A study on Analysis of operational strategies employed in Hospital Industry (Apollo and Manipal Hospitals)

1. 205-OPERATIONS MANAGEMENT
MINI – PROJECT REPORT ON
A study on Analysis of operations strategies employed in Hospital
Industry (Apollo and Manipal Hospitals)
Submitted By: SECTION-A, TEAM - 7
S. No. REG. NO. NAME OF THE STUDENT COURSE
1 121724601004 Bala Sai.V MBA(IB)
2 121724601016
Gedda Sai Kumar
MBA(IB)
3 121724601030
Kashyap. P
MBA(IB)
4 121724701005
Kritika.S
MBA(IBF)
5 121724601039
Sravan.k
MBA(IBF)
In Partial Fulfilment of Requirement for the Award of the Marks towards MINI -
PROJECT as part of 205-OPERATIONS MANAGEMENT Course in Master of Business
Administration (IB/IBF/GSCM)
Under the Guidance of
Dr.CH. VENKATAIAH
Professor (Operations, Quality & Project Management)
GITAM School of International Business, GITAM University, Visakhapatnam
Andhra Pradesh, India-530045
GITAM School of International Business
GITAM University
Visakhapatnam-45

2. ACKNOWLEDGEMENT
We express our sincere gratitude to Dr.CH. VENKATAIAH Professor of GSIB for his
consistent guidance and valuable feedback on our project work: A study on Analysis of
operations strategies employed in Hospital Industry (Apollo and Manipal Hospitals).
This particular project helped us to gain a deep understanding on Operations of Hospitals.
The completion of this undertaking would not be possible without your support.

3. DECLARATION
We hereby declare that the project work entitled “A study on Analysis of operations
strategies employed in Hospital Industry (Apollo and Manipal Hospitals)” submitted to
the GITAM School of International Business, GITAM University, Visakhapatnam , is a
record of an original work done by our team under the guidance of Dr.CH. VENKATAIAH
Professor (Operations, Quality & Project Management) GITAM School of International
Business, and this project work is submitted in the partial fulfillment of the requirements for
the award of the degree of Master of Business Administration (IB/IBF/GSCM). The results
embodied in this thesis have not been submitted to any other University or Institute for the
award of any degree or diploma.
Section-A
Team-07
Bala Sai.V- 121724601004
Gedda Sai Kumar- 121724601016
Kashyap. P- 121724601030
Kritika.S- 121724701005
Sravan.k- 121724601039

4. CONTENTS
S.No Content Page No.
1 Introduction 1-1
2 Objectives of the study 2-2
3 Understanding the Competitive Market Dynamics 3-5
4 Top Healthcare Industry Trends in 2017 6-7
5 Identifying Order-Qualifying and Order-Winning Attributes 8
6 Strategies adopted for Competitive Advantage 9
7
Apollo
Matching the strategic options with resources, constraints, values &
objectives to arrive at the overall Corporate Strategy
Developing an Operations Strategy on the basis of the corporate strategy
Selecting appropriate options for configuring an Operations systems &
establishing relevant measures for operational excellence
10-14
8
Manipal
Matching the strategic options with resources, constraints, values &
objectives to arrive at the overall Corporate Strategy
Developing an Operations Strategy on the basis of the corporate strategy
Selecting appropriate options for configuring an Operations systems &
establishing relevant measures for operational excellence
15-17
9 Conclusions 18
10 References 18

5. EXCUTIVE SUMMARY
India is expected to rank amongst the top three healthcare markets in terms of incremental
growth by 2020. In 2015, Indian healthcare sector became the one of the largest employer,
both in terms of direct as well as indirect employment, with expected total direct employment
of 4,713,061 people. Rising income levels, ageing population, growing health awareness and
changing attitude towards preventive healthcare is expected to boost healthcare services
demand in future. The low cost of medical services has resulted in a rise in the country’s
medical tourism, attracting patients from across the world. Moreover, India has emerged as a
hub for R&D activities for international players due to its relatively low cost of clinical
research. With highly Competitive and fastest growing market companies should focus on
Preparing the Growth, Planning the Market Entry, Establishing the Presence, Improving the
Market Position. Apollo and Manipal both being a pioneer in the industry from a long time,
in this report we have study description of their Operational and Corporate Starting with a
varied set of resources. By increasing their operational excellence they are moving cater
grater markers with more efficiency.

