India is the second most populous country in the world with population currently over one

billion mark. At the outset of its independence, she pursued socialist policies and programs.
These are now changing in favor of free market principles. Waves of large scale liberalization of
various sectors of the economy, privatization and globalization are stirring every part of the
economy. The Indian economy ranks fifteenth in the world with a Gross National Product (GNP)
equivalent to US$ 450 billion.

The personal health sector is one such part of Indian economy that is witnessing sea changes.
The country is now negotiating with an epidemiological transition wherein infectious diseases
causing adult morbidity and mortality are disappearing or have already been eradicated. Non-
infectious diseases are however, assuming menacing proportions. These include coronary heart
diseases, diabetes, hypertension and neurological disorders. The transition has a lot to do the
socio-economic changes in India in the last two decades. The World Bank Health Sectoral
Priority Review projects a doubling of cardio-vascular disease mortality rate in India between
1985 and 2015.

Reflecting the transition, the Indian Ministry of Health and Family Welfare- the prime policy
mover for Indian healthcare sector, has begun to stress on the preventive, primitive, public
health and rehabilitation aspects of health care. It also underlined the need of establishing
comprehensive healthcare services to reach the population in all areas of the country through
inviting and integrating private participation in funding healthcare at the secondary and tertiary
level. During the last two decades, state spending on healthcare was overtaken by the private
spending. In 1987, the governmental share if healthcare funding was 1.6% out of a total of 4.3%
of GDP spent on healthcare. In 1990, the government's share declined to 1.3%, while the
private sector share increased to 4.7%. This trend of declining governmental spending will only
gain further momentum. The states are to focus on primary healthcare, leaving the secondary
and tertiary levels of healthcare to the private sector.

Thus, India's private hospitals are in for a rapid rise both in terms of volume and sophistication.
A principle mode of growth has been though corporatization. The Chennai based Apollo
Hospitals pioneered this new avatar of Indian hospitals in the early 80's. Many family business
houses have set-up hospitals or lent their names in order to inject a public confidence in their
hospitals. A few pharmaceutical companies like Wockhardt and Max India, have opened
hospitals as they leverage on their core competence. Hospitals, nursing homes and healthcare
centers require ever increasing capital investments in real-estate and medical infrastructure.
The corporatization and entry of private entrepreneurs help them access equity markets and
public funding to fund such projects.

Hospitals in India are now recognized as industry enabling the banks and financial institutions to
fund hospital projects. Foreign Direct Investments (FDI) is allowed in this sector with automatic
approval up to 51% by way of foreign investment in equity. As a further acceleration, sweeping
reforms are underway in respect of insurance sector especially in the health insurance. In India,
approx. 60% of the total health expenditure comes from self paid category as against
government’s contribution of 25-30%. Currently in India, only 2 million people (0.2 % of total
population of 1 billion), are covered under Mediclaim, whereas in developed nations like USA
about 75 % of the total population are covered under one or another insurance scheme. A
majority of private hospitals are expensive for a normal middle class family. Health insurance
will make healthcare affordable to a large number of people.

Finally, the healthcare customer is changing qualitatively. The rise of literacy rate, higher levels
of income and increasing awareness through deeper penetration of media, bring Indian
consumer closer to quality healthcare. With nuclear families on the rise, the bread-earner of
the family and indeed every member of the family now access regular health check-ups. All this
contributes to the growth of the healthcare sector in India and for more medical facilities in
private sector. With demand exceeding supply, India’s healthcare industry is worth US$17
billion (a recent estimate of the Confederation of Indian Industries, New Delhi) and is expected
to show a strong growth (over 13% by an industry estimate) for the present decade.

The private Indian healthcare sector has the following major corporate players:

- Apollo Group of Hospitals

- Escorts
- Fortis Healthcare
- Max India
- Wockhardt Hospitals Ltd.,
- GNRC Hospitals (Northeast)
In spite of the reform sweeping the health care sector in general, the Indian hospitals are
constrained by several government regulations. To begin with, Indian hospitals are not allowed
to advertise the way a telecom service marketer or a consumer goods marketer would. When
millions of rupees in technology and infrastructure are invested in a hospital, it makes it less
than fair. It impacts their efforts to survive, attract patients and to generate funds though
deregulated marketing, they contend. Still, each corporate hospital has formulated its
differentiated marketing strategy and business development plans to benefit from the
opportunities and to relate better with their customers. The following are the common
highlights of marketing strategies of Indian hospitals:

- Most private hospitals have invited eminent industrialists, celebrities and

social personalities to their governing and policy making board. Their
presence assures the general customers. At the same time, these
industrialists on governing board bring business to the hospitals and offer
patronage of their own firms.

