Health Administration Press Strategic Analysis for Healthcare Chapter

Health Administration Press Ansoff Matrix • The Ansoff matrix can be used to –

Health Administration Press Ansoff Matrix • The matrix considers products or services in comparison

Health Administration Press New Ansoff Matrix Market Development Diversification (Risk = moderate) (Risk =

Health Administration Press Market Penetration • The bottom left box represents strategies aiming to

Health Administration Press Market Development • The top left box represents strategies aiming to

Health Administration Press Product Development • The bottom right box—labeled “product development” —involves developing

Health Administration Press Diversification • The top right box—“diversification”—is the box with the highest

Health Administration Press Ansoff Matrix • To use the Ansoff matrix, lay out the

Health Administration Press Exercise • Break into groups and use the space on page

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Health Administration Press Ansoff Matrix • The Ansoff matrix can be used to – categorize an existing strategy, – determine the risk associated with a new or proposed strategy, or – develop new strategies. • For our purposes, we will focus on the matrix as a strategy development tool. Copyright © 2016 Foundation of the American College of Healthcare Executives. Not for sale.

Health Administration Press Ansoff Matrix • The matrix considers products or services in comparison to the markets the company proposes to serve. • The matrix compares these factors on the basis of whether each is new or existing. • Markets are placed on the vertical axis, and products and services are placed on the horizontal axis. • The intersection of these axes creates four possible blocks. Copyright © 2016 Foundation of the American College of Healthcare Executives. Not for sale.

Health Administration Press New Ansoff Matrix Market Development Diversification (Risk = moderate) (Risk = high) Market Penetration Product Development (Risk = low) (Risk = moderate) Existing Markets Existing New Products and Services Copyright © 2016 Foundation of the American College of Healthcare Executives. Not for sale.

Health Administration Press Market Penetration • The bottom left box represents strategies aiming to provide existing products to existing markets. • Such strategies are considered “market penetration” because they involve driving existing products deeper into existing markets. • A company’s efforts in this area may seek to attract new customers, but they are still within the same overall market. • Market penetration is the least risky box on the grid: The company already knows its products, services, and customers. Copyright © 2016 Foundation of the American College of Healthcare Executives. Not for sale.

Health Administration Press Market Development • The top left box represents strategies aiming to provide existing products to new markets. • Strategies of this type are considered “market development” because they involve driving existing products into markets that are currently unserved by the organization. • These are moderate-risk strategies because the organization knows its products but the market is new. Copyright © 2016 Foundation of the American College of Healthcare Executives. Not for sale.

Health Administration Press Product Development • The bottom right box—labeled “product development” —involves developing new products for existing markets. • An organization typically knows its market and patients/customers well, and it may have insights as to what the market’s unmet needs are. The organization may then create new products or services to meet these needs. • Developing a new product for an existing market is a moderate-risk proposition: The company knows its customers well but is developing a new product. Copyright © 2016 Foundation of the American College of Healthcare Executives. Not for sale.

Health Administration Press Diversification • The top right box—“diversification”—is the box with the highest risk, because the organization is creating new products for new markets. It is essentially approaching a double unknown. Copyright © 2016 Foundation of the American College of Healthcare Executives. Not for sale.

Health Administration Press Ansoff Matrix • To use the Ansoff matrix, lay out the four-box grid format and brainstorm specific strategies that correspond to each box. • For example, begin with new products for existing customers. What are the needs of your existing market and customers? • Try to identify at least five possible strategies to address bringing new products to existing customers. • Repeat this process for the remaining three boxes. • If you successfully brainstorm a large number of ideas, pick the top five for inclusion in each box. Copyright © 2016 Foundation of the American College of Healthcare Executives. Not for sale.

Health Administration Press Exercise • Break into groups and use the space on page 153 of your book to develop strategies for each box of the Ansoff matrix. Copyright © 2016 Foundation of the American College of Healthcare Executives. Not for sale.