6. Page 1 of 18
INTRODUCTION
Healthcare has become one of India’s largest sectors - both in terms of revenue and employment.
Healthcare comprises hospitals, medical devices, clinical trials, outsourcing, telemedicine, medical
tourism, health insurance and medical equipment. The Indian healthcare sector is growing at a
brisk pace due to its strengthening coverage, services and increasing expenditure by public as well
private players.
Indian healthcare delivery system is categorized into two major components - public and private.
The Government, i.e. public healthcare system comprises limited secondary and tertiary care
institutions in key cities and focuses on providing basic healthcare facilities in the form of primary
healthcare centers (PHCs) in rural areas. The private sector provides majority of secondary, tertiary
and quaternary care institutions with a major concentration in metros, tier I and tier II cities.
India's competitive advantage lies in its large pool of well-trained medical professionals. India is
also cost competitive compared to its peers in Asia and Western countries. The cost of surgery in
India is about one-tenth of that in the US or Western Europe.
Indian government has decided to increase its health expenditures to 2.5 % of GDP by the end of
2017. Healthcare sector is expected to reach USD 100 billion by 2017 - this means, annual growth
rate of 20%.The hospital service industry in India is growing very fast with CAGR of 9%. Medical
tourism industry is important revenue source (~20% of revenues) for hospitals – it is worth of $2
billion and growing annually 20%. Three identified growth sectors are oncology, orthopedics and
cardiology 100 per cent FDI is permitted for health and medical services. Reduction of customs
duty for 5-7.5% on all medical, surgical and dental equipment. Private sector accounts for 65% of
the total number of operational beds and over 80% of the healthcare spending. It is expected to
grow 24.1% annually until 2020 - it will contribute 80% of the USD 86 billion healthcare
investment required until 2025. In the private sector supply processes for new procurements are
shorter and more flexible than in the governmental hospitals. Private sector provides special
healthcare services -they have need for specialized technology and services.

7. Page 2 of 18
OBJECTIVES OF STUDY
 Understanding Healthcare sector in India
 Industry Analysis
 Comparing Operations Strategy of Apollo and Manipal Hospital
Apollo Hospitals’ Mission is “to bring healthcare of international standards within the reach of
every individual. They are committed to the achievement and maintenance of excellence in
education, research, and healthcare for the benefit of humanity.”
The focus at Manipal Hospitals is to develop an affordable tertiary care multispecialty healthcare
framework through its entire delivery spectrum and further extend it to homecare. They are
committed to be the most preferred and comprehensive hospital through clinical excellence,
patient’s centricity and ethical practices to meet the health care needs of the community.

8. Page 3 of 18
MARKET DYNAMICS
The healthcare market functions through five segments
Private sector has a strong presence in India’s healthcare sector
The private sector has emerged as a vibrant force in India’s healthcare industry, lending it both
national and international repute. Large investments by private sector players are likely to
contribute significantly to the development of India’s hospital industry, which comprises around
80 per cent of the total market. In India, private healthcare accounts for almost 74 per cent of the
country’s total healthcare expenditure. Private sector’s share in hospitals and hospital beds is
estimated at 74 per cent and 40 per cent, respectively. The main factor contributing to rising
medical tourism in India is presence of a well-educated, English-speaking medical staff in state-
of-the art private hospitals and diagnostic facilities. In January 2016, Government of Odisha laid
the foundation of 100-bed super specialty cardiac care hospital worth USD 11.45 million, to be
built in Jharsuguda, under the public-private partnership mode. For this, the state government
chose CARE hospital, to manage and operate the hospital.

9. Page 4 of 18
Per capita healthcare expenditure has risen at a fast pace
Per capita healthcare expenditure is estimated at a CAGR of 5 per cent during 2008–15 to USD68.6
by 2015. This is due to rising incomes, easier access to high-quality healthcare facilities and
greater awareness of personal health and hygiene. Greater penetration of health insurance aided
the rise in healthcare spending, a trend likely to intensify in the coming decade. Economic
prosperity is driving the improvement in affordability for generic drugs in the market.

10. Page 5 of 18
Key players in the market

11. Page 6 of 18
Top Healthcare Industry Trends in 2017
2017 is poised to be a landmark year for the healthcare industry. Millions of patients will receive
their first online video consultation without having to visit a doctor's premises, while thousands of
others will be able to use their mobile phones as diagnostic tools. The healthcare industry itself
will become more stable and self-sufficient, while incorporating technology into every facet of its
inner-workings and obtaining valuable insight from real-time data analytics.
Healthcare will go Mobile
Mobile health app adoption rates are going through the roof, with more than double the app
downloads as compared to previous years. Today, consumers and patients are not only using their
smartphones and smart watches, amongst other interconnected devices, to monitor their health, but
also to receive expert diagnosis from remote proximities in the comfort of their own homes.
"Bed less hospitals" - however ridiculous they may sound - are actually a thing now, as patients
get treated without ever stepping a foot inside the hospital, and this number is only going to
increase as more than 60% of the people are already willing to try out the latest health and remote
diagnosis apps.
The Cyber security Threat will Loom Large
While technology-adoption is on the rise in the healthcare industry, it is the threat of hacking and
insufficient security measures which is keeping close to 50% of the people from trying out any
connected healthcare device. Imagine the chaos that would be caused when hackers gain the ability
to hack connected medical devices such as insulin pumps and pacemakers!
As a result, in the coming years, we can expect hospital administrations and the healthcare industry
in general to become more proactive when it comes to securing their medical equipment. This in
turn means top-notch network architectural services will have to become a norm rather than an
oddity.

