Convergent Business Strategies and Information System Alignments: Lessons from Thai Hospitals and Hotels

Uthai Tanlamai Professor Faculty of Commerce and Accountancy, Chulalongkorn University, Thailand uthai@acc.chula.ac.th

Abstract
This study investigates the alignment of a firms information systems and the viability of three relatively new convergent business strategies - Hospitel, Long Stay, and Homecare Service - in private hospitals and hotels in Thailand. Data were collected from small and medium sized, as well as large and publicly owned, enterprises. In addition, indepth interviews were done with software vendors who specialize in hospital information systems and property management systems. The results consistently show that the Hospitel strategy is more viable for hospitals and the Long Stay strategy is more viable for hotels. Homecare Service is the least viable strategy for either business. Smaller organizations appear to more readily embrace these convergent business strategies than larger ones. Regardless of the size, both hospitals and hotels perceive their information systems to be in alignment with these convergent business strategies. Keywords: convergent business strategy, information system alignment, hospitals and hotels

U. Tanlamai is a full professor in the Department of Accountancy, Faculty of Commerce and Accountancy, Chulalongkorn University. She received her Ph.D. (1983) in MIS from the University of Illinois-Urbana-Champaign. Her research interests are a combination of strategic management and behavior aspects of information system implementation, including areas such as information power, strategic alliances, resource-based view of organizational systems, and value relevance of risk disclosures. They are mostly empirical studies of different service industries: telecommunications, hospitals, hotels, and stateowned enterprises.

CONVERGENT BUSINESS STRATEGIES AND INFORMATION SYSTEM ALIGNMENTS: LESSONS FROM THAI HOSPITALS AND HOTELS 1. INTRODUCTION Thailand, recognized as one of the most exotic places in the world, has much to offer visitors in terms of value for their money in the areas of cuisine, culture, tourism, hospitality and healthcare. It comes as no surprise that for the past few years, slogans such as Being the Health Hub of Asia and Having Tourism as a National Agenda have received much support from the Thai government. Since then, health and hospitality related businesses in Thailand have been exploring different strategies and developing new services in order to move in the direction set forth by the government. As with other small countries such as Indonesia, Myanmar, and Sri Lanka, the majority of the gross national income of Thailand is dependent on tourism. Thus, the images of devastated beach resorts from the recent Tsunami put a major strain on an already hard hit travel and tourism industry. In the past 5 years, Thailand has faced much turmoil with the SARS epidemic, the spread of Bird Flu, terrorism, and fluctuations in the world economy. Two industries in the middle of this chaos are hospitals and hotels. In order to survive, Thai hospitals and hotels tend to use cost reduction strategies or come up with innovative strategies to increase revenue streams. Many organizations have cut operational expenses, while others have used computer based systems to increase efficiency. Many more use these systems to help with the implementation of new

strategies. However, it is difficult to design and implement an information system that will align with all of a firms strategies since many organizational factors and environmental

factors are likely to influence a firms strategic direction (Prahalad & Hamel, 1990; Russo & Fouts, 1997). The twentieth century was a time when information systems enjoyed their most prominent role in corporate identity. Although corporations have recently realized that information systems are a necessary, but insufficient, tool to create competitive advantage, healthcare and hospitality businesses are still far behind in utilizing this resource to its fullest. As Jagel & Coltman (2004) asserted, computers are still used for such tasks as mundane recording, or reporting and analyzing the effectiveness of internal operations, instead of being utilized as a competitive weapon. The use of computerized information systems to sustain competitive advantage has been researched using Porters Competitive Strategies concept (Porter, 1980). Several researchers advocate the use of information systems for short-term, long-term, and sustainable competitive advantage and suggest that organizational information system resources should be deployed so as to best support the organizations strategic orientation (Clemons, 1986; Feeny & Ives, 1989; Ives & Learmonth, 1984; McFarlan, 1984). There is very little empirical evidence available to attest to the need for aligning organizational information systems to an innovative business strategy, especially in the much needed healthcare and hospitality industries. The development of these two industries is important for any developing country. Results from the present study, though somewhat preliminary and limited to a single country, can add some insight into the alignment nature of organizational information systems and business strategies and their relationship to organizational performance.

The remainder of this manuscript is organized into five sections. Section two provides a literature review of the factors influencing the alignment between business strategies and different aspects of the firms information systems. Section three describes the research methodology, including data and samples with detailed sampling frames, the data collection instrument and the data analysis technique. The fourth section summarizes the study results and the fifth section contains discussion, interpretation, and extrapolation of the alignment issues faced by these two service businesses in Thailand. Finally, the sixth section gives a concluding remark and some future research suggestion. 2. LITERATURE REVIEW 2.1 Alignment of Information System and Business Strategy One of the information technology (IT) and information system (IS) concerns of top management is the alignment of their IT/IS strategy with their business strategy. Conflicting views exist as to whether IT should drive business strategies or the other way around. Some executives recognize the need to align their business and IT strategy by involving the IT staff in their strategy development process. Others want to leave the IT executives out of the process until the implementation time (Luffman, Lewis, & Oldach, 1993; Rathnam, Johnsen, & Wen, 2004/2005). While the necessity for alignment between a companys IT strategy and business strategy is evident, the true barrier for strategy alignment appears to be the lack of a business strategy itself. Other impediments to business and IT alignment include

organization structural problems, rapid rate of technology change, difficulty in communicating and understanding IT, the lack of focus on business process reengineering

(BPR) and the misalignment between different business areas (Anuja, 2005; Henderson & Thomas, 1992; Henderson & Venkatraman, 1992, 1993). Since the alignment between IS strategy and business strategy is critical to organizational effectiveness, different classifications of alignment have been created. In their earlier work, Chan and Huff (1993) identified three levels of strategic alignment: the awareness level is achieved when an organization recognizes and acts upon having information systems closely connected with the business; the integration level is marked by the acceptance of joining together the information system plan with an organizational plan; and finally the alignment level is the integration of information systems with the organizations fundamental strategies and core competencies. They also found evidence to support their proposition that organizational information systems should be deployed so as to best support the organizations strategic orientation. Later, Reich and Benbasat (2000), focusing on the antecedents of alignment, classified alignment into short-term and longterm alignment. They examined both the cross-sectional and causal relationships towards achieving organizational objectives. New business strategies are typically introduced as a means to achieve some organizational objectives. However, the introduction of a new business strategy is as dynamic a process as the required realignment of organizational resources, including information systems. In their case study research, Sabherwal et al (2001) found that longitudinal changes in alignment between business management and IT management appeared to fit the modified, punctuated equilibrium model (Gersick, 1991). Specifically, they found that the alignment of information system management to business management is evolutionary. Based on that model, it appears that management may not need to make an

