BUSINESS AND ADMINISTRATION

JANUARY 2020

BBPS4103

STRATEGIC MANAGEMENT

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MATRICULATION NO : 891016145928001
IDENTITY CARD NO. : 891016-14-5928
TELEPHONE NO. : 016-333 6704
E-MAIL : losni.m@maybank.com.my
LEARNING CENTRE : SHAH ALAM LEARNING CENTRE
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TABLE OF CONTENT
No Title Page
ASSIGNMENT 1
1.0 Introduction 3-5
1.1 Open University Malaysia (OUM) 3
1.2 Wawasan Open University (WOU) 4

1.3 Asia e-University (AeU) 5

2.0 Critical Success Factors of OUM, WOU and AeU 6 – 11
2.1 Open University Malaysia (OUM) 6–7
Figure 1: OUM’s Collaboration with International Partners Data as at December 2019 6
2.2 Wawasan Open University (WOU) 8–9

2.3 Asia e-University (AeU) 10 – 11

Figure 2: The unique positioning of AeU within the government 11
3.0 Competitive Profile Matrix 12 – 14
Figure 3: Competitive Profile Matrix (OUM, WOU and AeU) 12
3.1 Analysis of Competitive Profile Matrix (CPM) 13
Figure 4: The current ODL model of OUM 13
4.0 Summary on overall findings 15
ASSIGNMENT 2
Introduction of KPJ Healthcare Berhad Including Its Vision and Mission Statements,
1.0 16 – 19
Objectives and Short-Term and Long-Term Goals
1.1 About KPJ Healthcare Berhad (Figure 1: Logo of KPJ Healthcare Berhad) 16
1.2 Vision & Mission 17
1.3 Short-term & Long-term goals 18 - 19
SWOT analysis, Internal Factor Evaluation (IFE), External Factor Evaluation (EFE) and
2.0 20 – 24
Competitive Profile Matrix (CPM) of KPJ Healthcare Berhad
2.1 SWOT analysis 20 – 23
2.2 Internal Factor Evaluation (IFE) of KPJ Healthcare Berhad 24
2.3 External Factor Evaluation (EFE) of KPJ Healthcare Berhad 24

2.4 Competitive Profile Matrix (CPM) 24

3.0 Financial positions of KPJ Healthcare Berhad and annual report for year 2017 & 2018 25 - 32
Table 1: Statements of Financial Position (Annual Report Year 2017-2018) 25
4.0 Strategic Positions of KPJ Healthcare Berhad 33
Assignment 1

1.0 Introduction

Higher education system in Malaysia is divided into two categories of education institutions as
the providers to support the distance education sector. The first category refers to institutions of
dual mode. In addition to conducting regular campus-based and classroom-type courses, the
dual-mode institutions also offer programs via distance learning. Included in the first category
are the majority of the twenty public funded universities which include Universiti Sains
Malaysia (USM), University Teknologi Mara (UiTM), University of Malaya (UM), and

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Universiti Putra Malaysia (UPM), and at least two private universities that are Multimedia
University (MMU) and International Medical University (IMU). The second type of higher
education institutions refers to the single-mode open distance learning (ODL) institutions
which are privately funded and which conduct all their courses and programs via distance
learning. There are currently four ODL universities in the country, three of which are Open
University Malaysia, Wawasan Open University, and Asia e-University.

1.1 Open University Malaysia (OUM)

Open University Malaysia (OUM) was established based on the concept of providing higher
education using the latest Internet technology, thereby allowing access to education for all.
OUM is a private education provider and plays a vital role in encouraging innovation in course
delivery, assessment methods and higher education curricula. It was established on August, 10,
2000 under the Private Higher Education Institutions Act 1996 to fulfil the country’s aspiration
to increase education opportunities for the people, especially working adults. OUM is the
seventh Malaysian private university which is owned by the Multimedia Technology
Enhancement Operations (METEOR) Sdn. Bhd., a consortium of 11 public universities. The
main campus of OUM is located at Jalan Tun Ismail, Kuala Lumpur. In addition to this, there
are additional 37 learning Centre’s throughout Malaysia, out of which 10 are regional learning
Centre’s.

1.1.1 Vision

To be the leading provider of flexible learning.

1.1.2 Mission

To widen access to quality education and provide lifelong learning opportunities by leveraging
on technology, adopting flexible mode of learning, and providing a conducive and engaging
learning environment at competitive and affordable cost.

