Information given for the Company:
In 1998, Lasik Vision Corporation was the first laser vision correction provider in North America to offer “affordable, value-pricing” and to promote it with direct-to-consumer advertising. At the time, this was a new approach for a medical services company and allowed it to capitalize on a larger mass appeal for the procedure. Dr. Wallerstein was the National Medical Director of LASIK Vision Corporation and oversaw medical standardization, and Dr. Cohen was the National Director of Professional Affairs and oversaw physician recruitment and training. By 2000, Lasik Vision Corporation, a publicly traded corporation, became the largest laser vision company in the world, as measured by procedure volume. In 2001, Cohen and Wallerstein left LASIK Vision to implement a similar medical model in a group of privately-owned facilities. These centers operate under the name LASIK MD. LASIK MD subsequently acquired the majority of the former Lasik Vision facilities in Canada. (Wikipedia)
1. What was Lasik Vision’s competitive priority?
The aim of Lasik Vision was to gain competitive advantage in the eye surgery industry by offering the lowest price on the market and making profits through economies of scale i.e. high volume of operations and reducing costs. Furthermore they executed a very aggressive advertising campaign which accounted for 10-15 percent of profit. The initial price tag of $5000 for an eye surgery was brought down to $1598 for both eyes. The main driver for this change was Henderson who believed that mass volume with low margins is the only way to make high profit in this industry. He focused on efficiency, productivity and growth in his strategies. To achieve his goals, he pushed for the reengineering of the traditional model of the refractive surgery...
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