Strategic Health Services Management
Final Case Analysis
Name
Institution
Final Case Analysis
Strategic Health Services Management
A structured strategic management is very necessary as an approach needed in tackling revolutionary changes in the healthcare system. Health care organizations have today universally embraced the strategic management perspectives developed in the business and heath sector. The health care systems have developed strategies and management systems that are unique in their own ways. According to Swayne, Duncan and Ginter, P. (2013), health care leaders have realized that strategic planning, thinking, and managing strategic momentum are important for coping with the dynamic nature of the health care industry. Strategic management has become the single most effective manifestation of effective and reliable leadership in the health care organizations. Strategic management provides a guiding framework for the management of all kinds of contemporary health organizations.
Over the past few decades, strategic management concepts have been widely applied in the healthcare industry. Swayne, Duncan, and Ginter (2013) notes that the concept of strategic management has continuously been embraced or adopted by healthcare organizations as a core part of leadership and as one way of anticipating and coping with different external forces. The key purpose for strategic management in health care system is to ensure that there is a fit between the external and internal environment of an organization. To ensure survival and compatibility, health care organizations should have the ability to comprehend the significant shifts in environmental conditions and be able to equip their organizations to be able to succeed in the new environments. So many health care organizations are set up every passing day and they are formed based on new technologies and new forms of operation that if the old health organizations do not have the strategies to analyze their operations, they can easily be edged out of the market. This calls for constant and persistent reforms in relation to the changing external environment (Swayne, Duncan, and Ginter, 2013).
Strategic Management in health care can be considered in a number of ways in relation to how different factors affect the American citizens. The first strategic management in this aspect is the cost management. The rising costs for the American patients in the healthcare industry has motivated the providers to make efforts in managing such costs, while at the same time offering quality care at affordable prices. According to Swayne, Duncan, and Ginter, (2013), one major step taken by the providers in reducing costs is analyzing and establishing the inefficiencies associated with the operations of heath care organizations. The next point is the aspect of information management, which is a key factor in the management of both the mission and the costs incurred by healthcare providers. An increase in the availability and the quality of information systems, like computer software, hardware, and networks, can boost the knowledge and operations of the providers and at the same time improve the quality of healthcare provided to the patients. The availability of computers will ensure that all the health records of the patients are safely stored for faster accessibility and also used in the future to obtain any important information (Swayne, Duncan, and Ginter, 2013).
The next strategic management is system management, which when properly managed can provide both quality patient care and high technology which may be difficult for single facilities to access single handedly. For example, the health care system of the Indiana University is formulated in such a way that all patients can access whatever resource they need across the state. It has a central system office that is able to coordinate all the services in its member hospitals in various cities across the state. Gathering such resources and information enables small business owners, their employees, and even patients to access a large volume of information within a very short time. The other aspect is the patient care management, which may include diagnosis, laboratory testing, examination, treatments, prescriptions, and surgery. These services can be provided in state-of-the-art mobile care facilities, hospitals, or even in a physician’s office, by the providers. According to Swayne, Duncan, and Ginter, (2013), the major challenge facing the health care industry is the manner of managing the different types of patients. The challenge comes in on how to serve all the customers at low costs and at the same time maintain high quality services.
In any hospital environment, there are strategic changes that often take place and need to be put into consideration. For a health organization to continue performing, there is need to adopt new polices in order to remain relevant in its operations. The organization can for example make use of a research focusing on the future trends to elucidate whether a certain strategy change would help in the achievement of goals and objectives. However, certain strategies may promote the accomplishment of some set of goals but at the same time work against another goal. This implies that one strategy can at times conflict another, thereby calling for the need of health providers to understand strategic co-ordination. According to Swayne, Duncan, and Ginter, (2013), most of the organizational and environmental characteristics are negatively associated with the operational efficiency or market share in the health care environment. Only for-profit status and stringent Medicare payments correlate with proper financial performance. This implies that urban hospitals lose market shares in wealthier, competitive, and highly populated communities. The urban hospitals have on the other hand strived to overcome this challenge by diversing their operations across many regions within the state so as to expand on their volume of clients (Swayne, Duncan, and Ginter, 2013).
