This dissertation reports an empirical investigation of the relationship between an organization's economic orientation (i.e., whether it is a profit or not-for—pr0fit organization) and its strategy as operationalized in its goals, goal structure, power structure, and goal setting process. The comparative analysis of these fundamental strategic elements in actual profit and nonprofit organizations is viewed as a necessary prerequisite to the understanding of the strategic management process in what has traditionally been referred to as the not-for-profit sector. Based upon a review of the current literature, three multiple hypotheses were formulated to guide the research. These hypotheses related to whether or not organizations which use the same basic technology and are of the same general size, but which profess to have different economic orientations,: (1) establish different strategies to guide their operations; (2) exhibit different power relationships among those who are involved in making these strategic decisions; and (3) utilize different processes for making these strategic decisions. The data needed to test the research hypotheses were obtained from surveys of and interviews with the top level decision makers in three proprietary (for-profit) and five not-for-profit hospitals located in the states of Virginia, West Virginia, and North Carolina. Only short-term, nongovernment, nonreligious, nonteaching, general hospitals were studied in order to increase the homogeneity of the sample. Various problems associated with the identification of the sample and the methodology employed to collect the data are discussed and the research instruments used are included as appendices. Because of the exploratory nature of this research, the inherent limitations of the methodology which was used, and the small sample size, the reader is cautioned against generalizing the findings and conclusions reported here to organizations not specifically examined as part of this study. A measure of the overall strategy of each organization was obtained using a mail questionnaire which asked its top level decision makers to evaluate the importance of 56 goal statements that were viewed as relevant for hospitals. The mean responses to all goal statements were in turn rank ordered for each economic orientation to obtain its particular goal structure. The power structure for each economic orientation was developed in a similar manner by having the respondents evaluate the amount of influence which 27 potential power holders might be able to exert with regard to his or her organization's goal setting process. Both the mail questionnaire and personal interviews with the administrators of each hospital were used to provide data about the particular goal setting process of each institution. Statistical analysis of the resultant data led to the following conclusions. First, no significant differences were observed between the goals and goal structures of the proprietary and not-for-profit hospitals surveyed in this study. Second, no significant differences were observed in the power structures of the proprietary and not-for-profit hospitals surveyed in this study. Third, there may be some inherent differences between the goal setting processes used by the proprietary and not-for-profit hospitals surveyed in this study, although the exact nature of these differences cannot be clearly determined from this research alone. Fourth, the generally high internal reliabilities of the six goal area constructs employed here to examine specific types of related goals indicated that they were appropriate for use in this study and the ability to increase these reliabilities even further indicates that they may prove to be of additional value in future investigations of this type. Finally, the minimal amount of support for the research hypotheses which was observed in the data analyzed here failed to provide an empirical basis for the argument that there are fundamental differences in the strategic management processes of profit and not·for-profit organizations

Ph. D.