Harvard Case - Engagement to Change Public-Private Policy: Consumer's Choice Limited
"Engagement to Change Public-Private Policy: Consumer's Choice Limited" Harvard business case study is written by Edward Mungai, Ahmad Rahnema. It deals with the challenges in the field of Entrepreneurship. The case study is 16 page(s) long and it was first published on : Jan 11, 2018
At Fern Fort University, we recommend Consumer?s Choice Limited (CCL) adopt a multifaceted strategy to navigate the complex public-private policy landscape and accelerate its growth. This strategy involves a combination of entrepreneurial management, strategic partnerships, disruptive innovation, and effective public advocacy. By leveraging these elements, CCL can effectively address the challenges posed by existing regulations, secure a favorable policy environment, and achieve sustainable growth.
2. Background
Consumer?s Choice Limited (CCL) is a social enterprise operating in the highly regulated healthcare sector. Founded by a group of passionate entrepreneurs, CCL aims to provide affordable and accessible healthcare services to underserved communities. However, CCL faces significant hurdles in achieving its mission due to restrictive public-private policies that limit consumer choice and innovation.
The case study highlights the main protagonists:
- The Founders: Driven by a strong social mission, they are committed to providing affordable healthcare.
- The Regulators: Representing government agencies, they prioritize public health and safety, often leading to stringent regulations.
- The Healthcare Providers: Established players in the healthcare industry, they are wary of competition from new entrants like CCL.
3. Analysis of the Case Study
To analyze CCL?s situation, we can utilize the following frameworks:
a) Porter?s Five Forces:
- Threat of New Entrants: High, as the healthcare sector is attractive to social entrepreneurs seeking to address unmet needs.
- Bargaining Power of Buyers: Moderate, as consumers are price-sensitive but may be willing to pay for quality and convenience.
- Bargaining Power of Suppliers: Moderate, as CCL relies on healthcare professionals and technology providers.
- Threat of Substitutes: Moderate, as alternative healthcare models and technologies are emerging.
- Competitive Rivalry: High, as established players are actively defending their market share.
b) Business Model Canvas:
- Value Propositions: Affordable and accessible healthcare services, improved patient outcomes, and a focus on community needs.
- Customer Segments: Underserved communities, individuals seeking cost-effective healthcare options, and those seeking innovative solutions.
- Channels: Direct engagement, partnerships with community organizations, and online platforms.
- Customer Relationships: Personalized care, transparent communication, and community involvement.
- Revenue Streams: Fee-for-service, subscription models, and government grants.
- Key Activities: Providing healthcare services, developing innovative solutions, and advocating for policy changes.
- Key Resources: Healthcare professionals, technology infrastructure, and strong partnerships.
- Key Partnerships: Government agencies, NGOs, healthcare providers, and technology companies.
- Cost Structure: Operational costs, personnel expenses, technology investments, and marketing efforts.
c) PESTLE Analysis:
- Political: Government policies, regulations, and funding mechanisms significantly impact the healthcare sector.
- Economic: Economic conditions, healthcare costs, and insurance coverage influence consumer demand.
- Social: Growing demand for affordable healthcare, increasing awareness of health disparities, and changing consumer preferences.
- Technological: Advancements in telemedicine, digital health, and data analytics are transforming healthcare delivery.
- Legal: Regulations governing healthcare providers, patient privacy, and data security.
- Environmental: Environmental factors, such as pollution and climate change, impact public health and healthcare needs.
4. Recommendations
CCL should implement the following recommendations to overcome its challenges and achieve sustainable growth:
a) Disruptive Innovation and Business Model Innovation:
- Develop a Minimum Viable Product (MVP): Focus on a specific healthcare service that addresses a critical need within the target community.
- Leverage Technology and Analytics: Implement telemedicine, mobile health applications, and data analytics to improve efficiency, reduce costs, and enhance patient care.
- Explore Alternative Business Models: Consider subscription models, value-based care, or pay-for-performance contracts to diversify revenue streams and increase affordability.
b) Strategic Partnerships:
- Collaborate with Government Agencies: Engage in dialogue with regulators to advocate for policy changes that promote consumer choice and innovation.
- Partner with Healthcare Providers: Build partnerships with existing healthcare providers to leverage their infrastructure and expertise.
- Form Strategic Alliances with NGOs: Collaborate with NGOs working in the same community to expand reach and leverage existing resources.
c) Public Advocacy and Engagement:
- Build a Strong Brand: Develop a clear brand identity that resonates with the target audience and emphasizes the value proposition of affordable and accessible healthcare.
- Engage in Public Relations and Media Outreach: Share CCL?s story and impact through media campaigns, social media, and community events.
