How does your Health System Leak Funds?
May 11, 2021
TAG Inc. Wins 2 Globee® Awards in the 6th Annual 2021 American Best in Business Awards
July 16, 2021At TAG, we urge that optimized processes are the key to increased efficiency and productivity while decreasing leaked funds – especially in your health system’s procure to pay (P2P) processes. But how do you make a returned goods or exceptions handling process-improvement project a priority for your leaders?
Priorities vary depending on the level of decision making you have in your organization. You do not always need to hold the “power” to make a difference or kick start a project. With a bit of drive, persistence, and influence you can begin making an impact at any level – as a supply chain manager, AP clerk, or buyer for example. After all, who doesn’t want to streamline their tasks allowing your performance metrics to increase?
However, optimizing P2P processes is more complex than vying for change within your own department. Usually, these processes will involve supply chain and finance/accounts payable (AP). They could often even involve IT and policy changes that effect the end-user. So how do you get everyone committed to optimize processes and accept change? It’s not an easy task, but you can use the strategies below to exert influence without authority and jump start improvement.
Strategies for Influencing with Authority
Build Consensus
Recognize all participants that will be affected by process changes and make them feel as if they are part of the solution – not the problem. Finger pointing often happens between AP and Supply Chain and even within the departments themselves. When pushing for process change, be sensitive of this and empower others rather than exacerbating the issues.
Know the Process
Influence by understanding the current processes and areas where process gaps and redundant work is happening. The best tool for this is to create a map of each step of the process you are seeking to improve. Show where errors and gaps are occurring throughout the process as best you can. You won’t be expected to create a detailed map at the initial project pitch, but having a high-level process map will help show the importance of taking on a change project.
Recognize Accomplishments
Keep the conversation positive by recognizing specific achievements of departments and individual contributors. For example, congratulate supply chain for reaching their $3 million savings goal for the previous quarter. You can then explain how a process optimization project could add to the department’s savings goals for the next quarter by reducing errors that leak funds or streamlining processes to save resources.
Get Executive Support
Approach a member of upper-level management to get buy-in from a decision maker. Often that support system can act as the project champion allowing you to further your initiative with support already in place. Depending on your role, examples of this could be your health systems’ CFO, Supply Chain VP, AP Director, or Chief Strategy Officer.
Utilize Facts
Research and analyze your current processes. Know the figures such as the amount of leaked funds due to the current process, the number of FTE hours utilized, etc. Then find sources you can use for benchmarking. Reach out to peer hospitals or health systems to compare results or utilize third parties such as TAG that have the ability to benchmark your processes against like organizations.
For example, if you are wanting to push for a returned goods process optimization , gather facts that include:
- Amount of funds leaked due to returned goods
- Amount dollars recouped during a recovery audit
- Number and value of credits proceeded
- Volume of annual returns
- Types of products and “top” products returned
When possible, ensure you quantify and track data. This will be the way you measure success of your process optimization initiative. An example may be the amount of time saved on a particular task that adds to efficiency gains.
Respect Expertise
Recognize the expertise of your team and counterparts. Ask them for their input and opinions at the pitch of the project and throughout the execution. This will help with buy-in for the project and build trust and respect.
Borrow Authority
Reference sources of success outside your health system. As mentioned before, connect with peer health systems about metrics and processes similar to yours. Check in with third-party vendors that can provide industry knowledge and benchmarks. Bring up outside success and reference case studies throughout your project and decision-making process while asking yourself and your team, “What would the CFO of ABC health system do in this case?”
Use Active Listening
Understand the viewpoints, priorities, and biases you are facing when presenting a process improvement project. Verbally recognize other’s concerns and opinions to ensure they know they are heard while presenting your information, and never assume that you know where people are coming from. Take on the role to find out and show that you understand them. Also be flexible and speak to what you hear. If an AP clerk is complaining about a task taking too long, explain how taking more time up front saves time correcting errors in the future.