upfront investment in information system resources whenever a new business strategy is developed. This implication is contradictory to the contention of business planners who argue that there are linkages between IS alignment and organizational strategy (Chan, Huff, Barclay, & Copeland, 1997; Henderson & Venkatraman, 1992). Thus, firms should make sure that their information systems are functionally ready before a new strategy is implemented. 2.2 Convergent Business Strategy In order to compete, firms continually come up with new and novel business strategies. Often, innovative business strategies come from applying the strategies from one industry to another industry. The concept of best practice is a good example of crossindustry business strategies. In recent years, the convenience store business model has been of much interest to Thai service industries. Many traditional Thai banks, and even the Thai Postal General, have begun setting up micro-branches at different shopping malls and universities where their clients can conveniently make business transactions at convenient times. Hospitals and hotels in Thailand have been very traditional in the way they do business. However, the problematic business environment facing these two industries has forced them to come up with different types of business strategies. In this study, three types of convergent business strategies used by these two industries are examined: Hospitel, Long Stay, and Homecare Services. These strategies can be classified using the popular topology of Miles et al (1978) -- Prospector, Analyzer, Defender and Reactor. The Hospitel strategy can be classified as the Prospector type, enabling organizations to provide

new products and services, whereas Long Stay and Homecare Services can be classified as Defender types. Hospitel is a term used to represent a new business venue for both hospitals and hotels. The Hospitel business strategy emerged from the idea that a hospital can provide hotel quality service, and a hotel can try to incorporate some of the caring services of a hospital. While the two types of businesses share the need to improve their hospitable services, they have a vastly different business focus: health for the former and pleasure for the latter. Long Stay strategy has been used by Thai hospitals and hotels to boost their income, especially during the low seasons. Since daily room rates are much higher than rates for longer stays, hospitals and hotels would prefer to have their rooms turned over on a daily rather than a monthly or quarterly basis. Finally, Homecare Service includes traditional aftercare services at home by physicians and preventive healthcare services in designated poverty stricken areas. However, physician home visits are very rare in Thailand since there are often not enough licensed doctors and nurses to cover in-hospital needs, whereas infant and/or elderly person homecare services are becoming very popular, especially among white collar working couples. Homecare services for hotels include traditional food catering and event

organizing (e.g., birthday, anniversary, house warming parties). These business strategies, if implemented, should capture additional customer segments as well as providing a means to secure existing customers by differentiating individual establishments within their respective industries. While the Hospitel strategy can set the services of one hospital apart from another as well as differentiate one hotel

from another, the Long Stay and Homecare service strategies do not distinctly set businesses apart from one another. The services rendered from the latter two strategies are more complimentary to the typical business of hospitals and hotels. The Long Stay

strategy allows hospitals and hotels to fully utilize their room and human resource capacity, especially during the low season. Likewise, the Homecare service strategy is

complimentary to existing healthcare and hospitality services in both industries. 2.3 Information System Strategy Harrison (2003) outlines three component levels of strategic analysis: the broad environment level, the industry environment and external stake holder level, and the internal resource level. Although information systems are not specifically included in the internal resource analysis, it is clearly noted that resources and capabilities that are the most valuable for strategy development are those that can lead to competitive advantage. As Andreu et al (1994, p. 45) wrote, Strategy implementation is a central step in getting a strategy in place and working. IT/IS can also play a central role in strategy implementation, sometimes putting constraints on what is really feasible, but also enabling the development of organizational structures and management systems needed to make a strategy work. Healthcare organizations, despite their generally conservative nature, have relied on computer systems to maintain their patient records, to connect to insurance eligibility, and even to give some leeway to the most artistic part of their industry patient care and diagnostic systems. The majority of healthcare companies in Darlingtons report expressed a need for a comprehensive health information system that supports both the front office and back office (Darlington, 1998). The hospitality industry, hotels in particular, tends to

keep pace with the latest information technology and are apt to use it to increase their competitive advantage (Navarro, Lopez, & Dominguez, 2002). IT usages in the hotel industry are widespread even with smaller establishments. However, Hong Kongs hotels are still using IT for more of the routine operational applications than for high-level business decision-making (Law & Jogaratnam, 2005). Although providing quality customer service is still the highest priority for hotels, the IT related strategies are not thoroughly developed, except the movement into providing internet access and customer databases. Linking the utilization of information resources to organizational performance is another area frequently addressed by both management and information systems researchers. Many argue that technology strategy has become one of the driving forces in achieving financial performance. Zahra (1996) found the relationship between technology choices and firm performance to be quasi-moderated by different types of competitive environments. Balanced Scorecard proponents (Kaplan & Norton, 2001; Kaplan & Norton, 2004; Martinsons, Davison, & Tse, 1999) advocate the link between information technology and firm performance. Pollalis (2003) also found some support for the role of consistency (co-alignment) between an organizations business and strategic plans for information systems, in improving overall firm performance. Although large firms are able to invest in information technology, small organizations, in an attempt to be competitive, also use technology to support their strategy implementation. Jones-Evans (1996) studied entrepreneurs who were technologically oriented and found that small entrepreneurial organizations preferred to keep the size of their organizations small, and saw technology as one of the main factors in their success.

Also, Berry and Taggart (1998) found that small high-tech firms which employed a technology strategy to move from being an entrepreneurial organization to a more mature level, lost their flexibility and became more formalized through the process. 2.4 Factors Influencing Strategy Implementation Past research shows that the internal and external factors of organizational and leadership characteristics are also related to a firms strategic decision making processes and its ability to cope in a changing environment (Burgelman & Grove, 1996; Papadakis, 1998). External factors and strategic alliances also influence the viability of a firms business strategies. These factors include management support, strong leadership,

appropriate IS development priority, a good working environment, efficient organizational communication, technology uncertainty, rate of specific IS changes in hospital and hotel businesses, IS personnel cross-over experience, and the business experience of the IS functional unit. According to resource-based theory, internal factors such as resources and capabilities will influence how organizations come up with their strategies, as well as how they bring those strategies into action (Bharadwaj, 2000; Prahalad & Hamel, 1990). Since organizational information systems are important internal resources, their alignment to a new strategy is a precondition for the strategy to be considered viable. For alignment to exist, the information systems must be capable and flexible enough for the strategy implementation. Thus, it is proposed that the viability of a firms business strategies is related to the capability, flexibility and alignment of its information systems. Other internal and external factors also influence the viability of business strategies. Internal factors

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influencing strategic decisions include leadership, allocation of resources, organizational structure, and management systems.

