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From inspiration to imagination at work, GE has been at the forefront of innovation. With newer opportunities and ever-increasing challenges, GE works on things that matter! Heres your opportunity to try and solve one of Indias toughest healthcare challenges and showcase your genius!
PREFACE
Ravi and his wife Sapna reside in a village in one of the districts of Karnataka, India. The couple is expecting their first child and wants to ensure a safe maternity. They are also wary about any complications that might arise during the delivery. The clinic nearby caters to the basic healthcare needs of the town. But complicated cases are referred to the hospital in Mangalore which is 160 kms away. This has been a concern for the local population. The cost of treatment in the city hospitals is another challenge as patients and their families have to arrange for finances and be prepared for the hospitalization costs. Dr. Waghe from the Government Hospital at Mangalore shares similar concerns. Expecting mothers who arrive at our hospital at late stage of their pregnancy are sometimes diagnosed with complications which are difficult to address. There are certain cases where infants are referred to us by doctors of near-by villages due to lack of adequate healthcare facilities and infrastructure in their villages. But at times they arrive too late for us to help them out in anyway. A skewed distribution of medical facilities between urban and rural India has resulted in limited access to quality and specialized medical care services to the rural population. Research has pointed out that only three out of ten people ultimately get treated in tier 3 and other small towns. This reflects a huge potential for infrastructural investment in these markets and a gap for healthcare delivery that needs to be plugged. For GE Healthcare, the backbone of the In Country for Country model (products for local customers and local environments) rests on tier 3, 4 and 5 towns - these are markets with huge potential for hospitals/healthcare services and where GE would like to grow its footprint, with a special focus on the Maternal and Infant Care segment.
Industry bodies have been lobbying for the healthcare sector to be given infrastructure status and associated tax benefits that will trigger investments in hospitals. If this demand is accepted, it would give an additional fillip to the healthcare industry in India However, there are some alarming statistics to be shared here. With 20 per cent of the world's disease burden, we have only 6 per cent of the world's hospital beds. Hospital beds per 1000 population in India is less than 50 per cent of that in other emerging markets like Brazil and China and less than 35 per cent of the world average. Even the infrastructure that exists is highly fragmented and disproportionately distributed. It is dominated by public healthcare facilities which have 62 per cent of the beds while private players account for the remaining 38 per cent. The healthcare insurance industry has witnessed growth in the recent years. However, not to the level expected, considering 64 per cent of the healthcare expenditure in India is out-of the patients pocket. Despite these barriers and challenges, improved quality of care which is both accessible and affordable is a felt need across tiers of healthcare facilities.
Additionally, the customers in the tier 3/4/5 markets are neither trained nor skilled enough to use the equipment. Furthermore, in case of any service issues with the equipment, both GE personnel and external engineers are not readily available to service these markets. The ability to use GE equipment is critical for winning in this market and depends on the following parameters: Ease of use Minimal training on equipment (intuitive to use) Parts & Service Delivery Maintenance (regular maintenance and replacement of parts) Logistics to serve the population in tier 3/4/5 towns
GOVERNMENT INITIATIVE
A number of steps are being taken by the Government to ensure that quality care at affordable cost reaches the masses in the smaller towns of India. One such initiative is the Janani Suraksha Yojna aimed at reducing maternal and infant mortality rates and increasing institutional deliveries in below poverty line (BPL) families. The government offers cash-assistance to expecting mothers so that their deliveries happen in institutions (private/government centres/nursing homes). Before this scheme 45 per cent births occurred in homes with poor health and hygiene conditions. With the successful launch of the Scheme, this figure has reduced to 35 per cent resulting in approximately. 2.6 million additional births through institutional delivery. This has led to an increase in demand for care where more consumers are reaching out to private setups apart from the govt. established facilities. However, the current market is unable to meet the requirements of this surge in demand due to inadequate infrastructure and lack of trained/skilled manpower.
TARGET GROUP
For the purpose of this case, the focus is on the private small-town mom & pop clinics in tier 3/4/5 towns.
GEs CHALLENGE
Given the current demand of this market and the alignment of GEs low cost product solution to tier 3 and below markets, these products should ideally be a running success in these mom & pop clinics. GE expects the demand for the products to be in tens of thousands, however till date it has only served a few thousands, due to constraints in reaching the market. The challenge for GE is to reach out to these untapped markets and drive usage of their equipment in mom & pop clinics. With its designed for India products that are affordable and reliable, GE is on the look-out for solutions that can drive high volumes of these products in these markets. The challenge exists in shortage of trained manpower that can service or fix the equipment in remote locations. The ability to implement a business model with the right channel partners for such extensive services all over the country and proper governance is another challenge. The options for GE are to either go to this market on its own or come up with a strategy by partnering and sharing channels with other healthcare/service providers. In the current scenario, 90 per cent of GE sales happen through its direct sales force. The GE sales force structure for the Maternal & Infant Care segment is represented alongside. Product Sales Specialists are domain experts and handle sales for the Maternal & Infant Care Segment. Specialists handle sales for all products under the Life Care Solutions segment (Maternal & Infant Care is part of this segment). Generalists handle sales for the entire product portfolio of GE Healthcare (including all segments). The remaining 10 per cent of GE sales is through a dealer or distributor network (approximately 40 dealers or distributors located in big cities). The GE empanelled dealers in turn create sub-dealers to enable sales. These multiple layers end up adding cost to the structure (typically a double mark-up), which in turn increases the cost for the customer. In order to be empanelled as a GE dealer /distributor, a vendor must meet rigorous business/financial criteria. This poses a big challenge for GE towards creating a large dealer network across Tier 3/4/5 towns.