- A few private hospitals offer token equity shares to their patrons, especially
to the referral doctors. Share-holding, however small, bonds the two,
creates a sense of ownership and forges partnership among the
intermediaries.

- Hospitals assure attractive discounts on hospital billing of their referral

doctors and their family.

- Most private hospitals segment the healthcare market carefully into

institutional customers and individual customers.

- Indian private hospitals enter into longer term contracts with institutional
customers assuring their services, offering lower rates and receiving
committed business from these key clients.

- There is rampant revenue sharing among the general physicians at the

primary health care levels and the specialist at the secondary and the tertiary
levels. ‘Cuts’ as they are termed as, are demanded -and offered, generously
to the referring physicians. The situation does not much differ even if the
referring physician is working in an institutional customer with whom, the
hospitals have already a contract of assured business.
- Continuous knowledge enhancement of the doctors and frontline staff is
now a priority and key to the survival and reputation of hospitals in India. A
large portion of hospital outlay is now earmarked for staff (doctors as well as
supporting staff) training, research and re-education.

- Technical upgradation and introduction of information technology is on the

rise in Indian hospitals. IT is in use not only for attracting customers from
non-neighboring locations, but it is also helping improve customer service.

- Loyalty based rewards are in operation in many hospitals.

- Segmentation is done more precisely as well as creatively. Instead of the

traditional segmentation vases, like geographic and demographic, Indian
private hospitals seek customers of desired psychographic nature
irrespective of where they reside.

- Special niches are identified and filled in by the hospitals for smaller size
customer clusters or needs.

- Customer focus and customer service are the new tools of hospital
marketing.

- Free health check-ups at hospitals, mobile health van and sponsored health
camps are organized to not only attract new customers but also to create a
feel-good environment in their served markets.

- Seminars, workshops and technical presentations are organized on technical

issues as well as on higher customer orientation and customer service.

- Co-branding - sharing hospital brand credits and marketing with other well-
known brands in services and goods, is on the rise.

- Hospital ambience is (re)engineered at par with those of hotel.

Pricing and Revenue Pattern in Indian Hospitals

In such a changing healthcare environment of India, it is important for a private corporate

hospital to remember how its pricing compares to competitors and how does it meet the
expected market norms. The latter is important because the state governments, health-
insurance cover providers, public action groups and media take an active interest in the hospital
performance and its pricing strategies. Virtually every hospital is on notice to be proactive in
pricing and performance driven in generating revenue.

Since pricing is the main tool of revenue generation in a subsidy-free private hospital, it is
worthwhile to map how an Indian hospital earns. In terms of overall revenue generation
pattern, Indian hospitals closely correspond to their American counterparts. The first source of
revenue to the hospitals is from the patients admitted to the hospital. However, interestingly,
approximately, 80% of the revenue from an admitted patient is earned within the first 72 hours
of admission. Thus, shorter the duration of the admittance of patients, the more profitable the
hospital is. The second source of revenue to the hospitals is from out patient departments
(OPDs). The patients’ traffic rate is higher in the Indian hospitals especially as the walk-in
patients (patients without having a prior appointment). Revenue from the specialized services
like operations and surgeries is the third major source of revenue for a hospital. In fact,
specialized hospitals even smaller in size (e.g. 100 bedded hospital), and catering to specific
diseases like cardiology, cosmetic surgery, neurology etc earn as high as a 500 bed general
hospital may. The Cardiac Care Units of a specialized hospital (CCUs) earn more than the
general room charges. Most hospitals are reducing permanently employed in-house doctors
and inviting a greater number of visiting doctors and experts. The visiting doctors pay up a
certain percentage (approx. 15%) of their billings to the hospital revenues, which is the fourth
major source of revenue. A few hospitals in India generate substantial revenues- the fifth
source, from selling medicines on their sites. In fact a few hospitals make it mandatory for the
patients to buy medicines from the hospital’s chemist shop on the ground that the medicine is
genuine and easily available. A margin of 15-20% is earned on from this source easily. With all
these sources of revenue combined, the hospitals in India still need to wait for a varying length
of time to break even. Large hospitals in India (with approximately 500 bed capacity) take about
9-10 years to break whereas super-specialty hospitals (with about 100 beds) take about 6-7
years to break even.
Pricing of their services are crucial to their survival and for earning surplus to plough back for
modernization and upgradation. What is new to the Indian hospitals is the fact that the pricing
can be an instrument of relations building as well. GNRC Guwahati hospital described from
now, realized it early and worked towards it

