Entrepreneurship and Innovation among GP Fundholders:
Some Preliminary Evidence

By
Christine Ennew
David Whynes
Teresa Feighan

Paper for EBB Conference August 1995
Draft
Please do not quote without permission


School of Management & Finance/Dept of Economics
University of Nottingham
Nottingham
NG7 2RD
Tel: 0115 951 5259
Fax: 0115 951 5262

Entrepreneurship and Innovation among GP Fundholders: Some Preliminary Evidence

Abstract

The introduction of quasi markets into the public sector suggests that the concept of entrepreneurship may have an increasing role to play within the resulting new organizational forms. The nature of public sector entrepreneurship is examined in the context of the new arrangements for the provision of primary care in the UK. The changes to the GP contract and the introduction of fundholding provide GPs with the opportunity to take enhanced responsibility for the provision of care to their patients; this enhanced responsibility could, in principle, place the GP in the role of an entrepreneur. Since fundholding in particular provides considerable autonomy, the scope for entrepreneurial behaviour may be greater among fundholders than among non-fundholders. Interview evidence suggests that there are differing forms of entrepreneurship in evidence among fundholders, including the reduction of organisational slack (Leibenstein), price-quality arbitrage (Austrian) and innovation (Schumpeter). Statistical analysis indicates that there may be distinct groups of GPs who differ in their entrepreneurial attitudes and beliefs and there is some tentative evidence to suggest that these differences are reflected in behaviour.

1 Introduction

Entrepreneurship has traditionally been associated with the activities of individuals operating within the private sector. Increasingly there is evidence to suggest that the concept and practice of entrepreneurship has a role to play in public sector organisations, particularly as governments are encouraging those organisations to become more market oriented. In the UK, where privatization has been deemed inappropriate, reform of the public sector has concentrated primarily on the development of quasi-markets. The term quasi-market is used to describe a market arrangement in which the State funds certain activities but no longer acts as the provider of those activities. Instead the State or its agents purchase public services on behalf of consumers from a range of different providers. In the primary care sector, the quasi market has been created through the introduction of fundholding which presents general practitioners (GPs) with a budget which is controlled and allocated by them for the provision of types of primary care and the purchase of a range of forms of secondary care. In principle, the scheme gives general practitioners (GPs) responsibility for determining the allocation of resources in relation to the type, quantity and quality of care provided. Accordingly, it can be argued that the fundholding reforms create the opportunity for and require entrepreneurial activity on the part of general practitioners. The paper is concerned with an investigation of the meaning and nature of entrepreneurial activity in this context.

The paper proceeds first by examining briefly the reform of primary health care provision in the UK. Thereafter, we explore the links between markets, quasi markets and entrepreneurial activity in order to develop an understanding of the concept of the public sector entrepreneur. The following sections outline the data collection process and present the results of the analysis. The paper concludes with a with a discussion of the implications of the results.

2 Quasi-Markets and the Reform of Primary Health Care

In common with the reform of the public sector in general, the National Health Service (NHS) reforms in the UK have been instituted with the intention of creating an operating environment which, although not a true free market, possesses many of the characteristics of a free market. The basic philosophy underlying these reforms was that the introduction of quasi markets would provide the basis for enhanced service quality, improvements in efficiency and increased patient choice (Ham, 1994). For a quasi market in health care to operate required the separation of purchaser and provider (LeGrand, 1991). This was largely to be achieved through a respecification of the role of the District Health Authority and the creation of self governing trusts as explained in Working for Patients (DoH, 1989b). However, the General Practice White Paper (DoH, 1989a) added an additional dimension to the purchasing side through the introduction of the Practice Budget Scheme (commonly referred to as fundholding) which allowed GPs to hold their own budgets and manage their available resources in order to more fully meet the needs of their patients. It is evident that the intention of fundholding was to confer enhanced market power upon the individual practice (in securing secondary care), whilst at the same time requiring that practice to subject itself to the financial discipline of a predetermined budget (Whynes and Reed, 1993).

