THYROCARE:

Disrupting The Indian Medical Diagnostic Industry

Disusun untuk memenuhi tugas Mata Kuliah

Strategi Persaingan dan Simulasi Bisnis

Oleh Kelompok 5 :
Ucik Sulistiyawati - 041924353006
Adri Istambul LG - 041924353011
Puput Randradivi Ariadi - 041924353028
( Kelas E2A / Akhir Pekan 54)

MAGISTER MANAJEMEN
FAKULTAS EKONOMI DAN BISNIS
UNIVERSITAS AIRLANGGA
2021
Tugas Makalah “Thyrocare”
1. Lakukan analisa industri diagnostik di India dengan menggunakan kerangka Five
Force Competition Model yang diuraikan di buku teks!

• Bargaininng Power of Buyers/ Buyers’ Power : Pada sisi ini, akan fokus pada
analisis pembeli. Pembeli tentunya pasti akan memegang pearanan besar
dalam kegiatan jual-beli, namun di sini lebih mengarah kepada pilihan
pembeli terhadap produk yang ada, Ada kondisi dimana pembeli hanya bisa
membeli produk pada perusahaan ini (hal ini menggambarkan High Buyers’
Power), ada juga jika pembeli punya banyak pilihan untuk membeli produk
yang sama produksi perusahaan lain karena ada banyak jenis dijual di pasaran
(hal ini menggambarkan High Buyers’ Power). Customer loyalty juga
termasuk dalam dalam sisi ini. Pembeli yang sudah loyal tentu akan
sepenuhnya melakukan jual-beli hanya produk tersebut, akan menciptakan
kondisi Low Buyers’ Power
Diagnosis : . Despite a marked slowdown in the macroeconomy, Thyrocare
posted exceptional numbers; its revenues increased by 28 per cent. Its earnings
before interest, tax, depreciation, and amortization (EBITDA) and profit after
tax (PAT) margins were the highest in the industry, at 40 per cent and 22 per
cent, respectively,3 leaving industry peers far behind
• Bargaininng Power of Suppliers/Suppliers’ Power : Hampir mirip
dengan Buyers’ Power, pada sisi ini akan menganalisis pada sisi supplier.
Seberapa besar perusahaan ini membutuhkan atau ketergantungan pada
suppliernya. Ada bahan baku yang mungkin bisa dibeli dengan supplier mana
aja (hal ini menggambarkan Low Supplier’ Power). Ada juga bahan baku
yang hanya bisa dibeli oleh supplier tertentu, atau dalam konteks perusahaan
besar, tentunya sudah punya kerja sama dengan supplier tertentu dengan harga
yang berbeda dari pasaran karena produksi skala besar, jadi jika ada masalah
dengan supplier tersebut akan membuat proses produksi terhambat karena
sudah tergantung dengan supplier tersebut (hal ini menggambarkan High
Supplier’ Power).
Diagnosis : Suppliers were primarily vendors providing testing equipment and
consumables, generally known as reagents. These reagents wielded power,
meaning that the cost ofsupplies varied widely with the volume of
procurement. Staff were generally not well trained in operations, safety, and
hygiene. Nonetheless, despite such inefficiencies, the industry enjoyed
healthy margins. Imaging diagnostics contributed 44 per cent to the Indian
diagnostic industry, and the remaining 56 per cent was from pathology
diagnostics.
The consumables and reagents used in testing processes were supplied by the
testing equipment suppliers. If a lab committed to greater volumes of reagent
orders, the supplier would offer the reagents at substantially lower unit costs.
• Thread of New Entrants : Pada sisi ini akan lebih menganalisis
kepada awareness, apakah bisnis ini mudah untuk diikuti atau tidak. New
Entrants yang dimaksud adalah individu atau kelompok yang membuat bisnis
sama seperti yang yang sudah ada ini. Ada kondisi dimana sebuah bisnis baru
yang sedang booming terus bertambah di pasaran karena untuk membuat
bisnis seperti itu cukup mudah (hal ini menggambarkan High Thread of New
Entrants). Selain itu juga ada kondisi dimana sebuah bisnis hanya bisa
dilakukan oleh perusahaan-perushaan tertentu. Ada berbagai macam factor yg
ada, bisa karena resiko yang terlalu tinggi, perlunya tingkat keahlian tinggi,
dan factor-faktor lainnya (hal ini menggambarkan Low Thread of New
Entrants)
 Diagnosis : The last two decades leading up to 2017 had seen the emergence
of stand-alone local laboratories, substantially increasing competitive rivalry.
Despite new entrants, the diagnostic industry had remained highly
fragmented; there were more than 100,000 diagnostic centres in the country.9
The early 2000s also saw the emergence of private, non-hospital-based
