflected in various integrative practices and
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So far, related works of literature pay most attention to focused factories and supply chain integration in healthcare settings (Hyer et al., 2009; Bredenhoff et al., 2010; Drupsteen, van der Vaart and Pieter van Donk, 2013). However, little is known regarding the combined thinking about how different types of focused factories integrate into their supply chain within healthcare organizations. These two areas have, traditionally, been treated as separate research tracks, but with the ongoing development of the healthcare industry, there is a need to
combine these two opinions to bridge this gap. This need is also in line with the general thrust of this study. The expectation of this study is to gain insights about the actual situations of supply chain integration in focused factories under the context of healthcare in the
Netherlands. To be specific, the relevance of the degree of supply chain integration and types of focused factories are shown in this research. The research question is the following:
How do different types of focused factories integrate into their supply chains?
To make the research question more concrete, some sub-questions will be answered as well:
1. What practices are conducted for supply chain integration in the three types of focused factories?
2. What are the differences and similarities in integrating the supply chains of these three types of focused factories?
A multi-case study methodology is used to answer the central question in this paper. Both within-case analysis and cross-case analysis are applied to illustrate the main findings. This article is proposed as one of the first scopes which look at the relations of focused factories and supply chain integration within the Dutch healthcare area. It tends to fill the literature gap between supply chain integration and types of focused factories. As for the practical
contribution, this paper can serve as guidance for healthcare focused factory stakeholders to gain clear insights regarding their need for integration and their actual situation of supply chain integration. This opinion is also supposed to put forward some tactical suggestions for organization managers.
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2. Theoretical background
To consider both supply chain integrations and types of focused factories in a healthcare system seems to be a new trend currently. In this theoretical part, an overview of relevant concepts and constructs concerning types of focused factories, supply chain integration, and their relations are given to support the research question.
2.1 Focused factories
The term focused factory is first coined by Skinner (1974).The focused factory in
manufacturing is indicated as: "a plant established to focus the entire manufacturing system on a limited, concise, manageable set of products, technologies, volumes, and markets precisely defined by the company's strategy, its technology, and its economics" (Skinner 1974; Skinner, 1985). The core of the focused factory concept is also revealed: limiting oneself to a concise, manageable set of tasks. Other researchers indicate the idea of a focused factory and its relevance as well. Pesch & Schroeder (1996) give the definition of focus as following: it is based on the highly intuitive notion that a plant can achieve performance by concentrating its resources on accomplishing one task, rather than attempting to address an endless series of demands from internal or external sources. This opinion suggests the essence of focus, which is in turn in line with what has been discussed by Skinner. From a historical point of view, the theory about “focused factory” has already been on the stage with the development of industry, particularly, manufacturing. It is said that the concept of a focused factory has been successfully applied in manufacturing for decades (Peltokorpi, Torkki, & Lillrank (2011). The conclusion can be drawn from the statement that manufacturing industries who adopted “focus factory” can benefit from it. Given this benefits, other industries, such as healthcare system, start to develop focused factories as well.
2.2 Focused factories under healthcare setting
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by Chukmaitov et al. (2008). Orthopedic departments, eye-care centers are accounted as examples of this type of focused factories. Process-focused factories are aiming at ensuring the efficiency of delivery and decreasing the lead time of treatments. This kind of
organizations always advocates low-complex, low-risk elective surgical procedures offered by multiple specialties. It involves a relatively higher product variety than other two types since they need incorporate with external parties in the care chain. In other words, this sort of focused factories suggests a high level of uncertainty within the supply chain. Also, the quality of service delivery of the process is the key point within this kind of treatment. Therefore it is also called delivery based type in which flexibility of the service delivery should be taken into account. All centers for low-complex elective surgery are examples of this type of focused factories. A different kind of focused factory is named product-process-focused (procedure based), this type is the combination of the former two. It is argued that these organizations treat a single, specific, group of patients and meanwhile offered one single treatment or a single surgical procedure. Examples of this type of focused factories can be regarded as the chemotherapy day units, centers for cataract care and the knee implants (join-care) units.
Insights regarding configurations of focused factories in healthcare setting are also indicated by other researchers. Three configurations of focused factories are related to the degree of
focus. It is argued by Cullen, Hall&Golosinskiy, (2009) that Ambulatory surgery centers
(ASCs) concentrate on specific treatments and offer surgical and nonsurgical services which do not call for an overnight stay in terms of ambulatory basis. Another configuration of focused factories called focused hospital unit (FHU) which focuses on multiple and consecutive care steps on a population of patients who share similar care needs (Hyer et al.,2009). Meanwhile, from organizational perspectives, FHU is an administrative unit within a larger organization, aiming at aligning resources, making planning and control points for performance and improvement. The third configuration of focused factories is called a
specialty hospital due to a concentration on a concrete disease. Therefore this kind of focused factories can offer their own patients more efficient and specialized treatments (Barro,
Huckman& Kessler, 2006).
In this paper, attentions are mainly paid to three types of focused factories (product-focused, process-focused and product-process-focused) and their situation regarding supply chain integration.
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focused factories are open for integrating their supply chain. Relevant research is carried out among these points in the healthcare system.
