The healthcare management system is a complicated one but vital due to the demand and social significance of the sphere. In the US, where the sector is mostly private and, therefore, highly competitive, proper management is a necessity. Since even non-profit organizations compete with others for customers, they should apply methods of management that corporate companies use. As such, strategic planning is the most important part of providing management for the successful and efficient functioning of an organization. To make an enterprise produce a desirable result, healthcare management must plan, budget, implement, monitor, and evaluate its strategy (Walston, 2018). In the current essay, strategic options of Wishard and St John healthcare net hospitals are discussed.
The first clinic net in which strategic resources and plans are to be discussed is Wishard. As described in the case study, Wishard’s competitive situation is rather complex and ambiguous. From one side, the hospital has one of the largest markets in its area that might show that it has a competitive advantage. Namely, the clinic has public-owned facilities that gain funds from Indianapolis, Indiana, and charities. Due to this factor, the net is organized to help disadvantaged individuals who cannot afford care in other clinics. Fortunately, Wishard Health Services already has the modern equipment for providing professional care (Walston, 2018). As a result, its facilities are demanded by the biggest amount of people in Indianapolis, Indiana.
On the other side, there are various deficiencies in the strategical position of Wishard in the local healthcare market. Despite the large customer inflow, the clinic’s net is not of the most considerable size in the area. Then, some of its resources are insufficient for providing care independent from other clinics; the most obvious problem is a financial one. The product range and quality of Wishard are not of particular excellence in comparison with other hospital nets.
The customers are attracted to it due to the policy of accepting uninsured people rather than special services. However, this policy might change soon since it costs an excessive amount of money to the hospital and leads it to bankruptcy. The hospital cannot compete with other industry players in interior design and consumer-oriented strategy because of financial shortage as well (Walston, 2018). Thus, Wishard is in an unfavorable competitive situation due to the bargaining power of its customers.
Although it might seem that Wishard has its unique market consisting of poor people, it surely has direct competitors. Primarily, these are other hospital networks in Indianapolis, Indiana. Healthcare providers such as Clarian Health Partners, Community Health Network, St. Francis Hospital & Health Centers, and St. Vincent Indianapolis Hospital all deliver the same services to their patients. The differences between the hospitals are only in the additional benefits, which vary from clinic to clinic.
They include financial economy options in the case of Wishard and the in-house luxury of other clinics. Additionally, these hospitals are situated in different counties: some of them are in suburban areas (Walston, 2018). Yet, all the mentioned enterprises are professional clinics that help patients in a wide variety of conditions. This, it could be clearly stated that these networks compete for the same state customers since they provide the same broad range of services.
Despite the fact that Wishard has financial issues, it still obtains some leverages that could help it turn its current strategic position into an advantageous one. First of all, Clarian Health Partners expressed interest in merging with Wishard so that the former could expand its network and cut the expenses for management and operating systems (Walston, 2018). For Wishard, it is a possibility to gain some additional financial aid apart from its funds that are obviously insufficient for its sustaining. Moreover, reducing costs would also benefit the clinic since the payments to professional physicians are significantly high.
The merge would not necessarily mean the rejection of the mission that is important to Wishard: namely, the network can continue to help the poor. Thus, one option that Wishard has to leverage its position is to merge with Clarian Health Partners.
Next, Wishard considers the start of the copayments policy in its facilities. This alternative is beneficial for the enterprise due to the fact that it might significantly raise its revenues. Moreover, it would probably not influence these customers who need the care urgently but cannot afford it. In this way, Wishard can continue delivering its services according to its mission and yet be able to get some profit. Furthermore, the clinic can invest these financial resources in enhancing its strategic position.
Unfortunately, from a societal perspective, several problems occur with a stand-alone public hospital with a primary mission of serving the indigent population. Primarily, this problem is caused by the nature of the mission itself. Since the population served is poor and unable to pay for the care, it would never be profitable for its workers and owners. Then, since the company is not profitable and surely would end up in bankruptcy, the quality of the service will decline when the hospital’s financial state worsens. As a result, people who, in most cases, need medical help the most, such as retired people, cannot have it.
Additionally, the competitiveness and commercial nature of the industry restraints the possibilities of support for public hospitals. Since no wealth enlargement process is expected from these facilities, shareholders prefer to fund for-profit organizations more often than the public. Therefore, the hospitals always await delinquency in social support that is essential for their functioning.
Although Wishard might seem like a failed public health care system that cannot withstand the external influences of the industry, several strategic steps can be proposed. First of all, it would be correct to use the policy of copayments by the patients who can afford it. To implement this practice, there should be developed a solid system that would state all the possible causes of copayments.
Some clients must be informed about the consequences of their aversion to using the hospital’s services before emergencies. Moreover, the hospital might train its workers so that the system works properly. Secondly, an important strategical step would be gaining support from the government and local officials, which is useful for getting financial aid. The methods that can guarantee such help are marketing campaigns, such as branding (Leijerholt et al., 2018). If the hospital can attract the attention of people who care for public health and wellness and have resources for that, it would gain the monetary support that it needs to a larger extent.
The other advantage of Wishard was its component administration; the contrasting situation can be seen in the case of St John’s hospital. This institution also experienced great losses; as a result, a new strategy was proposed by one of its employees. After a series of subsequent strategic steps, the financial situation of St John hospital even worsened along with customers satisfaction. The cause for the failure of the strategy was that incompetent people made decisions while accepting no criticism. Namely, one ambitious person of the organization took the responsibility of reorganization of the company.
This person was Alexander, who recently had been interested in restructuring courses and visited these closes. Alexander alone was the head of the changes while having no formal education in the subject. As known, excessive centralization may course serious problems to any social structure, including the hospital.
The other reason why the mission of restructuring failed is that the consultations with management representatives were minimum. It is suggested that management professionals have more knowledge and experience in design-making (Sousa et al., 2019). This led to physicians planning the strategy instead of managers; these decisions lacked foresight and resulted in catastrophe. At all levels, managers were marginalized among other workers and remained restrained from the implementation process. Then, the ill-management done by non-professionals was the true reason why the situation in St John hospital worsened.
To conclude, the essay overviewed and evaluated two different case studies. The first one was about the declining revenues of the Wishard public hospitals network. The failure of the enterprise was caused by the internal structure of the industry, where helping the poor is a disadvantaged strategy. Yet, the administration of the network proposed some solid solutions. In contrast, St John’s hospital failed to recognize its genuine problems and provided mismanagement decisions.
References
Leijerholt, U., Biedenbach, G., & Hultén, P. (2018). Branding in the public sector: A systematic literature review and directions for future research. Journal of Brand Management, 26(2), 126–140. Web.
Sousa, M. J., Pesqueira, A. M., Lemos, C., Sousa, M., & Rocha, L. (2019). Decision-Making based on big data analytics for people management in healthcare organizations. Journal of Medical Systems, 43(9). Web.
Walston, S. (2018). Strategic healthcare management: Planning and execution (2nd ed.). Health Administration Press.