KAZIAN GLOBAL SCHOOL OF BUSINESS MANAGEMENT

MARKS: 80 COURSE: EMBA Sem-II

SUBJECT: Operation Management

Name: Tiwari Bishwaiswar Prasad Prem Ballabh Reference Number: KH-00612-11127 Note:- 1) Kindly write case study number question number properly 2) Attached question papers with answer sheets _____________________________________________________________________________ SECTION A

Case – 1 Marks- 20 Dr. Govinda Venkataswamy (fondly called Dr. V) founded the Aravind Eye Hospitals in 1976 with an 11-bed facility in Madural, which performed all types of eye surgeries. Its goal was to offer quality care at reasonable cost. In 1978, a 70 bed free hospital was opened to provide the poor with quality care. In 2004, Aravind Eye Care System comprised Eye Care Facilities at Madural, Theni, Tirunelveli, Coimbatore and Pondicherry (Exhibit 1) and performed nearly 230,000 eye surgeries and handled 1,640,000 outpatient visits (Exhibit 2). It is recognized as the world’s most productive eye hospital handling the largest patient volume. Its website states that ‘with less than 1% of the country’s ophthalmic manpower, Aravind accounts for 5% of the ophthalmic surgeries performed nationwide”. Its mission has now become to “eradicate needless blindness by providing appropriate, compassionate and quality eye care for all”. Each day, across all five Aravind Eye Hospitals, about 4481 outpatient visits are handled, about 627 surgeries take place and about three camps are conducted. Currently, there are more than 20 million blind people in India and only over four million surgeries are performed every year. Over 75% of the blindness is due to cataract. Cataract is the clouding of the natural eye lens due to ageing or otherwise. There are two types of cataract surgeries: one in which the natural lens is removed and then glasses are provided after three to four weeks, called intracapsular surgery (ICCE) and the other where after removing the natural lens, the intraocular lens inserted, called extra capsular surgery or ECCE. In ECCE, patients normally do not require corrective lenses after the surgery. ECCE is better and often preferred because the quality of the restored sight is distortion-free and near natural. However, ECCE is slightly expensive due to the cost of the intraocular lens. Talking to a Harvard Business School professor, Dr.V argued, “Tell me, can a cataract surgery be marketed like hamburgers? Don’t you call it social marketing or something? See, in America, McDonald’s and Dunkin’ Donuts and Pizza Hut have all mastered the art of mass marketing, we have to do something like that to clear the backlog of Million blind eyes in India. We perform only one million cater acts a year. At this rate we can’t catch up.” Each of the Aravind Hospitals has two sections: one is the Main Hospital for the paid patients and other is free hosp ital for nonpaying patients. The series of steps, which a patient normally goes through, is the same in both the hospitals: patients are initially registered, their vision is recorded and they undergo a preliminary examination followed by testing of tension and tear duct function. This follows refraction test and final examination. While the assistants carry out many of the intermediate steps, a senior ophthalmologist does the final examination. The two sections differ in size, the kind of beds they provide and general kind of patients. Who come to use them? However, the same pool of doctors and nurses serves both sections. “The hallmarks of the Aravind model are quality care and productivity at prices that everyone can afford. A core principle of the Aravind System is that the hospital must provide services to the rich and poor alike, yet be financially self-supporting. This principle is achieved through high quality, large volume care and a well-organized system.” In Aravind Hospitals, a typical Operation Theater (OT) has two tables side by side. The surgical team keeps one table ready while the surgeon is working on the other. The surgeon merely turns and starts doing surgery on the other table as soon as he

