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AbstractPurpose -The purpose of this paper is to address a gap in operations management empirical research through the use of diffusion of innovation (DOI) theory to develop further insight into patient flow and bed management, a problem that has been taxing healthcare organizations across the world. Design/methodology/approach -The study used an action research (AR) approach and was conducted over an 18-month period within an acute hospital in the north east of England. Data were generated through enacting AR cycles, interviews, participant observation, document analysis, diaries, meetings, questionnaires and statistical analysis. Findings -The research conducted within this study has not only led to practical outcomes for the hospital in terms of the successful adoption of a new patient flow system but has also led to new knowledge about the determinants of diffusion for technological and process innovations in healthcare organizations which are complex and highly political. Research limitations/implications -AR is not suited to all organizations and is most appropriate within those that are culturally attuned to participative and democratic ways of working. The results from this study are not generalizable but some similar organizations may see merits in this approach. Social implications -The AR approach has supported the hospital in adopting the new system, PFMS. This system is helping to improve the quality of patient care, providing facilities to support the work of clinicians, aiding timely discharge of well patients back into the community and saving the hospital money in terms of not needing to open emergency "winter" wards. Originality/value -From an operations management perspective this work has demonstrated the potential to bring theory, in this case DOI theory, and practice closer together as well as show how academic research can impact organizations. Local-H intends to continue developing its AR approach and take it into other systems projects.