This paper reports on part of a comparative study of health services planning in Ireland and in Canada. How can the strategic management of the Irish health services in the form of service planning be implemented? The focus of this paper is the identification of two key stumbling blocks to success in this endeavour. These include the limitations of the control mechanism, the legislation, underpinning service planning and the lack of recognition of the complexity of the healthcare environment and the stakeholders within it, in attempting to introduce service planning as a means of strategic management and change. The Irish research is shadowed by a case study in Canada. This paper reports on the Canadian experience of public participation in planning, to align goals and targets with identified health needs in the population. In comparison to the Irish context, the Canadian planning system takes a two pronged approach; a population health planning approach at the corporate strategic level and multiple stakeholder involvement which is protected by legislation, feeding into this system on an annual basis.

This paper reports on a study of policy and planning in the health care sector. It considers the ambiguity of a health care strategy crafted to underpin such planning in service delivery and espousing the principles of ‘people centredness’ and ‘equity’, and policy implementation on the ground. The paper also draws on the Canadian experience as a comparator, where the pursuit of citizen-centred policy, has stimulated innovative approaches to the organizational design of governments’ service delivery systems (Flumian, Coe & Kernaghan 2007).

The choice was made to study the dynamics of this policy implementation at a local level by examining a number of health boards in both the Irish and Canadian contexts, as well as accounting for the wider institutional influences; the environment in which those cases were situated. This wider view included looking at other stakeholder perspectives, including government and other health care organisations in the health care system, and examining the legislative influence.

This study highlights a number of issues. First, the limits of the control system; the legislation itself, in aligning government policy aims with the planning process, and, second, the lack of recognition of the complexity of the healthcare environment and the stakeholders within it, in attempting to implement policy. This paper posits explanations for the difficulty in aligning strategy and planning in Irish health care after over a decade of service planning.

This study in examining the function and implementation of the service plan in the Irish health care system drew comparisons with the Canadian experience. A multiple case study design was utilised. Key research questions were tested through analysis of legislation and documentation as well as qualitative interviews with middle and senior management throughout the health care system. The choice was made to study the dynamics of strategic change in their setting by investigating a number of health boards during 2004-2005. The focal points of analysis were structured around three cases in the Irish context and one case in the Canadian context, as well as accounting for the wider institutional influences; the context in which those cases were situated. This wider view included looking at other stakeholder perspectives, including government and other health care organisations in the health care system, and examining the legislative influence.

The study narrowed down the conceptual framework to a number of key problems with the Irish experience. The implications for practice derived from the case analysis are presented.

Interesting insights into subsidiary behaviour and specifically into the strategy development styles of subsidiaries are obtained.

The extension of strategic entrepreneurship across the multinational organisation to include its dispersed subsidiaries is intuitively appealing but at present there is a deficit of entrepreneurial theory at any organisational level (Brown, Davidsson and Wiklund, 2001; Sexton and Landstrom, 2000). This study contributes to theory development in this area by integrating aspects of strategic management and entrepreneurial theory at the subsidiary level of analysis. Strategic or entrepreneurial posture, as described by Miles, Covin and Heely (2001, pp. 65) ‘is demonstrated by the extent to which top managers are inclined to take business-related risks, to favour change and innovation in order to obtain a competitive advantage….and to aggressively compete’. Combining the strategic literature in relation to studies on subsidiary role and initiative generation with the entrepreneurship theory on firm level innovation and performance, it is proposed that several contextual factors, including aspects of the parent / subsidiary relationship influence subsidiary entrepreneurial posture. A range of variables representing subsidiary context, which have not been previously assessed from this perspective are examined. In addition, a new measure to capture the influence of the internal MNC market on subsidiary behaviour is created.

The emerging dynamic capabilities perspective argues that in turbulent environments it is the adaption and modification of capabilities which fuels competitive advantage (Teece, 2007; Teece and Pisano, 1994; Teece, Pisano and Shuen, 1997). Indeed it is widely argued that what differentiates one organisation from another is largely determined by their resources and how they implement and utilize them (Wernerfelt, 1984; Barney, 1991, 1995; Peteraf, 1993). It is now emerging, however, that to meet the exacerbating challenges of fast moving, globally competitive markets, organisations need unique and difficult to replicate dynamic capabilities. This progression in theory aims to overcome the static nature of the resource based view (Mahoney and Pandian, 1992; Priem and Butler, 2001a; 2001b) and addresses the causal questions of how organizations can „continuously create, extend, upgrade, protect and keep relevant the enterprise‟s unique asset base‟ (Teece 2007, p. 1319).

This paper argues that whilst the dynamic capabilities perspective is useful and congruous to change it falls short when applied to subsidiary theory; limiting its applicability to theory and practice in this domain. The subsidiary context is a complex one; characterised by the need for alignment with headquarter driven objectives on one hand, and the need for responsiveness on the other (Scott, Gibbons and Coughlan, 2010) The scope for subsidiary adaption is largely contingent upon headquarter approval and controls in which case subsidiary management may affectively find their hands tied in pursuing adaptive strategies. The agency problem therefore raises some serious concerns over the applicability of the dynamic capability perspective in a subsidiary context. Juggling the competing goals of alignment and adaption reflects a real challenge for subsidiary management. The dynamic capabilities framework fulfills only the responsiveness dimension essentially ignoring crucial aspects of alignment.

This paper proposes looking at the other side of the coin in examining how mechanisms which allow for greater alignment can impact upon the subsidiaries capacity to be adaptive. It is argued that the subsidiaries capacity to gain access to resources and leverage their position will be largely contingent upon the space they occupy within the MNC network. This dual structure of alignment and adaption, and the combinative approach taken in this paper, has been referred to as ambidexterity (Duncan, 1976; Gibson and Birkinshaw, 2004).

Using a multiple case study of ICT subsidiaries we uncover how these subsidiaries navigate and negotiate internal MNC environments in positioning for growth. Our findings illustrate an emerging Pilot or lead user subsidiary role; one that is largely mis-aligned from general strategy yet a continuously shifting source of value for the organization. Pilot subsidiaries avoided direct cost competition with sister subsidiaries, opting instead to continuously develop capabilities which could then be diffused to low cost counterparts within the collective organization. The disposal or surrendering of capabilities and activities served a dual purpose; firstly it allowed the subsidiary the physical space to adopt new value add activities, to keep abreast of technological change and to renew its position as Pilot. Secondly, by offloading activities to more commoditized players within the network the subsidiary was able to maintain their network position relative to internal competitors.