Abstract English Abstract From small hospitals to large medical centers, the Taiwan healthcare organizations today are unable to significantly increase investments or generate more revenue due to the strict regulations of current National Health Insurance and Global Budget policies. This predicament is further complicated by the healthcare system¡¦s inability to change from its traditional mass production architecture and mentality. Mass customization (MC) and focused factories (FF) are being applied across many industries with great success ¡V achieving quality at low cost. These are new concepts that can bring significant customer value, allowing organizations¡¦ quality and profitability to improve from increasingly commoditized businesses. This consumer-centric transformation can be one way for Taiwan¡¦s healthcare organizations to get closer to patients¡¦ needs and step out of the traditional confines of the NHI and healthcare delivery. These novel ideas are so akin to the healthcare ideal, yet the traditional healthcare design and Taiwan¡¦s anti-market healthcare policies effectively impedes changes and progress in this direction. This paper intends to assert that MC and FF can be one effective solution to the problems in Taiwan¡¦s healthcare organizations ¡V specifically for the specialty community hospitals. In this way, these small hospitals can capture the value premiums of this new consumerism trend and transform itself into a competitive business, creating higher values for life and health for its customers. This paper will begin with an in-depth background and SWOT analysis of the Taiwan healthcare system and its participants. After an understanding of this industry, a pertinent literature review of the MC and FF concepts and mechanics will be done. A case comparison study of three specialty healthcare organizations will be done to evaluate their differences in competitive strategy, marketing orientation, operational effectiveness, human resources advantage, and organizational performance. The three organizations include a traditional specialty hospital (Gee-Tien Ear Nose & Throat Hospital), a single procedure-based focus factory (Shouldice Hospital), and a disease management focus factory (MedCath Corporation). Finally, a full discussion will ensue to assess the applicability of FF and MC concepts for specialty community hospitals in the Taiwan healthcare market. Keywords: Specialty Hospitals, Mass Customization, Focused Factory, Taiwan Healthcare

This dissertation examines the proliferation of specialty hospitals in the United States. Since the 1990s specialty hospitals increased in number and stirred much controversy, given that most are for-profit and physician-owned. They are examined here according to the Organizational Ecology Theory, a theoretical framework used in many industries to explain the founding of new organizational forms. Given that general hospitals have been the dominant organizational form in the hospital industry, the emergence of specialty hospitals is explained in this dissertation by applying organizational ecology theories: resource partitioning, density dependence and niche formation. Moreover, I examine the effect environmental and institutional variables have on the variations in specialty hospital proliferation between different states in the United States. The data used in this dissertation are mainly derived from the American Hospital Association Annual Database and the Area Resource File. The Negative Binomial Generalized Estimating Equations method is used to test the models in Stata 9. The findings from this dissertation provide support to both the density dependence, niche formation, and resource partitioning theories. The volume of surgical procedures seems to have a positive effect on the number of new specialty hospitals in a state. Specialty hospitals founding rates also seems to be positively related to the closure rate of general hospitals. Moreover, specialty hospitals founding rate was significantly affected by the intra-population density of specialty hospitals in the area they were founded. As for environmental and institutional factors, the presence of a Certificate of Need program negatively affects the founding rate of specialty hospitals in a state when specialty hospital density is not accounted for in the model. Economical variables, on the other hand, were significant in all the models. Specialty hospitals were positively related to state per capita income and negatively related to unemployment rate. One of the interesting findings of this study is that specialty hospitals founding rate is negatively related to physician expenditures. Thus, less income might be inducing physicians to open their hospitals to recoup financial losses. This dissertation is not just important due to its contribution to organizational ecology, it is also important because it explains to policy makers the reasons that lead to the proliferation of specialty hospitals and the future of these new entrants into the health care arena. / Business Administration

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