The Shouldice Hospital Limited
Q1) How successful was the Shouldice hospital and how do you account for its performance?
Ans ) The success of a hospital which basically is a part of the service industry can be done in 2 ways -
The financial perspective
The service perspective
Financial analysis :
Total market
Nos of operations in US = 600000 ( in 1979 assuming it is the same in 1983)
Nos of operations in Shouldice = 6850 (in 1982)
Market share = 1.14%(assuming that the market size remains the same)
Price charged per customer on average (assuming similar price for primaries and recurrence)
Accommodation = $ 111 * 4 (4 days)= $ 444
Surgery cost = $ 450
Assistant surgeon = $ 60(assuming every operation uses an assistant surgeon)
Anesthetic = $ 75(assume we are using an anesthetic in every operation )
Transport costs = $ 400(average of $ 200 to $ 600)
Total expenses for the customer = $ 1429
Total revenue of the hospital = $ 1029* 6850
= $ 70,48,650
Cost incurred by the hospital:
Salaries of the surgeon = $ 50000* 12
= $ 600,000
Bonus = $ 500,000
Assistant surgeon = $ 30.6*
Hospital visiting committee sets out to bring Pass...
Graphical explanation of the total revenue test to...
Total revenue uncertainty6850
= $ 209610
Anesthetist = $ 300 * 261(working days in an year)
= $ 78300
Food expenses = $ 1.1 * 400 * 261
= $ 114840
Total expenditure = $ 24,27,750
Gross operating margin = $ 46,20,900
(This is excluding the other expenses which are not given in the case and also it considers only the variable costs and not the fixed costs of the building and the operation theater )
As we can see , the gross operating margin is substantial and hence the hospital is very successful in terms of the money
Now the other parameter that...
Management plans
I think thos is exactly what this is and it is good. If every person grading this understands what this is then you might get a good score.
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