QUADRIA CAPITAL: DOING WELL BY DOING GOOD IN ASIAN
INSTITUTE OF GASTROENTEROLOGY HOSPITALS CASE
STUDY SOLUTION
e
pl
SYNOPSIS
m
Sa
Founded in 2012, Quadria Capital Investment Management Private Limited (Quadria Capital) was
committed to its mission of using its expertise to do well by doing good through bringing affordable quality
health care to Asia. In July 2013, it found such an investment opportunity in the Asian Institute of
n
Gastroenterology (AIG) Hospital in India. AIG was one of the largest gastric sciences hospitals in India
that specialized in gastroenterology. It performed more endoscopic procedures per day than any other
tio
hospital in the world.1 It had earned a global reputation for clinical excellence, being among only twenty
centres globally to be conferred World Organization of Digestive Endoscopy (OMED) 2 recognition. This
clinical excellence in the gastric science specialty and reputation put AIG in a strong leadership position
lu
and drove demand for its services. It was also renowned for its research and education in gastric sciences.
So
As exciting as the opportunity was, the two founders of Quadria Capital knew this investment would use
up a sizable portion of their funds, and they had to carefully consider the risks and what needed to be done
to decide whether AIG was the right investment opportunity for Quadria Capital.
OBJECTIVES
• Understand the challenges faced by service organizations in general, and health care in particular.
• Know that customer-induced uncertainty is a key challenge for achieving both service productivity and
service quality, or cost-effective service excellence (CESE).
• Learn about the advantages of a focused service factory (FSF) strategy for achieving CESE.
• Understand the operations management (OM) approach for achieving CESE.
The Case Solution Starts From page 5
, e
pl
m
Sa
n
tio
lu
So
ASSIGNMENT QUESTIONS
1. What are the challenges of driving productivity and service excellence in service organizations in
general, and in health care in particular?
2. Using a strengths, weaknesses, opportunities, and threats (SWOT) analysis, what was AIG’s situation
and positioning?
3. What were the reasons for AIG’s success and cost excellence?
4. Discuss the three issues the Quadria Capital team had to consider and suggest ways to
achieve/overcome them: (a) demand and patient throughput, (b) pricing and positioning, and (c)
expanding to comorbidities.
5. Based on its four-pillar investment strategy (see case Exhibit 5), is AIG a good investment for Quadria
Capital? Why?
The Case Solution Starts From page 5
, e
pl
ANALYSIS
m
1. What are the challenges of driving productivity and service excellence faced by service
organizations in general, and in health care in particular?
Sa
Productivity refers to the ratio of output per unit of input (e.g., labour, asset). Service excellence refers to
high levels of service that generates high customer satisfaction.
The trade-off between customer satisfaction/service excellence and productivity has been widely
n
acknowledged in the literature and remains a key challenge for organizations that strive for both objectives.
These two approaches conflict because too strong a focus on cost reduction associated with productivity
tio
can reduce customer satisfaction, and concentration on customer satisfaction is assumed to cost more,
thereby reducing productivity. Research has shown this trade-off to be more pronounced in services than
in goods. Services are different from goods in multiple ways that pose challenges to driving productivity
lu
and customer satisfaction at the same time. Exhibit -4 provides a summary of these differences as well as
their managerial implications.
So
Let’s focus on the challenges that are especially pertinent for health care providers:
First, health care services are often high-involvement decisions, as choice of the wrong doctor could lead
The Case Solution Starts From page 5
, EXHIBIT -4: DIFFERENCES BETWEEN SERVICES AND GOODS
e
pl
m
Sa
n
tio
lu
So
The Case Solution Starts From page 5
INSTITUTE OF GASTROENTEROLOGY HOSPITALS CASE
STUDY SOLUTION
e
pl
SYNOPSIS
m
Sa
Founded in 2012, Quadria Capital Investment Management Private Limited (Quadria Capital) was
committed to its mission of using its expertise to do well by doing good through bringing affordable quality
health care to Asia. In July 2013, it found such an investment opportunity in the Asian Institute of
n
Gastroenterology (AIG) Hospital in India. AIG was one of the largest gastric sciences hospitals in India
that specialized in gastroenterology. It performed more endoscopic procedures per day than any other
tio
hospital in the world.1 It had earned a global reputation for clinical excellence, being among only twenty
centres globally to be conferred World Organization of Digestive Endoscopy (OMED) 2 recognition. This
clinical excellence in the gastric science specialty and reputation put AIG in a strong leadership position
lu
and drove demand for its services. It was also renowned for its research and education in gastric sciences.
So
As exciting as the opportunity was, the two founders of Quadria Capital knew this investment would use
up a sizable portion of their funds, and they had to carefully consider the risks and what needed to be done
to decide whether AIG was the right investment opportunity for Quadria Capital.
OBJECTIVES
• Understand the challenges faced by service organizations in general, and health care in particular.
• Know that customer-induced uncertainty is a key challenge for achieving both service productivity and
service quality, or cost-effective service excellence (CESE).
• Learn about the advantages of a focused service factory (FSF) strategy for achieving CESE.
• Understand the operations management (OM) approach for achieving CESE.
The Case Solution Starts From page 5
, e
pl
m
Sa
n
tio
lu
So
ASSIGNMENT QUESTIONS
1. What are the challenges of driving productivity and service excellence in service organizations in
general, and in health care in particular?
2. Using a strengths, weaknesses, opportunities, and threats (SWOT) analysis, what was AIG’s situation
and positioning?
3. What were the reasons for AIG’s success and cost excellence?
4. Discuss the three issues the Quadria Capital team had to consider and suggest ways to
achieve/overcome them: (a) demand and patient throughput, (b) pricing and positioning, and (c)
expanding to comorbidities.
5. Based on its four-pillar investment strategy (see case Exhibit 5), is AIG a good investment for Quadria
Capital? Why?
The Case Solution Starts From page 5
, e
pl
ANALYSIS
m
1. What are the challenges of driving productivity and service excellence faced by service
organizations in general, and in health care in particular?
Sa
Productivity refers to the ratio of output per unit of input (e.g., labour, asset). Service excellence refers to
high levels of service that generates high customer satisfaction.
The trade-off between customer satisfaction/service excellence and productivity has been widely
n
acknowledged in the literature and remains a key challenge for organizations that strive for both objectives.
These two approaches conflict because too strong a focus on cost reduction associated with productivity
tio
can reduce customer satisfaction, and concentration on customer satisfaction is assumed to cost more,
thereby reducing productivity. Research has shown this trade-off to be more pronounced in services than
in goods. Services are different from goods in multiple ways that pose challenges to driving productivity
lu
and customer satisfaction at the same time. Exhibit -4 provides a summary of these differences as well as
their managerial implications.
So
Let’s focus on the challenges that are especially pertinent for health care providers:
First, health care services are often high-involvement decisions, as choice of the wrong doctor could lead
The Case Solution Starts From page 5
, EXHIBIT -4: DIFFERENCES BETWEEN SERVICES AND GOODS
e
pl
m
Sa
n
tio
lu
So
The Case Solution Starts From page 5
