Strategic Implications Review, Essay Example

As Abelson’s report concludes, the changes in the health care service in the United States has made some employers to apply strategic thinking and increase operational effectiveness.  GE was able to improve the quality and reduce the cost through creating competencies and capabilities. The management of the company looked at the possibility of connecting with service providers directly.  GE created medical homes, representing a higher customer value. However, only large organizations, like GE are able to take advantage of the opportunity, as they need to use their resources (researching local providers and policies) to create organizational competencies (knowledge of service level, saving, and the quality of service provided).  They can create competencies (advice on different plans for employees based on comparison) in order to deliver more value.

The initiative increased GE’s operational effectiveness. The number of visits among employees who enrolled to medical homes reduced by 3.5 percent. This indicates that companies who take advantage of a health information sharing system within these plans will be able to save resources, increase their capabilities and the operational effectiveness. When the value chain of health plan delivery will be optimized, the customer value will increase.

Strategic management is a form of organizational strategic thinking. GE’s efforts are a part of the company’s plan to create process improvements through optimizing the value chain in order to respond to the challenges of the external environment. Strategic management, on the other hand, is balancing between the company’s internal and external environment. The internal environment is the pool of employees entitled to health care plans, and the external environment is the health care system and the pool of providers offering different services.

Works Cited

Abelson, R. “As Some Companies Turn to Health Exchanges, G.E. Seeks a New Path” New York Times. Sept 26 2013. Web.