SOSI
The SOSI (Statement of Strategic Intent) for C. W. Williams Health Center is to promote a better future, in terms of health for the community; by continuously giving the best, reachable healthcare; with respect, compassion, and pride following the vision of the organization’s founder-Dr. Charles Warren Williams. The strategic statement also indicates that C. W. Williams need to advance into the 21st Century through promoting a brighter and healthier future of the black community. The health center’s Chief Executive Officer, Michelle Marrs, with her 20 years experience in health care management and efficient delivery of services was the major force behind the center’s financial improvement and the efficient provision of health care. Her efforts entailed optimizing and rationalizing operation efficiencies, increasing payment rates to the heath center by initiating insurance systems, starting partnerships with several regional providers of healthcare services aimed at improving the organization’s network, and strengthening the links with private providers of community healthcare services (Swayne, Duncan, and Ginter, 2013).
The chief executive had the objective of providing health care services to individuals who were medically underserved majorly in the rural areas since half of the individuals who were medically underserved lived in the rural areas. The other half that were medically undeserved also lived in economically depressed locations in the inner cities, where they lived in poverty and lacked services such as health insurance. Other individuals also had serious problems of homelessness, substance abuse, and AIDS. In order to serve all the citizens across the state, the chief executive formulated strategies that would ensure that health services is accessible to all individuals both to those who lived in the rural areas and also the other individuals who lived in the poverty stricken slums in the cities. One of the strategies was the initiation of the managed care plans, which enrolled over 2 million beneficiaries of the Medicaid program. According to Swayne, Duncan, and Ginter, (2013), low income Americans and the Medicaid beneficiaries had high rates of disabilities and common illnesses than others. This meant that they accumulated comparatively higher costs of medical cover and medical care. However, they were faced with certain challenges such as the rural nature of the Southern states, which made such states not become attractive to most managed care organizations and the insurers that provided fee-for-service to hospitals and the physicians (Swayne, Duncan, and Ginter, 2013).
The strengthening of connections with Tufts Medical School, in addition to creating plans and programs to develop several community-based health centers helped in bringing healthcare services nearer to patients. Raising finances is the immediate step into realizing a brighter future for C. W. Williams and Tufts Medical School relationship. This is a vital step given that the history of losses in finances is connected to the decline in the existence of the health center. The idea of raising finances was a major step in the operations of C. W. Williams health centre because it offered the opportunity to adequately serve the medically underserved individuals in the rural areas by making all necessary facilities accessible to the citizens (Swayne, Duncan, and Ginter, 2013).
Michelle had served in the health care sector for a very long time but she admitted facing a number of challenges due to the rapidly changing health care environment that required new means of operation every passing day. The managed care changes thus forced the health care centre to align themselves to one of the two hospitals. They were forced to stake such a step despite not willing to take away the patients’ choice due to the managed care changes. However, in order to achieve such a mission, the chief executive noted that she needed more help from internal operations before proceeding to the external interactions. She further created the position for the director of finance and at the same time striving to buy another location in order to serve its patients in a better way. The management however argued that buying another facility would seriously stretch the organization financially but on the other hand argued that finding a new location for the facility was a perfect idea since it would give a variety of patients the opportunity to access all the medical services of their choice (Swayne, Duncan, and Ginter, 2013).
APPENDIX
Stakeholder Analysis
It is vital for the board of C.W. Williams to conduct a proper stakeholder analysis so as to identify the crucial stakeholders who are capable of impacting the organization’s objectives and goals. Stakeholders are charged with the responsibility of developing and implementing different tactics and strategies based on the existing health service environment. The stakeholders should be a team of dedicated individuals who are able to transform their activities and operations according to the standards set by the dynamic global medical environment. Major stakeholders of C. W. Williams are listed below according to their significance.
In order to identify the influence these stakeholders have on the operations of C. W. Williams Health Care centre, it is important to consider each stakeholder category on a matrix based analysis. The following shows how the stakeholders have been classified:
MEETING NEEDS
Keep contented in order to meet their needs MAJOR PLAYERS
Influenced actively and closely engaged.