12. Page 7 of 18
Consumer-focused Medical Plans will become a Norm
Medical expenditure is on a rise. As the amount of money being spent to take care of one's health
rises, consumers will start looking at options including trained professionals who could manage
their health spending similar to their retirement plans.
2017 will see a spurt in healthcare providers bundling innovative healthcare finance offerings with
other plans to retain patients, and offer plans akin to air miles and frequent flyer discounts. Such
models will therefore cater to two important consumer needs - convenience and value.
Behavioral Healthcare will See Increased Acceptance
Unfortunate but true, behavioral health is poised to become a major area of concern by 2017. One
out of every 5 Americans experiences a form of mental illness every year. PTSD (Post-traumatic
Stress Disorder) is on the rise amongst soldiers, and various other mental illnesses are gradually
being defined as we hurtle towards a complex future. As behavioral healthcare starts costing the
healthcare industry more than $440 billion annually, 2017 is supposed to be the year when doctors
and physicians sit up to take notice, and address the many issues affecting patients - many of whom
don't even know that they have a mental / behavioral illness.
New Strategies to Deliver Low-cost Healthcare will be on the Rise
The biggest dilemma in front of healthcare providers has always been how to deliver the best
possible results while keeping the prices down. In 2017, mounting budget pressure on hospitals
and clinics will see them reacting positively and coming up with innovative ways to deliver quality
healthcare.
 Some of these methods would include -
 Affiliating with community hospitals
 Building bed less hospitals
 Building virtual care centers
 Partnering with retail clinics

13. Page 8 of 18
IDENTIFYING ORDER-QUALIFYING AND ORDER-WINNING ATTRIBUTES
Sl.No Service attribute Poor
(Terrible)
level
Expected
Level
Realistically
Expectation
level
Classified
As,,
1 Availability Doctor hour Open 9-6
Mon-Sat
Open 24hrs a
day
Qualifier
2 Convenience Far from
target market
Near from
target market
Pick up
Facility
(Ambulance)
Qualifier/Winner
3 Free structure Fee charged
for every
consultancy
Continuous
Consultancies
are
discounted
Free recheck
for particular
ailment
Winner
4 Price 500 300 150 Qualifier
5 Parking Facility No parking Limited Valet Parking Qualifier
6 Courtesy Push as
segment
cartel ( Move
it move it)
Nice as and
Griffith
Personalized
Services
Winner
/Qualifier
7 Cleanliness Unhygienic Industrial
standard
practices
Cleanliness
with
ambiance
Qualifier/
Winner

14. Page 9 of 18
STRATEGIES ADOPTED
Cost leadership
• Private players in the industry are making their supply chain efficient and leveraging economies of
scope to reduce cost. One such example is Narayan Hrudayalaya (NH) where health care is provided
at affordable cost. NH reduces cost by
• High procurement of medical supplies
• High-volume by high capacity utilization and staff productivity
• Good human capital management (i.e. training)
• Leveraging the benefit of Information Technology to reduce cost and improve healthcare delivery
Differentiation
• Players in the industry are trying to differentiate themselves by providing multiple health care
services under one roof. In 2015, Many Hospitals have collaborated with government to provide
healthcare facilities in rural areas
• Players are also trying to provide better services to differentiate themselves
Focus
• Certain players in industry focus only on providing one kind of health care service to its
Customers. This also helps them to be the leader in that service. Many examples can be quoted for
hospitals focusing on treatment of cancer and providing leading cancer treatment and eye related
problems and treatments in India.
Diversified business approach
• Offering a range of healthcare and wellness services under a single brand has become a trend.
Patients and healthcare services seekers find it convenient. Demand of such arrangements boosts the
healthcare sector.
Merger & Acquisitions Global Healthcare companies are aiming to drive growth and diversify
products through mergers and acquisition.

