Strategic Management Report: Analysis of Lanka Hospital's Strategy

This report provides a strategic management analysis of Lanka Hospital, evaluating strategic options using the SAF model, Porter’s Value Chain, and Mendelow’s Power Interest Grid. It explores the suitability, acceptability, and feasibility of strategic choices, focusing on new market development and product diversification. The report identifies key stakeholders, assesses resource requirements, and suggests ways to make projects greener and socially responsible. It concludes with recommendations to enhance the company's value through strategic decisions and efficient resource allocation, emphasizing the importance of aligning strategies with the company's mission and goals. The analysis includes detailed examinations of the company's internal and external environments to provide a comprehensive strategic overview.

STRATEGIC MANAGEMENT

Executive Summary
 The changes in business environment results into constantly assessment
of strategies for the success. This involves strategic planning as well as
strategic thinking. Hence, this report aims to discuss strategic options
by using SAF model of Lanka Hospital. Further, potential strategic fit of
the chosen option with the existing activities of business will be
discussed. Moreover, key stakeholders will be identified in implementing
strategic option. In addition, evaluation of resources required will be
done. Lastly, potential ways for making project greener and socially
acceptable will be discussed. This report concludes that choice of good
strategic option by Lanka Hospital will help in enhancing value of the
company with the given resources.

Table of Contents
 Task 1- Analysis of Company Using SAF Model-----------------------------Slide
4-6
 Task 2- Porter’s Value Chain Analysis-------------------------------------------Slide
7-8
 Task 3- Mendelow’s Power Interest Grid--------------------------------------Slide-
9
 Task 4- Resources Required in Implementing Chosen Strategic Option---
Slide 10
 Task 5- Potential Ways to make Project Greener and Socially
Responsible—Slide 11
 Conclusion and Recommendation-----------Slide 12
 Reference---------------------------------------Slide 13

Analysis of Company Using SAF
Model
 Lanka Hospital may face some challenges, when deciding upon certain
strategic action for future. The choice of right strategy at the right time can
help in facing the challenges.
 Hence, it is important for the managers to look at the strategy from the
aspects of its viability and value.
 First of all, the managers of Lanka Hospital need to settle foundation by
which different alternatives can be evaluated. In order to assess various
strategies independently, there is a need to choose viable methodology
(Lankahospitals.com. 2020). For the evaluation purpose, there are
selection of the few strategic options, which are as follows:
 Strategic Option 1: New Market Development
 Strategic Option 2: Diversification of the product portfolio

Continued..
 Suitability
 Strategic Option 1- The strategy of developing new market is suitable because it would allow the Lanka Hospital
for developing new market by tapping into the new groups of customers. This will also be allowing company for
penetrating into the existing markets. These possibilities can be achieved because Lanka Hospital highly invests in
the customer research and it has strong financial standing (Gonçalves et al. 2016).
 Strategic Option 2- The strategy of product or services diversification is the second strategic option. This strategy
is suitable because Lanka hospital is having resources as well as information for making strategic decisions regarding
diversification. Further, regular innovation can be added advantage for suitability of this strategy.
 Acceptability
 Strategic Option 1- The strategy of new market development is acceptable because it is in the line with the goals
and mission of company. Moreover, it is also in the line with internal culture and marketing of the organization.
Further, this does not possess any kind of risk, whether financially or any other. It is palatable for the reactions of
stakeholders. This strategy will help in giving higher returns. Hence, it is highly acceptable (Hossain, Akhter and
Emery David Jr 2016).
 Strategic Option 2- The strategy of diversification appears to be acceptable moderately because in this strategy
higher investment of fund will be done and the Lanka hospital will not be sure regarding consumer reactions. Further,
there would be the risk of developing new product and reaction of consumer. There would be low acceptability due to
stakeholders’ reaction (Joyce and Paquin 2016).

