4b. Shouldice Hospital case PDF

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SHOULDICE HOSPITAL CASE THE CONCEPT Why is this clinical chosen than the other? Which are its distinctive features? First, there is an aspect of quality: effectiveness of the clinic is ratified by the high level of customer satisfaction, resulting from the guarantee of success of the operation. It is the low percentage of relapses which makes the clinic "quality" than the other: compared to all other, in fact, has a rate of not resolution equal to 1:20; the message that it communicates to the customer is, then, that "here, the problem will be solved ". Besides the success of the operation (so the outcome: the customer has a hernia operation and has solved its suffering in an almost final way), satisfaction is linked, also, the quality of the Experience. To be able to give a value that high (in terms of outcomes and experience), it is critical levers: -

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specialization: the company manages to be effective and of quality because of a focused particular branch of surgery (hernia operation, in fact), always managing to more improve and offer high performance standards Skills: this aspect will be further elaborated later; for now, we will just say that the choice to have capable staff with high skills, and with certain characteristics and prerequisites is important for internal quality and customer commitment.

Secondly, there is the aspect related to the time, which can be analyzed on three dimensions: 1. "how long it takes," or the length of staying in the clinic and the period of recovery. In this case, these schedules represent a compromise between those of traditional hospitals, much longer, and those of emerging clinics that propose interventions even in "day hospital" 2. "variability and predictability" of such timing: just because, the customer is organizing its commitments according to the length of staying envisaged by the clinic, it is important that, unless exceptional events, this expectation is then respected. It emerges as this is one of the strengths of the Shouldice’procedures, capable of ensuring a recovery time absolutely predictable and not very variable, which is approximately of four days 3. "queues": in general, the customer will ever get in front of a rather long queue, because it is a nonemergency surgery. This aspect does not seem to be solved by expanding the productive capacity: whenever they attempted in this way, in fact, initially the queue was absorbed, but then it started to regrow and settle to a certain value. This is because, when the customer sees queue decreasing, it generates an effect of "attraction of question", increasing the demands. The new increasing of waiting time begins to arise the phenomena of balcking, with customers that, rather than waiting two months or more for a hernia operation, they decide to turn to other hospitals. The distinctive idea, proposed to the market can be declined in different meanings: -

Sale of a quality service that it is able to ensure low relapses Sale of a quality service that it is able to satisfy the customer by creating an experience associated with the operations, thanks to o The ability to socialize with other patients, almost creating a sense of "community" among all customers who have undergone this operation o Design a service that gives a sense of "holiday" (the message that the clinic wants to give its customers is not that of a place where they go to be operated, but a sort of holiday from which they will come out better health) o Sale of a service "with lower and predictable waiting time" o Sale of a service "with reasonable prices" than the competitors

We have to underline which are the structural, organizational and management levers that were used to configure the operations and the Service Delivery System, to support and align this concept. STRUCTURAL (TECHNOLOGICAL) CHOICES Look at what is the structure of the clinic: -

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The rooms are all doubles because the goal is to make customer socialize (more than two beds would be maybe too much) There are other points of contact, such as the TV room and the tea room: all are elements that favor the contact between the customers; even if they bring other benefits, such as savings, the objective of the design was firstly to create a configuration to permit and encourage the encounter between people Great attention to all the elements that can promote (or compromise) recovery patient. An example can be the design of stairs "special", whose step was lower than normal to allow the customer, recently operated, to take the stairs. This solves the trade - off between the need to immediately resume the walking of the patient recently operated, and the danger of exceeding to do these movements.

Note that, this goal of socialization, is not a policy that characterizes only management of patients, but also physicians and internal staff, were strongly encouraged to exchange opinions and to work in teams. To support this move, the operating theater/surgical unit is not structured in a "classical" way, but it follows a "U" configuration, such as that of the manufacturing cells:

In the first case, the arrangement makes it almost "natural" the interrelationships and exchange of views, whenever there is a problem or you need it, because the different rooms are virtually "facing" one upon the other; on the contrary, with operating blocks "classics", in series or positioned on parallel planes, these practices do not flow spontaneously.

ORGANIZATIONAL CHOICES

Focusing the attention on the two steps outlined, which represent the peculiar aspect of the process -

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The presentation of the operation is an activity that aims to explain to the customer how to perform it, risks and implications related to it. This allows both to reduce the anxiety associated with the intervention (for example, the fact of communicating a mode local anesthesia, rather than total, gives the idea of a less invasive procedure) and to give transparency on what will be done. However, the patient is agitated and so he will clearly consider all these efforts made by the clinic. This activity, therefore, does not reach its objectives, since the customer is still anxious. It is for this reason that, immediately downstream there is the meeting, in the lunchroom, with other patients and surgeons of the clinic. The process is designed so that the client, before being operated, has a chance to meet other patients, part of which has already suffered what he will undergo; only in this way, he can see "for himself" the real effect: through a peer to peer communication. The results they set out to achieve with the preparation activities are actually achieved in this second time.

