Overcoming Switching Costs for New Outreach Prospects

If I asked what your retention rate was for your clinical laboratory outreach program, would you know the answer? I bet you do, because it is a critical metric for measuring client satisfaction. Industry averages hover around 90 percent. “Stickiness” is good for our clients and for our programs. Clients hate the process of switching their office routines, and it is always easier to keep a current client than to get a new one.

While strong retention is good for our current client base, it certainly presents a challenge for a proactive sales team in getting new clients in the door. When your sales representatives are out in the field developing their pipeline, it is important for them to keep focus on how they are going to give the prospect a better service than what they have today. That is the only thing that will make them consider switching.

Here are the three most important areas for improving physician office operational efficiency:

  • Connectivity: Lab interfaces to EMRs, Meaningful Use office requirements, electronic portal for non-EMR practices. This is the greatest opportunity for a sales representative to show prospects increased office productivity by reducing manual paper orders, eliminating faxing and scanning of results, and ensuring completion of required billing information.
  • Infrastructure: Patients service centers, in-office phlebotomy (where allowed). Where you establish your geographical footprint will determine a good percentage of your market share, so getting this right is critical. Are you investing in locations that are convenient for the patients to complete their testing? Do you have customer service measurements in place to determine patient satisfaction levels? Helping your customers service their customers makes a good argument for making a vendor change.
  • Pricing: Competitive rates are important, but transparency is demanded (as noted in a recent article in HFM Magazine by Jeff Myers). More patients today are being moved into high deductible health plans, and this means greater patient financial responsibility. Patients that used to have 100 percent laboratory coverage are now cost-sensitive and expect hospitals to be competitive with their fee schedules.

Simple? Yes, I know. But are your sales teams focused on these key areas during their calls? Do they struggle with having a full pipeline, yet no new sales are coming in? If so, now is the time to provide laboratory sales representatives direction toward a consultative selling approach.

If you’re not sure how to accomplish this, Chi can help you capture the 10 percent of physicians who will be choosing a new laboratory vendor in 2016.

Jeff Geagan
Managing Director, Outreach
Chi Solutions Inc.

Solving the Puzzle of Laboratory Outreach Structural Requirements

The structure is the foundation upon which a business is built.  It determines scale, operating cost, and profitability.  Ideally, laboratory outreach is set up as a separate company or a distinct accounting entity within a hospital or health system to track business performance.  In addition to structure, outreach requires:

  • Updated systems (information technology).
  • Three- to five-year business plan.
  • Capital budget.
  • Operating budget.
  • P&L developed by Finance.
  • Management reports.

The ideal structure for laboratory outreach requires “out of the box” thinking.  No doubt many of you have seen the familiar nine-dot puzzle.  Try to connect the nine dots with four lines and without raising your pen from the paper:

inside-outside gif

 

 

 

 
Continue reading