Propsects and Challenges of Integrated Electonic Health Records for Managed Care Organizations - Free Essay Example

Sample details Pages: 13 Words: 3801 Downloads: 7 Date added: 2017/09/15 Category Advertising Essay Did you like this example? PROPSECTS AND CHALLENGES OF INTEGRATED ELECTONIC HEALTH RECORDS FOR MANAGED CARE ORGANIZATIONS by Peter Oluseyi Okebukola MPH/MBA Intended audience This is a public policy memo directed to the Office of the National Coordinator of Health Information Technology (ONCHIT) within the Department of Health and Human Services (DHHS). CONTENTS ? ? ? ? ? Executive Summary Background Definitions stakeholders Options and implications for managed care ? ? ? ? ? ? ? ? ? Individual practice association (IPA) or network model HMOs Staff or group model HMOs Point of service (POS) plans Medicare/ Medicaid Medical tourism Potential Problems Possible Resolution and its Possible Effects Conclusion and Potential Areas for Further Study Recommendations Executive Summary Healthcare Information Technology (HIT) has been shown to improve organizational efficiency and has the potential to transform healthcare and the managed care industry in the near future. The potential impact of HIT on cost savings and quality improvement has led Congress to enact the American Recovery and Re-investment Act of 2009 (ARRA) which encourages the use of information technology to achieve fully integrated electronic health records system in the United States. Don’t waste time! Our writers will create an original "Propsects and Challenges of Integrated Electonic Health Records for Managed Care Organizations" essay for you Create order This law has a lot of implications for the managed care industry which is responsible for the healthcare of a large percentage of Americans. There are many models of managed care and there are also many models of Electronic Health Records (EHRs) which suit each of these different models. However, what is good for one model of HMO may not be good for the other and I hypothesize that this may create many independent, self-sufficient health information systems that may not allow the over-arching goal of the ARRA Act of interconnectivity and interoperability to be met. I propose that a generic model of health information system be developed by the ONCHIT which would have as its backbone, the Centre for Medicare and Medicaid (CMS). This system will be anchored around the Medicare and Medicaid programs and the managed care organizations would design their own systems in such a way as to be interconnected with this system, as opposed to having their own standalone systems. There are many teething problems within this developing area and my roposition may cause some more, but if the ONCHIT ensures that the innovative MCOs who have already installed their own systems are not penalized but encouraged and the spirit of competition is not dampened among vendors, the expected benefits of EHRs may soon be reaped by all, especially the enrollees of the various managed care organizations in the United States. Background Despite the widespread use of information technology in many industries in the general US economy, the health sector in general and managed ca re organizations in particular have yet to put its potential power to good use. The benefits of the value of information technology and its potential for cost saving and improved quality and reduced costs in the long run are well documented (Hillestad 2005, Chen 2009). Despite this however, about 17% of U. S doctor‘s offices and 10% of hospitals have only basic electronic health records, which are by no means integrated and interoperable (Blumenthal 2009). These conditions necessitate that the manner of recording patients‘ clinical information in most care settings is in paper form, which means that the process of reimbursement and payment of claims by managed care organizations is in paper format without any way of truly monitoring care across the different variants of the managed care organization systems. This has many implications for quality control and measurement in the managed care settings of both public and private payment systems including Medicare and Medicaid (Hudson-Scholle 2010). In a bid to remedy the situation, the US government enacted the American Recovery and Re-investment Act of 2009 (ARRA) which contains legislation on the use of information technology to achieve a universal inter-operable and fully integrated electronic health records system in the United States. This legislation, called HITECH, provides up to $30 billion in financial incentives intended to get doctors and hospitals to adopt and use EHRs all contingent on demonstrating the ? meaningful use‘. (Blumenthal 2009,Weiner 2010b). This legislation has many laudable objectives and in the context of managed care, it would be appropriate to discuss the various definitions and implications for the heterogeneous managed care industry and more importantly, the patients, who are the beneficiaries of all these efforts. Definitions There is a need to define the taxonomy to be used in this paper. This has been culled from the lectures by Professor Jonathan Weiner. Health information technology (HIT) thus refers to the ? application of electronic health records (EHR) and other digital technologies to the delivery and management of health care? nd is sometimes used interchangeably with the term ? e-health‘ which refers to ? health and healthcare practices supported by electronic processes and communication? , while health informatics (HI) refers to ? the systematic application of information and computer sciences and technology to health care practice, research and learning? (Weiner 2010b) Managed care is defined as an integrated system that manages health services for an enrolled population rather than simply paying or providing for them (Weiner 2010a). This definition incorporates the fact that managed care organizations need to monitor the health of their enrollees and there is no better way to do so than with the use of health information technology. Stakeholders There are many stakeholders in this drive to achieve interoperable electronic health records systems. The most important stakeholders are the managed care organizations and their enrollee base, doctors and hospitals. However, there