Service-Profit Chain Analysis in Healthcare Services

Abstract

Focus on service-profit chain by organizations in the service sector has been found to be of crucial importance. Companies in varied sectors like banking, airlines, restaurants and healthcare have become industry leaders by focusing on aspects of service-profit chain. This paper presents an analysis of service-profit chain in the healthcare sector. Taking two examples of hospitals from India and one from abroad this paper brings out the importance of focusing on the service-profit chain in this sector. An analysis of the practices in these hospitals, with a major focus on Aravind Eye Hospital, will give a perspective of how these hospitals have focused on the service-profit chain and made them efficient and effective and have enhanced their customers’ satisfaction. Service-profit chain analysis can help healthcare organizations to be customer focused. It can motivate organizations to develop attractive value propositions for customers. It can also provide a warning to organizations that are neglecting the interests of employees. Overall, the service-profit chain provides a useful framework for healthcare organizations in developing their strategy as well as implementing day-to-day operations.

  • Page Number : 95-100

  • Keywords
    Customer Satisfaction, Employee Productivity, Hospital Management, Service-Profit Chain

  • DOI Number
    https://doi.org/10.15415/jmrh.2018.42008

  • Authors
    Pratyush Ranjan, Peeyush Ranjan

References

  • Anand, G. (2009). The Henry Ford of heart surgery. The Wall Street Journal. Retrieved from https://www.wsj.com/articles/SB125875892887958111
  • Brown, M. J., Subramanian, A., Curry, T. B., Kor, D. J., Moran, S. L., and Rohleder, T. R. (2014). Improving operating room productivity via parallel anesthesia processing. International Journal of Health Care Quality Assurance, 27(8), 697–706. https://doi.org/10.1108/IJHCQA-11-2013-0129
  • Chicu, D., Valverde, M., Ryan, G., and Batt, R. (2016). The service-profit chain in call centre services. Journal of Service Theory and Practice, 26(5), 616–641. https://doi.org/10.1108/JSTP-10-2014-0243
  • Gelade, G. A., and Young, S. (2005). Test of a service profit chain model in the retail banking sector. Journal of occupational and organizational Psychology, 78(1), 1–22. https://doi.org/10.1348/096317904X22926
  • Ghosh, M. (2014). Measuring patient satisfaction. Leadership in Health Services, 27(3), 240–254. doi:10.1108/LHS06-2013-0027 https://doi.org/10.1108/LHS-06-2013-0027
  • Govindarajan, V., and Ramamurti, R. (2013). Delivering world-class health care, affordably. Harvard Business Review, 91(11), 117–122.
  • Heskett, J. L. (1983). Shouldice Hospital Limited. Harvard Business School Case 683–068.
  • Heskett, J. L., Jones, T. O., Loveman, G. W., Sasser, W. E., & Schlesinger, L. A. (1994). Putting the service-profit chain to work. Harvard Business Review, 72(2), 164–174.
  • Javalgi, R. G., and Moberg, C. R. (1997). Service loyalty: implications for service providers. Journal of services marketing, 11(3), 165–179. https://doi.org/10.1108/08876049710168663
  • Jones, T. O., and Sasser, W. E. (1995). Why satisfied customers defect. Harvard business review, 73(6), 88–99.
  • Joseph, W. B. (1996). Internal marketing builds service quality. Journal of Health Care Marketing, 16(1), 54–59.
  • Khanna, T., Rangan, V. K., & Manocaran, M. (2005). Narayana Hrudayalaya heart hospital: Cardiac care for the poor. Harvard Business School Case 505–078.
  • Kim, C. S., Spahlinger, D. A., Kin, J. M., and Billi, J. E. (2006). Lean health care: what can hospitals learn from a world-class automaker? Journal of Hospital Medicine, 1(3), 191–9. doi:10.1002/jhm.68 https://doi.org/10.1002/jhm.68
  • Lee, S. M., Lee, D., and Kang, C. Y. (2012). The impact of high-performance work systems in the healthcare industry: employee reactions, service quality, customer satisfaction, and customer loyalty. The Service Industries Journal, 32(1), 17–36. https://doi.org/10.1080/02642069.2010.545397
  • Lovelock, C., Wirtz, J., and Chatterjee, J. (2006). Marketing of services, people, technology, strategy (5th ed.). Pearson Education.
  • Panjakajornsak, V. (2009). Applying the service profit chain to a private hospital in Thailand. NIDA Development Journal, 49(2), 81–107.
  • Rangan, V. K. (1993). The Aravind eye hospital, Madurai, India: in service for sight. Harvard Business School Case 593–098.
  • Rangan, V. K. (2004). Lofty missions, down-to-earth plans. Harvard Business Review, 82(3), 112–119.
  • Rangan, V. K. (2007). Aurolab: Bringing First-World Technology to the Third-World Blind. Harvard Business School Case 507–061.
  • Rangan, V. K., and Thulasiraj, R. D. (2007). Making Sight Affordable. Innovations Case Narrative: The Aravind Eye Care System. MIT Press, 1(3), 35–49. doi:10.1162/itgg.2007.2.4.35 https://doi.org/10.1162/itgg.2007.2.4.35
  • Schlesinger, L. A., and Heskett, J. L. (1991). The service driven service company. Harvard Business Review, 69(5), 71–81.
  • Shah, J., and Murty, L. S. (2004). Compassionate, high-quality health care at low cost: The Aravind model; in conversation with Dr G Venkataswamy and RD Thulasiraj. IIMB Management Review, 16(3), 31–43.
  • Steinke, C. (2008). Examining the role of service climate in health care. International Journal of Service Industry Management, 19(2), 188–209. doi:10.1108/09564230810869739 https://doi.org/10.1108/09564230810869739
  • Teng, C. I., and Hsu, W. H. (2012). The Impact of Health Service Provider Agreeableness on Care Quality Variation. Service Science, 4(4), 295–307. https://doi.org/10.1287/serv.1120.0018

  • Published Date : 2018-04-02