Strategy Formation in Complex Organizations: The Evolution of Strategic Issues in Hospitals

ABSTRACT

This study investigates strategy formation in complex organizations by empirically tracking the evolution of strategic issues in hospitals. Given the utmost importance of successfully integrating strategic issues in the strategic agenda, this study focuses on how the structural and strategic contexts infuence strategic issues’ evolution. A case study is conducted in a German hospital group. Five evolution paths of strategic issues are identified, and a model of their evolution is developed. Overall, this study heeds the call to more holistically depict how strategic issues evolve. By discussing the empirically elaborated constraints and supports in the evolution of strategic issues, a better understanding of strategy formation in complex organizations is provided.

KEYWORDS:

• Strategic issue
• complex organization
• evolutionary perspective
• case study
• strategy formation

Notes

1. The strategic intent of the hospital group emphasizes the “increase of revenues, reduction in personnel costs, reduction in material expenses, and structural changes in the process organization” (official strategy paper).

2. In Table 2, this is displayed with a continuous arrow (-→).

3. In Table 2, this is displayed with a discontinuous arrow (- - →).