YOUR CHALLENGE
Design an overarching strategy for GE to succeed in delivering healthcare equipment and support services in tier 3, 4 and 5 towns. While doing so provide particular emphasis on the aspects detailed below: a. Provide solutions for GE to reach the customer in the specified markets along with a map of the appropriate channel structure. The proposed solution should not have too many layers of distribution channels to ensure that the cost of the product remains low. b. Draw a plan of action for GE to fulfil the training and awareness needs of the customer. Explore avenues that will help the customer self-maintain the product (troubleshoot, part replacement, clean, upkeep etc.) thereby providing a sustained model of delivery of healthcare support solutions. c. GE has a strong compliance policy when it comes to selection of partners or dealers. Draw best practices from existing B2B/B2C MNCs to develop a strategy for selection of channel partners in this market without it being a deterrent to the business. Teams are advised to highlight some of the best practices followed by B2B/B2C MNCs in this market segment and propose a benchmark for GE. For the purpose of the case, you could consider the following as a definition of the tiers: Tier 3 4-8 lac population Tier 4 1-4 lac population Tier 5 Less than 1 lac population
Also, a visit to a private clinic or a primary health centre in a sub 1 lac population town is recommended for understanding the challenges on the ground.
GE CURRENT SCENARIO
GE Present Tier 1, 2 Large equipment e.g. CT/MR etc. Delicate, High end equipment High price + Sophisticated Low volume products predominantly Trained & skilled manpower and customers Service delivered through GE personnel and staff recruited and trained by GE & customers GE Future (requirements) Tier 3, 4, 5 Smaller equipment that meets needs of these markets e.g. LED PT, Lullaby Warmers, ECG etc. Robust, reliable, rugged Low price + Price sensitive Need higher volumes for the same level of revenue Need to train customers to build skillset and expertise (both technical & clinical) Neither GE nor trained staff present currently for service or maintenance needs; need to address the gap
Challenges
High capital costs: Depending on the region and real estate costs, an average hospital requires a capital infusion of Rs 40 lakhs to 1 crore per bed. Land and building account for almost 40 per cent of the total project cost and affects the viability depending on the resulting per bed cost. Medical equipment: About 40 per cent of the costs in a tertiary setup are taken up by medical equipment (cutting edge technology at the time of purchase). This becomes obsolete within 5-7 years of the setup. This is even more challenging as majority of equipment is imported and very few local reputed manufacturers exist. This will lead to higher treatment costs and low utilization rates resulting in undesired operating margins.
Please note that the contents of the case have been created jointly by GE India and the Industry Institute Partnership Cell, NMIMS Mumbai.
Registered teams are expected to work on the Case Study shared by GE and present the analysis/recommendation in the form of a power point presentation, not exceeding 11 slides (including one cover slide) Each team is allowed to submit only 1 entry at the end of the challenge. In case of multiple entries from the same team, we will consider only the first (earliest) entry for evaluation Participating teams are required to send in their entry in the form of a pdf file (ppt converted to pdf) over email to genius@ge.com The name of the pdf file and the email subject line must be Genius2012_InstituteNameCode_TeamName All entries must be submitted by Sunday, October 21, 2012 11:59 pm Any team submissions made beyond the stipulated timelines or in any other format will not be considered for evaluation Our mailbox may receive high traffic close to the deadline. Hence, we request the teams to send across their entries well in advance All teams which have successfully submitted their entries within the stipulated time will receive an acknowledgement of receipt within 2 working days
EVALUATION PROCESS
Each entry will be carefully evaluated by a panel of senior leaders from GE The analysis should be presented in a way that it solves all objectives in the best possible way We encourage teams to visit a nearby village or Tier 3/4/5 town to understand the case in depth The panel will shortlist the Top 5 teams for the Grand Finale based on the following criteria: Strategic Focus Depth of analysis Originality, Innovation and Imagination Ease of Implementation of the solution Understanding of the challenge in a holistic way Quality of presentation
GRAND FINALE
All members from the Top 5 teams will be invited to attend the Grand Finale in person at Mumbai. Details on the pre-work and other requirements for the Grand Finale will be shared with the shortlisted teams accordingly The Grand Finale will be hosted at Mumbai on Thursday, November 8, 2012 The Jury for the Grand Finale will consist of senior leaders from GE and senior faculty members from reputed B-Schools All costs pertaining to travel of the shortlisted teams to Mumbai, boarding/lodging, as well as return to the campus will be borne by GE The decision of the Judges pertaining to Genius will be final and binding
PRIZES
The Winning Team shall receive a cash prize of INR 1,50,000. The runners-up team shall receive a cash prize of INR 75,000. All members of the Top 5 teams will be felicitated by personalized certificates of achievement. The Winning Team members will be given an opportunity to get mentored by senior leaders from GE. The Winning Team members shall be eligible for a Pre-Placement Interview (PPI) for the Entry-level GE Leadership Programs, basis eligibility criteria and Jury discretion.