North Lake Medical Centre Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Introduction:

The North Lake Medical Centre is a community clinic and hospital situated 30 miles away from Milwaukee. The hospital consists of almost 480 beds. The hospital is subject to a rapid change in the culture, leadership and business environment. The revenues of the hospital havenearly doubled in the past ten years, however, in the last year, the hospital incurred operating losses amounting to approximately $2.3 million. North Lake Medical Centre is considered to be one of the leading hospitals in the district of Milwaukee and is comparableto some of the best hospitals in the region. The Medical Centre receives grants from the National Institute of Health due to its quality and innovation in the care of the patients. The hospital is also well regarded among various teaching hospitals.

The organization is headed by the experienced and enthusiastic medical personnel Dr. Kerri Hulen; the hospital is dividedinto three divisions which are Surgery, Medicine, and Pediatrics. All the departments are headed by specialistsof thoserespective departments. The director of each department is responsible for setting the targets for eachunit and the head of the department is also responsible for the achievement of those goals. In the past five years, the competition in the medical industry has increased drastically; on the other hand, the operating expenses havealso increased by a huge amount which is the primary reason for the loss in the current fiscal year.

As a result of this increasing competition and costs, many measureshave beentaken to tackle the situation but due to various restrictions placed on the government-backed departments, the management cannot do much. If the covenants of the government are breached, the North Lake Medical Centre can face many penalties from the government such as fines, reduction in capital assistance and even termination of their operating license.

North Lake Medical Centre Harvard Case Solution & Analysis

Problem Statement:

In the recent past, the hospitalmade huge profits,but now the hospital is incurring losses. The primary reason for the losses is the increase in the operating costs and increase in competition. To avoid further losses infuture, many steps have been taken bythe management, such as revision of the financial and operational targets, the business strategy and organizational structure.

Answer Number 1:

Dr. Hulen has divided the NLMC into three divisions, each division is supervised and chaired by a team member and all the team members have an equal right to take part in setting the policies of the departments.This autonomy explicitly describes the type of the responsibility each member hasand how it is shared by all the team members equally.The collaboration of different team members will play a vital role in achieving the objectives. By analyzing the case study, it can be said that the surgery and medical departments are the revenue centers and the Pediatrics is the cost center.

Profits centers are the responsibility centers which are responsible for increasing the benefits of the division by reducing the expenses and increasing the revenues. The comments made by Mr. Grant also depict the type of responsibility, the departments has to take; he stated that three major operating divisions would have increased $4 million in volume and case mix improvements................

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