2.3 Supply chain integration
Supply chain integration in different industries has been discussed for many years. However there is a lack of a one-fits-all concept of supply chain integration (Stevens, 1989; Frolich &
Westbrook, 2001; Flynn, Huo& Zhao, 2010). In this research, we choose the definition which
has been indicated by Flynn et al. (2010), as its meaning is suitable with the research direction. The definition of supply chain integration is follows: the degree to which a manufacturer strategically collaborates with its supply chain partners and collaboratively manages intra- organizational and inter-organizational processes, in order to achieve effective and efficient flows of products and services, information, money, and decisions, to provide maximum value to the customer.”
Researchers put forward different perspectives regarding degrees of supply chain integration. Jaspers & van den Ende (2006) distinguish integration in the areas of coordination, tasks, ownership, and knowledge. Organization, physical flow, information flow, product
development, and planning and control are defined as five dimensions by Van Donk and Van der Vaart (2004). The span of integration is divided by Stevens (1989) into four incremental categories: no integration (baseline), functional integration, internal integration, and external integration. Based on the definition given by Flynn et al. (2010), supply chain integration can be sorted into two specific degrees: inter-organization (external integration) and
intra-organization (internal integration). In this research, we mainly focus on internal and external integration regarding healthcare supply chain. These antecedents and elements for degrees of supply chain integration can be justified by several integrative practices and manifestations. We talk about these opinions in the following:
As for external integration aspect, practices are the more strategic design integration which reaches across firm boundaries (Barki & Pinsonneault, 2005). This is further divided into two points of view: supplier integration and customer integration (Wong, Boon-Itt& Wong, 2011). Supplier integration includes strategic joint collaboration between a focal firm and its
suppliers in managing cross-firm business processes, including information sharing, strategic partnership, collaboration in planning, joint product development, and so forth (Ettlie & Reza, 1992; Lai, Wong& Cheng 2010; Ragatz, Handfield& Petersen, 2002). In the same way, customer integration involves strategic information sharing and collaboration between a focal firm and its clients which aim to improve visibility and enable joint planning (Hammond, Obermeyer& Raman, 1994). Moreover, customer integration allows a further understanding of market expectations and opportunities, which contributes to a more accurate and quicker response to customer needs and requirements (Swink, Narasimhan& Wang, 2007).
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integration in organizations was summarized by Pagell (2004) based on disparate literature: organizational structure, measurements and rewards, cross-functional teams, job rotation, top management support, information technology, and communication.
2.4 Supply chain integration under healthcare setting
Integrating supply chains in healthcare system has been taken into account by many
researchers. Within the healthcare sector, supply chain integration should be emphasized on processes associated with the flow of patients (De Vries et al., 2011). In this way, intensive coordination and integration between operational processes might lead to a better health supply chain performance. It is indicated that relevant practices can be applied regarding supply chain integration within healthcare system to the cooperation among various departments could be efficient and effective (Gehmlich, 2008). Moreover, the author also mentions that with the help of these practices, time lost for inefficient corporations among different parties in the care chain would minimized. Both practices regarding internal and external integration in the context of healthcare are talked about in the following:
Under healthcare context, it is indicated by Drupsteen et al., (2013) that internal supply chain integration regarding planning and control involved several mechanisms. Sharing of planning information which refers to that information is shared about when a patient is scheduled for a preceding process step, and this information is used by the planner of the subsequent process step to anticipate when the patient can be scheduled for this step. Sharing of waiting list information means that information is shared about how long it will take to schedule a patient for a preceding process step, and this information is used by the planner of the subsequent process step to anticipate when the patient can be scheduled for this step. Cross-departmental planning is stated as a department may schedule patients for a subsequent process step in a different department, allocating the capacity of the unit that will execute that action. Combined appointments mean that multiple measures in the care process are arranged and performed on the same day.
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multidisciplinary healthcare stakeholders, including healthcare practitioners (specialists, physicians, nurses therapists, etc.), administrators, policy makers, patients, care providers, support groups, and community-based healthcare workers. The objective of healthcare knowledge sharing is to collaborative problem-solving, to peer support to capacity building among different parties, making a robust collaboration and integration among organizations. In the work of Musson& Helmreich (2004), it is argued that sharing resources (e.g. operating rooms, specialized facilities, medical devices, etc.), expertise and specialists with external parties under healthcare context did not threaten organizations’ competitiveness. It will be helpful for organizations to achieve sustainable development. As a summary, Table 2.1 is shown as follows:
Table 2.1 Supply chain integration manifestation and practices
Internal integration practices External integration practices
General organizations
organizational structure, measurements and rewards, cross-functional teams, job rotation, top management support,
information technology and communication
Both to suppliers and customers: strategic joint collaboration, information sharing, strategic partnership collaboration in planning, joint product development,
market expectations and opportunities
Healthcare organizations
sharing of planning information, sharing of waiting list information, cross-departmental planning, combined appointments
application of IT system, healthcare knowledge sharing, sharing resources
Sources: Ettlie & Reza, (1992); Lai, Wong& Cheng (2010); Ragatz, Handfield& Petersen, (2002); Pagell (2004); Drupsteen et al., (2013);Raghupathi& Tan (2002);Abidi (2007);Musson& Helmreich (2004).
We found that all these practices are observed and applied in general industries and general healthcare organizations. However, there is a lack of justification about these integrative manifestations in the focused factories in Dutch healthcare system. Also, how healthcare focused factories apply these practices from general industries and general healthcare
organizations is still unknown. These gaps provide a new aspect to investigate. Consequently, these manifestations are selected from relevant literature and summarized into internal and external aspects, helping apparently to justify supply chain integration in focused factories.
