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Utilization of Technology and Innovation to Manage Costs and Remain Competitive in Healthcare Management
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Table of Contents
1.0 Executive Summary 3
2.0 Using Technology and Innovation to Offer Affordable Services and Become Competitive 3
3.0 Sustaining Competitive Advantage Using Technology 4
4.0 Measures Aimed at Initiating Innovative Strategies 4
5.0 Available Innovations 5
6.0 Priority Technological Innovations 5
7.0 Qualitative and Quantitative Analytical Tools 6
8.0 Assessing Company Performance 6
9.0 Conclusion 7
10.0 References 8
1.0 Executive Summary
The healthcare industry is highly competitive and unpredictable. Private healthcare facilities need to consistently remain competitive to stay in business (Westra, 2017). One of the biggest impediments to remaining competitive is high operational costs. It’s virtually impossible to stay competitive while experiencing high expenses. On the other hand, delivering quality patient care at minimal prices is a delicate balancing. According to Graban & Toussaint (2018), cost reduction strategies must prioritize patient health. As the healthcare system becomes more cost-conscious, technology and innovation can play a crucial role in reducing operating costs and providing affordable healthcare. This report examines how a private healthcare facility can leverage technology and innovation to cut costs, provide quality affordable care, and remain competitive.
2.0 Using Technology and Innovation to Offer Affordable Services and Become Competitive
The facility will seek to reduce costs by automating routine administrative tasks. We will use basic digital systems available in the market to digitize patient data entry and retrieval to minimize the time spent on such administrative tasks. Other routine tasks such as booking appointments will be digitized to achieve cost and time efficiency. The hospital will make use of a digitized system to process insurance claims and collect payments. This process will help reduce disputes, minimize clerical errors and ensure fast processing of claims and payments to improve cash flow (Menvielle et al., 2017). Using analytical software to leverage big data and gain deeper patient insight will help reduce costs and personalize the patient experience. Targeting specific patient problems is cost-effective and improves patient experience significantly. To reduce costs for both the hospital and patients, the facility will invest in telehealth services. According to Langabeer et al. (2017), remote doctor consultations help cut overhead costs, maximize volumes and eliminate commuting costs for patients. If telehealth technology proves expensive to implement, we’ll consider partnering with other private facilities to pool resources and offer the service jointly. Managing staff schedules effectively is critical to reducing labor costs. While advanced AI-powered systems can be expensive to acquire, we’ll use simple off-the-shelf digital software for scheduling staff to ensure staff scheduling is managed efficiently. While controlling costs is vital, it’s equally important to maximize revenues to offset overhead costs. We’ll make use of search engine optimization to improve our website traffic. In addition, we’ll engage in targeted advertising via our social media channels to reach a large customer base at a low budget.
3.0 Sustaining Competitive Advantage Using Technology
The facility will acquire affordable technology tools to sustain a competitive advantage and achieve operational efficiency at minimal costs. While working towards cost minimization, we’ll ensure the technology adopted in operational processes prioritize patient well-being. The facility management will ensure that the information systems used in the hospital prioritize the collection of crucial patient data. We will use analytical tools to analyze patient data and create personalized care specific to individual patients. In addition, we’ll use technology to ensure that our processes provide significant cost savings to patients. We’ll explore the option of collaborating with other health facilities in technology such as telemedicine to generate cost savings for patients and us (Haleem et al., 2021).
4.0 Measures Aimed at Initiating Innovative Strategies
We’ll strive to make innovation part of the hospital’s corporate culture. Abd et al. (2019) assert that it is critical to encourage staff to pursue professional development programs and share innovative ideas. The management will establish a reward system to promote creativity among staff. The hospital management will strive to encourage innovation through collaboration. This objective will be achieved by partnering with higher learning institutions and technological start-ups to exploit common areas of interest where we can work together. Before implementing ideas, we’ll seek to start small through pilot models to minimize risks, optimize results, and control costs.
5.0 Available Innovations
The medical field is steadily adopting artificial intelligence and machine learning to process bulk patient data and aid in imaging, scanning, and diagnostics. Blockchain technology is now being used in health management to ensure the safekeeping and sharing of patient data. In addition, blockchain technology is critical in securing hospitals’ virtual payment processes from cyber fraud. Telehealth is another innovation available aimed at reducing costs and enhancing patient care. The use of big data to gain vital patient insight is an innovation taking root in the medical sector. Analytical tools organize and analyze historical data to gain patient insights critical for designing treatment plans. Healthcare facilities partner with technology firms to use the Internet of Things (IoT) and utilize the vast data at their disposal. IoT enables hospitals to use data to streamline hospital operations management (Aceto et al., 2020). To exploit these available innovations, we’ll begin by investing in affordable technological innovations. To achieve cost-effectiveness, we’ll partner with locally-based technology firms.
