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Situational and Decision Analysis

Situational and Decision Analysis. Mark Adamick Lynsey Cross James Onisk Kate Pacelli Kristin Rezek. Strategic Issue. The Community Blood Center of the Carolinas is encountering financial difficulties as it struggles to remain open as a non-profit, independent community blood center.

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Situational and Decision Analysis

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  1. Situational and Decision Analysis Mark Adamick Lynsey Cross James Onisk Kate Pacelli Kristin Rezek

  2. Strategic Issue The Community Blood Center of the Carolinas is encountering financial difficulties as it struggles to remain open as a non-profit, independent community blood center. As a result of few donations, increasing cost of collection and processing, and a highly competitive service area and category, the CBCC is unable to independently meet the demand of blood units for local hospital partners and remain profitable.

  3. Service Area Highlights • Fixed facility centrally located and easily accessible • Mixture of urban and rural counties • Largest population, most densely populated, and fastest growing • Younger, wealthier, higher educational attainment • Large population of African Americans (29.1%), growing Hispanic population (9.2%) • Major employment hub and concentration of colleges and universities • Cancer and heart disease leading CODs • Higher than average rates of HIV/AIDS Map Source: US Department of Housing and Urban Development Office of Policy Development and Research. (2007). Comprehensive Housing Market Analysis: Charlotte, North Carolina – South Carolina.

  4. Competitor Highlights American Red Cross Plasma Centers Distribution: Mostly collect plasma for pharmaceutical development Locations: Charlotte, Winston-Salem, Greensboro, Columbia Donation Time: First time donors 2 hours; repeat donors  ~1 hour Donor Attraction: Cash incentives • Brand: Regional leader in blood collections for seven straight years • Access: Has six collection sites in and around the CBCC service area and thousands of blood drives per year • Price: Charges local hospitals $200 per unit • Negative publicity

  5. Critical Success Factors • Access Points • CBCC (1 facility + mobile van); ARC (5 facilities + mobile van); Plasma Centers (1-2 facilities each); Local Hospitals • Geographic Location Demographics • College students; 35-44 year olds; 55-64 year olds • Donor Attraction • Money (plasma centers) vs. Lotto Tickets (ARC+CBCC) • Donations Per Year

  6. Financial Highlights • Net Losses • 2002 Total Losses: ($2,643,414) • 2003 Total Losses: ($1,440,964) • 2004 Total Losses: ($131,758) • Insufficient Data on Blood Product Profitability • Purchased Blood Products (% of Expenses) • FY2003 $5,540,672 (59%) • FY2004 $10,053,588 (75%) • Cash Flow Problems (<1 Day Cash on Hand) • Low Marketing Budget (<1% of Expenses)

  7. SWOT Matrix Strengths Weaknesses Poor brand strength in service area Reduced budget for marketing and public relations Low market share and penetration Only one fixed collection facility Not profitable Low cash flow Negative fund balance Unused and costly equipment due to low volume No cash incentives for donors Pricing of blood is too low • Lower cost to hospitals than Red Cross • Strong hospital partners • Member of America’s Blood Centers (ABC) • Collected blood stays in community • Accreditation by American Association of Blood Banks • New choice for donors in service area • Location in Charlotte is highly populated with college students, 35-44 year olds, and 55-64 year olds

  8. SWOT Matrix Opportunities Threats American Red Cross entrenched in market American Red Cross has longstanding sponsors Plasma centers offer cash incentives Plasma centers compete for target population Decrease in able donors Increase reliance on processing technology Increase cost of blood collection • African Americans represent large percentage of population • Hispanics represent a growing portion of the population • Aging population • Increasing total population • Younger population present at local universities • Expanding to Winston-Salem and Greensboro North Carolina and Columbia, South Carolina as secondary services areas • Local hospitals, yet to partner with • Increasing cost of blood for hospitals • Demand exceeds blood collection

  9. Decision Analysis

  10. Directional StrategiesMission • Current Mission: To provide local control of the blood supply, ensuring that local needs are met first • New Mission: To provide safe and efficient blood donation services for community members, and providing blood at a low cost to local hospitals in order to keep blood donations within the community

