Case Study: the Merger of Two Hospitals Essay

1684 Words Feb 24th, 2014 7 Pages
Case Study #1

The Merger of Two Competing Hospitals

1. What specific steps should the board take to create an executive team to manage the newly organization?

Appointing a management team that can rightfully represent both institutions needs to be the primary concern of the board in creating a new executive team. It will be important to keep in mind that upper management within Banner Regional Medical Center (BRMC) had recently changed due to the exit of several key members; the new representation should reflect this change. The consolidation agreement should be closely adhered to because it stands as a written and physical agreement between the two hospitals. Close attention to the ramifications within the agreement will be
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Employees will be coming from two very different management styles, so it will be important to explain the new organizational structure and who employees will be expected to report to. Creating a brand for the new organization is also important to produce employee and public recognition of this culture. A new symbol or logo should be produced that represents the new organization as it intends to be perceived.

3. How should management deal with the physical structures at the time of the consolidation?

BRMC has offered to return its hospital to the county and has a payment plan established to pay BRMC for the facility. The merger should focus on building the reputation and success of the new facility, while learning from the financial failures of the former two hospitals. As measurable success presents itself in the new facility, the exisiting PRMC facility should simplify its scope of services. The privately owned PRMC facility would benefit from a gradual shift to specialty services. If this facility cut some of its costly or weaker programs it may be able to build up specialty services like radiology, rehab, or dialysis. PRMC’s reputation would build and there would be a greater utilization of these services. For PRMC, significant strength in a few areas is much more valuable than moderate performance in many areas. Funding would come from the cut programs at PRMC and the strategic planning for financial success in the new institution. 4. How

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