are a few more important players in this emerging sector. When the ARRA Act was passed, it mandated the creation of the Office of the National Coordinator of Health Information Technology (ONCHIT) within the Department of Health and Human Services (DHHS). ?ONCHIT currently exists under executive authority, but the HITECH provision enshrines it in statute and greatly expands its resources. One responsibility of the ONCHIT will be to create a strategic plan for a nationwide interoperable health information system, a plan that must be updated annually. Two statutory committees will advise the coordinator: a Health Information Policy Committee and a Health Information Standards Committee? (Blumenthal 2009). The purpose of this office is to guide the deployment of Information Technology to make sure that they meet standards and the unique demands of the healthcare system and in particular, the managed care organizations, which are responsible for financing a large proportion of healthcare in the United States. While there were industry appointed watch dogs that served as a self-regulatory body, such as Health Level Seven International (HL7), the ONCHIT would now play a wider role which would be more than the HL7‘s of developing standards and providing a comprehensive framework for the exchange, integration, sharing, and retrieval of electronic health information that supports clinical practice and the management of health services (HL7, 2010). The practical implications of this become apparent when we note that of the 85% of insured Americans, the financing mechanisms which include public (Medicare and Medicaid) and private, managed care organizations are responsible for the care of most insured Americans. The various roles which health information technology can play in the various managed care systems are discussed below. Options and Implications for Managed Care The characteristics of managed care make it an ideal candidate for the implementation and use of EHRs. The functions of managed care are to organize the tripod of care management or disease management, coordination of providers and financial monitoring or regulation (Weiner 2101a). These functions can be carried out more effectively by the use of information technology as the case of the Kaiser Permanente HMO (Chen 2009) and the Johns Hopkins Healthcare LLC (Dunbar 2010) has shown. Traditional health insurance models can be roughly divided into the traditional fee-for-service indemnity model, ? managed care? indemnity plan, preferred provider organizations (PPO) which make up about 45% of insured Americans, and the health maintenance organization (HMO) which covers about 35% of insured Americans (Weiner 2010a). The HMOs are often referred to as point of service or POS plans. I would like to posit that the role of health information technology in these different organizations varies and that even though it might be tempting to have different frameworks of health information technology or each of these plans, a generic, interoperable system would be the best, given the peculiarities of the American system. The effects on individual practice association or network model HMOs: These are health insurance plans that contract with existing groups and solo private practitioners to care for patients either on capitated or risk-sharing FFS basis (Weiner 2010a) They are u sually disjointed and with the diversity in practice and sheer number of vendors, it may be indeed difficult for the same electronic health system to be shared by all. This complexity however makes the system more inefficient as connectivity between all the individual practices in the network may be costly and in an event where people are trying to implement it, the difficulty involved may make the stakeholders feel that it is not worth it. However in the Johns Hopkins Healthcare LLC, the health information systems have improved productivity and contributed to the bottom line giving hope that these can indeed be replicated throughout the country with patience, creativity and ability to factor in the concerns of all stakeholders (Dunbar 2010). The effect on the staff or group model HMOs: this model involves physicians hired either directly by the HMO or by a separate physician group formed exclusively to serve that HMO‘s patients. This is the model of the Kaiser Permanente and health information systems have been successfully installed and have proved very efficient as discussed by Chen et al (2009). However, from a macro-economic stand-point, these stand-alone information systems for various group model HMOs may not fully help meet the goals set by congress that promulgated the ARRA Act. This is because for the administrators of these systems, the architecture is established in such a way as to encourage interconnectivity within the network and the more the system can be kept free from external influences, the better. This naturally discourages the openness and interconnectivity that the proponents of the ARRA act envisioned. The question is that will interconnectivity breed lack of innovation and stifle competition? This question is answered by David Blumenthal who posits that with a well regulated environment, interconnectivity can be assured while maintaining the standards of interoperability required by all forms of health information systems, regardless of the model of HMO or managed care. This means that the standards that are set have to be fair and not punish the innovative ones who have begun to implement the system before others or those who push the frontiers of innovation in specific features of the various systems. Use to point of service (POS) plans: this is a type of plan where the enrollee can decide at the ? point of service? whether they want to stay within the HMO network or get service covered at less generous levels from providers ? outside? the network (Weiner 2010a). The modalities for health information technology are slightly different for this type of model. This is because the onus is on the consumer to choose where he/she would rather have care. The implications are that the type of electronic health system implemented would be different from that used in the network model HMO. This type of EHR would be heavily dependent on the personal health record (PHR) which would have to