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HSO: For the duration of this course, I will focus on community hospitals, specifically those operating in rural and underserved areas. These hospitals provide essential healthcare services such as emergency care, primary care, and outpatient services. To provide a more structured and comprehensive analysis, I will use AdventHealth Hendersonville—a rural community hospital within the broader AdventHealth system—as a representative HSO for my study. This organization has implemented telemedicine services and shares many characteristics with smaller community hospitals facing similar operational and technological challenges.

To prepare:

· Review the Learning Resources on constructing an internal-external matrix.

· Review the Learning Resources on synthesizing components of a SWOT analysis.

· Review the Learning Resources on strategic considerations in changing environments.

· Review both the external and internal portions of your SWOT analyses (your external factor evaluation [EFE] and your internal factor evaluation [IFE]) that you completed in previous modules. Pay close attention to any feedback your Instructor provided, and then make corrections to your IFE and EFE if needed. You will use these analyses to construct your internal-external matrix.

· Chapter 20 of your textbook explains how to create an internal-external matrix. The Application of Internal-External Matrix document also provides an example matrix and additional background information about the purpose of the matrix and the implied organizational strategies. Be sure to review both resources, and then use the Module 4 Internal-External Matrix Template to complete your own matrix and answer the associated interpretation questions.

Example.pdf

Example Internal-External Matrix

The matrix below depicts an HSO with the following total factor evaluation scores:

• Total External Factor Evaluation (EFE) Score = 2.275

• Total Internal Factor Evaluation (IFE) Score = 2.400

The intersection of these scores occurs in the center cell of the matrix which is

aligned with “Hold and Maintain” organizational strategies.

Weighted IFE Score

Strong 3.0–4.0

Average 2.0–2.99

Weak 1.0–1.99

W e

ig h

te d

E F

E S

c o

H ig

3 .0 – 4

A A B

M e

d iu

2 .0 – 2

.9 9

L o

1 .0 – 1

.9 9

B C C

Implied Strategies

A Grow and Build Forward integration, backward integration, horizontal integration, market development, product/service development, market penetration

B Hold and Maintain Market penetration, product development, joint venture

C Harvest and Divest

Retrenchment, divesture, liquidation

2.400

2 .2

7 5

HSO

Examples of Implied Strategy Applications

The examples below describe various ways different types of HSOs might employ the strategies outlined in the Implied Strategies Table.

Integration Strategies

• Forward integration: [Grow and Build]

o A medical practice HSO creates a transportation service to bring

customers to and from its offices.

o A community hospital HSO creates a for-profit subsidiary to enter the DME

and Pharmacy consumer market.

• Backward integration: [Grow and Build]

o A regional medical HSO creates an insurance subsidiary to facilitate

customer bonding via HMO/PPO business.

o A hospital HSO buys medical practices to actively enter the

patient/consumer [preadmission] portion of the healthcare market.

• Horizontal integration: [Grow and Build]

o One HSO system merges with or acquires another HSO system in order

to maximize the utilities of scale and scope of services.

o An insurance HSO is purchased by a regional referral medical HSO to

gain economies of scale and scope in the market.

Intensive Strategies

• Market development: [Grow and Build]

o Pricing: A durable medical equipment (DME) HSO implements a two-

tiered pricing system for cash or insurance payment.

o Distribution: A medical practice HSO signs a contract with a local high

school to provide athletic physicals and team sports coverage.

o Branding: An orthopedic medical practice HSO creates a media campaign

to identify itself as the provider of choice for runners.

o Promotion: A Level II Trauma Center HSO offers a Speaker’s Bureau for

Community Organizations to request presentations.

o Sales: A large medical HSO offers used office equipment to the public at

significant discounts.

o Product Development: A university healthcare HSO produces software

that is marketed to medical practitioners.

o Marketing: An OB/GYN HSO provides maternity and baby clothing for sale

in its offices.

o Target Market: A community hospital HSO offers a Silver Sneaker

program to seniors.

o Niche: A community, healthcare HSO offers counseling and suicide

prevention services.

o Mass Marketing: A regional referral HSO sends flyers to all community

households offering discounted preschool physicals.

• Product/service development: [Hold and Maintain]

o A community hospital HSO develops a comprehensive breast care center

as a separate building on its campus.

• Market penetration: [Hold and Maintain]

o A university affiliated hospital HSO builds and operates medical offices in selected communities of its market.

Defensive Strategies

• Joint venture: [Hold and Maintain] o A physician practice HSO works with a surgical equipment company to

identify new tools and techniques for open heart surgery.

