DigiHealth aims to address the gap between the cost of healthcare in the United States and the need to improve the well-being of community members by teaching them self-care and appropriate healthcare practices. For this purpose, this business will introduce an application where an individual can input their data and choose an activity that helps them develop healthy habits. According to the Centers for Disease Control and Prevention (CDC, 2022), six in 10 citizens have at least one chronic condition. For example, with the rising number of people diagnosed with type II diabetes in the United States, there is a clear need to help people manage their diet and physical activity to avoid them having to visit their healthcare provider often and improve the quality of their lives (CDC, 2022). The application will provide information on the best eating choices for individuals with this diagnosis, offer them support and communication with healthcare professionals, and help them track their progress in reaching their health goals.
The fact that Americans spend a significant amount of money, more specifically, $4.1 trillion per year, on healthcare each year is not surprising since costs for health and wellness in the nation include expensive insurance premiums, high deductibles, co-pays, and other out-of-pocket expenses, apart from other expenses (CMS, 2022). Therefore, having a business strategy that focuses on improving the health of the population can be beneficial for addressing these concerns. Moreover, this business model contributes to the community’s health because it can provide free-of-charge subscription plans for underserved populations alongside regular for-profit services.
Government policy is one factor contributing to increased healthcare expenses. Providers could raise costs ever since Medicare and Medicaid—programs that aid those without health insurance—were established. However, the government’s programs to this day have had little effect on helping communities increase their well-being and health. There is still a significant number of people who are still uninsured, which is approximately 22 million (CDC, 2022a). The number of chronic diseases in the United States is continuously increasing (CDC, 2022a). An application that targets health is the right solution for the healthcare crisis in the United States because chronic diseases, in most cases, cannot be cured. Instead, patients have to learn to self-manage to avoid further harm being done to their well-being and ensure that they do not develop comorbidities.
Role of Strategy
The value of a business strategy cannot be overlooked once operations have begun, especially for a startup business such as DigiHealth. Any leader who is not aware of its significance cannot guarantee the organization’s long-term viability. The significance of company strategy is of utmost importance, given how competitive the corporate world is today, especially for a business operating in such a competitive and high-cost environment as healthcare. Therefore, forming a strategy for DigiHealth smartphone application business is essential; moreover, this strategy should reflect the mission and values of this business.
Planning is essential during the early stages of developing a business. While a plan makes the objectives clear, the strategy aids in carrying out and achieving the vision. The plan for this business is to develop a mobile phone application available for iPhone and Android phones. The value of a business strategy cannot be understated once operations have begun. Any leader who is not aware of its significance cannot guarantee the organization’s long-term viability. The strategy for this business is to create value for consumers by lowering their healthcare expenditures and improving their quality of life.
Businesses utilize positioning to shape a target customer’s perception of a brand’s good or service. Positioning explains what makes a brand’s offering special and how it gives customers a clear advantage. Businesses use marketing to explain their position in the market to consumers and shape how they view the goods and services offered by the brand. The brand identity is established through marketing, which also affects how customers perceive the brand’s position in relation to competing products. Therefore, the positioning strategy of this application will be communicated to consumers through marketing activities.
The positioning of this new business adds value through the goals that are directly linked to the needs of the population. Since the CDC (2022b) and CMS (2022) data show that healthcare costs are increasing and the number of people with chronic conditions continues to rise, the burden of caring for one’s health becomes more troublesome for citizens. This business adds value by helping people care for their health and, in return, can help lower their expenses linked to healthcare. Therefore, the positioning of this business is the improvement of both people’s health and their financial well-being.
Another important element of positioning is choosing the target population that the business will focus on in its efforts to obtain a market share. A company should choose the market segment they intend to target before establishing its position in the market. Either there are a lot of customers in this market area, or it is a niche market that offers an opportunity because there is less competition, and positioning is important in this situation. A company must determine how to position its brand to appeal to this particular customer segment. This target market is characterized by factors based on customer behavior as well as demographics like gender, location, and age. For this company, the target market will be individuals over the age of 18, although the primary focus will be on 30 to 60 years old individuals who are more likely to have a chronic condition residing in the United States.
