Arvind eye care hospital

The Arvind Eye Hospital, Madurai, India

20%

67%

7%

7%

The blindness Problem

AfricaAsiaLatin americaothers

Developing Countries Developed country

Macular Degeneration Cataract (75%)

Diabetic Retinopathy

Glaucoma

WORLD WIDE (1992)

Projected- 30 Million


•180 million people suffer from blindness world wide •50 million people in the world are bilaterally blind

•90% of the world blind live in Developing Countries•60% of which reside in Sub Saharan Africa, India and China

•In Africa one in every 100 people are Blind•In European nations it is 0.33% per 1000

60%

40%

Global View (WHO)

CatarctFocal diseasesWHO estimates by 2020 the number would increase

by 75 million globally

Reference- “Low vision assessment” -By Jane McNaughton, Jane McNaughton (MCOptom.)


Scenario of Blindness in India (1991)

Population 850 Million

Blindness 20 million blind eyes (2 million being added annually)

Main Cause Cataract (75-80%) uniformly distributed

Ophthalmologist 8000 performing 1.2 million Cataract Operations/year

Eye Hospital 42,200

Medical R and Infrastructure

Two-third skewed to the Urban areas where less than one third of the nation’s population lived

District Hospitals 425 offering free eye care and cataract Surgery

Revenue Allocated Rs. 60 Million ($2milliion) for blindness prevention

Challenges 1. Proper Infrastructure2. State of Art Equipment3. Training Personnel

Government Initiatives


VISION :

To Mass Market Cataract Surgery on a Global perspective

DREAM- “Eradication of Needless Blindness” by creating a private, non profit eye hospital that would provide quality eye care

Offer quality eye care at reasonable cost

Provide services to rich and poor alike

Dr. G. Venkataswamy


DEVELOPING NATIONS

CHALLENGES AND ISSUES

• Large % of people are poor and people do not have health Insurance

• Government Infrastructure poor to provide adequate health Services

• Lack of Incentives to promote excellence and concern for the poor

• International and local non governmental organization depend on donations for Operating Cost they find it difficult to finance and expand services

• When the organization is tied into the charitable mentality for their fund raising appeals, they often lack the skill and attitude to earn money

• Lack of business planning skill to raise money


Dr. V’s Approach and ‘Level 5 leadership’ concept

APPROACH

•Carry out a high quality process at low cost

•Followed the idea of reproducibility

•Achieving High productivity by a significant process innovation driven by close analysis of value adding time

• Economically self sustaining Model- By generating enough Revenue from the paying Patients to recover the cost of providing eye care free of cost services to the Majority

Reference: ©2005 Joe Tidd, John Bessant, Keith Pavittwww.wileyeurope.com/college/tidd


Three Key Elements that defines the Arvind Business Model

Economies of scale

Cross-subsidies

Vertical integration

Reference: Treating Cataract In India (Case Study)


Conceptual Foundation

Bottom of Pyramid concept

The Hedge Hog concept

Best Cost Provider Strategy

Three Horizon Strategy Concept

Arvind Eye Hospital Model Revolves

around the Following conceptsLevel 5 Leadership Concept

Cost

Rec

over

y M

odel


Level 5 Leadership Concept

Level 5 Leaders lead with Disciplined People, Discipline Thought and

Disciplined Action

•Identify Discipline people, but do no manage them because they do not

need to.