LEAST IMPORTANT
Monitor using minimum effort SHOW CONSIDERATION
Keep them informed
Power
High
Interest
Low
Low
High
Patients: In every organization, patients posses the highest power, but with lower levels of interest in the management of the organization (this is in reference to C.W. Williams Health Center). With this in mind, the patients’ needs ought to be met by keeping them satisfied. According to Swayne, Duncan, and Ginter, (2013), patients are the main reason for the establishment of any health facility and their interest should be paramount to the operations of any health facility. Health organizations that ignore the needs of their patients are not likely to succeed since the patients would be moving out one after the other and eventually leaving them with no patient to serve. In order to succeed, the organization should further carry out periodic surveys on the patients to sample all their desired interests and then look into the best services to offer. C. W. Williams Health Center should move into the rural areas where several individuals who are medical underserved live in order to offer proper and timely services to them. The organization has strived to acquire new facilities and medications that are able to handle serious diseases like HIV/AIDS, which is a major disease affecting the individuals living in the rural areas and the slums found in urban areas. Swayne, Duncan, and Ginter, (2013) note that the services offered to the patients should be one that is dynamic and universally acceptable.
Physicians: The physicians working at C.W. Williams Health Center are categorized under high power and high interest. Therefore, this group are the major players in the industry, thus should be handled accordingly. These individuals are at the core of operations at every health facility and they greatly influence the success of the health organization. They are at a close interaction with the patients and directly offer treatments to the patients. The organization should therefore ensure that its physicians are a team of experienced and competent individuals who will be able to offer the right kind of treatment for the right disease. Incompetent and inexperienced physicians often lead to patients losing their lives aimlessly because of poor treatments. This would give a bad reputation to the health organization and for that matter not be able to achieve its goals and objectives (Swayne, Duncan, and Ginter, 2013).
Employees/staff: The case of C.W. Williams Health Center’s staff and employees are also categorized under the important players. These two groups should be engaged with keen interest in the management of the organization. They also play a major role in the operations of the organization in the sense that how they treat and handle the patients determines the reputation of the health care center. C. W. Williams Health care center should be able to employ several employees across the state but most notably in the rural areas where the underserved individuals live and where their services are majorly required. The employees and the staff should be a team that is very friendly to the patients, punctual at the work place, and above all dedicated to the achievement of the organization’s goals and objectives. A staff that is unfriendly or rude to the patients would send a very bad image to the public and for that matter may drive away the patients that are in high need of the health services. This would otherwise contradict the organization’s mission and objective of equal service to all. In its quest to adopt new forms of technology in keeping the health records, the organization should be in a position to employ individuals who are able to handle computers to enable them keep all the health records for the patients. According to Swayne, Duncan, and Ginter, (2013), this will not only make the health records accessible for all individuals but will also offer faster delivery of health services.
Board of directors: The board is also a significant player in the stakeholder overview of the company. They have high interest and power in the management of the organization. It is vital for C.W. Williams Health Center to engage the board directly and actively while making decisions on the hospital’s operations. The board of directors should have the interest of the organization at heart by ensuring that all the operations and priorities of the company are rightfully placed. The organization should give the board of directors the power to carry out a periodic strategic audit and analysis of the activities of all employees and other stakeholders to ensure efficiency of the organization. However, the board should be comprised of individuals who have good reputation and integrity to ensure that the organization achieves its goals and objectives (Swayne, Duncan, and Ginter, 2013).
Charlotte Memorial Hospital: Charlotte is categorized under high power in the stakeholder analysis of C.W. Williams Health Center. The hospital was mandated to admit patients who were required to be hospitalized in C.W. Williams. Due to the little space in the health center, more space was needed (and it was available at Charlotte Memorial). There need to be a very close relationship based on mutual trust and respect between C. W. Williams and Charlotte Memorial Hospital so that the patients getting admitted to the hospital get quality treatment based on the mission and vision of C. W. Williams. This commitment was observed in the Chief executive officer when she said that patients are at will to choose the hospital where they receive their treatment.
Federal Government: The federal government possesses high power and low interest in the affairs of C.W. Williams Health Center management and operations. The federal government normally set up rules and regulations that directly or indirectly affect the operations of any health organization. The federal government can also dictate the kind of areas that the health facilities should be built. It can also set up rules that will discourage the citizens from using the facilities of the organization or set up rules that may lead to the collapse of the organization altogether. The federal government also determines whether or not to offer grants for the operations of the hospital. If the federal government decides not to give or reduce the amount of money meant to be a grant for the company, its mission of expanding operations to the rural areas where there are many individuals who are medically underserved would be highly affected. However, it is generally healthy for every organization in any state to observe the existing rules and regulations for purposes of developing a positive public image and also to avoid rubbing shoulders with the federal government. Therefore, the organization need to meet the legal requirement and needs of the government to ensure they are satisfied; failure to which the operations of the organization can be highly compromised (Swayne, Duncan, and Ginter, 2013).
