ASSIGNMENT 1, SEMESTER 1

Read the Netcare case study thoroughly to answer the questions that follow. All the
questions are based on the case study. Please ensure that you read the questions
carefully before you commence answering. In addition, please take the mark allocation
of each question into consideration when answering the questions.

Please use your own words, understanding and interpretation of the theory and
application thereof to the case.

PLEASE NOTE
No emailed submissions will be accepted.
No late submissions will be accepted.

Netcare
Netcare Limited is a South African investment holding company. They operate through several subsidiaries.
Netcare offers a unique and comprehensive range of private healthcare services and products across the
healthcare spectrum, throughout South Africa. The Netcare Group invests in growing and continually
improving their capabilities and capacity, and in partnering with the public sector in South Africa, to support
the effectiveness of the national healthcare systems in which they operate. Netcare’s continuous investment
in the latest medical technologies and high-level professional expertise and its commitment to caring for
patients, make them a leading healthcare provider.

The company’s ordinary shares have been listed on the Johannesburg Stock Exchange in South Africa
since December 1996, when the company operated four hospitals. Currently, the company has 51
hospitals, two public–private partnership hospitals, 10 605 registered hospital beds, 422 theatres, 10 cancer
care centres, 63 renal dialysis units with 860 dialysis stations, 95 primary healthcare centres, 15 Medicross

Open Rubric
day theatres, 79 Netcare 911 emergency sites, 7 training campuses, 21 763 employees, and 12 mental
health and psychiatric clinics with 841 beds.

In South Africa, Netcare operates the largest private hospital, primary healthcare, emergency medical
services and renal care networks. In addition to its world-class hospital services, the Group offers primary
healthcare, sub-acute care, day surgery, occupational health and employee wellness services
through Medicross, emergency medical services through Netcare 911, renal dialysis through National
Renal Care and mental health and psychiatric services through Akeso. Netcare also has the distinction of
being a leading private trainer of emergency medical and nursing personnel in the country.

Netcare’s core purpose is to provide the best and safest patient care. Their vision is to:

• develop and implement solutions to provide quality healthcare by inspiring their people,
encouraging innovation and optimising their operations to deliver value for all stakeholders;

• strive for consistent and excellent patient care delivered by people who are passionate about the
sanctity of life, personal respect and dignity;

• grow their investments in people, infrastructure and technology and develop lasting relationships
with healthcare professionals; and

• be a leading corporate citizen, proud of their heritage and what they contribute to society.

Netcare’s core value is care. They care about the dignity of their patients and all members of the Netcare
family. They care about the participation of their people and partners in everything that they do. They care
about truth in all their actions. They engage everyone with empathy and respond with acts of compassion in
all their interactions with patients and their families.

To attain the core purpose, Netcare’s strategy responds decisively to the changing healthcare environment
and will create sustainable competitive advantage for the Group. It reinvents how they deliver health and
care, moving away from the siloed and episodic approach typical of traditional healthcare provision. It will
enable them to provide seamless and integrated services across all their platforms, enabled by digitisation
and informed by rich data. As they accelerate its implementation over the medium term (three to five years),
they expect to achieve a care offering that is highly differentiated in South Africa, driving above market
growth, and earning enhanced returns for the Group. These are the outcomes against which all our strategic
initiatives are evaluated and measured. This process is illustrated on the next page:
 Core purpose
Provide best and safest care to patients

Netcare’s Strategy
Answers the three
global healthcare
megatrends of Leverages off Delivers person-
consumer unique ecosystem centred health
centricity, of assets and and care that is
digitization, and services digitally enabled,
data and data driven

How Netcare will achieve person-centred health and care

Digitize patient health records across Apply rich data analytics to inform
all Netcare service platforms clinical decisions and outcomes

Create a customer engagement platform that provides an interface for patients to access their health
and care data over their entire lifetime

Allows patients to take co-responsibility Longitudinal records of healthcare

for their health and wellness during periods of recovery and
wellness
Netcare’s strategy rests on six pillars, each with clearly defined objectives, plans and projects that in
combination will drive the outcomes their strategy is designed to achieve. These pillars are depicted in the
figure below and described in more detail on the following page:

Investment

Consistency of
Integration
care

Person-centred
health and
care, digitally
enabled and
data driven

Disruptive
Organic growth
innovation

Transformation
of our society
 Consistency of care
•Delivering consistently excellent clinical services, ensuring best and safest person-centred care

Disruptive innovation
•Implementing medical technologies, digitisation and data solutions for the benefits of the business and
patients driving sustainability

Tranformation of our society

•Continuing to invest in and develop their workforce and communities

Orgnic growth
•Driving strategic engagements with doctors and funders, investing to maintain the quality of their facilities and
developing new products and services to promote inclusivity and access

Integration
•Creating strategic and synergistics partnerships between all service platforms and functions

Investment
•Creating economic value and optimising capacity utlisation

Each of the above pillars is directly linked to the remuneration of employees.

