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Explores the challenges confronting the CEO at the Brigham and Women's Hospital in the wake of radical changes in the health care environment. As pressures have risen for cost containment in health care, the hospital has embarked on a series of reengineering efforts to reduce costs, while maintaining the quality of care. The CEO is now evaluating the results of these efforts and considering alternative strategies for improvement.

Portrays the dilemma faced by Marsh Carter, CEO and chairman of the board of State Street Bank, in May 1995. For the past decade, the bank earned continually expanding earnings through its rapidly growing custody business. Now, as that business matures and custodial fees erode, Carter is seeking to expand the bank's presence in higher value-added financial services. Developing these will require the bank to build new sets of organizational capabilities to leverage and integrate skills located in different divisions of the bank.

Focuses on the decision confronting senior administrators at the Brigham and Women's Hospital: whether to enter into an affiliation with the Massachusetts General Hospital. Requires students to analyze the complex institutional changes in the health environment and to determine how the proposed affiliation might influence the hospital's chances for successfully carrying out its core missions.