What have I learned this week : KPJ HEALTHCARE GROUP

Assalamualaikum..

What have I learned this week?

Today, I would mind to share about our case study discussion in tutorial class for the past few weeks.

The cases study that has been discussed is KPJ HEALTHCARE GROUP. 

Kumpulan Perubatan Johor (KPJ) Healthcare Group was the largest public-listed Healthcare service provider in Malaysia. At the time KPJ operated 19 hospitals in Malaysia and managed two hospitals in Indonesia. However, in 2008, the effect of the US financial crisis was felt in many countries, including in Malaysia. Then because of this crisis the demand for KPJ Hospital services may decrease.

Then, by the end 2009, pressure was mounting on Siti Sa’diah and her management team to make urgent decisions on how to survive the economic slowdown and The team had three options, first is KPJ Healthcare Group could expand its business by focusing on the medical tourism market, which was expected to continue growing in the next few years, then KPJ could expand its college business, in particular because of the need to provide      nurses to its own hospitals and also to support overall rapid expansion of the medical markets or KPJ could further expand its international market.

Moreover, in order to growth the strategies in KPJ Healthcare they have to issue of funding the business expansions. While in 2006, the effort to raise funds for its business expansion, KPJ initiated a major shift in its corporate strategy from being an entirely asset-based company to one that stayed light on its assets through securitization and was accomplished with the establishment Al-‘Aqar KPJ Real Estate Investment Trusts (REIT), which had played an important role in facilitating KPJ’s strategic expansions (KPJ Healthcare). Grow the company’s business.

The question that has been given by Madam Ummi was what were the strategies implemented by KPJ Healthcare prior to 2009?

It was secondary level strategies when KPJ Healthcare was have expansion strategies with Puteri Nursing College with the objective of providing nursing education and providing the human resources required by its group of companies and also the country in 1990 in order to opened their education nursing. While in corporate level strategies under the tactical strategies, KPJ Healthcare was partnered with Penawar Hospital through a joint-venture agreement of 30-70 percent share in 1995. In addition, in 2002, KPJ Healthcare also established a joint-venture project with the Kelantan State Economic Development Corporation to operate the Perdana Specialist Hospital in Kota Bharu, Kelantan. In 2002, KPJ established a subsidiary, Pharmaserv Alliances, which functioned as a wholesaler and distributor of pharmaceutical, medical product, and other hospital related products focusing on servicing KPJ-owned hospitals

The second question was based on the company goals, propose 3 strategies options for growth in KPJ HEALTHCARE.

From my opinion, KPJ needs to establish some strategies that may help them to support their strategic expansion. First of all, we think that KPJ need to do a joint venture with international companies such as from Indonesia, Singapore, Thailand and any other countries. Expansion plan will support KPJ for a long term growth. Competition was getting intense a more players are including foreign based private healthcare providers were entering the Malaysian market.

Even though the competition was good, KPJ need to move faster to enter foreign market as well. The competition was good as it can help to increase the standard of the private healthcare services. In the next following year, KPJ should focus to do joint ventures with private hospital in foreign market to promote their names in international market. KPJ need to make a new entry outside Malaysia because their names are formally known in this country.

The second strategy that needs to be paid attention is organically grown by backward regression. KPJ needs to think something new such as to produce their own medicine and be a supplier of that product to another hospital, clinic or pharmacy. Their customers also do not need to go to KPJ hospital but instead just bought their medicine at the pharmacies available around Malaysia. Instead of that, KPJ also can send their students in KPJ nursing education to another hospital and gain profit from that. In the effort to overcome the shortage of nurses, KPJ should grab this opportunity to be a supplier for these nurses in this industry.

The last strategy that we propose to KPJ is to establishing their line of franchising.  A franchising will increase a business success because the KPJ branding is already all over the Malaysia. KPJ is already an establish name of good service that may already enjoy widespread brand name recognition. KPJ may offer franchising to open at Sabah and Sarawak because there is none of KPJ service there. It can be a good strategy because KPJ need to expand their services all over the Malaysia.

In order to achieve their goals to increase their number of hospitals, we think that they should use the technique and advantages of franchising properly. For the other goals to expand their business internationally, we suggest for them to do a merging with another international private healthcare.

Knowing how to analyze a case study is a really great thing because this is one of our questions during final exam later. Insya Allah with Madam explanations and all activities that we have done during tutorial class, it will help me a lot.

Until then, wassalam. 

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currently I'm keeping an eye on one person, but I'm not a nutty as a fruitcake. saranghae.

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What Have I Learned This Week : Corporate Level Strategies

Assalamualaikum..

What I have learned this week ?

Today, I would like to discuss the kinds of strategies that I have been learned in our lecture for the past weeks. Basically, the strategies can be group into 3 broad levels of decision making namely, corporate level strategies, business level strategies and functional level strategies. These 3 level of strategies is been done from different method and different circumstance within the organizations.

