My Case Study Measurement And Analysis Of Boston Child

My Case Studymeasurement And Analysis Case Studyboston Childrens Ho

My case Study: Measurement and Analysis Case Study: Boston Children’s Hospital; Boston, Massachusetts Warbird develops custom data measurement tool to help world-renowned children’s hospital increase international market share The Opportunity Recognized as one of the most prestigious and high quality tertiary and quaternary care centers for children in the world, Boston Children’s Hospital sought to increase its share of the global market for children’s healthcare services. According to CFO David Kirshner, although Children’s is renowned for several areas of clinical expertise, there was growing concern about overseas competitors. “We needed to get our arms around how to best measure our international business information flow and ability to process our patients in a timely and effective manner.” David knew that hospital decision-makers would need concise and timely data about the strengths and weaknesses of the international business and patient flow process within the Children’s system in order to grow international market share.

He engaged Warbird Consulting Partners, a professional services firm specializing in value-driven organizational solutions, to develop a measurement and analysis tool designed specifically for hospital executives and physician leaders. David and Steve Nichol, Children’s lead director of the measurement effort, worked with Doug Fenstermaker, Warbird Consulting Partners’ managing director and leader of the company’s healthcare practice. A former healthcare executive with 18 years’ experience as a hospital CFO, Doug helped David and Steve develop a detailed measurement device that identified core indicators, process-oriented performance indicators, and data elements that would need to be captured.

The data would be provided in an easy-to-use dashboard interface that both meshed with and reflected progress on Children’s newly-developed international business strategic plan. The project was completed in approximately 90 days and results were presented to the internal board that governs international business, chaired by Alan B. Retik, M.D. During this time, project managers also partnered with Huron Consulting Group’s higher education practice to assist in the creation of a long-range strategic plan for international business development at Boston Children’s Hospital. The hospital embarked on a multi-phase effort to implement the measurement system.

Some key performance indicators – such as those related to revenue – were put into operation immediately while other, more complex indicators continued to be developed and refined. The Boston Children’s Hospital international patient data measurement tool shows how Warbird can add value by custom-designing a solution to meet discreet organizational needs. The selected data indicators provide hospital executives, managers, and physician leaders important information about the timeliness and effectiveness of information flow. The data also provides insight into communications and processes in managing a patient at Children’s – from the point of inquiry to the point of returning the patient to the country of origin.

By being able to easily access critical indicator data about patient processing, hospital leaders are able to identify points where added efficiency will make Children’s a more attractive choice for patients coming from overseas. Results: Measuring turn-around time and key economic indicators The following is an excerpt of the table prepared for Boston Children’s Hospital that shows the nature of the custom-designed measurement tool and the types of indicators to be measured. Each indicator helps hospital leaders and Children’s international oversight board understand where the process is effective and efficient and where it can be improved. This indicator system was integrated with the hospital’s international business strategy to give management and others insight into the effectiveness of Children’s overall international business approach, including timeliness, communications, information flow, and actual patient care delivery.

The hospital populated the table with indicators from its data systems and uses the table as a dashboard for performance reporting to Boston Children’s Hospital senior leaders and international board of directors. FINANCIAL ANALYSIS 2 FINANCIAL ANALYSIS Financial analysis usually involves the use of financial data in order to make an assessment of the company's financial performance and it is used to make recommendations on how to make improvements. It is observed that financial analysis usually carries out their work in excel sheets in order to analyze historical data and make possible projections on how the company is going to perform in the future (Hales, 2006). In this part of the paper, we are going to examine major forms of financial analysis, how they are used in organizations, and the possible similarities and differences which might exist.

There are several Financial Analysis techniques which include; 1. Vertical 2. Horizontal 3. Leverage 4. Growth 5. Profitability. In this paper, we will focus on Vertical and Horizontal Financial Analysis.

