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In 1983, A Community Hospital closed and then built a new hospital located in a thinly
populated area. The land is owned by the original hospital. The Hospital is a four storey building
that includes all latest innovations that includes all latest innovations healthcare technology. The
First floor includes emergency departments, second floor includes all administrative services, 3rd
and 4th floor contains patient rooms.
For 6 months the hospital operations were chaotic for administrator of the hospital, Mr.
Sam Jones as malfunctioning arranging for new staff.
During this period, Mr. Jones had been getting some interrupting reports from Mr. Cash,
the financial controller, regarding hospital’s financial situation and he decided to settle down
things first before these financial matters. But eventually, in April, Mr. Jones requested Mr. Cash
to prepare all-inclusive report on hospital’s financial position and make a presentation to himself
and Tim Newman, the new assistant administrator.
During their first month, they lost almost $221,000 and lost $58,000 in March.
Accumulated operating deficit $715,000 for 6 months which covered with their bank line of
credit.
I. TIME CONTEXT
· October 1, 1983 when the community hospital started to operate.
II. VIEWPOINT
· The group chose the perspective of Sam Jones, Administrator in the Community Hospital.
SWOT Analysis
Strengths
Weakness
Opportunity
Threats
Total 1 1 3.63
Strengths Weaknesses:
1. Land is owned by the original hospital 1. The hospital is located in a thinly
2. Latest innovation in healthcare technology populated area
3. sufficient numbers of beds to accommodate 2. Lack of skilled employees
patients 3. No proper scheduling
4. The only hospital located on the area
Opportunity: Threats
1. new markets 1. New entrants of competitors
2. new technology 2. Emerging government policies
3. Expansion of facilities 3. increasing price of supplies
4. Increasing number of diseases
Strengths:
1. Land is owned by the original hospital
Owning a land means less cost because there’s no need for rental payments.
3. No proper scheduling
Scheduling is very important in everyday operation of any organization, having no proper
scheduling is a weakness because the number of resources available such as hospital medicines,
staffs, facilities and services prepared will be mismatched with the given demand at that time
which wastes the hospital’s time and money.
Opportunity:
1. New markets
The hospital can try to acquire and provide the latest medical services or cure to people
who have acquired new emerging diseases or sicknesses. The hospital can also add new facilities
or services to cater to a population with rare diseases that can’t be cured in just any hospital.
2. New technology
This is an opportunity because having the latest medical technology can naturally attract
patients since the hospital can offer better and latest medical service and cure compared to other
hospitals.
3. Expansion of facilities
Expanding facilities is an opportunity as it can accommodate increasing number of
patients hence increasing hospital profit or income as well.
Hospital needs to have sources of income to pay their debts. When the hospital provides
rental space for doctors clinic to practice their expertise,it may help the hospital to gain more
profit.
Dropping unprofitable segments can cover the fixed costs so it will not hurt the income of
the hospital. This action will help the community hospital to maximize its facilities. The
customer of community hospital are not all financial capable of paying hospitals bills. Therefore,
to provide their needs that will also help the hospital to increase sales, creating an out-patient
department can help to gain revenue through consultation fees and diagnosing test.
Hire skilled 1 1 2 1 5
employees
Clinic Rentals 4 3 2 3 12
for Doctors
Partner with 3 1 2 2 8
Medicaid
Eliminate 2 4 4 4 14
unprofitable
segments and
expand in
demand services
VII. Analysis of Alternatives
a. Hire skilled employees
Advantages Disadvantages
● More productive
Competent staff accepts responsibilities
due to readiness to work and have the initiative
to finish work promptly.
2. Clinic Rentals for Doctors
Advantages Disadvantages
Advantages Disadvantages
● Attract more customer ● Having common fixed costs
Not all patients are considered to be This will still hurt the profit because
admitted to the hospital. Subsequently, this fixed costs will continue even the other
Outpatient department can attract customers segments have been eliminated.
because they have all the latest healthcare
technology. ● Higher cost
VIII. Recommendation
Eliminating unprofitable segments and expanding in-demand services is the best
recommendation to offer to help the Community Hospital to maximize its facilities and to avoid
further losses. Reduction of unnecessary segments can help make new services line which
contributes to increase the income of the hospital. Although it has its disadvantages, it may be
more efficient to have a well-planned use of spaces in the hospital.
IX. Implementation program
The other problem that the hospital faces is that the administrator hired a newly graduate
into the new hospital. Hospital matters are a very sensitive issue because it involves the lives of
the people, so the hospital should hire skilled staff to facilitate all medical records of patients,
especially since it’s a newly established hospital. Other recommended action is to look for
doctors or businesses to rent spaces in the hospital.This is to maximize its facilities and other
way to avoid further losses or bankruptcy.
It is important to have proper scheduling of appointments and activities because this will
help a person to manage his/her time by listing the entire task needed to be finish. Scheduling
will help each department to know what the highly important activities are.
Capacity planning is also important to know the number of customer that the hospital can
cater because the numbers of demands change overtime. Furthermore, maximizing profit is also
crucial so that they can use the resources effectively and efficiently.