Case Study Description of Cleveland Clinic: Transformation and Growth 2015
The Cleveland Clinic's health care services are internationally renowned for quality. In 2008, The Clinic began to restructure the organization into teams defined around patient needs, rather than traditional medical specialties."Patients First! takes shape as the teams measure and report outcomes, coordinate care, and develop to support improving value for patients. In addition to restructuring care delivery in the hospitals and throughout northeastern Ohio, The Clinic has investments, facilities, and staff in several other states in the U.S. as well as in Canada and Abu Dhabi. Now in 2015, as the Clinic's domestic and international footprint continues to expand, its leadership is also focused in maintaining the Cleveland Clinic brand and providing optimal clinical care. Students can explore strategy transformation, geographic expansion, the process of introducing new measurement approaches, alignment of activities with strategic goals, and issues in leading change both within a company and across an economic sector.
Authors :: Michael E. Porter, Elizabeth Olmsted Teisberg
Swot Analysis of "Cleveland Clinic: Transformation and Growth 2015" written by Michael E. Porter, Elizabeth Olmsted Teisberg includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Clinic Cleveland facing as an external strategic factors. Some of the topics covered in Cleveland Clinic: Transformation and Growth 2015 case study are - Strategic Management Strategies, Growth strategy, Health, Leadership, Performance measurement, Personnel policies and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Cleveland Clinic: Transformation and Growth 2015 casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, technology disruption, digital marketing is dominated by two big players Facebook and Google, central banks are concerned over increasing inflation, increasing commodity prices, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing energy prices, there is backlash against globalization, etc
Introduction to SWOT Analysis of Cleveland Clinic: Transformation and Growth 2015
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Cleveland Clinic: Transformation and Growth 2015 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Clinic Cleveland, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Clinic Cleveland operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Cleveland Clinic: Transformation and Growth 2015 can be done for the following purposes –
1. Strategic planning using facts provided in Cleveland Clinic: Transformation and Growth 2015 case study
2. Improving business portfolio management of Clinic Cleveland
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Clinic Cleveland
Strengths Cleveland Clinic: Transformation and Growth 2015 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Clinic Cleveland in Cleveland Clinic: Transformation and Growth 2015 Harvard Business Review case study are -
Strong track record of project management
– Clinic Cleveland is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
High switching costs
– The high switching costs that Clinic Cleveland has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Ability to recruit top talent
– Clinic Cleveland is one of the leading recruiters in the industry. Managers in the Cleveland Clinic: Transformation and Growth 2015 are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Strategy & Execution industry
– Cleveland Clinic: Transformation and Growth 2015 firm has clearly differentiated products in the market place. This has enabled Clinic Cleveland to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Clinic Cleveland to invest into research and development (R&D) and innovation.
Ability to lead change in Strategy & Execution field
– Clinic Cleveland is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Clinic Cleveland in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Clinic Cleveland has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Clinic Cleveland has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Analytics focus
– Clinic Cleveland is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Michael E. Porter, Elizabeth Olmsted Teisberg can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Organizational Resilience of Clinic Cleveland
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Clinic Cleveland does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Clinic Cleveland is present in almost all the verticals within the industry. This has provided firm in Cleveland Clinic: Transformation and Growth 2015 case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Learning organization
- Clinic Cleveland is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Clinic Cleveland is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Cleveland Clinic: Transformation and Growth 2015 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Effective Research and Development (R&D)
– Clinic Cleveland has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Cleveland Clinic: Transformation and Growth 2015 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Clinic Cleveland digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Clinic Cleveland has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Weaknesses Cleveland Clinic: Transformation and Growth 2015 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cleveland Clinic: Transformation and Growth 2015 are -
Skills based hiring
– The stress on hiring functional specialists at Clinic Cleveland has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Increasing silos among functional specialists
– The organizational structure of Clinic Cleveland is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Clinic Cleveland needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Clinic Cleveland to focus more on services rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Clinic Cleveland needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Cleveland Clinic: Transformation and Growth 2015 HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Clinic Cleveland has relatively successful track record of launching new products.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Clinic Cleveland is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Cleveland Clinic: Transformation and Growth 2015 can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Capital Spending Reduction
– Even during the low interest decade, Clinic Cleveland has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Need for greater diversity
– Clinic Cleveland has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Interest costs
– Compare to the competition, Clinic Cleveland has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Lack of clear differentiation of Clinic Cleveland products
– To increase the profitability and margins on the products, Clinic Cleveland needs to provide more differentiated products than what it is currently offering in the marketplace.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Cleveland Clinic: Transformation and Growth 2015, in the dynamic environment Clinic Cleveland has struggled to respond to the nimble upstart competition. Clinic Cleveland has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Aligning sales with marketing
– It come across in the case study Cleveland Clinic: Transformation and Growth 2015 that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Cleveland Clinic: Transformation and Growth 2015 can leverage the sales team experience to cultivate customer relationships as Clinic Cleveland is planning to shift buying processes online.
Opportunities Cleveland Clinic: Transformation and Growth 2015 | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Cleveland Clinic: Transformation and Growth 2015 are -
Buying journey improvements
– Clinic Cleveland can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Cleveland Clinic: Transformation and Growth 2015 suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Clinic Cleveland in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Clinic Cleveland can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Clinic Cleveland in the consumer business. Now Clinic Cleveland can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Clinic Cleveland can develop new processes and procedures in Strategy & Execution industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Building a culture of innovation
– managers at Clinic Cleveland can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Strategy & Execution segment.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Clinic Cleveland to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Clinic Cleveland can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Clinic Cleveland can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Clinic Cleveland can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Cleveland Clinic: Transformation and Growth 2015, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Clinic Cleveland can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Using analytics as competitive advantage
– Clinic Cleveland has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Cleveland Clinic: Transformation and Growth 2015 - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Clinic Cleveland to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Clinic Cleveland has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Threats Cleveland Clinic: Transformation and Growth 2015 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Cleveland Clinic: Transformation and Growth 2015 are -
Shortening product life cycle
– it is one of the major threat that Clinic Cleveland is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Clinic Cleveland can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Cleveland Clinic: Transformation and Growth 2015 .
Technology acceleration in Forth Industrial Revolution
– Clinic Cleveland has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Clinic Cleveland needs to keep up with the evolution of technology in the Strategy & Execution sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Clinic Cleveland with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Environmental challenges
– Clinic Cleveland needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Clinic Cleveland can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Clinic Cleveland.
High dependence on third party suppliers
– Clinic Cleveland high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Regulatory challenges
– Clinic Cleveland needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Strategy & Execution industry regulations.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Clinic Cleveland in the Strategy & Execution sector and impact the bottomline of the organization.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Clinic Cleveland business can come under increasing regulations regarding data privacy, data security, etc.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Clinic Cleveland can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Clinic Cleveland in the Strategy & Execution industry. The Strategy & Execution industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Weighted SWOT Analysis of Cleveland Clinic: Transformation and Growth 2015 Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Cleveland Clinic: Transformation and Growth 2015 needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Cleveland Clinic: Transformation and Growth 2015 is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Cleveland Clinic: Transformation and Growth 2015 is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Cleveland Clinic: Transformation and Growth 2015 is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Clinic Cleveland needs to make to build a sustainable competitive advantage.
