Download CRM in Health Care Is Gaining Momentum

CRM in Health Care
Is Gaining Momentum
CRM is a strategy that enables greater customer insight and more
effective interactions, and it fosters customer-satisfying behaviors.
by Joanne Galimi Gartner, Inc.
C
urrent marketplace dynamics reveal a predominant and
The Three Key Business Processes of CRM
growing customer-service focus in technology adoption.
CRM comprises the following three major business processes:
Health care organizations must view customer service
1. Sales, also known as technology-enabled sales (TES), refers
based on CRM and pursue strategies to enhance and maintain
to the application of technology to enable selling through all
customer satisfaction. The rise of consumer-driven health care,
sales channels, including selling partners and the Web.
as well as the increased consumer demand for accurate and
Opportunity management systems (OMS) lay the frametimely issue resolution, has forced health care organizations to
work for a TES application solution. An OMS is a combined
focus on front-office technologies to streamline processes and
business planning, forecasting, and account management
increase customer satisfaction. Many health care organizations
system. It is the backbone of a multichannel TES system
are finding that old ways of doing business no longer foster
enabling B2B selling across field sales, inside sales, and
strong customer relations.
external sales channels.
CRM is more of a journey than a set of tools. CRM is a
2. Customer Service and Support is responsible for retaincustomer-focused business strategy designed to optimize profing and extending customer relationships once a product or
itability and customer satisfaction. To realize CRM success,
service is sold. Customer service and support (CSS) applihealth care organizations must foster behaviors and implement
cations are front-office systems with back-end links to supprocesses, applications, and technologies that support coordiport a customer-centric environment. These applications
nated customer interactions throughout all communication
support and manage relationships with external customers
channels. CRM offers health care organizations the opportunity
(such as members and physicians) and internal end users.
to improve existing relationships and define new long-term
Functions within these applications include call tracking
customer relationships.
and escalation, configuration and workflow management,
CRM transformation begins when a health care organization
problem resolution, and knowledge bases.
chooses to become more customer-centric and addresses IT
3. Marketing, also known as technology-enabled marketing
requirements along with the change management (people and
(TEM), involves analyzing the marketing process and
processes) necessary to transform the enterprise. Executing a
automating it for the customer relationship cycle (selecCRM strategy requires long-term planning, synchronization with
tion, acquisition, retention, and extension). TEM requires a
market dynamics, and resource commitments. To form the founproactive strategy for using information and IT in marketdation for a dramatic shift in customer-interfacing behaviors,
ing efforts using data management, mining, analysis, and
health care organizations must have integrated systems and
reporting tools.
share common customer-interaction channels. To produce true
business transformation, health care organizations must ultiThe business processes that support CRM offer health care organimately succumb to the challenge of re-engineering their culzations the opportunity to enhance customer service and embrace
tures, processes, and IT environments.
one-to-one customer management. While the three business
CRM technologies enable greater customer insight, increased
processes that support CRM are critical for all industries, they are
customer access, more effective interactions, and integration
applied in a unique way to health care. Most industries are productthroughout all customer channels and back-office enterprise
driven and revolve around brand, price, and quality. They have a
functions. CRM is a business strategy
organized around customer segments
Joanne Galimi is a research director in Gartner’s research organization. Prior to joining Gartner, she was part
that
fosters
customer-satisfying
of the strategic planning team at Harvard Vanguard Medical Associates in Boston. Ms. Galimi has extensive
behaviors and implements customerhealth care experience, with primary focus in the managed care market in areas of system selection and
centric processes.
implementation, business process re-engineering, strategic planning, and customer relationship management.
188 • crmproject.com
INTELLIGENCE
sales-driven model that deals with tangible products, and they have
the ability to create demand. Product-driven industries rely on CRM
to understand consumers and increase sales.
