Strategic Management of Cleveland Clinic

Developing a strong organizational culture, brand and reputation require strategic planning and an overall understanding of the existing dynamics in the industry. Considerably, most health facilities concentrate on methods that can help in improving the quality of services they offer including purchasing modern equipment and recruiting skilled personnel. However, the successful development and competitiveness of any health facility less on the management approach employed and the ability of the institution to initiate creative customer care initiatives. Cleveland Clinic, for instance, has over the years ensured it adheres to its ‘patient first’ slogan to ensure ailing individuals are given the first priority in all aspects. As such, this study will provide an overview of the Cleveland clinic through assessing both internal and external environments as well as providing formulation and implementation techniques applicable to the institution’s development.

Eternal Analysis

These include factors that have a significant effect on an organization but the firm has little or no control over them

PESTEL Analysis

Political. Cleveland clinic faces significant effects by some of the laws developed over the years by the U.S. government. Although these policies are developed to ensure patient safety and improve quality services are rendered, they sometimes disrupt the effective operation of the institution. Moreover, the clinic also faces threats of political stability in its globalization campaign.

Economical. Locally, the clinic may be affected by exchange rate fluctuation due to the changing value of the U.S. currency. Additionally, the fluctuation in the rate of unemployment in the country also increases the overall expenses of the entity on aspects such as wages and repair of equipment. Cleveland also faces increased competition from hospitals like

Social. The increase in population in the area has prompted the organization to employ more staff to cope with the growing demand for its services (Porter & Teisberg, 2016). Equally, change in general health standards has also demanded the facility to change its operations structure.

Technological. Cleveland clinic has highly invested in the use of modern technology in providing quality care to its patients. For instance, Dr. Martin Harris implements strategies that would support learning, outcome measurement and improve multidisciplinary teams. The institution also introduced ‘Mychart’ a customer portal that enables easy interaction between physicians and their clients.

Environmental. The facility engages in both community development and ecological protection initiatives and has also the structured Office of a Healthy Environment to help in increasing awareness of environmental protection (Cleveland clinic, 2018).

Legal. Cleveland Clinic has to comply with both local and international laws developed by the various governments and recognized agencies. For instance, it expands its operations to countries such as Canada and the United Arab Emirates, the hospital has to adhere to all the regulations of the respective counties.

Industry Environment

5 Forces Analysis

The threat of new entrants. The health care industry in the United States has over the years seen an increase in the number of health institutions offering different types of services. However, various factors still limit the threat of new entrants including government policies, high capital requirements, access to suppliers, and switching costs.

Threats of substitutes. Many health facilities offer the same products and services like those provided by Cleveland Clinic. For instance, the Weston hospital also provides varying services including cardiac, cancer and transplants thus providing customers with alternatives.

Rivalry. Cleveland experiences a high level of competition from other high performing health institutions both in and out of the region including Weston, Lakewood, Lutheran, Fairview and Euclid hospitals.

Bargaining power of buyers. Customers in Cleveland clinic have a high bargaining power and the hospital develops all its products to cater for their needs. Moreover, the facility has differentiated its departments and diversified its services to accommodate their increasing needs.

Bargaining power of suppliers. There exist many suppliers in the U.S. health industry that limits their bargaining power and hospitals have the ability to dictate the prices of some of the products they purchase.

SCP Strategy

Structure. The firm has a central organisational structure that develops overall plans to be used. Moreover, it operates in a competitive industry with increasing number of rival health facilities. Both cost and demand for the organizations services increase every year.

Conduct. Cleveland clinic is competition focused and uses innovation and strategic planning as its primary growth tool. It uses research and development as well as technological investment to identify alternative means of increasing their effectiveness.

Performance. The entity focuses on reducing overall operational costs and creating more value to its patients.it further ensures that each stakeholder is certified with the operations and services they receive.

Internal Analysis

VRIO Analysis

Resources / capabilities

Valuable

Rare

Imitable

Organizationally exploitable

Implication

Human resources

Yes

Yes

No

No

Partially advantageous

Customer base

Yes

Yes

No

No

Competitive advantage

New technology

Yes

Yes

Yes

Yes

Temporary advantage

Management

Yes

Yes

No

No

Competitive advantage

Brand name

Yes

No

No

No

Competitive advantage

Simplicity of operation

Yes

Yes

Yes

Yes

Temporary advantage

Location

Yes

Yes

No

Yes

Competitive advantage

Table 1

Cleveland clinic has different resources that help in maintaining its competitive advantage in the industry including management, brand name, the simplicity of its operations, location, customer base, human resources, and new technology. Essentially, the location of the main office enables to serve many patients in the region due to its easy accessibility. Moreover, assets such as management and brand name cannot be imitated thus increasing the uniqueness of the hospital in the market.

SWOT Analysis

Strengths. Cleveland enjoys different abilities including its innovative culture, strong management team, brand name, modern technology and asset leverage that gives it an upper hand in the market.

Weakness. The facility has little experience in international markets and may affect its long-term development. Additionally, the opening of many institutes subjected the facilities to financial loses that could lead to financial instability.

Opportunities. The increase in population enables the firm to grow immensely and also explore international markets. Other aspects including changing of styles and patterns also present increased operation ventures for the institution.

Threats. Cleveland clinic faces different levels of threats including increased rate of competition, changing technology, government regulation, and cash flow complications.

Formulation

The formulation in a healthcare involves selecting the most appropriate approach that can help in achieving the set objectives. Cleveland Clinic has developed an effective framework that has divided the strategy into different sections including the restructuring of health delivery, performance measurement, patient wellness and experience, health system rationalization, and investment in information technology (Porter & Teisberg, 2016). However, the organization would have to also consider other factors including establishing goals, analyzing both the internal and external environments, performance analysis and methods of implementing the selected strategies.

Implementation

Implementation involves execution of the developed plan or framework to aid in accomplishing specific objectives. For the management of the Cleveland clinic to ensure that all the goals are achieved, they must ensure that they have all the relevant information about the current trends in the market. Additionally, they will need to assess all the resources available and all the prevailing risks.

Summary

Cleveland clinic has over the years successfully implemented strategies that not only increase their competitiveness in the market but also ensures that both staffs and patients are contented with the management methods applied. To increase its competitiveness in the industry, the company should limit some of its weaknesses and threats including developing a proper globalization plan and developing proper performance appraisal approaches.

Reference

Cleveland clinic. (2018). About the Office for a Healthy Environment. Retrieved from https://my.clevelandclinic.org/about/community/healthy-environment/about

Porter, M., & Teisberg, E. (2016). Cleveland clinic: Transformation and growth 2015