Sheffield Teaching Hospital NHS FT is among the largest, most successful, and busiest NHS foundation trusts in the UK. The organization currently employs more than 17000 healthcare workers and is, therefore, one of the crucial employers in the city. It provides a wide range of healthcare and community services for the locales of Sheffield. In addition to this, it manages five well-known Yorkshire's best teaching hospitals, namely Northern General Hospital, Jessop Wing Maternity Hospital, Weston Park Cancer Hospital, Charles Clifford Dental Hospital, and Royal Hallamshire Hospital. The organization is also highly indulged in medical research and innovation. Along with it, the trust is also contributing to the local communities and forming partnerships with neighbouring NHS organizations and charitable trusts.
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SWOT of Sheffield Teaching Hospital
Just by making use of the SWOT tool, the hospital can be able to understand its strengths, opportunities, weaknesses, and potential threats. This might be very useful in mg the strategies for growth. The SWOT analysis of NHS is done below:-
Strengths
Sheffield Teaching Hospital NHS FT has a high reputation in the market due to high-quality healthcare services, trust, and goodwill.
In addition to this, it has a stable clinical leadership model across the organization and can be further modified as per the requirement (Sheffield Teaching Hospitals, 2015).
Also, the organization has a loyal, committed, and engaged workforce with high ethics and moral values.
It is also appreciated for its consistent delivery of research quality and performance
Well-developed organizational governance system and mechanism keeps its brand image intact in the market
Also, the organization has world-class research and development infrastructure that makes it one of the top choices in the list of a healthcare organization
The associated hospitals and educational institute are adding more value to the organization both in financial and non-financial terms.
The organization has regular monitoring of the performance of all levels of staff and controlling and regular suggestions are provided to them along with proper training (Sheffield Teaching Hospitals, 2015).
Weaknesses
Coming on to the weakness of Sheffield Teaching Hospital NHS FT, it is the busiest healthcare provider in the city. Therefore, it has very high bed occupancy and the emergency cases are also increasing that has created a massive shortage in both medical experts and facilities in the past few years (Sheffield Teaching Hospitals, 2015)
In addition to this, the organization's agency staffing cost is quite high in comparison to peers.
Also, due to preference to locals in the job, the workforce recruitment and retaining issues are high and are affecting the organization severely.
Community facilities that are not owned by the organization hamper the service quality and this is one of the weaknesses that affect the organisation's image.
The organization has a high fiscal deficit that is required to be addressed and resolved as soon as possible
The ratio of elective activity to non-elective activity is too low.
At last, the outpatient system, environment, and processes need improvisation (Sheffield Teaching Hospitals, 2015).
Opportunities
Coming on to the opportunities available for Sheffield Teaching Hospital NHS FT, there are numerous areas at which the organization can work effectively. These are:-
Developing integrated pathways with health communities in the locality in order to meet the rising demand for services and improving the existing model of healthcare (Zoominfo, 2020).
The organization can also develop core strengths by expanding services to special healthcare service requirement, such as heart speciality, elderly care, etc.
System-wide transformation plan and sustainability can help in improving lacunas in the current operations
Joining hands with private sector organization and other NHS organizations to generate income and improve services.
Moreover, it can also think about increasing public involvement, service users, and carer.
Improving reputation through referrers, public, and stakeholders can also work for the organization.
The organization can also work on increasing elective referrals to increase the ratio of elective activity to non-elective activity is too low.
Threats
The threats can never be controlled in a business environment but they can be managed. However, these are required to be determined effectively. The potential threats of the organisation are given below:-
The financial factors, such as continuously changing economy, downfall in the average income of people in the UK, and rapidly changing funding models are primary threats (Zoominfo, 2020).
Non-delivery of the emergency activities can affect the brand image are also a threat
Changing of ownership structure for NHS property can drive the cost of operation and staffing for the organization.
Loss of market due to rising private healthcare service providers in the city.
Reducing the number of services due to high redundancy.
Analysis of the Strategic Position of Sheffield Teaching Hospital NHS FT
The latest available financial statement of the Sheffield teaching hospitals NHS foundation:
The financial statements mainly include the statement of income, balance sheet and cash flow statement that is provided for the latest the available year 2019 (Sheffield Teaching Hospitals, 2019).