This design logic relies on the fact of having the client within the Service Delivery System. For the company is an opportunity to establish with them a relationship of co-production: in the case, the co-production is linked precisely to the fact that the activity of anxiety reduction of the customers is conducted effectively by the same other patients who, therefore, appear as providers of the service. A second, very important, aspect concerns the skills of human resources, which can be divided into -

Medical staff Nurse.

As for physicians and surgeons, it should be emphasized that Dr. Shouldice, handle personally the examination and evaluation of possible candidates. A doctor must have a number of key elements and prerequisites in order to work in the clinic. First of all, there must be a willingness to work, for a long period, on a specialization: since, the clinic, offers only the cure of hernias, the doctor goes in must be a type of person who has the goal of learning to do the same type of operation, based on the experience gained over time. Dr. Shouldice does not look for

"first women" or doctors seeking to become prominent members of the house staff, but surgeons who, as mentioned, prove motivated to become more and more experienced and talented in performing some type of intervention, likely to work in a team and willing to establish a long-term relationship with the clinic. Within the Service Delivery System company exists the Shouldice procedure that has to be respected so all doctors must adapt to it and this is a further focal point in the selection criteria. Who is hired must be clear about this aspect because not respect what is a process and a proven methodology, means disregard what are the expectations of the customer (which, in essence, do get the service because it is "attracted" by this procedure). However, this procedure does not rely on a static and unchangeable dimensions so for any possible improvement a responsible team has been delegated to verify the validity, by testing it on a sample of patients, measuring the results, and coming to the conclusion on whether, such an improvement, was able to significantly change the effectiveness of the final result. Who works for the clinic, must be moved by this "pleasure" and aim to perform, always better, this procedure: the “good” doctor is not who can do things always different and always in the best way, but one that is capable of performing, in a more and more precise way, the same procedure. Of course, in exchange for these "impositions”, there are a number of benefits for doctors, such as: -

Low variability of work schedule (orario di lavoro) Sporadic work in the week – end Possibility to spend more time with the family and have more free time Salary "above average".

Speaking of the nursing staf, however, it is necessary to highlight three aspects: 1. low turnover rate: in general, those employed remains, in clinic, for a period of time long enough. 2. it is a lot of work "context": unlike other hospitals, in fact, patient care is easier, almost "nice" (as mentioned, who was operated is already self after a few hours, without requiring special care) 3. In addition, the clinic is able to ensure a good salary to its nurse, while containing overall labor and personnel costs. Unlike a "classic" hospital, in this case it is possible to have a ratio between nurses and patients below a certain value thanks to the type of approach used post - operation. Finally, it is worth highlighting the strong cohesion that exists among the entire workforce. While in traditional hospitals there is a strong competition between the various work teams, here it developed a strong sense of belonging and connection, as if to form one great family, in which each one has acceptance and respect for any other colleague. An example of this principle is what happened when the nurses were caught thefting in the guest rooms: instead of dismissing her, Dr. Shouldice has decided to treat the matter in a completely different way. He called the nurses to talk, has made it clear that, by their action, she was ruining the hospital image, but he also said that, the whole clinic "rely on her". So he invited her to remedy the mistake restoring what had been taken away and apologizing , keeping, however, their place of work. This makes it clear just as the objective of cohesion and shared objectives is fundamental. The clinic does not want to communicate to their employees, a feeling of continuous monitoring and observations but Shouldice’s want to make employees feel part of a family and any error is recoverable. Summing up: -

Highly standardized process, allows low recurrence Reduced number of nursing staf and low turnover, given the fast and autonomous rehabilitation Personal built as a family, we try to analyze and solve problems together (see theft) Team Working among the medical staff

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very long selection carried out directly by Shouldice: you need to find reliable and highly motivated personnel especially among surgeons, who must accept the idea of focusing on a single task Strong customer sharing in the process: the nurses have a duty to inform clients about the characteristics of the operation, to illustrate the process and reduce anxieties and fears

DELIVERY MANAGEMENT ELEMENTS It is interesting to point out how to manage waiting lists. Having designed a system that manages the queue building a "waiting list" of patients is of great benefit to the system because, over the years, it was possible to gather information about different clients which, when analyzed, they made it clear what are the key variables on which to focus in combining the right pairs of people to the rooms. The waiting list does not appear transparent to the customer, and thus gives the possibility not to follow it in an absolutely rigid way. For example, if it is observed that the type of work is one of the dominant elements for socialization, by requiring this information to customers who queue up, you should go to shelter, in the same room, customers similar from this point of view. To do this, it is often necessary to "adjust" waiting lists with micro displacements: if, instead than two months, a customer wait two months and one week, but this is done to try to match it to another similar person, that does not generate dissatisfaction. Summing up: -

Using the questionnaire in order to make a quick pre-selection of customers and weed out those who are not eligible or have not external inguinal hernias Matching patients in rooms based on common features to increase the ability to socialize. This combination is easier thanks to the long waiting lists that allow you to choose from a large number of customers

IMPROVEMENT ALTERNATIVES PROBLEM: the clinic has reached a point where, the demand that is found to have, is very high; so it makes sense to ask, whether it is advantageous to use the opportunity to expand capacity and, if so, how. The advantage in expanding capacity is clear: being a leader in a niche segment, an increase, even of medium size, will have no problem to be saturated. However, we must see if there are alternatives that reconcile the increase in the rate of service without generating misalignment in service offering and operations management compared to market requirements.