diagnostic chains. Diagnostic chains were categorized as either regional or
pan-India, and private diagnostic chains were predominantly regional and
highly localized. Only a few players had managed to expand across the
country to gain a pan-India presence
• Threat of Substitute Product or Services : Sisi ini akan menganalisis tentang
pengganti atau substitute dari produk yang dihasilkan oleh perusahaan.
Sebuah produk maupun jasa, apakah memungkinkan untuk digantikan dengan
yang lain atau tidak. Dalam konteks ini, pengganti adalah barang atau jasa
yang berbeda tetepi dapat mengisi ketidakhadiran barang atau jasa utama yang
dibutuhkan.
Diagnosis : Large pan-India diagnostic chains adopted the hub-and-spoke
model of business operations (see Exhibit 5). Many of the large players had
more than 100 laboratories spread across the country. A large number of
collection centres were the primary catchment points for samples that were
then directed to one of the company’s laboratories for testing. Some collection
centres also had testing facilities. The components of the hub-and-spoke
model typically included a national reference laboratory, a regional reference
laboratory, satellite laboratories, and collection centres.28 Based on the
complexity of the test, a satellite laboratory, which was either owned or
franchised by the diagnostic chain, transferred samples to a regional reference
laboratory or a national reference laboratory. The national reference
laboratories, spread over an area of 2,000–3,000 square feet (180 to 280
square metres), were located centrally and typically also served as the
corporate headquarters of the diagnostic chain.
• Rivalry Among Existing Competitor : Pada sisi ini, analisis sudah diliat
pada scope yang lebih dibatasi, yaitu pesaing dalam industri atau pasar yang
sama. Salam sebuah pasar, pasti ada beberapa produk atau jasa sejenis yang
bersaing mendapatkan pelanggan. Tinggi rendahnya persaingan yang akan
dianalisis. Persaingan tentu akan tinggi jika ada banyak perusahaan dalam
 industri yang sama, tetapi ada juga perusahaan yang menguasai sebuah
industri.
Diagnosis : SRL Diagnostics was the largest pan-India chain in the country.
Dr. Lal PathLabs, the second largest player, was listed in the stock markets,36
as was Thyrocare Technologies, which was also a pan-India player. Medall
and Metropolis also operated large pan-India diagnostic operations, 37 both
of which were not yet listed on the stock markets; therefore, little operational
and financial data was available in the public domain.
2.Uraikan strategi bisnis Thyrocare selama dua dekade sebelum 2017!
a) offering such low prices for 20 years, while continuing to be the most profitable
company in the industry.
b) Thyrocare focused on the downstream business of processing samples and operated
completely through a franchise model.
Efektifkah strategi tersebut?
Yes
Berikan bukti/fakta yang tertulis di kasus!
a) Velumani founded Thyrocare in 1996 with initial capital of ₹200,000, renting small
premises of only 200 square feet (18 square metres) in Byculla, Mumbai.
b) The competitors, especially the larger pan-India chains, were becoming aggressive;
many of them were attempting to imitate the Thyrocare model. They were entering the
wellness market by building business-to consumer brands that directly connected with
patients and lowering their prices to gain market share
3. Apa sajakah capabilities yang dibangun Thyrocare yang menyebabkan keunggulan
bersaingnya?
a. Procurement of samples involved a completely different set of capabilities in
comparison to efficiently processing the samples. It was very difficult for anyone to
perform both parts of the value chain effectively and efficiently. I used the analogy of
kitchen and restaurant, in this context. Thyrocare will be and will remain the kitchen—
that is, the back-end or downstream—one big kitchen to the consumers and other
customers. It will not attempt to do the restaurant business— that is, the front-end or
upstream. I had a kitchen, I didn’t have a restaurant; it was very clear from the beginning
and there was no confusion.
b. Thyrocare believed that customers looked for transparency and accuracy in testing