Ratio Analysis of Sheffield teaching hospitals NHS foundation:
Ratio analysis has been performed for identifying and evaluating the performance, liquidity, profitability of the trust using the formulas mentioned in the table.
Statement of Ratio analysis:
RATIO
FORMULA
2019
2018
2017
2016
2015
Liquidity Ratio:
Current Ratio
Current assets/ current liabilities
1.40
1.23
1.25
1.13
1.28
Quick Ratio
Quick assets/ current liabilities
1.29
1.11
1.12
1.00
1.16
Operating cash flow ratio
Cash flow from operations/ Current liabilities
0.44
0.49
0.22
0.40
0.42
Profitability Ratio:
Return on Equity
Earnings available to ESH/ Shareholder's fund
0.23%
-3.08%
1.68%
-1.56%
3.94%
Gross profit margin
Gross profit/ Sales
0.51%
0.43%
1.77%
0.52%
2.14%
Net Profit Ratio
Net profit/ Sales
0.08%
-1.18%
0.68%
-0.65%
2.14%
Solvency Ratio:
Debt Equity Ratio
Total debts/ Shareholder's fund
0.10
0.11
0.11
0.11
0.12
Interest Coverage Ratio
EBIT/ Interest expense
0.51
0.35
1.41
0.40
1.65
Operating Efficiency Ratio:
Fixed Asset Turnover Ratio
Net Sales/ Avg. Fixed assets
2.71
2.46
2.37
2.26
2.28
Inventory Turnover Ratio
COGS/ Avg. Inventory
83.72
77.12
68.12
66.64
72.04
Receivable Turnover Ratio
Net Credit Sales/ Avg. Inventory
84.15
77.45
69.34
66.99
73.62
The liquidity ratio of the trust has defined that the organization has sufficient liquidity to cover its current obligations and it has been improved from 2015 to 2019 (Sheffield Teaching Hospitals, 2015). The profitability ratio of the organization is low because the trust has the motive of serving people and not making profits because of which it is exempted from the corporate tax and several VAT taxes. The solvency ratio depicts that the organization is mainly driven through the funds of its trustees or equity shareholders who invest in the trust for the betterment of the society and induction high medical services in the region (Sheffield Teaching Hospitals, 2019). The operating efficiency of the organization is good as analyzed from the ratio and reports of the entity.
Peer analysis of major competitors Sheffield teaching hospitals NHS foundation:
Sheffield teaching hospitals NHS foundation trust is the leading service provider of trust in the UK. It has several competitors who also aim similar goals as the organization. Comparative analysis between peers is among the most commonly used and agreed equity analytics approaches used by qualified analysts and investors (Zoominfo, 2020). When companies share similar characteristics in a group of peers including such market or size, it is used to assess relative value. The major competitors of the hospital are Derby Hospitals NHS Foundation Trust with a revenue of $126 million and The Rotherham NHS Foundation Trust which employees about 4977 individuals. They have been considered as the major competitors as they arrive from the NHS foundation trust and the Sheffield teaching hospital also operates under the same. The peer analysis of the hospitals defines the leading position of the organization at present. But the changing environment of the organizations and development of the technologies has threatened the position stability of any entity. The hospital has reported a loss in the year 2018 but has overcome that in 2019 with the reports of profit. The updating technologies have made the competitors excel and achieve better results than Sheffield (Zoominfo, 2020). For maintenance of the position and in the industry the organization needs to develop its staff and high-tech equipment. The funds will be supplied to the organization that proves its worth to the equity holders and develop a sense of social responsibility while balancing the cost and revenues. Hence, the peer analysis guides the Sheffield to develop its resources and maintain its costs with its revenue.
Evaluation of the strategic position of Sheffield teaching hospitals NHS foundation:
The Sheffield Teaching Hospitals is one of the biggest, most active and most effective NHS foundation trusts in the UK that covers Royal Hallamshire Hospital. For Sheffield residents as well as medical care for other individuals, it has a wide array of medical and healthcare facilities. In 2016-2017 the annual sales amounted to £ 1 billion, it had about 16,500 staff and over 290,000 stationary episodes and case-days throughout the year, with over two million patient interactions taken in tandem with outpatient appointments (Sheffield Teaching Hospitals, 2017). It has a very good record of achieving in compliance with national standards, our contractual specifications and the rigorous internal goals that the Board of Directors sets each year. Over the past two years, the Trust has faced major challenges in the continuous fulfilment of regulatory requirements, in response to operational demands and in the continuous provision of high - quality patient care. These difficulties co-exist with the rest of the NHS, and while in the past growth, the trust has been able to meet its efficiency needs through additional revenue generation, now our emphasis is on quality and cutting the cost structure.