3. RESEARCH METHOD 3.1 Data and Sample Hospital and Hotel data were collected from small and medium sized (SMEs) organizations, as well as large publicly owned enterprises (POE) listed in the Stock Exchange of Thailand. Both quantitative and qualitative research methods are used so as to have a balanced picture of the findings (Chan, 2000). Table 1 shows the sampling frame and response rates. Table 1: Response Rates of SME and POE Hospitals and Hotels is about here For SMEs, 243 hospitals that had over 50 beds were chosen from a total of 471 private hospitals throughout Thailand listed with the Ministry of Health in 2001 (http://mrd-hss.moph.go.th). Likewise, 278 hospitals with over 100 rooms were chosen from a total of 333 hotels listed in the Thai Hotel Association. Since Thailand is still a developing country, one cannot expect small organizations to have formalized organizational information systems, computerized or not. Therefore, very small hospitals and hotels were excluded from the study sample. Geographically, almost one-third of the sample hospitals (31.7%) and almost forty percent of the hotels (37.4%) are located in Bangkok. The southern region of Thailand has the lowest number of hospitals and the northeastern region has the least number of hotels. Most of the responding organizations (36.4% for Hospitals and 46.2% for Hotels) are between 10-19 years old and have between

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100-499 employees (68.6% for hospitals and 84.6% for hotels). This is perhaps typical since many hotels were established during the tourism boom about two decades ago. Every attempt was made to increase the returns by following the recommendations of survey experts (Dilman, 1978). Extensive telephone follow-ups were done one month after the original mailing, however the overall response rates for hospitals and hotels was only 19.8% and 10.1% respectively. During follow up telephone calls, some prospective respondents indicated that they either did not use sophisticated information systems nor did they care to explore the three specific convergent strategies covered in the questionnaires. For those who did not respond and indicated that they did not receive the questionnaire, another set of questionnaires was mailed or faxed to the organization. However, no additional response was received from this second round of questionnaires. It should be noted that the same sampling frame was used in another study (Tanlamai, 2005) which received twice the response rate of the current study (45.3% and 23% for hospitals and hotels, respectively). Following the first study, a four-page executive summary of study findings was sent to every firm, together with the present studys 2 page questionnaire. One possible explanation for the sharp reduction in response rates for the current study is that companies were already satisfied or dissatisfied with the executive summary and did not want to spend the time necessary to get a new one. Although the overall response rate was relatively low, the respondents and nonrespondents have a similar percentage distribution across organizational size. Since size was often found to influence a firms strategic decisions and their implementation of information system projects, it is reasonable to use it as a criterion to compare between

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respondents and non-respondents. Thus, the non-response bias, if any, is evenly distributed across organizations of different sizes. For POEs, the sampling frame includes every hospital and hotel listed in the stock exchange of Thailand in 2004. The ages of the hospitals averaged 25 years and the hotels averaged 35.5 years. While the oldest hospital was 35 years old, the oldest hotel was 128 years. Two hospitals have several properties in major cities across the country. Almost all of the hotels in the sample have several properties in major tourist destinations in Thailand. In-depth interviews of publicly owned hospitals and hotels received a much lower response rate, overall. These organizations indicated that they had a firm policy of confidentiality. Hotel management noted the turbulent environment of the past 5 years and expressed apprehension about giving out any information. In addition, the ups and mostly downs of the business environment have left the management with very little time to spend answering questionnaires or granting interviews. However, with extreme persistence and several telephone inquiries, the IT infrastructure and the name of the software package used by all organizations in this sampling frame was obtained. In an attempt to collect more data on hotels, all hotel related associations (whose memberships include most of the SME hotels and all the POE hotels in the sampling frame) were contacted. The in-depth interviews with hotel related independent organizations such as the Thai Hotels Association, the Association of Thai Travel Agents, and the Tourism Authority of Thailand, confirmed that hotels are reluctant to talk to outsiders. In addition to collecting information from independent organizations, results were triangulated with information obtained from software houses, distributors, and systems integrators of all software packages used by hospitals and hotels. In-depth interviews were

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conducted with all IS providers of all POEs. It should be noted that in a Thai context, the relationships between the IS providers and their clients are very close. Although the IS vendors assessment cannot replace the direct response of their clients regarding the exact viability of different convergent business strategies, they did provide the researcher with some speculation and very insightful data about the functional use as well as the capability and flexibility of these organizations information systems. Extensive secondary data were further collected from the companys registration statement (Form 56-1, www.sec.or.th) filed annually with the Security Exchange Commission, the companys web sites, newspaper and magazine clippings, and so on. Being publicly owned, the POE hospitals and hotels must follow the good Corporate Governance practices and disclose in their annual registration statements their financial position, major competitors, market share, important customers, different types of risks, strategy plan, etc. Also, any news about these hospitals and hotels is usually captivating and makes headlines, especially when they announce a new or novel business strategy or implement a new information system. 3.2 Data Collection Instrument Self-administered questionnaires were used to collect data from both SME hospitals and SME hotels. Similar questions were used for both, with some questions added which are specific to each business. As shown in Appendix A, the instrument was designed to be completed in a minimum amount of time. In-depth interview questions, examining the same set of constructs in greater detail, were sent to the POE hospitals and POE hotels in advance of the interview with an official introductory letter. A follow-up telephone call

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was made to set up an interview appointment. After the interview, if appropriate, a more detailed questionnaire was left with the executive to fill out. The survey instrument consists of 6 sections. Section 1 asks for general information about the business, such as types of customers and major competitors. Section 2 asks the respondent to rate the viability of three convergent business strategies: Hospitel, Long Stay, and Homecare Services. Two questions were used to examine the viability of these three strategies and the time when each individual strategy might be possible. A rating of viability was used, ranging from 0% viability to 100% viability. The reliability test for the viability construct was acceptable (Cronbach Coefficient Alphas = .668). The possible time was classified into five time frames: already have, can start immediately, will start in a few years, wait several years, and never consider. Section 3 is comprised of questions related to the information systems (IS). Do organizational information systems support business strategies? How are the systems evaluated for their efficiency and effectiveness? To what extent does the information produced help management in making their decisions? Section 4, the IS Resource and Capability section, assesses the level of maturity of the organizational information systems, their flexibility, and the alignment of these systems to the firms business units and functions. Information System Capability is measured in terms of different information characteristics for strategic decisions using binary check options (Check/No-check option) for the SME survey and a rating scale of 0-100% for the POE interview. Questions include: whether the system can make quick decisions, has an appropriate pace of making decisions, makes correct decisions, has a minimum of risk taking decisions, and many available alternatives for making decisions. Also, there are

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questions assessing whether the information systems can provide integrative information and help management in making quick, prudent, and logical decisions. Information System Flexibility, on the other hand, refers to the extent to which the organizations information systems are flexible enough to help management with the implementation of convergent business strategies. Again, respondents are asked to check (Check/-No-check option) in the SME survey or to rate from 0-100% in the POE interview whether the information system is flexible enough to adapt to strategy, to have agility, to provide a flexible format and type of information, the variety of data produced, and whether they have adaptive personnel. The Cronbach Coefficient Alphas for all IS flexibility sub-constructs toward each convergent strategy (5 items each) and overall (15 items combined) were relatively high: Hospitel = .878, Long Stay = .921, Homecare Services = .820, and overall flexibility = .754. Section 5 and Section 6 look at the extent to which internal and external factors influence information system resources and capacities. The last section poses one question: whether there is any alignment between IS Resource/ Capability and the viability of strategic decisions. Information System Alignment assesses the readiness of information systems for the implementation of a convergent business strategy. Again five questions ask whether the information system is geared up for the strategy, whether the skills of IS personnel are equipped to deal with the strategy, whether the IS unit aligns with the organizational structure, whether the IS strategy aligns with the Organizational Strategy, and whether the IS objectives line up with each of the convergent business strategies. The respondent was asked to answer in both Check/No-check option and to rate from the scale of 0-100% on

