This paper explores the motivation and behaviour of hospitals, using data from UK hospital Trusts. Managers and consultants (hospital specialists) are identified as the main alternative sources of power within Trusts. It is hypothesised that consultants are interested in production or service (volume and quality) while managers are interested primarily in financial break-even, and that in the long run consultants will dominate. A survey of 1500 consultants and managers and a statistical analysis of the behaviour of 100 Trusts over 3 years yielded the empirical results that were largely but not entirely consistent with these hypotheses. Consultants did indeed consider production goals to be more important than financial breakeven, but within those goals, considered quality to be more important than service volume. While the break-even target was found to be the primary goal of managers on average, they proved to be a heterogeneous group with quality ranking as the main priority among those managers who are closest to service delivery. This is at odds with the apparent objective of Trusts, which both groups perceive as being the single-minded pursuit of financial targets, consistent with the formal, government-set requirements. We find that this strong and unequivocal financial driver is not owned or acted upon by either consultants or managers and it is inferred that, in accordance with the dominant motivation of consultants, the Trust's primary objective is to maintain service quality.