Industry Analysis
The healthcare industry in the United States is rapidly developing, with more providers investing in the quality of healthcare services and the government continuing to support better access to healthcare. Programs such as Medicare and Medicaid, which were designed to help underprivileged citizens get healthcare services are important for the improvement of the healthcare system in the United States. Still, according to CMS (2022) data, in 2020, healthcare expenditures increased by 9.7%. Considering the aging of the population in the country, the issue of chronic conditions care will become more urgent in the future.
The emergence of the COVID-19 pandemic has drawn further attention to the complex concerns facing the healthcare sector, including a lack of qualified workers, vaccine fairness, public spending, and digital health. Despite having a tiny market, the healthcare sector is one of the most lucrative globally (Economist Intelligence, n.d.). Higher quality general healthcare, greater life expectancy, and increased interest in the industry since the pandemic’s start are projected to improve spending and industry growth in the years to come. Therefore, this business has the potential to address the concerns of quality and cost in the healthcare industry while entering a lucrative field.
The global healthcare sector is at serious risk from supply-chain interruptions and medicine shortages that are to blame for vaccine timetable delays. Across all healthcare industry sectors, relying on a small number of players to produce medications at scale is a persistent concern (Economist Intelligence, n.d). Promising trends include “the expansion of point-of-care testing in Asia-Pacific (APAC), regional IVD market booms in both APAC and LATAM, and advancements in tissue diagnostics” (Economist Intelligence, n.d). Ultimately, a streamlined regulatory framework is essential to progress and the development of a genuinely global sector. Figure 1 shows the SWOT analysis for this new healthcare app.
 | |
Strengths
| Weaknesses
|
Opportunities
| Threats
|
Strategic Planning Process
The organization’s mission and goals will be determined considering the value that DigiHealth brings to the consumer, which is the ability to take better care of one’s health. The mission and goals can be justified through the value that this company brings to the consumer, which is improved quality of life and the ability to save money. The strengths of this business are its low cost as opposed to traditional healthcare services and its ability to access advice from qualified professionals. The main weakness is that older consumers may find it difficult to use a smartphone application. The strategy of this business is cost leadership since the services will be cheaper than those of the competitors. On a tactical level, the strategy will be implemented by creating monthly goals. Operationally, the leadership will focus on developing and improving the application to bring the best results to the consumers. The contingency strategy will focus on a potential disruption in the healthcare business, similar to COVID-19, which will allow adapting this application to needs other than chronic conditions care. In terms of crisis planning, the business will try to obtain funding from investors to support the operations.
Financial Considerations
The most important element of strategic planning for a new business is financial planning. Since this is a technological business in the field of healthcare, the company will need to invest in the development of the application by qualified engineers and the promotion of it by a marketing team. The financial return will be generated through the subscription model, where the customers will choose from an opportunity to subscribe for a month, six months, or a year. The ramifications for the financial requirements for this business are linked to its technological and startup nature. Therefore, the leadership of this company must follow the transformational tradition to be able to address the challenges of a technology startup company.
Organizational Structure
Organizational structures can reposition to promote innovation and creativity. One way to achieve this is by fostering an environment that encourages employees to take the initiative and propose new ideas. Therefore, the management should guide the employees as opposed to monitoring everything they do within this organization. Regular meetings and sharing ideas will be the key to ensuring that this new company is innovative.
Conclusion
The new company wants to close the gap between the high expense of healthcare in the United States and the requirement to enhance community members’ well-being. This company will launch an application where users may enter their information and select a habit-forming activity for this reason. Given how cutthroat the business world is today, the value of company strategy cannot be emphasized, particularly for a company working in the highly competitive and expensive healthcare industry.
References
Centers for Disease Control and Prevention. (2022a). Chronic disease.
Centers for Disease Control and Prevention. (2022b).Type II diabetes.
CMS. (2022). Historical.
Economist Intelligence. (n.d.). Healthcare industry trends.