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each question. All Cronbach Coefficient Alphas for question reliability were high, the minimum was .871 and the maximum was .976. The interview instrument and subsequent questionnaire has the same layout. The only difference is that the rating scale of 0-100% is used instead of Yes/ No (Check/Nocheck option) answers. The questions were derived from extensive literature on IS-

Business alignment, information characteristics, and strategic information system resources in healthcare and hospitality industries. 3.3 Data Analysis Technique Both quantitative and qualitative analysis methods were used. Given that the response rates are relatively low for the SMEs, descriptive and non-parametric tests are used to examine the relationships between the viability of convergent business strategies and the capability, flexibility, and alignment of organizational information systems. Qualitative analysis using graphic representation of relationships is increasingly popular as there are many tools and techniques to use. For example, the ATLAS.Ti is a computerized workbench developed by Muhr (Scientific Software Development, Berlin, www.atlasti.de) in the mid 1990s as a network tool that can be used to qualitatively analyze large bodies of textual, graphic and audio data systematically. The network tool provides nodes and linkages with some directional relationships. MindManager, another useful visual tool, is a product of the MindJet Co. Ltd. (www.mindjet.com) which helps in brainstorming and planning activities. This tool uses different types of hierarchical maps to capture, organize, and communicate information and ideas. Even the most popular management tool of the twentieth century, the Balanced Scorecard, uses cause-effect and

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strategic map diagramming to help reduce the vast amount of strategy oriented data (Kaplan & Norton, 2004). The interview data colleted from POE hospitals and hotels and other related organizations, together with the vast amount of secondary data, are analyzed by applying the causal mapping technique used in the Quick Scan and Root Cause techniques. Quick Scan, a data collection and analysis tool used in the field of logistics, also uses a visual technique to analyze the interview data and establish the cause and effect relationships using a visual, diagrammatic representation (Naim, Childerhouse, Disney, & Towill, 2003). This technique is similar to a root cause analysis used by management and information systems researchers to examine the most basic reason for an undesirable condition or problem (Dew, 1991; Wilson, Dell, & Anderson, 1993). In order to ensure the reliability of the resulting cause and effect, diagrams were drawn from the interview tapes together with the transcribed documents, as well as cross-checked with other secondary data sources. Two interview staff members and transcribers accompanied the author to every interview and did the cross-checking to provide consistency to the different rounds of diagramming.

4. RESULTS 4.1 SME Hospitals and SME Hotels 4.1.1 Convergent Business Strategies All three convergent strategies were consistently rated as more viable by the SME hospitals than the SME hotels. Hospitals were more attuned to the Hospitel and Homecare Service strategies than were hotels. SME hotels, on the other hand, were more attuned to the Long Stay strategy. Table 2 shows the analyses of viability for each business strategy by both types of business. Over 80% of the

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SME hospitals view the three convergent strategies as being viable, whereas the only strategy reported to be viable by almost 80% of the SMEs hotels was the Long Stay strategy. When asked further to rate the viability of each business strategy, 26.7% of the combined samples rated the Hospitel strategy as being viable at the 80% level. However, the ratios are about the same (28.6% for SME Hospitals and 22.2% for SME Hotels). Table 2: Viability and Readiness of the Convergent Strategies by SME Hospitals and SME Hotels -- is about here When the difference in means is used, SME hospitals do not differ from SME hotels in their assessment of the possibility of using the Hospitel and Long Stay strategies. The Homecare Service is consistently less viable to hotels than to hospitals (t=2.61, p=0.015). However, no difference is found in the non-parametric statistics on the Homecare Service (Mann-Witney U = 228, Wilcoxon W=364, Z=1.892, p=0.058), indicating no difference between hospitals and hotels regarding this strategy. In terms of readiness to implement each strategy, although over 90% of the SME hospitals appear to be ready, only 46% of the SME hotels are ready for the Homecare Service strategy. SME hospitals see themselves as being significantly more prepared to use the Homecare Service strategy (Kendall tau-b = -0.401, Approximate T = -3.421, p=.001) while SME hotels were more ready for the Long Stay strategy (Kendall tau-b = 0.385, Approximate T = 3.86, p=.000). 4.1.2 Information Systems Alignment Similar to IS Flexibility, a comparative analysis was performed by calculating the means and standard deviation of the number of SME hospitals and SME hotels that chose a given IS alignment feature to a designated convergent strategy. As shown in Table 3, SME hospitals perceive their information systems to be about 60% in alignment with the Hospitel strategy, a little less than 50% with

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the Long Stay and Homecare Service strategies. SME hotels, however, see less alignment of their information systems on all three strategiesabout a 25% alignment, with the highest assessment for the Long Stay strategy. Table 3: Mean and Standard Deviation of the Rating of IS Alignment toward Convergent Business Strategy (%) for SME Hospitals and SME Hotels-- is about here Further analysis was done to examine how SME hospitals and SME hotels differed in their views on the extent of IS viability toward each convergent business strategy. In Table 4, the result of the One-way ANOVA shows a significant difference between the two businesses in their assessment of IS Alignment to the Hospitel and Homecare Service strategies. The Mean SQR differences are 88.666 and 47.790 with the F statistics of 26.679 (p=.000) and 47.790 (p=.001) respectively. No difference between the two SME businesses was found in the IS alignment with the Long Stay strategy. Table 4: One-way ANOVA a of the IS Alignment and Convergent Strategy (SME Hospitals and SME Hotels, Combined Samples) is about here 4.1.3 Information Systems Capability and Flexibility Different characteristics of information that can support the strategic decision needs of an organization are used as the proxy for an information systems capability. Since a check option was used for the respondents to identify whether they agreed that an individual characteristic was part of their organizational information system, multiple response analysis is used. From a total of 69 hospitals and hotels, 310 answers were received. The highest percentage of answers concerned the extent to which information systems help management reduce risky decisions (18.1%). SME hospitals view reduce risky decisions to be most desirable (64.6%). SME hotels, on the other hand, consider appropriate pace of decision-making to

