PEST and SWOT analysis of the NHS
Healthcare in England is mostly provided by England's public health service, which is known as the National Health Service (NHS) that provides healthcare to all permanent residents of the England that is free at the point of use and paid for from general taxation. There are differences with the provisions for healthcare elsewhere in the England. Though the public system dominates healthcare provision in England, private health care and a wide variety of alternative and complementary treatments are available for those willing to pay. The NHS provides the majority of healthcare in England, including primary care, in-patient care. The National Health Service Act 1946 came into effect on 5 July1948 (NHS website). Private health care has continued with NHS, paid for largely by private insurance, but it is used by less than 8% of the population. Recently there have been some examples where unused private sector capacity has been used to increase NHS capacity and in some cases the NHS has commissioned the private sector to establish and run new facilities on a sub contracted basis. Some new capital programs have been financed through the private finance initiative. The involvement of the private sector remains relatively small yet.
The NHS is divided into two parts, primary and secondary care with trusts given the task of health care delivery. There are two main roles of trusts in the NHS reflecting purchaser/provider roles: commissioning trusts are responsible for examining local needs and negotiating with providers to provide health care services to the local population, and provider trusts which are NHS bodies delivering health care service. Commissioning trusts negotiate service delivery with providers that may be NHS bodies or private entities. They will be involved in agreeing major capital and other health care spending projects in their region. Services including general practice physician services community nursing, local clinics and mental health service. For most people, the majority of health care is delivered in a primary health care setting. Provider trusts are care deliverers, the main examples being the hospital trusts and the ambulance trusts which spend the money allocated to them by the commissioning trusts. Because hospitals tend to provide more complex and specialized care, they receive the lion's share of NHS funding. The hospital trusts own assets (such as hospitals and the equipment in them) purchased for the nation and held in trust for them. Commissioning has also been extended to the very lowest level enabling ordinary doctors who identify a need in their community to commission services to meet that need. Primary care is delivered by a wide range of independent contractors such as GPs, dentists, pharmacists and optometrists and is the first point of contact for most people. Secondary care (sometimes termed acute health care) can be either elective care or emergency care and providers may be in the public or private sector, though the majority of secondary care happens in NHS owned facilities.
PEST Analysis for NHS
PEST stands for Political, Economic, Social and Technological. It is a strategic planning technique that provides a useful framework for analysing the environmental pressures on a team or an organisation. A PEST Analysis can be particularly useful for groups who have become too inward-looking. They may be in danger of forgetting the power and effect of external pressures for change because they are focused on internal pressures (Rogers 1999). We can use this technique for a large or a small group activity.
The Trust National Health Services (NHS) is developing its governance arrangements to strengthen partnerships and engage local authorities with the Trust. The National Health Services is involved in that process to ensure that their role as the main provider of hospital services is reflected in the planning arrangements for the new authority. Also, periodic changes in political balance in local authorities’ leads to uncertainty as priorities change to reflect differing political policies. Strengthening partnerships in local area augmentation systems and local strategic partnership systems and other mechanisms that support long term joint planning will help address this. The current Developing Health and Health Care strategic review will have an impact on the configuration of National Health Services (NHS) across England’s catchment’s, with the potential for tensions between Telford and Shropshire in the development of options for service configuration. An open and comprehensive engagement and decision-making process is in place.
The key issues in economical forces of National Health Services include changes to the NHS financial regime including movement to payment by result, introduction of Practice Based Commissioning and restricted access to capital. New freedoms under National Health Services Foundation Trust status will allow for new business partnership opportunities which will help maximise economic opportunities. Also the Trust needs to move to improved outcome-based decision making so that investment is focused on areas of greatest benefit which are clinical quality, patient need and market etc. In common with all National Health Services organisations are currently faced with increasing fuel and food costs. National Health Services should take initiatives such as Combined Heat and Power scheme to reduce their carbon footprint help to address this problem.
According to social responsibilities National Health Services look after Patient choice, changing expectations and demographic changes very actively. The NHS
Trust still needs to increase its marketing in the context of choice, including strengthening horizon scanning for example planning for future population change etc. The rural nature of England’s western catchments presents challenges in recruiting specialist staff, so National Health Services need to enhance and promote the role of the Trust as an excellent employer to enable and fulfil their service development aspirations. Public activism is also increasing but there are opportunities to see these as an opportunity rather than a threat as National Health Services develop their membership engagement strategies for National Health Services Fund Trust status.
