Shouldice Hospital Essay examples

Decent Essays
1. How successful is the Shouldice Hospital? Generate a P&L statement using available information from the case. Treat each of the two operations—hospital and the surgery—separately.

Revenues (4 days X $111/day x 6,850 patients/year) 3,041,400
Cost 2,800,000
Profit: 241,400

Revenues ((($450 + 60 + 75) X 0.20) X 6,850 patients/year)) 3,596,250
Cost 2,000,000
Profit 1,596,250

Total Profit 1,837,650

2. How do you account for its successful performance?

The following factors account for the success of Shouldice hospital:
• Unique and pioneering surgical technique for Hernia operation which reduced the suffering of the patients and led to rapid
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This also resulted in low nurse to patient ratio compared to other similar hospitals (0.44)
• Offering the cheapest option for treatment of hernia in the region
• High reliability of Hernia operation with very small recurrence rate of 0.8 % as compared to high recurrence rates of close to 10 % as in the United States.
• Doctors and nurses were motivated by way of higher salaries and profit sharing systems in the form of bonuses compared to other hospitals in the region and reasonable workload leading to sense of belongingness amongst the doctors and nurses leading to low attrition.
• Encouraged group cohesiveness and fraternity type of coordination mechanism within the organization leading to greater operational efficiency. The above factors resulted in remarkable credibility for the Shouldice Hospital that position edit in the market as a hospital which ensured cost effective, reliable, caring and responsive service to the hernia patients.

3. Prepare a patient process flow diagram from arrival through surgery and determine the capacities at each stage. For this diagram, only indicate major points in the process, e.g., admitting, examination, operating room surgeries, etc. Use the actual hours of operation for each step in the process to determine the capacity of each step. Where is the
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