Case Study Description of Texas Children's Hospital: Congenital Heart Disease Care
In 2014, Dr. Charles D. Fraser Jr., Surgeon-in-Chief of Texas Children's Hospital in Houston, was contemplating the future direction of the congenital heart disease program. The nation's largest pediatric hospital, Texas Children's was ranked by U.S. News & World Report as #4 in the nation in 2012-2013. It was ranked #3 in pediatric heart care and heart surgery, following Boston Children's and Children's Hospital of Philadelphia (CHOP). Texas Children's had some of the highest volumes in the nation, seeing more than 20,000 congenital heart disease patients and performing over 800 cardiac surgeries annually. Fraser led the reorganization of Texas Children's care for congenital heart disease conditions beginning in 1995, and had initiated universal outcome measurement. In 2014, the challenge was to continue to improve care in a complicated patient population, and take outcome measurement to a new level. Also, Texas Children's had recently formed partnerships with pediatric hospitals in Temple, San Antonio and Mexico City, and how to structure these partnerships was under active discussion.
Authors :: Michael E. Porter, Justin M. Bachmann, Zachary C. Landman
Swot Analysis of "Texas Children's Hospital: Congenital Heart Disease Care" written by Michael E. Porter, Justin M. Bachmann, Zachary C. Landman includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Children's Congenital facing as an external strategic factors. Some of the topics covered in Texas Children's Hospital: Congenital Heart Disease Care case study are - Strategic Management Strategies, Operations management, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Texas Children's Hospital: Congenital Heart Disease Care casestudy better are - – increasing household debt because of falling income levels, talent flight as more people leaving formal jobs, challanges to central banks by blockchain based private currencies, there is increasing trade war between United States & China, geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, increasing transportation and logistics costs,
supply chains are disrupted by pandemic , banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of Texas Children's Hospital: Congenital Heart Disease Care
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Texas Children's Hospital: Congenital Heart Disease Care case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Children's Congenital, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Children's Congenital 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 Texas Children's Hospital: Congenital Heart Disease Care can be done for the following purposes –
1. Strategic planning using facts provided in Texas Children's Hospital: Congenital Heart Disease Care case study
2. Improving business portfolio management of Children's Congenital
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 Children's Congenital
Strengths Texas Children's Hospital: Congenital Heart Disease Care | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Children's Congenital in Texas Children's Hospital: Congenital Heart Disease Care Harvard Business Review case study are -
High switching costs
– The high switching costs that Children's Congenital 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.
Effective Research and Development (R&D)
– Children's Congenital 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 Texas Children's Hospital: Congenital Heart Disease Care - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Children's Congenital is one of the most innovative firm in sector. Manager in Texas Children's Hospital: Congenital Heart Disease Care Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Children's Congenital are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Ability to lead change in Strategy & Execution field
– Children's Congenital 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 Children's Congenital in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
High brand equity
– Children's Congenital has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Children's Congenital to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Children's Congenital in the sector have low bargaining power. Texas Children's Hospital: Congenital Heart Disease Care has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Children's Congenital to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Strategy & Execution industry
– Texas Children's Hospital: Congenital Heart Disease Care firm has clearly differentiated products in the market place. This has enabled Children's Congenital to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Children's Congenital to invest into research and development (R&D) and innovation.
Operational resilience
– The operational resilience strategy in the Texas Children's Hospital: Congenital Heart Disease Care Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Highly skilled collaborators
– Children's Congenital has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Texas Children's Hospital: Congenital Heart Disease Care HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Successful track record of launching new products
– Children's Congenital has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Children's Congenital 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Children's Congenital digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Children's Congenital 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 Texas Children's Hospital: Congenital Heart Disease Care | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Texas Children's Hospital: Congenital Heart Disease Care are -
Products dominated business model
– Even though Children's Congenital has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Texas Children's Hospital: Congenital Heart Disease Care should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Children's Congenital products
– To increase the profitability and margins on the products, Children's Congenital needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Children's Congenital has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Children's Congenital even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Workers concerns about automation
– As automation is fast increasing in the segment, Children's Congenital 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.
Interest costs
– Compare to the competition, Children's Congenital 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Texas Children's Hospital: Congenital Heart Disease Care, it seems that the employees of Children's Congenital don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Need for greater diversity
– Children's Congenital 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.
Skills based hiring
– The stress on hiring functional specialists at Children's Congenital 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.
Slow to strategic competitive environment developments
– As Texas Children's Hospital: Congenital Heart Disease Care HBR case study mentions - Children's Congenital takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Increasing silos among functional specialists
– The organizational structure of Children's Congenital is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Children's Congenital needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Children's Congenital to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Texas Children's Hospital: Congenital Heart Disease Care 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 Children's Congenital has relatively successful track record of launching new products.
Opportunities Texas Children's Hospital: Congenital Heart Disease Care | 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 Texas Children's Hospital: Congenital Heart Disease Care are -
Buying journey improvements
– Children's Congenital can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Texas Children's Hospital: Congenital Heart Disease Care 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Children's Congenital can use these opportunities to build new business models that can help the communities that Children's Congenital operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Children's Congenital to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Children's Congenital to hire the very best people irrespective of their geographical location.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Children's Congenital can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Children's Congenital can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Creating value in data economy
– The success of analytics program of Children's Congenital has opened avenues for new revenue streams for the organization in the industry. This can help Children's Congenital to build a more holistic ecosystem as suggested in the Texas Children's Hospital: Congenital Heart Disease Care case study. Children's Congenital can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
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 Children's Congenital 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Children's Congenital can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Developing new processes and practices
– Children's Congenital 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.
Leveraging digital technologies
– Children's Congenital 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.
Loyalty marketing
– Children's Congenital 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Children's Congenital can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Children's Congenital is facing challenges because of the dominance of functional experts in the organization. Texas Children's Hospital: Congenital Heart Disease Care case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
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 Children's Congenital in the consumer business. Now Children's Congenital can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Texas Children's Hospital: Congenital Heart Disease Care External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Texas Children's Hospital: Congenital Heart Disease Care are -
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Children's Congenital needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Regulatory challenges
– Children's Congenital 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.
Shortening product life cycle
– it is one of the major threat that Children's Congenital is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology acceleration in Forth Industrial Revolution
– Children's Congenital has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Children's Congenital 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.
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.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
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 Children's Congenital.
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. Children's Congenital can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Children's Congenital
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Children's Congenital.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Children's Congenital will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Texas Children's Hospital: Congenital Heart Disease Care, Children's Congenital may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Consumer confidence and its impact on Children's Congenital demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Environmental challenges
– Children's Congenital 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. Children's Congenital can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Weighted SWOT Analysis of Texas Children's Hospital: Congenital Heart Disease Care 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 Texas Children's Hospital: Congenital Heart Disease Care 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 Texas Children's Hospital: Congenital Heart Disease Care 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 Texas Children's Hospital: Congenital Heart Disease Care 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 Texas Children's Hospital: Congenital Heart Disease Care 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 Children's Congenital needs to make to build a sustainable competitive advantage.