These changes in the operating environment are expected to directly affect individuals within the NHS, encouraging the types of behaviour which would be consistent with an unregulated market (Ferlie, 1992). In general, it has been argued that the introduction of private sector models into the public sector will encourage the replacement of the existing administrative and professional cultures with more market oriented and entrepreneurial cultures (Stewart and Walsh, 1992). In the case of primary care, the Practice Budget Scheme delegated responsibility to GPs to purchase a defined range of services on behalf of their patients. GPs who participated received a budget to cover a range of hospital procedures, prescribing costs and practice staff and considerable autonomy with respect to expenditure and purchasing decisions. In many senses, it can be argued that the reforms to general practice budget scheme created the opportunity for GPs to adopt a much more entrepreneurial role in the provision of primary care.

That the introduction of fundholding represented a major economic and managerial change for GPs is incontrovertible. Already, the impact of fundholding has attracted considerable comment and a growing body of research. Anecdotal evidence of both the costs and benefits of fundholding is provided by Bain (1993) and McAvoy (1993) who both note that patients of fundholding practices have experienced improvements in service quality but equally, both recognise that this has imposed costs on patients in non-fundholding practices. Chambers and Belcher (1993) comment on the increased workload imposed on GPs as a consequence of the NHS reforms more generally. However, as Newton et al (1993) observe, it is still too early to fully assess the true impact of the scheme. Much of this research, conducted in the infancy of fundholding provides valuable preliminary evidence but typically lacks a clear theoretical framework. The concept of the entrepreneur and entrepreneurial behaviour provides a theoretical and conceptual basis which can be used to shed further light on the impact of fundholding and contribute to theoretical and empirical developments relating to entrepreneurship in the public sector.

3 Entrepreneurship in the Public Sector

The introduction of fundholding arguably puts the GP in a position which is akin to that of an entrepreneur. The term entrepreneur has been used to describe not only the fundholding GP (Bain, 1993), but also Headmasters in schools as a consequence of educational reform (Boyett and Finlay, 1992) and business managers in hospital trusts (Boyett and Finlay, 1994). More generally, the climate created by the recent public sector reforms has been described as entrepreneurial (Stewart and Walsh, 1992). However, the concept of the entrepreneur in the private sector continues to be imprecise and the subject of considerable debate (Chell et al, 1991); the concept of entrepreneurship in relation to the public sector, even more so. Nevertheless there appears to be a widespread agreement that entrepreneurship is relevant outside the private sector (Gartner, 1990; Schultz, 1975, 1980) and it can be argued that when the public sector is characterised by quasi markets, the concept of entrepreneurship is likely to be particularly relevant. Arguably, if markets need entrepreneurs in order to function effectively (Baumol, 1968) then quasi-markets will also require individuals who fulfil a similar type of role.

However, this begs an obvious question about the nature of entrepreneurship in the public sector given the absence of the profit motive, lack of ownership and other private sector characteristics which condition entrepreneurial activity. However there are many different concepts of the entrepreneur. Schumpeter (1934), for example, sees the entrepreneur as having a decision-making role and his/her main function is to innovate (i.e., introduce new goods; introduce new methods of production; open new markets; conquest new supplies; create new types of industrial organisation). Indeed the Schumpeterian view essentially emphasises the idea of the entrepreneur as a source of disequilibrium. By contrast, the Austrian School (eg Kirzner, Hayek) focus on the idea of the entrepreneur as arbitrageur and emphasise his/her role in seeking to move a system back towards equilibrium. While apparently diametrically opposed, these two concepts are by no means inconsistent and may simply recognise the fact that the role and activities of the entrepreneur may be context specific (Cheah, 1990). Leibenstien (1968) regards the entrepreneur as someone who achieves success by avoiding the inefficiencies to which other people (or the organisation to which he/she belongs) are prone. A common element in many of the definitions of the entrepreneur is that the entrepreneur is not defined as a bearer of risk but rather someone dealing with the problems created by uncertainty (Chell et al, 1991).