15. Page 10 of 18
APOLLA GROUP COMPANIES
The Apollo Hospitals Group today is not only an acknowledged leader in the world of super-specialty
based quality healthcare delivery in Asia, but is also considered as the largest integrated healthcare
delivery company, complete in every sense of the term.
» Apollo Hospitals Enterprise Limited » AHEL Pharmacies Business
» Keimed.com Limited » Online Hospital Equipment Services
Private Limited (Equipment World)
» Apollo Health & Lifestyle Limited » Apollo Health & Lifestyle Limited
» MedVarsity Online Limited » Apollo Telemedicine Enterprises
Limited
Other Business Units
Apollo Hospitals
Apollo Hospitals Enterprise Limited has over 8065 beds across 46 hospitals in India, rest of Asia
and Africa. The hospitals are multi-specialty tertiary care facilities with centers-of-excellence in
medical disciplines including cardiology, cardio-thoracic surgery, gastroenterology, orthopedics
& joint replacement surgery, neurology, critical care medicine, nephrology, oncology, hand &
micro surgery and reproductive medicine.
Apollo Global Projects Consultancy
Apollo offers project and operations management consultancy services with the support of
operational and functional specialists. The pre & post commissioning consultancy services

16. Page 11 of 18
include feasibility studies, strategic planning, infrastructure consultation, human resource
recruitment, training and medical equipment consultancy, management contracts, establishment
of medical and administrative protocols etc.
Apollo Health and Lifestyle Limited
Apollo Health and Lifestyle Limited, has established over 100 Apollo Clinics across the country,
is an integrated model and offers facilities for specialist consultations, diagnostics, preventive
health checks and 24-hour Pharmacy, all under one roof.
Apollo Pharmacy
Apollo Pharmacy is India's first and largest branded pharmacy network; with over 750 retail
outlets in key locations across the country. The group adds one pharmacy every 23 hours.
Apollo Hospitals Education and ResearchFoundation
AHERF was set up to establish, maintain and support educational institutions in promoting
medical, paramedical and hospital management courses. The Institute offers over 18 post
graduate teaching programmers, including ones certified by the Royal College of Edinburgh.
MedVarsity Online Limited is backed by two giants; Apollo in medicine and NIIT Limited in the
field of electronic-education. MedVarsity has developed in-house, over 1500 hours of medical
content that is accessible to the medical community, anytime and anywhere. The research
division currently undertakes diverse projects from clinical trials in multiple locations to
molecular biology, stem cell transplants, epidemiological studies, and in the future identification
of genetic Biomarkers.
Apollo Telemedicine Networking Foundation
In 1999, Apollo launched its first model Telemedicine Unit at Aragonda village in the Chittoor
district. Since then, Apollo has witnessed a steady growth in terms of delivering quality
healthcare and reaching out to the masses. Telemedicine is a potent means of harnessing
telecommunication technology to deliver healthcare and education to patients in regions that are
geographically less accessible. It also saves time and the cost of travel to access quality care.

17. Page 12 of 18
Apollo has pioneered the concept of telemedicine in India and Asia, and has over 100
telemedicine centers in India and overseas.
Apollo Insurance Company Limited
Apollo DKV is a joint venture of the Apollo Hospitals Group and DKV AG, Europe's largest
private health insurer and a Munich Re Group company. The company offers innovative health
insurance, wellness solutions and disease management to meet customer needs.
Apollo Wellness Plus
Apollo Hospitals launched the first Wellness Centre at Apollo Hospitals Chennai in Feb 2005.
Wellness Plus is the perfect blend of modern and complementary medicine like aromatherapy,
pranic healing, yoga, and meditation that fits the modern lifestyle.
Apollo Reach Hospitals
An endeavor to bring world class healthcare to semi urban and rural India - every Apollo Reach
Hospitals will be a specialty hospital, designed to complement existing private and public
healthcare facilities in the proposed towns and villages. Construction of hospitals, procurement
of land and identification of cities are underway to set up the first phase of 25 Apollo Reach
Hospitals over the next two years across India. With an initial bed strength of 100 - 150 beds,
each Apollo Reach Hospital can be ramped up to a 200 bedded specialty hospital

