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Private  Sector  Promotion  (SMEDSEP)  Program    

Review  of  Cebu’s  Health  and  Wellness  Sector’s  Value  Chain                                Rene  Y.  Paquibut  www.smedsep.ph  November  2011      

About  the  PSP  (SMEDSEP)  Program  Comprising  over  99%  of  business  establishments,  micro  small  and  medium-­‐sized  enterprises  (MSMEs)  play  an   important   role   in   the   economy   of   the   Philippines.  MSME   potential   for   creating   jobs   is   large,   yet   its  growth   is  hampered  by  a  weak  business  and   investment  climate  (BIC)—the  multitude  of  regulations  and  policies   they  must   comply  with;   a   lack   of   venue   for  MSMEs   to   push   for   changes   in   government   service  delivery;   lack   of   access   to   finance   and   competent   business   development   services.   As   such,   the  Private  Sector   Promotion   (SMEDSEP)   Program*,   a   technical   cooperation   project   between   the   Republic   of   the  Philippines   and   the   Federal  Republic   of  Germany,  was   conceived   to  help   improve   the  Philippine  BIC   for  MSMEs.  

 *also referred to as the Small and Medium Enterprise Development for Sustainable Employment Program (SMEDSEP)

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 Contents

Page

Preface 3 Executive Summary 4 1 Introduction 5 2 Workshops Results and Discussion 5

2.1 The Industry’s Vision 5 2.2 Strategic Objective 6 2.3 Value Chain Opportunities, Constraints and Needs 6 2.4 Upgrading Solutions 6 2.5 Next Steps 8

3 Conclusion 8 List of Participants 9 Pictures 10                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

                                                                         

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Preface

The Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), in partnership with the Department of Trade and Industry (DTI), is implementing Private Sector Promotion (SMEDSEP) Program.

PSP SMEDSEP’s overall objective for the third phase is, "The framework conditions for private sector development in the Philippines, especially in the Visayas, are improved". This objective is to be attained by means of three components, namely, 1) formulation of MSME development strategies to improve competitiveness of the micro, small and medium enterprises, 2) enhancing competitiveness of localities; and 3) enhancing competitiveness of sectors

Component 3 of the SMEDSEP Program introduced the Value Chain approach to help sectors analyze their strengths which can be enhanced to be able to improve their competitiveness and expand their markets. In 2008, the Value Chain approach was adopted by the Cebu Health & Wellness sector to analyze their strengths and constraints and formulate strategies which can help improve their competitiveness. One of the strategies implemented was the organization of the Cebu Health & Wellness Council which served as the steering body managing the implementation of the action plan of the sector.

A review was conducted in 2009 to track the progress of the implementation of their Action Plan. Some adjustments to the Plan were done as a result of the review.

Another review was conducted to determine if results were achieved after more than a year of implementation of their revised action plan. The effectiveness of the Cebu Health & Wellness Council’s role as the steering body was also assessed. This is the report of such review.

                     

             

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Executive Summary

The November 10, 2011 workshop was designed and conducted to revisit the Cebu Health and Wellness sector’s Vision and Mission, the results of the implementation of its action plan and conduct a re-planning in case this is necessary. The workshop participants reviewed the vision of the industry and proposed an improved vision as follows: Cebu is a world-class destination for light medical, dental, and wellness tourism in Asia.

Based on industry and DOT inputs, a strategic objective was formulated which focuses

the sector on the Filipinos abroad as target market and a growth objective of 50% of the total medical tourists arrival in the next five years. Using this as reference, the workshop participants identified opportunities, contraints and needs of the functions in the value chain of health and wellness that should be given attention by the stakeholders.