As soon as the dust settles from one storm in healthcare, another wind begins to stir. Today,
financial transparency has become the talk of the town. It has now almost become mandatory
for all healthcare-related conferences and publications to feature cost pricing prominently.
Costing and financial optimisation have today evolved into a focus area for all senior healthcare
executives.

When one speaks about pricing strategies, quality of care invariably creeps in as the antagonist.
We need to evolve from this deadlock and deal with quality as a component of healthcare
pricing, where there is no compromise. In the current turbulent healthcare environment,
hospitals have argued that the rate of increase in hospital costs is faster than the rate of
increase in hospital revenues. This is a genuine concern for hospitals that do not employ a clear
pricing strategy.

Healthcare pricing strategy is the most critical component of managing hospitals irrespective of
whether they are for-profit or not-for-profit. The long-term progress, and sustenance and
growth of any hospital depend on sound pricing strategies. In a maze of intricate process in a
hospital, the most flexible component is pricing and leveraging this flexibility is the secret
behind financial management of hospitals.

While a variety of factors influence pricing strategies, it is important to keep the process simple
and uncomplicated. Costs are relatively fixed, provided there is no compromise in the various
components that go into costs and pricing is dependent on a variety of factors like competition,
demand for the product in the community, affordability of the community and the need for
generation reserve funds. Therefore, the beginning of any pricing process is to understand the
cost of the product and the components included in the costs needs to be all inclusive. Often,
we tend miss out on allocating indirect costs to a product/service and this has a major impact
on profitability.

A variety of innovative concepts are being adopted in pricing healthcare strategies and the
most widely used strategies are briefly described here.

Day-care Procedures

These have become extremely popular as they have a favorable impact both on consumers and
hospitals. Few of the benefits that cannot be overlooked are:

 Similar existing resources utilised for more surgeries.

 The patient's hospital expense gets reduced as he is not required to stay over at the
hospital. This provides an opportunity to have a greater bed turnover and more revenue
 for the hospital. This is a benefit that all stakeholders like insurance companies, business
organisations, surgeons and especially patients greatly appreciate as the costs incurred
are lower.
 Apart from cost containment, other benefits include decompression of busy hospital
beds, less nosocomial infections and early recovery in home environment with the
family. Thus, there is less disruption of personal lives.

Packaging

Pakaging of various services is another trend that is on the rise. With the
increase in health insurance packaging, packaging of services will
increase further. This has become the mainstay of developed nations
working on reimbursement for services, but in India it is still in the
evolutionary stage. While packaging brings in some form of uniformity,
stability and transparency, there are some who would argue that this is
not necessarily the best pricing strategy. While a number of procedures
are being offered as packages, overwhelming majority of services are yet
to be offered as packages.

Delivering Value

A major component of pricing strategy is delivering value. When one talks about delivering
value, there is a paradigm shift in the way pricing strategies are viewed. When value is
delivered, the absolute price of a service becomes less important and this is a unique way of
working on pricing healthcare strategies. Value is defined as the sum of access, excellence,
efficiency and outcome minus the cost.

Traditional pricing formula: Cost + Profit = Price

Delivering value : (Access + excellence + efficiency + outcome) — cost

Hospitals should therefore start looking at delivering value and move away from working on
traditional pricing strategies.
Hospitals need to look into the pricing strategy.

The issue of pricing for healthcare deliverables has been a contentious issue for long in India
where consumers pay out of pocket. In the absence of an accreditation system, prices tend to
be fixed arbitrarily with wide disparity within a particular intervention may it be diagnostic or
therapeutic. However, the debate on pricing, which was a strict no-no in the private healthcare
sector, is slowly gaining momentum. Healthcare experts and consultants are now questioning
the mechanism of rate structuring followed by hospitals.