Casson (1982) attempts to identify a shared element that runs through these theories by introducing the concept of entrepreneurial judgement. The attempt to identify a shared element suggests that Casson's theory has generality, and may be applied to all kinds of entrepreneurship. Casson (1982, p.23) specifically defines an entrepreneur as someone who specialises in taking judgemental decisions about the co-ordination of scarce resources. In Casson's view the concept of entrepreneurial judgement is of paramount importance; judgement is not based on the simple application of marginalist rules regarding resource allocation but rather is based on individuals, their perceptions and the information that they have available (or choose to acquire). Central to this concept is the recognition that different individuals will make different decisions which will produce different outcomes because information is necessarily imperfect and costly to acquire.

Much attention has been focused on defining the nature of entrepreneurship; rather less attention has been devoted to understanding why and how entrepreneurial activity occurs. However, it is generally thought that as the pace of economic change increases, the need for entrepreneurs becomes that much greater (Casson, 1982, Schultz, 1975) because of increased uncertainty and the increased complexity of resource allocation decisions. Bull and Willard (1993) suggest a more general framework in which entrepreneurial activity is stimulated by the presence of four factors, namely task related motivation, expertise, personal gain and a supportive environment. Task related motivation reflects the dedication to a goal that characterises so many entrepreneurs. Specifically, Bull and Willard define it as 'some vision or sense of social value embedded in the basic task itself' (p188) and a key feature of this construct is that it extends beyond the simple notion of gain or profit maximisation. However, personal gain is not irrelevant; the potential for personal gain (financial or non-financial) is recognised as a significant influence on entrepreneurial activity. Both task related motivation and expectation of gain can be regarded as factors pulling individuals towards entrepreneurial activity. The remaining two factors in the Bull and Willard framework are closer to push factors. Expertise is concerned with the potential entrepreneur having the necessary knowledge and skills or being confident about their ability to gain these skills in the future. The construct of a supportive environment refers to the various external factors which facilitate the entrepreneurial process and would include factors such as support networks, favourable economic conditions, appropriate institutional structures and government policy and regulation. Favourable combinations of these push and pull factors can be thought of as antecedents to entrepreneurial activity.

Implicit in much of the preceding discussion is the assumption that individuals are or are not entrepreneurs. In practice, there are degrees of entrepreneurship and different types of entrepreneur. There is an extensive body of literature dealing with typologies and characteristics of entrepreneurs (Ennew, Robbie, Wright and Thompson, 1993; Lafuente and Salas, 1989; Woo, Cooper and Dunkleberg, 1991). A common theme in this work is the idea of two basic entrepreneurial types - the craftsman and the opportunist. The former is typically motivated by the desire for autonomy and the wish to concentrate doing the type of work he or she likes. The latter by contrast is more managerial in orientation, motivated by profit and the desire to exercise control and power. Both groups can be considered as entrepreneurs but their different motivations and expectations may be expected to result in differing patterns of behaviour.

The general practitioner managing a practice budget and making decisions relating to the purchase and provision of health care can potentially be classified as an entrepreneur in terms of Casson's broad definition. Given an allocated budget, the fund holding GP must make judgemental decisions regarding the provision of services and although these decisions are not necessarily profit motivated, they may be viewed as being utility motivated in the sense that the GP can improve his or her utility (sense of well being) by delivering an improved quality of service and greater patient satisfaction. Certainly, as indicated above there is anecdotal evidence of innovative behaviour in relation to service delivery which would be consistent with aspects of the Schumpeterian view of the entrepreneur. Equally, if GPs are behaving in a manner which is consistent with the expectations of the reformers then we might expect to see efficiency gains and resource savings consistent with Leibenstein's view of the entrepreneur. Finally, given the ability of GPs to choose providers we might anticipate that behaviour consistent with the Austrian view would be observed as GPs seek to exploit price differentials between providers. However, it would not be unreasonable to expect that GPs could display a variety of motivations for the work they do generally and for their decisions with respect to fundholding. This suggests that as well as observing different types of entrepreneurial behaviour, there may also be the potential to observe different types of entrepreneur; the extent to which any such public sector typology is consistent with a observed private sector typologies is open to debate and for the present will be viewed as essentially an empirical question.

