Operations Management 1. How successful is Shouldice Hospital? 2. How do you acc
ID: 433835 • Letter: O
Question
Operations Management 1. How successful is Shouldice Hospital? 2. How do you account for its performance? 3. As Dr. Shouldice, what actions, if any, would you take to expand the hospital's capacity? 4. What changes would you recommend and how would you implement them? Analysis Tip: There is a bottleneck at Shouldice Hospital. Creating a service map of the operation will allow you to identify each of the resources required to deliver the service. Checking the capacity of each of these resources will help you identify the bottleneck Cancel Update Expert Answer o pdf 683068p2 (1)pdf . 693065p2.pdf Shouldice Hospital pdf e here to searchExplanation / Answer
Hospital
Revenues (In $)
(4x$111x 6850 patients per year)
3,041,400
Cost
2,800.000
Profit
241,400
Clinic revenues ($450+60+75x.20)x6850
3,596,250
cost
2,000,000
Profit
1,596,250
Total Profit
$1,837,650
Hospital
Revenues (In $)
(4x$111x 6850 patients per year)
3,041,400
Cost
2,800.000
Profit
241,400
Clinic revenues ($450+60+75x.20)x6850
3,596,250
cost
2,000,000
Profit
1,596,250
Total Profit
$1,837,650
To sum it up they have cost-effective methods of working; ensure employee satisfaction who in turn ensure patient satisfaction creating a win-win situation for Shouldice Hospital.
Option 1:
Build an extra facility on the same premises will increase the capacity of the hospital with about 45 beds. The additional team can be trained and hired and they will soon be part of the existing set up. The quality and standards will be easy to manage and maintain.
Disadvantages are the team will have to put in extra time initially. The workload on existing surgeons will increase substantially. The cost of creating a new facility and the investment will be very high.
Option 2: Staff will start operating the facility on week ends, extra staff can be rained and taken on to manage the increased requirement. New surgeons can be added on to the existing facility,
The disadvantage is that the staff might not like to work on the weekends and there might a bit of dissatisfaction level.
Option 3 is ruled out because it would need an entirely new set up with a lot of investment. Option 4 is not required as the hospital is renowned only for hernia procedures which also they are unable to satisfy.
To sum it up this is the easiest and most cost-effective method as new staff can be introduced and the quality standards can be maintained while enhancing the capacity of the hospital. The employees are already on a profit share policy and would be happy to get the better share of profits.
The Shouldice hospital should handle the following key issues:
Hospital
Revenues (In $)
(4x$111x 6850 patients per year)
3,041,400
Cost
2,800.000
Profit
241,400
Clinic revenues ($450+60+75x.20)x6850
3,596,250
cost
2,000,000
Profit
1,596,250
Total Profit
$1,837,650
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