Shouldice Hospital Case Study

Shouldice Hospital Case Study

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Part 1: SWOT Analysis

        Strengths

1.                Shouldice Hospital has become successful by specializing. The hospital only performs certain types of hernia surgeries (to the exclusion of all other procedures), and performing them very well.

2.                The hospital, through its unique combination of post–operative procedures and the maintenance of a “country club” ambience, offers its patients a quick and relatively painless recovery from hernia surgery.

3.                The hospital has adopted a practice of keeping in touch with patients to enhance and maintaining the hospital’s reputation and to generate referral business.

        Weaknesses

1.                Shouldice Hospital is currently operating at near capacity, which is limiting its profitability.

2.                There is no real consensus as to how Shouldice should go about increasing its capacity.

        Opportunities

1.                Centric Health, a major Canadian healthcare provider attempted to purchase Shouldice in 2012 (Vancouver Sun 2012). The sale was controversial, and was ultimately terminated by the Health Minister, exercising powers provided by Canada’s Private Hospitals Act (Skyvington 2012).

        Threats

1.                The Ontario Provincial Insurance System currently reimburses100% of costs for procedures done at Shouldice. Canada’s healthcare system is facing the possibilities of various reforms, specifically moving to payment based on patient need, rather than the abstract notion of a “universal right” to healthcare (Bliss 2010:14; Dodge and Dion 2011:26).

2.                A significant percentage of Shouldice’s patients are American. The full implications of the implementation of “Obamacare,” are uncertain due to conflict between President Obama and the Republican Congress that was elected in late 2014. It is possible that the changes to healthcare in America could result in a reduction in the demand for Shouldice’s services.

Part 2: Plans for Expansion

        Shouldice Hospital has made a concerted decision to expand. There are two possible “expansions” under consideration. The first calls for an extension of the Shouldice work week (days on which operations are performed from five to six, adding Saturday). The second calls for the construction of a second level to the existing Shouldice facility.

        An examination of the hospital’s current operations reveals that its beds are only fully utilized for three out of the five operating days (cf., Brandeau and Sainfort 2004 pp. 427-431):