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1.2 Wawasan Open University (WOU)

The vision of Wawasan Open University (WOU) is to be a vibrant community that inspires
lifelong learning, supports innovation and nurtures all-round personal growth. This vision is
clearly reflected in its mission statement which declares that the University is committed to the
expansion of opportunities in higher education and to teaching excellence aimed at increasing
the level of knowledge and scholarship among all Malaysians. Owned by the Wawasan
Education Foundation, WOU offers accessible, flexible and affordable education to the adult
community in support of lifelong learning. At WOU, quality underpins and undergirds
everything it does. WOU benchmark its academic programmes, courses, course materials and
the entire learning process to produce well-rounded, knowledgeable, competent professionals
against international best practices.

A distinctive characteristic of the ODL system is its learner-centric form as against a

teachercentric form of education used in a conventional university. Over 10,000 people in
Malaysia, ranging in age between 21 and 71 years, have experienced the learning opportunities
at WOU with majority of them falling within the 21 – 30 age groups. Currently there are 44
programmes offered by the four Schools of the University – the School of Business and
Administration, School of Science and Technology, School of Foundation and Liberal Studies,
and the School of Education, Languages and Communications.

1.3 Asia e-University (AeU)

Asia e-University (AeU) opened its door in 2007 with its learning centre located in Kuala
Lumpur. AeU is a unique collaborative multinational university designed on the concept of
open and distance learning (ODL) system which provides flexible learning opportunities to
learners in terms of time and place. To date, AeU is supported by 34 member countries of Asia
Cooperation Dialogue (ACD) to cater to the rising market demand for continuing education
from adult learners in Asia.

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The university is a member of the Association of Commonwealth Universities and other
international higher educational organizations. The small letter "e" in the name of the
university represents empowered learning, enhanced learning, exploratory learning, expanding
learning, effective learning, electronic learning, experiential learning and entrepreneurial
learning which attribute the university's missions and visions.

2.0 Critical Success Factors of OUM, WOU and AeU

2.1 Open University Malaysia (OUM)

2.1.1 International partnership and collaboration

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The demand for cross-border collaborations has increased with the internationalisation of
higher education (Kosmützky, 2015) through twinning, franchised programmes, online and
distance education, or international branch campuses. The details of international partners
involved in collaboration with OUM are shown in Table 1 below:

Figure 1: OUM’s Collaboration with International Partners Data as at December 2019

OUM entered
into its first international collaboration with Arab Open University in 2007 and the latest
collaboration in place is with International College of Law, Business Administration and
Technology from United Arab Emirates in August 2017. All the collaborations are initiated
with the signing of a Memorandum of Agreement (MoA) for a five-year period.

2.1.2 Brand reputation and identity

OUM is well recognised as the pioneer of ODL education provider in Malaysia. The brand
reputation and identity of OUM as the pioneer in the country in providing education to working
adults using the latest technology compatible with e-learning and e-teaching reflects the critical
success factor of the university. Being the first university to practice ODL in Malaysia, the
establishment of OUM with its motto, “Education for All” marked a new beginning for the
democratisation of education in Malaysia. This indeed allows a paradigm shift in the country’s
higher education environment permitting a larger number of working adults to continue their
search for knowledge and higher levels of competency in OUM (Chiam, Lim, Phang, 2012).

2.1.3 Mode of delivery

OUM offers a blended learning mode that combines printed learning materials as the main
learning resources supplemented by face-to-face interactions at regional Centre’s and elearning

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through a specially designed Learning Management System (LMS) (Ali, 2005). Through e-
learning, ICT is used to connect learners and tutors who are located apart from each other for
the face-to-face learning sessions.

OUM also has developed a unique system for teaching and learning online. This system
enables learners and tutors to interact online. MyVLE allows the integration of various features
such as instructor’s and students’ tools, technical support, administrative tools and functions
that facilitate the teaching and learning process (OUM, 2005). It enables them to self- manage
their learning. This innovative practice gives meaning to the phrase “democratisation of
education”, which is one of the objectives of setting up open universities in Malaysia.

2.1.4 Student’s accessibility and reachability

Another critical success factor for OUM is the fact that the university is easily accessible and
reachable by its students across Malaysia. Currently, more than thirty learning Centre’s which
are located in every states in Malaysia except Perlis, have been established throughout
Malaysia to provide learning facilities to learners of OUM. These learning Centre’s are well-
equipped with tutorial rooms, computer labs, meeting rooms and reading areas.

2.2 Wawasan Open University

2.2.1 Service delivery quality

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Education is a service-oriented industry. Delivering a high level of service quality to clients is
important to service organisations, including higher education institutions (Brochado, 2009).
Service quality has been identified as a robust predictor of student satisfaction (Helgesen &
Nesset, 2007). Higher education institutions have to make sure their products are industry-
relevant and supported by excellent service standards which differentiate them considering that
there are over 600 higher learning institutions in the country which all offer almost similar
programmes. What is not similar is how these institutions deliver their products and services to
their clients.

