conclusions

From mariat
Pacific Cataract and Laser Institute
PCLI is a company that has demonstrated that it has capabilities for success. Even today, we can access their care Website and discover that their presence has not vanished after twenty years of market competition. The company has developed into a modern center with great facilities and cutting-edge technology. However, PCLI with its prestige and capabilities remains in the same regional location. In twenty years, PCLI has not been able to enter new markets in different regions of the United States.
After a careful revision and analysis, our team concludes that PCLI was facing great challenges back in 2002. The adverse situation was created in part by the company’s response to core values and in part due to a lack of understanding of the external environment in a highly competitive market. The SWOT analysis on PCLI revealed the factors that played an important role in the company business strategies: inadequate marketing strategies, lack of corporate level vision of the future, inappropriate use of corporate capital and human capital, inability to differentiate themselves from competitors, and inability to understand clients demands.
“In 2002, Pacific Cataract Laser Institute had the capacity to do more vision correction that they were actually doing” (Lawrence & Morris, 2002). The institute had all the resources, tangible and intangible, to exploit at maximum and achieve strategic competitiveness, but chose not to do it because it was against the company’s core values: PCLI could not treat eye surgery as a commodity and advertise it based solely on price. The management team did not understand that advertisement was a key strategy to make the company visible in the market.
The company had excellent surgeons and the quality service was just the best they could offer. This concept matched the company’s core values. The human capital that the company possessed had in fact accomplished outstanding goals. For example, one of the surgeons even researched and developed a machine that was not equal to the others being used in the market. These achievements were never advertised, so the human capital did not get the recognition they deserved. In addition, PCLI had seven surgeons that specialized in various forms of eye surgery. Out of those seven doctors, only three were trained to perform laser surgery. In our opinion, this was a mistake because the company had to fly those three surgeons and their assistants from location to location in order to attend their limited number of patients. The company allowed high compensation for this human capital and did not train the rest to do the same type of surgery.
Because the number of providers performing laser surgery was limited to three, the company had to spend their corporate capital flying two private aircrafts. The company’s intention was good; they wanted to give their clients to possibility to be seen by their best team. However, flying the surgeons constantly, we think, helped increase the cost of laser surgery for the patients. PCLI did not develop a plan to have surgeons in each location to develop a presence for future growth.
In 2002, the company had been in the business of laser surgery for three years, while their competitors had the advantage of being in the market for almost a decade. Other companies had a competitive advantage because of the number of procedures performed for a long time. Competitors charged less because they were able to save on royalties and transportation expenses. They opened multiple locations, trained different doctors, and collaborated with various surgeons. The competitors saw the opportunity to expand their company through these strategies.
PCLI did not understand the external environment at that time. Patient wanted the procedure but they were limited by their economies. The simplicity of the procedure (5 to 15 minutes) also played an important role. These patients did not want to pay excessive amounts of money for a procedure that did not take a prolonged time even if the surgery was performed by the best surgeon. PCLI’s marketing department did not find the way to differentiate its services from the competitors’ in order to justify the high amounts of money it charged. The institution did not realize that its capabilities were substitutable. PCLI’s management team did not consider advertising aggressively to attract more prospective clients because it was too attaches to its core principles.
In our opinion, the corporate had a business-level strategy that was non reactive to market trends. They only focused in one type of service and one region of the United States when the competitors were finding opportunities in different locations. While the competitors were moving to small towns to allow more people to enjoy the wonders of technology, PCLI spent all their capital in providing outstanding customer service in fixed locations.
PCLI’s doctors were focusing only in the quality of their services, meanwhile the company failed to recognize customers’ various demands. Patients in the States were not only looking for correcting vision surgery, but also other types of services such as evaluations, follow up visits, corneal care, etc. PCLI did not provide this kind of services, and by doing so; it deliberately reduced the number of prospective clients. PCLI management wanted the company to be recognized as one of the best technological centers, with innovative equipment, and excellent surgeons so they chose to specialized in one type of surgery.
Besides the fierce competition and the company’s own strategies, there were other factors from the external environment that affected PCLI business. PCLI had to pay royalties to providers of the equipment ($250 per surgery), which also reflected on the final cost for patients. While the competitors were using new technology, PCLI had to use old equipment until FDA tested and approve the new technology.
PCLI could not afford to cut their doctors salary because that was already part of their culture. Had the company been able to cut on salaries, transportation expenses, and had FDA’s regulations on their favor, it could have been able to save substantial amounts of money and apply those savings to their customers. We believe that PCLI did not see the possibilities in expanding their clientele; the company did not seek to grow beyond the Pacific Northwestern region.
To prove this concept, we only need to check the current company’s Website. The advertisement still focused in this region only. On the positive side, we can name some things that PCLI changed and seem beneficial. For example, the company not only expanded the number of services offered but also increased the number of doctors performing these services. Today, The Institute provides high caliber medical care in the areas of:
· Cataract surgery
· LASIK surgery—treatment of nearsightedness, farsightedness, and astigmatism
· Glaucoma care
· Corneal care
· Eyelid surgery
· Retinal care
(Pacific Cataract and Laser Institute [PCLI], 2006, 1)
In addition, PCLI offers its prospective patients education through free book on Cataract surgery, free LASIK DVD on video, free Infant Eye Assessment, among other things. This is today though. It would be interesting to start another case study to find out how many eye surgery companies are competing in the market and if PCLI is one of the top companies.

References
Lawrence, J. J., & Morris, L. J. (2002, 2002). Pacific Cataract and Laser Institute: Competing in the LASIK Eye Surgery Market. Lasik Eye Surgery, (Case twenty-three), 306.
Pacific Cataract and Laser Institute (2006, 2006). Company index. Retrieved Dec 3, 2006, from www.pcli.com/company/index.html