• Retrenchment: [Harvest and Divest] o A community hospital HSO closes all its outpatient clinics and reduces

overall staffing by 10%.

• Divestiture: [Harvest and Divest] o A DME HSO sells its entire line of lift chairs to a competitive DME

business and exits that market.

• Liquidation: [Harvest and Divest} o A parent holding company HSO sells its for-profit, real estate holding

subsidiary to a national real estate corporation.

Template.docx

	Internal-External Matrix Template
Student Name:
Date:

Internal-External Matrix

Review your external factor evaluation (EFE) and your internal factor evaluation (IFE). Ensure you incorporated all Instructor feedback and made any necessary corrections. Then, identify your EFE total score and your IFE total score.

· Use the matrix below to place your EFE total score on the vertical axis. Draw a dashed horizontal line extending from this point.

· Next, place your IFE total score on the horizontal axis. Draw a dashed vertical line extending from this point.

· At the intersection of your two dashed lines, draw a circle to represent your HSO.

	Internal-External Matrix for (Insert your HSO’s name.)

		Weighted IFE Score
		Strong 3.0–4.0	Average 2.0–2.99	Weak 1.0–1.99
Weighted EFE Score	High 3.0–4.0	A	A	B
	Medium 2.0–2.99	A	B	C
	Low 1.0–1.99	B	C	C

Implied Strategies
A	Grow and Build	Forward integration, backward integration, horizontal integration, market development, product/service development, market penetration
B	Hold and Maintain	Market penetration, product development, joint venture
C	Harvest and Divest	Retrenchment, divesture, liquidation

Internal-External Matrix Interpretation

· Identify the implied strategies that correspond with your HSO’s location in the matrix. Explain what they might look like at your HSO. Also explain why each strategy does or does not make intuitive sense to you based on your knowledge of your HSO and the industry. ( Note: The list of strategies is included above and also on page165 of your Wayland and McDonald textbook.)

· Read the following article about the need for HSO’s to pivot and adapt to constantly changing environments. Consider the ways your HSO has experienced significant environmental changes in recent years. Describe how the implied strategies from your internal-external matrix could help your HSO successfully adapt to a changing environment. In your description, explain how this adaptation could help or hinder your HSO’s adherence to its stated mission. Be sure to cite the article in your response.

· Kaplan, G. S. (2020). Defining a new leadership model to stay relevant in healthcare. Frontiers of Health Services Management, 36(3), 12–20. https://doi.org/10.1097/HAP.0000000000000077

· Explain how the implied strategies that correspond with your HSO’s position in the internal-external matrix could inform strategic recommendations to your HSO’s leadership.

Internal-External Matrix adapted from Wayland, M. S., & McDonald, W. G. (2021). Strategic analysis for healthcare: Concepts and practical applications (2nd ed., pp. 167–168). Health Administration Press.

Needed.docx

To prepare:

· Review the Learning Resources on constructing an internal-external matrix.

· Review the Learning Resources on synthesizing components of a SWOT analysis.

· Review the Learning Resources on strategic considerations in changing environments.

Example.pdf

Example Internal-External Matrix

The matrix below depicts an HSO with the following total factor evaluation scores:

• Total External Factor Evaluation (EFE) Score = 2.275

• Total Internal Factor Evaluation (IFE) Score = 2.400

The intersection of these scores occurs in the center cell of the matrix which is

aligned with “Hold and Maintain” organizational strategies.

Weighted IFE Score

Strong 3.0–4.0

Average 2.0–2.99

Weak 1.0–1.99

W e

ig h

te d

E F

E S

c o

H ig

3 .0 – 4

A A B

M e

d iu

2 .0 – 2

.9 9

L o

1 .0 – 1

.9 9

B C C

Implied Strategies

A Grow and Build Forward integration, backward integration, horizontal integration, market development, product/service development, market penetration

B Hold and Maintain Market penetration, product development, joint venture

C Harvest and Divest

Retrenchment, divesture, liquidation

2.400

2 .2

7 5

HSO

Examples of Implied Strategy Applications

The examples below describe various ways different types of HSOs might employ the strategies outlined in the Implied Strategies Table.

Integration Strategies

• Forward integration: [Grow and Build]

o A medical practice HSO creates a transportation service to bring

customers to and from its offices.

o A community hospital HSO creates a for-profit subsidiary to enter the DME

and Pharmacy consumer market.