After the participants offered possible solutions to the constraints and needs they

agreed that more involvement is needed from the stakeholders. This leaves the Cebu Health and Wellness Council with the challenge of continuing the effort to make the sector’s value chain more competitive and increasing the participation of other stakeholders especially the bigger and more influencial ones.                                                      

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1 Introduction

The objectives of the workshop conducted on November 10, 2011 was to revisit the Cebu Health and Wellness sector’s Vision and Mission, the results of the implementation of its action plan and conduct a re-planning in case this is necessary. To achieve the objective, the following program was designed:

• Preliminaries • Welcome Remarks/Overview and Rationale of the Workshop by Director Nelia

Navarro (Provincial Director-DTI Cebu) • Looking Back: Objectives and Major Activities, a report by Engr. Oscar A. Tuason,

Chairman of the Cebu Health and Wellness Council • Review of the Value Chain Concept by GIZ-PSP Component Adviser Uwe Sturmann • Market Updates and Prospects, a report by Dr. Clarissa Jenna Pe of the Philippine

Dental Society • Workshop 1: Review of the Industry’s Vision • Workshop 2: Formulation of the Strategic Objective • Workshop 3: Identification of the opportunities, contraints and needs of the

functions in the value chain • Next Steps

2 Workshops Results and Discussions

2.1 The Indudtry’s Vision The workshop participants reviewed the vision and mission formulated by the Cebu

Health and Wellness Council as follows:

Vision Cebu is the world-class destination for medical and spa/wellness tourism in Asia by

2010.

Mission To offer a world-famous Filipino brand of warm, nurturing, culturally- sensitive and

competent medical service at competitive prices in a Pacific Island Paradise – Cebu;

To position Cebu as the ultimate destination for quality medical and wellness tourism;

To provide a distinctly Filipino wellness experience that is holistic, environment friendly, professional and world class.

There were two things which were immediatlely pointed out by the workshop participants on the vision statement : 1) the year 2010, and 2) Asia. A suggestion was made to change 2010 to 2016. There was also a discussion on the geographic scope of the vision. After a lively discussion, an improved version of the vision was finally proposed:

Cebu is a world-class destination for light medical, dental and wellness tourism

in Asia.

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The group also articulated more specific indicators for the new vision : 1) that by 2015, they see world class hospitals that look like 5-star hotels ; 2) that the international airport would have a dozen boarding bridges, with more x-ray machines, and two more terminals ; 3) that there are more international flights to and from Cebu (e.g. Abu Dhabi) ; and 4) that medical and dental institutions are accredited with the Department of Tourism (DOT). The mission statement was not discussed during the workshop as this was to be done by the Cebu Health and Wellness Council.

2.2 Strategic Objective In analysing the value chain, data must be adequate to be useful in the formulation of the strategic objective. It is the strategic objective that would become the reference for identifying upgrading solutions for the functions in the value chain. The elements of a strategic objective include: 1) the product or service, 2) the target market, 3) the growth objective, and 4) the approach to achieve the growth objective.

The group recognized the need for reliable data, even admitting that the Philippines’ competitive ranking can improve if there are accurate data to base from and work on. This may be solved if all establishments would submit to DOT’s accreditation. Overall, there was the acceptance of the fact that it is difficult to capture data. However, the preliminary work of the Cebu Health and Wellness Council, the report of Dr. Clarissa Pe and the inputs from the representatives of the DOT provided the necessary data to formulate the strategic objective of the sector as follows:

To offer light medical, dental, and wellness services, to at least 50% of the

Filipinos residing abroad expected to avail of such services, through market development.

2.3 Value Chain Opportunities, Constraints, and Needs

The group examined each of the function in the value chain of the Health and Wellness sector in the light of the strategic objective they formulated. They brainstormed to identify the opportunities, constraints and needs the strategic objective would pose to the functions in the chain. These are presented in figure 1 in the next page.

It is important to highlight that the group did not find the need to focus on the hotels

as they recognized that the accommodations sector of Cebu is already mature. They also acknowledged that in terms of capacity, the accommodations sector is ready to absorb the growth that the health and wellness sector is targetting.