be taken to the new provider or made available to the doctor via the internet. It puts the power in the hands of the consumer to make use of the personal health records which will be developed to improve its functionality and act as a ? mobile? or virtual health record, which can be called up by any physician the patient decides to see at that particular time. The care given would be documented and the patient has it on record so that the doctor who treats her next would see the interventions done and then follow up. Also, it makes billings and financial management easier on the part of the administrators of the HMO for monitoring of reimbursement of funds to be providers in different locations. Effect on Medicare/ Medicaid: these large programs potentially have the most to gain from the establishment of interoperable health information systems as they have a large number of enrollees and are federal in nature. These programs would benefit from a central modulated system so as to ensure the ease of use across the different states and multiple stakeholders. When these systems are interoperable, it makes it easier to avoid costs of interconnectivity. However, because they have an increasingly larger part made up of managed care, it is important that the office of the ONCHIT ensures that stand-alone systems are discouraged and that most of these systems are interoperable with the electronic health systems used by the CMS. This is important as the system used by Medicare and Medicaid for administrative and clinical monitoring covers so many patients and it is necessary for the various HMOs that have roles in the various programs e. . Part D and Medicare Advantage programs to be able to connect seamlessly to the system used by Medicare and Medicaid to avoid unnecessary delays and inefficiency. Effect on â€Å"medical tourism†: The advent of tele-medicine which got its start in remote settings with few providers has led to a possible change in the way managed care organizations can organize care. Indeed the cost of healthcare can be m arkedly reduced with the ability of doctors to offer advice even thought they are not physically present. They can review the patient‘s status online and communicate with the patients virtually. According to Weiner, this is likely to lead to a type of ? digital medical tourism‘ or more correctly, ? tele-health without borders? (Weiner 2010b). Potential Problems Despite government‘s interest and sector-wide initiatives, not so much progress has been made. There have been many teething problems associated with HITECH including a policy and political stalemate in which players could not agree on particular standards and procedures (Diamond 2008). On the demand side, many barriers still exist, including high costs, lack of certification and standardization, concerns about privacy, and a disconnect between who pays for EMR systems and who profits from them (Hillestad 2005). Other concerns include the perceived lack of financial returns from investing in them, the technical and logistic challenges involved in installing, maintaining, and updating them, and consumers‘ and physicians‘ concerns (Blumenthal 2009). For managed care organizations that have already put in place their own custom-built systems, there might be inertia to remodel their systems in such a way as to ensure interoperability. The onus is however on Medicare and Medicaid through the CMS, to demonstrate the use of EHRs for their patients and most managed care organizations will follow suit, making systems that are interoperable the CMS as the standard or focal point. Other challenges nclude the ethics of the EHRs which patient safety and confidentiality (Diamond 2008), sales of vital information using the principles of ethics of managed care: beneficence, non-maleficence, respect for autonomy, justice. These tenets apply to the implementation of EHRs too (Taylor 2010). Possible Resolution and its Possible Effects Even though health absorbs more than $1. 7 trillion per year,—twice the Organization for Economic Cooperation and Development (OECD) average—premature mortality in the United States is much higher tha n OECD averages (Hillestad 2005). This underscores the need for the rapid initiation of electronic health records, if the tide of increasing costs is to be stemmed. This is however not limited to the United States as large scale initiatives put in place by the World Bank and WHO have also tried to stimulate the implementation of HER on a global scale (Fraser 2005, Mars 2010). There is reason for optimism as organizations who have implemented fully functional electronic health records system have success stories. An example is the Kaiser HMO which has seen marked improvement in operational efficiency and has seen costs reduce markedly (Chen 2009). The government‘s action promises to improve the efficiency of managed care organizations. While it is obvious that clinical practice will no longer be limited to paper-based records that will be limited to the facility, the emergence of EHR will encourage resource sharing and will be a veritable tool for comparing health plans, HMOs, hospitals and physicians when it comes to issues of quality measurement, as advocated by the National Committee for Quality Assurance, NCQA (Hudson-Scholle 2010). On the part of the Office of the National Coordinator of Health Information Technology (ONCHIT) within the Department of Health and Human Services (DHHS), it is saddled with the responsibility to monitor the fledgling industry and ensure a standard playing field for all stakeholders. According to Jha et al, this is easier said than done as this move may further deepen the inequity in the system. They posit that ? as the nation moves toward greater use of EHRs, it is important to determine whether or not there are aps in adoption rates between hospitals that disproportionately care for the poor and those that do not. There seem to be modest differences in quality of care between hospitals that disproportionately care for the poor and those that do not? (Jha 2009). These concerns are real and need to be addressed. Also, the ONCHIT has realized that the incentives have to be structured in such a way as to ensure that providers benefit from improving the quality and efficiency of the ser vices they provide. Only