• Backward integration: [Grow and Build]

o A regional medical HSO creates an insurance subsidiary to facilitate

customer bonding via HMO/PPO business.

o A hospital HSO buys medical practices to actively enter the

patient/consumer [preadmission] portion of the healthcare market.

• Horizontal integration: [Grow and Build]

o One HSO system merges with or acquires another HSO system in order

to maximize the utilities of scale and scope of services.

o An insurance HSO is purchased by a regional referral medical HSO to

gain economies of scale and scope in the market.

Intensive Strategies

• Market development: [Grow and Build]

o Pricing: A durable medical equipment (DME) HSO implements a two-

tiered pricing system for cash or insurance payment.

o Distribution: A medical practice HSO signs a contract with a local high

school to provide athletic physicals and team sports coverage.

o Branding: An orthopedic medical practice HSO creates a media campaign

to identify itself as the provider of choice for runners.

o Promotion: A Level II Trauma Center HSO offers a Speaker’s Bureau for

Community Organizations to request presentations.

o Sales: A large medical HSO offers used office equipment to the public at

significant discounts.

o Product Development: A university healthcare HSO produces software

that is marketed to medical practitioners.

o Marketing: An OB/GYN HSO provides maternity and baby clothing for sale

in its offices.

o Target Market: A community hospital HSO offers a Silver Sneaker

program to seniors.

o Niche: A community, healthcare HSO offers counseling and suicide

prevention services.

o Mass Marketing: A regional referral HSO sends flyers to all community

households offering discounted preschool physicals.

• Product/service development: [Hold and Maintain]

o A community hospital HSO develops a comprehensive breast care center

as a separate building on its campus.

• Market penetration: [Hold and Maintain]

o A university affiliated hospital HSO builds and operates medical offices in selected communities of its market.

Defensive Strategies

• Joint venture: [Hold and Maintain] o A physician practice HSO works with a surgical equipment company to

identify new tools and techniques for open heart surgery.

• Retrenchment: [Harvest and Divest] o A community hospital HSO closes all its outpatient clinics and reduces

overall staffing by 10%.

• Divestiture: [Harvest and Divest] o A DME HSO sells its entire line of lift chairs to a competitive DME

business and exits that market.

• Liquidation: [Harvest and Divest} o A parent holding company HSO sells its for-profit, real estate holding

subsidiary to a national real estate corporation.

Template.docx

	Internal-External Matrix Template
Student Name:
Date:

Internal-External Matrix

· Use the matrix below to place your EFE total score on the vertical axis. Draw a dashed horizontal line extending from this point.

· Next, place your IFE total score on the horizontal axis. Draw a dashed vertical line extending from this point.

· At the intersection of your two dashed lines, draw a circle to represent your HSO.

	Internal-External Matrix for (Insert your HSO’s name.)

		Weighted IFE Score
		Strong 3.0–4.0	Average 2.0–2.99	Weak 1.0–1.99
Weighted EFE Score	High 3.0–4.0	A	A	B
	Medium 2.0–2.99	A	B	C
	Low 1.0–1.99	B	C	C

Implied Strategies
A	Grow and Build	Forward integration, backward integration, horizontal integration, market development, product/service development, market penetration
B	Hold and Maintain	Market penetration, product development, joint venture
C	Harvest and Divest	Retrenchment, divesture, liquidation

Internal-External Matrix Interpretation

· Kaplan, G. S. (2020). Defining a new leadership model to stay relevant in healthcare. Frontiers of Health Services Management, 36(3), 12–20. https://doi.org/10.1097/HAP.0000000000000077

· Explain how the implied strategies that correspond with your HSO’s position in the internal-external matrix could inform strategic recommendations to your HSO’s leadership.

Needed.docx

To prepare:

· Review the Learning Resources on constructing an internal-external matrix.

· Review the Learning Resources on synthesizing components of a SWOT analysis.

· Review the Learning Resources on strategic considerations in changing environments.

Example.pdf

Example Internal-External Matrix

The matrix below depicts an HSO with the following total factor evaluation scores:

• Total External Factor Evaluation (EFE) Score = 2.275

• Total Internal Factor Evaluation (IFE) Score = 2.400

The intersection of these scores occurs in the center cell of the matrix which is

aligned with “Hold and Maintain” organizational strategies.