• Through these Discipline People or right people they manage the Whole

System

• These disciplined People bring in the necessary discipline for Executing

Organization strategy

• Finally desired or Expected results are achieved


Journey from 1976-1981

1976

1977

1978

20 Bed Eye HospitalGoal- Providing Quality eye care at reasonable cost

30 Bed AnnexGoal- To accommodate patients after surgery

70 Bed Free HospitalGoal- Providing poor with free eye care

1981 Main Hospital• 250 Beds• 80,000 sq. feet space• 4 Major O.T.

Specialty Clinics • Cornea Glaucoma• Squint Corrections• Diabetic Retinopathy• Pediatric Ophthalmology

Features• State of Art Equipment

Standardizing and Engineering The Cataract Surgery


HORIZON 1

HORIZON 2

HORIZON 3

“Short Jump Initiatives”

(Fortify and Extend Current business)

“Medium Jump Initiatives”

(Leveraging existing Resources)

“Long Jump Initiatives”

(Sow the seeds for

Growth and Businesses for

the Future)Stra

tegi

c In

itiati

ves

TIME

Three Strategy Horizons Concept

Challenges and issues

Reference: Crafting & Executing Strategy: Arthur A. Thompson


HORIZON 1

“Short Jump Initiative”

Objective:

• Fortifying and extending the company’s objective

1984 Building up of 350 bed free Hospital• 36,000 sq. feet space• 2 major OT and Minor theatre for Septic care• Medical Personnel from main Hospital

Strategy ASSEMBLY LINE PROCESS

Building of Hospitals in Tirunellvelli (1985) , Theni (1988) and other places of Tamil Nadu

Eye Hospital, Since 1976 Three Strategy Horizons


From………………………McDonald's…………….................To…………………..Mc. Surgery

"A blind person is a mouth with no hands,“ is an Indian saying that Dr. V liked to quote.


McDonalds, has managed to spread its golden-arched empire across the planet based on

•Systematic

•high volume production of a range of meals offered at low cost

•Idea of reproducibility

•All McDonalds outlets operate on the same model

•Staff are trained in a core set of skills which are common to all its operations

Reference: ©2005 Joe Tidd, John Bessant, Keith Pavittwww.wileyeurope.com/college/tidd


“WHY Mc. Donald’s CONCEPT WAS SO FASCINATING ?”

McDonald's success can be attributed to the following:

• Defining the basic premise of the service they offer

• Breaking up the labor into constituent parts, and then continually

reassemble and fine tune the many steps

• System works without a hitch, to the degree that such operations maintain

quality control, and cherish customer satisfaction, profits flow


Assembly Line Model: The Main Hospital and The Free Hospital

The Morning is usually heavy an people are divided into two groups for evaluation

Ophthalmic Assistants Eye DoctorSenior Medical officer

Final Examination Records Persons Vision Preliminary Eye Examination

Records Preliminary Diagnosis of the patients Medical Record

Testing the patient for Ocular Tension, Tear Duct Function and Refraction Test

PHASE 1


Final Examination(Patients Could be Sub Divided as)

Patients for Corrective Actions

are suggested Optometry Room for measurement

and prescription of Glasses

Patients referred to specialty Clinics

Patients for Cataract Surgery

• 20 patients seated in the halfway were prepared by the Medical Staff

• In the O.T. there were 2 active operating table• 3 rd Bed for preparing Patient

• Cataract Surgery took 15mins.• The moment first operation completes the Next starts

Assembly Line Model: The Main Hospital and The Free Hospital


Cost Recovery is possible in Cataract Surgery

Carrying Out high Quality Process at Low cost

Cataract unlike most surgical procedures is the same procedure performed repetitively with Little Variation

Per unit surgery cost vary very little, allowing for very accurate cost projection

Same procedure performed repetitively hence facility set-up, Training procedures can be standardized

Cataract is procedure oriented and curative. People are generally willing to pay for cure but unlikely to pay for preventive services

Because of large number of people requiring Cataract surgery in Developing Countries, it is one of the few health care procedures that has the potential to pay for itself through user fees.


Principles of Cost Recovery

Cost Recovery Principles


Source: Data supplied by Aravind Eye Care System.


Factors assisting Arvind Eye Hospital- Eye camp Model

Several facilitating factors helped AEH make its business model sustainable

AEH draws its patients to eye camps through organized local Business units

Organizations bear the publicity costs and other costs incurred

Organizations also pay for expenses related to transportation and meals

AEH gets supplies of IOL lenses and other products at a substantial discount.

