Details

Case

Shaukat Khanum Diagnostic Centre

Asim Riffat, Syed Mubashar Ali

INDUSTRY : Health Services

AREA : Finance

ORGANIZATION : Shaukat Khanum

LENGTH : 19

LUMS No : 02-620-2004-1

PUBLICATION YEAR : 2004

KEYWORDS:

Shaukat Khanum,Diagnostic Center,Finance,SKMCH & RC,Hospital,Healthcare

DESCRIPTION:

In January 2001, Shaukat Khanum Memorial Cancer Hospital (SKMCH) started a Diagnostic Centre at 134-Habitat Villas, adjacent to Jail Road in Lahore, to provide quality diagnostic services to the people at a convenient location. It was believed that the centre would attract huge volumes of business and would enable the hospital¿s clinical income to carry a greater burden of SKMCH expenses. The centre did not succeed in generating the expected volume. The first six months' performance showed that the centre might not be able to cover its own expenses. It was proposed to move the centre to the main Jail Road where a suitable piece of property had been donated to the trust. It was believed that the new site would offer better volumes of business as it was located across the road from Services Hospital and the Punjab Institute of Cardiology (PIC), the main diagnostic and medical establishments on the busy road. The case allows analysis and the application of standard techniques of finance to a non-profit organization. The complexities inherent in the situation and the difficulty in selecting an appropriate discount rate are also issues for discussion and debate.

LEARNING OBJECTIVES:

The case depicts an actualt situation faced by the head of the Marketing Department of Shaukat Khanum Hosptal and required a new way of analyzing the problem. Indeed the outcome of the case and its analysis was that the discounted cash flow analysis has been adopted as a standard decision making tool and all new proposals have to go through the discounted cash flow based method.

SUBJECTS COVERED:

Finance