Organizational Behaviour

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© Jones & Bartlett Learning, LLC. NOT FOR SALE OR DISTRIBUTION

PART

The Marketing Process

I

1

© Jones & Bartlett Learning, LLC. NOT FOR SALE OR DISTRIBUTION

© Jones & Bartlett Learning, LLC. NOT FOR SALE OR DISTRIBUTION

CHAPTER

The Meaning of Marketing
Learning Objectives

1

Learning Objectives
After reading this chapter, you should be able to: • • • • • Define marketing and differentiate between a marketing-driven and nonmarketing driven process Distinguish among marketing mix elements Delineate between health care needs and wants Understand the dimensions of the environment that have an impact on marketing strategy Appreciate the ongoing restructuring of the health care industry

Primary care satellites, integrated delivery systems, managed care plans, and physician–hospital organizations are but a few of the elements that dominate the structure of the health care industry today, as the government, employers, consumers, providers, and health care suppliers deal with a new health care market. This marketplace is typified by massive restructuring in the way health care organizations operate, health care is purchased, and health care is delivered. Competing in this environment will require an effective marketing strategy to deal with these forces of change. This book will focus on the essentials for effective marketing and their implementation in this health care marketplace. This discussion begins with an examination of what marketing is and how it has evolved within health care since first being discussed as a relevant management function in 1976.

s Marketing
For anyone involved in health care during the past 10 to 15 years, the term marketing generates little emotional reaction. Yet, health care marketing—a commonplace 3

© Jones & Bartlett Learning, LLC. NOT FOR SALE OR DISTRIBUTION

concept today—was considered novel and controversial when first introduced to the industry three decades ago. In 1975, Evanston Hospital, in Evanston, Illinois, was one of the first hospitals to establish a formal marketing staff position. Now, more than 30 years later, marketing has diffused throughout health care into hospitals, group practices, rehabilitation facilities, and other health care organizations. In this book, fundamental marketing concepts and marketing strategies are discussed. Although health care is undergoing significant structural change, the basic elements of marketing will be at the core of any organization’s successful position in the marketplace.

The Meaning of Marketing
There are several views and definitions of marketing. The most widely accepted definition is that of the American Marketing Association, the professional organization for marketing practitioners and educators, which defines marketing as “the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives.”1 Central to this definition of marketing is the focus on the consumer, whether that is an individual patient, a physician, or an organization, such as a company contracting for industrial medicine. This definition also contains the key ingredients of marketing that lead to consumer satisfaction. Increasingly, customer satisfaction is the key issue in health care. The Joint Commission, the industry’s major accrediting agency for operating standards of health care facilities, requires—per its 1994 accreditation manual—that hospitals improve on nine measures of performance, one of which is patient satisfaction. A similar requirement is also in place for long-term care facilities. This focus on patient satisfaction is an overt recognition of the need for health care facilities to be marketing oriented and, thus, customer responsive. Moreover, the Center for Medicare and Medicaid Services (CMS) requires all hospitals to distribute to patients and publish the results of its...
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