SHOULDICE HOSPITAL CASE SUMMARIZED PDF

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SHOULDICE HOSPITAL CASE Distinctive Features of the Hospital/Clinic Quality

Time

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 have better "quality" than the others -Rate of non-resolution equal to 1:20; the message that it communicates to the customer is, then, that "here, the problem will be solved " -Quality is related to two key levers: A. 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 B. Skills: Capable staff with high skills, and with certain characteristics and prerequisites is important for Internal quality and customer commitment.

Unique Offer in the Market

Secondly, there is the aspect related to the 1. Quality of service as time, which can be analyzed on three mentioned before. dimensions: 2. Customer Experience: 1. "How long it takes," or the length of A. The ability to socialize with staying in the clinic and the period of other patients, almost recovery. In this case, these schedules creating a sense of represent a compromise between those of "community" among all traditional hospitals, much longer, and customers who have those of emerging clinics that propose undergone this operation interventions even in "day hospital" B. Design a service that gives a 2.”Variability and Predictability" of such sense of "holiday" (the message that the clinic timing: just because, the customer is wants to give its customers organizing its commitments according to is not that of a place where the length of staying envisaged by the they go to be operated, but clinic. It emerges as this is one of the a sort of holiday from which strengths of the Shouldice’ procedures, they will come out better capable of ensuring a recovery time health) absolutely predictable and not very variable, which is approximately of four C. Sale of a service "with lower days and predictable waiting time" 3."Queues": Queues are not long in this case, because it is a nonemergency surgery D. Sale of a service "with reasonable prices" than the Note: This aspect does not seem to be competitors 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.

Structural, Organizational and Management Choices STRUCTURAL/TECHNOLOGICAL

INFRASTRUCTURAL/ORGANIZATIONAL

1. Double Rooms: the goal is to 1. Presentation of the Operation: It is an activity that make customer socialize (more aims to explain to the customer how to perform it, than two beds would be maybe risks and implications related to it. This allows both to reduce the anxiety associated with the intervention too much) and to give transparency on what will be done. 2. TV Room and Tea Rooms: These Immediately downstream there is the meeting, in the lunchroom, with other patients and surgeons of the elements favor the contact

DELIVERY MANAGEMENT 1. Managing 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

between the customers; even if clinic. The process is designed so that the client, they bring other benefits, such as before being operated, has a chance to meet other savings, the objective of the patients, part of which has already suffered what he design was firstly to create a will undergo; only in this way, he can see "for himself" configuration to permit and the real effect: through a peer to peer encourage the encounter communication between people This design logic relies on the fact of having the client within the Service Delivery System. For the company is 3. Design of stairs: Great attention an opportunity to establish with them a relationship of to all the elements that can co-production: in the case, the co-production is linked promote (or compromise) precisely to the fact that the activity of anxiety reduction recovery patient. An example of the customers is conducted effectively by the same can be the design of stairs other patients who, therefore, appear as providers of the "special", whose step was lower service than normal to allow the 2. Human Resource Skills: customer, recently operated, to A. For physicians and surgeons: take the stairs. This solves the - Dr. Shouldice, handles personally the examination and evaluation of possible candidates. A doctor must trade - off between the need to have a number of key elements and prerequisites in immediately resume the walking of the patient recently operated, order to work in the clinic. First of all, there must be a willingness to work, for a long period, on a and the danger of exceeding to do these movements. 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 4. U-Configuration of OT/surgical unit: this goal of socialization, is operation, based on the experience gained over time. not a policy that characterizes - Within the Service Delivery System company exists only management of patients, the Shouldice procedure that has to be respected so all doctors must adapt to it and this is a further focal but also physicians and internal point in the selection criteria. staff, were strongly encouraged to exchange opinions and to - Who works for the clinic, must be moved by this "pleasure" and aim to perform, always better, this work in teams. To support this procedure: the “good” doctor is not who can do move, the operating things always different and always in the best way, theater/surgical unit is not structured in a "classical" way, but one that is capable of performing, in a more and more precise way, the same procedure. but it follows a "U" configuration, such as that of the - Of course, in exchange for these "impositions”, there are a number of benefits for doctors, such as: manufacturing cells. the arrangement makes it almost a. Low variability of work schedule b. Sporadic work in the week – end "natural" the interrelationships c. Possibility to spend more time with the family and exchange of views, and have more free time whenever there is a problem or d. Salary "above average". you need it B. For Nurses: - Reduced number of nursing staff and low turnover, given the fast and autonomous rehabilitation - Personnel built as a family, we try to analyze and solve problems together (see theft case) - Team Working among the medical staff - 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

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. 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 preselection 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 RECOMMENDATIONS 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: 1. 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 ...) 2. 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 3. 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 buffers 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: a. Convince surgeons to stretch a bit 'more their time work during the week b. Hire 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. Increasing Competition 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”, not being able to offer customers the same "experience": if there is an equality of outcome, the experience level associated is much lower. The institute Shouldice will always offer more value, then losing very few market share to newly emerging. The real problem is the fact that these clinics present themselves as achievers of the Shouldice technique. Just because there may be an incorrect application, the threat may be to an indirect loss of image: the world of services mainly relies on word of mouth so, the fact that there are clinics that perform the procedure without compliance, could ruin the "name" of the same procedure (currently recognized as "best practices" for hernia surgeries). To try to prevent this eventuality, the ideal solution would be to establish a kind of cooperation with these clinics: if they want to promote themselves as applicators of the Shouldice technique they should send their doctors to the center in order to learn the "native" application, train and get the certification.

This would benefit both parties: - Small clinics, they could use the fact that you have a personnel certified by "Shouldice" as a marketing tool - Shouldice, there is the opening to a complementary business (the certification), as well as the security of not incurring in possible losses arising from a distorted application of the procedure CONCLUSION Shouldice is a fantastic example of alignment between operations and market . It is also necessary to point out that this alignment is bidirectional: it is not only the company that chooses the configuration according to customers’ needs, but also the fact that, based on these choices, the company is able to understand what market is more appropriate to serve. It emerges as the company can "say no" to all those customers who do not appear to be suitable for its Service Delivery System: Customers overweight, with cardiac risks or who have suffered recent operations, they are not accepted (selection process of customers). In fact, they sent a questionnaire to the potential patient that, once completed, will allow the institute to determine whether it represents a customer actually suitable to be treated according to the procedures. It is essential, in the market, to stay focused: the Shouldice Clinic’s Service Delivery System is the best for that particular concept on which it was developed; who is not suitable for that concept, it can’t be served....