The Cleveland Clinic Foundation: An Analysis and Research
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[The Obama Administration ushered in a new era of health care reforms under the Affordable Care Act, seeking to effectively end the sweeping confusion and high costs of medical services in the United States. The Cleveland Clinic Foundation is an important example of this country's finest medical service institutions which has had to deal with key external factors while striving to implement its worthwhile goals, strategies, and objectives. This paper discusses an analysis from the perspective of a management consultant.]
Several influencing considerations impact upon the organizational well-being of the Cleveland Clinic Foundation, a highly competent and compassionate health care center. As a new era in global economics unfurls, it must continue to shoulder the role and responsibility for an effective business strategy. As a non-profit healthcare organization, the Cleveland Clinic Foundation employs rigorous standards to meet its dynamic business functions in addition to operating a value-chain set of activities in the medical industry. This paper endeavors to deliver a cogent and complete analysis of the key external factors, shaping policy and correlated outcomes, of the Cleveland Clinic Foundation. Such factors have serious implications for successful implementation of the organization's strategies, goals, and objectives.
Thereby, the examination herein discusses the organization's industry and competitive conditions currently affecting it, or is likely to do so in the future. The main concept advances an approach to the analysis from the perspective of a management consultant, having adequate expertise in all stages of strategic development and familiarity with the implementation process. Business observer Linda Ray explains "The global economy is one of the biggest external factors," and "market fluctuations" are a fact of life, considering accompanying factors such as infrastructure, finance, laws, trends, and natural phenomena such as weather ("Seven External Factors of Business"). Briefly then, the task describes the industry in which the Cleveland Clinic Foundation operates, yielding a synopsis of current conditions in the macro-environment and likely implications – as aforementioned – for successful implementation for strategic goals and correlated activities. While it is true that any number of corporate partnerships and stakeholder coalitions may exist, the external factors drive the overview of issues herein.
Body – Analysis
The Cleveland Clinic Foundation as a medical organization frequently, and constantly, rotates around myriad specialties providing clinical/hospital care services via a network of logistical facilitators. The organization's stakeholders need be aware that the organization's facilities offer a center-point of pro-active engagement for patients, patrons, and families according to their recent global report ("Serving Our Present, Caring for Our Future, Global Citizenship," 2013). The fundamental proposition of the clinic-hospital institution rests upon a proven track record and establishment of an integration with educational entities and top research. According to one review, the Cleveland Clinic Foundation's main campus "comprises of state-of the-art buildings for cancer, heart, eye and urologic care; a hospital; a children's hospital; an outpatient clinic; a research institute with supporting laboratories and facilities," coupled with surgical and family-health centers ("Cleveland Clinic Foundation"). In fact, the 2014 Interventional Pulmonology Award went to Dr. Atul Mehta, a physician at Cleveland Clinic who has devoted his entire career to the scientific diagnostics of bronchology, having further distinguished himself (and the Clinic) by founding the Journal of Bronchology ("Interventional Pulmonology," B18). This impressive recognition speaks well of the organization's value chain.
The Cleveland Clinic Foundation's value chain should not merely be considered as a non-profit organization, but rather as a medical beehive if you will, of a plethora of profit-building strategies, operations, logistics, sales, and management. One strength that confronts the challenges of the external environment is the center's word-of-mouth advertising and marketing. Given the widespread operations of various departments of specialties and sub-specialties, keeping a keen watch on the viability of its value chain network demands astute attention and re-adjustment in the prominent establishment of the global economy. Several principles located in the global report on the Cleveland Clinic Foundation suggest business strategies to help nullify any problems correlated to, or stemming from, the external environment. These factors include: (a) a "precautionary approach" to challenges, (b) undertaking "initiatives" to meet greater responsibility, and (c) encouraging the development of new technologies ("Serving Our Present, Caring for Our Future, Global Citizenship," 2013). In light of the many areas such as ophthalmology, pediatrics, oncology, and pain management sectors of the hospital-clinic, Herman explains that Cleveland is keeping a keen strategic eye on its financials by holding "expenses in check last year, a major reason why the system was able to post high margins," embracing a smart strategy to compete with others in the industry ("Cleveland Clinic's 2013 Total Profits Exceed $900M"). Obviously, a goal well met in buffeting economic snares, the organization has successfully implemented this particular move. According to the same report, the outstanding growth can also be attributed to smart "massive" investment moves in terms of derivative gains – which certain helps to propel the organization leaps and bounds over its competition.
