Strategic Management Accounting at Regis Healthcare

This assignment examines the application of strategic management accounting principles within Regis Healthcare Limited, an Australian healthcare provider. Students will analyze Regis Healthcare's financial strategies, focusing on cost management techniques, performance measurement systems, and the integration of corporate social responsibility into their operations. The analysis utilizes various accounting tools and frameworks to evaluate Regis Healthcare's effectiveness in managing its resources and achieving its strategic objectives within the challenging Australian healthcare market.

Strategic Management Accounting

Introduction
The present report aims to present an analysis of the strategic management functions
of the Regis Healthcare Limited. The Regis Healthcare Limited is recognized to be the largest
ASX listed Residential Aged Care (RACs) having a market share of about 2.5%. The
company aims to become an innovative, dynamic and creative industry leader through
providing high quality aged services through effective management (Regis Healthcare
Limited, 2017). In this context, this report analyses the strategic management of the Regis
Healthcare Limited in detail on the perspective of a Strategic Management Accountants
(SMA).
Value Chain of Regis Healthcare Limited through the Use Of Strategic Management
Tools
Regis Healthcare Limited operates in healthcare industry and as such the term ‘value’
for the company indicates its speed, quality, cost and availability of healthcare services. The
value chain of the company can be enhanced through the application of strategic management
tools of value chain analysis. The value chain analysis (VCA) refers to the method adopted
by a firm to identify its primary and secondary activities that helps in developing the valuable
products and services for the customers. The goal of this strategic management tool is to
segregate the most valuable activities within the firm such as operations, logistics, marketing
form the support activities that are, infrastructure, technology and others. The value chain of
the healthcare company will consist of activities similar to that of other industries such as
manufacturers, wholesalers, distributors, providers, professionals (nurses, midwives) and
payers (heath consumers). These all can be stated to be the primary activities of the
healthcare company that plays a vital role for it to achieve competitive advantage in the
marketplace (Ginter, 2013). The value chain of Regis Healthcare Limited can be depicted as
follows:

Source: http://groundwork.mit.edu/cdvc/
Examination and Implementation of techniques for Developing, Implementing and
Monitoring Strategies
The techniques for developing, implementing and monitoring healthcare strategies
can be described as follows:
 Developing Strategies: The techniques for developing healthcare strategies are
examining the medical history of patients that helps in identification of the healthcare
services to be provided to the patients. This is followed by carrying out the specific
tests for proper identification of the healthcare problem and then developing a
healthcare strategy for the treatment of a specific problem.
 Implementation: The implementation can be done by performing the treatment
procedures for the patients such as counselling of patients or providing them specific
type of medical help as required by the patients.
 Monitoring: The monitoring strategies include reviewing the condition of the patients
on a continuous basis in order to examine the impact of treatment procedures on the
patients. This helps in modifying the treatment procedures as per the patient’s
condition (Swayne et al., 2012).
Strategic management cycle and the Leadership Role of Professional Accountants in
Strategic Management

The strategic management cycle of the Regis Healthcare will consist of the following
steps:
 Setting of Goals: This is the most essential step as it requires the identification of
adequate healthcare goals that is to be achieved by the company. This can be
improving access to care, reducing healthcare cost pr providing speedy care services.
 Developing Strategy for Enhancing Value: This includes developing specific
strategies for achieving the goal determined for adding value to the healthcare
services such as measuring cost and outcomes of each patient, adequate structuring by
developing integrated practice units, expanding the geographical reach of the
company or using high technology medical equipments.
 Execution: This is the last step that involves developing specific plans for
implementing the strategies developed (Ginter, 2013).
The role of healthcare professional accountants is very important in the strategic planning
of the healthcare company such as Regis Healthcare Limited. The professional accountants
are responsible for cost management through developing healthcare budgets that help in
maintaining an adequate balance between the cost and expenditure. The development of
financial budgets helps in eliminating the unnecessary costs those significantly increases the
costs of the healthcare facilities (Swayne et al., 2012).
Role of organization and Industry Value Chain Analysis
The role of healthcare firms such as Regis Healthcare Limited is very important in
improving the health condition of the aged population of the Australia. These healthcare
firms help in promoting the welfare of the senior citizens of the country through increasing
their access to healthcare services at reduced cost. The value chain analysis of the healthcare
industry consists of the primary and secondary activities. The primary activities consist of the
most important functions that help it to attain a competitive advantage such as manufacturers,
wholesalers, distributors, providers, professionals (nurses, midwives) and payers (heath
consumers). The secondary activities consist of the government legislations and technologies
that impact the carrying out of primary activities.
The company through identifying the primary activities can develop effective
strategies to reduce the cost of healthcare facilities that enables it to achieve competitive
advantages. The reduction in the cost of healthcare facilities is important for the companies