then will they be motivated to take full advantage of the power of EHRs (Blumenthal 2009). The real winners may be the technology companies who stand to gain a lot from the expansion of their business and the relatively untapped market. It is however important not to fall into the trap identified by Diamond, who identified the problem of over-regulation and setting unachievable standards. They identified another approach which should ? focus on a minimal set of standards at first and would make utility for the user to improve health outcomes, rather than agreement of the vendor on the key criteria. Finally, it would require clear policy statements that will guide the design of technology. All of these issues are inextricably connected, and they should be pursued together?. This is important if the government is not to stifle creativity (Diamond 2009). Above all, the customers and not managed care organizations alone are to be the beneficiaries as they should be assured that their information will not be used for any other purposes they have not consented to. Steinbrook muses that because legal protections have not kept pace with technological advances, Congress may wish to amend HIPAA or enact new legislation to safeguard personally controlled electronic health data. If concerns about privacy, security, and commercial exploitation can be allayed, this nascent enterprise should have a smoother birth. (Steinbrook 2010). Conclusion and potential areas for further study There are many areas that need further studies as highlighted by the Congressional Budget Office (CBO) report which the highlighted the dearth of adequate data on the benefits of health information technology for providers and hospitals that are not part of integrated systems which include the individual practice associations (IPA) and point of service plans (POS) (Orszag 2008). A thorough study of this area will bring to the fore, concerns of stand-alone hospitals and providers and the potential benefits of interoperability. Recommendations I have posited that indeed Electronic Health Records are necessary for the improvement in managed care in the US and the government has set up many initiatives and policies to ensure that this is fast-tracked including setting up of financial incentives for hospitals and doctors to implement EHR. However, there are various types of EHRs which are applicable to the various HMO or managed care models and there is a risk of creating many fully functional and totally interoperable systems. I suggest that the office of the ONCHIT should, with wide consultation, encourage managed care organizations and care givers to have a basic template for the architecture of their systems and have as the focal point, the Centre for Medicare and Medicaid, which should develop its own system that can be inter-connected to the various variants used by the various HMOs. While the ONCHIT has a lot to do in this regard, the obstacle to overcome are significant, but can only be overcome by continuous deliberation and dialogue among all the stakeholders. Indeed it may be a laudable endeavor, but it is not yet ? uhuru‘ as there are many obstacles on the path to the promised land of fully functional, inter-connected and inter-operable, user friendly electronic health records which are used nationwide and are used as a template for quality improvement performance measures for managed care organizations. References Blumenthal, D. Stimulating the Adoption of Health Information Technology. New England Journal of Medicine Volume 360, Number 15. April 9, 2009 Chen, C. , Garrido T. , Chock, D. , Okawa, G. , Liang L. The Kaiser Permanente Electronic Health Record: Transforming and Streamlining Modalities of Care. Health Affairs Volume 28, Number 2323, 2009. DOI 10. 1377/hlthaff. 28. 2. 323 Diamond, C. , Shirky, C. Health Information Technology: A Few Years of Magical Thinking? Health Affairs 27, no. 5 (2008): w383–w390 (published online 19 August 2008;10. 1377/hlthaff. 27. 5. w383)] Dunbar L. Care Management in Network Plans; Lecture given on February 2nd, 2010 in Johns Hopkins School of Public Health Managed Care and Health Insurance class. Fonkych K. , Taylor R. , The State and Pattern of Health Information Technology Adoption SantaMonica, Calif. : RAND, 2005). Fraser H. , Biondich P, Moodley D. Implementing Electronic Medical Record Systems In Developing Countries. Informatics in Primary Care 2005; Volume 13: 83–95 Hillestad, R. , Bigelow J. , Bower, A. , Girosi, F. , Meili R. , Scoville R. , Taylor R. Can Electronic Medical Record Systems Transform HealthCare? Potential Health Benefits, Savings, and Costs. Health Affairs Volume 24, Number 51103, 2005. DOI 10. 1377/hlthaff. 24. 5. 1103 HL7, 2009. Health Level 7, Retrieved fromhttps://www. hl7. org/about/index. cfm HL7 on February 20, 2010 Hudson-Scholle S. Measuring Quality, Driving Value. Text of lecture delivered in Managed Care and Health Insurance Class, Johns Hopkins Bloomberg School of Public Health, February 22 2010. Jha A. , DesRoches C. , Shields A. , Miralles P. , Zheng J. , Rosenbaum S. , Campbell E. Evidence Of An Emerging Digital Divide Among Hospitals That Care For The Poor. Health Affairs Volume 28 No 6, 2009 DOI 10. 1377/hlthaff. 28. 6. w1160 Mars M. , Scott, R. Global E-Health Policy: A Work In Progress. Health Affairs Volume 29 Number 2, 2010: 239-245. DOI 10. 1377/hlthaff. 2009. 0945 Orszag, R. Congressional Budget Office, ? Evidence on the Costs and Benefits of Health Information Technology,? Testimony before the House on Ways and Means Subcommittee on Health, 24 July 2008. https://www. cbo. gov/ftpdocs/95xx/doc9572/07-24-HealthIT. pdf (Retrieved on February 20 2010). Steinbrook, R. Personally Controlled Online Health Data —The Next Big Thing in Medical Care? New England Journal of Medicine; Volume 358 Number 16. Retrieved from www. nejm. org. on February 19, 2010. Taylor H. , Introduction to Ethical Issues in Managed Care. Lecture given on March 8th, 2010 in Johns Hopkins School of Public Health Managed Care and Health Insurance class. Weiner J. , The Developing Health IT/ Electronic Health Record (EHR) Infrastructure: Implications for Population-based Managed Care. Lecture given on March 3rd, 2010 in Johns Hopkins School of Public Health Managed Care and Health Insurance class.

