Shouldice Hospital

Group 02
Joshua Carbone
Maru Desta
Anshul Khare
Kevin Perry
Abdullah Siddiqui

OPRE 6302.0W1 Operations Management

Prof. Milind Dawande

The University of Texas at Dallas

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Shouldice Hospital provides specialized, high quality surgical care as a service to patients
suffering from external abdominal hernias. In order to evaluate the hospitals efficiency and
potentially improve the business, the process of providing patient care must be analyzed in
terms of the five characteristics of business processes.
First one needs to determine the inputs and outputs of the process. At
Shouldice, the primary inputs are patients experiencing symptoms of external abdominal hernia.
Other items, such as medical supplies, food for the patients, and electricity for the machines
are also important inputs to the process which must be in place for the system to work. The
primary outputs of the Shouldice process are successfully treated patients. Medical waste is an
important byproduct that must be disposed of according to local environmental and public
health laws.
Second, one needs to determine the flow unit of the business process. The flow unit at
Shouldice is the individual patient.
Third, the process must be analyzed and broken down into a network of activities and
buffers. Activities at Shouldice include screening and diagnosing patients, checking patients in
for surgery, pre-surgical counseling/orientation, administering medications, performing surgery,
patient exercise, and others. Buffers exist wherever there is a need to delay patient movement
through the system between activities. This may take the form of a waiting room, having the
patient stay overnight, the pe-operating room, or other such tools. A flowchart outlining the
process at Shouldice is found in Appendix A.

The fourth element of the process view involves the resources used by the business.
Resources are usually divided into two categories, capital and labor. The land, building, medical
equipment, surgical tools, and computers are all examples of capital resources at the hospital.
Surgeons, nurses, support and administrative staff are the labor resources used at Shouldice.
Finally, the information structure of the process describes what information is needed
by whom at each step of the process. One excellent example of this is the need of the surgeon
to have access to the patients medical history and vital signs before, during, and after surgery.
Such information is crucial for making good decisions for managing patient care. Another
example is the patients need for information about the procedure, with descriptions of what
will happen and details of how to properly prepare for surgery.
Competitive Priorities
The hospital operates with an average backlog of 1200 patients waiting for surgery and
as such competition from rivals is not an issue at least for the short term. However, as could
be seen from Exhibit 4 in the case report, other clinics and hospitals are trying to emulate the
them and Shouldice has to expand its capacity to serve these patients waiting in line before
losing them to its potential competitors.
Market Focus
Shouldice Hospital has chosen to focus upon a particular kind of ailment only. It has
limited its focus to treating external abdominal hernias only. It does not take up cases of
internal or other types of hernias.

There is a large market for such type of operations, 600,000 per year in the US alone in
1979. Current estimates for all hernia operations are around 20 million per year worldwide(1).
Patients should not be overweight and be in good general health, no heart conditions
etc. This gives them a much higher chance of success and low complication rate, keeping costs
low.
They are able to do screening for remote patients as well through mail diagnosis, thus
increasing their target market.
Their costs are quite low and attractive, coming out to about 50% the cost of traditional
hospitals, as a result they were able to attract international clients who could save money even
when travel costs were factored in.
Operations Strategy
The business strategy that guides Shouldice Hospital is early ambulation following
surgery.
The operations strategy that supports this business strategy defines internal processes
not just from a patient and medical staff perspective but also that of its facility. All these
processes are interconnected and rely and build on each other leading to a competitive
advantage that is more sustainable.
Narrowing of focus to a particular surgical procedure that allows for early ambulation.
Use of local anesthetic plus pain killer to facilitate ambulation and faster recovery.

 Design of the facility to encourage patients to get up and walk around by removing the
phone and tv from the patients room.
Pre-screening to select patients likely to have successful procedures based on weight
and other health factors.
Making the patients stay more comfortable by giving a non-hospital look and feel as
much as possible, example use of carpeting to provide more comfort and give a
different smell than usual.
Encouraging social involvement among doctors/nurses and patients to ease their stress
and worries.
Careful selection of doctors to make sure they would be following the established
procedures to ensure success.
Encouraging collaboration and seeking of guidance among doctors leading to more
successful procedures
Ensure high employee satisfaction and thus better performance by giving them a share
of profits
Discuss its strategic fit
Shouldice hospitals Strategy is achieving early ambulation following surgery by using local
anesthetic , applying a procedure that puts no tension on the natural tissues and by designing
a facility that encourages movement without unnecessarily causing discomfort to the patient.
This technique has made the services available at an affordable price of $450 to $525 per
patient to those in need of the service . It would cost $2,000 to $,4,000. in traditional
hospitals for the same services. As Dr. Byrnes Shouldice said, he is a doctor first before he is
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an entrepreneur focusing more on providing the services than maximizing profits and as such
the hospital's operational and business strategy are in alignment.

Appendix A
Shouldice Hospital Process Flow

Appendix A

References
1. http://surgery.med.nyu.edu/general/patient-care/hernias/overview-hernias