WOU benchmarks its academic programmes, courses, course materials and the entire learning
process against international best practices in order to produce well-rounded, knowledgeable
and competent professionals. To ensure its service delivery quality, WOU has also put in place
several quality assurance procedures. One of which is by developing an overarching policy
document, entitled the Standard Operating Procedures (SOP) Framework that requires all
schools/departments to document their respective processes and procedures based on a
prescribed format. The Quality Assurance Unit maintains a record of all the university SOPs,
which is easily accessible and regularly updated (Liew & Teoh, 2012).

2.2.2 Diverse teaching and learning methods

Learning outcomes are sets of competencies, expressing what the learner will know or be able
to do after the successful completion of learning process (Dillon, Hengst, & Zoller, 1991).
Credits are obtained after passing the appropriate assessment for each course. In WOU’s ODL
model, the role of lectures is replaced by providing students with a set of course materials (in
print or CD and accompanied by textbooks as appropriate) that are designed for self-learning.
The development of course materials is carried out using a team approach. Typically, a Course
Development Team (CDT) consists of the School’s academics, Instructional Designers from
ETPU, external academic content experts (writers) and, where appropriate, web
designers/programmers as well as language editors (Singh & Abeywardena, 2010).

2.2.3 Market and societal considerations

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As a private not-for-profit institution, the development and delivery of each WOU programme
is very much driven by market and societal demands. The Schools and the Marketing Unit of
the university regularly conduct market survey as well as gather feedback from various
channels. These include (Singh & Abeywardena, 2010):

i. Feedback from WOU Council members

ii. Feedback from members of the School’s APG
iii. Feedback from Regional Offices of WOU
iv. vi. Dialogues with professional organizations

2.3 Asia e-University

2.3.1 Global recognition and presence

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AeU is a unique collaborative multinational university initiated by the Asia Cooperation
Dialogue (ACD), a body established in 2002 to promote Asian cooperation at a continental
level. The University is established as the Malaysian Government initiative and prime mover to
champion e-Education, affirmed at the ACD Ministerial Meetings in Islamabad (2005) and
Doha (2006) and supported by 34 ACD member countries. It collaborates with Institutions of
Higher Learning (IHLs) and Training Centre’s in the ACD member countries to offer quality
and affordable academic degree and professional training programmes. AeU acts as a
facilitator and enabler for IHLs in Asia on mutual accreditation and recognition of the
academic degree and professional programmes and leverage on the sharing of resources and
facilities.

2.3.2 Government support

Since its establishment, AeU has received strong government support in its operation
considering that the university was a government-backed attempt to enable domestic
universities to offer their growing array of online degrees to wider audiences. Due to this, AeU
has been actively supported by the government in its attempt to increase the e-Education
opportunities to the Malaysian. The unique positioning of AeU can be seen in the illustration
below whereby the Ministry of Higher Education, Ministry of Finance, and Ministry of Foreign
Affairs formed the principal stakeholders of AeU.

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For example, AeU was selected as ‘the Gateway University for International Education for
distance and online learning, with a projected GNI of RM100 million, by the Ministry of
Higher Education under the Economic Transformation Programme (ETP) in 2010.

Figure 3: Competitive Profile Matrix (OUM, WOU and AeU)

Figure 2: The unique positioning of AeU within the government

3.0 Competitive Profile Matrix

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3.1 Analysis of Competitive Profile Matrix (CPM)

Based on the CPM tabulated for the ODL institutions above, it is evident that OUM received
the highest weighted score of 3.53 as compared to its competitors, WOU and AeU, with
weighted score of 2.85 and 3.20 respectively. According to David (2011), CPM identifies a
firm’s major competitors and its particular strengths and weaknesses in relation to a sample
firm’s strategic position. Based on the CPM constructed, an analysis of the competitiveness for
each institution as compared to the other two will be made based on the critical success factors
used in the CPM which will further simplify into a few broad categories.

3.1.1 Teaching and learning environments

The critical success factors included under the teaching and learning environment category are
the mode of delivery, service delivery quality, diverse teaching and learning methods as well
market and societal considerations. In terms of mode of delivery and diverse teaching and
learning methods, OUM managed to score higher than WOU and AeU. This is based on the
fact that the mode of delivery in OUM is more diverse and comprehensive as compared to the
other two institutions. The below illustrate the comprehensive ODL model that is currently
adopted by OUM:

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Figure 4: The current ODL model of OUM

3.1.2 Support systems

The second broad category for the analysis is the support system category under which the
factors of student’s accessibility and reachability as well as government support are contained.
For the student’s accessibility and reachability factor, OUM received the highest rating of 4
while WOU and AeU received a rating of 2 and 3 respectively. In terms of government
support, AeU received the highest rating for the factor considering that AeU was established
under the effort and initiative of the government through its Ministry of Foreign Affairs. AeU
also has engaged in various partnerships with the government including the sponsors that it
receives from the Ministry of Higher Education with regards to the program of upgrading the
qualification of primary school teachers as well as selected as the ‘gateway university’ under
the Economic Transformation Programme (ETP).