4. Research Design

The relative novelty of the concept of the public sector entrepreneur and the uncertainty surrounding the concept suggests that any attempt to research this area must initially be exploratory in nature. Past research examining the nature and characteristics of entrepreneurship has focused on a range of issues including motivation (Lafuente and Salas, 1989), goals (Dunkleberg and Cooper, 1982) and social orientation, managerial style and competitive environments (Davidsson, 1988). These characteristics have then been employed to develop typologies of entrepreneurs in order to improve understanding of the complex concept of entrepreneurship. The problems associated with this type of approach have been well documented (Woo, Cooper and Dunkleberg, 1991, Chell, Haworth and Brearley, 1991). If there are problems in establishing typologies of entrepreneurs in relation to private sector activities, those problems are likely to be even more acute in relation to the public sector.

Consequently, the purpose of the research was to examine the nature and characteristics of entrepreneurship through exploratory qualitative and quantitative research. The data for this study were collected from a series of face to face interviews with fundholding and non-fundholding GPs. The interviews varied in length with most lasting betweem 45mins and one and a half hours. A semi structured interview schedule was used with questions concerning motivations for the move to fundholding status, the nature of changes that have occurred, developments in contracting procedures and management activities with the practice. Interviews were conducted with 21 Warwickshire fundholders, 21 Leicestershire fundholders, 18 Notts/Derby fundholders and 9 Notts/Derby non- fundholders. The 27 individuals interviewed in Notts/Derby were also asked to complete a short questionnaire to measure attitudes to their environment and the changing nature of general practices. This questionnaire was developed from the model proposed by Bull and Willard and sought to measure the degree of task related motivation, expertise, expectation of gain and the nature of the environment. Interview transcripts were analysed by at least two of the three researchers and preliminary analysis of the questionnaire responses was undertaken using SPSSx.

5 Qualitative Analysis

The analysis of the interviews with fundholders concentrated on understanding the motives and behaviour and the extent to which these motives and behaviour might be consistent with theoretically defined concepts of entrepreneurship. Although the focus of this analysis was fundholders, this does not mean that non-fundholders were assumed to be non entrepreneurial but rather that a priori, it was thought that the most obvious manifestations of entrepreneurship would occur within that group of fundholders. It is clear from the interviews that there is considerable variation in the motivation for adopting fundholding, subsequent behaviour and the extent to which the GP and the practice have been able to exploit the opportunities created by fundholding for the benefit of their patients. From discussions with interviewees, the motives for adopting fundholding appear to fall into two broad (and occasionally overlapping) categories; the positive motives which emphasised the opportunities offered by fundholding and the negative motives which are typical of the reluctant participant. Positive motives included factors such as the desire to improve patient care, reduce the length of waiting lists, innovate and enhance patient choice. Negative motives included factors such as FHSA pressure, concern about a deterioration in the quality of care received, pressure from neighbouring practices and a general feeling that there was little long term alternative to fundholding.

At a simple level, there are some similarities in motivation between the craftsmen (more concerned with getting on with their job; satisfied with things as they are, not actively seeking or promoting change) and the more resigned fundholders and the opportunists (proactive, looking for success and being willing to promote change) and the more positive fundholders. Certainly interviewees could be divided into two groups along these lines, with the more active or true entrepreneurs displaying the more positive motivations and also being more active in terms of the types of entrepreneurial behaviour outlined above. By contrast, the craftsmen or reluctant entrepreneurs are characterised by the prevalence of more negative motivations, are much less likely to switch providers or to shop around for the best deal with respect to price and quality. Typically, this group attach considerable importance to keeping their local provider in business.

In addition to examining variations in motivation at a general level to identify different types of entrepreneurs, it is also appropriate to examine forms of entrepreneurial behaviour. Attention is focused on three broad areas - the reduction of x-inefficiency, price-quality arbitrage and innovation.

X-Inefficiency
The process whereby fundholders contract with providers for secondary care provides a mechanism which can be used for reducing organisational slack (for example by specifying when patients are seen, by whom and how frequently). However, the extent to which fundholders are actually able to reduce x-inefficiencies depends on how contract provisions translate into actual behaviour. Some practice have specified in contracts the number of outpatient attendances and who should see the patient. When the specifications have not been met practice managers have contacted the providers concerned to complain. While this does place increased pressure on providers to deliver what they are supposed to deliver in an efficient way, the absence of formal mechanisms for enforcing the provision of the contracts raise questions about the extent to which organisational slack is reduced. Indeed, a closer examination of invoicing and payment arrangements highlights considerable inefficiencies and delays which according to the contracts should not occur.