2.5 Connecting focused factories to supply chain integration
In the work of Van der Vaart and Van Donk (2008), it is argued that business conditions play a crucial role in influencing supply chain integration. They state that higher degree of
integration can be expected in the supply chain if the business conditions are supposed to be low volume but high product variety. On the contrary, if business conditions are characterized as high volume but low product variety or uncertainty, lower degree of supply chain
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Linking to the topic of this research, under healthcare setting, the type of focused factories here can be regarded as healthcare organizations’ business conditions which have an impact on the supply chain integration. Given the review of relevant literature above, a conceptual model regarding research question of this study is formulated as follows:
Figure 2.1 Conceptual model
Based on the literature and the theoretical framework, this research mainly concentrates on the situation of supply chain integration in product, process, and product-process-focused factories. Disparate degrees and manifestations of supply chain integration are involved in different types of focused factories. Likewise, three types of focused factories perform diversely regarding supply chain integration. Moreover, we expect to acquire an
understanding of this research that compared with other two categories, process-focused factories which are consistent with high varieties and uncertainties concerning business conditions need and achieve a greater degree of supply chain integration, involving more various integrative practices and manifestations.
To be specific, in this research the following aspects will be explored: (1) the comparison among types of focused factories regarding both differences and similarities when integrating supply chain and (2) the specific situations and practical activities for each type of focused factory regarding supply chain integration.
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3. Methodology
The relation of different types of focused factories and supply chain integration is a new trend to be researched. According to Eisenhardt (1989), a case study which serves as an exploration method is suitable for this research to fill the literature gap. Furthermore, this study uses a multi-case study approach, which is reasonable because this can boost the external validity of the research (Voss, Tsikriktsis& Frohlich, 2002). Given the research question, it is more rational to answer it by collecting qualitative data to gain the insights, explore concrete answers and explanations, and bridge the literature gap (Yin, 2003). All information in this research is collected through several interviews with healthcare organizations in Dutch healthcare system. Besides, focused factories are the units of analysis in this study.
3.1 Case selection
The selected organizations, all in the Netherlands, are representing each different type of focused factories: products-focused, process-focused and product-process-focused. In this research, three examples of each type are being used, which means that there are 9 focused factories in total. Given characteristics and classification of types of focused factories, the preferable initial selected cases are three organizations under product- focused domain (e.g. orthopedic department, eye-care department, etc.), three companies under process-focused field (e.g. centers for wrinkle treatment or skin treatment, etc.) and three organizations under product-process-focused domain (e.g. the chemotherapy day units, or centers for cataract care). However, the practically selected outcomes depend on the realistic situation. While aiming for gaining a balanced case selection of each type, the actual research includes ten companies, with 4 belong to product-focused, 2 belong to process-focused, and 4 belong to product-process-focused (Table 3.1)
The number of the cases turn out to be a reasonable amount as it is in line with the work of Eisenhardt (1989) that an ideal case number in case study method is between four and ten. Besides, literal replication can be validated from the contrasts among each three cases within the same focus type. On the other hand, comparisons among cases from different types serve as a validity of theoretical replication. To guarantee the validity of the data, we choose all organizations as performing well both in care quality and in finance.
As a team, our six group members wholly contacted with 98 healthcare focused factories in the Netherlands by sending emails, telephoning or visiting to gain sufficient cases. Finally, we successfully collected data from ten companies.
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Table 3.1 Case classification regarding types of focused factories
Types Cases
Product-focused Case 3, 4, 6 and 9
Process-focused Case 5 and 8
Product-process-focused Case 1, 2, 7 and 10
To justify which type of focused factories a case belongs, we apply question 20 to 24 in the questionnaire (Appendix B) which are adapted from the protocol of Bredenhoff et al., (2010). Question 20 and 21 are related to the product-focused type while question 22, 23 and 24 are concerning about process-focused type. Each option has an accurate score: for question 20, 21, 22 and 23D, there are three options for each question, and option A indicates 4 points, option B means 2 points, option C states 0 points. While question 23A, 23B, 23C and 24 have five options under each question, options A to E represents 4,3,2,1 and 0 point, respectively. When counting scores regarding product-focused type, we sum the score of the question 20 and 21 and then divide this score by the maximum possible score of 8 points. Multiplying the results with 100, we calculate the resulting score as a percentage. As for counting score for process-focused type, we sum the score of the questions 22, 23 and 24, then divide this score by the maximum possible score(Question 23 has 23A, 23B, 23C and 23D four sub-questions. Thus the maximum score depends on each case. If a sub-question is not applicable to a case, then we use a “-” represents the score for this question). After that, we calculate the resulting score into a percentage.
Bredenhoff et al., (2010) claims that when a case’s scores are beyond 50% on both product-focused and process-product-focused, this case is sorted as a product-process-product-focused type. Indeed, several cases are found, whereby the scores of these focused factories are all beyond 50 % on both product-focused and process-focused types. Consequently, they are all categorized as product-process-focused factories. Thus, to provide a balanced and fair distribution of the types of focused factories, we decide to introduce “ratios” and set a reasonable range for the ratios. Here, we count the ratio as the score for product-focused divided by the score for process-focused (ratio=score for product-focused/score for process-focused). Then we get ten ratios for ten cases, according to the boundaries of these ten ratios, the range from 0.85 to 1.15 is applied. If the ratio is higher than 1.15, the type belongs to product-focused; If the ratio is lower than 0.85, then the type belongs to process focus; If the ratio is between 0.85 and 1.15, the type belongs to product-process-focused. Accurate score information is shown in
Appendix C.
