With the current hard economic times as a result of the current global economic recession, it is the dream of every organization to review its business strategies and therefore figure out how it will realize its set goals and objectives. This is also the case that happens here with Netcare and it can be termed as the main reason why it decided to have an acquisition of operation in the United Kingdom or rather to expand internationally.
There are a lot of benefits that an acquisition is known to bring and they are known to affect the operations of the new organization in different ways. In this case, there are some ways that this acquisition has affected the strategic capabilities of the new organizations. This acquisition can be said to help Netcare to achieve its objective of providing quality and innovative health care services in every continent of the world and to as many people as possible. (apax. com, 2006)
With the Netcare was able to apply its six themes which it believed would be very helpful in the future of the company. With the entry in to the United Kingdom market, the company was able to move all the experience and expertise of its senior team to the two countries. This is something that was not possible in South Africa due to the political interference and the type health care system. This merger helped the company to provide high-quality services at low prices and this was not affordable in the tradition method that had previously been very expensive.
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The merger also helped the company to adopt new technology which assisted in operational excellence. The merge is also known to improve on Netcare’s passionate people theme, best and safest patient care, and finally in transforming Netcare from a country based health care organization to an internationally recognized health care organization. (Porter, 2000) South African had very strict competition rules and tough regulations. This meant that for an organization to fully succeed, it had to face a lot of the obstacles that were set by the government there.
In addition, there was a lot of political pressure in South Africa and this made it almost impossible for any organization to even think of expanding. With the new acquisition in the United Kingdom, Netcare was able to get out of the political bondage. This meant that with the new United Kingdom hospitals acquired, Netcare would be able to conduct uninterrupted decisions on the growth strategies to apply. The healthcare system in the United Kingdom was different from that in the South Africa and this allowed room for fair and healthy competition. (Statistics South Africa, 2005)
In addition, South African can be termed as a country that is living like to two countries. On one side, it is a developed nation living like the other developed nations of the west while on the other side is a developing nation living like most of the African states all the other third world countries. This made the country’s healthcare system to adopt a doctor-centered approach. This meant that instead of hiring one permanent doctor, the hospitals were competing for the best doctors who would provide services on contract basis.
This would mean that the hospitals did not have any specific doctor who would carry out the daily activities or rather the most important activities of the hospital. This derailed any strategic planning that the hospital may have as they are not aware of the availability of the doctors. With the merger, Netcare found out that the approach in United Kingdom is different and there is a very healthy competition, it was therefore able to plan adequately for the future. (GIBS, 2007) In conclusion, the health care system in the United Kingdom was completely different from that in South Africa.
Netcare saw a lot of potential in the United Kingdom due to its healthcare system which had an expanding waiting list especially of the elderly. In addition, it had the hope of using its six strategies to realize its objective of making health care services available to as many people as they could in the world. They succeeded in entering this market and this changed or rather influenced the company’s strategic capabilities due to different health care systems in the two countries and different government and health care regulation policies.
apax. com. (2006, April 25).
Network Health Care Holding Acquisition. Retrieved July 10, 2010, from www. apax. com/en/news/story-general-healthcare-group-limited. html. GIBS. (2007).
Friedland Presentation to Students of MBA . London: GIBS. Porter, M. (2000). Economic Development Quarterly. Location, Competion, and Economic Development. Retrieved July 8, 2010, from http://edq. sagepub. com. ezproxy. liberty. edu:2048/content/14/1/15. full. pdf+html Satterlee, B. (2009).
Cross Border Commerce. Roanoke, VA: Synergistics, Inc. Statistics South Africa. (2005). General Household Survey.
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