Medical tourism clusters are not in the right league

Over a series of two articles, Constantine Constantinides of Healthcare Cybernetics, gives his view on how health tourism clusters need stronger, more systematically organised leadership.

For quite some time, I have seen a trend to label a collection of health tourism providers in either an established or emerging destination as a ‘cluster’.

Those behind this labelling and promotion may not have read up on industry clusters, as introduced and popularised by the well-known Harvard Business school academic Michael Porter. Also known as ‘Porterian’ clusters, these were described by Porter in “The Competitive Advantage of Nations” (1990), and their definition is to do with geographical economics. The importance of geographical economics was also brought to our attention in the same decade by Paul Krugman in “Geography and Trade”.

According to these established views, an industry cluster is a geographical location (i.e. place) where there are enough resources and competencies to reach a critical threshold. Threshold achieved, the location then has an advantageous position over other geographic places in a given economic sector (think, for example, of Hollywood and Silicon Valley in the US).

A Porterian cluster is therefore a place, and not a group of ‘same’ businesses. So in the case of medical tourism, a collection of hospitals or dental clinics can’t justifiably be an effective cluster.

‘Ersatz’ clusters

I’ve long had an interest in clusters and Michael Porter’s models. I’ve accumulated enough supporting arguments to persuade me of the merits and superiority of applying this approach in the context of health tourism.

But with the passage of time and the evolution of the health and medical tourism sector, clusters have begun to lose their practical relevance, lustre and credibility. This was not least because, for the most part, they were inappropriately conceived, structured, purposed and led. They have been, in my mind, ‘ersatz’ clusters – in other words inferior imitations of the real Porterian thing.

Furthermore, there has been a blurred line (or indeed no line) between what it is to be a medical tourism association, council or cluster. And to compound the problem, these ersatz groups have generally not been led by ‘real leadership’ (essentially providing direction and setting an example for others to follow; something I have written quite a bit about).

Systematic creation of a destination

No matter how good the providers or facilities are, the health tourism or medical tourism selection process starts with the choice of destination.

In the absence of an integrated, efficient, well-known, attractive, credible and trusted health tourism destination, providers (even the very best) should not expect much in the way of international patient business.

Too often, I find those leading ‘destination level’ initiatives limit their efforts to broad-brush promotion. They forget about (or are oblivious of) the other required parallel concerted actions (i.e., segmentation, integration, administration and development) required to systemically create a destination.

This realisation has led me to encourage the creation of health tourism destinations, organised according to a systematic “Health Tourism Pentad” approach and administered by what I call ‘Destination Management Organisations’.

Essentially, this is about shifting medical tourism clusters from amateurism to professionalism.