External environment of health care involve factors outside the organization that influence the healthcare facility. When there is strategic planning in an organization, the external factors have to be considered before making the final decision, if the negative impacts exceed the positive one then the organizers have to find a way of reducing the effects or discontinue the plan. As in the given scenario, the CEO must review the external factors, their impacts, and recommendation to make a decision. The factors to consider are discussed below together with recommendations.

•    Policies and economics.

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 If the hospital has adequate amount of capital that will be able to improve their equipment to the required status and also accommodate the number of patients as they expect a future increment in number, then the CEO approves the project (Wang et al., 2012). The economic development of the area also matters a lot, infrastructure leading to the hospital may act as a determinant factor on the decision of patients to visit the facility or not. Good roads motivate patients to visit hospitals, while roads with potholes discourage patients.

•    Laws and ethics

 The hospital meets the ethical regulations as presented by WHO. The hospital must operate within the requirement of the government, and failure may lead to closure. The law specifies requirement s needed for a facility to attain Magnet status. Therefore the hospital is keenly inspected to be given approval. This means that there is an analysis of every department first before certification. If the ethical values of the hospital are at the desired state, then the CEO can approve the project.

•    Health care quality

The value of health care provided in a hospital matter a lot in terms of competition and patient choice. If the hospital will provide higher health care quality compared to others, there is an assurance of an increasing number of patients with time. If the care provided will be poor, then there will be fewer patients which indicate a failure in planning, hence lose in terms of money invested.

•    Population health

The CEO in this scenario must consider the means of enhancing the health condition of people living within the hospital’s geographical area. How will the plan affect the lives of these people, will it improves or deteriorate their health? If the planning tends to improve the health of the target population, then approval is considered, and if it has a negative impact, then the CEO should consider disapproval (Mason, 2007). An example of a negative result is a case where, due to an increased number of patients with different illness, there might be cases of increased infection in the surrounding region hence rising cases of diseases.


•    Improve the working conditions of the employees.

•    Adherence to laws and ethics

•    Provide high health care quality

•    Improve the infection control strategies

•    Employ more qualified staffs

•    Prioritize population health

A review of the impacts of the external environment helps will help the CEO have a clear picture of the effects of the project at hand (Mason, 2007). This helps to come up with better ways of proceeding with the project as well as dealing with the negative impacts foreseen to limit their influence. By improving the working conditions of employees, it will motivate them to work even harder and provide quality services. There is an assurance of operating smoothly with no government interference when following laws. The CEO should give a conclusion that favors those who opposes and proposers and at the same time, favors the affected population together with the organization.


Mason, R. B. (2007). The external environment’s effect on management and strategy: a complexity theory approach. Management decision, 45(1), 10-28.Wang, C. H., Chen, K. Y., & Chen, S. C. (2012). Total quality management, market orientation and hotel performance: The moderating effects of external environmental factors. International Journal of Hospitality Management, 31(1), 119-129.

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