A. The preparation of Scarlet Hospital to compete with future challenges:
The main concern of the CEO Timothy led Scarlet Hospital was the opening of highway services in the area near to their operation between a limited community, Walnut Grove and the complicated metro city, Salem.
The CEO was mainly concerned because the initiation of these services could lead the patients to move out of Walnut in lieu of sophisticated medical services in the metro area. This means that the exposure of the customers for choice is increased.
Thus, with the announcement of a highway service, the CEO called upon a meeting for the senior management so that they could discuss the matter and create remedies for effectively performing the decided strategies to prevent out-shopping to these newly introduced services. The focus was also that the strategy should be on floor before the start of highway services at least by six months.
The senior management followed suit and strategies were developed for advertisement and marketing. Some strategies of cost effectiveness in the form of packages for the patients were also introduced so that they would not move out to Salem. Thus it can be clearly stated that the focus of Timothy was on the preparation of strategy so that he could tackle and win over the potential threats to the success of the hospital (Costantino & Merchant 1996).
B. Potential Lessons for the Scarlet Health Care Executives:
The case of Scarlet Hospital does set some analysis bases, which are:
Evaluating the facts that CEO Timothy is aware of and has given advices, executives should put in efforts to understand the potential threats and the upcoming vulnerability.
The concepts of advertising and marketing for the Hospital seem to be good enough. However, these efforts should have been initiated at the early stages so that sudden potential threats such as metropolitan hospitals in this case could not create as huge an impact as consumer awareness would already be high.
There should be certain strategies for the mitigation of future situations in which only the Hospital CEO seems to be tackling the condition.
Service quality is the center of all activities for the service industry like that of Scarlet Hospital because the customer preference depends on the same.
C. Scarlet Hospital: Evaluation of Michael Porter's Five Forces and SWOT Analysis
It was the year of 1980 when Michael E. Porter developed the Five Competitive Forces’ model.
Since its inception, the tool has been adopted by companies around the globe to assess the structure of the industry in which an organization functions so that strategic processes can be sorted (Sofiane, Francesco, Tim & Alberto, 2013).
In this particular case, the insight for the basing of the model for Scarlet hospital is that there should be a match between the corporate strategy and the opportunities and threats that have been identified in the business environment of the hospital. Specifically, the basis of competitive strategy should be the knowledge about financial structures and the dynamics of change. This is where these forces form the resultant competition intensity and potential profits and feasibility for the business. Taking the Five forces analysis results in the context of Scarlet Hospital, we could say that there are two major areas where the management needs to take crucial decisions and address issues. The prospects of the Company in preset and in future with respect to the industry dynamics are dependent on these forces as per the analysis:
Before the consideration, the focus of the hospital was on the level of competition that existed in the industry and the maintenance level of the hospital regarding the related services due to barriers caused by the competitors. The same is to be continued.
The second is the effective use of power of service, which the Company has been excelling at from the beginning of service delivery. This is where the CEO of the Company, Timothy wants to hit because he knows that this is the aspect that can take the Company to the top and reach that position.
C1. Improvement needs of two forces for the hospital
There are two major business model forces that an organization should focus on for optimal efficiency (Jeffrey & John, 2012). These two aspects are:
There should be organizational focus on competitive analysis and the discussion on starting of new services, which can help tackle competition activities in market.
There should be apt consideration from the organization side regarding potential events in future; external threat control, which is continued with business, substituted by external entities so that cheaper services can be introduced.
One of the important analysis tools is the SWOT analysis, which allows the evaluation of the present situation for the hospital through factual understanding of the following:
Strengths: The service quality being delivered is of standard nature.
Weakness: There are no efforts towards advertisement and marketing and there is absence of well-planned strategy for mitigation. The executives have also been excluded till the CEP intimation as received.
Threats: There are services upcoming from Walnut Grove
Opportunity: There are spaces where the company can benefit extensively from outlining advertising and marketing strategies in detail.
D. Proposed Balance Scorecard Hospital Model:
The suggestion here is to appease the value associated with the model of Balance scoreboard so that capacity can be developed to assist the executives at Scarlet Hospital in the reinforcement of the defensive form of marketing strategies in use (Winter, 1997).
The suggested format for the operating strategies of the Balanced Scorecards Drive can be presented in the given figure.
E. Marketing Strategy for the Hospital:
Leadership choice is crucial for Scarlet Hospital at the moment. The need of the hour is that the senior executives at the hospital be able to measure and identify the priorities of the organization and choose a strategic leader accordingly.
There are high chances that the hospital is going to face some problems with the rise of competition from emerging highway threats with direct connection to metropolitan, which may also eventually take over their customers. Thus, the concern of the hospital should be the development of marketing strategies that summon organizational needs. The strategies are to be developed in such a way that the threat types are mitigated and this can be done most effectively in combination with advertising of the brand and the well-known service quality of the Hospital which have been the Hospital assets from beginning (Jeffrey & John, 2012).
There also needs to be an understanding that there is need of more than just the absorption of target market and there need to be significant advertising activities for increasing awareness t the customers.
The obvious thing is that customers of the local society will definitely be attracted to the convenient metropolitan city to fulfill their needs of the hospital. But, it is also true that in case the hospital is able to provide superior services at reasonable rates, customer retention is possible. Awareness is the key to establishing this practice, which could be done effectively through advertisements of brands and introduction of offer packages to customers (Shapiro, 1999).
E1. The Hospital needs of Marketing Segmentation:
The market needs at present should be the focus of marketing.
There cannot be any other option for Scarlet Hospital than indulging in branding driven advertisements.
There should be provision of special cost packages, which provide effective packages of value for surgery purposes.
There should be capture of market frame under target by using value advertisements or extra packing incentives.
References
Costantino, C. A., and Merchant (1996), C. S. Designing Conflict Management Systems: A Guide to Creating Productive and Healthy Organizations. San Francisco: Jossey Bass.
Jeffrey W. A., John P. M.,(2012), Intelligence Methods and Systems Advancements for Knowledge-Based Business.
Sofiane, A., Francesco P. A., Tim C. M., Alberto D. M., (2013), Fuzzy decision support for tools selection in the core front end activities of new product development, Research in Engineering Design, 24, 1, 1
Shapiro, C.; (2009), “The theory of business strategy.” Rand Journal of Economics 20:125–137.
Winter, S. G., (1997), “Environmental factors Competences as strategic assets.” In D.J. Teece (ed.), the competitive challenge: strategies for industrial innovation and renewal. Cambridge: Ballinger.