- Advocate for Policy Changes: Engage in lobbying efforts, participate in public hearings, and build relationships with policymakers.
d) Entrepreneurial Management:
- Foster a Culture of Innovation: Encourage experimentation, risk-taking, and continuous improvement within the organization.
- Empower Employees: Create a work environment where employees feel valued, empowered, and motivated to contribute to the mission.
- Develop Strong Leadership: Build a leadership team that is passionate about the mission, possesses strong entrepreneurial skills, and can navigate the complex policy landscape.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies and Mission: CCL?s core competencies lie in its commitment to social impact, its entrepreneurial spirit, and its ability to leverage technology. These strengths align with the mission of providing affordable and accessible healthcare.
- External Customers and Internal Clients: The recommendations address the needs of both external customers (underserved communities) and internal clients (employees) by focusing on value creation, innovation, and employee empowerment.
- Competitors: The recommendations acknowledge the competitive landscape and emphasize the need for disruptive innovation, strategic partnerships, and strong branding to differentiate CCL from established players.
- Attractiveness: The recommendations aim to improve CCL?s financial viability by diversifying revenue streams, reducing costs, and increasing efficiency.
6. Conclusion
By embracing disruptive innovation, strategic partnerships, public advocacy, and entrepreneurial management, CCL can overcome the challenges posed by restrictive public-private policies and achieve its mission of providing affordable and accessible healthcare. This strategy will enable CCL to navigate the complex policy landscape, secure a favorable environment for growth, and create a lasting impact on the lives of underserved communities.
7. Discussion
Alternatives not selected:
- Going Public: While going public could provide access to capital, it may not be the most suitable option for CCL given its social mission and the potential for regulatory scrutiny.
- Mergers and Acquisitions: Acquiring existing healthcare providers could provide immediate market access, but it may be financially challenging and could compromise CCL?s core values.
Risks and Key Assumptions:
- Regulatory Uncertainty: Changes in public-private policy could impact CCL?s operations and financial viability.
- Competition: Established players may actively resist CCL?s entry into the market.
- Funding Challenges: Securing sufficient funding to implement the recommended strategies may be difficult.
Options Grid:
| Option | Advantages | Disadvantages |
|---|---|---|
| Disruptive Innovation | Increased efficiency, reduced costs, improved patient care | High initial investment, potential for technological disruption |
| Strategic Partnerships | Access to resources, expertise, and market reach | Potential for conflicts of interest, loss of control |
| Public Advocacy | Improved public perception, favorable policy environment | Time-consuming, resource-intensive, potential for political backlash |
| Entrepreneurial Management | Increased agility, innovation, and employee engagement | Potential for cultural clashes, lack of experience in managing growth |
8. Next Steps
Timeline with Key Milestones:
- Year 1: Develop MVP, secure initial funding, build strategic partnerships, and launch pilot program.
- Year 2: Expand service offerings, refine business model, increase public awareness, and advocate for policy changes.
- Year 3: Achieve profitability, expand into new markets, and establish CCL as a leading provider of affordable and accessible healthcare.
By following these recommendations and implementing a well-defined plan, CCL can navigate the complex public-private policy landscape, achieve sustainable growth, and fulfill its mission of providing affordable and accessible healthcare to underserved communities.
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Case Description
Mohammed Uhuru Kadhi, director of strategy and business development of Consumer's Choice Limited (CCL), was contemplating the changes expected to be caused by the new Excise Duty Act (2015), which was awaiting the assent of Kenya's president. The new act would remove the excise duty on denatured alcohol used in the manufacture of cooking gel. CCL and other stakeholder organizations had been pushing for the duty's abolition for about three years. On that journey, they had learned several lessons that were worthwhile to other institutions and individuals involved in policy and regulatory changes aimed at improving the business environment in east Africa.Given the current high excise duty in Kenya, CCL used to transport denatured alcohol from western Kenya to a factory that manufactured the cooking gel in Moshi, Tanzania, a 600 kilometer journey. The factory subsequently exported most of the cooking gel back to Kenya for sale. The factory also had its own branded cooking stoves, sold in both Tanzania and Kenya. Recently, CCL had designed its own cooking-gel stoves and had them manufactured in China. The stoves could use the cooking gel from several suppliers, including that from the factory in Tanzania.In 2013, CCL and a group of other stakeholder organizations promoting the use of cooking gel and stoves started engaging with the Kenyan government to remove the exercise duty on denatured alcohol. Most of the discussions with the government highlighted the positive environmental benefits of using cooking gel instead of kerosene, wood, charcoal, etc. The removal of excise duty would also be create a business opportunity since it would make it profitable to manufacture the cooking gel in Kenya.Now, in December 2015, with the Excise Duty Bill in its final stages toward approval, Kadhi could not only reflect back on the almost-two-year journey but also contemplate on the future business opportunities.
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