Understanding the Environment
External Competition
The competition will have a tremendous influence on the strategic orientation followed by St. Anthony Medical Center. As the case demonstrates, St. Anthony Medical Center is experiencing tremendous competition from more than 100 businesses that already operate inside the Minneapolis area. Redeemer Health and Rehab, Augustana Health Care, Birchwood Care Home, and The Kenwood are among the facilities. Such a huge number of players intensify competitive challenges as they operate as an alternative to St. Anthony Medical Center. In addition, another hospital, a 50-bed for-profit acute care hospital, is being built in the Seward area. As a result, revenues are expected to be driven lower. The rivalry for human resource department will escalate in ways that the business will strain to manage its employees. As a result, St. Anthony Medical Center must rethink its strategy in order to maintain its market share. In some, the institution is and will continue battling intense competing forces.
Staffing
The case reveals that St. Anthony Medical Center has personnel issues. Currently, the organization appears to be unable to fill four physician positions. Furthermore, the Vice President of Medical Services (CMO) claims that the institution is unable to replace retiring doctors. The Vice President, in instance, alleges that they are unable to find an internal medicine specialist and another who specializes in thyroid disorders. Furthermore, St. Anthony Medical Center is unable to recruit an infectious diseases specialist, a neurologist, a traumatic brain injury specialist, or a generalist. Additionally, the medical facility has struggled to recruit a generalist who can work a third shift. These personnel problems are detrimental to St. Anthony Medical Center in two key aspects. One, a lack of enough human resources might result in process disruptions and associated expenditures. Secondly, productivity will fall, a concern that can worry patients.
Stakeholders
St. Anthony Medical Center is a component of a huge stakeholder ecosystem. Because they receive the patients directly, the patients are part of the stakeholder system. Second, because they impact the internal market, competitors such as Ebenezer Care Center and Richfield Health Center are also stakeholders. Third, because they provide the services, employees are also stakeholders. Fourth, health regulators are stakeholders because they set health guidelines and policies.
Organizational Capacity
St. Anthony Medical Center has the institutional capability to deliver services. Even though it has certain human resource issues, it has more than 400 physicians, implying that it can accomplish some of its goals. However, the institution faces challenges in other resource areas. Organizational capacity is described as the ability of an organization to execute services satisfactorily while also anticipating future opportunities (Abatecola, Caputo, & Cristofaro, 2018). The entity is particularly financially stressed because it is unable to offer competitive salaries. Along a similar line, the absence of financial resources has deprived the institution the chance to replace vacancies immediately.
Organizational Analysis
Porter’s Five Forces of Competitive Position Analysis
Threats of New Entrants
Porter’s five forces foundation is used to measure the level of rivalry in an industry. New entrants pose a significant challenge. Several entities are currently intending to enter the market, meaning that competitive factors will intensify (Abatecola, Caputo, & Cristofaro, 2018). However, due of the significant initial capital required, one could claim that the threat of new entrants is negligible. There aren’t many groups that can quickly deploy the necessary resources, which inhibits new market entrants. Again, the health sector is highly regulated, which makes entry more difficult. Furthermore, high switching costs make it difficult for new entrants to reach critical mass and prosper.
Buyer Power
Buyer power is high since they have choices to pick from. This is because the case reveals that the area has over 100 entities that offer identical services to St. Anthony Medical Center, so consumers have the power to choose the lowest. Also, the undifferentiated products further diminish the hospitals’ power. Again, the undifferentiated products lower switching costs, meaning that patients can easily seek services from competitors. Besides, the sector is formed of many tiny firms, meaning that no particular organization controls this market.
Supplier Power
Supplier power in this business is significant in part because the industry is dominated by a large number of suppliers. This structure of the market gives the suppliers the power to regulate prices, timelines and quality measures. The consumers are likewise fragmented, meaning that they procure independently. This characteristic denies the health organizations the power of large groups. Furthermore, switching costs on part of the health organizations are substantial partly because they are connected by contracts. Some products may not have replacements, an issue that further boosts supplier power. The story also indicates that suppliers of labor (workers) are tough to acquire. This issue may require St. Anthony Medical Center to give greater wages to accomplish its human resource objectives.
