Strategic management and SWOT analysis of Methodist Healthcare

Health Care Management

Environmental Factors

In planning its strategic management effort, Methodist Healthcare should take into account several environmental factors. Primarily, the external environment needs to be assessed for its climate in accommodating and integrating the services provided by Methodist Healthcare. As such, any problems related to the current environment need to be eliminated. A current problem is for example that the variety of businesses and structures historically created to address specific health trends over the past decades, no longer serve this specific purpose. The diversity of these systems is too large to be effective in terms of the current, needs, vision and mission of Methodist Healthcare. This lack of focus tends to drain energy from the core business.

Environmental factors that therefore need to be taken into account to return to a more acceptable sense of focus include Market position, financial performance, managed care positioning, staff commitment, and required resources. Issues of the internal environment that need to be taken into account include the organization's mission, vision, values, goals, and strategy to reach the goals. With an integration of all these elements, Methodist Healthcare can position itself strategically in a way that both addresses the community's needs and ensures the organization's success.

2. SWOT Analysis

Internal Strengths

Internal strengths include an understanding of the importance of effective communication among branches and managers of the organization. Methodist Healthcare is a patient-focused organization, priding itself upon its excellent customer service. As such, internal communication plays a vital role in delineating the exact standards of customer service required by all associates.

In terms of infrastructure, another strength includes state of the art, standardized information technology, such as the Cerner Millennium package. The system was selected for its ability to provide solutions to most of the initiatives planned for the organization. Basically, the core strength of the organization is its focus on excellence in patient care - all other strengths lead back to this paradigm.

Internal Weaknesses

The greatest internal weakness faced by the company is in the area of its finances. While many financial analyses show favorable growth, the current revenue still does not sufficiently cover elements of strategic planning for the future. On issue included in this is the projected information system focused on helping Methodist Healthcare attain its goal of service excellence.

External Opportunities

Methodist Healthcare has historically expanded very successfully. The organization currently has successful associates in several locations, including Tennessee and Memphis. A continuing trend of consistent and clear communication in terms of vision and goal ensures good relations with these associates internally, and with patients externally. More expansion opportunities are explored and likely to be implemented successfully.

External Threats

External threats exist mainly in the form of the organizations competitors. The strongest of these is Jackson Hospital in Madison County, with a consistent market share of 46%-47%, as opposed to Methodist's share of 26.1%. Methodist's growth in terms of the market and patient numbers are encouraging in this regard. The only potential problem relates to finances, which can be handled by more careful planning and increased revenue strategies.

3. Critical Success Factors

Methodist Healthcare has modified its vision to integrate with its goal of differentiating the organization from others of its kind on not just a local scale, but also on a regional scale. As such, the vision of the organization is to develop its patient and customer care to the highest level of excellence. Customers include not only patients and their families, but also associates and physicians, who are the focus of the new vision, to create the preferred organization where physicians work to provide the most excellent of service to their customers.

Critical success factors for accomplishing these goals would therefore include a thorough analysis of customer concerns and needs, and how these integrate with the abilities and needs of physicians; a well-developed information system that can process such data; and a sound financial basis from which to support all analysis, equipment and technology needs.

5. Communicating the Vision

Methodist's product is the organization's primary contact with customers. As such, communicating this to the public is of vital importance. It should be emphasized that the organization strives for absolute excellence of care in terms not only of outcome, but also in terms of the customer's association with the organization. Price and promotion should be integrated during the communication process. There should be a focus on value for money, as well as the fact that customers are considered on the basis of income and that care takes precedence over income level on the basis of equity. It is also important to focus communication on the regions in which Methodist has a prominent presence. Communication is especially important with establishing the organization in new locations, where competitors are already present. In this, it is important to emphasize Methodist Healthcare's unique focus as opposed to its rivals.

6. Financial Condition

Methodist Healthcare's finances show and improvement with every passing year. From 1998 to 2000, its market share increased from 24.9% to 26.1%, making it the second largest institution of its sort in the region. In terms of fees, the greatest healthcare contributor to Methodist's inpatient cure service database is Medicare. In addition, the organization has agreements with several commercial insurance entities, health maintenance organizations and preferred provider organizations, supplementing its income considerably. A considerable growth in income from 1999-2001 is attributed to a growth in patient numbers during these years. Concomitantly, expenses such as salaries and benefits, supplies and equipment, and provision for bad debts also increased. It is important to note that, while Methodist Healthcare's financial situation is generally healthy in terms of profit, supplementary income will have to be arranged to cover the planned strategies for the future.

7. Recommendations

In order to maintain its strategic momentum, it is recommended that Methodist Healthcare remains focused not only on customer care, but also upon the human resources that provides the utmost of excellence in service. As such, it is necessary to retain hiring practices that adhere to the philosophies and ideals that are established as Methodist's core principles. In this, communication between management and employees is essential.

It is also important to develop the educational initiative that has been projected for the organization. As such, education takes place in very practical terms, and quality assurance follows. Educating all physicians and other employees regarding the principles of excellent patient care will raise the public confidence in Methodist Healthcare.