The Competitive Environment and Hospital Performance: An Empirical Investigation

In the current climate of privatisation, hospitals and its managers are finding themselves being confronted by increasing pressures and demands which they must seek to understand and respond to for increasing their overall performance. The environment facing Jordanian private hospitals has never been so complex and challenging as at present. However, limited research has been undertaken on the impact of the competitive environment on hospital performance within this developing market of interest. To bridge the gap, this research investigates the influence that competitive environmental factors (Government Regulations, Competitors, Suppliers, Customers and Third-Party Payers) have on hospital performance in Jordan's private hospital sector. Data were collected through a questionnaire which was administered in private sector hospitals in six Jordanian governorates and via in-depth semi-structured interviews with 143 hospital managers and experts in health services. The findings illustrate that three out of the five variables have a statistically significant effect on hospital performance. Of the three significant variables, government regulations appear to have the greatest impact on hospital performance followed by competitors and customers. As the results confirm significant differences associated with the influence of competitive environment factors on hospital performance, the study demonstrates that hospital performance is complicated and multi-dimensional in nature.