Netcare ensures a balanced approach to growth, profitability and value creation for all stakeholders while
generating competitive returns for their shareholders over the long term. In South Africa, they are
implementing a systems leadership model where managers are encouraged to use their energy, ideas, and
skills to drive innovation across the organisation. Through this approach, Netcare aims to co-create a
sustainable future by finding collective solutions to operational challenges and for those in the healthcare
system they serve.

Netcare’s sustainability strategy is based on three pillars, namely, transformation, reporting on clinical
outcomes and environmental sustainability:

• Transformation: Netcare is committed to making a positive difference and the transformational

culture in Netcare is evidenced by the Group’s sustained progress in transformation. They focus
on enhancing Netcare’s black ownership and the race and gender diversity of their leadership.

• Quality of care reporting: The Netcare quality management system is designed to provide
assurance of the highest quality of care in all Netcare facilities by adopting a multi-dimensional
quality framework that includes more than 300 measures of quality.

• Environmental sustainability: Environmental sustainability is an integral part of their strategy. In

2013, Netcare received a R500 million loan from Nedbank Corporate Bank in association with the
French Development Agency, having set themselves the goal of reducing their energy intensity by
30% within 10 years. Their environmental sustainability programme focuses on ensuring a
sustainable supply of energy and water, efficiently managing the use and cost of utilities, and
 recycling and controlling waste. They have strategic partnerships with Energy Management SA and
Energy Partners and provide their employees with training and awareness on utility conservation.

Sources:

Netcare Limited. 2023. Who we are. Available online: https://www.netcare.co.za/Who-We-

Are/Sustainability/Environment [Accessed 29 April 2023].

Netcare Limited Annual integrated report 2020. Available online https://netcare-reports.co.za/2020/pdf/Our-

strategy.pdf [Accessed 9 October 2023]
 QUESTIONS

Question 1 (10 marks)

‘The Netcare Group invests in growing and continually improving their capabilities and capacity.’

Make a judgement with regards to the absorptive capacity of Netcare. In your answer, you need to explain
the meaning of absorptive capacity and apply the dimensions thereof to Netcare’s systems and processes.
(10 marks, of which 2 marks will be awarded to the explanation of absorptive capacity, and 8 marks to the
application of the dimensions thereof to Netcare’s systems and processes. PLEASE NOTE, you need to
explain each dimension first and then apply it to Netcare.

Question 2 (12 marks)

Netcare’s vision is to develop and implement medical solutions to provide quality healthcare by
inspiring their people, encouraging innovation and optimising their operations to deliver value for
all stakeholders; strive for consistent and excellent patient care delivered by people who are
passionate about the sanctity of life, personal respect and dignity; grow their investments in people,
infrastructure technology and develop lasting relationships with healthcare professionals; and be
a leading corporate citizen, proud of their heritage and what they contribute to society.

Draw a strategic map for Netcare by specifying strategic objectives for each element of the Balanced
Scorecard developed by Kaplan and Norton. (12 marks, of which 1 mark will be awarded to each element
of the Balanced Scorecard and 2 marks for the two strategic objectives for Netcare specified for each
element. PLEASE NOTE: you may present the strategic map as a table in your answer)
 Question 3 (14 marks)

The alignment between the core purpose, vision, and objectives of Netcare is vital.

Explain tools that Netcare can implement to align individual behaviour with its strategic direction. In your
answer, you need to explain these tools and then identify two examples of the application of these tools at
Netcare. (14 marks, of which 2 will be awarded to each tool correctly explained and 1 mark for each of the
two examples at Netcare)

Question 4 (12 marks)

Every business has its own unique culture.

Apply the layers of business culture to Netcare. In your answer, you need to explain each layer first, and
then apply it to Netcare. (12 marks, of which 3 marks will be awarded to the first layer, 5 marks to the
second layer, and 4 marks to the third layer)

Question 5 (14 marks)

Businesses need to assess their culture to attract and retain talent to support and implement their
strategies.

Explain an approach to assess the business culture and apply this approach to Netcare. (14 marks)
 Question 6 (8 marks)

Businesses will benefit from considering a variety of indicators that provide a dashboard of its
culture and various subcultures.

Explain any four of these culture indicators. In your answer, you need to first explain the culture indicator
and then apply it to Netcare. (8 marks).

TOTAL MARKS FOR THE ASSIGNMENT 70 marks