The financial projections demand a sound financial situation and any failure to achieve these effects will influence the Trust's capital available resource mobilization. For over 10 years the trust has an enterprise effectiveness program and is still driving productivity and savings in productivity. By introducing the Making It Better Program, the Trust has revised its internal performance and job shaping frameworks in 2016, organizing research on preserving the economic position and improving quality in an increasingly diverse world (Sheffield Teaching Hospitals, 2017). The goal of the program is to incorporate efficiency, finance, and culture work on the Trust. The response to the Carter study and the possibilities available in medical, clinical, ambulatory, staff, corporate and commercial areas are included in this plan. The trust enjoys a satisfactory strategic position however measures have been taken by the trust such as “make a difference strategy” introduction to improve its strategic position (Sheffield Teaching Hospitals, 2019).
Strategic Management planning of Sheffield teaching hospital
Sheffield group of institutes and healthcare has the mission of improving the healthcare and wellbeing of the people. To provide mental and physical wellness, along with the vision to be recognized as the best healthcare provider, educator, and clinical research. The core value includes patient-centric, respectful, unity in working, ownership, and delivering the best and effective services (Sheffield Teaching Hospitals, 2015). The mission and vision can only be achieved with strategic planning, organized with a complete analysis of the internal and external environment. There are various types and levels of strategy applied in the trust to provide the best healthcare and education services. Some of the current changes in strategic management are discussed below (Kwon et al, 2016).
Emerging Technology propagation: the use of technology is growing in any business and it is a challenge for the manager to equip the technology in the strategic management process. In the environment where competitors are adapting with the technology, it is extremely important to adopt the right technology at the right time to avoid any downfall of the business operations (Naranjo-Gil, et al., 2016). The technology must be adopted in almost all the operations of Sheffield to grow in the market such as removing the traditional equipment in the clinical research, using digital classes to connect with the students for the theory classes, using digital notes to save the environment, etc.
Environmental controls: The growing awareness for safety and preserving nature is a major challenge to the managers because now the safety of the environment is social to which the company must contribute. There are certain costs than not included in the strategic planning of cost and expenditures that can cause an increase in hidden charges (Swanson, 2014). The cost of causing any degradation to the environment, water, or air, delivery cost of products in the local region, or international includes the environmental regulation cost of the other country. These costs are generally excluded in the strategic planning in the traditional method and it must be included to have the entire idea of the expenditure and revenue. Compliance costs must be included while planning and execution of any organizational plan as these costs will proliferate in the business.
Time to Market: it is the adoption of all the recent trends in the business as per the market requirements. The organization that adopts the recent trends quickly in the business is more likely to be at a superior position in the market and gain a competitive advantage. Time to market is not merely introducing the product and service on time in the market, it is related tothe branding of the product, company image, customer satisfaction, and several other concerns of the business (Swanson, 2014). The former two points laid above are related to this one, as adopting the technology and environmental control with time is a competitive advantage to the organization. Technology and environmental must be linked with strategic planning as it has direct links with the integration, supply chain, operations, communication, etc.
Workplace environment: all the organization works for continuous growth and improvement in the business with more customer satisfaction, increased demand, and supply of the service, better revenue, achievement of benchmarks in the business, etc. These achievements are highly dependent on the workplace environment of an organization as the human resource is the most important asset of the organization and affects the other factors of growth positively and negatively (Cooke and Bartram, 2015). The organization must be appropriate so that the talent is acquired and retained with the minimum employee turnover. The prime objective of the organization must be to develop a collaborative social environment. The power decentralization is adopted by most of the organization to have timely decisions, encourage the creatives ideas, and boost employee's morale. Communication plays a very important role in strategic planning to deploy the information and changes required in the business to achieve the goals of the organization.