Experts feel that providers must do costing of all new services and review the fee for existing
ones periodically. They are also of the opinion that activity-based costing (ABC) should replace
market-based costing. Experts are now questioning the logic of market-based pricing structure.
“Some hospitals a few decades back must have fixed prices and others copied it. The yearly
revisions are non-existent in most hospitals and there is no logic to the existing pricing
structure,” says Amit Bagaria, CEO, Asian Health Services, Bangalore.

“Ideally prices should be fixed based on a cost-plus formula, which includes indexed time cost
of physicians, doctors & other staff. The mark-up over cost should
factor in things like urgency and seriousness of treatments, frequency, volumes, etc. Also,
lumpsum (package) prices should be fixed for at least 400 procedures, and not just for CABG
and laparoscopic cholecystectomy, as most hospitals have done,” he explains.

According to Bagaria, he hasn’t come across any Indian hospital which has packages for more
than 8-10 procedures, at best. “For all other procedures, the hospital gives an estimate of cost -
and 90 per cent of the time, the actual billed amount is higher than the original estimate,” he
claims.

Hospital rates should be arrived at by logical process of first making a detailed study of all the
costs involved, says Dr K C Ojha, MD, Hospic. “Costing should be done when a new procedure,
equipment, or activity is introduced. In case of existing services, 10 to 20 per cent is increased
randomly on basis of expenses. Price is increased on any package,” he adds.

Concurs Bagaria, “Prices are revised on a percentage basis every year, without doing actual
profit and loss analysis on each item or procedure. New hospitals get price lists of existing
hospitals and mark-up or mark-down is arrived at based on how they want to position the
brand.”

And why is it that costing is an exercise avoided by hospitals? Says Dr Vinay Kothari, CEO,
Hosmac, “Hospitals need to have a department that continuously monitors cost. This
department is a cost centre for the hospital, which is probably why they do not want to have
one.” Another problem is the lack of expertise that plagues the hospital industry. According to
Dr Kothari, there is a lack of cost accountants with knowledge on the hospital set up.
Asian Health services and Hosmac through their studies have shown that services are priced
much less than they should have been. AHS has done quite a few studies that have revealed
that, in certain cases, especially minor procedures, Emergency Dept. treatment, etc., the
charges billed to the patient were less than the actual input costs incurred by the hospital in
question. In most of the cases, this was true only of minor procedures, and not for major
surgeries. “So, the conclusion was, that major procedures were cross-subsidizing minor ones.
There is no good reason for doing this. A hospital which offers tertiary care does not need to,
and should not, offer subsidized rates for primary/secondary care treatment,” says Bagaria.

“It is a myth that costing may lead to cutting down the price. Costing becomes important
because hospitals need to know which are cost centres, which are the revenue centres and
where they should lay thrust to invest,” puts Dr Kothari. So the issue is not always about the
patient being over charged — it is also about irrational pricing.

Dr Ashok Bhatkhande, director administration, Breach Candy Hospital, is of the view that
though costing is done, pricing strategy is not always right. He explains that to fix a price,
costing is done, market price is checked, margin is decided and then finally, revenue is balanced
by varying the price depending on the volumes expected. “So it is the marketing strategy to
underprice or charge high simply to maintain the hospital image,” he adds. But he agrees that
review is not performed for existing services.

The next question is if hospitals should carry out activity-based costing. Says Bagaria, “Although
activity-based costing is desirable, it is currently not being done.” Experts feel that ABC should
be done and it will pay off well. Says Dr Bhatkhande, “ABC will identify the important services
and how much revenue they would generate by charting a servicewise revenue list.”

A report by the US-aided Quality Assurance Project on “Can ABC work in developing countries?”
with Peruvian Healthcare System as the case, says: “Traditional cost accounting methods pool
all indirect costs and then allocate them to the various services in proportion to service direct
costs. This approach tends to overestimate the unit cost of high volume services and
underestimate low-volume services. When indirect costs are large, often the case in healthcare,
the cost of services may be misinterpreted. ABC solves this problem by estimating the cost of
the work activity that consume resources and by linking these costs to the services that are
provided.” And even though the authors say that ABC may be difficult to implement, even in
the US, it is still feasible in a developing country.

With ABC still a long shot, at least methodical pricing should take place. “But the cost structure
is so defective,” says Dr Ojha, “that it is difficult to rectify.” And some, like Bagaria see light at
the end of the tunnel. “We can’t change the system, but insurance companies certainly can,
when their volumes increase,” he hopes.
Standardizing the Hospital Service Pricing.