3.1.3 International penetration

The third category to be analysed is the international penetration categories. The CSFs
included under this category are international partnership and collaboration as well as global
recognition and presence factors. For international partnership and collaboration, OUM and
AeU were both rated as 3 meanwhile WOU was rated as 2. This is based on the fact that OUM
and AeU has involved in a significant number of international partnership and collaboration as

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compared to WOU. Meanwhile, for the global recognition and presence, AeU was rated with
the highest rating of 4 while OUM and WOU was rated with a rating of 3 and 2 respectively.
Among the three institutions, AeU has received the widest and highest global recognition and
presence considering that AeU was recognized and approved by the ACD and supported by 34
countries which are the members of ACD.

3.1.4 Brand reputation and identity

The last category for the analysis is the brand reputation and recognition. In this category,
OUM managed to receive the highest rating of 4 as compared to WOU and AeU which are
both rated as 3. With a total of 180,000 learners and 74,000 graduates, OUM has managed to
place its brand at the forefront of the ODL institutions in Malaysia. As mentioned earlier, ICT
and ODL have become synonymous with the way OUM operates its programmes (UNESCO,
2010). In fact, OUM itself has marketed its institutions as the “No. 1 part-time study university
in Malaysia” which subsequently strengthen its brand reputation and identity as the pioneer
and leader of the ODL sector in Malaysia.

4.0 Summary on overall findings

The report has attempted to discuss the critical success factors and competitiveness of the three
leading ODL institutions in Malaysia namely OUM, WOU, and AeU by tabulating the CPM to
determine the competitive advantage of these institutions based on their respective critical
success factors. The rapid expansion of the Internet as a potential course delivery platform,
combined with the increasing interest in lifelong learning and budget restrictions, has created a
significant incentive for the rapid establishment of ODL institutions in Malaysia and
understanding the competitive advantage of each institution is therefore vital for the survival
and success of these institutions. This can be done by utilizing CPM considering that it is an
important tool that serves as a basis of a firm’s strategy which gauges the competitiveness of a
firm in comparison with their closest competitors in the industry.

Based on the tabulation of weighted score in the CPM, it is evident that OUM has received the
highest weighted score of 3.53 as compared to 2.85 received by WOU and 3.20 received by
AeU. For the purpose of analysing the weighted score obtained from the CPM, the critical
success factors have been further categorized into four broad categories namely:

(1) teaching and learning environments;

(2) support systems;

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(3) international penetration; and

(4) brand reputation and identity.

From the tabulation, it can be concluded that OUM is more competitive as compared to WOU
and AeU in the all of the broad categories mentioned above, with an exception of the
international penetration category where AeU received higher weighted score than OUM in the
category.

In conclusion, firms should pay close attention to critical success factors and use those factors
with much care to identify the gaps in the value creation and tap the opportunity to outperform
their rivals from a competitive scenario aspect. Once the firms are able to identify those factors
and put this information into developing a CPM, they can easily find the gaps in the market in
terms of value creation and act quickly to close them.

(Total words 2796)

Assignment 2

1.0 Introduction of KPJ Healthcare Berhad Including Its Vision and Mission Statements,
Objectives and Short-Term and Long-Term Goals

1.1 About KPJ Healthcare Berhad

Figure 1: Logo of KPJ Healthcare Berhad

KPJ Healthcare Berhad (KPJ) is the country’s

largest private healthcare providers in the region with a network of 22 private specialist
hospitals in Malaysia. KPJ also has a presence in Indonesia with 2 hospitals in Jakarta, one

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hospital in Thailand and a retirement and aged care resort in Brisbane, Australia. With more
than 2,600 licensed beds, KPJ hospitals offer a comprehensive range of medical services and
have treated more than 2.5 million patients annually. In 2012 alone, KPJ hospitals hospital’s
treated about 2.4 million outpatients and over 250,000 inpatients.

1.2 Vision & Mission

KPJ's Corporate Vision: The Preferred Healthcare Provider

 Leveraging on dynamic partnerships, a shared ambition to build healthier communities and
a steadfast commitment to “Care for Life”
 In line with its Vision, KPJ offers a specialized medical solutions that transcends borders
and cultures while covering the entire patient life cycle from pre-natal to geriatric care, as
it aspires to be the lifelong companion to the patients throughout their healthcare journey.
 The company’s purpose is ensuring the growth and strength of KPJ over the years through
creative and innovative strategies have enabled the organization to move forward in
driving standards and continuous innovation.

