MAC007 - Strategic Management Accounting - Regis Healthcare Limited - Assessment Answer

Strategic Management Accounting

Instructions: Clearly write your name and student id when you submit your report. A peer evaluation sheet is required to be submitted along with the report. Only one submission per group is needed. There is no word limit. MAC007 Strategic Management Accounting Assessment 3- Assignment Trimester 3 2017 Page 1 of 2 Regis Healthcare Limited is one of the leading operator of Aged care facilities in Australia and the largest of ASX listed Residential Aged Care (RACs) with an estimated market of 2.5%. Regis works with a vision to be dynamic, innovative and a creative industry leader providing premium quality aged care services through effective management by a dedicated professional team. To achieve this, the key factor driving the growth aspirations and operational metric is the quality of care. You are a team of Strategic Management Accountants (SMA) who have been hired to help achieve the following: 1) Enhance value chain within the organisation with various strategic management tools 2) Examine and apply the techniques for developing, implementing and monitoring strategies 3) Analyze the strategic management cycle and the leadership role of professional accountants in strategic management 4) Define the role of organisation and industry value chain analysis and apply the analysis to the design and structure of value adding activities, value drivers and value chains 5) Analyze the characteristics of effective strategic and corporate social responsibility related performance measurement and control systems 6) Describe and apply strategic management accounting techniques to the selection, planning, implementation, control and monitoring of projects if any.