Few of the medical items like essential drugs are under government control which means that
most of the lives saving drugs have been conserved by the government & all such drugs are
available at a nominal price fixed by the government.

But such steps by the government hardly effect the net effect of out of the pocket expenses
incurred by an average man in India ,government hospitals & network have only covered the
20% of the total healthcare expenses incurred in India.

Government funded schemes like CGHS/ECHS have a standard schedule of charges fixed by the
central government for different categories of cities in India & such rate list are applicable for
any expenses incurred on beneficiary.

But beyond such standardized practice there is hardly any standards for charging by any
common man as there is no defined guidelines on the hospital to charge for services, such
system not only makes it difficult for any patient to be sure of ethical price charged it also
makes difficult for hospitals to have a standardized charging in their system & thus it just on the
mercy of the hospital that how much they may charge for any treatment.

Such baseless system promotes unethical practice and heavily affects the course of treatment
chosen by the patient.

I hope that government (state government) should take initiative to fix the maximum price
applicable for any procedure & service which will not only control the unethical practice but will
also boost the necessary confidence in the patient to undertake treatment in any healthcare
system.
Marketing Mix for Hospital Services in the Globalized Era

ABSTRACT

The industrial revolution of the eighteenth century involved changes not only in manufacturing,
but also in financial structures and in transportation and communication networks.  Without
the existence of two major service sectors namely banking services and transportation, as well
as other services, the economic benefits of large-scale production could never have been
realized.

Since Second World War, there has been a steady decline in the traditional manufacturing
goods; their place has been taken by service-based enterprise.  This shift has been so important
that some refer it as the 'second industrial revolution'.  With the individuals spending greater
portion of their income in transport, entertainment, leisure and communication service and the
line on one hand, and the growing complexity of banking, insurance, investment and legal
services on the other hand indicated the inclination for the service sector to expand.  

Economies of countries such as the USA, UK, Germany, Japan, Canada, Sweden etc., have
moved from being goods dominated to services dominated.  The developed economies also
called as service economies reveal that the service sector accounts for greater employment,
contribution in GDP and more consumption than manufactured goods.

Percentage of GDP Percentage of

Country Environment in
Manufacturing Services
service sector
USA 21 74 80
JAPAN 29 59 60
UK 32 69 77
Australia 22 72 75
Canada 24 70 79
India 29 47 60

(Source:   1998 Statistical year book, Department of International Economic and Social Affairs,
U.N. New York).

Services account for a higher percentage of US GDP than 20 years ago. The current list of
Fortune 500 companies contains more service companies and fewer manufacturers than in
previous decades.

There is an endless list but a general categorization of factors contributing towards the growth
of services.  Desires to live long have resulted in special health care services like nursing homes,
private hospitals, health and fitness clubs. 
INTRODUCTION

Marketing has grown in importance for hospitals, looking to strengthen their position in a
increasingly competitive healthcare market place.

A world class hospital is a multi-disciplinary super speciality medical centre of international

standards.  Most hospitals today are well equipped with the most advanced diagnostic and
treatment facilities.  They try for total health care – preventive and curative.  Most hospitals in
developing counties like India have grown to a truly words class stature over the years.   Some
hospitals have even obtained ISO 9002 certification.  Ex. Mallaya Hospital,  Bangalore.  ISO 9002
quality assurance is a structured and user friendly set of systems, which allows the staff at all
levels of the hospital to follow simple procedures, which make the most complex tasks easy and
efficient.  It frees the senior management of everyday stress in observing and monitoring tasks,
which have to be completed on daily basis.

HOSPITAL MARKETING MIX

PRODUCT

A product is a set of attributes assembled in an identifiable form.  The product is the central
component of any marketing mix.  The product component of the marketing mix deals with a
variety of issues relating to development, presentation and management of the product which
is to be offered to the market place.  It covers issues such as service package, core services and
peripherals, managing service offering and developing service offering.

Hospitals today offer the following services:

1. Emergency services – Emergency services and care at most of the hospitals is unique and
advanced.  The hospitals have state-of-the-art ambulances.  The CCU's on Wheels under
supervision by medical and para-medical staff.  There is hi-tech telecommunication available to
a patient in an emergency at any given time.

2. Ambulance services – Hi-tech ambulances linked by state-of-the-art telecommunications are

fully equipped with doctors that are available to render medical attention and assistance in case
of emergencies at the patient's doorstep.