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be the most desirable characteristic (47.7%). The two businesses differ significantly in their views on whether their respective information systems can facilitate the pace of decisions appropriately (Mean Square Difference = 1.206, F=5.583, p<.05). The result appears to echo the possibility that the hospital environment is more vulnerable to wrong decisions and the hotel environment is more turbulent and change occurs quickly. In terms of flexibility towards the convergent strategies, the majority of respondents checked the highest percentages for different flexibility aspects of IS for the Hospitel strategy, as compared to the other convergent strategies (50% pluses and minuses). The multiple responses for all aspects combined, however, shows about the same percentage across questions (20% pluses and minuses). One-way Analysis of Variance (ANOVA) was also used to examine the differences in the flexibility of the information systems between SME hospitals and hotels. SME hospitals are found to differ from SME hotels in their perception of the format and type of data (Mean SQR difference = 1.101, p=.035) and the diversity of data (Mean SQR difference = 1.276, p=.024) when considering the Hospitel strategy, and the flexibility and frequency of data (Mean SQR difference = .846, p=.026) and the format and type of data (Mean SQR difference = 1.700, p=.005) with the Long Stay strategy. As far as the Homecare Services strategy, the two businesses differ in their views of the diversity of data (Mean SQR difference = .449, p=0.027). Note that hospitals were more concerned than hotels in all areas of flexibility. 4.1.4 Internal/External Factors The most important factor found to influence the alignment of IS with business strategy is Top Management Support. In the combined samples of SME hospitals and SME hotels, 87% responded for top management support, 60% for efficiency of organizational communications, and 66% for the trust among

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manager, developer, and users. The three least influencing factors are Uncertainty of hospitals and hotels technology (29%), the IS personnel cross-over experiences between hospitals/ hotels (44%), and the Rates of specific IS changes in hospital and hotel businesses (47%). Except for the Good working environment factor, hospitals saw more influences for each of these internal and external factors. 4.1.5 Interrelationships among Information System Related Variables and the Viability of Convergent Business Strategies In order to test the inter-relationships as

shown in the study framework, composite measures were calculated from the summary scores of each of the IS related sub-constructs (IS Capability, IS Flexibility, and the Internal/External factors, IS alignment). These composite measures were used in further analyses of the interrelationships between variables. Table 5 shows the Kendall tau-b coefficient matrix of these variables. The composite measures do not show any link between IS Alignment and Viability of overall convergent strategies. Table 5: Kendall Tau-b for Construct Variables (SME Hospitals and SME Hotels, Combined Samples) is about here Also, the Internal/External factors do not relate to the viability of any convergent strategies. However, they relate significantly to the IS Capability and IS Flexibility. The Kendall Tau-b statistics are 0.323 (p=.001) and 0.341 (p=.001), respectively. It appears that the more support and vision provided by management, the more capable and flexible the information systems. However, Kendall Tau-b statistics between IS Alignments and the Viability of each individual convergent strategies are significant at the .05 level, (0.251 (p=.049), 0.267 (p=.030), and 0.255 (p=.046) for Hospitel, Long Stay, and Homecare service strategies,

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respectively), supporting the relationships as depicted in the conceptual framework. SME businesses consistently reported that the more IS alignment, the greater the viability of the strategy. For example, if the IS of the organization is more aligned with the Hospitel strategy, the greater the viability of the Hospitel strategy. All in all, the SME hospitals and SME hotels are quite open to new convergent strategies. They seem to be ready for the strategies even though they only somewhat agree that their information systems would be capable, flexible, and aligned with those strategies. Top management support is seen as the most important factor influencing the relationships between IS alignment and business strategy. External factors relating to the uncertainty of specific business and information technologies are not seen as very influential. Uncontrollable factors such as disease, terrorism, war, and natural disasters do affect the firms choice of strategies. 4.2 POE Hospitals and POE Hotels Public Owned Enterprises in countries like Thailand are supposed to be large, truly owned by the public and have professional management. However, in reality, these companies - especially hospitals and hotels - are not always large. Their ownership is generally concentrated in a few families, or a network of extended family members, and their operations are run by family members who dont always have professional training. Regardless of their professionalism, top management must make important decisions on the type of business strategies and the investment in organizational information systems. Table 6 shows the software packages used in the hospitals and hotels listed in the Stock Exchanges of Thailand. Note that these are large enough hospitals and hotels to be able to invest in locally or foreign developed software packages. The data show that Thai

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hospitals appear to use locally developed packages and Thai hotels more often use internationally known software. The notion that my organization is unique is more apparent in hospitals than hotels. This is probably due to the fact that most of these public hospitals are operated by physicians and family members who are also the majority shareholders, whereas the public hotels are run by professional managers even though some family members also have a very large portion of the shares (Tanlamai et al., 2005). Table 6: Software Packages Used in POE Hospitals and POE Hotels Listed in the Stock Exchanges of Thailand -- is about here Although large hospitals and hotels need to ensure quality and often world-class standards to ease the minds of tourists and travelers, small and medium sized hospitals and hotels in tourist driven societies are no different. Their functional requirements are the same in the areas of reservations, registration, guest history, guest accounting audit, and back office accounting. These smaller organizations are constrained by their ability to invest in IS, and yet their need to use information systems for strategic change is similar to that of larger organizations (Lee & Bose, 2002). Many hospitals have become more proactive they offer value added services to their customers besides their regular caring product line. Hospitals, as well as hotels, are embracing the idea of providing wellness tourism since the younger generations are health fanatics. A specialized and more focused service strategy is believed to give the organizations a competitive survival edge. Many hotels have moved from general to more specialized areas like adventure or training camps. It is expected that in order to make these and similar kinds of strategic decisions, hospitals and hotels have to adjust their operational systems, human resources, and information technology and information systems

24

accordingly. As with any business, niche products and services, as well as new markets, should be identified. One example would be to merge hotel and hospital operations to allow for a Hospitel concept. This would open up a new market segment for both

industries, especially in developing countries where healthcare may not be at its best (Fisher, 1996). 4.3 Convergent Business Strategies and the IS Functions of Hospitals and Hotels Figure 1 shows the functionality of software packages and/or information systems used in hospital and hotel businesses. While the Healthcare Information Systems (HIS) have some similar functions to Property Management Systems (PMS), their major differences lie in specific operations pertaining to a given industry. Besides providing comparisons, these information systems can be minimally modified and developed so as to accommodate the convergent strategies. It appears to be easier to adjust the HIS to accommodate the Hospitel strategy and the PMS to accommodate the Long Stay strategy. As far as the Homecare Service strategy, both software packages can be easily modified. The software can also be modified to take on increasingly popular business opportunities such as alternative healthcare, spas and massages. Figure 1: Functionalities of the Software Packages and Information Systems Used in Hospitals and Hotels is about here 4.4 Cause-Effect Diagram for the Hospital-Hotel Convergent Business Strategies As shown in Figure 2, the cause and effect diagram depicts the factors influencing the viability of the three convergent strategies. In a nutshell, the Human Resource factor is an important service oriented skill that can positively or negatively influence the convergent strategies. Lack of demand has a negative effect on both POE hospitals and

25

POE hotels in embracing the convergent strategies. Except for two major POE hospitals that strategically focus on high-end care and foreign patients, the rest of the POE hospitals have more local demand for patient care than they are able to supply. A tradeoff has to be made between investing in more medical equipment, or renovating the hospital environment to support the convergent strategies described in this study. Figure 2: Cause and Effect Diagram of the Convergent Strategy Implementation -- is about here Although the majority of POEs have adequate computerized information systems to handle their core businesses, additional investments, though minimal, will need to be made so that the systems can be used seamlessly to handle additional services. More investment in facility conversions and service-oriented skill training will need to be taken into account as well. Without lucid demands, most of the POEs are still skeptical of the viability of these strategies.

