Shouldice Hospital Case Study Solution

MEMO

To: Dr. Shouldice

From: Anshul Joshi

Date: 9 May 1983

Subject: Shouldice Hospital Limited

INTRODUCTION

Shouldice Hospital was opened in July 1945 in Toronto and has been devoted to repairing only external types of Hernias. Shouldice Hospital is not just a hospital but it is an experience for a patient. It’s success can be viewed from the business perspective, quality of healthcare it provides and its level of employee and patient satisfaction. This has led to great competitive positioning, the hospital is falling victim to its own success. You are currently operating over capacity with a backlog of 1,200 scheduled operations. You are looking at the possibility of increasing capacity through a number of options including

The high level of performance of the hospital is due to its smoothe process flow. Shouldice has reduced variation in the service it provides and reduced the throughput time. This has resulted in the classification of Shouldice to be a service factory. The narrow focus makes it easier to take a holistic view of care, as needs and variation are limited.

The selection of patients with external hernias, who had not previously operated on ( approximately 82%on, reduced variations of treatments required. The selection and training of surgeons resulted in limited variation in the operating procedures performed on patients. Given the functional nature of the service and the stability of supply of inputs, an efficient supply chain is achieved.

Quality control plays an important role in this environment, especially in the areas of surgical staff, nutrition, employee management and administrative process. The caliber of surgeons is ensured through their selection by Dr. Obney and their subsequent training in the Shouldice method. This complements the process of rotation of staff through different teams and sending patients with recurences to their initial physicians to learn from their mistakes. The employees are highly encouraged to take regular breaks between their operating

This seems a long and strategic process and any haste decision could destroy the brand image in the market. In order to have the same quality, the staff needs to be trained effectively and the organizational culture needs to be replicated. There is a need to understand the government regulations and the extent of support given by them to this kind of facility.

Diversification: Alternatively, Shouldice can diversify into another service offering which would eliminate the effect of cannibalization. However, this is a high risk, high reward strategy if it can be carried out strategically and slowly to gain expertise of the new offering, process and design. Again, this is a risky option and expanding the existing services seems to be a safer option than diversification or opening up a new site in the market.

I recommend doing a comprehensive market research on the future demand, government regulations, easy to implement design and replicate the organizational culture in various markets starting from U.S to build a long tern strategy of growth for the brand Shouldice Hospital.

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