Harvard business case analysis

Harvard Case

Shouldice Hospital: A Case Study in Expansion

The Shouldice Hospital, as it is described in the case analysis serving this discussion, is a highly progressive hernia treatment facility which not only specialized in this particular surgical procedure but which also provides a unique setting for convalescence. Through the promotion of ambulatory recovery and the creation of a context which is both clinically excellent and highly social, Shouldice offers a positive healing environment. The hospital experiences good results, positive patient feedback and a successful business model. Indeed, as confirmed by the Navjeevan Hospital (2011) sponsored Hernia Help Center, "Ambulatory Hernia surgery allows patients to walk as much as possible, which helps in faster recovery." (Navjeevan Hospital, p. 1) The positive outcomes and glowing reputation associated with the mode of surgery and the Shouldice Hospital respectively are central to this discussion. As the account hereafter will demonstrate, the greatest challenges before Shouldice largely involve finding ways to better sieze on and build upon its successes.

Major Issues:

Many of the most pressing organizational issues facing Shouldice involve the hospital's continuing growth. For the hospital's chief administrator, Alan O'Dell and for Dr. Shouldice (son of the founding Dr. Shouldice), most of the challenges facing the healthcare facility involve handling an constantly growing backlog of prospective patients. In response to this and several other growth-related needs, Dr. Shouldice indicated the need to increase "the hospital's capacity while at the same time maintaining control over the quality of the service delivered, the future role of government in the operations of the hospital [and] the use of the Shouldice name by potential competitors." (Heskett, p. 11)

Essentially, this denotes that the area in which Shouldice most needs to improve is in remaining abreast of market opportunities as they continue to emerge. This is especially true given both the commonality of the procedure and the increased popularity of the minimally invasive procedure in which the Shouldice facility specializes. According to the article by Landro (2012), more than one million patients a year undergo a hernia repair procedure. Landro goes on to indicate that "studies show that patients undergoing minimally invasive surgery have a quicker recovery and less short-term pain than with open repair." (Landro, p. 1)

This denotes the healthy marketplace within which Shouldice operates, as does the hospital's own difficulty in keeping up with prospective patient backlogs even as it has taken steps for modest expansion of its capacity. Though it certainly can be argued that this is a good problem to have, there is reason to suggest that the accommodation of market demands is necessary for the long-term survival of the hospital's unique treatment and recovery model. Long patient backlogs and growing wait times for threaten to undermine the characteristic efficiency and accommodation that are part of the Shouldice approach.

Research also confirms that patients and healthcare researchers are increasingly finding cause to support the ambulatory care philosophy in which the Shouldice Hospital's treatment regiment is rooted. For instance, a study by Dhumale et al. (2010), finds of the ambulatory hernia procedure that in the scope of its study, "complication rates were low and similar to those obtained in other specialist hernia units. More than 90% of patients were satisfied with the service and would recommend it to a friend." (p. 127)

This denotes that Shouldice hospital can anticipate continued expansion in its market niche. This, in turn, should suggest that its patient backlog will only continue to grow. There is not only a need to address the growing demand for its services but there is likely to be a continuing need for Shouldice to address constantly advancing market demand for its particular area of specialization.

Another issue noted by the case study is that while Shouldice has been innovative in its approach to patient recovery and socialization, it has also become somewhat complacent as a consequence of its success. Consistently positive treatment outcomes have prevented Shouldice from otherwise pursuing improvements in either its procedural approach or the orientation of its personnel. The demand to expand its treatment capacity should also be seen as an opportunity for changes in its medical proceduralism. The fact that, according to Dr. Shouldice, the hospital must bring onboard a new chief surgeon denotes a particular opportunity for this change.

Possible Solutions:

Ultimately, it appears that the only sensible approach would be the physical expansion of the facilities already in existence in Toronto. This solution is the idea response to Shouldice's unique situation for several pressing reasons. Most particularly, the fact that there is a high market demand already in this context denotes that Shouldice is ideally situated to capitalize on a growing niche. The hospital's swelling wait-list suggests that any concerns over the cost of expansion are overshadowed by sufficient demand.

Indeed, this seems the only appropriate solution given that the success of Shouldice to this point denotes that it possesses the resources to undertake expansion and that its reputation makes it the best candidate to accommodate public demand. Also, because clientele from outside of the region have already expressed a willingness to travel to its Toronto facilities and given the centralized nature of its operation, it seems appropriate to recommend the expansion of the existing location rather than the groundbreaking on a new and remote location.

It will be crucial that any new facility be constructed be equal or greater standard for the maintenance of consistency and reputation. Shouldice has arrived at its point of success by placing an emphasis on this high level of quality and effective care. Therefore, it would be more destructive to attempt to accommodate greater numbers of patients at the expense of the quality of either care or facilities. Therefore, the execution of this expansion should be conducted according to the findings of current administrative leadership, with the intent to improve the bed capacity at Shouldice by 50%. This will comprise a demand for several distinctive initiatives.

First and foremost, this expansion will require Shouldice to begin to tap realistic hiring avenues. One of the primary reasons that this proposal suggests facility expansion over other alternatives is because this approach should require further personnel recruitment.

It is suggested that new recruits and veterans be distributed across both the old and new facilities so that those with experience can serve in a position of mentorship to new hires. Given the demand for work with Shouldice, it should be feasible to bring aboard a larger nursing staff. Likewise, Shouldice might consider such avenues as its own patient population, which includes a comparably significant percentage of physicians, for doctor and surgeon recruitment.

Likewise, this expansion should be seen as an opportunity both to promote innovation within and without the organization. In addition to promoting training programs for existing personnel in order to keep the staff abreast of emerging best-practices in the external hernia treatment field, it is also important for Shouldice to initiate an educational exchange with other physicians and facilities. This would serve a dual purpose. At a time of reformation, Shouldice could take the opportunity to open its organization up to industry innovations by remaining in closer contact with outside facilities and research organizations.