By Pamela J. Gallagher
In recent decades, many companies have adopted the maxim, “Do what you do best, and outsource the rest.” From the ability to focus on the core of their business to gaining outside expertise to boosting their quality of service, there are many reasons outsourcing may be appealing to an organization.
The healthcare industry, however, has long been resistant to the idea of outsourcing parts of their operations, with a tendency toward believing healthcare is “different” than other industries. But healthcare is a business too, and we need to take a look at the numbers before rejecting outsourcing. By keeping everything in-house, organizations drive expenses up unnecessarily. Hospitals don’t need a whole team of people for everything.
With the forced advent of remote working during these past few months, healthcare organizations may be more open to outsourcing options. Furthermore, with the financial challenges many hospitals are facing, now is the time to pursue what for the healthcare industry may feel like an out-of-the-box solution, but has been embraced by many other industries as a viable and profitable way of doing business.
Benefits of outsourcing
- Scalability. Outsourcing allows your organization to pay only for the expertise they need. Like with utilities, you only need the amount of electricity you use, not an entire power plant. Most outsourcing companies offer flexible packages, allowing you to start small (and much more affordably), and expand or contract the project or hours as needed.
- Dependability and continuity. For hospitals that only hire in-house, one employee leaving or taking extended time off can put an entire program or department at risk. Outsourcing frees your organization from being dependent on a single individual to reach its goals. In fact, outsourcing companies usually have a team of experts on call. Furthermore, when you contract outside your organization, you open yourself up to talent and expertise outside your geographical area.
- Less costly. Hiring employees and providing benefits, training, and the space and equipment necessary for them to do their job is expensive—especially if the job really only requires a few hours per week. Outsourcing gives companies access to up-to-date knowledge without the expenses that come with an in-house hire. Purchasing a slice of expertise could be a stepping stone to bringing services internally, but will give your organization the opportunity to discern whether an in-house operation is necessary.
Steps to make outsourcing work for your organization
- Consider your needs. Outsourcing may be a great fit for your organization’s needs, but it’s not one-size-fits-all. Consider your needs regarding costs and budget, expertise, team dynamics, control and access to information, continuity, and innovation, to name a few.
- Ensure customer and vendor needs and expectations are aligned. Make sure the processes you are outsourcing are well-defined with clear expectations. Communication is the key to making the relationship a success for both parties. Additionally, take necessary precautions to understand how the vendor protects the confidential information they may acquire for your organization, and what happens to that information when your contract comes to a close.
- Have a collaboration mindset. As Ralph Burns, senior solutions engineer for Harris Affinity, says: Vendors should be “a valued partner, not a line item on an expense report.” Enter into an outsourcing partnership looking to add value for the vendor you’re working with, not just for your organization. You and the outsourcing company you hire are trying to tackle the same challenges and are working toward the same goal. Outsourcing can and should be a mutually beneficial relationship.
About Pamela J. Gallagher
Pamela J. Gallagher is a senior healthcare finance executive with 20 years of experience balancing the reality of finance with the delivery of excellent patient care. As a consultant she instills financial discipline, streamlines processes to maximize revenue, and reduces expenses for immediate improvements and long-term results. She writes on healthcare, finance, and technology at gallaghersresulting.com.
Financial Software for the Healthcare Industry, Harris Affinity
When an Outsourcing Service Provider’s Lack of Domain Knowledge is a Good Thing, Outsourcing Center
Simple successful outsourcing, Computer World