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

Due to rapid change of healthcare environment and the awakening consciousness of health service consumers, healthcare quality becomes a major concern of hospital administrators. In 1999, Taiwan Joint Commission on Hospital Accreditation cooperated with Maryland Hospital Association and then implemented Taiwan Quality Indicator Project (TQIP). On the other hand, within the years 1998~ 2000, Taiwan College of Healthcare Executives developed a localized healthcare indicator series (referred to as Taiwan Healthcare Indicator Series, THIS, afterwards) aiming at providing a better system for monitoring medical care quality for the long run. Nevertheless, relevant reports show that so far not many hospitals actively participate in the THIS. The main purpose of this study is to explore those factors which might influence a district hospital¡¦s decision of whether participating in the THIS no not. Hospital administrators were the subjects of this study. Mailing survey was adopted to collect the data. In May, 2004, a total of 436 questionnaires were mailed out. 147 hospitals responded (i.e. a response rate of 33.72%). The key variables of interest may be classified into three groups-- hospital characteristics, perception of THIS, and professional technique related to THIS. Descriptive analyses showed that more than 60% district hospitals did not participate in the THIS; the reasons are listed in order as follows: lack of budget, lack of quality assurance specialists, indicator unable to meet hospital¡¦s requirement, human resource shortage, annual fee too expensive. As for those hospitals participating in THIS, their considerations are showed in order as follows: better reimbersencement, meeting the requirement of assessment, complying with regulation of the authority, and meeting the requirement of hospital policy and patient needs. Besides, a logistic regression analysis indicated that the most important factor influencing hospitals¡¦ participation in THIS is ¡§whether any medical quality related activity is implemented within the hospital.¡¨ With a response rate of 33.72% and with responding hospitals relatively restricted to Kaohsiung-Pingtung area, a careful generalization of results is needed. Further, it is suggested that a qualitative study design along with a higher response rate of quantitative analysis might help enhance the generalization for future study.