As the technology is concern National Health Services has new information and communications technologies which present opportunities for strengthening diagnostic capability, including remote services. National Health Services need to support workforce development to make use of new technologies. The NHS is faced with a growing number of new and expensive treatment and diagnostic technologies, backed by commitments in the draft NHS constitution about primary care trust decision-making when new treatments arise. National Health Services planning processes will need to support them to make the best decisions about the introduction of new technologies into the Trust, particularly where there is not a clear income stream from commissioners.
Five Forces of Porter’s Model for NHS
The Porter’s Five Forces tool is a simple but powerful tool for understanding where power lies in a business situation. This is useful, because it helps you understand both the strength of your current competitive position, and the strength of a position you’re looking to move into. With a clear understanding of where power lies, you can take fair advantage of a situation of strength, improve a situation of weakness, and avoid taking wrong steps (Porter). This makes it an important part of your planning toolkit. Conventionally, the tool is used to identify whether new products, services or businesses have the potential
Here we are going to have a look on forces which can have effect on the services of National Health Services in both ways negatively and positively. First of all we will discus the suppliers of National Health Services who has a vital role in NHS services.
National Health Services Supply Chain providing is an effective and efficient procurement service. Suppliers of NHS aim to continually improve the service by decreasing purchasing costs and increasing the value available through the national framework agreement. As a result NHS Supply Chain encourages suppliers to approach relevant buyers with ideas and proposals for enhancing the product offering throughout the term of the agreement. National Health Services have good control over its supply chain and suppliers.
National Health Services is a national fund trust which provide services to the public of United Kingdom for free. NHS has less threat of losing customers because it provides good services to its customers for free and has their service points in almost every area of the country. As NHS has a very vital role in the health sector of the United Kingdom it needs to be up to date regarding technologically and socially, to maintain and retain the trust of the buyers (public of the United Kingdom) of the organization. It is very essential to maintain and retain the trust of the customers for the National Health Services.
There are not too many competitors of National Health Services in the industry. NHS has the competition from the private hospitals. The private hospitals are growing in England and becoming the competitors of National Health Services. In a sense National Health Services have a big advantage upon its competitors, because NHS provide free services to its customers where as its competitors private sector charges its customers for the services they provide. So this is a big advantage for National Health Services on its competitors, but still National Health services have a doubt from its competitors on long term basis.
If we take a look on the substitute of the National Health Services, in short term NHS has no or less substitutes. As we know that NHS is a National fund trust which provides free services to the public of England. There is no other trust in the England which provides the same services for free as NHS provides. So this is a big advantage for National Health Services to carry on their running strategies for the short term as they don’t have any fear from the close substitute in the market.
Power is also affected by the ability of private hospitals to enter the market of health sector for the National Health Services. Though it costs high in time or money to enter the health sector and compete effectively, but still there are few economies of scale in place. National Health Services have high protection for its key technologies, so that new competitors can not quickly enter in the market and weaken NHS position. National Health Services has strong and durable barriers to entry, so it can preserve a favourable position and take fair advantage of it in the health sector.
Driving forces and their impact on NHS
The dual pressure of increased numbers of elderly and an increasing population in general will continue to exert tremendous stress on National Health care System. As the population of United Kingdom has grown with every passing day. Such growth requires more physicians, nurses, and other health care providers just to keep pace with service demands. It is also important to note that a substantial share of total health care spending goes not only for acute care, such as trauma victims and certain newborns, but chronic health conditions as well. Ongoing chronic care for conditions such as asthma and diabetes diseases on the rise is placing continuing demands on the health care system. Medical director members plan recently sponsored a forum on enhancing chronic care management, and actively participate in related community-wide efforts (NHS website).
Medical technology is also a major driver of National Health Services. Technological advances are unquestionably providing important break through in saving lives and improving care, but they come with significant cost. Medical technology market encompasses a wide range of innovations, led by diagnostic imaging, cardiovascular procedures, and laboratory diagnostic tests. New technology often increases health care costs, even if it succeeds in lowering the unit cost of service. For example, several new procedures are revolutionizing care for heart disease. As a result, many cardiac procedures are now done without a hospital stay and with lower risks, thus increasing their availability to patients. The greater availability, however, greatly increases the number of times they are used each year. In other instances, new technologies may offer only marginal improvements over existing treatments, but with dramatically higher price tags.