results, speed, trust, convenience, and above all, an affordable price. I had strived to
 build capabilities that precisely delivered such value propositions to my customers, at
the lowest cost.
c. By choosing “preventive care” tests, my patients were vertical, walking, and were in
offices or homes, while my competitors serviced the “sick care” segment, where their
patients were horizontal, bed ridden and in hospitals; that way I had a higher “under-
penetrated” market, having repeat customers, to cover.
d. Thyrocare was among the first in the industry to promote preventive care diagnostics
on a large scale through its business-to-consumer (B2C) brand Aarogyam, which
focused on the wellness segment
e. Thyrocare’s CPL had set a precedent in the industry and continues to stand out as a
benchmark of excellence. Air cargo logistics help the samples from across the country
to reach the central laboratory, the same night, before midnight. The samples then were
turned around in the next four hours. Processing all samples under the same roof had
helped the company achieve scale economies and maximize capacity utilization with
respect to its equipment and facilities. Thyrocare’s CPL could perform all tests offered
while the RPLs were equipped to perform the tests that were more routine in nature
leaving the high value adding tests to move to the CPL. The majority of the samples
continued to be processed by the CPL. The seven labs processed 14.3 million samples
during 2017.
f. Thyrocare had remained debt-free since inception and expansions had always been
through internal funding. Given the superior working capital management, the company
made advance payments for equipment vendors securing cash discounts on
procurement. In a sense, Thyrocare became an industry aggregator for certain types of
tests, given the cost advantage that Thyrocare enjoyed; other stand-alone and small labs
in the country were compelled to outsource their volumes to Thyrocare.
g. A small team of senior managers and industry professionals, along with my children
and my brother, Mr. Sundaraju, managed the complete operations of the company.
Travel expenses were incurred only when absolutely necessary. There was always an
eye for cost and this was a defining culture within Thyrocare.
h. Tests processed through CLIA were charged double the cost of tests processed through
RIA. Thyrocare’s pricing was, however, independent of the technology used, and CLIA
usage only lowered its costs. As a result, it was able to offer a uniform lower price to
the market.
4.Akankah keunggulan bersaing Thyrocare berkelanjutan dan imun terhadap serangan
para pesaingnya?
Yes. By 2014, Thyrocare had diversified into the nuclear imaging business with PET-CT scans.
It developed a network of molecular imaging centres for cancer diagnosis through its wholly-
owned subsidiary company Nuclear Healthcare Limited, which offered scans at 40 per cent to
50 per cent lower cost than the competition.43 It had already invested in 11 PET-CT and
cyclotron machines. Its model for growth in this business was through franchises, where a
proportion of the capital-intensive investments and returns were shared among the franchise
partners. By 2017, the PET-CT machines achieved 9.1 scans per day per machine. Thyrocare’s
goal was to set up 60 PET-CT scanners and four cyclotron facilities across India by 2022, and
to achieve an average of 30 scans per day, booking an annual revenue of ₹1 billion with 60 per
cent EBITDA margins. As of 2017, Thyrocare had forayed into tuberculosis testing, and
believed it to be a sizable opportunity in the foreseeable future.44 Thyrocare had begun testing
water samples, and was operating under the brand Whaters, testing for physical, chemical,
microbiological, pesticidal, and volatile organic elements in water samples. To further its core
business, the company had also set up a chain of clinics branded as Thyrocare Metabolic
Clinics, a nationwide branded chain for individuals with chronic illnesses or who planned to
undergo a health care procedure. Thyrocare offered the SugarScan blood glucose monitor, a
self-testing kit to instantly determine the user’s blood glucose levels. It had also planned an
aggressive overseas thrust by expanding its international presence.