Who are Cleveland Clinic Foundation's fiercest competitors? A report from the Pharmaceutical Business Review cites its top competitors as: Lake Hospital System, Inc., Kaiser Permanente, Lahey Clinic Foundation, Inc., Legacy Health System, Robinson Memorial Hospital, The MetroHealth System, and University Hospitals of Cleveland ("Cleveland Clinic Foundation"). With an average of 3,200 employees, the Cleveland Clinic Foundation locates an ambulatory setting of surgical centers at its northeast Ohio offices, and also operates locations in Nevada, Florida, Canada and Abu Dhabi in the United Arab Emirates according to the same source. A major part of the Cleveland Clinic's strategy is to incorporate an effective strategy that embraces design and leadership. Given the working definition and understanding of the role of leadership, in terms of influential behavior, the organization thrives upon its intelligent and timely decisions that have obviously allowed the group's financial sector to make such wisely profitable investments. Successful participation in the walking the financial tightrope in the money markets' derivatives game is no easy feat. On top of that, operational oversight of the many eleven hospitals Herman explains, includes management of its "3,500 staff beds, including its flagship academic medical center in downtown Cleveland, and it also has an international presence" as previously mentioned ("Cleveland Clinic's 2013 Total Profits Exceed $900M"). External factors bear heavily for all industries today. But the modern world has placed particular weight on health care facilities and services in the globalized marketplace, to keep up with technologies, cost-effectiveness, and responsible delivery of patient services to an audience increasingly aware of the world's environment.
While it is most certainly logical to focus upon the external factors involved with strategic approaches to the Cleveland Clinic Foundation's sustainability, and ongoing development, a mention of internal resources as a critical way to actually implement a proper strategic protocol deserves attention at this juncture. The organization empowers itself with strong internal resources, having the flexible capability to be deployed as managing leadership sees fit. It has enjoyed recognition for being able to garner strengths in this area, yet the real-world fact of the matter always seems to rotate back to money. No organization can expect to reasonably function without the effectiveness of formidable cash and financial resources. Cleveland Clinic Foundation's impressive ability to implement excellence in its investment decisions has skyrocketed its profitability ‘pocketbook' to having taken in an operating profit in 2013 of "almost $294 million on $6.45 billion of revenue, giving Cleveland Clinic a 4.6 percent operating margin," nearly doubling "that of 2012, when the organization posted $157.1 million of operating income on $6.19 billion of revenue" ("Cleveland Clinic's 2013 Total Profits Exceed $900M"). Commercial taxpayers, Herman continues, support just over 60 percent of patient service in terms of net figures, and of course there are the Medicare and Medicaid percentages that contribute respectively "29 percent" and "10 percent" ("Cleveland Clinic's 2013 Total Profits Exceed $900M"). Having reported such, money means nothing without high-quality care.
One key strength for the Cleveland Clinic Foundation is its provision of ethically-aware superior quality in healthcare delivery at a price reflected what most people feel, is derived from one's neighborhood clinic in a payment ranged still deemed as affordable. Much effective teamwork pulls it altogether, which accounts for the organization high sense of communication between professionals. The labor standards are second to none. According to the global report, the Cleveland Clinic Foundation's performance in delivering job satisfaction and training indicate an uncompromising organizational dedication to quality care, and employee empowerment given to individual workers. In fact, deliverable high-quality in patient care goes hand-in-hand with Cleveland Clinic's social educational programs that assist and involve its employees. Focus groups wherein both caregivers and patients have participated, each group consistently has voted that Cleveland Clinic's quality extends to areas of social responsibility, "Patient Health and Safety," "Community Interaction," "Community Benefit," and outstanding business ethics along with recycling of waste control ("Serving Our Present, Caring for Our Future, Global Citizenship," 2013, 8). Part of Cleveland Clinic's goals and strategies ambitions is to always practice a patient-centered concern in terms of care approach. A key strategy and daily objective maintains that patient safety be reflected, for example, in the manner in which policies on "hand washing protocols for caregivers" are carefully followed, along with an astute awareness of epidemiologic strategic applications that effectively results in a reduction of "hospital-acquired infections" ("Serving Our Present, Caring for Our Future, Global Citizenship," 2013, 10). This strategy alone can save lives by prevention from persons becoming infected in the first place. It is common knowledge that Ebola is on the loose on the planet, with full-blown news reports enumerating the horrors surrounded with its recent outbreak in certain areas of the world. By mitigating further possibilities of infections of patients, the Cleveland Clinic Foundation's policy of strict adherence to latex glove behaviors, and so forth through its Safety Event Reporting System helps guide the entire staff towards fulfillment of lowered risks for everyone.
As an identified core competency, health cautionary policy is not the only strategic goal so implemented in the Cleveland Clinic Foundation business atmosphere. The organization has received national recognition for strategies and approaches that embody innovative effectiveness. For example, once again according to the global report, Cleveland Clinic Foundation received in 2012 the "Patient Voice Award" based upon a nationwide survey across all "academic medical centers" in the known database ranking its consortium of hospital/medical services as superb in the areas of "patient safety, mortality, clinical effectiveness and equity of care" ("Serving Our Present, Caring for Our Future, Global Citizenship," 2013, 12). While competitive forces exist within all global healthcare environments, the external factors do not threaten the stellar operational and strategic quality with which the Cleveland Clinic Foundation implements all its process developments. Living in the modern world today, no one can avoid the ubiquitous digitalization of society and the Cleveland Clinic has successfully implemented a wonderful way to put it to use.
