How would you structure this Healthcare prompt?

Hi,

This is a strategic “Go or No-Go decision”. A very clear approach would be to first clarify with your interviewer the underlying goal of the client (e.g., increasing profits), and establish whether the client has a particular target level in mind for their goal. Then:

1. Narrow down the core question: "Should the client add a pathology department to the hospital?” 
2. Define the criterion according to which the question can be answered with "yes". This means, our recommendation to the client will be “yes” only if the additional value (e.g., the additional profit, if this is the client’s goal) we can create from opening and running this new department over the client's investment horizon is significantly higher than the investment cost. Moreover, the client needs to have the required capabilities (both, operational and financial), and must be able to manage potential risks associated with this strategic decision.
3. Outline how you can test whether the criterion is met (i.e., how to test whether the additional profit will significantly exceed the investment cost over the client’s investment horizon). This can be done by a deep dive into the “additional value” bucket by means of a profitability tree. 

That's it! This is how you address strategic questions without shooting out non-substantiated hypotheses (or rather wild guesses!), while still being super top-down and super efficient.

I hope this helps.

Cheers, Sidi

_______________________

Dr. Sidi Koné 

Former Senior Engagement Manager & Interviewer at McKinsey | Former Senior Consultant at BCG | Co-Founder of The MBB Offer Machine™

Hello,

Interesting question! I would structure it like this:

Pathology Market in city X:

- Current Demand for this services

- Expected growth

- How do customers in this city currently use those types of services?

- Is there any trend in this medical area we should be aware of? (New equipment, AI, ..)

Hospital:

- Main sources of revenue (is it public funded, is it private?)

- Current departments

- Target customers

- Key differentiation points (is the hospital known for any specific department? Maybe if its an hospital known and with an expertise in another area, might not make sense)

Building pathology department:

- Financial analysis:

     - Initial investment (how much is expected (equipment, space, hiring) ? can we get funding?

     - Recurrent profit (how will this impact revenues? what are the running costs? Can we expect any kind of synergies with other departments (sharing equipment, medical staff, ..)

- Qualitative analysis:

    - Medical staff (do we already have the medical staff inhouse? Do we need to hire? Can we actually hire?)

    - Impact on customer perception of hospital (hospital gets bigger and more known, might make people to be more likely to come for another department)

    - Serves the community (more relevant if public hospital, possible cost savings to community if need to travel less to another further hospital)

P.S.: I'm not an expert, so any feedback is welcome!

Hi There!

For me, this is how I would structure it:

First, I would try to understand what is the objective behind opening this pathology department. In this case it seems to be that they want to offer the full value chain of health services.

Having clarified this, this is the structure I would go for:

1. Demand for pathology services
a) What is the market for pathology services (number of       patients/ day)
b) Competition (i.e.: where are the patients currently going)
c) What advantages would our hospital have that competitors do not

2. Financial viability of opening the new department
a) Investment/budget required (CAPEX) and whether do we have the capability
b) Expected turnover of the department based on demand in 1.a
c) Expected OPEX 

3. Feasibility of opening the new department
a) Does the hospital have the required capabilities (both human and non-human such as space within the hospital)
b) Do we have the necessary license/permissions, etc…

4. (Optional) Risks & mitigations

If you distil this prompt to its essence, this is a new product type case. 

A company that offers something is thinking about offering something additional. How do they know whether they should do it or not? 

There are lots frameworks that you can find for this case type, but at best you will get to an average answer with them. 

I would encourage you instead to come up with a framework that is operational (e.g., set of subsequent questions) that will enable you to give an actual answer to the client. You can do that by leveraging first principles structuring. 

Feel free to share an example structure, and I am happy to provide some feedback on it. 

Best,
Cristian

Hi there,

I would be happy to share my thoughts on your question:

• First of all, it would be great to see how you would approach the initial structure of this case question so that I can give you feedback on it.
• Moreover, you might want to consider both the financial and medical perspective on this question, i.e., pathology needs to add value both in terms of profits and synergies for other departments.
• Lastly, I would advise you to consider reaching out to an experienced coach to improve on the skill of structuring case studies. I have designed the Case Structuring Program specifically for candidates who struggle with structuring a case study like a consultant would do.

If you would like a more detailed discussion on how to best prepare for your upcoming interviews, please don't hesitate to contact me directly.

Best,

Hagen

In a real case it is always important to know:

1. What do they want to achieve? 

2. How do they measure success?

You want to make sure you are not solving for the wrong metric.

Major flaw I saw on all the suggested approaches until now: it completely ignores that it is an existing and already-functioning hospital.

In other words, their structure would be exactly the same if the case was about a completely new clinic single-focused on pathology. It ignores it is an hospital (which has with multiple services), and ignores the hospital is already functioning.

You need to consider “synergies” with the existing structure. Basically, what is the demand from current services for pathology, how it would improve their outcomes, how it would improve their revenues, how it would improve existing customer experience etc.

Always customize for the specific situation.

This is a business decision problem.

“Should the hospital add a pathology department?”

And then you start with a few evaluation criteria:

• Is it financially beneficial?
• Is it strategically important?
• Is it operationally feasible?
• Is it legally allowed?

And then you start adding hypotheses under those pillars to further flesh out your framework and subsequent analysis.

Give it a go and we can discuss further over messages and a coaching session if needed.