5. DISCUSSION AND IMPLICATION This study attempts to integrate two bodies of research: information system requirements and strategic management. The study focuses on convergent business strategies within the context of two industries - hospitals and hotels. While it appears that Thai hospitals of all sizes (Small and Medium Sized Enterprises and Public Owned Enterprises) tend to favor the Hospitel strategy, Thai hotels prefer the Long Stay strategy. Homecare Services are not viewed as adding much revenue to either business. Despite governmental support, none of these convergent strategies are prevalent in Thailand. A

26

business strategy like Hospitel appears to be too novel for these two businesses at this time. Very few hospitals and hotels indicated that they had implemented this strategy. The examination of whether information systems alignment will influence these convergent business strategies was inconclusive. While SME hospitals and hotels claimed to implement convergent business strategies, and had fairly capable and flexible information systems that align with these business strategies, the majority of POE hospitals and hotels use software packages which can easily be altered to fit the strategies. The present findings support the proposition that mature industries like hospitals and hotels are likely to take a moderate posture in their technology policy, thus, business strategies and information technology development are not closely aligned (Zahra & Covin, 1993). This is also evidenced in another study that found that SME hospitals and hotels invest the least in IS resources as compared to resources such as marketing, human resources, and physical resources (Tanlamai, 2005). The organizational performance was found to serve as a discriminating variable. Better performing organizations indicated their interest in Hospitel, irregardless of size. This finding is consistent with previous research that better performing organizations tend to favor innovative business strategies (Chamanski & Waago, 2001). The findings show some relationship between internal factors and the viability of convergent business strategies. Similar to previous findings, service industries tend to structure their internal systems (e.g., leadership, management systems, and organization functions) to achieve service performance (Brown & Dev, 1999). For Thai SMEs and POEs, strong leadership and top management support are found to relate to the alignment of the firms information system with its convergent strategies. Also, similar to previous research (Hussin, King, & Cragg, 2002; Navarro et al., 2002), larger hospitals and hotels

27

were more concerned with external management factors. The results of this study find that larger organizations are better able to tolerate greater environment pressures than smaller organizations. Unlike previous research in service oriented industries (De Saa-Perez & GarciaFalcon, 2002) and in the hospital and hotel businesses (Denton & White, 2000), the present findings show less emphasis on a human resource management strategy, particularly from the SME data. Qualitative data from interviews with the POEs, however, convey the opposite. Smaller enterprises in Thailand tend to use family members and friends in their day-to-day operations. Larger enterprises do not have that luxury, and effective human resource management must be maintained. The situation gets more complicated with new technological developments. New skills are required to handle new technology. Although there is plenty of evidence that a technology driven business strategy can pay off (Zahra, 1996), hospitals and hotels in Thailand still have not tuned into the technology strategy, nor do they invest adequately in their information technology. As a result, very few would venture into newer business strategies as their internal processes still need improvement. With the constraint of the present data collection, a true causal relationship cannot be established. Personal connection and trust are necessary in order to obtain information from these organizations. An in-depth case study may produce a better outcome. Future research in the field, particularly in this part of the world, may have to take on more of a qualitative nature with soft conclusions from multiple case studies instead of hard quantitative evidence.

6. CONCLUSION AND FUTURE RESEARCH SUGGESSION

28

With the advent of information technology, businesses are finding themselves in the information business as well as offering their specialized products and services. This includes all the businesses in the healthcare and hospitality industries. Consequently, companies are inevitably taking steps to align their business strategies with their information strategies (Kwei, 1998). The question as to whether business drives

information strategies or information technology drives organizational strategies appears to be less relevant. The fact that gaps exist is normal but they need to be dealt with

effectively. Future research should address a broader issue by questioning whether these gaps will lead to innovation. The majority of Thai hospitals and hotels prefer to invest in traditional strategies and tend to view the strategic question as who is the customer? rather than who is the non-customer? (Nelson, 2005). In his award winning book The Innovators Dilemma, Christensen (1997) argues that a phenomenon called Disruptive Innovation (such as the proliferation of personal computers) can be a major driving force in the success or failure of many organizations. Convergent business strategies, as exemplified in Figure 3, should not disrupt the participating organizations a great deal, and their respective information systems can be made to align with these strategies for reasonable costs. If implemented effectively, these strategies should open up the non-customer segment and allow organizations to survive and grow. Figure 3: Business Strategy Combinations and Their Possible Research Issues Since not every strategy will be appropriate for every organization, IS and organizational researchers might want to find explanations for some of the following questions. What are the factors that cause the IS alignment gap to widen or narrow, and in

29

what contexts do they occur? How applicable is the social dimension of an alignment framework (Reich & Benbasat, 2000) when it is used to measure the Convergent Strategy IT alignment gaps? Should CIOs stop trying to align the IT/IS and business strategies and start taking risks (Sommer, 2005)? What types of convergent business strategies will be more acceptable and productive? At what stage of the life cycle, should an organization begin exploring a convergent business strategy? Is cultural compatibility a hindrance or a facilitator in implementing convergent business strategies?

REFERENCES

30

Table 1: Response Rates of SME and POE Hospitals and Hotels SME SME Firm Size Sampling Response Frame Proportion* SURVEY- SMES SME Hospitals (# of Beds) <=299 52 (21.4%) 11 (22.9%) 300-499 165 (67.9%) 32 (66.7%) >=500 26 (10.7%) 5 (10.4%) Total 243 48 (100.0%) SME Hotels (# of Rooms) <=199 200-499 >=500 Total Firm Size INTERVIEW POES POE Hospitals (# of Beds) <300 300-1000 >1000 Total POE Hotels (# of Rooms) <300 300-1000 >1000 Total 113 (40.6%) 72 (25.9%) 93 (33.5%) 278 POE Sampling Frame 5 5 3 13 7 5 12 15 (53.6%) 6 (21.4%) 7 (25.0%) 28 (100.0%) No of POE Response**

% Responses

11 (21.2%) 32 (19.4%) 5 (19.2%) 48 (19.8%) 15 (13.3%) 6 (8.3%) 7 (7.5%) 28 (10.1%) Comments

