Week 7 Signature Assignment
Select a healthcare organization to observe and analyze from a marketing perspective.
Write a 6- to 8-page paper delineating changes that the selected healthcare organization has experienced (or overcome) relative to one of the following:
The implementation of its mission statement or marketing strategy
The development or the introduction of a new product or service
A merger with another healthcare entity
The diversification of its services and products offered
The divesting of potentially outdated products or services
Make certain to include measures employed by the organization that affect how the institution plans to optimize or manage the results of the change.
Your paper should be 6-8 pages and follow APA formatting and citation guidelines.
Week 7 Assignment
The “health care organization” means any individual or entity that is obligated to provide, pay for, or administer health benefits under any health plan. It provides a plan to the public related to healthcare which can be helpful to the public in the present as well as in the future. Health Care Organizations are the companies that provide offerings to clinical authorities like nurses, doctors, pharmacists, etc. Their fundamental purpose is to provide well-being services at a lower price and in better amounts so that these may also be made on hand to a tremendous number of members.
The chosen Healthcare is Intermountain Healthcare. Intermountain Healthcare is a not-for-profit healthcare system and is the largest healthcare provider in the Intermountain West of the United States. The company was founded on 1 April 1975 and its headquarters is in Salt Lake City, Utah, United States
A merger is an agreement that unites two existing companies into one new company. The merger is taken between the two companies. The company may either be of the say fief or can be uncommon. The merger helped in the growth of the company where the two companies merged to form the new company and run the business smoothly and effectively.
Here in this case the merger is taking place between INTERMOUNTAIN HEALTH and SANFORD HEALTH. In this case, the merger is taking place between the other healthcare entities. Sanford health. Sanford Health, the largest rural health system in the United States, is dedicated to transforming the healthcare experience and providing access to world-class healthcare in America’s heartland (Horton et al. 2020, p.265). Headquartered in Sioux Falls, South Dakota, the organization serves more than one million patients and 220,000 health plan members across 250,000 square miles.
The merger took place in October 2020, and the two non-profit health systems signed a letter of intent to develop a strategic partnership. That partnership creates a combined organization of 70 hospitals and 435 clinics across seven states, as well as senior care and services in 366 locations in 24 states. The organization would also insure 1.1 million people.
Reasons for the merger between Intermountain Health and Sanford Health
There are various reasons for the merger between both the medical entity and some of the reasons for it is stated below-
Potential changes for the patient– According to the recent time before the merger of both the company the patient could not see any of the changes in the short run. So, to bring the changes in the long run so that more patients can see the changes and to inbuilt more new recent technology and ideas in the business. The merger is taking place so that customers can see the latest changes in the business and more investment can take place in the organization as well (Gadkaree et al. 2021, p.270). To grow digital health care the company has decided to merge the company so that more customers get attracted to the company and will take the medical facilities from this company. Previously both the company was lagging in something so this is one of the opportunities after the merger for the growth of the company as well
Future expansion- Now that various medical are expanding across the globe by adding various new features to the organization likes wise both the company also want to expand their business. Before the merger, the company couldn’t expand at the high range but after the merger took place both the company could easily expand the business within the organization as well (Chan et al. 2021, p.1485). The company wants to be the number one and number two in the country in the medical entity so they decided to merge so that they will have double capital and the investment which will help expand the business properly without any much difficulty as well. To build a strong organization in the world the company decided to work together by merging and being able to invest in the various things which help in the growth of the organization as well.
Jobs- In the case of the merger there are talks in the market that many layoffs can take place within the organization because of the various availability of the staff. But the company doubles the number of employees so that the work can be done faster with greater efficiency as in the work. It gives jobs to various other new people within the organization. With the help of the merger in the organization, growth is taking place, and due to this expansion can take place in the company (Margutti, & Chornock, 2021, p.155). As the expansion will take place in the organization more job facilities will be provided to the people who are working in the organization as well.
Use of the latest technology– Before the merger of the company it seemed that the company was not using the latest technology or the latest design and the in a fracture in the company. However, with the merger in the organization, this factor can be seen within the organization as well. It can be said that even though the company is facing issues related to it built with the merger in the company the new designs and the latest technology are been used within the organization so that it can able to attract more patients and the patients can get the services of the latest product. The patient will get treated with the latest technology devices which will help the patient as well in their recovery. According to this, it can be said that the merger is one of the needs of both the company in their growth and bringing stability in their business as well (Catalão-Lopes & Brito, 2021, p.251). With the help of the merger, both the stability and the revenue of the organization increased as well good facilities were provided to the patients as well.