operating in Australian healthcare sectors as this is the most serious issue faced by the
industry in the present context. The secondary activities of the company’s value chain can
consist of government policies, technology and some other industries such as insurance
companies. These all also plays a significant role in maintaining the quality and cost of
healthcare services through interacting with the primary activities (Huda, 2016).
Characteristics of effective strategic and corporate social responsibility related
performance measurement and control systems
The strategic performance of the company can be measured and controlled through
the implementation of the Strategic Management System (SMS). The system will help in
aligning the goals and objectives of the company as per the resources available. The strategic
measurement system is a measurement-oriented approach that helps in developing specific
annual improvement targets for the company. The corporate social responsibility systems are
necessary to be implemented in the healthcare companies for ensuring the welfare of the
patients. The CSR systems would helps in promoting the transparency in the heath care
organizations for achieving the trust of the patients. The CSR system that can be
implemented in the healthcare organizations are waste management system and effective
governance system. The healthcare companies through reducing the waste elimination can
promote the welfare of the existing societies as they generate waste materials on large
amount. Also, the governance system will enable development of standard guidelines and
procedures for the healthcare professionals to carry out their job roles for ensuring the quality
services to be provided to the patients (Lachman, 2005).
Strategic Management Accounting Techniques
The healthcare professionals need to develop a proper budget for estimating the costs
and expenses related to the healthcare projects. The professional accountants have an
important role of developing financial budgets that helps in identification of the costs and
expenses related with a project. The development of the budgets helps in section of the most
appropriative cost management strategy for reducing the costs of the healthcare services of
the company. The rising cost of the healthcare service is the most important issue faced by
the healthcare industry of the Australia. Therefore, it is most important for the professional
accounts to implement the cost management strategies through developing the financial
budgets. It will help in reducing the operational cost through eliminating the insignificant
business operations and therefore improving the profitability of the healthcare companies.

Therefore, it can be said that cost management is the most important strategic management
accounting technique required for selection, planning, implementation, control and
monitoring of projects (Hankins and Baker, 2004).

References
Ginter, P. 2013. The Strategic Management of Health Care Organizations. John Wiley &
Sons.
Hankins, R. and Baker, J. 2004. Management Accounting for Health Care Organizations:
Tools and Techniques for Decision Support. Jones & Bartlett Learning.
Huda, F. 2016. The Impact of Strategic Management on the Performance of Health Care
Organizations (A Study of Three Selected Tertiary Health Care Center of Karachi, Pakistan).
Arabian J Bus Manag Review.
Lachman, M. 2005. Strategic management accounting practices in hospitals: Empirical
evidence on their dissemination under competitive market environments. Journal of
Accounting & Organizational Change.
Regis Healthcare Limited. 2017. What Investors Should Know About Regis Healthcare
Limited’s (ASX:REG) Financial Strength? [Online]. Available at:
https://simplywall.st/news/2017/01/26/what-investors-should-know-about-regis-healthcare-
limiteds-asxreg-financial-strength/ [Accessed on: 13 October 2017].
Swayne, L. et al. 2012. Strategic Management of Health Care Organizations. John Wiley &
Sons.