3.2 Data sources
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As a team of six members, we work on both the open question interview (Appendix A) and questionnaire (Appendix B) together to gain sufficient data and provide a well-structured protocol for all of us. While we have a common theme regarding supply chain integration and healthcare focused factories, the respective direction and concentrations for each researcher is different. Consequently, a pool of protocol is applied to involve all of the relevant questions in it. Most of the open questions are introduced by group members with respects to their own research area and related literature. In order to create this protocol, six members sit together to brainstorm each detailed questions to justify if it is relevant to the topic or well worthy to ask. We gained 34 open questions including various aspects: descriptive of focused factories and supply chain integration, types and degree of focused factories, the degree of supply chain integration, integrative practices, barriers and service quality of focused factories. Above that, to enhance the validity, 36 questions are included in the questionnaire. Question 20 to 24 are referenced from Bredenhoff et al., (2010) to judge the types of focused factories. The rest questions (Q25 to Q36) in the questionnaire are conducted by our group based on each topic. This protocol is aiming to represent a large scale of the coverage regarding our research topics. The protocol is ambitious to gain understandings about the background of the healthcare focused factories and receive information about the supply chain integration. In this way, the protocol helps to carry out this research by justifying the types of focused factories and indicating their supply chain integration practices and manifestations.
In this study, one interview is carried our per case. Interviewees are all much more familiar with the operational process of the organizations and have knowledge in the areas regarding interview questions. There are some initial candidates: the person who has a managerial function; (e.g. managers of departments or units) the one who performs treatments (e.g. doctors or nurses).
We divided our six members into subgroups, ensuring that two members are always involved in one interview. The duration of interviews is approximately between 1 and 2 hours but also depend on the schedule of interviewees. During the interview, one member is responsible for inducing the informant regarding questions while the other one records the answers from the interviewee. All interviews are audio recorded to take a further analysis. Both an English and a Dutch version of the interview protocol are prepared in order to avoid misunderstanding of interviewees regarding questions. After the interviews, subgroups are responsible for
translating, transcribing and refining the collected data into a document to share with other members of the group.
3.3 Data analysis
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Table 3.2 Selected open questions to be investigated
Area Questions from interview protocol
Descriptive of focused factories(type of focused
factories)
3. What is the service offering of your organizational unit? 6. What type of patient groups does your organizational unit treat?
Descriptive of integration (the degree of supply chain
integration)
14. How patient flows and information flows are managed within your organizational unit, between departments, or between specialists? 15. Do you think your organizational unit requires both internal and external integration regarding patient and information flows? Can you explain why you think this?
16. With which external parties do you interact regarding patient flows and information flows?
17. How does the interaction with these external parties look like? Could you give examples?
19. What integrative practices are employed within your organizational unit? Could you give examples?
20. What integrative practices are employed with external parties? 21. What role does the IT system play within your organizational unit regarding supply chain integration and collaboration?
Relation focused factory type to integration(type of focused
factories and supply chain integration)
27. To what extent are specialists focused on a specific treatment or patient sub-group?
28. To what kind of focus type do you think your organizational unit belongs?
29. What physical assets are shared with other parties and departments? 30. Are specialists in contact with or employed by other hospitals? If so, in which way?
31. How does the planning in your organizational unit affect the planning of other organizational units or external parties and vice versa?
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4.Result
Table 4.1 shows the basic information including interviewees, service offering in each case and the number of specialists and patients annually in reality. Findings can be seen from the table that the respondents of ten cases are different, for example, respondent of case 8 is a financial director while that of case 1 is an operational director. We can also find that the scale of the organizations is not the same. This point can be seen from the number of treatment patients annually, ranging from 250 to 40000.
Table 4.1 Basic information of types of focused factory
Cases Interviewee Service offering Number of
specialists
Patients annually
Case 1 Operational director Clinical heart care - 7500
Case 2 Workplace manager& surgeon Eye care 11
30000-40000
Case 3 operational director Diagnostic test for asthma 2 250
Case 4 head of the unit Treat morbid obesity 3 620
Case 5 Founder Diagnose and treat sleep
disorder
2 3000
Case 6 Specialist Eye surgeries 6 7500
Case 7 Project manager Diagnostics, MRI and CT with
pain treatment and gastroscopy
40 -
Case 8 financial director A clinic for morbid obesity 11 7000
Case 9 Owner& Chairman of the
director and doctor
Insured eye care 5 31000
Case 10 Co-owner& specialist Most common eye care 4 700
We find that ten focused factories indeed apply integrative practices and manifestations, which means that focusing and integrating can co-exist in Dutch healthcare setting. This result is discussed in within and cross-case analysis.
4.1 Within- case analysis
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Petersen, (2002); Pagell, (2004), Wong & Cheng, (2010), Drupsteen et al.,(2013) ,
Raghupathi& Tan(2002) ,Abidi (2007) , Zwarenstein, et al.,(2009) and Musson& Helmreich (2004). There are 5 chosen manifestations for internal integration: application of IT,
communication, sharing of planning information, sharing of waiting list information and cross-functional teams. Moreover, other 5 selected manifestations for external integration: application of IT, information sharing, planning collaboration, joint collaboration& knowledge sharing and resource sharing.