Medicaid consulting groups: The consulting groups possess high power and low interest in terms of stakeholder significance and participation in the operations and management of C.W. Williams Health Center. These are groups that are mandated with the responsibility of offering expertise direction to the organization and devising strategic policies that would ensure that the organization operates smoothly and profitably in the health sector that is challenging and competitive. The Medicaid Consulting group is mandated with the responsibility of carrying out market research and market analysis then coming up with policies that would ensure that the organization achieves its main mission of reaching out to the medically underserved, majorly in the rural areas. The Medicaid Consulting groups should also devise ways and means to ensure that the organization adopts means of operations that are cost effective and at the same time viable in respect to the ever changing medical environment. With the above specs in stakeholder categorization, the health center should ensure that the needs of Medicaid Consulting personnel are sufficiently met (Swayne, Duncan, and Ginter, 2013).
Hospital affiliation: The hospital affiliations of C.W. Williams Health Center are categorized under high power and low interest group. This is because they are concerned with the management, treatment, referrals, and other major activities of the health center. This is a group of people that have the operations of the organization at heart and for that matter highly influence the success of the organization. They can influence the public perception of the organization and how the organization relates with other stakeholders and other agencies that are at a higher position and ability to offer funds to C. W. Health Centre. Because of this, their needs and interests should be handled considering the power they wield in the activities and management of the C.W. Williams.
Non-physician providers: This group is categorized under low power and high interest stakeholders. As much as they may not offer direct treatments to the patients, they have a great impact on the operations and success of the organization in the sense that they form a link between the health center and the external environment. This is very vital given that the Chief executive had stated that her main mission was to set up strategies that would promote the organization’s relationship with the external environment. The organization can not advance its operations externally if there is no channel to link its activities; in this case it would be the role of the non-physician providers to accomplish such a duty. Therefore, C.W. Williams should ensure that they are informed while at the same time showing them greater considerations (Swayne, Duncan, and Ginter, 2013).
Pfizer: Like the Medicaid Consulting group, Pfizer as a major provider of drugs and other important medical aids have high power and low interest in the management and operations of C. W. Williams Health Center. This is another major stakeholder of the C. W. Williams because of their role of distributing drugs to the hospital. Their failure to deliver drugs in time would mean that the patients would not be treated in time, which would mean putting danger on the lives of the patients. The hospital should for that matter ensure that Pfizer becomes a very responsible and reliable team that can be trusted with the delivery of drugs at any time of need. The organization should also ensure that Pfizer produces drugs that are effective in treating the patients and at the same time have long expiry dates so that the drugs can stay long in the hospital shelves without expiring. Since the organization has the potential of benefiting the organization in terms of realizing high profitability; C. W. Williams need to ensure that their needs are catered for (Swayne, Duncan, and Ginter, 2013).
Trend Analysis for C. W. Williams Health Center
There a number of possible events that can emerge with reference to both internal and external situations in C. W. Williams Health Center. Some of these possible events are:
Partnering of Area Hospitals for form HMO Shift from FFS to Managed Care Environment
Increasing the number of community health centers
Increasing need for medical technology
Reduction in government allocation to grant money for C. W. Williams.
The listed trends are categorized and analyzed based on the impact they have on the organization in relation to their profitability on the overall performance of the organizational activities as shown below:
Service Area Competitor Analysis for C.W. Williams Health Center
Service area competitor analysis enables organizations to understand and analyze the significant patterns and factors influencing competition based on the location of the company or the business it is involved. Porter’s 5 forces technique is one of the major strategic tools that can be applied in the assessment and evaluation of service area outlook in relation to the competition faced by the company. Porter’s technique evaluates the industry in which the organization is operating and the competitive rendition using the following main forces:
The suppliers bargaining power
The buyers bargaining power
Threat emerging from substitute services and products
Threats emerging from new entrants into the business
Existing rivalry among or between the established competitors
Using the above forces, C. W. Williams Health Center’ service area competitor analysis can be expressed as follows:
The suppliers bargaining power
The suppliers have a low to moderate bargaining power in the healthcare provision industry targeting the specific community (black). The industry is marked with the presence of well-established suppliers who are capable of providing the same products and services at significantly lower costs. The fact that there exist so many suppliers in the medical industry who are able to offer high quality services and health facilities increases competition among the suppliers. It becomes a situation of many suppliers fighting for a few health providers in the medical industry. The result would be that the suppliers would produce high quality drugs and at the same time supply them at lower prices, which otherwise works to the advantage of C. W. Williams since this gives it the opportunity to serve its patients with high quality drugs. The fact that it is able to purchase the drugs at a lower price will in turn lower its cost of operation and thus give it the opportunity to offer reasonable remuneration to its staff and employees. This will in turn give the employees the motivation to work even harder (Swayne, Duncan, and Ginter, 2013).
