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NHS to Expand into Global Markets
In 2010, Labour's Health Secretary set up NHS Global to help the health service make the most of the global market for healthcare and the coalition now wants to build on this.
Health Minister Anne Milton said: "This is good news for NHS patients who will get better services at their local hospital as a result of the work the NHS is doing abroad and the extra investment that will generate. The NHS has a world-class reputation, and this exciting development will make the most of that to deliver real benefits for both patients and taxpayers."
Professor Ajay Bhalla, of Cass Business School comments on the NHS’s plans to expand into international markets.
“The idea that high profile NHS hospitals will expand into international markets has lot of merit. Without any doubt, NHS is a widely revered institution holding great brand equity and respect across the globe. In theory, the trusts under the umbrella of NHS Global will plough the revenues generated from private patients in the UK into establishing world-class hospitals in international markets. The profits from these international affiliates will then flow back into the NHS corporate located in the UK.
“However, in practice not only the logic is ill-thought but has been floated at an early stage without attention to detail risking an idea which may actually have merit. There are several reasons why that is the case. First, entering global markets requires unremitting attention from the top and commitment to devote not only financial resources but also scarce resources such as top performing consultants and administrators with technological and process know-how.
“Second, entering global markets requires knowledge of local terrain and the capability to form partnerships with top-tier local players (e.g. Fortis or Apollo in India) who themselves have global ambitions. Moorfields Eye Hospital may have succeeded in Greenfield Dubai, but is likely to encounter different playing field if it targeted any of the emerging markets. Hence location choice along with the mode of entry becomes a key driver for success in local markets.
“Third, entering global markets is no game for faint-hearted public institutions who are much more prone to public criticism than deep-pocket shareholding institutions with diversified portfolios. Success in global markets does not come easy and failures are part of learning and long-term commitment to internationalize.”
To speak to Professor Bhalla please contact Helen Merrills, Press Assistant at Cass Business School (http://www.cass.city.ac.uk/