MMHA 6000 Week 6 Stakeholder Salience Case Example

Week 6 Discussion: Stakeholder Salience Case

Moving the Mill Street Clinic to Hawthorn Commons: Seven Parties Classified by Power, Legitimacy and Urgency, and the Two Management Is Most Likely to Underweight

Decision

Calder Ridge Medical Group, the composite physician group of the invented Calder Ridge Community Hospital, proposes to close its Mill Street primary care clinic in the older east side of town and open a larger clinic in Hawthorn Commons, a growing suburb seven miles west. Management gives three reasons: the Mill Street building needs about $1.2 million in roof and mechanical repairs, most new families in the county are settling on the west side, and the payer mix at Mill Street, 48 percent Medicaid, does not cover the clinic's costs. The move would take effect in nine months.

Model

Mitchell et al. (1997) proposed that a stakeholder draws more of management's attention the more of three attributes it possesses: power, meaning the capacity to bring about outcomes the organization would not otherwise choose; legitimacy, meaning a claim widely accepted as proper; and urgency, meaning how strongly a claim demands immediate attention. Stakeholders with one attribute are latent, those with two are expectant and those with all three are definitive. The attributes change over time, so a party can move from one category to another.

Classification

Table 1

Seven Parties Classified by Salience Attributes

Ratings come from the case facts as described above; the parties are composite.

Patients at Mill Street have the clearest legitimate claim, since the clinic is their source of primary care, and their claim is urgent because the move has a date. But they have little power: they are not organized, many lack cars, and the group's contract does not depend on them. Staff have legitimacy and some power, since medical assistants are hard to replace and several live on the east side. Referring specialists hold power because they send patients to the group's clinics and receive referrals from it. The board holds all three. The council member controls a zoning variance the new site needs, which gives power, and her urgency rises each time a constituent calls. The neighborhood association has a strong claim and real urgency but no formal means of pressure. The competing urgent care chain has some power, since it could open near Mill Street and take the patients, and little legitimacy in the decision itself.

Implication

Management is most likely to underweight the two dependent parties, Mill Street patients and the neighborhood association. They hold legitimacy and urgency without power, and the model predicts that managers attend first to parties who can impose costs. Underweighting them would be wrong on two counts. To begin with, the clinic's patients are the people most likely to lose care: transportation barriers are a documented cause of missed appointments and delayed care, particularly for low-income patients (Syed et al., 2013), and a seven-mile move without a bus line could end their primary care altogether. Second, dependent parties can gain power by alliance. If the neighborhood association brings its case to the council member, who controls the zoning variance, the two together become definitive, and management will meet them at a public hearing rather than in a planning meeting.

My recommendation would be to involve the association now, before the hearing, and to test a part-time satellite at Mill Street or a transportation benefit as part of the plan.

Reply to Keisha

Keisha, you classified the referring specialists as definitive, arguing that urgency comes from their concern about losing referrals. I am not sure the case supports urgency yet. The specialists' referrals come from all eight clinics, and the move would shift patients west rather than lose them. Their claim seems legitimate and their power is real, but I do not see anything in the case that makes it time-sensitive. Would you put them in the dominant group until the move actually changes their referral volume?

Reply to Raymond

Raymond, I agree that the competing urgent care chain is dangerous rather than dormant, and your point about its leases near Mill Street adds evidence for urgency I had missed. I would push on one thing: you rated its legitimacy as zero. Blair and Fottler (1990) argued that health care organizations should consider whether a stakeholder could become a partner or a threat, not only how much it matters now. If the chain offered to staff a walk-in service at the Mill Street site, would its legitimacy in the decision change?

References

Blair, J. D., & Fottler, M. D. (1990). Challenges in health care management: Strategic perspectives for managing key stakeholders. Jossey-Bass.

Mitchell, R. K., Agle, B. R., & Wood, D. J. (1997). Toward a theory of stakeholder identification and salience: Defining the principle of who and what really counts. Academy of Management Review, 22(4), 853-886. https://doi.org/10.5465/amr.1997.9711022105

Syed, S. T., Gerber, B. S., & Sharp, L. K. (2013). Traveling towards disease: Transportation barriers to health care access. Journal of Community Health, 38(5), 976-993. https://doi.org/10.1007/s10900-013-9681-1