Introduction In any healthcare organisation, quality of care provided by that organisation is the most important and the key factor to the success of that organisation (Ferlie & Shortell, 2001). In order to understand the current quality metric of Regis Healthcare Limited and to identify other strategic options for the organisation, several strategic management tools have been used inclosing Pestle analysis and Porter's value chain model. Pestle has been used to understand the impact of industry governing forces or external forces on the functioning and operations of the organisation. On the other hand, Porter's Value Chain Model has been used to understand how operations are being performed within the Regis Healthcare Limited. Role of accountants and strategic leadership and corporate social responsibility system and control has also been discussed. Several strategic alternatives have been presented and monitoring strategies to measure the effectiveness of these strategic alternatives after implementation has also been evaluated. Porter's Value Chain Model This analysis techniques is used to identify and understand the various operational activities of the organisation that add value to the organisation (Kramer, 2011). With the use of these model, strategic alternatives are framed that are used for reducing cost and/or promoting differentiation in the products or services offered. In the following sections, value chain model has been applied to Regis Healthcare to identify it s various operational activities that add value to the services offered by Regis. Inbound Logistics The inbound logistics refers to how the product or service is transferred from the supplier to the business organisation or intuition which in this case is Regis Healthcare Limited. The main Running Head: MANAGEMENT suppliers in healthcare industry include pharmaceutical industries and research and development department specifically. Australian government spends a fortune on the medical research and it ranks 12th in the world for excellence of medical research (Palmer &Short, 2000). Along with import, a lot of medical equipments and medicines are exported from United States of America, Easter countries and other European countries too. Operations Operations refers to the process or system followed by an organisation to make the products or services available to the customers (patients in this case). In case of Regis Healthcare Limited the operations process include admission, treatment or care, discharge, follow up and evaluation of patient experience (Buttigieg, Schuetz & Bezzina, 2016). The patients contacts the Regis Healthcare and learns about different services offered by the organisation, meanwhile, the staff members learn about the patient (diagnosis etc ). The patient then avails the to what he or she thinks is the best package for him or her and treatment and care process starts. The next step is the follow up and the last stage is to evaluate the experience of the patient. Outbound Logistics Outbound logistics refers to how the goods or services are made available to the customers (Holsapple & Singh, 2001). In case of Regis healthcare limited, the healthcare services are offered to people in their homes and there are retirement villages where aged people can go and spend their time while getting full medical attention. Marketing & Sales Regis Healthcare Limited uses several marketing and promotional tools to boosts its sales figure. Social media platforms and other digital media platforms are being used by Regis to make the people aware of the services offered by the organisation and hence widen its customer base. Running Head: MANAGEMENT Service There are various services offered by the Regis Healthcare Limited which vary according to the need of the patients. These services include day therapy, home care services, retirement villages and aged care services (Regis, 2017). Quality of care is the prime concern of the business while offering these varies services. Apart from these there are supporting activities of a business too that contribute to the quality of care and profit of the business which are mentioned below: ? Firm Infrastructure: The infrastructure of the Regis Healthcare Limited is excellent ? Human Resource Management: Regis Healthcare has a pool of talented staff that enables the business to offer best quality care services ? Procurement: Medical equipments and other medical products like medicines etc are purchased by the business from several external sources ? Technology: The technology used by Regis Healthcare Limited is very advanced PESTLE This is an external environment analysis tool which is used to assess the impact of several external factors on the organisation, which in this case is Regis Healthcare Limited. Political Extensive governmental funding is provided to most of the organisations operating in the healthcare industry of Australia (Weerawardena, McDonald & Mort, 2010). This helps the organisation run smoothly and hence maintain the quality of care offered to the patients. In addition to this, community care is encouraged by the Australian government which further benefits the healthcare industry. Moreover, the government provides subsidies and rebates on medical equipments etc. Running Head: MANAGEMENT Economical The growth of the healthcare industry is predicted to be 6% for the year 2016 to 2021 which suggests that the business organisation and other healthcare institutions operating within the industry will flourish. In addition to this, Australia is a developed country with the GDP of $1.24 trillion in the year 2017 (World Bank, 2017) which suggests that purchasing power of residents is also more. It should be noted here that more the purchasing power of the people, more will be the development of an industry. Social There has been significant shift in the demography of Australia as there is a significant proportion of people who are reaching the retirement age which signifies that there will be need for better healthcare facilities for aged people (Braithwaite, 2001). This is also a plus point from the perspective of healthcare industry. Technological Australia is a technologically advanced country that uses best healthcare equipments for the patients. Almost every healthcare institution has access to best healthcare equipments, doctors and medicines that add to the quality of care received. Legal The legal environment accesses the impact of rules and regulations, government policies and laws applicable within the country on an industry. In the case of healthcare industry, government policies are very strict and there are extensive policies in facility accreditation which acts a barrier to manage change within the organisation. Environmental Running Head: MANAGEMENT Organisations operating within the healthcare industry, most of these organisations follow sustainable practices that has minimum negative effect on the environment. Company Life Cycle Analysis and Leadership Role of Professional Accountants in Strategic Management This tool enables the user to understand the stage at which the business is currently operating. There 4 stages which include introduction, growth, maturity, and decline (Penoyer, 2000). After decline, there comes another stage which is called re-invent and the company comes back to the introduction stage or there is a death stage where the company is unable to make a comeback. In the case of Regis Healthcare Limited, it has been evaluated that Regis is at the growth stage because there are still several options that could be adopted to expand the healthcare facilities and reach the maturity stage. In case of healthcare industry, it is difficult to reach the maturity stage because there is always a need of healthcare services, and in case of this organisation operating in Australia, the proportion of aged people in the total population is high too. In the growth of the business organisation, accounting professionals have played a significant role in developing and monitoring strategies. Accounting professional, from Running Head: MANAGEMENT accountants to CFO (Chief Finance Officer), play a vital role in the strategic decision making as the implementation of these decisions require funds which are managed by these professionals only (ACCA, 2017). In addition to this, accounting professionals are very much aware of the strategic alternatives available to the business that can reduce cost and maximise the profit which ultimately contributes to their leadership skills. Characteristics of Corporate Social Responsibility Related Performance Measurement and Control System and Technique to be used for Monitoring Strategies Accounting professionals helps in the reporting of sustainable practices being done by the organisation. In addition to this, these professionals also help in the preparation of annual report and allocation of fund to sustainability initiatives. Corporate social responsibility related performance measurement and control system helps in the promotion of business which ultimately results in increased profit and a larger customer base (Mersereau & Mottis, 2011). The business organisation can reduce cost by identifying alternative sources for procurement of goods. In addition to this, Regis Healthcare Limited can also focus on differentiation by improving the aged care facilities. The strategies that are being currently followed by the organisation can be developed and monitored using benchmarking technique, which is an strategic management accounting technique to measure the effectiveness of implemented strategy/strategies. Benchmarking is the process of developing set standards and then comparing actual performance with those standards and striving to bridge the gap between the two (if any). Conclusion Running Head: MANAGEMENT From the above discussion, it can be concluded that Regis Healthcare Limited offers a wide range of healthcare and aged care facilities. In addition to this, it can also be concluded that the logistics process of supplier and customer deliver y is also very effective. Moreover, it has also been found that business can focus more on research and development department in order to obtain better results (enhanced performance).