finishes the current one. In this way, the valuable time of surgeon is used properly. Aravinds’ surgeons take only 10 minutes per surgery while industry standard is 30 minutes. Aravind achieves this feat while maintaining the world standard in quality. Its infection rate is only 4 per 10,000 cases as opposed to 6 per 10,000 in UK. And they are able to carry out 400 surgeries per doctor per month as opposed to the average of 25 surgeries per doctor per month. To cater to such high performing, large-scale surgical system, Aravind has to ensure that enough patients come to it; partly to achieve this, Aravind organizes camps to attract patients in rural areas, Help of local organizations like ions club is taken in publicizing the camps. They also of ten help with sharing of the part of cost in transporting patients and other such activities. In these camps, patients go through the similar steps of registration, vision recording. Preliminary examination, testing of tension, refraction, and final examination. If a surgery is found to be required, patients additionally undergo BP and urine sugar test and their surgery papers are prepared. Following this, patients are taken to the nearest Aravind for surgery and brought back to the same place after three days. This is unlike many other camp organizers who perform surgeries in the camps themselves. For its hospitals, Aravind recruits nurses from the nearby villages. Aravind essentially looks for hunger to do some good in such people before it trains them for the job. They need not have any nursing training before coming to Aravind. Nurses typically do not leave Aravind because they tack the necessary qualifications to get employed in other hospitals. Aravind is finding it a little harder to recruit and keep doctors; it expects its doctors to work nearly 60 hours a week as opposed to 30 hours in many institutions. They tend to leave Aravind after few years as they command higher salaries in the marketplace than what Aravind gives them. Till few years back, Aravind used to provide only the intra-cap surgeries for free patients as the cost of in ocular lens was high. Each in ocular lens used to cost Rs 800, as t had to be imported. In 1991, Aravind set up a factory to produce 60,000 IOLs per year. Initially, it had a detect rate of 50% and the cost of each lens worked out to be Rs 200/-. Over time, it was expected that the cost of the lens would drop to Rs 100/- as the factory improved its working. This factory was set up as a separate venture so that the hospitals could keep their focus on eye care. Recently, the factory has also started manufacturing sutures and other items used in the surgeries. In a recent interview to two Indian business school professors, Mr. R. D. Thulsiraj, MD, Aravind Hospitals, remarked that eye care has some unique characteristics that make it possible to transfer the model directly. One characteristic is the high volume: about 20% of the population needs glasses and 1% has cataract. Secondly, the intervention for the most part is one time, because it is not a chronic disease, or one needing long-term treatment like cancer, Finally, intervention is quite low cost unlike, say, bypass surgery. But Dr. V argued, “I think this model must work in other health care sectors also, whether it is women’s heath or children’s health, or cancer or tuberculosis, People like you must explore and see where this model can be applied, our main focus should be on improving the total health of the country

Exhibit 1

Exhibit 2 ARAVIND EYE HOSPITALS Statistics—Year 2004 Outpatient Visits: 1,635,599 Surgeries: 228,894 Free Eye Camps: 1,271 Statistics—Year 1976—2004 Outpatient Visits: 17,778,075 Surgeries: 2,225,225 Free Eye camps: 20,995

QUESTIONS:- 1. What is the vision of AECS? What is the role of operations in meeting it? 2. Can this system be replicated to other aspects of health care? Other services? What will be the problems? What will be the advantages? 3. How do different elements of AECS work together to deliver the vision of Dr. V? 4. What are some of the problems AECS facing? Are they inherent in its model or they could be rectified while keeping the model intact?

Case – 2 Marks-15 On the night of Feb 28th, the last day of classes, Nilesh proposed to Geeta, his MBA classmate of nearly a year and a half. Geeta agreed immediately and wondered if all her classmates will be able to attend their wedding as once they all go back to their homes it would be really very difficult for everyone to get together again. Suddenly, Nilesh came up with the idea: what if they got married on March 22nd? “But how could it be? Our convocation is on March 21st Geeta said. “Exactly! All our classmates will definitely come here for convocation and they would not mind staying an extra day for the wedding. In fact, we will get the blessings of even their parents as many are planning to come for the convocation.”