Health care, on the other hand, is uniquely service driven and
requires health care organizations to understand consumer utilization or medical service needs and the associated costs. For
health care organizations, CRM provides the opportunity to create relationships and involve the customer in more active
patient care management. Health care organizations must
understand how these business processes are defined within the
context of health care and apply them
to fit a service-driven industry.
Health Care Stakeholders
The drug companies frustrate many prominent physicians.
Our most frequent response from physicians regarding their
pharmaceutical reputation is, “When will you show up offering
us unobtrusive tools that enhance the process of ‘doctoring’?”
The current list of large CRM pharmaceutical vendors is most
focused on enabling sales representatives to manage samples,
comply with Food and Drug Administration regulations, and
understand physician prescription history and influence. They
fail to provide the physician or patient with the crucial self-help
capabilities needed for unassisted informed decision-making.
For health care organizations, CRM provides
the opportunity to create relationships and
involve the customer in more active patient
care management.
Another unique factor in health care is
the different types of organizations and
stakeholders. In the health care industry
there are pharmaceutical companies,
health care payer organizations, and
care delivery organizations (which consist of hospitals, medical
groups, and physicians). The stakeholders among the three types
of organizations are members, patients, physicians, and consumers (potential members and/or potential patients). In addition, CRM adoption varies widely between pharmaceutical companies, health care payer organizations, and care delivery
organizations (CDOs). This is due to budgetary issues, a lack of
knowledge regarding CRM strategies, and many unproven vendor
solutions in health care. Unlike product-driven industries (such as
retail and manufacturing), where substantial benefits for CRM are
being realized, health care continues to lag in CRM success.
An effective CRM approach is critical to competitiveness as
pharmaceutical vendors exploit new communication channels
and management strategies. Managing and understanding data
is the basis for forming relationships with all stakeholders.
Pharmaceutical organizations are realizing that data obtained
during the clinical trial process can be used for CRM. Technology
can help lay the foundation for CRM by improving the accuracy
of the data collection process, as well as the analysis and report
preparation processes. Technology also organizes the information into more-easily accessed and manipulated data stores.
Sales
Pharmaceutical Companies
Pharmaceutical companies must provide information and services
to a wide range of stakeholders, including consumers, physicians,
payers, and care delivery organizations.
Pharmaceutical companies are aggressively purchasing CRM
solutions from large vendors that offer the full suite of products,
including sales, marketing, and customer service capabilities.
These products are proven in other industries and best fit the
needs of pharmaceutical companies developing and selling a
specific product. Pharmaceutical companies are planning a
gradual migration to a more robust Internet-built set of CRM
modules to drive down both IT and sales and marketing costs,
while keeping in step with elevated client demands. A new
generation of products for self-service and personalization,
together with traditional sales, marketing, and service products,
will make it possible for organizations to migrate from both
“homegrown” systems and packaged applications with complex
and outdated architectures.
Pharmaceutical organizations are actively deploying sales applications to sell more to existing customers and extend the duration of customer relationships by providing products and
services that are designed to meet specific customer needs. By
enforcing product, pricing, and business rules, sales applications: take the complexity out of selling; assure that the right
product configuration is selected and that only appropriate valid
options can be used; and deliver correct pricing, quotes, proposals, and accurate orders on demand.
CSS
Customer service and support applications and contact center
technologies are allowing pharmaceutical organizations to
manage, synchronize, and coordinate service, support, and sales
interactions across a broad range of communication channels.
Web-based solutions for customer service are also allowing users
self-service and assisted-service over the Internet. Applications
and solutions in today’s market are designed to leverage a
Defying the Limits • 189
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CRM in Health Care Is Gaining Momentum
company’s existing investment in telephony and systems
infrastructure, while enabling rapid deployment to the organization’s
contact center.
Marketing
Pharmaceutical organizations are taking advantage of marketing
applications for customer analysis and marketing automation.