The buyers bargaining power
The buyers have a high to moderate chances of bargaining power in the healthcare provision industry. In the locality where C. W. Williams is operating, different institutions and health care centers exist; providing similar services and products to the targeted patients hence the increase in the opportunities of bargaining power to the buyers of the services and products. There are so many hospitals in the region but the chief executive stated that every patient is entitled to choose the hospital to receive medical attention. The loyal customers to W. W. Williams will always stick to their services given the quality services they offer and their desire to serve individuals who are not so privileged in the society. However, when it comes to buying drugs, the buyers will always move to the health providers that offer a variety of drugs at lower prices. This calls for the need of C. W. Williams to co-ordinate with manufactures that produce high quality drugs but at comparatively low costs in order to gain a competitive advantage in its environment of operation (Swayne, Duncan, and Ginter, 2013).
Threat emerging from substitute services and products
Threat emerging from substitute products and services in the healthcare provision to the community is considerably high. The explanation behind this occurrence is managed care provision, which has very high influence on service delivery to marginalized communities and other healthcare institutions. In addition to this, various organizations and community based institutions in the United States of America have developed their own programs assisting the employees. This includes companies that have opened hospitals where its patients can be treated at highly subsided rates and also selling high quality drugs at lower prices. This gives C. W. Williams a competitive disadvantage as the individuals who would have been treated at their health centre get fair treatments elsewhere. The Federal government also has the tendency to open public health centers where most services are free or the drugs are sold at very low costs. Due to the fact that the government operates under economies of scale, it becomes very difficult for the organization to effectively compete in the provision of health services (Swayne, Duncan, and Ginter, 2013). This leaves a negative effect on the institutions charged with the responsibility of giving healthcare to the marginalized communities in any location. The Federal government may also fail on its duty of making the rural areas accessible for the establishment of new health centers. This may also offer a great challenge to C. W. Williams in its objective of reaching out to the marginalized groups.
Threats emerging from new entrants into the business
The threat emerging from new ventures into the industry is low. This follows the fact that the creation and maintenance of a completely new equipment or hospital facility for the provision of specialized healthcare to specific cases. For example, in C. W. Williams’ case, requires heavy investment in terms of effort and capital. Thus, new ventures are left with no option but to consider spending time and resources in their bid to enter and succeed in the industry. It is believed that such efforts are not very attractive to several small businesses (Swayne, Duncan, and Ginter, 2013). C. W. Williams also has the objective of opening up its operations to the interior parts of the village where there are very limited development and accessibility. This makes it very unattractive for other entrants that are only attracted to regions that are already established. Other entrants also begin their operations in such areas but find it quite challenging prompting them to give up and relent on the way. The Federal government also provides grants and benefits to organizations that venture in regions that pose many challenges such as the rural areas that have poor infrastructure, poor technology, and few industries. This gives C. W. Williams a competitive advantage over other entrants while at the same time forming barriers for any new entrant. Therefore, C. W. Williams Health Center is better placed at realizing less competition from new operators in healthcare provision in the area.
Existing rivalry among or between the established competitors
There is a high competition existing among the providers of healthcare services related to C. W. William’s case. Different specialized community healthcare providers exist, thus elevating the competition in the industry. Currently, healthcare institutions including hospitals are undergoing difficulties in the reorganization and restructuring endeavors aimed at ensuring their competitiveness and survival in the industry. As much C. W. Williams has some level of competitive advantage in the rural areas where it established its operations, the competition it faces from large and established health care institutions can never be underestimated. In addition, the rivalry existing between the large and established healthcare institutions also directly affects the operations of the organization since this would mean unhealthy competition within the market, which is not favorable for the operations of C. W. Williams.
Reference
Swayne, L., Duncan, W., and Ginter, P. (2013).Strategic Management of Health Care Organizations, MA: Blackwell Publishing