KPJ's Corporate Mission: Deliver Quality Healthcare Services

 In tandem with KPJ’s Mission, it is committed to delivering world-class patient care with
professionalism and an undivided compassion to the many communities that they serve.
 The provision of quality healthcare services through continuous improvements in patient
care and outcomes too remains a priority. KPJ has a dedicated team of some 9,000
employees who have wholeheartedly embraced the Group’s culture of excellence and have
been empowered with the skills to enhance patient care throughout the network.
 The Business “Jihad” was interpreted from the “Jihad” war where energy and motivational
forces were harnessed, mobilized and channeled towards peace and prosperity that

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translate the best that Islam can offer in values and civilization terms to the world we
live in.

1.3 Short-term & Long-term goals

KPJ's Short-term goals

Continuous Improvements in Customer Services

KPJ also developing a culture of continuous customer service improvements throughout their
hospital network with our Service Quality Management (SQM) system, which requires all their
hospitals to submit their service initiatives on an ongoing basis. Within the SQM system, their
Patient Communication Management System was enhanced with a new reporting module by
end of 2020.

Upgrading of IT Infrastructure and Systems Improvements

KPJ in a mist of investing RM30 million for IT expenditure. This covers several areas such as
Cloud Computing, Information Security and Cyber security, Disaster Recovery and Failover
System for Business Continuity and Technology Refresh for existing hospitals.

Sustaining Talent Management Agenda

Good care has been taken to introduce strategic plans to strengthen the team, create sustainable
career development opportunities and improve human resource (HR) processes to make
integrated systems much easier to implement. These include leave applications, training

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programmes and schemes, employees’ declaration of assets and the evaluation of their
performance, all of which is primarily conducted online.

Maintaining Hospital Network Expansion Strategy

In the south, KPJ Bandar Dato’ Onn in Johor is scheduled to operate by third quarter 2020 after
this CORONA pandemic over. The hospital in Bandar Dato’ Onn is KPJ’s sixth hospital in
Johor. It was completed on time, despite the many challenges.

KPJ's Long-term goals

Innovation-led Transformation
Innovation Centred Culture Ongoing commitments to create, develop and nurture an
innovation-led work culture is borne through a number of initiatives aimed at bringing their
people on board and ensuring we are all on the same page.

Expanding Medical Tourism Reach and Market

Medical tourism is one of the healthcare niches KPJ has identified as a key enabler to sustain
their long-term growth. The Ministry of Tuvalu has appointed KPJ Hospitals as their preferred
healthcare provider for its citizens by sending complicated cases ranging from cancer,
orthopaedics, neurology, bariatric and eye surgeries.

Adopting Innovations in Medical Technology (MedTech)

A game changer for KPJ by 2021 by the adoption of IBM Watson for Oncology, a cognitive
computing platform for KPJ oncologists to utilise, as a decision - making support system in
designing treatment plans for cancer patients. KPJ is the first private healthcare provider in
Malaysia to bring in and utilise the Watson for Oncology platform.

Online Pharmacy

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The year under review saw KPJ launching our e-pharmacy, KPJ Healthshoppe (KPJHS) which
is currently offering over the-counter products online. Having built the foundation for by 2021,
their medium- to long-term plan is to extend our capacities to subsequently provide e-
prescription services.

2.0 SWOT analysis, Internal Factor Evaluation (IFE), External Factor Evaluation (EFE)
and Competitive Profile Matrix (CPM) of KPJ Healthcare Berhad

2.1 SWOT analysis

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Strength

Brand and reputation

One of the largest private hospital operators with an established branding in Malaysia, KPJ is a
well-established household name in Malaysia Private healthcare sector.

Strong market position /market leadership

KPJ operates the largest private hospital network in Malaysia with 23 hospitals with over 2,600
licensed beds. It is estimate that KPJ has a leading 20% share of private hospitals bed in
Malaysia and leading 25% share of private inpatient admission. (Standard Charted Analyst,
2012).

Strong relationship with doctors

KPJ healthcare had 750 medical consultants, which translates to a 7% share of private doctors
in Malaysia. KPJ has established and reputable system in place for centralized payment and
billing, helping it in recruitment of doctors. (Standard Charted Analyst, 2012)

Commitment in providing quality care

The corporate mission of the group is to deliver quality healthcare service this shows the level
of the commitment of KPJ to quality care.

Major Specialist Services

KPJ offers a wide range of services like specialist services, cardiac services, cosmetic and
reconstructive services, ophthalmology services, oncology, chemotherapy and radiotherapy,
orthopedic and sports injury, obstetrics and gynecology services, pediatric and neonatal
Services and surgical and critical care.

Customer satisfaction

The reason why customers prefer KPJ is because they have attractive customer care slogan for
instance doctors to nurse and staff moved from being caregiver to being a caring giver, KPJ is
committed to given all its customers an awesome service experience during their stay and visit
to KPJ.

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Philanthropic /CSR activities

KPJ Plays role in promoting health awareness to the large. As part of it is CSR activities KPJ
provide free medical camps in rural areas, conduct baby wellness program and health life style
campaign as well as established support group community outreach program.

Private Nursing colleges

Nurses can be easily available to KPJ as they can be easily be sourced from its college.

Information & Communication Process

KPJ has successfully implemented the KPJ clinical information system (KCIS), this new
system include medical care solution for patient management , nursing care solution, patient
information can be easily shared throughout the group and facilitates patient transfer from one
hospital to another.

Strong financial support from parent company

KPJ gets financial support from the parent company Johor Corporation, is indisputably one of
the most successful corporate organizations in Malaysia. The remarkable success of Johor
Corporation, in developing Johor into a thriving industrial state has become a model for state
development programs in the country.

Weaknesses

Perishable medicine expiration

Medicine cannot be used after expiry date, inventory management of medical products raises
particular challenges, as medical inventory is highly sensitive to storage temperature, humidity
etc.

Liquidity issues

KPJ have cash problems liquidity this will slow the day to day operations of the hospitals and
cash is needed in every transaction.

Information Technology

All KPJ hospitals don’t have the KPJ clinical information system (KCIS), this weakness can
slow down the operations of the various hospitals.

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Opportunities

The demand for health care is growing rapidly in Malaysia

Currently the people who care about their health increased than before in Malaysia and around
the world so the increase of people who care about their health will help the hospital to expand
their business and this will increase the income of the hospital.

Medical tourism

Malaysia government has plan to spur growth in medical tourism market. Although this plan is
has just started and not in the robust growth yet however could be a significant if success
(Morgan JP, 2012).

Overseas market

The majority of Malaysia's neighbours are not sophisticated like Malaysia in terms of medical
progress and medical advances, but nowadays these countries is growing strongly and this will
help KPJ to open more branches.

GDP growth rate is high in Malaysia

Malaysians economy is doing well and Malaysian income levels rise in tandem with the
country’s progress. Better education, longer life span and a desire for a better lifestyle also
make them more willing to spend more on healthcare.

Threats

Competitors

Other rival company such as Pantai and Columbia has been aggressively expanding around
Malaysia in an attempt to seek a bigger slice of Malaysia's healthcare pie. (Morgan JP, 2012).

Limited supply of qualified medical personnel

There is shortage supply of qualified doctors and nurses to cater to the growing demand for
healthcare services in Malaysia thus may delay expansion plans KPJ healthcare. (Standard
Charted Analyst, 2012).

Availability of low cost healthcare equipment

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Currently, there are many companies that manufacture health products that assist the patient in
his/her home and does not need to go to the hospital and this will be affected negatively to the
hospital, because may some of customers will not go to the hospital only if they are in the
critical situation.

2.1 Internal Factor Evaluation (IFE) of KPJ Healthcare Berhad

Shortage of experienced medical doctors and nurses will be seen as hindrance against any
expansion plan for KPJ Healthcare Berhad, as well as existing services offering.

Local doctors and specialists are choose to adopted for oversea that have better remuneration
packages and quality of life, similarly for many highly qualified nurses also choose to higher
remuneration offers country like in the Middle East.

2.2 External Factor Evaluation (EFE) of KPJ Healthcare Berhad

One of major threat of KPJ Healthcare Berhad is the competitive demand and shortage of
medical human resources in healthcare industry, this brain drain problem where lack of
qualified doctors, specialists and experienced nurses keep continuing with opening of new
private hospitals.

Competition among private hospitals will be challenging which will become more demanding
and complex in achieving its organization performance, as such, KPJ Healthcare Berhad must
have strategic plan management with more creative and innovative in order to remain
competitive and sustain their competitive over others in this industry.

2.3 Competitive Profile Matrix (CPM)

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Based on the tabulation of weighted score in the CPM, it is evident that KPJ has received the
highest weighted score of 3.5 as compared to 2.86 received by Pantai and 3.201 received by
Columbia. From the tabulation, it can be concluded that KPJ is more competitive as compared
to Pantai and Columbia in the all of the broad categories mentioned above, with an exception
of the intensive national network category where Columbia received higher weighted score
than KPJ in the category.

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3.0 Financial positions of KPJ Healthcare Berhad and annual report for year 2017 & 2018

Table 1: Statements of Financial Position as at 31 December 2018 (Annual Report Year 2017-2018)

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In my opinion, the financial statements of KPJ Healthcare Berhad (“the Company”) and its
subsidiaries (“the Group”) give a true and fair view of the financial position of the Group and
of the Company as at 31 December 2018, and of their financial performance and their cash
flows for the year then ended in accordance with Malaysian Financial Reporting Standards,
International Financial Reporting Standards and the requirements of the Companies Act 2016
in Malaysia.

Property, plant and equipment

The Group’s land and buildings, except for those under constructions, were fully revalued as at
31 December 2015. As at year end, the Group assess whether there is an indication that the
carrying values of these assets have defer materially from its fair value. Where an indication
exist, revaluations were carried out and the carrying value of these assets were updated to
reflect its fair value based on independent valuation. Certain land and buildings that were
completed and commenced operations during the year were also revalued as at year end.

Carrying value as at 31 December 2018 of RM238, 000,000 (2017: RM209, 828,000)

Investment Properties
A sensitivity analysis has been performed on the significant assumptions that impact the fair
value of the office properties. Arising thereof, the impact of a 10 basis points increase/decrease
in the term yield will result in a lower/higher fair value change by RM22 million and RM27
million, while a void rate of 12.5% will result in a lower fair value change by RM5 million.

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Intangible Assets
The Directors have determined the revenue and EBITDA margin based on expectations of
market development. The terminal growth rate does not exceed the long-term average growth
rate for the relevant group of CGUs.

Investments in Subsidiaries
Summarised financial information of Perdana Specialist Hospital Sdn Bhd, Selangor Specialist
Hospital Sdn Bhd and Lablink (M) Sdn Bhd which have non-controlling interests that are
material to the Group is set out below. Summarised Statements of Financial Position
(Investments in Subsidiaries).

Investments in Associates
Summarised financial information in respect of the Group’s material associate is set out below.
The summarised financial information represents the amounts in the statutory financial
statements of the associate and not the Group’s share of those amounts. Summarised
Statements of Financial Position (Investments in Associates).
Available-For-Sale Financial Assets

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Equity Instruments Classified as FVOCI

Equity investments at FVOCI comprise of the following individual investments:

Deferred Tax
Deferred tax assets and liabilities were offset when there is a legally enforceable right to set off
current tax assets against current tax liabilities and when the deferred taxes relate to the same
tax authority. The following amounts, determined after appropriate offsetting are shown on the
statements of financial position.

Inventories

Trade and other receivables and amount due from Subsidiaries

Credit terms of trade receivables range from 30 to 60 days (2017: 30 to 60 days).
Amounts due from ultimate Holding Corporation and related companies are interest free and
repayable on demand. Amount due from subsidiaries are unsecured, bearing interest rate of
3.7% (2017: 3.7%) per annum and with no repayment terms.

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As at 31 December 2018, trade receivables of RM40, 859,000 (2017: RM44, 873,000) were
impaired and provided for. Movement in allowance accounts:

Deposits, Bank and Cash Balances

The weighted average interest rate of deposits with licensed banks of the Group during the
financial year is 2.90% (2017: 2.90%) per annum. Bank balances are deposits held at call with
banks and earn no interest.

Deposits of the Group and of the Company have maturity period that ranges from 1 to 365 days
(2017: 1 to 180 days). Deposits, cash and bank balances as at end of the reporting period are
denominated in the following currencies:

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Assets Held for Sale
As at 31 December 2018, the disposal groups include Medical Supplies (Sarawak) Sdn Bhd, a
subsidiary of the Group, to a third party which has been identified as at year end. The parties
involved are currently finalising the terms in the share sale agreements. Property, plant and
equipment include disposal of a warehouse belonged to FP Marketing (S) Pte Ltd, a subsidiary
of the Group, to a third party which has been identified as at year end. The Directors are of the
view that the above transactions are expected to be completed within the next 12 months.

Trade and other payables and amount due to subsidiaries

Non-current other payables comprises of retention sum that is not repayable in the next 12
months. Included in amounts due to subsidiaries are advances from subsidiaries which are
unsecured and bear an effective weighted average interest rate of 5.85% (2017: 5.85%) per
annum and are not repayable in the next 12 months.

Credit terms of trade payables ranges from 30 to 60 days (2017: 30 to 60 days). Payables are
denominated in the following currencies:

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Contract Liabilities

Contract liabilities which consist of the amount of deposit received from patients, the wellness
subscription fees and tuition fees at the inception of the contract which services have not been
rendered. Revenue is recognised as and when the performance obligations are satisfied. The
balance was previously recognised as deferred revenue.

Provision for Retirement Benefits

The Group operates an unfunded lump-sum benefit plan for eligible employees at a subsidiary
company. The movements during the financial year in the amount recognised in the statement
of financial position are as follows:

Deposits
Deposits represent amounts received from consultants, which are repayable on death,
retirement (at age 65) or disability of the consultants.

Share Capital

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As at 31 December 2018, the Company held a total of 115,197,500 of its 4,399,148,119 issued
ordinary shares as treasury shares. Such treasury shares are held at a carrying amount of
RM11, 318,576.

4.0 Strategic Positions of KPJ Healthcare Berhad

KPJ’s basis in conducting the subdivision of shares exercise was to reward our shareholders for
their loyalty and continuing support through greater equity participation in terms of number of
shares held, whilst maintaining their percentage of equity interest. It was also to improve the
trading liquidity of KPJ shares so that a wider spread of investors could participate in the
growth and capital appreciation potential of the new subdivided shares. Moreover, it provided a
cheaper entry point for small and retail investors as a result of the adjustment of KPJ’s share
price pursuant to the subdivision of shares exercise.

As of 2018, our sustainability strategy is drawn up by the risk and sustainability committee,
and is closely aligned with the group’s risk management process. This approach ensures that
we remain on track with our seventh strategic thrust of creating sustainable value for our
stakeholders, which is underpinned by the sustainability development agenda and our
commitment to embed it into the heart of how we do business.

(Total words 2995)

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References

Assignment 1

Journals

 Asia eUniversity (AeU). (n.d.). Learning centres. Retrieved 19 June 2019

 Brochado, A. (2009). Comparing alternative instruments to measure service quality in
higher education. Quality Assurance in Education, 17(2), 174 – 190.
 Chiam, C. C., Lim, T. M., & Phang, S. M. (2012). Innovative practices in ODL – the
experience of Open University Malaysia. Asian Association of Open Universities
Journal, 7(1), 79-85. doi: 10.1108/ AAOUJ-07-01-2012-B007.
 Dillon, C. L., Hengst, H. R., & Zoller, D. (1991). Instructional strategies and student
involvement in distance education: A study of the Oklahoma televised instruction
system. Journal of Distance Education, 6(1).
 Hazalina Hashim. (2017). The expansion of Open University of Malaysia through
international collaboration. ASEAN Journal of Open Distance Learning, 9(2), 7-14.
 Kosmützky, A. (2015). In defence of international comparative studies. On the
analytical and explanatory power of the nation state in international comparative higher
education research. European Journal of Higher Education, 5(4), 354-370.

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 Liew, T. K., & Teoh, A. P. (2012). Assuring the quality of online teaching and learning:
The case of Wawasan Open University. Asian Association of Open Universities
Journal, 7(1), 13-33. doi: 10.1108/ AAOUJ-07-01-2012-B002.
 Open University Malaysia (OUM). (n.d.). Learning centres. Retrieved 19 June 2019

Websites

 https://aeu.edu.my/discover/learning-centres/
 https://www.oum.edu.my/learningcentres/

Assignment 2

Journals

 Alias M, Mahjom N, Zulkifli NF (2011), Critical Success factors for

Bumiputera/Muslim Medical Tourism Providers: Solution for Financing Needs Using
Islamic Financing Instruments.
 Dusuki, A. W. (2008), Practice and Prospect of Islamic Real Estate Investment Trusts
(I-REITs) in Malaysian Islamic Capital Market.
 Standard Chartered (2011), Equity Research: KPJ Healthcare Berhad
 MIDF (2012), Equity Beat: KPJ Healthcare Berhad KDN: PP10744/06/2012
 JP Morgan, 2012, KPJ Berhad Investor Relations [Online PDF]
 Available at: kpj.listedcompany.com/misc/analyst/KPJ_JPMorgan_20120116.pdf
 Standard Charted Analyst, 2012, KPJ Berhad Investor Relations [Online PDF]
 Available at: KPJ Healthcare Berhad, 2012, KPJ remains a defensive play with long
term growth prospects [Online] Available at: http://www.kpjhealth.com.my/news-
detail.php?id=434

Websites

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 http://disclosure.bursamalaysia.com/FileAccess/apbursaweb/download?
id=198188&name=EA_FR_ATTACHMENTS
 http://www.bursamalaysia.com/market/listed-companies/company-announcements/5731793
 http://www.bursamalaysia.com/market/listed-companies/company-announcements/6098685
 http://www.kpjpenang.com/news-detail.php?id=3
 http://www.kpjhealth.com.my/coffee-table-book/new/Chapter-1-new.pdf
 http://www.thestar.com.my/Business/Business-News/2013/04/30/KPJ-Healthcare-to-maintain-
dominance-in-local-market/
 http://www.thesundaily.my/news/927387

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