Case Study Description of Istituto Clinico Humanitas (A)
Istituto Clinico Humanitas is a newly built private hospital, south of Milan, Italy, that has attained unusual profitability while treating public system patients. The hospital was built and is managed by Techosp, a subsidiary of Techint, a global engineering and consulting firm. Techosp created a design and management system that emphasizes optimizing patient throughput and utilization of all of the hospital's facilities. Physicians are all fully employed and have a significant financial incentive to maximize efficiency. The executive team is now considering whether to affiliate with the University of Milan medical school and, in effect, become Italy's first private academic medical center. The general manager must consider the effect of this affiliation on the hospital's performance.
Authors :: Richard Bohmer, Gary P. Pisano, Ning Tang
Swot Analysis of "Istituto Clinico Humanitas (A)" written by Richard Bohmer, Gary P. Pisano, Ning Tang includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Techosp Clinico facing as an external strategic factors. Some of the topics covered in Istituto Clinico Humanitas (A) case study are - Strategic Management Strategies, Strategic planning and Technology & Operations.
Some of the macro environment factors that can be used to understand the Istituto Clinico Humanitas (A) casestudy better are - – digital marketing is dominated by two big players Facebook and Google, there is backlash against globalization, increasing commodity prices, supply chains are disrupted by pandemic , wage bills are increasing, technology disruption, there is increasing trade war between United States & China,
central banks are concerned over increasing inflation, increasing energy prices, etc
Introduction to SWOT Analysis of Istituto Clinico Humanitas (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Istituto Clinico Humanitas (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Techosp Clinico, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Techosp Clinico 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 Istituto Clinico Humanitas (A) can be done for the following purposes –
1. Strategic planning using facts provided in Istituto Clinico Humanitas (A) case study
2. Improving business portfolio management of Techosp Clinico
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Techosp Clinico
Strengths Istituto Clinico Humanitas (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Techosp Clinico in Istituto Clinico Humanitas (A) Harvard Business Review case study are -
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Techosp Clinico digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Techosp Clinico 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.
Effective Research and Development (R&D)
– Techosp Clinico 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 Istituto Clinico Humanitas (A) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Training and development
– Techosp Clinico has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Istituto Clinico Humanitas (A) Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Ability to lead change in Technology & Operations field
– Techosp Clinico 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 Techosp Clinico 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
– Techosp Clinico has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Techosp Clinico 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.
Ability to recruit top talent
– Techosp Clinico is one of the leading recruiters in the industry. Managers in the Istituto Clinico Humanitas (A) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Low bargaining power of suppliers
– Suppliers of Techosp Clinico in the sector have low bargaining power. Istituto Clinico Humanitas (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Techosp Clinico to manage not only supply disruptions but also source products at highly competitive prices.
Sustainable margins compare to other players in Technology & Operations industry
– Istituto Clinico Humanitas (A) firm has clearly differentiated products in the market place. This has enabled Techosp Clinico to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Techosp Clinico to invest into research and development (R&D) and innovation.
Superior customer experience
– The customer experience strategy of Techosp Clinico in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Innovation driven organization
– Techosp Clinico is one of the most innovative firm in sector. Manager in Istituto Clinico Humanitas (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Techosp Clinico
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Techosp Clinico does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Analytics focus
– Techosp Clinico 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 Richard Bohmer, Gary P. Pisano, Ning Tang 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.
Weaknesses Istituto Clinico Humanitas (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Istituto Clinico Humanitas (A) are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Istituto Clinico Humanitas (A), in the dynamic environment Techosp Clinico has struggled to respond to the nimble upstart competition. Techosp Clinico has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Istituto Clinico Humanitas (A), is just above the industry average. Techosp Clinico needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Capital Spending Reduction
– Even during the low interest decade, Techosp Clinico 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.
No frontier risks strategy
– After analyzing the HBR case study Istituto Clinico Humanitas (A), it seems that company is thinking about the frontier risks that can impact Technology & Operations strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Istituto Clinico Humanitas (A) 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 Techosp Clinico has relatively successful track record of launching new products.
Need for greater diversity
– Techosp Clinico 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.
Products dominated business model
– Even though Techosp Clinico 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 - Istituto Clinico Humanitas (A) should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Techosp Clinico products
– To increase the profitability and margins on the products, Techosp Clinico needs to provide more differentiated products than what it is currently offering in the marketplace.
Increasing silos among functional specialists
– The organizational structure of Techosp Clinico is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Techosp Clinico needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Techosp Clinico to focus more on services rather than just following the product oriented approach.
Interest costs
– Compare to the competition, Techosp Clinico 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Techosp Clinico is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Istituto Clinico Humanitas (A) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Istituto Clinico Humanitas (A) | 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 Istituto Clinico Humanitas (A) are -
Manufacturing automation
– Techosp Clinico can use the latest technology developments to improve its manufacturing and designing process in Technology & Operations 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.
Leveraging digital technologies
– Techosp Clinico 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.
Building a culture of innovation
– managers at Techosp Clinico 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 Technology & Operations segment.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Techosp Clinico 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, Istituto Clinico Humanitas (A), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Techosp Clinico 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 Techosp Clinico to hire the very best people irrespective of their geographical location.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Technology & Operations industry, but it has also influenced the consumer preferences. Techosp Clinico can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Techosp Clinico has opened avenues for new revenue streams for the organization in the industry. This can help Techosp Clinico to build a more holistic ecosystem as suggested in the Istituto Clinico Humanitas (A) case study. Techosp Clinico can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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 Techosp Clinico in the consumer business. Now Techosp Clinico can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Techosp Clinico to increase its market reach. Techosp Clinico will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
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 Techosp Clinico 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Techosp Clinico is facing challenges because of the dominance of functional experts in the organization. Istituto Clinico Humanitas (A) 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Techosp Clinico can use these opportunities to build new business models that can help the communities that Techosp Clinico operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Techosp Clinico can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Threats Istituto Clinico Humanitas (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Istituto Clinico Humanitas (A) are -
Regulatory challenges
– Techosp Clinico 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 Technology & Operations industry regulations.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Techosp Clinico 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 Istituto Clinico Humanitas (A) .
High dependence on third party suppliers
– Techosp Clinico 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.
Environmental challenges
– Techosp Clinico 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. Techosp Clinico can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Techosp Clinico can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Techosp Clinico is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Techosp Clinico.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Techosp Clinico with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Techosp Clinico 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.
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 Techosp Clinico business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Istituto Clinico Humanitas (A), Techosp Clinico may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
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. Techosp Clinico needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Increasing wage structure of Techosp Clinico
– 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 Techosp Clinico.
Weighted SWOT Analysis of Istituto Clinico Humanitas (A) 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 Istituto Clinico Humanitas (A) 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 Istituto Clinico Humanitas (A) 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 Istituto Clinico Humanitas (A) 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 Istituto Clinico Humanitas (A) 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 Techosp Clinico needs to make to build a sustainable competitive advantage.