Disucss about the Healthcare Industry Is Involved In The Development.
Estia Health Aged Care Company belongs to healthcare industry is involved in the development and operation of owned along with leased residential care homes within Australia. For over years the company is engaged in developing and operating leased and owned residential aged cared facilities within Australian market (Towart 2017). The company has more than 68 facilities within 5,910 operating places within South Australia, New South Wales and Queensland. The company initiated its business in the year 2005 within Australian market (EstiaHealth., 2018). The company has a strategic priority of operating in a successful market and offering a range of care services from offering semi-independent living. The company also has a strategic aim to attain high success in the health care industry in offering personal assistance, meals, and therapies along with lifestyle activities (Rothaermel 2015). The objective of the company is to develop specialized healthcare teams and offer inclusive along with caring experience. The mission of the company is to make sure that it carries a proud heritage of offering superior healthcare service all through the nation. Vision of the company is to maintain a shared commitment of offering quality resident based services and clinical care. It is also assumed that the aged care industry environment factors and its impact on the company is deemed to have an impact on its position in the marketplace.
Political- Fact: In investing or entering within a particular market, the company must be aware of all its political and system risks. The Agent Care Pricing Comissioner (ACPC) is a statutory and independent office holder that is appointed based on Aged Care Act and reports to aged care minister (Ginter, Duncan and Swayne 2018).
Implication: Such political factors that must be considered are risk of military invasion, intellectual property protection, work regulations, pricing regulations and favored trading partners. Companies that are operating in the healthcare industry require attaining pricing approval from ACPC before mentioning price range within its brochures.
Impact: High/ Medium
Economical- Fact: The social structures of Estia Health Limited are not self-ruled or financially independent. Support and control are maintained by Ministry of Aged Health. The local structures are deemed to operate at low cost per capita that is lower than having to offer close aged care to people.
Implication: There can be drastic implication of inflation, growth rate along with economic indicators such as healthcare services and equipment industry growth rate on the company (Wheelenet al. 2017). Estia Health Limited can also consider consumer spending, government intervention within free market and economic growth rate to have implication on the business.
Impact: Medium/ High
Social- Fact: Increasing aging population includes a huge baby boomer generation that accepts increased pressure on Australian economy. This has also resulted to changes in aged care expectations and preferences.
Implication: Shared attitudes and beliefs of the population have a major role in the way marketers at Estia Health Limited will understand its consumers in a specific market. Emerging aging population can impact the company can include skill level of the population, culture and attitudes of consumers on environmental consciousness.
Impact: Medium
Technological- Fact: In the recent years, vast information proliferation, communication technologies and widespread internet diffusion integrates new technologies within the aged care along with health care policies. Adoption of e-health initiatives offers innovative approaches in certain areas of aged care.
Implication: Implications of the facts consider that the company musttake into account rate of technological diffusion and cost structure impact on aged care services and equipment industry (Morden 2016).
Impact: High
Environmental- Fact: Green information technology is being adopted greatly within the aged care industry. Considering the same Estia Health Limited have considered that political imperatives can be attained by the company electronically.
Implication: Certain environmental factors that can have implications on the company include water and air pollution regulations within health care services and equipment industry and attitudes toward and support for renewable energy.
Impact: Low/ Medium
Legal-Fact: Introduction of clinical safety directives along with legislation on aged care medical advice has facilitated the company in dealing with several issues. The set of related laws and policies offers an opportunity for selling consultancy.
Implication: Certain legal implications must be considered by the company before entering foreign markets that can result in theft of its competitive advantages. These implications include anti-trust law within health care services and equipment industry, discrimination law and health and safety law (Barbara et al.2017).
Impact: High
VUCA for the factors those have high ratings are explained under:
Legal
Volatility- Aged care based laws and policies do not change regularly. This happens through policy makers’ obligations. The federal and state governments focus on maintaining the necessary changes in policies.
Uncertainty- Policy setters consult constituents while taking any suggestion regarding the policies. Laws might not have a prompt impact to deal with threats and bring in opportunities.
Complexity- A very complex structure is involved that includes strictly regulated laws that highly rely on the government structure.
Ambiguity- As every individual stay informed, there is no lack of knowledge in the areas of regulations and policies.
Technological
Volatility- There is a use of supportive technologies in order to offer better care for aged people in their own place serves as a concern that is promoted for years.
Complexity- The advanced technological surrounding is quite complexto be used for offering up-to-date and sophisticated aged health care services.
Uncertainty- Bridging the gap is needed between technological reality that is available on one side and non-existenttechnological abilities of program’s structures.
Ambiguity- There is a huge integration in the new technologies such as e-health in aged health care sector at the forefront of added care policies (Abs.gov.au. 2018).
Porter’s five forces Analysis of Estia Health Limited will analyze the considerableimpact of the five forces on a company’s profitability within which the industry operates.
The aspects of this analysis for the company are explained under:
Threat of new entrants
Fast industry growth rate has a considerableimpact on the aged care industry and the company. There is a hence that the company might attain market share from all its competitors as the total industry size is growing (Papastergiouet al.2017).
Bargaining power of suppliers
This power might have decreased because of the reason that increased government regulation because of ACPC that can decrease negotiable options.
Bargaining power of buyers
Bargaining power of institutional buyers with increased government regulation because of ACPC thatdecreasesattractiveness of alternative derivatives. Customer direct care program implementation decreasedtheir switching costs.
Threats of substitute services of products
Threat of substitutes can be observed from the care offered within retirement village. This threat is dealt by Estia Health Limited through offering home care packages along with Commonwealth Home Support Program.
Rivalry among the existing competitors
The Companyoperates within highly competitive Aged Health Care services industry that can impact the profitability of it (Lamas et al.2017). Competition is deemed to be low because of strict government control over supply and pricing.
Certain opportunities are identified to be attained by on Estia Health Aged Care Company on the basis of PESTEL and Porters Five Forces Analysis. There is an increased chance of strengthening and better use of resources with other social structures. Relationships with other structures can be strengthened and expanded that facilitates wider cooperation, good practices exchange along with joint actions and initiatives.
Certain threats are identified to be attained by on Estia Health Aged Care Company on the basis of PESTEL and Porters Five Forces Analysis.Increased regulation on Ministry of Aged Health can increase the costs associated with the company that can serve as barrier to entry in case the company intends to expand in international market. A great focus on cost-cutting might leave the company vulnerable because of crippling lawsuits in case there is subpar added care or harsh working conditions.
Conclusion
The objective of the paper was to carry out strategic management analysis on Estia Health Aged Care Company through carrying out PESTEL, porters five forces, VUCA and SWOT analysis. It was gathered from the paper that SWOT analysis of Estia Health Limited facilitated in realizing the position of the company in the industry along with challenges faced by the company for developing strategic recommendations in attaining competitive edge. Porter’s five forces Analysis of Estia Health Limited was analysis the considerable impact of the five forces on a company’s profitability within which the industry operates.
References
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Estia Health., 2018. Estia Health Aged Care: Australian Aged Care | Aged Care Facilities | Residential Aged Care Facilities | Nursing Homes. [online] Available at: https://www.estiahealth.com.au/ [Accessed 30 Mar. 2018].
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