They are using the software to analyze customer behavior patterns and insights, and implement those insights through personalization and outbound marketing. In addition, it is critical for
pharmaceutical organizations to streamline event lead-generation
and evaluation. Many pharmaceutical organizations are creating
real, measurable sales opportunities. Event
management solutions are being deployed
to automate pre- and post-campaigns, as
well as at-event lead capture, lead-value
determination, and quick distribution of
leads to sales.
Study results from clinical trials are
being used to facilitate data mining and
trends analysis to support ongoing marketing initiatives. Word-of-mouth marketing, facilitated by access to
sponsor-provided chat rooms, can also be a result of providing a
good experience for patients. Physicians who were active participants in clinical trials can be targeted to encourage
prescription writing for key drugs.
organizations have discovered that applying today’s technology
and best practices ensures tomorrow’s customer base. No longer
can payer organizations sit back and miss opportunities to
attract members or expect unsatisfied members to continue to
use the payer organization’s services.
Sales
Unlike product-driven organizations, payers currently rely little
on direct sales to individual consumers. Large employer groups
select and monitor health plans and pay the premiums. Today,
some employer groups are placing more responsibility on
employees and allowing them to evaluate and select health
Managed care is a highly competitive market,
and new technology has irrevocably changed
the landscape in which enterprises compete for
and retain customers.
Health Care Payer Organizations
Health care payer organizations (payers) interact with numerous stakeholders, including members, consumers/potential
members, brokers, and care delivery organizations (hospitals,
physicians, medical groups). Each entity requires a payer to create a CRM strategy to meet the unique needs of each stakeholder.
Payers are deploying niche solutions, including CSS applications and TES applications. TEM has not gained momentum
because of a lack of proven solutions in health care and the lack
of interest from payers due to other business and technology priorities. In addition, payers are taking a phased implementation
approach to CRM and are avoiding the implementation of a suite
of products that support all three business processes (CSS, TES,
and TEM). The reasoning behind this phased approach is the
lack of preparedness and resources to implement the full suite
of CRM-related products, and there are no proven suite solutions
in the health care market.
Managed care is a highly competitive market, and new technology has irrevocably changed the landscape in which enterprises compete for and retain customers. Health care payer
WEB LINK
Read about some of the keys to building stronger
relationships with your customers in Dave LaPlante’s
interview in this book and on the Web at www.crmproject.com.
190 • crmproject.com
plans individually. As sales models in health care evolve to a
more direct sales focus, payers are increasingly turning to the
Internet as a sales distribution channel. TES applications are
being implemented to support the full sales process as well as
Internet functionality, including quotations, underwriting,
billing, enrollment, and workflow tools. TES applications are
designed to streamline the internal and external sales process to
increase revenue, market share, productivity, and agent and
customer satisfaction, and to reduce costs.
Payers are also actively looking to opportunity management
systems (OMS) to manage revenue-generating sales activities.
Visibility is a must in any economy, and is even more important
in a tough economy. Given this, every payer needs the ability to
manage sales opportunities. OMS systems provide capabilities
such as call scripting, account/contact management, event tracking, lead distribution, forecasting, and pipeline management.
CSS
To increase customer satisfaction and support self-service capabilities, payers are actively deploying CSS applications. CSS applications enable payers to track, manage, and report information
in a timely, flexible, and even proactive manner. CSS is also able
to automate front-office business processes, provide data/information flow integration among business functions, facilitate fast
and flexible access to critical information, support business rules
workflow, and support new communication channels.
Payers are also implementing contact center technologies such
as email response management systems (ERMS), interactive voice
response (IVR), Web call-through, collaboration, and text chat.
Payers are prioritizing the adoption of these contact center
technologies based on the context of their CRM strategies and on
their degree of risk acceptance and how the technology might
INTELLIGENCE
positively affect productivity, contribute to customer intimacy, or
make an enterprise more proactive in addressing customer needs.
