Case Study Description of Intermountain Healthcare: Pursuing Precision Medicine
Headquartered in Salt Lake City, Intermountain Healthcare operates 23 hospitals and hundreds of clinics in Utah and Idaho and provides insurance to approximately 850,000 patients through its insurance arm, SelectHealth. In 2013, Intermountain, known for its commitment to improving health care outcomes and lowering costs by reducing treatment variation, made the surprising decision to invest significant resources in an innovative precision medicine unit, which would provide life-extending, genetically-targeted therapies to late-stage cancer patients. Precision medicine was associated with treatment variation and high costs, the latter of which was of particular concern given that Intermountain often served as both payer and provider for its patients. But Intermountain's management was convinced by Lincoln Nadauld, MD, PhD, who joined Intermountain's oncology team in 2013 and spearheaded the creation of Intermountain Precision Genomics (IPG). By 2016, IPG had a cutting-edge genomic sequencing laboratory that provided sequencing services to Intermountain and non-Intermountain physicians, and IPG's team had conducted research indicating that targeted therapies administered through IPG extended patient lifespans but increased overall costs. Now, in mid-2017, IPG is undergoing a major transition as it prepares to outsource the bulk of its genomic testing volume to Navican Genomics, a for-profit, Intermountain-owned spinoff. As Nadauld contemplates the future of IPG, he must evaluate two exciting opportunities, and students are asked to consider where Nadauld should focus IPG's resources: should IPG partner with Intermountain's behavioral health team to conduct joint research on the relationship between genetic markers and antidepressant effectiveness, or should IPG push for the testing of a large biorepository, which will cost $12 million but could lead to the identification of new precision medicine applications? More broadly, students will also need consider the ways in which IPG complements or conflicts with Intermountain's mission and culture.
Authors :: Richard G. Hamermesh, Kathy Giusti, Robert S. Huckman, Julia Kelley
Swot Analysis of "Intermountain Healthcare: Pursuing Precision Medicine" written by Richard G. Hamermesh, Kathy Giusti, Robert S. Huckman, Julia Kelley includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Ipg Intermountain facing as an external strategic factors. Some of the topics covered in Intermountain Healthcare: Pursuing Precision Medicine case study are - Strategic Management Strategies, Leadership, Social enterprise, Supply chain, Technology and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Intermountain Healthcare: Pursuing Precision Medicine casestudy better are - – challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, increasing inequality as vast percentage of new income is going to the top 1%, wage bills are increasing, supply chains are disrupted by pandemic ,
there is increasing trade war between United States & China, increasing energy prices, etc
Introduction to SWOT Analysis of Intermountain Healthcare: Pursuing Precision Medicine
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Intermountain Healthcare: Pursuing Precision Medicine case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Ipg Intermountain, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Ipg Intermountain 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 Intermountain Healthcare: Pursuing Precision Medicine can be done for the following purposes –
1. Strategic planning using facts provided in Intermountain Healthcare: Pursuing Precision Medicine case study
2. Improving business portfolio management of Ipg Intermountain
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Ipg Intermountain
Strengths Intermountain Healthcare: Pursuing Precision Medicine | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Ipg Intermountain in Intermountain Healthcare: Pursuing Precision Medicine Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Intermountain Healthcare: Pursuing Precision Medicine 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
– Ipg Intermountain 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 Intermountain Healthcare: Pursuing Precision Medicine HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Intermountain Healthcare: Pursuing Precision Medicine firm has clearly differentiated products in the market place. This has enabled Ipg Intermountain to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Ipg Intermountain to invest into research and development (R&D) and innovation.
Analytics focus
– Ipg Intermountain 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 G. Hamermesh, Kathy Giusti, Robert S. Huckman, Julia Kelley 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.
Innovation driven organization
– Ipg Intermountain is one of the most innovative firm in sector. Manager in Intermountain Healthcare: Pursuing Precision Medicine Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to recruit top talent
– Ipg Intermountain is one of the leading recruiters in the industry. Managers in the Intermountain Healthcare: Pursuing Precision Medicine are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Innovation & Entrepreneurship field
– Ipg Intermountain 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 Ipg Intermountain in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Ipg Intermountain 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.