Weighted IFE Score

Strong 3.0–4.0

Average 2.0–2.99

Weak 1.0–1.99

W e

ig h

te d

E F

E S

c o

H ig

3 .0 – 4

A A B

M e

d iu

2 .0 – 2

.9 9

L o

1 .0 – 1

.9 9

B C C

Implied Strategies

A Grow and Build Forward integration, backward integration, horizontal integration, market development, product/service development, market penetration

B Hold and Maintain Market penetration, product development, joint venture

C Harvest and Divest

Retrenchment, divesture, liquidation

2.400

2 .2

7 5

HSO

Examples of Implied Strategy Applications

The examples below describe various ways different types of HSOs might employ the strategies outlined in the Implied Strategies Table.

Integration Strategies

• Forward integration: [Grow and Build]

o A medical practice HSO creates a transportation service to bring

customers to and from its offices.

o A community hospital HSO creates a for-profit subsidiary to enter the DME

and Pharmacy consumer market.

• Backward integration: [Grow and Build]

o A regional medical HSO creates an insurance subsidiary to facilitate

customer bonding via HMO/PPO business.

o A hospital HSO buys medical practices to actively enter the

patient/consumer [preadmission] portion of the healthcare market.

• Horizontal integration: [Grow and Build]

o One HSO system merges with or acquires another HSO system in order

to maximize the utilities of scale and scope of services.

o An insurance HSO is purchased by a regional referral medical HSO to

gain economies of scale and scope in the market.

Intensive Strategies

• Market development: [Grow and Build]

o Pricing: A durable medical equipment (DME) HSO implements a two-

tiered pricing system for cash or insurance payment.

o Distribution: A medical practice HSO signs a contract with a local high

school to provide athletic physicals and team sports coverage.

o Branding: An orthopedic medical practice HSO creates a media campaign

to identify itself as the provider of choice for runners.

o Promotion: A Level II Trauma Center HSO offers a Speaker’s Bureau for

Community Organizations to request presentations.

o Sales: A large medical HSO offers used office equipment to the public at

significant discounts.

o Product Development: A university healthcare HSO produces software

that is marketed to medical practitioners.

o Marketing: An OB/GYN HSO provides maternity and baby clothing for sale

in its offices.

o Target Market: A community hospital HSO offers a Silver Sneaker

program to seniors.

o Niche: A community, healthcare HSO offers counseling and suicide

prevention services.

o Mass Marketing: A regional referral HSO sends flyers to all community

households offering discounted preschool physicals.

• Product/service development: [Hold and Maintain]

o A community hospital HSO develops a comprehensive breast care center

as a separate building on its campus.

• Market penetration: [Hold and Maintain]

o A university affiliated hospital HSO builds and operates medical offices in selected communities of its market.

Defensive Strategies

• Joint venture: [Hold and Maintain] o A physician practice HSO works with a surgical equipment company to

identify new tools and techniques for open heart surgery.

• Retrenchment: [Harvest and Divest] o A community hospital HSO closes all its outpatient clinics and reduces

overall staffing by 10%.

• Divestiture: [Harvest and Divest] o A DME HSO sells its entire line of lift chairs to a competitive DME

business and exits that market.

• Liquidation: [Harvest and Divest} o A parent holding company HSO sells its for-profit, real estate holding

subsidiary to a national real estate corporation.

Template.docx

	Internal-External Matrix Template
Student Name:
Date:

Internal-External Matrix

· Use the matrix below to place your EFE total score on the vertical axis. Draw a dashed horizontal line extending from this point.

· Next, place your IFE total score on the horizontal axis. Draw a dashed vertical line extending from this point.

· At the intersection of your two dashed lines, draw a circle to represent your HSO.

	Internal-External Matrix for (Insert your HSO’s name.)

		Weighted IFE Score
		Strong 3.0–4.0	Average 2.0–2.99	Weak 1.0–1.99
Weighted EFE Score	High 3.0–4.0	A	A	B
	Medium 2.0–2.99	A	B	C
	Low 1.0–1.99	B	C	C

Implied Strategies
A	Grow and Build	Forward integration, backward integration, horizontal integration, market development, product/service development, market penetration
B	Hold and Maintain	Market penetration, product development, joint venture
C	Harvest and Divest	Retrenchment, divesture, liquidation

Internal-External Matrix Interpretation

· Kaplan, G. S. (2020). Defining a new leadership model to stay relevant in healthcare. Frontiers of Health Services Management, 36(3), 12–20. https://doi.org/10.1097/HAP.0000000000000077

· Explain how the implied strategies that correspond with your HSO’s position in the internal-external matrix could inform strategic recommendations to your HSO’s leadership.

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