2.4 Upgrading Solutions Initial brainstorming resulted to the following possible solutions that the Cebu Health

and Wellness Council can consider:

• Improvement of website • Department of Tourism (DOT) accreditation of hospitals / clinics

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Figure 1. Opportunities, Constraints/Needs in the Value Chain

   

Accommo-dation

Treatment Inbound/ Outbound

Promotion Leisure Recovery

Specific Transportation Needs of Specific Patients (e.g. Helipads, PWD Access Aircraft)

Many healthcare professionals are exposed to tourism industry

Availability of sports and rehabilitation centers for recovery

1.Existence of adventure tourism facilities that offer an option for secondary product but the safety has to be ensured 2.Availability of creative groups (e.g. Art Holiday Cebu), Culinary experience

Cebu, as a world-class destination for light medical, dental and wellness tourists is not yet known by the target market

Hospitals and clinics are not accredited by Department of Tourism (DOT) but are now required

1.Healthcare professionals need to understand and appreciate the needs / requirements of medical, dental and wellness tourists 2.Hospital and clinic staff need to know the requirements of medical, dental and wellness tourists

1.Upgrading of equipment for safety purposes 2.Confusing mandates of Technical Education Skills Development Authority (TESDA) and Department of Health (DOH)

Opp

ortu

nitii

es

Con

stra

nts/

N

eeds

VC Functions

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• Information on costs of specific services from hospitals be made available to tour operators

• Specific medical and dental packages for tour operators • Human resource development of hospital / clinic staff • Information on accredited insurance companies be made available • Hospital site inspections by tour operators (CATO) • Availability of sports and rehabilitation centers for recovery

2.5 Next Steps

It was agreed that the Cebu Health and Wellness Council will push for the continuing upgrading of the value chain of their sector by:

• Strengthening the Council through clarification of their roles and responsibilities;

• Involving the different establishments that make up the various functions of the chain; and

• Increasing the membership of the Health and Wellness Council to extend to as much of the value chain, especially the big and influencial stakeholders.

3 Conclusion

The review workshop started after lunch of November 10, 2011 and ended before dinner. It was a short proceeding but the interest and enthusiasm of the participants made it very productive. The improved vision, strategic objective, the opportunities and constraints/needs, and the suggested solutions were proof that the participatory process used was effective. The Cebu Health and Wellness Council is expected to further the effort in upgrading the sector’s value chain by getting more willing stakeholders to be involved.

   

                                   

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List of Participants

1. Dr. Fredinida Nemezo Cebu Dental Care Center 2. Dr. Susan Uriarte Valmayor Cebu Dental Implant, TMJ and Oral Rehab Center 3. Engr. Oscar Tuason Cebu Doctor’s University Hospital 4. Mrs. Dawnie Roa CHWC-BOD Member 5. Dr. Sophia Mancao Dept. of Health-7 6. Ms. Judilyn Quiatchon Dept. of Tourism-7 7. Dr. Clarissa Jane F. Pe Philippine Dental Society 8. Ms. Joy Panopio Perpetual Succour Hospital 9. Mr. Jethro Estimo PUSOD 10. Chadelsea Binondo CBUH 11. Atty. Brandon Enad Bureau of Immigration-Cebu District Office 12. Ms. Ana Quisumbing Cebu City 13. Ms. Louella Cabaneros Mandaue City 14. Engr. Danilo Montana TESDA-Cebu 15. Ms. Lalaine V. Cabahug Mandaue City 16. Ms. Miriam Bacalso GIZ-PSP 17. Ms. Elpe Canoog GIZ-PSP 18. Mr. Uwe Sturman GIZ-PSP 19. Ms. Nelia F. Navarro DTI-Cebu 20. Ms. Esperanza Melgar DTI-Cebu 21. Ms. Marivic V. Aguilar DTI-Cebu 22. Ms. Teresita Emphasis DTI-Cebu 23. Ms. Marilyn Tancinco DTI-Cebu 24. Dr. Rene Y. Paquibut GIZ-PSP 25. Ms. Laura Rollan 26. Ms. Rosabel Flores DTI-Cebu 27. Ms. Cherie Canete GIZ-PSP 28. Mr. Philipp Schroeder GIZ-PSP

                                   

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Pictures    

                           

         

         

                         

     

           

     

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