The trends in the strategic management will have an impact on the future strategic planning of Sheffield teaching hospital in the following ways (Naranjo-Gil et al, 2016):
The strategic planning will include all the hidden costs that are usually ignored by the managers such as the cost of causing any degradation to the environment through clinical research improper discharge that fouls the air and water. Policies formation for environmental control and waste disposal.
Adopting the technology in teaching as well as the medical care, the involvement of technical tools such as classroom apps, google glass, cost calculation of adopting technology must be included in the strategic planning while evaluating the environmental changes (Kash and Deshmukh, 2013).
The social environment in the organization must be taken care of, the employee turnover reducing strategies will be included in the future.
Planning to adapt compute assisted learning in the medical processes for interactive lessons for the students.
Resource allocation and appropriate funding will be affected to forecast the proliferation effects of technology, environmental control, and social work environment.
Implementation of strategies to evaluate the risk of investments in several projects. Applying business analytics to the organizational records to forecast the methods of avoiding future failures.
Increasing the strategic partnership for reducing competition in the market and provide the best services by collaboration with the competitors, such strategies of reducing competition must be evaluated for the growth.
Along with adapting to technology the data accessibility and security will also be a concern for the strategic planners as the growing data-theft that might affect the patients are dangerous and suitable encryption and data safety plans must be executed.
Adapting to the recent trend such as cost transparency on social will give a competitive advantage to the firm by achieving customer satisfaction, loyalty, etc.
Impact of Contemporary Strategic Perspective on Future Strategy of the Organisation
The current strategic management perspective focuses on reviewing and reassessing the outcomes of the strategic decisions on the success of the business organization. The culture of strategic management is primarily founded on the principles of strategic thinking. It helps in formulating, deployment, and planning the business strategy. According to Cooke et al (2015), a business organization can be very much benefitted by the strategic thinking approach as it helps the business in many ways. The impacts are discussed in the context of Sheffield Teaching Hospital NHS FT:-
Formulating Strategy to Gain Competitive Edge
The contemporary strategic thinking is assisting businesses in keeping all the resources ofSheffield Teaching Hospital NHS FT fully functional and efficient. This helps in getting valuable insight into the current trend in the market, stakeholders' expectation as well as on the service offerings. This might have a direct impact on the business bottom line. The company can be able to improve its competitive position in the market just by being strategically stable.
Makes the Organisation a more Proactive
Sheffield Teaching Hospital NHS FT can be able to foresee its future with the help of a well-functioning and rationally correct strategic business planning in the contemporary era. The management can be able to anticipate any unwanted and troublemaking scenarios or factor in advance and take necessary measure to curb its impact over the organization. This is usually termed as a proactive approach to cater to the changing scenarios. Being proactive can help Sheffield Teaching Hospital NHS FT to keep its strategies updated as per the ever-changing business trends in the market and stay up in the competition.
Provide a Long-term Direction to Business
It has been noticed that the strategic plan assists in defining the business direction wherein the organization must move on and establish some of its realistic objectives. These have to be in line with the Sheffield Teaching Hospital NHS FT's mission and vision (Hunzeker& Harkness, 2014). In addition to this, it is also noticed that a strategic plan offers a much-required basis to the organization to grow, compensate healthcare workers, and evaluate its overall success. In addition to this, it can also define boundaries for effective decision-making for the organization (Kopnina, 2017)
Improves Operational Efficiency
With the contemporary strategic approach, the business leaders of the Sheffield Teaching Hospital NHS FT can be able to increase operational efficiency. With the rightly prepared strategic plan, the business leaders can be able to set the roadmap that aligns the organizational processes and activities to accomplish goals. It guides the management decision-making process in determining resources and preparing budgets to fulfil organizational objectives, thereby increasing operational efficiency (Kopnina, 2017)
Makes the Organisation a bit More Durable
Sheffield Teaching Hospital NHS FT is a having regular hiccups in the financial performance. Also, it is having a large financial deficit in the present time. However, Kwon et al (2016) believe that organizations can increase their financial durability by making strategic plans. It can provide a strong foundation, direction, and foresight to overcome any market issue or troubles. Moreover, the organization can be able to manage its operating and performance and track the progress and report directly to the key stakeholders. All these have direct impacts over business durability.