3. Diagnostic services – Modern Hospitals are multi-speiality and multi-disciplinary, that can
handle any kind of ailment, they offer a wide range of facilities for instance, Oncology,
Orthopedics, Neurology, Plastic surgery and so on.

4. Pharmacy services – Most of the hospitals also have a pharmacy which is open 24 hours.  It
caters to the needs not only of the inpatients and outpatients, but also patients from other
hospitals who require emergency drugs.
5. Causality services – Causality service includes a 24 hrs.  causality department, which attends
to the accident or emergency cases.

Apart from the above mentioned services, hospital also offers "Health Diagnosis Programme"
which is a complete, comprehensive, periodic health check up offered for busy executives,
professionals, business persons and so on.  The health diagnosis programme comprises of the
following:

1. Master health check up

2. Executive Health check up

3. Diabetics health check ups etc.,

Generally, the service offering in a hospital comprises of the following levels:

1. Core level – it comprises of the basic treatment facilities and services offered by the hospital
like diagnostic services, emergency services, casuality services etc.

2. Expected level – it comprises of cleanliness and hygiene levels maintained in the hospital.

3. Augmented level – it comprises of dress code for staff, air conditioning of the hospital, use of
state of art technology, services of renowned consultants.

PRICE

It is one of the most prominent elements in the marketing mix. Price charged must be able to
target customers and it should co-ordinate with other elements of the marketing mix.  Price
usually depends on treatment prescribed by the respective consultants and the facilities offered
to the patient.

As a service is intangible, it is very hard for deciding the price of the particular   service offered. 
Pricing strategy adopted does not depend on the price offered by competitors.  The pricing
strategy is formulated after consulting the concerned heads of department.  Prices of various
facilities revised every year depending on the change in technology.  Before fixing prices,
government controls are also taken into consideration.

On admission, an initial deposit will be collected at the inpatient billing counter.  The amount
extends on the category of room and the treatment or surgical procedure planned.  Various
categories of rooms, ranging from the general ward which attends to the needs of the lower
classes to the deluxe suite which attends to the needs of the middle and upper classes are
available. 
A hospital does not believe in profit maximization, it aims at providing quality service for its
customers at reasonable price.

PROMOTION

Promotion function of any service organization involves the transmission of message to

present, past and potential customers.  Customers need to be made aware of the existence of
the service offered.  Promotion includes advertising, personal selling, sales promotion and
publicity.    

Hospitals do not normally undertake aggressive promotion, they rely a lot on a favourable word
of mouth.  To crease the clientele, a hospital may continuously introduce different health
services like the accupressure clinic, master health programmes and diabetes health checkups
apart from annual health checkups offered to different companies. (Corporate clients) 

Hospitals conduct camps in rural areas to give medical check ups  at a reasonable price so that
the rural people approach the hospital again in the future.  They also sponsor frequent visits to
the spastic society, old age homes, etc.  Hospitals generally advertise in health and fitness
magazines.

PLACE

It refers to contact point between the customer and the service provider, who gets the benefit
of the service.  This element in the marketing mix leads to the identification of a suitable
location.

The two major issues considered regarding the decision of a place are accessibility and
availability of the service to customers.  Accessibility refers to the ease and convenience with
which a service can be purchased, used or received.  Availability refers to the extent to which a
service is obtainable or capable of being purchased, used and received.

Factors influencing the placing decision are market size and structure by geographical regions,
number and types of competitors in the region, location of potentially attractive consumer
segments, local infrastructure, good road access facilities and public transportation network.  A
hospital must be ideally located and must be easily accessible to all.

PEOPLE

The People component reflects the important role played by individuals in the provision of
services.  People are also an important element in the marketing mix.

Service personnel play an important role in an organization which offers service.  The behaviour
and attitude of the personnel offering service will influence the customer's overall perception of
the service.  Customers are a source of influencing other customers by word of mouth.
It is necessary that the staff in hospital are trained to offer quality patient care with human
touch using state of the art technology.

The objective of offering quality service to the patients can be attained by:

o Motivating employees to be efficient, dedicated and loyal to the organization.

o Offering regular on-job training of employees to ensure continuous
improvement in health care.
o Utilizing services of professional competent medical consultants.
o Use of latest technology.        

Motivation is not necessarily by giving high salaries.  There are many other ways to motivate
the employees.  Concessions should be given to the employee's near ones.  There should be
regular liaison with them at all times.  Knowing what the employees want is very important. 
There should be active participation of the employees in the activities of the hospital.