First of all, corporate level strategy is meant to looking for the overall movement of the organization. The Corporate level strategies have the priority to the movement and action of the entire organization and also their decisions will have to be made at the top of corporate level with the participation from all divisions.

While business level strategy will look at how the organization have to handle things from the competition perspective. An organization has to deal and think of how to compete with their competitors. Functional level strategy has to consider at the various operational level of the organization. Usually, this level has to deals with marketing, financing, management and also the operation divisions to make sure that the overall things have been assist.

In corporate level strategies, it has various levels of the strategies.

GRAND STRATEGIES

•GROWTH

• STABLE GROWTH

• TURNAROUND

• COMBINATION

SECONDARY LEVEL STRATEGIES

•EXPAND

•INTEGRATE

• DIVERSIFY

TACTICAL LEVEL STRATEGIES

• ORGANICALLY

• JOINT VENTURE

• MERGER

• ACQUISITION

• REVERSE TAKEOVER

• STRATEGIC ALLIANCES

• LICENSING/FRANCHISING

The corporate level strategy looks at the whole organization with the helicopter view. The corporate level strategy covers the overall group whether to grow or to do turnaround through the various secondary and tactical strategies. All three level of strategies need to be done in synchronized manner as it all started from the same point of action wanting to be the best organization and better than their competitors. 

Wassalam. 

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currently I'm keeping an eye on one person, but I'm not a nutty as a fruitcake. saranghae.

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What Have I Learned This week : Resources based Theory

Assalamualaikum..

Sincerely from my bottom of heart, I hope all my readers are doing okay. Today’s update, I would like to continue my posting and sharing about what I have learned in my Strategic Management and Operation class for this week. The topic that I mind to sharing today is the Elements of Strategic Management which I will focus on Competitive advantages.

What is the competitive advantage?

Competitive advantage allows an organization to outperform its competitors. An organization gains competitive advantages when they are able to perform or doing an activity that other company are unable to duplicate them. While sustained competitive advantages refers to a competitive advantage that an organization can maintain for a long period of time.

In this topic, I learned about Resources-based-view which is strategic management idea that each firm has their own unique and possesses resources and capabilities that provide the basis for its competitor advantages. Resources are referring to inputs such as equipment, human resources or process and that input can be a production process. They can be divided into 3 categories: tangible, intangible and human resources.

Tangible resources are assets that can be seen such as materials while intangible resources are assets which we cannot be seen such as knowledge. Human resources will include people’s skills, abilities and experiences.

According to RBV theory (resources-based-view), a resource can only be a source of competitive advantages when it is unique. A characteristic of unique resources are:

VALUABLE

RARE

HARD TO IMITATE AND SUBSTITUTE

ORGANIZATION HAS THE ABILITY TO EXPLOIT THE RESOURCES

The more of such qualities the resources has, the more important it is a source of competitive advantage.

This is the explanation of the V.R.H.O

Valuable would answering the question of does the resource create value for the firm in delivering the firm’s products and services.

Rare is something that we find that the current or potential competitors possess this resources or not. A resource should be rare to be a unique and valuable.

Hard to imitate and substituted is a resource that we find it is hard for the current and potential competitors to develop a substituted for this resources.

Organized to exploit is the question regarding does our firm have the necessary systems, policies, procedure and processes to take full advantages of this resources in order to develop it into a competitive advantage?

To become a good organization and to have the strength among the competitors, a firm should follow the RBV Theory to gain the innovative resource and gain profits for the company. That’s all from me for this week lesson, till then wassalam.

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currently I'm keeping an eye on one person, but I'm not a nutty as a fruitcake. saranghae.

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What have I Learned This Week : Objectives

Assalamualaikum..

For the last post, I already explained what is vision and mission in organization as well as why we should have vision and mission in our life. Besides vision and mission, an organization should establish their objective. An objective is a specified result of a planned activity that should be achieved by a specified time.Objective in the organization have a really strong ties with their vision and mission. The achievement of organization objectives should result in fulfilment of an organization mission. Right?

In one company, their objectives may be short, medium or long term. Objectives can refer to the result of desired for the entire organization. We can measure an organization objective through S.M.A.R.T philosophy. S.M.A.R.T is an acronym that is used to guide the development of measurable goals.

Specific

Measurable

Achievable

Relevant

Time-oriented

Specific answer the question of ‘’what is to be done’’ and describe the result of the work to be done. While measurable answer the question of ‘’how will you know its meet expectation’’. It refers to the something that we can measure using some standard such as using percentages. Achievable answer some question such as ‘’ can the measurable be achieved by the person”. Relevant answer the question of ‘’should it be done?’’ or ‘’what will be the impact’’. And the last acronym is time oriented. Time oriented will answer the question of ‘’when it will be done’’. It refers to the some objectives that have an end point.

As we began to write up our objectives, completing answering these S.M.A.R.T is really helpful and beneficial in our life. Thank you and till then, wassalam. 

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currently I'm keeping an eye on one person, but I'm not a nutty as a fruitcake. saranghae.

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