Marketing
Marketing techniques are being applied to medical management,
whereby payers use technology to support, profile, and predict utilization and cost with the goal of directing members to the right
intervention and thereby improving outcomes. The key is to understand both the clinical and psychosocial characteristics on patients.
TEM, especially via the Internet, is critical in the development of
collaborative medical management.
Care Delivery Organizations
Many care delivery organizations (CDOs) realize that the “C” in
CRM does not stand for just customer or consumer. There are
multiple stakeholders, and each requires the creation of unique
CRM strategies and solutions. The key CDO stakeholders
include: patients, health care payer organizations, pharmaceutical companies, and consumers/potential patients.
Providers are lagging behind in implementing CRM because of
an unclear understanding of how CRM can be related to providing a service to each stakeholder and not a specific product.
Because CRM is rather immature for CDOs, there are few vendor solutions in the health care market that target a specific
stakeholder, never mind all CDOs stakeholders.
CDOs need to know everything about their stakeholders and
their needs. The business processes that support CRM offer
CDOs the opportunity to enhance customer service and embrace
one-to-one customer management. CDOs are slowly progressing
tient arena, CDOs should focus on Web-enabling their scheduling
applications to enable customer self-service, so that they may
attract new customers with little incremental cost. In the inpatient
arena, CDOs with business intelligence analytics will be capable of
offering preferential service to referring physicians during periods
of underutilization to improve patient censuses. In the payer organization arena, superior business analytics will give providers better tools to understand their costs during the contracting process.
Marketing
Most CDO marketing efforts are on health promotion and preventive medicine. CDOs are formulating branding strategies and
developing online and offline marketing campaigns. The single
greatest area of TEM in the provider marketplace is the coordination of the CDOs’ online marketing strategies.
CSS
CSS applications include nurse-on-call applications, billing support
applications, and contact center technologies (IVR, CTI, ERMS).
CDOs have tremendous administrative overhead costs tied into coordinating patient care activities (e.g., patients, referring physicians,
payer organizations). Each of these stakeholders has different needs,
requirements, and roles in the patient care process. One of the most
significant cost categories for CDOs is the expense of labor to coordinate these players. Furthermore, many of the most vocal complaints
by consumers and their providers involve poor customer service
related to insurance processing and bill payment.
CDOs are also developing portals as a communications channel
to manage interaction between patients, physicians, hospitals, and
health care providers to increase customer
loyalty, reduce costs, and increase market
share. The portal can supply visitors with
specific health care information, services,
and benefits (e.g., online prescription
orders, health risk assessments, chat
rooms, and the ability to communicate via
email with physicians).
Enterprises no longer view their customer
base as a homogenous collection of revenuegenerating units. Instead, they want to be
more personal with clients.
toward CRM strategies that incorporate Web-based consumer
self-services (e.g., registration, scheduling, bill payments),
online marketing campaigns, and customer service initiatives.
Sales
CDOs are turning to the Internet as a sales channel for customer
acquisition. A technology-enabled customer acquisition strategy
not only involves automating the customer-acquisition and sales
process, but also determines which customers should be targeted
and through which channel. This requires CDOs to be far more
proactive in their customer-acquisition strategies. Many CDOs are
focused on implementing enterprise scheduling and registration
systems as the core of their customer acquisition strategies. In the
future, these goals will become more far-reaching. In the outpa-
Bottom Line
Enterprises no longer view their customer base as a homogenous
collection of revenue-generating units. Instead, they want to be
more personal with clients. As the health care organization
grows, however, it becomes increasingly difficult to provide personalized levels of service. CRM projects focus on integrating
and leveraging all of a company’s outward-facing actions to
acquire new customers, retain existing ones and, most importantly, identify the most profitable prospects. Acting on the
notion that effectively managing the customer relationship from
initial contact through follow-up services yields the greatest
chance of keeping customers satisfied, companies are deploying
CRM-enabling technologies, such as call center software and
self-service Web sites, to please the “never-satisfied customer.” ■
Defying the Limits • 191
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