Customer-Focused Labs Are Successful

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AS YOU READ THIS ISSUE, YOU WILL BE AMONG THE FIRST in the laboratory industry to learn that more than 50% of the nation’s hospitals are financially deficient and “technically insolvent or at risk of insolvency.” That’s according to Alvarez & Marsal of New York City, which analyzed the financial performance of 3,900 hospitals and released a report on its findings. (See pages 10-14.)

Certainly for hospital-based lab directors and pathologists, this may be one of the most significant intelligence briefings we bring you this year. It is a sobering fact that, by Alvarez & Marsal’s estimate, “2,044 hospitals, or 53% of the sample, had negative patient care profitability.” That means revenues from treating patients are not enough to cover expenses at these struggling hospitals. Alvarez & Marsal observe: “A ‘flight to (perceived) quality’ is occurring by both physicians and patients—creating a bigger gap between the fiscally strong and fiscally weak hospitals in a given market.”

Why are successful hospitals consistently profitable and capturing market share from weaker hospitals? Experts such as Alvarez & Marsal and McKinsey & Co. say the better hospitals succeed because they are close to their customers and offer quality care, an attractive facility, and customer-focused personal service to patients.

Success from a customer-facing and customer-focused business strategy is one common theme heard in many of the presentations delivered at this year’s Executive War College on Lab and Pathology Management, which took place in Miami earlier this month. As you will read on pages 3-6, lab industry leaders, innovators, and healthcare experts from such diverse, respected companies as Microsoft, Cerner Corporation, and DNA Direct all had a common element in their strategic recommendations to lab directors and pathologists. It was that providers and laboratories must be close to their customers to survive and thrive as ongoing reforms alter and transform the American healthcare system.

If you ask me, it’s not a coincidence that, in two different intelligence briefings in this issue of THE DARK REPORT—and within two entirely different segments of healthcare and laboratory medicine—the “customer-focused” strategy is identified as a critical success factor. Observant lab executives and pathologists will want to act upon this highly useful insight. It can play a vital role in contributing to clinical excellence and financial viability in the coming, tough years.

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