These practices are selected reasonably and rationally because they both derive from the literature and emerge from the data of ten cases. Cases in Table 4.2 have already been grouped into different types of focused factories. We can see case 3, 4,6 and 9 are focused types; case 5 and 8 are process- focused types; case 1, 2, 7 and 10 are the product-process-focused types.
Case 1 is a product-process-focused factory with 7500 patients annually, providing clinical heart care service. We found three practices for internal integration and four for external integration. Electronic Patients Dossier (EPD) as an IT system are used both within and outside the organization. Patients are allowed to access to their dossier, which means an active and frequent information sharing and communication with customers (parties in downstream of supply chain) regarding information flows. Some related results are also sent to other organizations of the care chain, like General Practitioner (GP), for further treatment and tests. In this way, Information Technology (IT) system is used to integrate both in patients and in upstream or downstream parties within the care chain. They have joint product collaboration with other hospitals who offer CT/MRI scan service and also share specialists with other organizations.
Case 2 is a product-process focused factory. With 11 specialists and 30000-40000 patients per year, it is a relatively larger scale eye care center in the Netherlands. We found two practices both for internal and external supply chain integration. They applied EPIC system to sharing information with provider of the patients, handling patients’ information to make sure the information can be transfer to all related doctors who are responsible for this management. This indicates an efficient integration in terms of patients and information flows. To ensure data safety, fax is used by them for contacting with the referrals but not extensively used to communicating with others. Sharing waiting lists and resources, cross-functional teams, planning collaboration and joint product collaboration are absent. They just sometimes joint collaboration with the X-ray departments to sharing knowledge but most specialists work only for this organization.
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Planning collaboration, sharing measurement equipment and specialists are also the
manifestation of this company integrate with other hospitals. Meanwhile, they also implement the improvement meetings with external specialists to share specialized healthcare
knowledge.
Case 4 is a product-focused factory with 3 specialists and 620 patients per year, offering morbid obesity treatment. We found four practices for internal and five for external integration. They apply a well-planned managed IT system to share information with employees and external organizations. They have formal and structural meetings regularly with various external parties, like specialists involved in care process, ICT support companies and third party companies who is responsible for the operations of website for patients’ aftercare. This ensures the relevant knowledge can be shared among different parties. As they share planning and waiting list information within this organization, everyone is clear what has to be done as the agenda is clearly divided into concrete treatment steps. They also collaborate their Planning with hospitals, dieticians and psychologists and share operating rooms but do not share specialists.
Case 5 is a process focused factory which diagnoses and treats patients with a sleep disorder. They have 2 specialists in FTE, treating 3000 patients annually. We found three practices and four practices for internal and external supply chain integration, respectively. An E-health system is implemented by them, which creates an effective way of sharing information and communicate with employees, referring doctors, dentists, and psychologists. All patients’ procedures of treatment are monitored within this total system to ensure an effective
interaction and collaboration. Zorgmail and Zorgdomein are also applied as an EDI exchange way to interact with different parties. Multidisciplinary meetings are present in this
organization with the aim of sharing knowledge, skill and learn from others to make progress together among parties. Similarly, they also share specialists with others.
Case 6 is a product-focused factory which provides eye surgeries. With 6 specialists and 7500 patients per year, it is a middle size company among ten cases. We found three manifestations for internal integration and four manifestations for external integration. They use a central allocation organ and EPD to manage information and patient flows. With emails, meetings and sharing planning information, they achieve an integration within the company. They mainly share information with referrals, external parties, through the post, Zorgdomein, and Zorgmail, but here, typical email is forbidden. They also share specialized knowledge via meetings, inviting specialists from other organizations with a related topic which would be discussed in great depth during the meeting four times per year. For sharing resources, operating rooms, waiting rooms and specialists are shared with other organizations.
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and pre-scan facilities with partnership organization. Also, a plenty of seminars and
inspections which aim at enhancing treatment quality are also held among specialists, and this supports knowledge sharing with external parties. They are hardly collaborating their patient planning with others as they are ambitious to realize dependability concerning supply chain partners.
Case 8 is a process focused factory which is a clinic treats morbid obesity with 11 specialists and 7000 patients annually. We found all five practices for internal integration and four practices for external integration. They apply EPD which follows patients through the whole treatment procedures. Together with sharing planning information and waiting lists,
employees can observe patients' treatment steps accurately. They also create cross-functional teams to management patients, and information flows among various units within the
organization. For external aspects, they share information with surgery parties through e-mail correspondence. Training, information days and multidisciplinary programs with outside organizations are also involved in this company. Also, they share operating rooms and specialists with others. In this way, a higher degree of both internal and external supply chain integration can be seen in case 8.
Case 9 is a product-focused factory with 5 specialists and 31000 patients annually, providing insured healthcare service regarding eye care. We found four practices for internal integration and three for external integration. A customer relation management(CRM) system is applied as the IT system by case 9 to sharing information and contact with both internal employees and external parties, such as hospitals, GP’s, Industry associations, politicians. Regular discussions and meetings are held within the company so that all management stuff can be discussed to get feedback. All systems are integrated, thus planning and waiting lists information can be quickly sent to the concerned person. However, their planning is completely arranged within the company. Therefore they do not collaborate planning with external parties. They involved feedback sessions in inviting patients and specialists from other organizations to share knowledge and skills to achieve efficient service. Furthermore, resource sharing is absent in case 9.