In practice, many GPs indicated that they were reluctant to ignore invoices however late they may be. Some GPs had taken a slightly stronger line. For example, a consortium of Fundholders were charging their main Provider a 5% invoice fee because of all the administrative work involved in correcting errors and additionally sending clerical support into the Provider unit to expedite queries. Another Fundholder used the withholding of payment as a lever to sort out other administrative problems. However, the majority of GPs were tolerant of very inefficient practices. One First wave Fundholder stated:

"We do not have one invoice coming from the ABC hospital that is not incorrect".

Similarly, one practice received and paid and invoice in February 1994 for œ16,000 which dated from April 1991.

Price-Quality Arbitrage
The Austrian view of the entrepreneur as typified by Kirzner (1973) concentrates on the entrepreneur as an equilibrating force. This push towards equilibrium is created by the entrepreneur's role as arbitrageur, exploiting gaps that exist between and within markets. In principle, GP fundholders have the potential to perform such roles in that the placing of contracts and the purchase of secondary care gives them the opportunity to select the best price-quality configuration from a range of providers, although in practice the scope for arbitrage may be restricted by geographic considerations.

Insofar as approach to purchasing was concerned, there was considerable resistance to the idea of price as a bargaining tool;

"We were appalled to hear colleagues bragging about screwing down on price".

and few Fundholders mentioned price as being of major importance;

"Finance first of all and then whether you are going to get them to develop the type of service you want."

The more common approach was to emphasise quality and accessibility, although in many instances there was an implicit or explicit use of a 'value for money concept';

"You send the patient where you best think that they are treated for that specialty not because it is ten pounds cheaper down the road,"

Typically, the more entrepreneurial practices negotiated on the basis of explicit quality factors, with waiting times cited most frequently. By contrast the less entrepreneurial practices tended to focus much more on the objective of keeping a main provider in business.

The interviews revealed that in practice, most Fundholders have purchased services similar to their referral pattern prior to fundholding. Five out of the 21 Warwickshire fundholders, 3 out of 21 Leicestershire fundholders and 5 out of 18 Notts/Derby fundholders claimed that they had not changed Providers at all during the period they had been fundholders. The majority of fundholders had made some changes to their referral patterns. In many instances these changes were small or incremental and many GPs indicated that they would not make substantial changes of provider as one of their prime concerns was to keep a particular provider in business because it was geographically convenient. Thus for example, one interviewee commented;

"The Partners instruction to me was that I should not go all out to further de-stabilise it (ie the provider unit ).... it is a primary consideration with the Partners but it is not one that I will ever admit to over negotiation".

Among those fundholders who were willing to make significant changes in their purchasing pattern, some made long term shifts in response to an improved price-quality configuration, others used the ability to switch provider as a mechanism to force a preferred supplier to provide the desired service. For example one fundholder found that XYZ Hospital would not provide Direct Access X ray facilities but a competitor would. The contract was duly switched to the competitor. In order to regain business, XYZ offered to match the competitor and the Fundholder promptly switched his business back to the XYZ. Longer term changes in contracting include two practices which have moved Pathology services away from their main Provider on a cost and quality of service issue and a General Surgery clinic which was taken from one provider because of the quality of service (for every referral there would be six outpatient attendances often seen by a junior doctor). An intermediate case is the fundholder who had split a physiotherapy contract between two providers partly as an insurance policy because they had been let down by their main provider and partly as a reward to the rival Provider who had helped them out when they were let down by the original Provider.

Innovation
The strong association between entrepreneurship and innovation suggests that it is appropriate to examine the extent and nature of innovation by GP fundholders. By far the most significant form of innovation has related to service delivery. Almost all of the fundholders interviewed had established 'satellite' clinics at their own surgeries. Such clinics have two particular advantages; they bring the consultant to the patient rather than sending the patient to the consultant and they reduce waiting times (as well as costs in some instances). The staffing of these clinics varies. In some instances, the provider sends its own staff as part of its service to the fundholder; in instances in which the provider is unwilling to offer such a service, the clinic will be staffed by consultants working on a private basis. In many fundholding practices these clinics have been used so heavily that lack of physical space restricts further expansion along these lines. Nevertheless, one practice which has some spare capacity in such 'satellite' clinics will 'sell' that spare capacity to another practice.