Vertical Financial Analysis

This form of financial analysis involves examining the components of the income statement by dividing each line item by total revenues to express them as percentages. This common-sized income statement allows for comparison between companies of different sizes by evaluating their margins instead of absolute dollar values (Vance, 2002). Benchmarking against industry peers enhances the effectiveness of this analysis. Vertical analysis provides insight into cost structures and profit margins, aiding management in assessing operational efficiency and pricing strategies.

Horizontal Financial Analysis

This analysis compares financial statement data over multiple periods, typically spanning three to five years, to identify growth trends or declines. It involves calculating the percentage change year-over-year and projecting future performance based on historical trends. Horizontal analysis helps organizations monitor operational performance, evaluate strategic initiatives, and benchmark against industry standards (Vance, 2002). It enables management to assess whether the organization is expanding, contracting, or maintaining stability over time.

Comparison of Vertical and Horizontal Financial Analysis

While both methods aim to evaluate financial performance, they serve different purposes. Vertical analysis emphasizes a snapshot at a specific point in time, offering a percentage-based comparison of line items relative to total revenue, facilitating comparisons across companies regardless of size. Horizontal analysis, on the other hand, assesses changes over time, emphasizing trends and growth patterns. Both are crucial for comprehensive financial assessment, and their combined use provides a holistic view of an organization’s financial health (Hales, 2006). For Boston Children’s Hospital, such analyses can inform decisions related to resource allocation, cost management, and strategic growth.

Financial Ratios and Performance Metrics

Among financial tools, liquidity ratios such as the current ratio are fundamental in assessing a hospital’s ability to meet its short-term obligations. For example, Boston Children’s Hospital’s recent current asset percentages of 1.9% in 2012 and 2.4% in 2011 indicate a need for careful liquidity management to ensure operational stability. Trends in net cash flows, investment, and financing activities further reveal the organization’s financial position and operational efficiency.

Implications for Boston Children’s Hospital

Despite fluctuations in assets and liabilities, Boston Children’s Hospital maintains a stable financial position suitable for ongoing care delivery and strategic expansion. Effective financial management, including monitoring cash flows and optimizing resource utilization, is essential for sustaining growth and competitiveness in international markets. The hospital’s financial statements reveal areas for improvement in liquidity and operational efficiency, guiding future decision-making.

Financial Decision-Making and Strategic Planning

Financial analysis techniques, including vertical and horizontal assessments, provide actionable insights that support strategic planning. For example, understanding cost structures and revenue trends enables hospital leadership to make informed decisions on service expansion, technology investments, and cost control initiatives. This approach aligns with the hospital’s strategic goal of increasing international market share, requiring a clear understanding of financial feasibility and sustainability.

Conclusion

In conclusion, financial analysis remains a vital component of effective healthcare management. By utilizing vertical and horizontal analysis, along with ratio assessments, Boston Children’s Hospital can enhance its financial planning, optimize operational performance, and support its strategic initiatives to expand global presence. Integrating these analytical methods into routine management practices fosters informed decision-making and long-term sustainability in a competitive healthcare environment.

References

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• Vance, P. (2002). Financial Statement Analysis for Healthcare Managers. Healthcare Finance Journal.
• Baker, R., Baker, R. W., & Dworkin, N. (2017). Health Care Finance. Jones & Bartlett Learning.
• Johnson & Johnson. (2012). Annual Financial Report. Retrieved from Johnsonandjohnson.gcs-web.com
• Finkler, S. A., Ward, D. M., & Calabrese, T. (2018). Accounting Fundamentals for Health Care Management. Jones & Bartlett Learning.
• Baker, R., Baker, R. W., & Dworkin, N. (2017). Health Care Finance. Jones & Bartlett Learning.
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• Finkler, S., Ward, D., & Calabrese, T. (2018). Fundamentals of Healthcare Financial Management. Jones & Bartlett Learning.
• Baker, R. W., & Dworkin, N. (2017). Health Care Finance. Jones & Bartlett Learning.