Focus, scale and innovation: strategic transformation in elder care

A regional VVT organization, with multiple inpatient care locations and a small outpatient care unit, was facing a strategic crossroads. Increasing investment pressure, limited scale and challenges in staffing and real estate made the existing strategy vulnerable. The organization had to choose: is the current vision of the future still feasible and can it do this independently?

Reason

Insufficient profitability in healthcare operations
Limited scale in home care and rehabilitation
Personnel challenges such as high absenteeism rates and a tight labor market
Substantial backlog of real estate investments calling for action
Societal developments with seniors wanting to live at home longer, creating alternative care needs in both inpatient and outpatient care

Approach JBR

By using the JBR Quick Scan, the VVT organization got a quick insight into the current state of affairs in an analytical and pragmatic way, taking into account the strategic vision and the people in the organization. The Quick Scan showed the need to take targeted action for a sustainable future.

The following steps were then jointly completed:

The input from interviews and working sessions allowed the organization's preconditions and goals to be identified.
Several strategic options have been formulated to achieve goals within the boundary conditions.
Each strategic option was then translated into a financial scenario using the organization's key value drivers. These strategic options were evaluated for both stand-alone scenarios, in collaboration with a strategic partner or a financial investor.
The financial scenarios were compared on several KPIs, financial robustness and future-proofing.

Scale where it needs to be, autonomy where it can be

Result

The organization's marginal results meant that the autonomous scenario was not a realistic option. The necessary investments could not be borne autonomously, and the risk of continuity problems was high. Therefore, since the quality of care is the highest priority in a case such as this, cutting costs is also not an option. The organization was presented with the following results of the strategic study:

An autonomous scenario proved too risky. The organization was insufficiently robust financially and operationally and could no longer bear the required real estate investments
Integral merger of both inpatient and outpatient care as preferred option: An integral merger, aiming to continue as one organization, offered the most qualitative and financial benefits. Synergies in care operations, overhead and investments ensure a healthy balance between profitability and investments. More clout is created for innovation, a more attractive labor market proposition and better prospects for employees.
Risks to consider regarding an integral merger: cultural differences, control and guarding the vision require attention and mitigation. Competition law issues should also be reviewed before proceeding with the merger.

JBR advised to look for a strategic partner for an integral collaboration. This partner will mainly complement the extramural part of the services.

Relevance for you

This case shows that strategic optimization in healthcare is not just about cost savings, but primarily about creating focus, scale and agility. A new strategy can make the organization future-proof, provided risks are properly mitigated and the vision remains central.

Most important lesson

Strategic optimization only works when strategy, operations and culture are addressed simultaneously and aligned. A merger offers the most benefits, but requires careful process management, stakeholder engagement and guarding the organization's core values.

Quick Scan: direct insight into your position

Do you also want to know if your organization is ready for the future? With our VVT Quick Scan we map out quickly and at a fixed rate whether your organization is on track, or if actions are needed. If actions are needed, we are happy to help you figure out which steps are most appropriate for your situation.