6.0 Priority Technological Innovations
As we strive to gain a competitive advantage, we’ll prioritize implementing technological innovations that are data-driven. Specifically, we’ll prioritize innovations that facilitate the collection and use of patient data to provide crucial patent insight. By using data to gain patient understanding, we will design personalized treatment and patient care plans. Customized treatment plans tailor-made for individuals are cost-effective for both the hospital and patients. In addition, personalized services will improve patient experience and give us a competitive edge (Bhatt et al., 2017). Our strategy will focus on acquiring readily available digital software for data management and analysis.
7.0 Qualitative and Quantitative Analytical Tools
According to Wang et al. (2018), health data analytics improves patient care, facilitates quick diagnosis, and promotes more personalized patient care. We’ll utilize several analytical tools:
Clinical analytics to utilize data from Electronic Health Records for patient-care management.
Revenue cycle analytics to gauge the financial health of the organization.
Operations analytics to manage resources, patient movement, and supply chain processes.
8.0 Assessing Company Performance
Porter’s five forces model is vital in evaluating how attractive an industry is. The analysis provides a framework for understanding the competitive environment and designing appropriate business strategies (Hillestad & Berkowitz, 2018)
Bargaining power of buyers: Consumers in this sector seek high-quality services at the lowest price possible. Since our facility is new, our customer base is still tiny. The smaller the customer base, the powerful they are and the higher their bargaining power.
Bargaining power of suppliers: The healthcare sector is dominated by powerful suppliers who leverage their power to extract higher prices from hospitals. We have a weaker bargaining position since we are still new and have not established strong relationships with suppliers. Higher costs of supplies will squeeze our profit margins.
Threats of substitute products and services: Substitute healthcare facilities offering similar products and services are abundant within our geographical location. We stand to lose customers if rival healthcare facilities provide much lower prices than us. We should aim to be more service-oriented than product-oriented to win the hearts of customers.
Rivalry among competitors: Rivalry in the healthcare sector is intense in the US. Intense rivalry can create price wars, leading to lower prices and reduced profit margins. We should aim to differentiate our offerings to fight off competition.
Threat of new entrants: The private healthcare sector is lucrative and attractive. New entrants will increase competition and lower prices, causing a reduction in revenues. We should plan to innovate our products, services, and processes constantly.
We need to be particularly keen on the threat of substitute products and services. The healthcare sector is comprised of facilities that provide near-identical products and services while customers can easily switch to other service providers with lower costs.
9.0 Conclusion
Managing costs effectively is key to achieving and maintaining a competitive advantage. The hospital needs to lower operational expenses to provide affordable healthcare to patients and maintain its competitive advantage. By leveraging technology and innovation, the company can realize numerous economic gains. The healthcare sector is highly competitive. Therefore, the hospital management should constantly scan the competitive environment and design practical strategies to remain competitive.
10.0 References
Abd Awang, H., Mohd Sapie, N., Yusof Hussain, M., Ishak, S., & Md Yusof, R. (2019). Nurturing innovative employees: effects of organisational learning and work environment. Economic research-Ekonomska istraživanja, 32(1), 1152-1168.https://doi.org/10.1080/1331677X.2019.1592007
Aceto, G., Persico, V., & Pescapé, A. (2020). Industry 4.0 and health: Internet of things, big data, and cloud computing for healthcare 4.0. Journal of Industrial Information Integration, 18, 100129.https://doi.org/10.1016/j.jii.2020.100129
Bhatt, C., Dey, N., & Ashour, A. S. (Eds.). (2017). Internet of things and big data technologies for next generation healthcare.https://doi.org/10.1007/978-3-319-49736-5
Graban, M., & Toussaint, J. (2018). Lean hospitals: improving quality, patient safety, and employee engagement. Productivity Press.https://doi.org/10.4324/9781315380827
Haleem, A., Javaid, M., Singh, R. P., & Suman, R. (2021). Telemedicine for Healthcare: Capabilities, features, barriers, and applications. Sensors International, 100117.https://doi.org/10.1016/j.sintl.2021.100117
Hillestad, S. G., & Berkowitz, E. N. (2018). Health care market strategy. Jones & Bartlett Learning.http://www.worldcat.org/oclc/1029788638
Langabeer, J. R., Champagne-Langabeer, T., Alqusairi, D., Kim, J., Jackson, A., Persse, D., & Gonzalez, M. (2017). Cost–benefit analysis of telehealth in pre-hospital care. Journal of telemedicine and telecare, 23(8), 747-751.https://doi.org/10.1177/1357633X16680541
Menvielle, L., Audrain-Pontevia, A. F., & Menvielle, W. (Eds.). (2017). The digitization of healthcare: new challenges and opportunities. Springer.http://www.worldcat.org/oclc/1003915298
Wang, Y., Kung, L., & Byrd, T. A. (2018). Big data analytics: Understanding its capabilities and potential benefits for healthcare organizations. Technological Forecasting and Social Change, 126, 3-13.https://doi.org/10.1016/j.techfore.2015.12.019
Westra, D., Angeli, F., Carree, M., & Ruwaard, D. (2017). Understanding competition between healthcare providers: Introducing an intermediary inter-organizational perspective. Health Policy, 121(2), 149-157.https://doi.org/10.1016/j.healthpol.2016.11.018
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