Continued..
 Feasibility
 Strategic Option 1- The strategy of new market development is highly
feasible because Lanka hospital is operating in accordance with its
mission and is having higher level of the market research as well as the
information relating to potential group of customers. Further, the
company is financially strong, hence, it would not be great problem for
company for allocating resources (Mascarenhas, Nunes and Ramos
2015).
 Strategic Option 2- The strategy of diversification is feasible for Lanka
hospital because of the strong financial position and ability to research
various trends and patterns of market. It is important for deciding which
industry and market, company needs to diversify.

Porter’s Value Chain Analysis
 Primary Activities
 Inbound Logisttics- The inbound logistics of Lanka hospital is referred to storage, transport and goods delivery into
business. The hospital has its producers in the various locations. It involves selection of the good quality raw materials
from the in-house production and from the third-party contractors. These materials are then transported to the storage
sites, which then uses raw materials for the production of various product required by hospital (Koc and Bozdag 2017).
 Operations- Lanka Hospital operates in Sri Lanka and it is most recognized and reputed hospital in Sri Lanka. The
operations of Lanka Hospital make it better and stand out from the other hospital in the Asian region. It is front runner
in the private healthcare in the Sri Lanka that serves international and local patients.
 Outbound Logistics- The outbound logistics of Lanka Hospital is referred to storage, transport and goods delivery
going out of the business. The hospital is having contracted agents across the countries for managing product selling.
 Marketing and Sales- The marketing and sales processes of the Lanka Hospital persuade the clients for purchasing
from the hospital in comparison to the competitors. This hospital creates value through its sales and marketing by
giving benefits and communicating well with their customers or clients (Simatupang, Piboonrungroj and Williams
2017).
 Service- These activities relate to maintaining products or services value to the customer, once it has been
purchased. Lanka hospital is the well-known brand that invests in the customer service for developing loyalty of
customer and building strong relationships with their clients. Hence, company make huge investments in effectively
incorporating feedback of customer and resolving their queries (Bedeley et al. 2018).

Continued..
 Support Activities
 Infrastructure- The infrastructure of Lanka hospital includes various departments such as marketing, human
resources, legal, finance and others. These departments help the hospital keep running on continuous basis.
 HRM- The committed and well-trained workforce of Lanka Hospital are inimitable and valuable resources for
hospital, which plays significant role in growth and success of the hospital. In Lanka Hospital, the employees
are the professional, motivated, trained and work along side goals and mission of hospital.
 Technology Development- Lanka hospital makes effective and efficient uses of its technology in not only
delivering good services to the customers but also in making whole system of hospital functioning in efficient
manner. The hospital minimizes the cost of technology by staying updated with the advancement of
technology and maintaining technical excellence, which ultimately helps in creating value (Eling and Lehmann
2018).
 Procurement- Lanka Hospitals have various agents working in different regions, are responsible for procuring
high quality materials for delivering quality of products and services to customers.
 Bottom Line- The concept of value chain for Lanka hospital helps to understand way the value is added in
each of the stage and process of the value chain. This also helps in understanding and separate the useful
activities from those, which are not beneficial. It will help to improve overall company’s bottom line and
increase company’s profit margin (Bedeley et al. 2018).

Mendelow’s Power Interest Grid
 Grid A “Lower Interest and Lower Power”- It is the grid of minimal effort. The stakeholders in this particular group are
not interested in company and they do not have that much power either. The decisions in relation to these stakeholders have
lower impact. Lanka Hospital should not much entertain the suppliers with whom it rarely does business. Lanka hospital
should not waste its significant resources in considering the goals of these stakeholders.
 Grid B “Higher Interest and Lower Power”- It is the grid of keeping informed. These stakeholders are having higher
interest level in organization but are having lower power. The stakeholders in this grid are significant because if they are not
kept on knowledge regarding decisions, they may require additional influence and power for running company. In case of
Lanka Hospital, the volunteer groups of hospital provide the services, which are good to have, however it is not that much
essential, so volunteers of hospital are having higher interest but have less power. Lanka Hospital should keep these
stakeholders informed of the outcomes and plans through proper communication (Horton and Pilkington 2014).
 Grid C “Lower Interest and Higher Power”- It is the grid of keeping satisfied. This includes the stakeholders with the
higher power and ability for influencing, what company is up to, however, currently having lower interest in organization. This
is the important group because if they get dissatisfied then it will have great impact on the company’s business operations. In
case of Lanka Hospital, the identified stakeholders in this group includes large suppliers, regulatory bodies, government
agencies and top management from the other departments. This hospital can use the strategy of keeping them informed so
that they do not exert their influence on the operations of hospital.
 Grid D “Higher Interest and Higher Power”- It is the grid of key players. This includes the stakeholders, who are having
lot of influence as well as are highly motivated for expressing their own set of interest. In case of Lanka Hospital, the
identified stakeholders of this group include major customers that is patients, top level procurement managers, key suppliers
and others. Lanka Hospital can make strategies for early participation and involvement. This will help the hospital in
integrating their goals with the hospital’s goals (Ziraga and Wandebori 2015).