Case 10 is a product-process-focused factory with 4 specialists and 700 patients per year, offering most standard treatments regarding eye care. We found three internal integrative practices and five external integrative practices. They use EPD, EPIC system and Zorgdomein to support the interaction and communication with employees, hospitals, GPs and insurance companies. Meetings and verbal contacts are also the formal and informal way of
communicating with staff within the enterprise. Moreover, they are also sharing planning information within the organization to make sure that the plan is directly available to the specialists. They also collaborate their plan with hospitals and GP referrals. Knowledge is sharing by meetings with specialists from other hospitals. Moreover, they usually share some of the operating room and all specialists.
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Table 4.2 within-case analysis
Cases Focus type Internal supply chain integration manifestation External supply chain integration manifestation
Case 3 Product Patient system; Meetings; Share agendas, planning and
waiting list information.
Sharing info with patients providers; Telephone, Zorgmail, Zorgdomein; Planning collaboration; Improvement meeting; Share equipment and specialists
Case 4 Product A well-plannable managed system; Formal and structural
meetings; Share planning and waiting lists information
“Everyone is clear what has to be done.”
Sharing info with dieticians, psychologists, motion-center and ICT; Planning collaboration; Knowledge sharing.
Case 6 Product A central allocation organ; Email and meetings;
Sharing of planning information.
Sharing info with Referrals; Zorgdomein, and Zorgmail; Sharing knowledge with opticians.
Case 9 Product CRM; Discussions and meetings; Sharing of planning
information; Sharing of waiting list information; “easily
send to specialists.”
Sharing info with hospitals, GP’s, Industry associations, politicians; CRM system;“Feedback sessions.”
Case 5 Process E-health program; “total process monitored by all
employees”; Sharing planning and waiting list information
with all stuff.
Sharing info with referring doctors, dentists, and psychologists; EDI exchange, Zorgmail, and Zorgdomein; Multidisciplinary meetings and share specialists with other organizations
Case 8 Process EPD; Meetings; Sharing of planning information; Sharing
of waiting list information “Working with an integrated
waiting list”; Cross-functional teams.
Sharing info with the hospital for surgery; e-mail correspondence; Training or information days, multidisciplinary program; Sharing operating rooms and specialists.
Case 1 Product-Process EPD; meetings; Sharing of planning information. Sharing info with patients and GP; EPD; Sharing knowledge.
Case 2 Product-Process EPIC; “no regular meetings just in an informal manner”;
Sharing of planning information.
Sharing info with provider of the patients; “Fax but not extensively
used, except for the referrals”;
Case 7 Product-Process EPD; Meetings; “Waiting lists are published on our website.” Sharing info with another hospital; Zorgdomein; Improvement
meetings or retraining; Sharing pre-scan facilities and specialists. Case
10
Product-Process EPD, EPIC; Meetings and verbal contacts;“Planning is
directly available to the specialists.”
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4.2 Cross-case analysis
In this part, similarities and differences can be seen from types of focused factories about manifestation and practices for internal and external supply chain integration.
We find that actual integrative practices and manifestations are differently applied even in the same type of focused factories. It means that supply chain integration situation in the same sort of focused factories are sometimes different. Moreover, among diverse types of focused factories, we do not find substantial differences when regarding supply chain integration.
4.2.1 Product-focused
As for practices regarding internal integration, it is shown from the result that product-focused factories’ ways of communicating with internal employees are all including meetings.
However, the meetings can be sorted into different patterns, such as formal meetings, structural meetings, discussions with a topic to gain feedbacks regarding managing patients and information flows. Besides, product-focused factories share the planning information within organizations by using different IT systems (EPD, CRM) in order to achieve an integration in terms of patients’ treatment procedures. For example：
Case 3: “Yes. We share agenda with each other.” Case 4: “Yes. Everyone is clear what has to be done.”
Case 9: “Yes. All systems are integrated. So patient planning information can be easily send to the concerned person”
It is a fact for the product-focused type that their need for integration now is not consistent with their actual degree of supply chain integration. This can be measured from the result of the questionnaire. They hope they can involve both patients and information flow with
external parties to ensure the efficiency and to achieve a higher degree of external integration. This thinking suggests that they need more integration with external supply chain members in the future. However, what they are doing now are not fulfilling their thinking. We can see from the result that not all of product-focused factories collaborate their internal planning with external parties. Examples can be found out in concrete cases:
Case 6: “No. As we are responsible for the whole treatments for patients.”
Case 9: “No. Planning is entirely arranged internally by the system.”
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While not all of the product-focused factories share their facilities, such as treatment equipment, operating rooms and specialists with other organizations. Some of the product-focused factories do not share any resources with other external parties, which means that they are performing highly “focused.” For example:
Case 9: “All physical assets are dedicated to the organization and are not shared. Specialists are entirely devoted to the organization. ”
All these findings conclude that supply chain integration in product-focused factories shows a relatively lower degree in a practical situation, which is opposite to their desire for
integration.
4.2.2 Process-focused
According to the characteristic of services provided by process-focused factories, it is necessary to implement extensive contacts with relevant external organizations. This idea is also in line with the result that process-focused factories share patient flows and information with massive external parties which are related to their offering services. These external organizations usually provide services which assist process focused factories’ treatments. For example:
Case 5: “We share information with referrals, referring doctors for intake, Dentists who make MRI, providers of C-Pep (mask for sleep apnea) and psychologists specialized in cognitive sleeping disorders.”
