Shouldice Hospital Case

Canada’s Shouldice Hospital is known worldwide for its specialty of hernia repairs. In fact, that is the only operation Shouldice performs, and it performs a great many of them. Over the past few decades, this 89-bed hospital has averaged 7,000 operations annually, with more than 250,000 hernia surgeries since 1945. Patients, coming from 80 different countries, are so loyal that as many as 1,500 per year attend the Hernia Reunion gala dinner, complete with free hernia inspection.Perhaps Shouldice’s recurrence rate of only 1%, as opposed to 10% for general hospitals performing this surgery, is a major factor. About 1% of Shouldice’s patients are themselves M.D.s.

A number of features in Shouldice’s service delivery system contribute to its success: (1) it only accepts patients with uncomplicated external hernias and who are in good health; (2) patients are subject to early ambulation, which promotes healing; (3) its country club atmosphere, superior nursing staff, and built-in socializing make a surprisingly pleasant experience out of an inherently unpleasant medical procedure.

The Medical Facility

The medical facilities at Shouldice consist of five operating rooms, a patient recovery room, a laboratory, and six examination rooms. Shouldice performs, on average, 150 operations per week, with patients generally staying at the hospital for 3 days. Operations are performed only 5 days a week, but the remainder of the hospital is in operation continuously to attend to recovering patients.

An operation at Shouldice is performed by one of the 12 fulltime surgeons. Surgeons generally take about 1 hour to prepare for and perform each hernia operation, and they operate on four patients per day.

The Surgery Procedure

All patients undergo a screening exam either by questionnaire or in person (if convenient) prior to setting a date for their operation. Patients then arrive at the clinic the afternoon before their surgery, receive a brief preoperative examination, and see an admissions clerk to complete paperwork. They are next directed to one of the two nurses stations for blood and urine tests and then are shown to their rooms. Orientation begins at 5 P.M., followed by dinner in the dining room. Patients gather in the lounge area at 9:00 P.M. for tea and cookies.

On the day of the operation, the patients are administered a local anesthetic, leaving them alert and fully aware of the proceedings. At the conclusion of the operation, the patient is encouraged to walk from the operating table to a wheelchair, which is waiting to return them to their room. After a brief period of rest, patients are encouraged to get up and start exercising. By 9 P.M. that day, patients gather in the lounge for cookies and tea, and talking with new, incoming patients. The skin clips holding the incision together are loosened, and some are removed the next day. The remainder are removed the following morning just before the patient is discharged.

When Shouldice started, the average hospital stay for hernia surgery was 3 weeks. Today, some institutions push "same-day surgery" for a variety of reasons. Shouldice Hospital firmly believes that this is not in the best interests of the patients, and is committed to its 3-day process. Shouldice’s post-op rehabilitation program is designed to enable the patient to resume normal activities with minimal interruption and discomfort.

The Plan for Expansion

Shouldice’s management has been thinking of expanding the hospital’s capacity to serve a considerable unsatisfied demand. The first option for expansion involves adding Saturday operations to the existing 5-day schedule. This would increase capacity by 20%. The second option is to add another floor of rooms to the hospital, increasing the number of beds by 50%. This would require more aggressive scheduling of the operating rooms.

Table 1 illustrates room occupancy for the existing system. Each row in the table follows the patients who checked in on a given day. The columns indicate the number of patients in the hospital on a given day. For example, the first row of the table shows that 30 people checked in on Monday and were in the hospital for Monday, Tuesday, and Wednesday. Summing the columns of the table for Wednesday indicates that there are 90 patients staying in the hospital that day.

The administrator is concerned about maintaining control over the quality of the service delivered. He thinks the facility is already achieving good utilization. The doctors and the staff are happy with their jobs, and the patients are satisfied with the service. Further expansion of capacity, he believes, might make it hard