Geeta: Right. But so many things have to be done. That is also when the wedding season starts and all the reception halls become unavailable. For our send-off party, juniors were saying that hotels were insisting on 17 days notice. Of course, for Rs 5000/- extra the notice period can be reduced to 10 days. Nilesh: I want my brother and sister-in-law to come for the wedding. Geeta: But, they are in US and working. They will require at least 10 days before they can be here. Also my parents will have to buy your sister-in-law a sari-set (sari with matching blouse and petticoat) as per the tradition. She will have to be here well in time so that they can be fitted well. Nilesh: And catering! It takes two days to choose the menu and Pandal decorations. Hotel Sayaji wants at least 10 days notice period before the formal engagement ceremony (one night before the wedding). Geeta: And what about our dresses? These days, it is better to get it made after choosing the pattern and buying the material yourself. It would take three days to choose the pattern and eight days to order and receive the material after Nilesh: Yes. But the material supplier can deliver in five days if we pay an extra of Rs 1000/- for expediting it.

Geeta: I want Joyti of Asha Boutique to work on our dresses.

Nilesh: But she charges Rs 500/- for one day of work.

Geeta: If I got my mother to do all the services, we could finish the dresses in 11 days. If Joyti helped, we could cut that down to six days, at a cost of Rs 500/- for each day less than 11 days.

Nilesh: It would take another two days to do the final fitting. Then dry-cleaner will take two days to clean and press the dresses unless we pay Ps 1000/- for the express service of single day delivery.

Geeta: That’s right. By the way, have you thought about invitations? Nobody will come unless we invite them formally.

Nilesh: Anand Printing Press will take 12 days to print the invitation cards. Of course, they do have an express service and can deliver in five days if we pay them extra Rs 1500/-

Geeta: It will take three days to prepare the matter which will be printed and select the styles.

Nilesh: Given the postal delays, the invitations have to go out at least 10 days before the wedding.

Geeta: Mailing them will take a day and that cannot be done until we write addresses on them. Addressing will take four days unless we hire some help. We can finish addresses in two days if we hire a part-time help for Ps 200/-.

Geeta: We also have to buy some jewellery items to be given as gift to my brother-in-law. It will take a day to do that

Nilesh: But before we start writing address, we will have to prepare a guest list. We can’t afford to miss out on anyone important, as that will have an impact on the relationship with them forever. We will have to be really thorough on that. I think it will take four days to prepare an exhaustive guest list. Geeta: That does sound like a lot. Now it certainly looks much easier to earn an MBA degree than get married!!!

QUESTIONS:- 1. Given the activities and precedence relationships described in the (A) case, develop a network diagram for the wedding plans. 2. Identify the paths. Which are critical? 3. What is the maximum cost plan that meets the March 22nd deadline?

Case -3 {Continuation of Case 2} Marks-15 Several complications arose during the course of trying to meet the deadline of March 21, for the Nilesh—Geeta engagement. Since it was important for Nilesh and Geeta to get married on March 22nd, the implications of each of these complications had to be assessed. 1. All hotels informed that the express booking had to be withdrawn that year as there was a mad-rush for getting married, and therefore Nilesh and Geeta would have to give 17 days’ notice. 2.A call to the US revealed that brother and sister-in-law couldn’t leave till March 1st as they had urgent deadlines at work. 3.Nilesh came down with four day flu just as he started to work on the guest list. 4. The dress material was lost in transit. Notice of loss was delivered to Geeta on March 10th. 5. There was an unplanned repair work at Sayaji on March 8. They informed that they would be closed for two to three days.

QUESTIONS :-

1. Given your answers to the (A) case, describe the effects on the wedding plans of each incident noted in the (B) case.

SECTION B Marks-30 Attempt all the questions:-

1 ) B r i e f l y s ke t c h t h e pr odu c t deve l opmen t p r o c es s .

2 ) What do you mean by c ont i nuous impr ovem ent ? G i ve two e xam p les o f c on t i nuous im pr ovemen ts t ha t o r gan i z a t i on s unde r t ake .

3 ) Suppose you wa n t t o v i s i t y our b ank t o d epos i t you r s a la r y c heque and t hen w i t hdr aw some m oney f r om your a c c ount . U se you r know ledge o f p r o c es s ma pp ing and d ra w t he p r o ce s s .