Threat of Substitutes
The threat of substitutes is considerable in this industry. One of the reasons is that the market has over 100 participants, indicating that its patients can readily seek services elsewhere. Secondly, switching charges are modest, a factor that makes it easy for people to switch from St. Anthony Medical Center. However, one can argue that the threat of substitutes is low because medical services have no effective substitute.
Rivalry
The player rivalry is high in part because the number of players in the industry is quite high. The instance indicates that there are over 100 players, an issue that might impede the process of recruiting and retaining clients. Additionally, there is a strong possibility that the players adopt identical strategies and the lack of unique products further complicates rivalry.
SWOT Analysis
Strengths
- Has a large human resource;
- St. Anthony Medical Center With great experience in the industry;
- The company works in a large urban setting, an aspect that can ease customer acquisition;
- Its vast size can offer it an edge over lesser competitors.
Weaknesses
- Unable to fill its personnel resource on time;
- Unable to fill its personnel resource on time;
- Inadequate work planning strategies;
- Poor salaries.
Opportunities
- Offer higher compensation to recruit high-quality physicians;
- Expand to more geographical areas;
- Introduce e-health and telemedicine;
- Focus on cost-effectiveness.
Threats
- Increased competition;
- Dissatisfied customer;
- Resource restrictions;
- Burn out among its physicians.
Strategic Framework
The strategic framework is tremendously advantageous to St. Anthony Medical Center in various ways. One, it gives the management a full perspective of the organization and the difficulties therein (Ginter, Duncan, & Swayne, 2018). This expanded visibility will help the entity to handle the problems from a cohesive and in-depth perspective. Secondly, the strategic framework will offer the center a feeling of direction. Thirdly, the strategic framework is useful as it helps St. Anthony Medical Center to have more coordination and management of activities. This feature will ensure that the medical center will work sufficiently on every aspect of the project. The efficiency is crucial in the sense that it will equip St. Anthony Medical Center to utilize its resources and maybe, increase its competitive forces. Fourthly, the strategic framework is vital as it will ease decision-making (Ramakrishnan, Kathuria, & Saldanha, 2020). It connects all project stakeholders in a way that simplifies information flow and, in the end, assist decision making. Besides, the strategic framework would allow St. Anthony Medical Center to be proactive. The example demonstrates that the health center is experiencing multiple environmental issues, which, if not appropriately addressed, can trigger market withdrawal. Therefore, the strategic framework enables the entity to have proactive visibility into existing and future circumstances, making it feasible to pre-emptive concerns. Overall, the strategic framework will allow St. Anthony Medical Center more control over its internal activities, and maybe, boost its profitability and sustainability.
Potential Implications
Assuming that nothing is employed, there are various implications among them lower competitiveness. The Porter’s five forces framework research suggests that competing factors are rising, so failure to strategy will see St. Anthony Medical Center lose in market position. Therefore, the center should perform an intensive competitor analysis to determine measures to protect its market share. Secondly, the firm should change its human resource management policies. The environmental study suggests that the center is unable to fill vacancies timely. Therefore, the business should offer competitive wages to ease this recruitment difficulty. Thirdly, the data suggests that St. Anthony Medical Center is suffering competitive pressures. A 50-bed capacity hospital is being erected in the Seward neighborhood. The inference is that the company should consider building new centers to offset the threat provided by new entrants. Having more operational centers may help equip St. Anthony Medical Center to attain efficiencies of big scale.
References
Abatecola, G., Caputo, A., & Cristofaro, M. (2018). Reviewing cognitive distortions in managerial decision making: Toward an integrative co-evolutionary framework. Journal of Management Development.
Ginter, P. M., Duncan, W. J., & Swayne, L. E. (2018). The strategic management of health care organizations. John Wiley & Sons.
Ramakrishnan, T., Kathuria, A., & Saldanha, T. J. (2020). An integrated model of business intelligence & Analytics capabilities and organizational performance. Communications of the Association for Information Systems, 46(1), 31.
