The threat of competition from companies other than MedCenter would be less likely too. Con a. DHC would be unable to invest in much-needed upgrades to its medical services and would be less likely to offer the extended hours clients are calling for. Thus, the plan could backfire and cause DHC to lose clients.

b. DHC risks losing its reputation, which Worth built as a medical center that did not resort to what she called "crass commercialism," (p. 200).

3. DHC can address both the needs to improve medical services and the need to aggressively market to potential and existing clients.

Pro-a. The middle ground engenders trust among existing clients b. The extension of hours and services is likely to attract new clients before MedCenter lures them.

Con a. DHC may not invest fully enough into its marketing strategy to successfully stave off MedCenter's threat.

b. DHC risks losing clients after investing substantially in the improved services.

Recommend and Justify Alternative

Clearly, alternative #3 is the best method to address DHC's needs. However, DHC must hone its marketing strategy to (a) preserve its reputation as a quality of care center and not as a "crassly commercial" one; (b) secure relations with existing clients using contractual agreements if possible; and - establish solid brand recognition as the leading ambulatory health care center for the downtown area. Worth must mobilize her current administrative staff, keeping extraneous costs to a minimum during this difficult but brief transitional stage.

Preserving DHC's good reputation...

The advertisements do not cheapen DHC's image while raising awareness of the range of services the center provides. The main goal of informational advertisements is to raise consumer awareness that DHC exists so that clients immediately associate DHC with their needs. DHC must also focus on its potentially lucrative long-term relationships with local businesses. Referrals for worker's compensation, and also for employment and insurance examinations, offer stellar opportunities for DHC to entrench itself fully and prevent MedCenter from being able to significantly steal market share. Brand recognition can also be created and maintained by running simple informational advertisements in local health magazines as well as on local radio stations. Placing inexpensive information cards in offices throughout the downtown area would help, and so might changing the DHC logo if necessary.
Analysis Proposed or Used

In terms of financial analysis, DHC needs to evaluate each alternative based on its projected net present value. This will allow DHC to best weigh the costs of each option with the potential rewards. Ultimately, whichever option DHC chooses must be the option that best enhances shareholder value. It should be remembered, though, that the analysis of each option is based on assumptions and that the actual outcome may vary greatly. Therefore, a sensitivity analysis should also be performed on the calculations, to ensure that management understands fully the potential outcomes associated with each course of action.