One of the major problems with respect to service delivery has been waiting times. Problems with long waiting lists have been tackled by one-off contracts with other Providers (if necessary, at a higher price). In instances where GPs have an ideological objection to going private, these contracts have been with other NHS providers - sometimes at a moderate distance from the patients home. In other instances, there are GPs with no ideological objections to using the private sector; as one interviewee commented:

"We have an agreement with the surgeon that he rings me and says 'I can do this procedure more cheaply at the private hospital than I can under the NHS' and then we go ahead with the private hospital. You are sometimes two or three hundred pounds cheaper per procedure at a private hospital."

In one instance, a GP arranged for his patients to be seen for minor surgery on a one-off basis at a hospital in Calais, with organised transport to collect and return patients. A similarly innovative approach to address the problems associated with waiting times occurred in the case of one practice which attempted to purchase theatre time outside of normal working hours and employ a surgeon to undertake a series of outstanding operations.

In considering the concept of innovation and innovative activity it is necessary to consider the behaviour of a practice relative to its environment. For example, it becomes increasingly difficult to calibrate the practices as innovative or non-innovative because their behaviour often is conditioned by their environment. A Fundholding practice which was in favour of peripheral clinics was situated within a few hundred yards of their main Provider and although inherently desirable, could not justify for example a satellite service because of the close proximity of their main provider.

The changes above represent a comprehensive list of all the changes that were mentioned in the interviews. The changes were by no means common to all practices for a variety of different reasons: some of the services above were already supplied to some practice pre-fundholding. Some practices have no need of all the services because of the make-up of their particular patients, their proximity to providers, space availability in the surgery and the fact that a small number of the practices did not want actively pursue an agenda for change. Nevertheless, in most instances, behaviour of this sort may be regarded as innovative in that it breaks with a long standing tradition within the NHS and in many cases also displays an element of traditional austrian style arbitrage.

6 Quantitative Analysis

The qualitative analysis has highlighted different forms of entrepreneurial behaviour and different patterns of motivation and has provided some initial indication that there might be different types of GP entrepreneur. To explore this issue further, specific attitudinal data was collected for the 27 Notts/Derby GPs, both fundholders and non-fundholders. A brief questionnaire was designed to collect information on the push and pull antecedents to entrepreneurship identified by Bull and Willard (1993). Responses were collected across a total of 26 attitudinal statements. Although the sample size is small, the data were subject to an exploratory factor analysis to identify any underlying dimensions in respondents attitudes. Eliminating items with high cross loadings or small communalities produced the solution shown in Table 1.


  Table 1: Factor Analysis

                                 Factor    Factor    Factor    Factor
				   1         2         3         4
                                  Task      Work     Social   Expertise
                               Motivation   Role      Role
I welcome the challenges of
the reformed NHS:                   .98455
The NHS reforms provide a real
opportunity to improve the quality
of service to patients:             .84218
NHS reforms have enabled me to
enhance the well-being of
the community:                      .81718
The role that I now have to adopt is
not the role I was trained for:             .93371
The NHS reforms have made me                
more business-like:                         .81112                  
The GP has to weigh the cost implications
of the treatment they prescribe against
the health needs of the patient:                    .86683
The GP commands respect in the
community:                                          .85259
I enjoy playing my part in managing
the activities of the practice:                             .90043
The challenges of the reformed NHS
make be anxious (reverse coding):                           .52464

Cumulative % of varaince explained:  33.2    52.1    63.7    78.8

Four factors were extracted accounting for 79% of the variance in the original data set. Two factors correspond well with the constructs of task related motivation and expertise. The remaining two factors are less clear; factor 2 seems to reflect perceptions of a change in work role and a move towards a more business like means of working. Factor 3 is the most difficult to interpret but was though to relate to aspects of the way in which society perceives GPs. Factor means for the four dimensions were used as an input to an iterative partitioning cluster analysis in order to establish whether there existed subgroups of GPs who differed systematically in their attitudes. The results of the cluster analysis are shown in Table 2. Given the scoring system used, a lower score indicates a greater degree of agreement with the relevant scale items.