18. Page 13 of 18
DEVELOPING AN OPERATIONS STRATEGY ON THE BASIS OF THE CORPORATE
STRATEGY
Apollo Hospitals has been a pioneer in adopting cutting edge technology to generate value for its
patients. Apollo Hospitals is one of the first hospital groups to start Tele-consultations in remote
geographies. The Group’s latest offering, Ask Apollo, is a robust clinical delivery engine that can
convert any PC into an Online Hospital. It is a patient-centric service that gives patients the
freedom to login and book online consultations with Apollo Doctors across all specialties and
super specialties through an interactive Website (askapollo.com).
The consultations can be scheduled as a video conference, voice call or over e-mail. The users
have the option to share their medical reports with the doctor for a review before consultation and
can manage all their records online. Ask Apollo comes with Zero setup cost and can be accessed
through any PC around the globe. The Ask Apollo website has a simple user interface making it
easy to navigate. Ask Apollo promotes reduced health costs for an individual without
compromising on the quality of healthcare.
The major components of Ask Apollo’s Digital Strategy
 A responsive platform agnostic, mobile phone optimized offering which lists all services
on the home page without a cluttered appearance.
 Minimal touch points with basic user information to facilitate superior service delivery.
 Deep linking of relevant Webpages to ensure users find what they want on the page they
land on and can easily navigate through the various sections.
 Updated, clinically robust, actionable healthcare content, relevant and helpful to the
consumer.
 Periodic check-up reminders, condition specific healthcare content for condition
management, geography specific health alerts, free condition trackers and information
relating to camps and discounts.
 Within a few months of launch, Ask Apollo has gained traction in terms of user
acceptance in both urban and semi urban markets- a testimony to how the Indian masses

19. Page 14 of 18
are accepting the concept of Tele-consultations. Overseas markets like China, Singapore,
United Kingdom and the Middle East have shown great interest in this concept.
Ask Apollo is a single address for running the following services
 24x7 Family Physician Online consultations
 Apollo Specialty and super specialty
 consultations
 Multispecialty Board consultations
 Online Physical appointment booking
 Health check booking
 Patient health records
 Locating a hospital or clinic
THE APOLLO EXPERTISE
One of the most respected hospitals in the world, Apollo hospitals specializes in cutting-edge
medical procedures. With the evident boom in Medical tourism, we have a lot of health tourists
choosing us as their ultimate Health Tourism destination for medical services. They have
pioneered many revolutionary procedures and technologies in India, and a whole lot of health
tourists come to opting either for medical care or elective procedures. Some of the health
procedures are-
 Cardiac Surgeries Total Knee /Hip Surgery Replacements
 Birmingham Hip Resurfacing Procedure
 Liver, Multi-Organ, and Cord Blood Transplants
 Coronary Angioplasty
 Stereotactic Radiotherapy and Radio surgery
 Cosmetic Surgery
 Bariatric Surgery - laparoscopic
 Laparoscopic Hernia Repair
 Laparoscopic Adrenalectomy

20. Page 15 of 18
MANIPAL HOSPITALS
Manipal Group of Hopitals or Manipal Hospitals is part of Manipal Education and Medical Group
(MEMG) which pioneers in the field of education and health care delivery. Manipal Hospitals are
the India’s third largest health care group with a network of 15 Hospitals at 9 location of 5 States
in South India and two primary clinics. Manipal Hospitals are based on three core values – Clinical
Excellence, Patient Centricity and Ethical Practices.
Manipal Hospitals has the best of technological advancements and the specialized Doctors.
Manipal Hospitals caters to around 2 million customers from India and overseas every year. The
focus at Manipal Hospitals is to develop an affordable tertiary care multispecialty healthcare
framework through its entire delivery spectrum and further extend it to homecare.
Group Companies
Education Onsite campus
Manipal has nine Onsite campuses in Manipal, Mangalore, Bangalore,
Goa, Sikkim, Nepal, Malaysia, UAE, Antigua
Distance education
Manipal Universal Learning is the Group’s endeavor into distance
learning.
Research
Hospitals Manipal Hospitals

21. Page 16 of 18
Challenges
The Manipal Hospitals administration was aware of the challenges which they will face in
transforming the family run business into corporate run business, but somehow underestimated
the challenges relating to – Infrastructure, Motivating and Transforming unprofessional
manpower into Professionals, linguistic rudeness and behavior from rural workforce, legal
compliances & documentation, implementation of uniform for staff etc.
Operational strategy
 Infrastructure Development
 Motivating and transforming unprofessional employees into professionally sound and
efficient workforce
 Linguistic rudeness and unprofessional behavior by rural workforce
Operations Strategy on the basis of the corporate strategy

22. Page 17 of 18
Manipal operational excellence

23. Page 18 of 18
CONCLUSION
With highly Competitive and fastest growing market companies should focus on Recognition in
industry, Socio-Economic Changes, Brand Development, Extension To Related Business,
Opening with the Insurance Sector. Apollo and Manipal are successful in increase there market
share withy their adaptive strategy and achieving operational excellence.
REFERENCES
 Applo hospital annual report.
 Manipal hospital annual report.
 IBEF India Brand Equity Foundation 2017 promotional Boucher.