Resources Required In
Implementing Strategic Option
 Resources are required by the business organizations for putting it in place in order to pursue the given
strategy.
 Lanka hospital needs to assess its financial resources for further implementing the chosen strategic option.
This includes assessment of existing funds, for instance cash, bank overdraft, capital of shareholders,
working capital locked in, bank and other loans and creditors as well as assessment of ability for raising new
funds that includes reputation and the strength of management team and overall business, strength of the
relationship with the existing lenders and investors and the market attractiveness in which business
organization operates (Proctor 2014).
 Physical resources includes facilities of production and marketing facilities. Production facilities are consists
of location of the existing facilities of production, capacity, maintenance and investment requirements,
current processes of production such as method, quality and organization and the extent to which the
production requirements of the strategy can be delivered by the existing facilities. Moreover, the marketing
facilities includes process of marketing management and the channels of distribution (Stadler et al. 2014).
 Technology resources helps the business in becoming more effective. Lanka hospital should aim to integrate
the technology in their business in such as a manner that it helps in providing the customers with best and
the most innovative systems of communication, technologies, customer support and product that delivers
sustained and superior value to the shareowner (Coreynen, Matthyssens and Van Bockhaven 2017).

Potential Ways in Making Project
Greener and Responsible Socially
 Environmental pollution is having several impacts on the society. The pollution of environment causes
serious problems such as global warming, biodiversity extinction, depletion of the ozone layer and others.
 The large-scale degradation of environment, not only cause pollution but it also jeopardizes existence of the
human society (Karji et al. 2019).
 Lank Hospital is the socially responsible provider of healthcare, which remains committed for protecting the
environment and striving for continuously improving the methods and systems in bid to sustain the task
(Tafazzoli 2017).
 The hospital is committed towards meeting statutory and legal needs for the protection of environment and
they work on continuous basis with the sub-contractors, staff and the public, where possible in all the
aspects and continuously strives for mitigating all the adverse impacts to the environment that arises from
the day-to-day business activities.
 The awareness as well as monitoring of the environmental protection is the passion of Lanka hospital and
they are having the motto to protect the environment for the next generation (Tafazzoli 2017).
 Moreover, in order to improve it more effectively, the potential ways for making greener and socially
responsible project includes Making green thinking as the part of the organization’s culture, changing the
light bulbs, eliminating plastic bottles, doing business with the green vendors, conserving human energy,
hosting fundraising event, recycling and reusing and using green cleaning products.

Conclusion and
Recommendations
 Therefore, this report concludes that strategic options helps in creating alternative
responses that is action-oriented to external situation, which is faced by organization. It
takes benefits of trends, actors and facts, threat and opportunities of outside world.
 In this report two strategic options are analyzed according to SAF model, which includes
new market development and diversification of products or services. In addition, value
chain analysis has been done of the strategic options.
 Further, with the help of Mendelow’s Matrix, different stakeholders of Lanka Hospital are
identified. This will help the hospital in identifying priority stakeholders and therefore, they
can work out the plan for managing communication, while keeping satisfied all the groups.
 Moreover, the financial, physical and technology resources have been discussed for
pursuing its chosen strategy.
 Lastly, it has been analyzed that the socially responsible duty of company is to maintain
perfect balance between economy and ecosystem. They should make an effort and take all
measures to make the projects greener and socially responsible.