Issue link: https://beckershealthcare.uberflip.com/i/759111
18 Executive Briefing The Role Cloud Applications Play in Improving Hospitals' Bottom Line A s reimbursements shrink and mar- gins tighten, the need for hospitals to reduce inefficiencies and elimi- nate processes that do not add value for patients or clinicians is more critical than ever before. Many of the challenges facing health- care leaders — which we've previously reported on — combined with managing productivity in the wake of physician and workforce shortages are driving the need for flexibility and efficiency. Add the con- tinuing flurry mergers and acquisitions to the mix, and the need for speed and ac- curacy is more important than ever. More efficient operations and faster deci- sion making will only happen when access- ing relevant, timely data is intuitive and pain- less. And, you can only access this data and fully leverage the power of analytics with standardized systems that span vital busi- ness processes. An increasing number of healthcare organizations are finding that a comprehensive, cloud-based solution gives them the flexibility and efficiency they need to grow in a challenging business and regu- latory environment. Keith Lohkamp, director of industry strat- egy at Pleasanton, Calif,-based software company Workday, took the time to answer Becker's Hospital Review's six questions on cloud-based systems, and how they can in- crease efficiency and provide better insight and control into the hospital's bottom line. The healthcare industry is undergoing a period of rapid change as reimburse- ment models transition from traditional fee-for-service to pay-for-performance. How should hospital CEOs and finance leaders change their approach to cost management in this new era? KL: Cost management isn't just about cut- ting or maintaining costs, but figuring out which costs have the greatest impact on patient outcomes. In other words, hospital CEOs and finance leaders need to look at cost management not just as a means to save money, but also as a way to enable their overall financial strategy. For example, as CEOs and finance leaders determine the best way to serve their patient populations, balancing cost, quality, and patient out- comes becomes a key imperative that im- pacts how the hospital system is organized, and where and how care is delivered. Often, efforts to manage costs manage- ment happen too late, and they're not done strategically. Today's leader needs to get in front of and sustain and preserve cost savings. How can cloud platforms ease the in- tegration process after a merger or ac- quisition? KL: With any merger or acquisition, health- care leaders must not only address the questions related to alignment of strategy and priorities, but also address the oper- ational challenges of aligning processes and systems across the combined entity. This is often referred to as "systemness" and requires a series of decisions to be made, such as how will the finance department be organized? Which combined benefits plans will be offered? On which clinical and administrative systems will the organization standardize? Where are our greatest oppor- tunities for economies of scale and how do we support and enable? And, what does the new organization look like now and how should it look in six months or a year? Cloud systems in general can help ease the integration by providing simplified rollout to the acquired or merged organization without requiring software installation on local servers. In addition, cloud systems are capable of dynamically scaling to fit the or- ganization as it grows. However, the cloud alone is not the only driver to simplifying the integration process. Technology needs to be combined with the right capabilities to support continuous change. Hospitals evaluating cloud platforms should ask a number of questions in this area: • How quickly can we add or change an organizational structure? Does it take hours or weeks? • Can the solution help us get visibil- ity into the financial performance of the combined organization in the near term, even if all parts of the organization have not migrated to a single system? • What capabilities do we have to roll out new business processes over time without IT involvement? • Will the system help us promote and encourage our common vision through the information and visibili- ty provided to our employees? What self-service access will they have? • Do our leaders have access to the information they need to make deci- sions and understand performance and costs across the organization? • Does the system make it easier or harder to accomplish our integration and alignment plan? Understanding the answers to these questions will help assessments of wheth- er the cloud platform provides both the technology and capabilities to stream- line merger and acquisition activities. As an example, soon after selecting Work- day, one of our customers went through a merger with another hospital system. With older legacy systems, configuring and adding the new employees and loca- tions to the system might take weeks or months. Instead, with Workday, the hospi- tal system was quickly able to bring in the new system, and focus on driving continu- ity and consistency in processes. How can cloud-based systems help eliminate inefficiency and streamline everyday processes for clinicians and administrators? KL: To succeed, healthcare providers need three critical capabilities: visibility, flexibility, and speed. Providers need a complete view of their organizations and deeper visibility into costs, revenues, and talent to help inform strategic decisions. They also need the flexibility and speed to adapt as they execute on their strategy, especially their people strategy as they respond to shifts in market demands and competition for talent. To achieve this, many health organizations are adopting cloud-based systems which Sponsored by: