The present research has identified that the MMG acts as a major supplier of customers to the hospital division. The relationship of this collaboration is however not quantified. Therefore the hospital branch refuses to acknowledge the effect of this MMG. The new management under Olsen aims to create an alliance with other hospital groups in the region. This alliance can be a negative factor for the Midwestern group if not managed effectively. This is because the clinics can be easily plucked away, as has been shown in the past.
Once alliances have been formed it would become much easier for the clinics to simply move away from the Midwestern group and MMG. The availability of customer is not major issues for Midwestern in the current structure. However, if the structure is change i. e. MMG is divested or sold off then there would be a decreased flow of customers to other parts of the organization. The retail channel formulation is relevant to this discussion. The current structure of Midwestern groups forms a retail chain like system. Therefore even if the customer ends up buying the product from the Midwestern hospital, the entire chain is responsible for creating the brand that is Midwestern.
Therefore it can be said that if the MMG is no longer present the market size for Midwestern would shrink. The actual competitors are the other clinics and hospitals in the region. The integrated network of Midwestern, however, gives it an advantage over competitors. However, if the chain is broken than new competitors would start eating into the Midwestern market. Therefore the company will have to understand that the key strength lies in the integration of its different units.
This is the main reasons that previous managements have not liquidated MMG. The main weakness of Midwestern competitors is the lack of integration. The smaller units can not pose a threat until they make an integrated network. The smaller practices, however, can target different business segments. The clinics that have broken off from MMG can also be a serious concern for the business.
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