Left Brain; Right Brain
There’s a definite “left-brain/right-brain” thing going on in the healthcare/insurance market for IT products and services. Take, for instance, workflow and its smarter, prettier cousin, “business process management.” As it’s supposed to do, process management can be proven to whittle down costs, reduce headcount, speed up work and generally recover dollars that didn’t need to be spent.
Any workflow vendor can easily do that. That’s a Thursday for those guys. But there’s a surprise ending in store for the smart customer who can take a leap of faith.
The Cycle Repeats
“We have a renewed focus on ROI, I’d say within the last year and a half,” says Tracy Shelby, Director of AWD Sales and Marketing for DST Systems. DST is a quiet but successful and long-lived provider of solutions in the financial services segment, and has expanded into other areas such as healthcare and insurance. “Wasn’t quite so important in the boom times, but it’s back.”
This “every-dollar-justified” atmosphere is nothing new to workflow vendors. The early days of workflow—way back in the early ‘90s—were distinguished mainly by the technology baggage that had to be dragged into the conversation. “Remember, PC hardware was a big item then. A large monitor alone was $4,000, for instance. So you had to pull a $10,000 to $12,000 ROI, per seat.”
History is repeating, except the primary cost factors now on the table are software implementation, services, maintenance and upgrades. So the everything-old-is-new-again mantra for workflow is hard-dollar payback. Or is it?
Not necessarily. Shelby provides an example: “We put together a cost-benefit analysis for a healthcare organization that, based on cost-savings alone, provided a great payback for the customer,” says Shelby. “While we’re patting ourselves on the back, we found out the customer considered the cost-savings ‘extra,’ and that their interest was mainly in solving issues that were causing them problems on the revenue side of their business-billing, collections, etc.”
Let’s not pick on healthcare; all transactions are complex. In any B-to-B relationship (and this might describe life in general) there are people on one side who want to be paid, and there are people on the other side who don’t want to pay. This is Life, get used to it.
An increasing number of BPM customers are starting to get the picture. Joanna Creamer is Senior VP for CSC (Computer Sciences Corp.), and sits across the desk from customers every day.
“Most of the companies I deal with—mainly in life insurance—are just starting to understand the impact that business process management can have on their operating costs and on their customer service,” says Creamer. “Insurance companies were early adopters of things like imaging and workflow, but they stopped there.” Why? It can be blamed mainly on certain cultural curiosities in business, such as the tendency of IT professionals to support projects that fund their departments, but not necessarily propel business performance.
“But,” Creamer is quick to note, “That’s changing fast. Most of the conversations I am having now are with CTOs, and that’s amazing! These IT guys do have an understanding of business problems.”
You Can Have It All
So you may think your whiz-bang business process management system will save you a few bucks. And it will. The left-brain, analytical, logical side of you will be totally satisfied. But let me appeal to both your brain-halves for a minute:
On one hand, you’ve got processes that can be automated, third-party suppliers that can be eliminated, transactions that previously involved scores of people reduced to one or none. Doesn’t take a Harvard MBA to see the cost savings lurking in there.
But then, get creative and imagine: what happens if bills go out with no mistakes? ... what if the insurer can find no basis to reject this claim? ... what if my supplier can accept my order electronically with no translation middleware? ... what if my call-backs drop to near-zero?
The increasingly smart company gets it, but it takes a Carl Lewis leap of faith. “People are less willing to trust vendors,” admits Shelby. “So, you have to have strong references, and you have to be very open to let prospects ask questions ... it comes down to experience.”
Says Creamer: “The goal here is help companies transform the way they do business. It’s rewarding to know that you can dramatically improve an operation in six months.”But how does she back it up? Creamer has a very faith-affirming strategy when it comes to convincing customers of her seriousness. “I’ve had customers who want me to share in their risk. I say, ‘Sure, if you’ll give me a percentage of your savings.’”Strangely, no one has taken her up on that offer.