There is various benefit of the merger between the two entity that has a similar function or business. Some of the benefits of the merger of a similar entity are stated below-
Access to resources- One of the major benefits that both the company can get with the merger is access to resources. It is known previously as well that both the company’s Intermountain Health and Sanford Health Company are lagging in providing the patient with the latest technology services for their care. So, with the merger between the two companies done, it creates a gateway with more resources in the organization (Malapit et al. 2021, p.3180). After the merger in the organization both the organization will get a way across with the more combined resources of the organization and from there, they can plan properly to develop the latest technology for the patient. The shortage the resources will not take place within the organization and it helps to improve access to materials, suppliers, and tangible resources through the acquisition
Access to the best talent– It can be said that with the merger in the organization both the company can get the best talent employees for their organization as well. With the merger between both organizations, it is that growth in the organization has taken place and with that growth in the organization, it is clear that the more talented people will get attracted to the big company due to the various facilities that the big company provides their employees. With this, the various talented people will work within the organization which helps to increase the organization’s growth and more talented people will work for the company and its growth as well which will help in bringing growth to the company as well.
Economic of Sale- Often, the end goal of a merger and acquisition is to realize economic gains and economies of scale. This becomes possible when the two firms involved in the merger are stronger, more productive, and more efficient together than apart. Businesses consolidate to reap benefits like increased access to capital, better bargaining power in the market, lower costs resulting from high-volume production, and more (Damschroder et al. 2021, p.5). With the merger between both the company, the economic growth of the company will take place and it is one of the reasons for the benefits which take place and the reason for the merger between the two companies as well. With the help of the merger in the organization, the economic condition of both the companies will be increased as the savings will be and both the companies will be able to enjoy the benefit as well after the merger.
Cost-effective alternatives– Mergers and acquisitions present a cost-effective alternative to starting from scratch. Setting up production centers, buying machinery and equipment, building storage places, and initiating distribution channels are costly. It is more cost-effective to merge with another company already equipped with the facilities you require. The merger between both the company will be considered cost-effective because each of the companies has some of the equipment with them as well and the merger taking place helps to double the equipment and other the necessary as well. So, the investment will be reduced and there will be more capital will be there to invest in the latest products and technology as well (Budhiraja, 2021, p.5). If the organization runs singly then there is various cost that takes place in the initial stage built with the merger both the company will combine and they will get access to the various new equipment of both the company as well. This can be termed the cost effect as well which saves further investment in the product as well. So, it can be said that a merger between Intermountain Health and Sanford Health entity is considered to be a benefit to both the company and it helps in the growth of the organization as well.
Losing the trust of important stakeholders– Although it can be considered that the merger is good for the organization because it helps in the growth of the organization there are various challenges that the organization faces in the merger. Likewise in the case of the merger between Intermountain Health and Sanford Health, it is seen that the trust of the important stakeholders has been lost. The stakeholder believes that the organization will not be able to perform properly and this is the reason that they are merging with other companies (Stevens & Butler, 2020, p.230). The stakeholder lost their trust in the company that the company can perform better in the future because, in the present itself, they are unable to meet the requirement and have opted for the merger as well which create a loss of trust in the working of the organization as well.
Overpaying– Overpaying is one of the reasons for the difficulties the companies have to face while doing the merger in the organization. One such issue takes place in the Without question, the most common problem that arises in mergers or acquisitions is overpaying for companies. A large part of this is because the mergers and acquisition challenges on this list destroy company value, making an overpayment inevitable. And there’s another universal problem that stalks transactions – sellers only tell you when you’re not paying enough, but never when you’re paying too much. A good way of avoiding overpayment is by looking at a suitable value for that firm as a limit, but not a target. This small but important shift in thinking can end up saving millions of dollars and overcome the overpayment problem. Sometimes in the case of the payment related to the merger is often seen that the excess amount is paid in a hurry and sometimes the seller refuses to accept that they receive the excess amount as well.
Risk– Economic, industry, or technological shifts can mean that even the most well-planned deals can fail. It’s a good idea to build conditions into the transaction contract to protect your firm against downside risks such as falling sales, customer numbers, or even the termination of important contracts. The risk is as though the merger is taking place but the company is getting or facing the same issue and the growth is also not taking place in the organization as well which creates lots of issues and the merger between their organization fails as well.
Inadequate due diligence– Almost everyone in M&A is aware that these steps should be taken, but shortcuts are still common, therefore, the business community still sees it as one of the most common problems faced in mergers and acquisitions (Reddy, Mazhar, & Lencucha, 2018, p.5). Bankers sometimes use the expression, ‘whatever drags get dirty’ around M&A, believing that efficiency is key to successful deal-making. Efficiency means efficiency, not cutting corners. This problem may be one of the easiest to avoid – there is simply no excuse for not conducting thorough due diligence. It can be said that this is a common risk that takes place in the organization as well.
It can be concluded that the merger between Intermountain Health and Sanford Health took place so that the growth in the organization could take place. By seeing the merger that has taken place in the organization it can be said that the merger is beneficial to the organization as after the merger the organization is to be part of the organization as well and is growing properly. The merger acts as a benefit to both companies as previously there was no growth seen in the organization but now the growth is seen and the various people.
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