1 3 3 7 2 0 2

Confidentiality No such strategies -

Confidentiality Confidentiality

Note: * The proportions of survey responses are a fairly good representation of the sampling frame distribution ** Relatively low response rate many organizations have a corporate policy of confidentiality

Table 2: Viability and Readiness of the Convergent Strategies by SME Hospitals and SME Hotels Business Strategy Total Hospital Hotel % Viability 76 48 28 Hospitel 60 (79%) 42 (88%) (.70) 18 (64%) (.30) Long Stay 63 (83%) 41 (85%) (.65) 22 (79%) (.35) Homecare Service 56 (74%) 40 (83%) (.71) 16 (57%) (.29) Viability at >=80% 34 25 9 Hospitel 16 (26.7%) 12 (28.6%) 4 (22.2%) Long Stay 9 (14.29%) 6 (14.6%) 3 (13.6%) Homecare Service 9 (16.07%) 7 (17.5%) 2 (12.5%) Average % of Viability T-value Mean Mean Hospitel 0.61 48.83 42.72 Long Stay 0.21 35.73 34.00 Homecare Service 2.61* 42.98 19.25 Kendalls tau-b Readiness for Strategy 48 28 (Approx T)# Hospitel -223 (-1.907) 43 (90%) 20 (71%) Long Stay .385 (3.86)*** 43 (90%) 23 (82%) Homecare Service -.401 (-3.421)*** 47 (98%) 13 (46%)
Note: ***p<=.001, **p<=0.01, *p<=0.05

Table 3: Mean and Standard Deviation of the Rating of IS Alignment toward Convergent Business Strategy (%) for SME Hospitals and SME Hotels IS Alignment Hospitals 61.1, 25.8 (36) Skills of IS personnel equipped 60.7, 25.8 to deal with strategy (36) IS unit aligning with the 58.5, 24.0 organizational structure (36) IS strategy aligning with 51.9, 24.6 organizational strategy (36) IS objectives lined up with the 55.6, 23.6 convergent business strategy (35) IS gearing up to strategy
Note:
a b

Hospitel Hotels 75.6, 15.1 (9) 72.8, 19.5 (9) 63.0, 30.2 (10) 71.3, 15.5 (8) 75.6, 17.6 (8)

Total 64.0, 24.6 (45) 63.1, 24.1 (45) 59.5, 25.3 (46) 55.5, 24.3 (44) 59.3, 23.7 (43)

Convergent Business Strategy a Long Stay Hospitals Hotels Total 49.0, 34.5 52.7, 26.5 50.6, 30.9 (15) (11) (26) 51.3, 31.8 52.5, 25.3 51.9, 28.6 (15) (12) (27) 48.0, 28.8 45.0, 27.1 46.7, 27.6 (15) (12) (27) 41.7, 25.0 51.8, 25.2 46.0, 25.1 (15) (11) (26) 47.3, 28.4 50.9, 28.8 48.9, 28.0 (15) (11) (26)

Homecare Service Hospitals Hotels Total 51.7, 28.7 0 51.7, 28.7 (18) (18) 51.3, 26.8 54.1, 28.5 (16) (1)b (17) 48.7, 25.0 0 48.8, 25.0 (15) (15) 44.0, 25.3 0 44.0, 25.3 (15) (15) 48.1, 24.3 65.0, 49.5 50.0, 26.3 (16) (2) (18)

Each cell contains the Mean (Average percent of alignment between the firms IS and the convergent strategy), Standard deviation, (No of Responses) Only one response from hotel, thus the mean and standard deviation cannot be calculated, the % rated by this respondent is 100%

Table 4: One-way ANOVA a of the IS Alignment and Convergent Strategy (SME Hospitals and SME Hotels, Combined Samples) Convergent Business Strategy IS Alignment Hospitel Long Stay Homecare Services IS gearing up to strategy 3.338, 24.469*** 0.264, 1.060 2.908, 17.400*** Skills of IS personnel equipped to deal with 3.716, 27.108*** 0.364, 1.462 1.872, 10.629** strategy IS unit aligning with the 3.716, 27.108*** 0.364, 1.462 2.081, 13.299** organizational structure IS strategy aligning with 4.012, 30.134*** 0.264, 1.060 2.019, 12.688** organizational strategy IS objectives lined up with the convergent business 3.641, 24.723*** 0.264, 1.060 1.355, 6.986* strategy Difference on the average 88.666, 26.679*** 6.986, 1.140 47.790, 12.246***
Note: Each cell contains the Mean Square Difference of Between Groups (Combined Samples of the SME hospitals versus SME hotels) that chose/ did not choose the strategy, F-statistics (***p<=.001, **p<=0.01, *p<=0.05)
a

Table 5: Kendall Tau-b for Construct Variables a (SME Hospitals and SME Hotels, Combined Samples) Combined Strategy X, SD 1 2 1. Capability of IS b 64.2, 28.0 1 2. Internal/ External Factors e 56.1, 22.7 0.323** 1 c 3. Flexibility of IS to Strategy 88.7, 19.9 0.190 0.341** 4. Alignment of IS to Strategy d 48.6, 27.8 -0.103 0.068 f 5.Viability of Convergent Strategy 38.5, 24.5 0.002 0.061 Hospitel Strategy 1 2 1. Capability of IS 64.2, 28.0 1 2. Internal/ External Factors 56.1, 22.7 0.323** 1 3.1 Flexibility of IS to Hospitel 51.5, 41.1 0.028 0.213** 4.1 Alignment of IS to Hospitel 74.2, 43.8 0.047 0.164 5.1 Viability of Hospitel 47.0, 33.8 0.095 0.023 Long Stay Strategy 1 2 1. Capability of IS 64.2, 28.0 1 2. Internal/ External Factors 56.1, 22.7 0.323** 1 3.2 Flexibility of IS to Long Stay 25.1, 37.8 0.238 0.119 4.2 Alignment of IS to Long Stay 43.4, 49.6 -0.048 -0.035 5.2 Viability of Long Stay 35.1, 29.9 0.06 -0.066 Homecare Service Strategy 1 2 1. Capability of IS 64.2, 28.0 1 2. Internal/ External Factors 56.1, 22.7 0.323** 1 3.3 Flexibility of IS to Homecare 9.5, 22.4 0.129 0.145 4.3 Alignment of IS to Homecare 28.1, 43.2 -0.114 -0.010 5.3 Viability of Homecare 36.2, 31.5 0.08 -0.010
Note: a ***p<=.001, **p<=.01, *p<=.05 b % of average combined responses choosing IS capability characteristics c % of average combined responses choosing IS flexibility features d % of average combined responses choosing IS alignment aspects e % of average combined responses choosing Internal/ External factors f Average percentages of the perceived viability of convergent strategies

