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The rapid changes in the environment have exerted significant pressures on healthcare providers to reassess their strategies. Furthermore, it is a paradox that the best clinicians are, themselves, not the best managers in running the healthcare services. Hence, a management model is set up using quality function deployment (QFD) where strategies are developed through a partnership between managers and clinicians for the provision of total quality healthcare in the light of dramatic changes in the health‐care environment. The QFD‐led model consists of seven parts, which includes service planning, operational planning and new concepts deployment. The power of the QFD‐led model comes from the detailed discussions with customers about their expectations, comparisons with competitors and considerations of how the healthcare provider can meet the customers’ expectations most effectively. The application of QFD in a restructured regional acute‐care hospital is discussed.

Today, hospitals not only have to contend with the dynamics of regulation and market forces but most importantly “service quality”. Service quality is a measure of how well the total service package meets customers’ expectations. The abilities to identify and prioritize customers’ expectations and to perform existing process assessment are important elements of a successful quality improvement strategy. The inherent characteristics of services complicate the efforts for quality improvement. Quality function deployment (QFD) is a systematic technique for designing services or products that are based on customers’ expectations. Given the proven success of QFD in manufacturing, this paper explores the applicability of QFD in health care. It describes the QFD technique and how it leads to a better understanding of customers’ expectations. It presents recommendations and a generic framework that is supported by empirical findings as a reference model for hospitals.

In today’s highly competitive healthcare environment, hospitals increasingly realise the need to focus on service quality as a means to improve their competitive position. Customer‐based determinants and perceptions of service quality therefore play an important role when choosing a hospital. This paper attempts to determine the expectations and perceptions of patients through the use of a generic, internationally used market research technique called SERVQUAL. An analysis covering 252 patients revealed that there was an overall service quality gap between patients’ expectations and perceptions. Thus, improvements are required across all the six dimensions, namely, tangibility, reliability, responsiveness, assurance, empathy and accessibility and affordability.