Machiavelli As A Renaissance Man - 2969 Words

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Journal Advanced Manufacturing Technology -Myassignmenthelp.Com

Question: Discuss About The Journal Advanced Manufacturing Technology? Answer: Introduction Woolworths Limited is a major Australian organization with broad retail enthusiasm all through Australia and New Zealand. It is the second largest organization in Australia by income, after Perth based retail-engaged combination Wesfarmers Ltd. Furthermore, Woolworths Limited is the biggest takeaway alcohol retailer in Australia. Woolworths Limited was established in September 1924, initially under the name "Woolworths Bazaar Ltd.", a play on the globally famous F. W. Woolworth name. In the wake of finding the name had not been enlisted in Australia, and Woolworths had no plans for abroad extension, the organization progressed toward becoming "Woolworths Limited" on 22 September 1924. Following the organization's first "Bargain Basement" opening in the Imperial Arcade, on Sydney's Pitt Street, there was little enthusiasm for investors to quicken the brand's development. Be that as it may, as exchanging proceeded and investors brought more capital, the profits paid by the organization expanded from 5% to half after its third year of operation(Woolworthsgroup.com.au, 2017). Woolworths has ended year 2016 with $1.6 million loss, however in 2017, the organisation has shown a rapid development with $2.6 million profit before interest and tax(see Appendix A). With its 992 stores operating currently, Woolworths Supermarkets serve over 29 million customers across their brands every week, with more than 200,000 team members employed(Woolworthsgroup.com.au, 2017) Operations and Logistics Analysis Inventory Management at Woolworths supermarkets is currently achieved through an online system which is complemented by Radio Frequency Identification (RFID) guns to monitor stock counts and ensure the correct load is received and ordered. The inventory system automatically orders the load after approval by the duty manager based on sales and inventory data from previous day (see appendix C Load Forecasting) . Incorrect inventory data results in the incorrect load being ordered. This then leads to excess stock which is a contributor to holdings costs and order costs. The core problem in this system is the room for error which is determined by multiple factors. The grocery load among with other items such as seafood and meat is delivered to the store everyday. Each time a load is delivered a member of staff must receive the load which is done by entering the load serial number into an RFID gun and submitting this into the system. The load is then recognised by the system and the items received will be added to stock counts. After these items are filled by staff the left-overs or overs are tagged by the RFID gun and put into Long Term Overs (LTO). These items are then filled the next day whilst staff utilise the RFID guns by modifying the counts and changing stock locations. The current system harbours too much room for error (see appendix B Load Data).One element of the internal system affects another meaning the system as a whole is interdependent on its sub elements (Senge,1990) The issues in the inventory system include: Incorrect stock counts which lead to incorrect items in the next load. Stock location not synonymous with RFID location. This means either the previous load was not received correctly or the item was scanned into the wrong cage. This results again in the next load being incorrect. RFID count of Stock on Hand (SOH) not the same as actual stock on hand. Gap Scan: refers to scanning the gaps on the shelves where stock has been completely bought. The gap scan is performed every day to ensure the inventory system orders correct items; Gap scan completed incorrectly leads to minimal or excess stock, stock out or inventory block. Large quantity order- An example would be an individual buys 10 cans of dog food with multiple flavours, to save time the cashier only scans one can ten times. The result being the count is now wrong meaning the next load will then be wrong. Cost Benefit Analysis Solution/ Cost Benefit ABC Classification software system update Products further categorised by priority to account for demand Weekly Periodic system checks Common periodic inventory counts will contribute to the minimisation of incorrect stock Working closer with supply chain Reduced lead time for items in transit. Reduced chance of stock out. Increased logistical awareness. RFID holds information on product popularity, shelf life and product arrival date. Staff gain deeper product knowledge which contributes to customer satisfaction. Proper utilization of the LTO system Using weekly periodic counts along with ABC classification system will reduce LTO item count Specialised managerial and staff training on RFID Managers and staff have in depth RFID knowledge which will then minimise human error. Competitive Rivalry Within the Australian grocery industry there are various organisations such as Woolworths, Coles, IGA and Aldi who strive and compete within the intense industry to limit the amount of market share that other supermarkets acquire (Majumder, 2012). The intense rivalry that these competitors produce within the market force Woolworths to continually shape their strategy and value proposition to become more efficient and