In a hotel, where the clientele is happy, free from any kind of tension, the job of the staff
becomes much easier, whereas in a hospital, the staff has to cater to the needs of sick,
depressed and an agitated lot.  Warm ambiences with efficient and cheerful staff help make the
experience of the public a memorable one.  Therefore, it is very important that the staff of the
hospital is friendly and comforting, always wearing a smile.

PROCESS 

Process is a set of activities that take an input, convert it and add value to the input and finally
create an output.  Process has only recently been given much attention in the service sector
although it has been the subject to study in manufacturing for many years.  Processes are
designed by blue a print, which sets a standard for action to take place and to implement the
service.

In a hospital, the process is divided into three phases.

1. The Joining Phase

It includes the following:

* The arrival of the patient.

* Registration – where a patient has to make an initial deposit at the in-patient billing counter
after which a file is opened in the patient's name to know the patient's medical history.

2. The Intensive consumption Phase

It includes the following: 

Diagnosis – where the consultant diagnoses the illness by making the patients undergo various
tests.

Treatment – when the illness is treated with proper medication or surgery and so on.

Information about further actions – the consultant will instruct the patient regarding the diet to
be followed, the medication to be taken, when to consult him again in the future and so on.

3. The detachment Phase

It includes the following: 

* Discharge of the patient – a patient can be discharged from the hospital on the advice of the
consultant

* Payment – after the patient is discharged, the bill will be paid at the billing counter.

4. Feedback

At this stage, the patient is requested to fill an evaluation form, which assists the hospital
authorities to know the level of satisfaction derived by the patient.  Patients' suggestions are
always welcomed, valued and considered and many times are very useful for improving the
services of the hospital.

General Process Organization in a Hospital

Within the hospital, it each department is looked, it is noticed that each department serves the
needs of another department, for example, the purchase department serves the needs of the
stores, the billing department serves of the finance department and so on.  So in a way, each
department is a customer to another department, while at the same time it might be a supplier
to another department.  Each department is an "internal customer" or the other departments.

Only when each unit of the hospital understands who their customers are and what their needs
are, will the hospital develop basis for giving the best service in the most efficient way to the
patient.

In a way, each department or unit should consider itself to be a service provider serving the
needs of the customer department.  In a superficial level, it may seem as if each department is
working as an independent unit rather than a team.  However, the world-over in many
organizations that have used this concept, it has found that this kind of a customer-supplier
relationship helps to offer an important system of checks and balances and gives the
organization a more focused customer orientation.

PHYSICAL EVIDENCE

It is the environment in which the service is delivered with physical or tangible commodities
and where the firm and the customer interact.  Physical evidence plays an important role in
hospital services.

It makes a huge impact on the customer.  Physical evidence offers customers means of
evaluating the service.  Corporate image plays in important role in terms of physical evidence. 
This can be developed through corporate relation programmes.

Modern hospitals need to create a good ambience.  Right from the reception one finds very
cordial and comforting staff.  The ambience plays an important role because when a patient
walks into the hospital he immediately forms an opinion about the hospital.

The staff follows a dress code to show professionalism and to maintain discipline.  The staff is
trained to be understanding, warm and comforting because the clientele that goes to the
hospital is usually disturbed or unhappy.

It is necessary for a hospital to be well organized and segregated into different departments. 
All the doctors should be offered with a well-equipped cabin.  The entire hospital requires to be
centrally air-conditioned with good lighting.  Ventilation is taken care of by air-conditioning.

Special care should be taken to maintain hygienic, cleanliness and whole hospital must be well
lit.  This is taken care of by the housekeeping department.  A hospital has to keep in mind both
the aspects of physical evidence that is essential and peripheral evidence.  Physical evidence
particularly plays an important role in the hospital where the patients are already depressed or
traumatized and a good atmosphere could make all the difference.

CONCLUSION

Marketing is a function by which a marketer plans, promotes, and delivers goods and services
to the customers.  In the services marketing, the providers are supposed to influence and
satisfy the users.  When people buy services offered by a service provider in a true sense, they
buy the time, knowledge, skill or resources.  Marketing the service is meant marketing
something intangible.  It is like marketing a promise.  The applications of marketing principles in
the services sector are the main things in the services marketing.  It is the managerial process of
managing the service.