Dramatic increases in the cost increase of use and demand for prescription drugs directly affects the services of National Health Services. Over the last ten years, government’s spending on prescription drugs in National Health Services. Consumer’s share of paying prescription drug expenditures “out-of-pocket” decreased. Three main factors are driving this dramatic increase in prescription drug costs more prescriptions being written, price inflation, and a shift towards use of higher-cost drugs. Promotional spending by pharmaceutical companies has grown dramatically. On the positive side, the increased use of generic drugs provides an opportunity for slowing the growth in costs, while preserving health care quality.
Increasing government regulations and new mandates are also contributing in the strategies of National Health Services. There are literally hundreds of state statute and code regulations, and hundreds of more contract compliance requirements for those participating in National Health Services programs. Requirements are often highly complex and overlapping, and in some cases, contradict each other. This regulatory environment creates an administrative burden for NHS, which impacts premium costs, but delivers little value to consumers.
SWOT Analysis for NHS
In its simplest form, a SWOT analysis can be understood as the examination of an organization's internal strengths and weaknesses, and its environments opportunities, and threats. It is a general tool designed to be used in the preliminary stages of decision-making and as a precursor to strategic planning in various kinds of applications (Johnson et al., 1989; Bartol et al., 1991). An understanding of all external factors, (threats and opportunities) together with an internal examination of strengths and weaknesses assists in forming a vision of the future.
National Health Services has many strengths, including its very competent employees its strategies etc. National Health Services has clear strategic plan to drive organization forward. NHS has very good strategies to provide services to its customers. They have clear vision and NHS focus on its need to provide good services to the public of England. National Health Services has a strong sense of organisational drive and determination. It is very determine and focused in its field. National Health Services has very strong communication links with its customers and with in the organization. National Health Services has good understanding from its stakeholders about the success of its all projects and also its running services and projects as well.
The weaknesses of National Health Services includes that its Capacity may be insufficient when mapped against what they need to do for both commissioning and provider. National Health Service is not providing all facilities to its customers at all its branches. Some branches are very much rich with new technology where as some branches has less technology. This is not fare because every customer pays almost equally to NHS in the sense of tax. There are some gaps in the communication with in the organization is also a weakness for National Health Services.
National Health Services has opportunities in the market to increase and maintain its customers. NHS has top quality doctors and other labour to compete in the market and to provide best services to its customers that is public of England. National Health Services also deliver effective campaigns and information which cause change in behaviours to help improve health and reduce health inequalities in the England. NHS also tries to update people so they can become experts in their own care. NHS also has a quality of local health services which provides good health services to its customers at the door step. NHS is also developing world class communication skills across the organisation.
National Health Services has some threat as well in its market. NHS is not being able to move beyond the communications ‘basics’ e.g. reactive media, corporate publications. Inability to protect the National Health Services brand resulting in worsened perception of NHS services. National Health Services has not realised the Ability to maximise value through joint working. National Health Services has Poor credibility with public and stakeholders.
In the end we can say that though National Health Services is a very strong foundation it still need some changes to become stronger and better for its customers. As we know that National Health Services has many strong points like, National Health Services has clear strategic plan to drive organization forward. NHS has very good strategies to provide services to its customers. They have clear vision and NHS focus on its need to provide good services to the public of England. National Health Services has a strong sense of organisational drive and determination. NHS has top quality doctors and other labour to compete in the market and to provide best services to its customers. National Health Services also deliver effective campaigns and information which cause change in behaviours to help improve health and reduce health inequalities in the England. NHS also tries to update people so they can become experts in their own care.
National Health Services also restricted by some forces to make its way better. These forces are that, The National Health Services is involved in that process to ensure that their role as the main provider of hospital services is reflected in the planning arrangements for the new authority. Also, periodic changes in political balance in local authorities’ leads to uncertainty as priorities change to reflect differing political policies. National Health Services include changes to the NHS financial regime including movement to payment by result, introduction of Practice Based Commissioning and restricted access to capital. National Health Services need to support workforce development to make use of new technologies. National Health Services planning processes will need to support them to make the best decisions about the introduction of new technologies into the Trust, particularly where there is not a clear income stream from commissioners.
National Health Services also has some weaknesses like; National Health Service is not providing all facilities to its customers at all its branches. Some branches are very much rich with new technology where as some branches has less technology.
So National Health Services needs to improve some above mentioned weak points to make its operations more effective fore its customers and stake holders.
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