News Update Sept 2008

September 24th, 2008

No one needs reminding that this has been a tough year for most people. It has been tough for us as well. Our major client decided to take a slower approach to installing Frontline. The good news is that when we actually started, we moved into Medical Records (HIMS) first, where they were already doing well with an increased workload (EMR) and a reduction of 2.0 FTEs below their budget of 60.0. But three months later when we finished, they were operating with 38.0 FTEs and the three managers were sure they could reduce even further, without negatively impacting the quality or process. The hospital loved the results and we are now installing our software into more departments through the rest of this year.

Ironically, tough years for the US economy are usually better for our business, as our focus - helping the front lines define their real need for FTEs - is in line with the need to reduce labor costs. Yet our business model for the last few years has been focused upon the software! I think this has been a mistake. The software supports our work in reducing labor costs but is NOT the primary function of our company. With or without the software we reduce labor costs and improve the quality of front-line management. Managers love our process: it empowers, educates, and validates. Senior management sees the improvement as it shows up on the bottom line and the managers have a new confidence and perspective on how they manage.

The problem has been that when we make a sales call the discussion is all about the software. Everyone loves our software, “it is the best tool that any manager could have”. BUT when the discussion circles around software and implementation and interfaces, the whole reason for our work gets bogged down and lost. Fortunately we do have a way around this; we work off our own servers using Frontline to define requirements and show the managers. They continue to use it offline and demonstrate their own success. If senior management likes the results they can then decide to “bring it in-house”. No shifting the focus, no problems, no mumbo jumbo software discussions. Let us know if you or your colleagues want to see these results in your areas in just a few short weeks. Our standard guarantee is that we will identify 10% labor savings, and we usually do better than that. Sure, our software is easy to install and the savings will be easy to see. So let us focus on getting results and we will work off-line to get you those results. No IT issues. Just results.

David Theiler

Delivering Quality and Saving Labor Costs

February 24th, 2008

The ability to balance delivering quality service (goods, services, etc) and the cost of the labor (all skills) is the essense of good management. The irony is that you cannot have one without the other. Once this fact it recognized it becomes easier to determine what our parameters will be. Each enterprise starts out with time to complete its objective, this in essence is our labor cost. Determining what we can pay for this labor to complete the task determines in many ways what the quality will be. Too high a labor cost over too long a period of time will inevitably end the endeavor in failure. Too little attention to the skills required and the amount of time needed to complete the task will end the endeavour with low quality and no one interested in the product. Addressing this balance is vitally important to the front line managers. Your frontlines are your bottom line. Most managers understand each area of the department and its function. They could usually do the work in any area themselves and pride themselves on this knowledge. Yet understanding the cost involved, wether it is ‘morale’ of staff (balanced assignments), patient satisfaction, budget or productivity is not a daily planning feature of most managers. The fact that they do not have readily available tools that simplifies this step compounds the issues that surround the frontline manager.

Performance Not Budget

May 16th, 2007

At the frontlines of management, particularly in hospitals the sheer overwhelming number of things to do can burn out new managers. Now on a salaried track there is frequently little if any day to day mentoring. Each Manager has to find ways to manage not only their staff and the quality of patient care but to also manage the frequent ‘important’ meetings too. Add to this is a seven day work week (always on call) and the responsibility to meet specific criteria (budget, patient satisfaction scores, staff retention, overtime and registry usage, discharge times, etc) can be overwhelming. Given all these complexities, it is little wonder that managing to budget (Hours per Unit of Service or HPPD) becomes the measured standard for most Hospitals since it is comprised of a single static number.

However, HPPD is typically based upon the number of patients (not their acuity), averaged over the past year. Then, depending upon the ‘negotiated’ labor budget a Manager can be given more or less staff than is needed. In either case a problem arises. When a unit has more staff budgeted than they require we most often see that Productivity performance is quite low. (Productivity being the Required Hours (based upon the acuity of patients and other variable and fixed activities) divided by the Worked Hours for the staff. Left unmanaged, the HPPD measure will slowly and in most cases rise artificially, to approximate the budgeted level. Conversely, when a department is understaffed and constantly performing below budget there is no mechanism to explain the discrepancy without a Productivity performance standard in place.

Having both indicators (Budget and Productivity) is the first step to helping front line managers understand the difference between these two measurements, and then use that information to make informed management decisions.