As for external supply chain integration, process-focused factories organize multidisciplinary meetings, training and consultant days with external partners to share specialized healthcare knowledge and skills. This integrative practice helps them to learn from others' advanced analysis easily, to make progress together and to provide more efficient services. Also, process focused factories also share specialists with related external parties:
Case 5: “they (specialists) are working part for other hospitals and part for us. It is a common way of employing specialists.”
Case 8: “Specialists rarely work for just one organization. They often treat different patients with different operations.”
With diverse objective and services offering of various organizations, process-focused factories can absorb professional employees by sharing specialists with relevant partner companies.
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of integration is greater than that of other two types of focused factories; second, cross-functional teams as integrative practices are not popularly applied by most healthcare focused factories in the Netherlands.
4.2.3 Product-process-focused
Product-process-focused factories have similarities with both product-focused factories and process-focused factories. Results can be found that they share resources regarding specialists with other external organizations. Similarly, when it comes to knowledge sharing aspect, they also organize meetings with specialists from external parties to create chances for exchanging skills. These manifestations are consistent with what has been done in process-focused
factories. Examples can be found as follows:
Case 7: “Yes. Medical specialists can choose whether they want to work for fully for DC clinics or shared with other hospitals.”
Case 10: “Yes, all the specialist are also working somewhere else.”
Case 7: “Yes, we have improvement meetings or retraining with regional GP’s;”
Case 10: “Meetings for specialists from other hospitals are organized to enhance healthcare efficiency.”
As for planning collaboration aspect, the planning in most product-process-focused factories do not get influenced by other external parties. Consequently, they do not collaborate
planning with others. This result is the same as what have been done by product-focused factories.
Case 2: “Not much. Patients do not require treatment from other departments.”
Case 7: “No. We are not dependent on the planning of others. There is no connection in between.”
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Overall, we find several similarities and differences in three different types of focused factories:
No matter what types of focused factories it is, each organization has to manage and distribute
patient flows, making it efficientlycommunicate throughout the organization. In this way, IT
system is bound to be applied extensively in supply chain integration. Besides the common use of E-health system, EPD, and EPIC system, some organizations even develop their own CRM system, which is based on their healthcare service and scale of the company. Similar, several email software systems, such as Zorgmail, Zorgdomein, are utilized by nine focused factories as well. This finding means that a significant number of focused factories in Dutch healthcare setting are now performing their operations regarding correspondence professional and scientific. Moreover, three types of focused factories all realize a high frequency
regarding communication and interaction inside their own organization in several different styles, such as formal meetings, verbal contacts, emails, remote desktops and so forth. This idea that communication and interaction are necessary and irreplaceable in the healthcare system and even whole industries nowadays. When looking at the organizational structure aspect, cross-functional teams are not popularly applied by most healthcare focused factories. This fact suggests that most focused factories in the Netherlands do not pay attention to implementing this practices when integrating internal operations.
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5. Discussion
According to the main findings, this paper justifies that focusing and integrating can co-exist in Dutch healthcare setting. It realizes an expectation to make sense between types of focused factories and supply chain integration, providing a judgement concerning about the degrees of supply chain integration among types of focused factories.
It can be seen that cases even from the same sort of focused factories have different
manifestations regarding supply chain integration. This problem is seemingly caused by case selection. As mentioned before, there is a lack of clear criteria which can be used to justify the focused types. Thus, we reference the protocol from Bredenhoff et al., (2010), trying to make a relatively clear category. Information can be seen from Appendix C that when each case is classified into types of focused factories, the criteria depends on the ratio (score for product-focused/ score for process-focused). The difference between the ratios sometimes is not noticeable enough to make a clear distinction claim which type the case belongs to. We set cut-off points (0.85 to 1.15) based on the data boundaries for the ratio in order to gain a balanced and fair number of cases for each type of focused factories. However, this range can fluctuate subjectively. Therefore, this should be a bit flaws regarding classification of types of focused factories and may lead to the difference regarding results.
Besides, the difference between literature and the consequence of this study can be found in the definition of process-focused factories. The process-focused factory is defined by Bredenhoff et al., (2010) that it includes two factors: low complex treatment and low risk treatment. However, the result shows that not all of the process-focused factories involves these two factors. For example, Case 4 organization indicates that they put emphasis on the entire treatment process of the patient, but the treatments are indeed supposed to be high-volume, high-risk and high complexity. Although this opinion is not in line with what has been claimed in the work of Bredenhoff et al., (2010), this is mainly because case 4 belongs to product-process-focused type, their services are not concentrating only on one aspect but involving both characteristics of product-focused and process-focused types. In other words, the categories from Bredenhoff et al., (2010) are still applicable to make sense. Moreover, this difference put forward a further angle to investigate, which is concerning the services and treatments provided by product-process-focused factories, trying to clearly figure out what are their concentrations.
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internal supply chain integration in healthcare organizations. However, in this study, this manifestation is not presented in the ten cases. Different research scopes can explain these problems. This paper concentrates on focused factories scope while Drupsteen et al., (2013) is based on a hospital scope. Thus, if future research is carried on focused factories, a slight adjustment of relevant manifestations regarding supply chain integration should be done to make it suitable for the research scope. This also instructs a new direction for further study.