 Table 2:  Cluster Means 

Cluster     Task       Work       Social      Expertise      Cluster
         Motivation    Role       Role                       Size

1            2.11       2.11      3.50        1.72          9
2            3.00       2.31      2.19        2.56          8
3            3.70       2.55      3.35        3.10         10         

ANOVA
(sig of f):  0.00       0.52      0.00        0.00

The first cluster comprises GPs with a high degree of task related motivation (in the context of the NHS reforms) and a high perceived level of expertise; these GPs do not appear to be unduly concerned with their social role. By contrast, GPs in cluster 3 perceived themselves as weak in relation to expertise and have a relatively low degree of task related motivation. Cluster 2 GPs are somewhere in between these two extremes and seem to be the ones most concerned or aware of their social role.

Table 3 presents more specific details on the characteristics of GPs in each of the three clusters. From the description above, cluster 1 GPs might be expected to be the most entrepreneurially active and cluster 3 GPs to be the least active. All GPs in cluster 1 were fundholders and a large proportion of these were first/second wave entrants. These were typically the larger practices, although this would be expected given the initial qualifying requirements for fundholding.


  Table 3: Cluster Characteristics
           
                                             Cluster
                                    1           2         3

%Fundholders:                       100          37.5      60
%First/second wave:                  55.6        33.3      16.7 
%Altering referral patterns:         88.9        37.5      11.1 
Average list size:                 8550        5481      6792
Average number of partners:           4.2         2.3       3.6
Age of lead partner:                 50          45        43
New services introduced:             10.11       10.87      8.0
New services introduced (adj.):       2.8         5.7       3.4

Cluster 2 contains primarily non-fundholding GPs and tends to be characterised by relatively small practices. Those fundholders in cluster 2 had all altered their referral patterns and interestingly, it is this group of GPs which displayed the highest number of new services and highest number of new services per partner of the three clusters. Cluster 3 is almost equally split between fundholders and non-fundholders and only a relatively low proportion of this group had altered their referral patterns. These practices are medium sized with a moderate rate of new service introduction.

From this preliminary evaluation of the clusters, there is some evidence to suggest that cluster 1 comprises the more active entrepreneurs (early fundholding, changing referral patterns) and cluster 3 comprises the less entrepreneurially active GPs. However, there are some inconsistencies in the evidence, particularly with respect to the adjusted (per partner) rate of new service introduction.

7 Conclusions

The concept of entrepreneurship in the public sector and the ways in which entrepreneurial activity are manifested is still poorly understood. The concept of the entrepreneur as a resource allocator and a co-ordinator appears relevant in the public sector on the basis of this analysis of primary care. However, the results suggest that not all GPs would wish to or are able to adopt an entrepreneurial role. Simply creating the opportunity for entrepreneurship and innovation to occur does not ensure that it will. Indeed this point is arguably of particular relevance in the public sector where there is the potential for considerable ideological resistance to the principle of entrepreneurship. Evidence of such resistance was provided explicitly in the form of responses to questions but also, and perhaps more importantly implicity in the form of a general unwillingness to penalise providers for delays and mistakes in invoicing. Creating a quasi market in the public sector may create an environment in which individuals can behave entrepreneurially but it does not necessarily guarantee that they will.

While qualitative data provides evidence for the existence of differing degrees of entrepreneurial activity among fundholders, the search for a typology of GP entrepreneurs using quantitative data produces rather more ambiguous results. The qualitative analysis suggested that some GPs were active and positive in their approach to fundholding and others were rather more reluctant and negative. The quantitative data suggested that, based on fundholders and non-fundholders, it might be possible to identify three distinct groupings - active entrepreneurs, moderate entrepreneurs and inactive entrepreneurs, and while there is evidence for differences between these groups, not all of the differences are consistent. However, at this stage in the research such an outcome is not unexpected. In particular, the sample size is still small and there is a need to integrate the qualitative and quantitative information to explore in greater depth the characteristics of the individuals within each cluster.

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