Reference: Bottom of Pyramid by, C.K. Prahlad


0

1

2

3

4

5

6

7

8

9

10

79-80 81-82 83-84 85-86 87-88 89-90 91-92 93-94 95-96 97-98 99-00 01-02

Year

Million $

Revenue Expense

Paying 35%Free Camp 47%

Subsidized 18%

Through a unique fee system & effective management, Aravind provides free eye care to 2/3 of its patients.

For each $1 spent, $1.60 is earned

Financial Viability


FREE HOSPITAL and EYE CAMPS : MADURAI

• The outpatient facilities at the free hospital were not well organized

• There was a temporary shelter at the free hospital’s entrance

• Those who came for a return Visit were directed to different lines

• Less administrative assistants helping patients and guiding them sequential flow

• Operating theatre appeared to be more crowded and cramped

• Only 1 or the other operating tables was equipped with an operating Microscope

• Free hospital did not have “beds” in which to recuperate and recover

• Need of Organized Camp, Need to Create Propaganda, and Organizing of Logistics

• Requirement of consistent set of procedures and common set of Principles

CHALLENGES AND ISSUES CONCERNED


INITIATIVES FREE HOSPITAL and EYE CAMPS : MADURAI

INITIATIVES

The Government of India launched a cataract blindness control programme with World Bank funding and offered a subsidy for the camp patients. In stages, the number of beds increased to the present 1468 beds (1200 free and 268 paying) in the hospital at Madurai.

Multiple "camps" were conducted every week, to propagate more and more about the services. Skilled and technically qualified personnel were brought in solve out these issues.

The use of mats enabled better utilization of floor space —about 30 patients could be accommodated in one room.

Establishment of complete Arvind Eye care system, helped in Eliminating the Major Issues Concerned, to provide quality eye care, Keeping in view the requirements of every patient, so as to instill a satisfaction within them as far as the services were concerned.


INITIATIVES FREE HOSPITAL and EYE CAMPS : MADURAI

INITIATIVES

The Arvind Eye Hospital, had build up an excellent IT system that kept track of all the patients. The system generated daily schedules taking into account the load on that day, patients’ preferences for doctors, and the pending work. This enabled the hospital administration to keep track of the workload in different units.

The Aravind management kept a very close track of the intra-operative as wellas post-operative complication rates. The major complications were very much under control and were considered highly satisfactory, according to the doctors at Aravind.


HORIZON 2:“Medium Jump”

• Leveraging existing resource and capabilities by entering into new areas with promising growth potential

Arvind Eye Hospitals gradually shifted to become the Arvind Eye Care System.Community Outreach Programs (1500/year)

Making Technology Affordable (AUROLAB)

A 874 bed hospital (1997) was opened atCoimbatore & 750 bed hospital (2003) at PondicherryTotal of 3649 beds, consisting of 2850free and 799 paying beds

Three Strategy Horizons


20 Bed to 600 Bed Hospital – What served as the Major footsteps?

Brother Shri

G .Shrinivasan

• Constructing all 5 Hospitals

•Serving as Hospitals Finance Manager

Nephew

R.D. Thulasiraj

•Gave up the management job•Joined as Hospital administrator

organized local Busin

ess unitsFamil

y Members

•Sister and Brother in law gave up there Govt. jobs to fulfill Dr. V dreams

Major Footsteps• SEVA• CIDA• Sight Savers


Personal Needs

Expected Service

Perceived Service

Service Delivery

Translation of Perception

Management Perception of Consumer Expectation

Word of Mouth Communication Past Experience

External Communication

GAP

GAP

GAP

GAP

SERVICE QUALITY MODEL


Expected Service • Doctors requirement for Long Hours of concentrated Work• Dedication and Devotion to the Practice

GAP •Most believe they need work only for a few Hours and that too two days a weak•Requirement of well trained people not fulfilled

Perceived Service Lot of chaos in free hospitals

Service Delivery Operating theatre appeared to be more crowded andCramped

GAP Less administrative assistants helping patients and guiding them sequential flow