1. Perform operations on Saturday Adding 1 day during which it would be possible to carry out the operations, the capacity would increase by 25%. This logic, however, tested for a certain period, has not given the desired results, for a variety of reasons: -

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First, not all surgeons were willing to accept it, because it contradicted what was promised initially (little work in the week - end, more free time to devote to the family ...) Shouldice tried only with doctors who had accepted this condition. What happened was that you came to form two sub-groups within the medical staff: those who had agreed to work on Saturday, who were paid to a greater extent, and that they felt "more important", and those who, instead, did not accept this condition who felt a bit 'as the "black sheep" of the situation. It is clear that this scenario disrupted what was the principle of cohesion and "big family" to the philosophy of the company In fact, what occurred was not a rise in demand for operations of 20% (proportional to the increase of the capacity), but only 2%

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No consideration was given to the fact that, even though work is carried out on Saturday, there was a whole range of external accessory services that were only available from Monday to Friday, and that, therefore, were not able to give their support when working on Saturday.

Although the solution was soon abandoned especially for disadvantages in terms of group cohesion, he tried to analyze why there was an increase in demand so low than he had expanded. This was due to a deficiency in the analysis of the characteristics of their process and their system.

The system, as a whole, is similar to workstations in series with intermediate bufers so, watching the process in a strictly sequential way, the bottleneck was represented by phase which involved operating activities (deciding to expand time "devoted" to the interventions, he thought you would be able to meet increased demand). Yet, that was the economic bottleneck (the most expensive stage), but not the physical one that, instead, was represented by rooms. Although the capacity of operating rooms had increased, it was not taken into account that they would not have been able to cope (in terms of number of rooms) to 4 days of hospitalization of the customer for an increasing in demand more than 2%. Therefore, all the requests in addition, still had to be put on the waiting list. Hence, if you want to increase the capacity, it is necessary first of all to adapt the number of rooms and, only later, adapt the service rate of operating rooms. To solve the solution you can: -

convince surgeons to stretch a bit 'more their time work during the week assume new surgeons.

2. Opening a new center Go to open a second clinic (maybe outside of Canada) is an alternative that could be viable even in terms of economic and management, but not from the strategic and operations point of view. It requires to be able to replicate simple "hardware" elements of the current one (patient rooms, the structure of the operating blocks, stairs ...). Much more difficult (if not impossible) will be bring even "software" aspects: the cohesion, the relationship with patients and confidence in the procedure, are all elements that, only the current headquarters, has been able to build over time. The procedure Shouldice and the process that accompanies the customer within the system are now established and winning mechanisms. Opening a new office, hiring new surgeons and nurses, all these elements will be absent for a certain period of time. It’s not a question of "teaching": you can even try to do training but you are referring to these mechanisms as a vehicle for creating a potential competitive advantage, as is the current clinical, it is clear that in the new location, this will not happen until after a certain time horizon. To accelerate progress along the experience curve, they can think of "shuffling" resources (by moving part of the expert staff in the new office having this way the same human resources mix in terms of experience and new hiring). But this, at least in the short - medium term, could mean performance degradation for the present location and non-excellent returns in the new one The key point of this observation is that the system that has been created inside the clinic, has characteristics that do not derive from the mere application of procedures but they are the result of an

evolution which, if not retraced, it will never be able to give the same results. The more behaviors and activities are coded and codified (standardization towards mass service), the easier it is to replicate them. On the contrary, if a system is characterized, for the most part, with professional and not coded elements, it will be very difficult to implement an expansion. For all these reasons, the alternative opening of a new office is not viable: the most sensible option is to develop a long term plan that will lead to implement a series of improvements leading to grow slowly, ensuring the maintenance of the ranking position both in the field and in the World.

OBSERVATION: An alternative to these two would be to diversify their business in terms of the variety of operations offered to customers: introducing a new procedure for another type of operation would be definitely beneficial and would more easily to overcome cultural barriers mentioned above. Of course at the cost of a more complex organization, management and operations. 3. The advance of the competition PROBLEM: there are a number of small clinics that can provide the service to other conditions (such as, for example, the admission "day hospital "), selling themselves, however, as achievers of the procedure Shouldice. These new institutions, though they offer a more efficient service, do not pose a threat to the operating company because they are not able to offer the same concept. They do not propose an offer that goes back to the intervention as a "holiday”, n...