Learning organization
- Ipg Intermountain 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 Ipg Intermountain is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Intermountain Healthcare: Pursuing Precision Medicine Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Ipg Intermountain digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Ipg Intermountain 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.
Low bargaining power of suppliers
– Suppliers of Ipg Intermountain in the sector have low bargaining power. Intermountain Healthcare: Pursuing Precision Medicine has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Ipg Intermountain to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Ipg Intermountain has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Intermountain Healthcare: Pursuing Precision Medicine 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.
Weaknesses Intermountain Healthcare: Pursuing Precision Medicine | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Intermountain Healthcare: Pursuing Precision Medicine are -
Slow decision making process
– As mentioned earlier in the report, Ipg Intermountain 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. Ipg Intermountain 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.
No frontier risks strategy
– After analyzing the HBR case study Intermountain Healthcare: Pursuing Precision Medicine, it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship 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.
Interest costs
– Compare to the competition, Ipg Intermountain 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 Ipg Intermountain products
– To increase the profitability and margins on the products, Ipg Intermountain 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 Intermountain Healthcare: Pursuing Precision Medicine, in the dynamic environment Ipg Intermountain has struggled to respond to the nimble upstart competition. Ipg Intermountain has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Ipg Intermountain 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.
Slow to strategic competitive environment developments
– As Intermountain Healthcare: Pursuing Precision Medicine HBR case study mentions - Ipg Intermountain 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.
Need for greater diversity
– Ipg Intermountain 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Ipg Intermountain is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Intermountain Healthcare: Pursuing Precision Medicine can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Skills based hiring
– The stress on hiring functional specialists at Ipg Intermountain 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 Ipg Intermountain is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Ipg Intermountain needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Ipg Intermountain to focus more on services rather than just following the product oriented approach.
Opportunities Intermountain Healthcare: Pursuing Precision Medicine | 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 Intermountain Healthcare: Pursuing Precision Medicine are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Ipg Intermountain can use these opportunities to build new business models that can help the communities that Ipg Intermountain operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Ipg Intermountain 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, Intermountain Healthcare: Pursuing Precision Medicine, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Building a culture of innovation
– managers at Ipg Intermountain 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 Innovation & Entrepreneurship segment.
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 Ipg Intermountain in the consumer business. Now Ipg Intermountain can target international markets with far fewer capital restrictions requirements than the existing system.
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. Ipg Intermountain can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Ipg Intermountain can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Ipg Intermountain 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. Ipg Intermountain 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Ipg Intermountain 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
– Ipg Intermountain 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.
Learning at scale
– Online learning technologies has now opened space for Ipg Intermountain to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Manufacturing automation
– Ipg Intermountain can use the latest technology developments to improve its manufacturing and designing process in Innovation & Entrepreneurship 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Ipg Intermountain 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 Ipg Intermountain to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Ipg Intermountain 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 Intermountain Healthcare: Pursuing Precision Medicine - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Ipg Intermountain to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Intermountain Healthcare: Pursuing Precision Medicine External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Intermountain Healthcare: Pursuing Precision Medicine are -
Consumer confidence and its impact on Ipg Intermountain 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Ipg Intermountain 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 Intermountain Healthcare: Pursuing Precision Medicine .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Ipg Intermountain in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship 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.
Increasing wage structure of Ipg Intermountain
– 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 Ipg Intermountain.
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 Ipg Intermountain in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Ipg Intermountain is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Ipg Intermountain 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
– Ipg Intermountain 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. Ipg Intermountain can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
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 Ipg Intermountain.
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.
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 Ipg Intermountain business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Ipg Intermountain has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Ipg Intermountain needs to keep up with the evolution of technology in the Innovation & Entrepreneurship 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.
Weighted SWOT Analysis of Intermountain Healthcare: Pursuing Precision Medicine 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 Intermountain Healthcare: Pursuing Precision Medicine 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 Intermountain Healthcare: Pursuing Precision Medicine 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 Intermountain Healthcare: Pursuing Precision Medicine 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 Intermountain Healthcare: Pursuing Precision Medicine 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 Ipg Intermountain needs to make to build a sustainable competitive advantage.
