Report on the case

"Shouldice Hospital Limited"

Submitted in partial fulfilment of course:

Operations Management

Submitted by:

Ankit Nath - P21078

Deepti Sharma - P21088

Pragya Chawla - P21102

Reyansh Phadiyal - P21106

Sanjay Prajapat - P21110

Date of submission:

11 January 2022
Introduction: Shouldice hospital provides external hernia treatment for local and out-of-town patients at
its Thornhill based hospital facility. Their competency lies in facilitating early ambulation through the use
of local anesthetics and special operating procedure called ‘The Shouldice Method’. Shouldice also
differentiated itself in the patient experience it offered along with the staff experience and thoughtful
employee policies. It currently has a capacity of 89 beds and patients stay for an average time period of 4
days.

PFD and Utilization:

Patients arriving at the hospital per day = 30 to 35
Average Patients arriving each day = 30+35/2 = 32.5 ~ 33
Exams per room = Total time available for examination (from 1:20 to 3:40)/Time taken to examine one
patient (20 mins)
= 140 mins/20 mins
=7
Number of Exam rooms = 6
Exams per day = 7 * 6 = 42
Number of Patients eligible for operation assuming 10% are send back home = 90%*42 = 37.8 ~ 38
Total hours in a day/surgeon = (From 7:30AM - 4PM) = 8.5hrs

Utilization(Surgeon rostered for Morning) = 5/12 (as at most 5 surgeons can work at a time(given 5
OT rooms)) = 41.6%

Utilization(Surgeon rostered for Afternoon) = 5/6 (as many of 6 surgeons not scheduled to operate in
the afternoon) = 83.3%
Current Throughput:

Surgeon:

Coffee
7:30-8:15 8:30-9:15 9:30-10:15 Break 10:45-12:15 Lunch 1:00-1:45 2:00-2:45 3:00-3:45
Surgeon
rostered for
Morning Surgery-1 Surgery-S2 Surgery-S3 Surgery-S4
Surgeon
rostered for Surgery- Surgery- Surgery-
Afternoon S1 S2 S3

Given the above model of rostering subjected to the OT room constraints and the number of surgeons, the
total number of surgeries performed/day is:

Number of Surgeries = Number of surgeries performed by one surgeon * Number of OT rooms

Surgeries performed before lunch = 4 * 5 = 20

Surgeries performed after lunch = 3 * 5 = 15, but here we also need to consider the number of recurrence
surgeries. Thus 15 - 10%(Rate of recurrence)*15 = 15 - 1.5 = 13.5 ~ 13

Total Surgeries per day = 20 + 13 = 33

Beds:

Check-in / Beds Mon Tue Wed Thr Fri Sat Sun Total
Mon 33 33 33
Tue 33 33 33
Wed 33 33 33
Thr 33 33 33
Fri
Sat
Sun 33 33 33
Total 66 99 99 99 66 33 33 495
Bottleneck

As seen from above, the number of surgeries performed/day = 33, which creates a demand of 99 beds on
Tuesday, Wednesday and Thursday. This exceeds the current bed capacity of 89.

Problem Statement

● High demand and increase in the backlog, thus a need to increase the capacity of the hospital
while maintaining the quality of the hospital’s services delivered.
● Selection of the next chief surgeon after Dr Obney once he retires as currently he is 65. Dr Obney
is also resisting change, opposing Saturday operating program
● Control the use of Shouldice name by competitors as some physicians claim to be using
techniques but done achieve good results
● How should Shouldice market their services and how to capitalize on the fact that 1% of their
patients are doctors
● Improve admitting procedure incorporating extensive computerization

Profit analysis

Assumptions:
1. Average patient stay= 3 days
2. Total operations per year = 52*158 = 8216 (158 is assumed no. of operations per week with 145
being the minimum no. of operations in a week & 165 being the maximum)
3. Proportion of general anesthesia cases = 20%
Option analysis:
1. Perform operations on Saturday:

New annual operation capacity = 8216 x 20%= 9859

Increase= 9859-8216= 1643
Will be sufficient to clear the current backlog of 1200 patients. Same bottlenecks remain as no. of
surgeons & OTs would continue to be underutilized.

2. Expand beds by 50%

New bed capacity= 89 x (1.5) = 134

Currently needed bed capacity = 99
No. of people that can be operated after capacity increase = 134/3 = 44/day
Increase in no. of operations per year = (44-33)x 5 x 52 = 2860
Investment (one time) = $2000000
New profit = $ 3273816
Fully utilization of OT rooms = [0.82*n*45+0.18*n*90=8.5*60] where n = no of patients/OT Room
= 45 patients/day

Capacity will be fully utilized. Currently OTs & surgeons are underutilized and as per full utilization
estimates 45 patients can be operated per day. Therefore no bottlenecks in this recommendation.

Recommendation

● Increase one floor to expand the bed capacity by 50% so that the number of OTs & surgeons can
be utilized to full capacity with an operation limit of 44 per day.
● Diversify to locations in the United States as 42% out-of-town patients are arriving from the USA
● Hire & train more surgeons to treat the increased operation load after bed capacity expansion.