Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

Case Study SWOT Analysis Solution

Case Study Description of Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization

"Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization" examines how a complex medical organization evaluates new health information technology products to pilot, purchase, and utilize. Every year, hundreds of companies pitched their health IT solutions to Stanford Medicine and its associated entities: the Stanford University School of Medicine, Lucile Packard Children's Hospital Stanford, and Stanford Health Care. However, Stanford Medicine would only select a few of these IT products to purchase and implement. Highlighting a few specific health information technology companies and products, this case explores the organizational decision-making process at Stanford Medicine and the criteria used to evaluate new technologies.

Authors :: Robert Chess, Ryan Kissick

Topics :: Technology & Operations

Tags :: IT, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis

Swot Analysis of "Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization" written by Robert Chess, Ryan Kissick includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Stanford Medicine facing as an external strategic factors. Some of the topics covered in Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization case study are - Strategic Management Strategies, IT and Technology & Operations.

Some of the macro environment factors that can be used to understand the Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization casestudy better are - – increasing household debt because of falling income levels, geopolitical disruptions, increasing transportation and logistics costs, increasing inequality as vast percentage of new income is going to the top 1%, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies, digital marketing is dominated by two big players Facebook and Google, etc

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Introduction to SWOT Analysis of Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Stanford Medicine, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Stanford Medicine 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization can be done for the following purposes –
1. Strategic planning using facts provided in Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization case study
2. Improving business portfolio management of Stanford Medicine
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 Stanford Medicine

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Strengths Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Stanford Medicine in Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization Harvard Business Review case study are -

Superior customer experience

– The customer experience strategy of Stanford Medicine in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

Low bargaining power of suppliers

– Suppliers of Stanford Medicine in the sector have low bargaining power. Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Stanford Medicine to manage not only supply disruptions but also source products at highly competitive prices.

Cross disciplinary teams

– Horizontal connected teams at the Stanford Medicine 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.

Effective Research and Development (R&D)

– Stanford Medicine 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 Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.

Operational resilience

– The operational resilience strategy in the Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization 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.

Diverse revenue streams

– Stanford Medicine is present in almost all the verticals within the industry. This has provided firm in Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization 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

- Stanford Medicine 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 Stanford Medicine is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization Harvard Business Review case study emphasize – knowledge, initiative, and innovation.

Ability to lead change in Technology & Operations field

– Stanford Medicine 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 Stanford Medicine in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.

High switching costs

– The high switching costs that Stanford Medicine 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.

Innovation driven organization

– Stanford Medicine is one of the most innovative firm in sector. Manager in Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.

High brand equity

– Stanford Medicine has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Stanford Medicine to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Analytics focus

– Stanford Medicine 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 Robert Chess, Ryan Kissick 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.

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Weaknesses Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization are -

Ability to respond to the competition

– As the decision making is very deliberative, highlighted in the case study Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization, in the dynamic environment Stanford Medicine has struggled to respond to the nimble upstart competition. Stanford Medicine 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, Stanford Medicine 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 cash cycle compare to competitors

Stanford Medicine has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.

High bargaining power of channel partners

– Because of the regulatory requirements, Robert Chess, Ryan Kissick suggests that, Stanford Medicine is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.

Interest costs

– Compare to the competition, Stanford Medicine 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, Stanford Medicine is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.

Lack of clear differentiation of Stanford Medicine products

– To increase the profitability and margins on the products, Stanford Medicine needs to provide more differentiated products than what it is currently offering in the marketplace.

Employees’ incomplete understanding of strategy

– From the instances in the HBR case study Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization, it seems that the employees of Stanford Medicine 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.

Capital Spending Reduction

– Even during the low interest decade, Stanford Medicine 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.

Increasing silos among functional specialists

– The organizational structure of Stanford Medicine is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Stanford Medicine needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Stanford Medicine to focus more on services rather than just following the product oriented approach.

Slow decision making process

– As mentioned earlier in the report, Stanford Medicine 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. Stanford Medicine 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.

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Opportunities Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization | 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 Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization are -

Learning at scale

– Online learning technologies has now opened space for Stanford Medicine 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.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Stanford Medicine 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, Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Using analytics as competitive advantage

– Stanford Medicine 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 Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Stanford Medicine to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.

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. Stanford Medicine can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Better consumer reach

– The expansion of the 5G network will help Stanford Medicine to increase its market reach. Stanford Medicine 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.

Creating value in data economy

– The success of analytics program of Stanford Medicine has opened avenues for new revenue streams for the organization in the industry. This can help Stanford Medicine to build a more holistic ecosystem as suggested in the Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization case study. Stanford Medicine can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Stanford Medicine 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 Stanford Medicine to hire the very best people irrespective of their geographical location.

Changes in consumer behavior post Covid-19

– Consumer behavior has changed in the Technology & Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Stanford Medicine 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. Stanford Medicine 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.

Leveraging digital technologies

– Stanford Medicine 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Stanford Medicine in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Stanford Medicine can use these opportunities to build new business models that can help the communities that Stanford Medicine operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.

Building a culture of innovation

– managers at Stanford Medicine 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.

Manufacturing automation

– Stanford Medicine 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.

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Threats Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats mentioned in the HBR case study Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization are -

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Stanford Medicine in the Technology & Operations industry. The Technology & Operations 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 Stanford Medicine

– 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 Stanford Medicine.

Stagnating economy with rate increase

– Stanford Medicine can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.

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. Stanford Medicine can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

Consumer confidence and its impact on Stanford Medicine 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.

Regulatory challenges

– Stanford Medicine 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.

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 Stanford Medicine in the Technology & Operations sector and impact the bottomline of the organization.

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. Stanford Medicine needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.

High dependence on third party suppliers

– Stanford Medicine 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.

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 Stanford Medicine.

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.

Increasing international competition and downward pressure on margins

– Apart from technology driven competitive advantage dilution, Stanford Medicine 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 Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization .

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. Stanford Medicine 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.

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Weighted SWOT Analysis of Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization 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 Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization 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 Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization 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 Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization 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 Stanford Medicine: Health IT Purchasing Decisions in a Complex Medical Organization 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 Stanford Medicine needs to make to build a sustainable competitive advantage.

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