Horizontal and vertical integration in hospital laboratories and the laboratory information system.

An understanding of horizontal and vertical integration and their quasi-integration variants is important for pathologists to formulate a competitive strategy for hospital clinical laboratories. These basic organizational concepts, in turn, are based on the need to establish control over critical laboratory inputs and outputs. The pathologist seeks greater control of mission-critical system inputs and outputs to increase the quality and efficiency of the laboratory operations. The LIS produces horizontal integration of the various hospital laboratories by integrating them vertically. Forward vertical quasi-integration of the laboratories is mediated primarily by the LIS through front-end valued-added features such as reporting of results and creating a long-term on-line test result archive. These features increase the value of the information product of pathology for clinicians and increase the cost of switching to another system. The LIS can also serve as a means for customizing the information product of the laboratories to appeal to new market segments such as hospital administrators.