Furthermore, from the result part, a fact can be confirmed that the information sharing, communication, and planning collaboration do play a crucial role in the supply chain
integration for all types of focused factories. This fact is in line with what has been stated by Ettlie & Reza, (1992); Lai, Wong& Cheng (2010) and Ragatz et al., (2002). Also, in
healthcare focused factories area, the interaction of information flow and patient flow are regarded as the principal aim of information sharing and communication. These tasks are completely by the application of IT systems. Consequently, it will make more sense to
research the IT systems used in focused factories in details for the future study. Such like that what kind of professional healthcare software or what kind of professional healthcare
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6. Conclusion
To conclude, three types of focused factories do integrate their supply chain. However, the degrees of supply chain integration in each type of focused factories are different. According to the result, the process-focused type is proposed to have a higher need and degree of supply chain integration than that of other two types. This point is mainly reflected in the external integration aspect including information sharing, resource sharing, knowledge sharing and planning collaboration. The amount of external parties and practices involved in supply chain integration of process-focused factories is greater than that of another two categories.
This paper is academically contributed as one of the first scopes which look at the relations of focused factories and supply chain integration within Dutch healthcare area. To be more specific, this paper provides an academically extended research based on the classification of types of focused factories in the work of Bredenhoff et al., (2010), inducing a new direction for types of healthcare focused factories regarding internal and external supply chain integration.
Given the practical contribution, this paper can serve as the guidance of healthcare focused factories’ stakeholders to instruct their operations themselves and learn from others regarding the need and actual situation concerning supply chain integration. Also, this paper provides a reference about choosing proper integrative practices and manifestations to fit in between their need for integration and development. In this way, a friendly and sustainable allocation of healthcare resources in Dutch healthcare context could be realized to achieve promising developments in the future.
It must be said that this study has several limitations. First of all, this research is based on a relatively small-scale as it mainly concentrates on the focused factories of healthcare system within the Netherlands. This aspect limits the research value. Also, some imperfections (e.g. the invalidated answers due to the misunderstanding for interviewees about the questions, the vacant answers due to the time constraint during interviews and so forth) appeared during the procedure of interviews might lead to a flaw in this analysis. Furthermore, with a limited amount of cases, we obtained only two cases (Case 5 and 8) which belong to a process-focused type. Combined with a flaw from case selection we mentioned in the discussion section, an uneven allocation regarding the number of cases in each type of focused factory is existing. Thus, this research cannot represent the whole healthcare industry regarding this paper’s topic.
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creating a more scientific and rational questionnaire. Moreover, manifestations related to the degree of supply chain integration should be refined to make it proper to the context of focused factories in the healthcare system. In this way, the further study would gain more pertinence.
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Appendix A Open questions
Descriptives of focused factories
1. What is your name?
2. What is your role in your organizational unit?
3. What is the service offering of your organizational unit?
4. What were the reasons for the founding of your organizational unit and why did you choose to focus?
5. How does your organizational unit differ from other healthcare organizations? 6. What type of patient groups does your organizational unit treat?
- Sub-question: Where do these patients come from? (Referred by a doctor, hospital, self-referral, etc.)
7. How many patients are treated annually?
8. What is the number of specialists of your organizational unit and the whole organization? (In FTE)
9. How many support staff is employed in FTE?
10. What is the contribution of your organizational unit to the total care process of a patient? Is the whole process conducted in the focused factory or just a part of the entire treatment? 11. When complications regarding patients occur during the treatment performed by your
organizational unit, what resolving steps are to be taken? (Who is responsible for the aftercare; the FF or general hospital?)
- Sub-question: What happens when these complications are caused by external parties?
Overall perspective of focus
12. How do you see the current role of focused factories in Dutch healthcare?
13. What will the ideal situation in Dutch healthcare look like regarding focused factories?
Description of integration
14. How are patient flows and information flows managed within your organizational unit, between departments, or between specialists?
Sub-question: Who is responsible for the management of patient flows and information flows? 15. Do you think your organizational unit requires both internal and external integration regarding
patient and information flows? Can you explain why you think this?
16. With which external parties do you interact regarding patient flows and information flows? Sub-question: What information do you receive and need, and what information do you send? 17. How does the interaction with these external parties look like? Could you give examples?
Sub-question: Who is responsible for this interaction?
18. What are favorable and unfavorable consequences of supply chain integration for your organizational unit? Could you give an example?
19. What integrative practices are employed within your organizational unit? Could you give examples? (Interviewer could give examples like cross-functional teams, departmental
planning)
20. What integrative practices are employed with external parties? (Interviewer could give examples like cross-organizational teams, continuous improvement meetings or EDI exchange)
33 22. After the completion of the patient’s treatment in the focused factory, how does your
organizational unit remain involved in the remaining patient's care process? Could you give examples?
23. What will the ideal situation of your organizational unit look like regarding supply chain integration?
Barriers and enablers
24. What kind of barriers do you experience with integration between internal and external parties and how do these barriers influence this integration?
25. How do you think these barriers could be solved?
26. What kind of factors and circumstances improve the integration with internal and external parties and how do these influences integration?
Relation focused factory type to integration (product/process/product-process)
27. To what extent are specialists focused on a specific treatment or patient sub-group?
28. To what kind of focus type do you think your organizational unit belongs? (Choose product- focused, process-focused, or product-process-focused). And why do you think that?
(Explain if necessary what the different types of focus are)
Relation focused factory degree to integration
29. What physical assets are shared with other parties and/or departments?
30. Are specialists in contact with or employed by other hospitals? If so, in which way?
31. How does the planning in your organizational unit affect the planning of other organizational units or external parties and vice versa?
Service quality
32. What is the average time a patient needs to wait before receiving the desired treatment? 33. How do you guarantee safety and hygiene rules are adhered to?