effective as an organization, by differentiating themselves from their competition, Woolworths will continue to develop as an organization to improve into the future (24sevenwritters, 2013). The Australian supermarket industry is currently controlled by Woolworths and Coles who remain the two dominant retailers holding a combined market share of 71%. Power of Suppliers The power that the suppliers of Woolworths have is seen as low, due to the fact that there is a large amount of products within Australia and New Zealand market who wish to enter the industry by gaining exposure and increasing their sales through a partnership with Woolworths. Therefore the dependence that Woolworths have over majority of their suppliers and their prices are low as there are a large amount of alternatives that could replace a greedy supplier to be apart of the largest supermarket in Australia (24sevenwritters, 2013). Power of Buyers Alternatively, the buyer power that the customers have over Woolworths is seen as extremely high due to the fact that Woolworths strives to give their consumers the best possible price to maintain their market share. Furthermore, if Woolworths decide to raise their prices they will lose customers to competitor supermarkets, which is the worst-case scenario. Therefore, Woolworths strive to keep the customers happy with the best possible prices to gain the most market share and sales within the industry (Majumder, 2012). Threat of Substitution Within the supermarket industry there are various alternatives for consumers to purchase their products. These include convenience stores, non supermarket affiliated petrol stations, pharmacies, fresh food markets and other competitor supermarket chains. Customers are willing to pay higher prices for the same products found in supermarkets, if it is seen as more convenient. This means convenience stores within a close vicinity that has no lines and easier parking. Therefore, the amount of substitutes in the supermarket industry is seen and moderately high as there is opportunity for some profit even though there is not a lot of market share to maintain (Majumder, 2012). Threat of new Entrants The Australian supermarket industry is seen as an unattractive market to enter. This is due to the low prices offered in australian retail stores that seem to produce a low potential profit. With the market dominated by two main organisations the threat of new entrants is seen as low with various barriers of entry, which act as obstacles for new competitors who wish to enter the industry. Recommendations The main issue that has been addressed with Woolworths inventory system is the room for error across a multitude of areas, with each element having an impact on the next. The introduction of automated identification (Auto-ID) technology such as RFID has enabled electronic labelling and wireless identification of objects, which facilitates real-time product visibility and data. However, it also presents many challenges due to lack of standards and roadmaps to transform Auto-ID technologies into Auto-ID solutions (Mills-Harris et al. 2006). The following solutions can set the standard for Woolworths inventory system and improve its accuracy, to be able to serve their customers better and save money. Solution 1: RFID Count of Stock of Hand (SOH) Woolworths sell a large range of different consumer products in all of their supermarkets, with some of them having shorter shelf lives than others. Therefore, higher tracking is needed for these types of inventory to ensure the SOH is at the right level every time to meet demand, while also avoiding the stock expiring on the shelves. Implementing the ABC classification system allows inventory to be categorised according to a measure of importance, to allocate control efforts from most important to least important (Stevenson 2017). Categorising items such as meat and milk as high priority Category A items is necessary, as these items have a short shelf life and need to be closely monitored to meet demand, while still moving quick enough that the product does not expire before it is purchased, which becomes another cost factor (Mills-Harris et al. 2006). Ordering priority items in smaller, more frequent quantities (with lead time factored) will reduce the holding costs of the inventor y in the supermarkets, however it will increase ordering costs as the number of orders needed to satisfy customer demand will increase. On the other hand, reducing the level of stock on hand will reduce the chance of product expiring and ensure the product is fresh and new. The ABC classification system can also be used to classify items based on demand, as well as seasonal periods. Including this information in the inventory system can go a long way to help inventory managers decide on when to order products and how much to order each time. Solution 2: Physical Stock Count Woolworths utilise both a periodic system and perpetual inventory system for inventory counting. The perpetual inventory system gives inventory managers a fairly accurate idea of stock levels for products in real time, where they will make orders once the stock levels have dropped to a predetermined minimum level (Stevenson 2017). To make sure this system is as accurate as possible, the periodic system needs to be performed more frequently to identify discrepancies quicker and reduce how many occur. Frequency of inventory review has been