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CareGroup Case Solution

Solution Id Length Case Author Case Publisher
2886 1609 Words (7 Pages) F. Warren McFarlan and Robert D. Austin Harvard Business School: 303097
This solution includes: A Word File A Word File

The case introduces a team of medical professionals, committed to offering healthcare to a wide range of patients living in the Massachusetts region. The Beth Israel Hospital, Deaconess Hospitals, and Mount Auburn Hospital merged to form the health care service group, which was established in October 1996. Physically adjacent to one another, the three hospitals combined to become one. It saw the consolidation of all of their departments under the leadership of one person. Similarly, the case study tells the incredible story of how the health care company CareGroup's top-notch, cutting-edge information technology (IT) systems unexpectedly failed for three and a half days, what steps they took to recover, and the priceless lessons they learned as a result. The three hospitals joined to form one of the greatest healthcare networks that was to operate online. In brief, CareGroup was a team of medical experts that provided primary care in the community and a wide range of specialty services.

Following questions are answered in this case study solution

  1. List at least two strengths of the environment at Care Group. List at least three weaknesses that lead to the collapse.

  2. Whom would you blame if you were the CEO of Care Group?

  3. What caused the outage at Care Group?

  4. How well did the company handle the crisis?

Case Analysis for CareGroup Case Solution

1. List at least two strengths of the environment at Care Group. List at least three weaknesses that lead to the collapse.

  • The business had access to the industry's top-notch data center, and had an exceptional web-based infrastructure. CareGroup’s IT department processed 40 gigabytes per day, while 3,000 doctors and 200 staff members processed 900,000 patient records dating back to 1977. During that period, such infrastructure was considered state-of-the-art. 

  • Secondly, John D. Halamka, CIO of CareGroup, was another important factor in the company's success. Halamka talks about how he has been lucky in this job because he understands all the technologies, can write code in 12 languages, and has written books on the system administration hosted by Unix.

  • Lessons from the catastrophic event highlighted the factors that finally contributed to the network collapse. CareGroup neglected the requirement to keep their IT system updated and under control before the catastrophe because it mistakenly thought it had the most sophisticated network in the healthcare business.

  • Every CareGroup's system was controlled by a single switch, which was, in fact, administered by an individual, eventually leading to the point of failure. The company lacked a group of personnel charged with monitoring and controlling ongoing IT advancements and how they affected the entire network.

  • Finally, the CareGroup employees, prior to the network collapse, did not respond to dangers as effectively as they did to opportunities. No business should ignore the threat posed by the IT industry's rapid speed, regardless of how sophisticated its network may be. The IT team at CareGroup had to learn this lesson above all others. After the systems failed, they waited one day before contacting Cisco. And throughout the day, they attempted to repair the network on their own without knowing the root cause of the issue.

2. Whom would you blame if you were the CEO of Care Group?

The board of directors was to blame for the cause if I were the CEO of CareGroup. This is because CareGroup faced a sudden downfall because they could not make appropriate decisions while the company was to be established. A whole department that was to function as the IT operations was missing in such a large company, and it was the major reason the company faced such a catastrophe. The root of the issue was CareGroup's failure to prioritize IT operations for the business. CareGroup reduced IT capital expenditures and operating costs, going from $50 million in 1998 to $25 million in 2001. However, the ignorance of enterprise network infrastructure was the real cause of the issue, not the underinvestment in infrastructure.

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