0.237 -0.047 3 1 0.641** 0.012 3

0.130 4

1 0.251* 4

0.508** 0.304** 3 1 0.423** 0.196

0.267* 4

1 0.255*

Table 6: Software Packages Used in POE Hospitals and POE Hotels Listed in the Stock Exchanges of Thailand
ID AHC BGH BH KDH LNH M-CHAI NEW NTV PYT RAM SKR SVH VIBHA ID ASIA CENTEL POE Hospitals Aikchol Hospital Bangkok Dusit Medical Services Bumrungrad Hospital Krungdhon Hospital Chiang Mai Medical Services Mahachai Hospital Wattana Karnpaet Nonthavej Hospital Prasit Pattana Ramkhamheang Hospital Sikarin Samitivej Vibhavadi Medical Center POE Hotel Asia Hotel Central Plaza Hotel No of Beds 155 2,595 554 400 180 500 100 280 1,050 2,400 180 675 550 No of Rooms 1,383 1,662 # of Years Established 26 35 29 27 29 17 19 25 30 18 25 28 18 # of Years Established 38 24 Software Package SSB (Thai origin)* MedTrak (Brazilian origin)** Global Care Solutions (Thai origin)*** iMed Software (Thai origin)**** In-house, customized software In-house, customized software SSB for Front Office Use local Payroll program called Express SSB with some customized software MedTrak in one site and SSB in the other two sites In-house, customized software for the Front Office and Micron Care for Back office In-house, customized software for the Front Office and SSB for Back office Med Trak HIS-BIT (Korean origin) Software Package *****

HIS Software HIS Software Front Office -- OPERA Enterprise Solution (OES) from the Micros Fidelio family (US DTC Dusit Thani 2,368 38 origin) Accounting Software -- Navision IHG The New Imperial Hotel 2,617 31 Comache (Thai software) LRH Laguna Resort & Hotels 944 11 Micros Fidelio MANRIN The Mandarin Hotel 556 39 Comache The Oriental Hotel Front Office -- Micros Fidelio OHTL 393 128 (Thailand) Back Office Software from the Sun Systems PA Pacific Assets 652 16 Front / Black Office - Micros Fidelio Front/Back Office Fidelio; Four Season RHC Rajadamri Hotel 356 31 Forecast Inherence, Report_Financial Hyperion Front Office Fidelio RGR Royal Garden Resort 2,035 26 Back Office -- JD Edwards Royal Orchid Hotel Front Office -- Micros Fidelio ROH 772 21 (Thailand) Back Office -- Platinum Front Office -- Micros Fidelio SHANG Shangri-la Hotel 850 23 Back Office -- Platinum Note: * SSB is one of the most popular and locally developed software packages for hospital information systems ** MedTrak is implemented by a very large group of hospitals, thus, becoming more well known in Thailand *** Global Care Solutions is a successful local turns global hospital information system **** iMed software is a local software package developed using the Thailand Research Funds ***** Most of the software packages used in hotels are large and of US origin (e.g., HIS and Micros Fidelio). Comache is one of the most popular Thai developed software packages.

Figure 1: Functionalities of the Software Packages and Information Systems Used in Hospitals and Hotels

Figure 2: Cause and Effect Diagram of the Convergent Strategy Implementation

Note: The diagram shows that three positive major factors and one negative major factor that were identified from the in-depth interviews to influence the viability of the Convergent Business Strategies. These major factors are represented by the square boxes. Other subordinate issues are shown by the arrows with the notations, Pos for positive and Neg for negative relationships between the linking factors/issues. The present cause-effect diagram can serve as a preliminary analysis of the relationships between information systems alignment and convergent business strategy in the Thai hospital and hotel context.

38

Figure 3: Business Strategy Combinations and Their Possible Research Issues

Business Life Cycle

Service
Insurances - Publishing

Retailers Real Estates /Building

Internal Control

Manufacturer

KPI

Information systems

Con v ergen t B u sin ess St r at egy

Information Systems

Food & Beverage - Pharmaceutical

KPI

Internal Control

Service
start growth

Restaurants Wood & Furniture

Manufacturer

mature

decline

39

Appendix A Survey Instruments for SME Hospitals and SME Hotels

1.1 Check the most appropriate characteristics of your customers. Proportion In-patient : Out-patient Tourists : Business Customers Local : Foreigner Customers 1.2 Identify two major competitors that might use the business strategies such as Hospitel, Long Stay, and Homecare Services. Major Competitor 1 2 2.1 Using the scale, 0-100%, rate the viability of each of the following business strategies. Hospitel (hospital with hotel facility and services and vise versa) Long Stay Homecare Services
viability 0:100 <=5:>=95 10:90 20:80 30:70 40:60 50:50

Hospitel

Long Stay

Homecare Services

0%______ _____________|______________ _____100%

viability viability

0%______ _____________|______________ _____100% 0%______ _____________|______________ _____100%

2.2 When does the strategy be implemented, if any? Business Strategy Hospitel Long Stay Homecare Services Others, please specify 3.1 Do your organization information systems support business strategies? Yes No Specify _______________________ 3.2 What indicators are used to assess the efficiency and effectiveness of your organizational information systems? This question is only included in the in-depth interviews. 3.3 To what extent does the information produced help management with strategic decision? This question is only included in the in-depth interviews. Already in place Can start immediatel y In 2-3 years In several years Never

4.1 Please check the information characteristics produced by your organizational IS. How do they help the management in each of the following areas? (Check as many as applicable)

Information Information Information Information Information Information Information

that that that that that that that

helps helps helps helps helps helps helps

management in making quick decision. management in pacing their decision appropriately. management in making the decision correctly. management in reducing a risky decision. management to be able to evaluate alternatives simultaneously. the integration of different concepts form different operational levels. management in making systematic decision

4.2 How flexible are your organizations information systems in the implementation of a new business strategy? Homecare Hospitel Long Stay Flexibility of IS Business Strategy Services Adaptive to strategic change Flexible and frequent data availability Flexible format and type of data for decision making Diversity of data Quick change of IS personnel and staff 5. Check the internal/External factors that might influence the resources and capabilities of your organizational information systems (check as many answers as applicable)

Top management support Good working relationships Strong leadership

Appropriate prioritization for systems development Trusts among management, systems developers, and users

Efficient communications within the organization Volatile technological environments of hospital and hotel businesses The pace of changes of the information systems development IS unit has business experiences of specific to the organization or a compatible businesses such as other hospitals/hotels, mobile healthcare units, and catering services IS Unit has a good understanding of business requirements

6. Check and rate from the scores of 0-100% for the alignment between organizational information systems and the implementation of business strategies. Viability of the organizational information systems

Hospitel _______ % _______ % _______ % _______ %

Long Stay _______ % _______ % _______ % _______ %

Homecare Services _______% _______% _______% _______%

Readiness of the existing information systems Capable, skilled information system staff Alignment of information system unit within the organizational structure Alignment of the strategic planning of information systems

Organizational information systems have strategic alignment with organizational goals and objectives

_______ %

_______ %

_______%