  11. Directional StrategiesVision • New Vision: To become the supplier of choice for safe and reliable blood products within our community

  12. Directional StrategiesValues & Goals • Values: • Stewardship of the blood supply • Cultural awareness and sensitivity • Accountability of our quality • Customer focused • Goals: • Collect high volume of blood to increase revenues and profitability • Provide safe & reliable blood at an affordable cost • Optimize the donor market • Provide high-quality customer experience to donors and sponsors

  13. Adaptive Strategies TOWS Matrix SPACE Matrix • Internal Fix-It Quadrant • Internal weaknesses prevent CBCC from exploiting opportunities • Low market share • Reduced marketing budget • Lack of financial resources

  14. Adaptive Strategies • Enhancement & Market Development • Enhancement: • Improving efficiency of blood collection and operations to reduce costs • Market Development: • Marketing to target populations • Developing and positioning a brand in relation to strong competitors

  15. Market Entry StrategyInternal Development • Organizational Goals • High initial control over production, marketing, and design of products/services • External conditions • Federal Regulations • Internal Resources, Competencies, and Capabilities • Marketing competency • Operational capacity • Product/Service management expertise • Technical expertise

  16. Strategic Posture and Positioning • Posture • Analyzer (Defender + Prospector) • Defender (Focus on cost control and preservation of current market share) • Prospector (Expand blood collection into new markets) • Positioning • Low-cost Leader • Focus (10 Hospitals)

  17. Value-Adding Service Delivery Strategies: Pre-Service • Pricing • Increase price of blood temporarily • Target Market • College-aged • All markets • Branding • Develop comprehensive strategic marketing plan (using ABC resources) • Expand marketing/PR budget • Assess current media and marketing channels • Create Style Guide to provide consistent brand image

  18. Value-Adding Service Delivery Strategies: Point-of-Service Marketing (Customer Satisfaction) & Clinical Operations (Quality) • Create training plan for new and current staff on customer service requirements to maximize positive experiences • Create, communicate, and continuously review standard procedures for adverse reactions and deferrals • Streamline blood drive operations to ensure timely appointments

  19. Value-Adding Service Delivery Strategies: After-Service • Donor Follow-Up • Pre-schedule blood drives and notify donors when they are next eligible for donation • Communicate convenience of donating through fixed site • Develop plan for on-going communications with donors • Initiate a call-back program (first-time donors & donors with adverse reactions) • Contact deferred donors when deferral period ends • Continuously thank donors and sponsors • Develop programs in conjunction with sponsors to recognize repeat donors

  20. Value-Adding Support Strategies: Culture • Publish & distribute revised directional strategies • Initiate weekly staff meetings to review issues & recognize staff for exemplary service • Build direct lines of communication between staff & management

  21. Value-Adding Support Strategies: Strategic Resources • Financial • Monitor costs and blood prices • Larger marketing/PR budget • Investigate low-cost options to meet goals (interns, volunteers) • Maximize ABC membership benefits • Identify and assess potential new revenue streams • Human Resources • Hire Marketing Director specializing in non-profit & diverse markets • Training programs on diversity and cultural competence • Bilingual staff preferred • Monitor staffing level in relation to donation & processing volume • Information Systems & Technologies • Monitor use of equipment and management of leases • Maintenance and replacement plans for technology and equipment • Integrated Blood Bank Information System1 • Donor/Sponsor Relationship Management System (est. cost: $40,000)2 1. LifeSouth Community Blood Center, Inc. (2009). 510(k) Summary: IBBIS Version 2.0. Retrieved from http://www.fda.gov/downloads/BiologicsBloodVaccines/BloodBloodProducts/ApprovedProducts/SubstantiallyEquivalent510kDeviceInformation/UCM199301.pdf. 2. Suncoast Community Blood Bank. (2009). 2009 Report to the Community. Retrieved from http://scbb.org/aboutscbb/SCBBAnnual_Reportweb.pdf.

  22. Questions? Photo Source: http://www.savealifenow.org/_pdf/CBC_2007_annual_report.pdf

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