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Exhibit 1

KEY TERMS | PRODUCT | GEOGRAPHIC AREA | TEAM ORGANIZATION | DELEGATION PROCESS, AUTHORITY, AND ACCOUNTABILITY | TECHNIQUES OF DELEGATION | PARITY OF AUTHORITY AND RESPONSIBILITY | CENTRALIZATION VERSUS DECENTRALIZATION | MAJOR TYPES OF ORGANIZATIONAL STRUCTURE |


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  1. SEXHIBITION

Value Added, Economic Development, and Academic Medical Centers. [4]

Why should a state support academic medical centers? Because of their unique research and teaching mission and the patient mix, costs are almost always higher than at other hospitals. The quality of their services may or may not be better than that of competitors.

In addition to patient care, academic medical centers can be valuable aids for economic development. Three academic medical centers in Virginia, for example, have reported that they spend $2.7 billion each year on goods and services, employ 26,520 people, and create an additional 31,591 jobs among private sector firms that sell goods and services to the centers. The result­ing impact is significant:

1. One dollar in every $84 in the state can be traced to academic medical centers.

2. State government receives more than $116 million in tax revenue as a direct result of the centers’ operations.

3. Visiting clinicians, patients, and students inject another $103.8 million into the state’s economy

4. Patients from outside Virginia who came to the state for specialized care spend $30.6 million on nonhealth-related goods and services.

5. In 1995, biomedical research conducted at the medical centers brought in more than $160 million in research funds.

The report, based on a study by Tripp, Umback, and Associates of Pittsburgh, indicated that academic medical centers are good investments and add considerable value to the state’s economic development activities.

From another perspective, recent news events, according to a report in The Wall Street Journal, should have executives making supply chain man­agement a top priority as revealed by Mattel’s recent recall of millions of lead-tainted toys from China, which followed fears about hazardous materi­als in toothpaste and pet food and a recall of thousands of tires made in that country. According to the report, “Don’t wait for a crisis. Scrutinize manu­facturing suppliers and improve quality-control systems at your company. Otherwise, you risk moves that damage your company’s brand and can trig­ger lawsuits”[5] and might lead to a loss of competitive advantage. It is inter­esting to note that subsequent to that recall, Mattel’s Executive Vice President for World-Wide Operations apologized to China, indicating that “Mattel takes full responsibility for these recalls... and that it’s important

for everyone to understand that the vast majority of these products that we recalled were the result of a design flaw in Mattel’s design, not through a manufacturing flaw in Chinese manufacturers.”


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