Translation of Perception

Operating efficiently a good number of Patients

ASSOCIATING DR. VENKATASWAMY CONSIDERATIONS TO SERVICE QUALITY MODEL



FREE HOSPITAL : THULASI and TIRUNELVELI

• Less occupancy rate in the free hospital (7), (9)

• On Monday, Tuesday and Wednesday – Patients are Overflowing (2), (1)

• Repayment of Cost of Capital (7)

• Not Financially self Sufficient (6), (7), (8)

• Meeting up the salary scale as compared to Private Hospital (3),(6),(7)

• Getting people who are motivated towards the working philosophy of Arvind eye Centers (10)

OTHER CHALLENGES OR ISSUES CONCERNED


Reasons and Proposed Action: (Dr. V’s Insight)

“Despite all our efforts, so many people with problems with their vision have still no access to hospitals. Much of the blindness can be corrected through

surgery. But they are afraid of operations. So we have to increase the awareness of the causes of blindness and the need for early treatment. Even in villages where we conduct eye camps, only seven percent of people having

eye problems turn up. We have to do more to create demand.”

Other Initiatives•Increasing community involvement•Community eye health education through various programmes:

Diabetic Retinopathy Management Project (2000)

Community Based Rehabilitation Project (1996)

Eye Screening of School Children

Use of IT Kiosks for Tele advice


Cost Provider Strategy

Overall Low cost

Focused Low costFocused

Differentiation

Broad differentiation

Best- Cost Provider Strategy

Mar

ket T

arge

t

Reference: Crafting & Executing Strategy: Arthur A. Thompson

Lower Cost Differentiation


Reliability:

• At the hospital the staff must inform patients when and where services will be run…like eye camps

• At the hospital the staff should be more prompt in providing services

Safety:

• behavior of the staff should be such to reassure the patients

• At the hospital the team should have adequate knowledge to answer patients questions…because it instills assurance within the patients that …this hospital is good and our investment is worthwhile.


Reliability:

• The hospital must operate during the times when maximum percentage of patients availability suits there time and the rest part should be shown to other activities.


HORIZON 3

“Long Jump Initiatives”

Objective:

• Initiatives to sow the seed for Growth in Businesses of the future• Balancing the Portfolio

• Establishing Lions Arvind Institute of Technology

• Arvind Medical Research Foundation

• Eye Bank- Rotatory Arvind International Eye Bank

Three Strategy Horizons


OVERVIEW

(LAICO) initiated a capacity building process with other eye hospitals elsewhere based on Aravind’s experience in providing eye care service in partnership with the network of eye care NGO’s working in India and abroad.

3 Major activities in Capacity Building Process

• Need assessment Visit

• Vision Building

• Follow up


THE GRAND PORTFOLIO

“ARVIND EYE CARE”


A R A V I N D E Y E C A R E S Y S T E MA R A V I N D E Y E C A R E S Y S T E M

Other Countries :Bangladesh

Bulgaria

Cambodia

Egypt

Indonesia

Kenya

Malawi

Nepal

Zambia

Zimbabwe

Guatemala

El Salvador

Tanzania

Lions - 87Sight Savers - 39CBM - 20WHO, Orbis,Seva, others - 15Total: 161

Location of ParticipatingLocation of ParticipatingHospitalsHospitals


Eye to Future : (As per Dr. Venkataswamy)

One of our key strategic future steps is to develop dual specialties among our

doctors. We would like to retain and get the best out of our doctors. One way

may be to provide more meaning to their work. We are trying to help

doctors to develop at least one other specialty. We can then also involve

them in the running of the Aravind Eye Care System. We also need to find

resources to fund our research projects. We need to build more linkages

with other eye care institutions all over the world.

Reference: Aravind Eye Care System: Giving Them The Most Precious Gift (R1)

Date post:	17-Jan-2015
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Arvind eye care hospital

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