Case Background

Beijing Toronto International Hospital (BTIH) was a joint venture ofInterHealth (Canada) China, Inc(ICCI) and Beijing Comprehensive Investment Company (BCIC) which was approved in 1996 by the Ministry of Trade and Economic Cooperation. The hospital was located in the Beijing economic and technological development area and was a very unique hospital. The aim of the hospital was to provide superior quality medical services equivalent to that of the Western quality to two specified market segments:

advanced medical technology case solution

advanced medical technology case solution

Expatriates and Wealthy Chinese Families. To access the distinctive and superior quality services of this hospital, customers would require to purchase membership cards. The key services of the hospital include family medicine services, emergency care services and day care surgery (eye, general, orthopedic, ear, nose and throat surgery). Tertiary care, such as neurosurgery, transplants and advance cardiac care would not be performed at BITH.

As the building was near completion, the president of ICIC found that they had confronted with the issue of cash shortage because only 150 memberships were sold out of 7,000. He was very confident about the success of the project, but now due to low membership sales he became conscious about the factors which affected the progress of the project. At the point, he felt a need to redirect the marketing campaign. He had numerous options, but had to choose one effective and appropriate solution that would work best in the scenario.

Market Environment Analysis

Political condition of the China was stable, therefore, there was a notable number of expatriates working and living in China. The country was progressing well in the development phase, which was also a good sign for the success of a unique project like BTIH. The government has a number of controls on the mass media, which was making it difficult for different companies to build awareness about a product or issue within China. The Chinese government showed interest in the development of privately owned hospitals in Beijing and as a result, it imposed some very flexible rules and regulations for them.

Economic condition of the country was growing rapidly in combination with the social market reforms implemented by the government of China. The rapidly increasing rate of the economic growth attracted multinational companies to invest in the Chinese market. It was expected that in the next 10 years, the growth rate of the Chinese economy would exceed to an average of 12% per annum.

Social factor has also great contribution in the success of a project in China because the population was divided into two social segments: one with a belief on traditional medicines and treatment while the second one was open to innovation and western style of treatment. This was really difficult to attract those who prefer traditional methods of treatment and medicines. The hospital was located in a place that wasat a distance of 10 kilometers from the residential area of expatriates who were socially advance and open to innovation.

Technology at BTIH was comparatively unique and advanced to that of its competitors. The facility had access to high quality public utilities, latest sterilization equipment’s to control the spread of infection, proper lighting and maintenance, computerization and IT systems and advance medical technology for the treatment of patients. BTIH was comparatively stronger than its competitors in terms of technology because many private hospitals in China were not following the standards of practice and equipment’s similar to that of the European and American regions.

Legal prospect of the BTIH was strong because it was a joint venture of ICCI and BCIC. The regulatory authorities in Beijing were very flexible to the facility and as a result, it was free to set the standards of the Canadian health care system in China.

The Service Concept and Subscription Cards of BTIH

The service concept of the BTIH was to target two major segments of the Chinese Market: Expatriate and Wealthy Chinese families. Each family or customer would be liable to purchase a membership card from the hospital and each card would have its own distinct level of services. Key services would include family medicine services, emergency care services and day care surgery (eye, general, orthopedic, ear, nose and throat surgery). The subscription cards would also have different categories and packages such as Platinum, Jade, Gold, Silver and Bronze. See exhibit 1 for the details of subscription cards.

The hospital would have accessed to competent and responsive physicians, nurses and professional staff as well as ambulances would be available on call for 24 hours a day. The facility has limited its memberships to 7,000 families, so that they could provide immediate and quality health care services to their customers.

Reasons which slowed actual sales

Though, the target of the BTIH was tosellall the 7,000 membership cards before opening the hospital officially, but unfortunately, they had only sold 150 cards which netted US$200, 000 included the signing.............

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