Most everyone has heard of the Electronic Medical Record (EMR), or Electronic Health Record (EHR) system in place in most of the healthcare industry's facilities. Cleveland Clinic Foundation has taken special actions to implement their e-tools for the utilization of linking communication and coordinate care. The system is called "MyChart," which is an Internet-based service which gives Cleveland Clinic patients the ability to "access a portion of their own medical record," once more reflecting superb strides in implementing various stages to develop better processing protocols ("Serving Our Present, Caring for Our Future, Global Citizenship," 2013, 12). Virtually impossible, is how the same source describes the chances that any information will be lost, thanks to the digital advancements in medical recordkeeping. This feature alone demonstrates Cleveland Clinic's early adoption of the system as proof of its leadership in the industry.
In addition to robust ethically-driven internal resources, dedication to workable and successful implementations, and ongoing strategic engagement of technological tools, Cleveland Clinic Foundation has demonstrated its goals amidst the current conditions in the macro-environment. Keeping patients happy is a critical element to effectively outperforming the organization's competition. For example, Walt Glazer reports how his family has enjoyed the benefits from the hospital-clinic institution for "many years," while admiring the "beautiful facilities," noting the excellence of care received from staff also quoting one CEO – Toby Cosgrove of ‘State of the Clinic review' as saying "no organization can be healthy if it is not growing" ("Can we afford the Cleveland Clinic – Walt Glazer"). Apparently, upper management at Cleveland Clinic has considered the financial ramifications by demonstrating its successful strategy and implementation of investment skills. All over America, talk of outrageous costs of healthcare, which the plans of Obamacare have sought to mitigate, dots the conversational national landscape of opinion. While there are no easy answers in trying to smoothly integrate into a global economic system, the often imbalanced reality is that there will be losers and winners in surviving organizations throughout the world. The Cleveland Clinic Foundation is proving repeatedly that it has the right goals, the right strategies, and the right objectives at the right time.
Flexibility and adaptability are also key components in keeping a successful edge against competitive forces. Kokemuller discusses approaches from a value chain analysis approach to winning over the competition by selling "strengths to the market," and building competitive advantages by "improving efficiency in logistics processes" because then the company can allow for a smooth continuum in value-added sales, and completing "revenue-generating activities in the chain" ("Difference between Value Chain Analysis"). One fantastic bit of evidence why the Cleveland Clinic Foundation is way ahead of the game, is its word-of-mouth marketing strategy – which is one that money cannot buy. Optimization of its value chain proposition and strategy has tied many elements together to create a strong bundle of services, and overall powerful organization that steadily profits while retaining an admired position of leadership in the field, in terms of its specified medical industry.
In an article posting an overview of external factors of which to be aware, one observer notes key areas that impact an organization from externalized forces. Linda Ray explains that apart from the global economy, emergency situations associated with the weather such as hurricanes, fires, or storms can disrupt a firm's operations. As all hospitals in the United States, Cleveland Clinic Foundation certainly has backup energy-generation systems in place. But the main strategy so diligently applied by Cleveland Clinic is their focus upon the next generation in the future. One neighborhood community, for example, has enjoyed the fruits of Cleveland Clinic over the past few years specifically served by the Foundation's ‘Langston Hughes Community Health and Education Center.' It is truly refreshing how the organization has taken pro-active steps to establish help for a portion of the community at large in sharing provisions of "nutrition assistance and in-home senior services" in Fairfax, because its "34 percent poverty rate" reflects a crucial need for free screenings, assessments, and counseling ("Serving Our Present, Caring for Our Future, Global Citizenship,"). Recommendations and final comments follow.
Demonstrating a strong alignment between its goals, strategies, and implemented successes, the Cleveland Clinic Foundation has managed to develop and offer new paradigms in superior advanced healthcare. Its strong brand recognition continues to push its advantages forward. Having established a clear competitive advantage in the macro-environment of its industry, Cleveland Clinic Foundation wisely has seen the benefits of ensuring growth, encouraging responsible behaviors via policy, and utilizing technology to the benefit of patient informed knowledge. One recommendation would pose a gentle warning that an expansion into the new and untested waters of global localized establishments, must contend with unfamiliarity in cross-cultural realities, and the challenges of foreign regulatory procedures. Otherwise, the Cleveland Clinic Foundation should continue its upward mobility in stabilizing and increasing profits, while remaining the benchmark of reaping the rewards of organizational success.
Glazer, Walt. "Can we afford the Cleveland Clinic?" Walt Glazer."
Herman, Bob. "Cleveland Clinic's 2013 Total Profit Exceeds $900M."
"Interventional Pulmonology Award for Cleveland Clinic Doctor." India – West.
Kokemuller, Neil. "What is the Difference between Value Chain Analysis & Resource-Based Analysis?" smallbusiness.chron.com Houston Chronicle – Hearst Newspapers, n.d. Web.
Ray, Linda. "Seven External Factors of Business." Smallbusiness.chron.com Houston Chronicle – Hearst Newspapers, n.d."Serving Our Present, Caring for Our Future." My.clevelandclinic.org Cleveland Clinic.
"The Cleveland Clinic Foundation." Pharmaceutical-business-review.com PBR – Pharmaceutical Business Review.