found to negatively correlate with inventory record inaccuracy, as discrepancies are easier to spot when inventory reorders are being placed, or when inventory is being physically replenished (Barratt et al. 2010). Doing a physical count of stock more often will help keep stock levels in the perpetual inventory system in check, which will contribute to the correct ordering sizes and will save Woolworths a lot of money in holding and ordering costs. Solution 3: Large Quantity Order Another way to keep stock levels in check is to properly train inventory managers and staff using RFID guns in the supermarkets. For example, staff scanning purchases at the checkout could be entering multiple quantities of one type of flavour of a product, when the customer has a few different flavours. This then throws out the stock levels of each flavoured product, as each flavour has either been entered too much or not entered at all. Correctly training staff with RFID in the beginning and then frequently reminding them of the importance of correct entry of sales is important. These reminders can be exercised with posters at register stations, trolley challenges and discussed at monthly staff meetings and stock takes. Highlighting the importance of keeping stock levels accurate to staff will go a long way to help maintain accurate stock levels in the perpetual inventory system that Woolworths have in place. Conclusion A strategic analysis shows that Woolworth growth is supported by its commitment towards its customers, leading to expansion of its operation. The internal environment has impacted the potential growth of Woolworth by the adaption of strategies such as fair price policy strategy and continuous innovation strategy and it should also adapt a strategy of training skilled employees. Australian industries face external environment conditions such as changing social patterns; political conditions i.e. government influence, technology and adverse economic conditions which affect Woolworth Limited negatively. With respect to market mix, quality of retail industry is a key factor and Woolworth promotes its brand on quality basis References 24sevenwriters (2013). Strategic Management analysis of Woolworth Supermarket. [online] 24SevenWriters. Available at: https://lastfreelance.wordpress.com/2013/11/23/strategic- management-analysis-of-woolworth-supermarketupd/, viewed on 3 October 2017. Barratt, M, Rabinovich, E Annibal, C 2010, Inventory accuracy: Essential, but often overlooked, Supply Chain Management Review, 14(2), 36. Majumder, N. (2012). Woolworths Ltd - A Case Study Report | Strategic Management | Retail. [online] Scribd. Available at: https://www.scribd.com/doc/99563233/Woolworths-Ltd-A-Case-Study-Report viewed on 1 October. 2017. Mills-Harris, M, Soylemezoglu, A Saygin, C 2006, Adaptive inventory management using RFID data, The International Journal of Advanced Manufacturing Technology, 32(9-10), pp.1052-1052. Senge, P. M. (1990). The fifth discipline: The art practice of the learning organization. New York: Doubleday Business. Stevenson, WJ 2017, Operations management, 12th edn McGraw Hill Irwin, New York. com.au. (2017). About Us - Woolworths Group. [online] Available at: https://www.woolworthsgroup.com.au/page/about-us [Accessed 2 Oct. 2017]. com.au. (2017). The Woolworths Story - Woolworths Group. [online] Available at: https://www.woolworthsgroup.com.au/page/about-us/The_Woolworths_Story/How_We_Were_Founded/ [Accessed 2 Oct.

Commercial Law Law Reform Commission

Question: Describe about the Commercial Law for Law Reform Commission. Answer: Issue The issue here is whether Rebecca sues Michelle in negligence for her losses. Rules Negligence refers to the act done by a person in careless manner due to which physical, psychological or financial loss or injury is caused to another person or group of persons (Legal Services Commission, 2013). The suffered person might sue the person who caused such damage to compensate for the loss or injury incurred to him (Lawstuff, 2015). Civil Liability Act 1936 is applicable in South Australia, which is utilized in assessment of negligent act done by any person and the liability imposed on him for such an act. The sufferer seeks financial compensation for loss or damage(Legal Services Commission , 2013). In order to determine whether negligence has occurred or not, four demands must be satisfied i.e. if the defendant owes a duty of care or responsibility towards plaintiff, if that duty of care has been breached by the defendant, if any kind of injury or damage has been caused to the plaintiff, and finally, if the reason of injury or damage has been the consequence of breach of the duty of care and responsibility. To prove negligence on the part of defendant, all these factors are required to be satisfied and if even one of the above mentioned demands is not fulfilled, the establishment of negligence is impossible (Australian Law Reform Commission, 2016). To determine whether a person owes a duty of care towards other, the existence of a sufficient proximity of relationship is must. It is a legal obligation to prevent a person from causing harm to others and then also caused, when harm is rationally predictable and due care is not taken (RMIT University, 2004). The court determines the breach of duty of care by seeking at the standard of care to be predictable in the existing conditions. It is considered by the court that what