The Cleveland Clinic Growth Strategy 2008 Case Solution

1. Problem Statement

This case covers the history of the Cleveland Clinic. The clinic has been operating since 1921 and has developed itself into a hospital that has been ranked among the best hospitals in the US. It specializes in many facilities, cardiovascular surgery being the elevation of the clinic’s success initially. The clinic has been successful in innovation, growth, culture, values, improvements, and cost-cutting. The clinic plans to expand its operations in other countries. The clinic has a wide range of opportunities to choose from including telemedicine and international expansion. The problem is that investment is limited. This is a decision case.

2. Analysis

There are several options for Cleveland to improve its short-term performance. The investment in these areas would lead to lower investment and lower management issues. The improvement in these systems can be done since the avenues that can be classified under the short-term benefits are already established. These options include the affiliate program that has been a program at the clinic for a long while. The national telemedicine system can be improved with low investment since the system has already been established. If the strategic alternative is that of cost-cutting and improvements, the short-term growth opportunities will work for the clinic.

However, if the clinic plans to expand to obtain long-term benefits, high levels of investment should be made in these growth avenues. Although Cleveland had expanded into these avenues before and had the expertise to adapt to the change, these options are the inclusion of other units into the Cleveland brand. These alternatives include mergers, development of out-of-state hospitals, and international expansion alternatives. The investment is high, but the benefits are long-term. Also, the establishment of the culture presents at Ohio in the newer units, and the competition from the other already established hospitals in that area are difficulties for these alternatives.

 3. Strategic Alternatives

The first alternative is the development of the already present systems. These systems include the facilities of telemedicine and affiliate programs. The growth of the existing affiliate program would mean that the quality is increased for the affiliates. It means new practiced employees for Cleveland. The pros of this alternative are also that the clinic will cut the costs for the other functions. These functions include training, management, marketing, and technology improvement of other affiliates. The affiliate program gives the benefit of the clinic being referred for complex cases. The affiliate program is already developed, and growth in it would further increase the clinic’s reach. The telemedicine has the advantage of treating patients who are not nearby to the physical clinic facility.

However, the inclusion of affiliates under Cleveland management as employees has certain cons including increased wound infections and doctors not responding to pagers. This could damage Cleveland’s brand name. Also, the con is that only the complex cases will come to the clinic. Even though Cleveland hires many affiliates, it still poses some degree of threat to the profitability of Cleveland. Their competitive advantage is their services, culture, and management. Sharing that with other organizations is an increase in the competition. Telemedicine has twice the diagnostic error level as a regular diagnosis. This means that Cleveland’s credibility would be affected because of the error levels.

The second alternative is to invest in newer units.