Critical Reflection on the Learning from the Module
Talking about the learning from the module and assessments done by me, I can say that I have learned a lot about the concept that is quintessential for me in the present as well as in the future. As I am aspiring to be a manager of a well-known organization, the knowledge of the strategic business decision-making and tools or theories that are relevant for doing so is quite important for me. Starting up with the very basics of the business strategic decision-making, I got to learn about the environment of any organization. I learned that there two types of the business environment, namely internal and external. Both of these environment types are crucial for the business.
The internal environment of the business comprises factors such as organizational competencies, strengths, resources, and strategic capabilities. In addition to this, the stakeholder, their importance, and their analysis was also covered in the module. I learned that to understand the organization's functioning, it is important for the manager to study the value chain. There are tools, such as Porter's value chain model used by a business leader to do so. Furthermore, I got to learn that SWOT analysis is the primary instrument used by the business leader in studying the internal environmental factors, such as strengths and weakness along with potential opportunities and threats. In addition to this, it has been seen that organizational culture also plays a part in the strategic decision-making which has to be studied and managed by the manager (Benito-Ostolaza et al., 2014). Understanding of the culture helps business leaders in giving valuable strategies that suit the organizational culture and employees' working style. Any change in the business environment or the introduction of a new policy always face resistance from employees if it hampers their working style. Hence, I learned that business strategy must be formulated in accordance with the business culture (Swanson, 2014).
Talking about the external business environment, I got to learn that business gets affected by factors, such as economic, political, social, legal, environmental, and technological. In addition to this, the role of supplier, buyers, competitors, substitute, and new entrant also has a certain drastic impact on the business strategy. Therefore, the knowledge of Porter's five force model, generic strategies, and PESTLE is of great importance for a leader. It has been noticed that competitor analysis is useful in forming business strategies (Kash& Deshmukh, 2013). The strength and weaknesses of a competitor in the business area need to be evaluated and strategies are required to form in order to strengthen one's position in the market. In this assessment, I have made an attempt to carry out an analysis of the businesses competing against the organization chosen by me. Based on this, I made an attempt to provide certain strategic recommendations in my work.
Overall, it was a learning module for me and concepts learned through it can be very useful for me in the future. I will be applying this knowledge in the professional experience and ace my field. Also, I can say that tools like PESTLE, SWOT, Porter's Value Chain, Ansoff, and Porter's Generic Strategy model should be used continuously in business to provide direction to the organization. The knowledge would hone my managerial capabilities for sure. These would help me in giving valuable suggestions to the think tank which would ultimately help me in gaining promotions and powers within the organization. Apart from this, I referred to some research papers available online to understand the advantages and disadvantages of each tool or model discussed in this section.
Reference:
Benito-Ostolaza, J. M., & Sanchis-Llopis, J. A. (2014). Training strategic thinking: experimental evidence. Journal of Business Research, 67(5), 785–789. https://doi.org/10.1016/j.jbusres.2013.11.045
Cooke, F. L., & Bartram, T. (2015). Guest editors' introduction: human resource management in health care and elderly care: current challenges and toward a research agenda. Human Resource Management, 54(5), 711–735. https://doi.org/10.1002/hrm.21742
Hunzeker, M. A., & Harkness, K. A. (2014). The strategy project: teaching strategic thinking through crisis simulation. Ps - Political Science and Politics, 47(2), 513–517. https://doi.org/10.1017/S104909651400047X
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Kash, B. A., & Deshmukh, A. A. (2013). Developing a strategic marketing plan for physical and occupational therapy services: a collaborative project between a critical access hospital and a graduate program in health care management. Health Marketing Quarterly, 30(3), 263–80. https://doi.org/10.1080/07359683.2013.814507
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Kwon, I.-W. G., Kim, S.-H., & Martin, D. G. (2016). Healthcare supply chain management; strategic areas for quality and financial improvement. Technological Forecasting & Social Change, 113, 422–428. https://doi.org/10.1016/j.techfore.2016.07.014
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Sheffield Teaching Hospitals, (2019). Annual report. Available online at: https://www.sth.nhs.uk/clientfiles/File/STHNHSFT%201819%20Annual%20Report%20and%20Accounts.pdf [Accessed on 22 May 2020]
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