course of action would have been done by a reasonable person in the similar situation and if the act done by the defendant has been found to be unreasonable from the standard predicted, he will be proved guilty of breach of due duty of care(Legal Aid , 2015). To determine the relation of breach of duty of care and injury, it is to be assessed if there are more than one causes of injury. Contributory negligence occurs in case where the cause of injury is found to have been the contribution of the injured person themselves(Trindade et al., 2007). Plaintiff will be considered as contributory negligent if he/she has failed to take due care for self-safety or loss incurred (International Law Office, 2001). Application Rebecca and Michelle were drunk when they left the opera after the performance. Even if Rebecca has realized the fact that Michelle was too drunk to drive, she did not refuse to sit in the car and not even suggested her not to drive the car in that condition. When they were on their way to home, knowing Michele was driving dangerously, she asked her twice to get out of the car but Michelle refused. As a consequence, Michelle continued the driving and crashed the car. Rebecca got seriously injured and her leg got broken. There is a clear Negligence on the part of Michelle. As Michelle drove the car in a careless manner as a consequence of which, Rebecca suffered from serious physical injuries. She got her leg broken. The assessment of negligent act done by Michelle can be proved under the Civil Liability Act of South Australia and Rebecca is eligible to sue Michelle for compensation for the loss or injury incurred to him. The four factors which are required to be satisfied to prove the negligence on the part of Michelle are as follows; Michelle and Rebecca are friends which show there is a sufficient relationship between the two to owe a duty of care towards each other. In this case, it was the legal obligation of Michelle and Rebecca to owe a duty of care towards each other. Neither Rebecca advised Michelle not to drive harshly even if she realized that she was very much drunk to drive the car, nor did Michelle though once not to drive as it might cause harm to both of them. Michelle and Rebecca are equally liable for the harm occurred as the harm was reasonably foreseeable and none of them took due care and responsibility. The breach of duty of care is clearly visible on the part of Michelle as, any reasonable person would not drive a car in a drunken state and put his/her life as well as others life in danger. However, duty of care has been breached on behalf of Rebecca also as, she should have stopped Michelle from driving the car in drunken condition. Contributory negligence shall be applicable on Rebecca as she was conscious enough not to accept the ride when Michelle was driving the car in a drunken state. She has failed to take due care for her own safety due to which she suffered serious injury. The fact is that Michelle and Rebecca are friends and equally owes duty of care towards each other, breached the duty of care, and the consequences are the serious injuries to Rebecca. The court would hold both of them equally liable for the incident. Conclusion Rebecca should not sue Michelle in negligence because she herself is equally responsible for the accident happened. Firstly, Michelle should not have driven car in drunken state and secondly, if she was ready to drive, it was the legal responsibility of Rebecca to stop her from driving the car. If then, she failed to do accordingly, she should have denied the ride to home with her for her own safety but she accepted the ride. The fault of Michelle is that she must have thought about the consequences of driving in a drunken state but she acted negligently and crashed the car and injured her friend too. Of course, her fault is bigger than the fault of Rebecca but the accident might have avoided by the reasonable act of Rebecca. Therefore, she is equally liable. Therefore, Rebecca should not sue Michelle for negligence. References Australian Law Reform Commission, 2016. 16. Authorising what would otherwise be a Tort. [Online] Available at: https://www.alrc.gov.au/publications/right-sue-tort [Accessed 9 September 2016]. International Law Office, 2001. Contributory Negligence no Longer a Winning Defence. [Online] Available at: https://www.internationallawoffice.com/Newsletters/Litigation/Australia/Clayton-Utz/Contributory-Negligence-no-Longer-a-Winning-Defence [Accessed 9 September 2016]. Lawstuff, 2015. Being Sued. [Online] Available at: https://www.lawstuff.org.au/sa_law/topics/being-sued [Accessed 9 September 2016]. Legal Aid , 2015. Negligence. [Online] Available at: https://www.legalaid.wa.gov.au/InformationAboutTheLaw/BirthLifeandDeath/Personalinjury/Pages/Negligence.aspx [Accessed 9 September 2016]. Legal Services Commission , 2013. Negligence. [Online] Available at: https://www.lawhandbook.sa.gov.au/ch01s05.php [Accessed September 2016]. Legal Services Commission, 2013. What is negligence? [Online] Available at: https://www.lawhandbook.sa.gov.au/ch29s05s01.php [Accessed 10 September 2016]. RMIT University, 2004. Explanation of negligence concept map. [Online] Available at: https://www.dlsweb.rmit.edu.au/lsu/content/d_bus/law/business_negligence/concept/explanation.html [Accessed 10 September 2016]. Trindade, F.A., Cane, P. Lunney, M., 2007. The Law of Torts in Australia. Oxford University Press.