The healthcare industry is often under immense economic pressure. Any area that can be streamlined, have its expenses reduced, or be run more efficiently will be under careful review. Reducing overhead while still being able to provide the care and service patients need is very difficult. Many hospitals reduce staff to the bare minimum to meet budgetary needs, which can lead to reduced levels of care and overwork.
Hospitals have tried various methods to reduce costs without reducing care or reducing the size of their staff. One method from the business world seeing use in the medical industry is the use of Lean Management as a strategic tool. At its core lean is a waste reduction strategy that focuses on efficiency and on reducing waste of all types be they financial waste or wasted activities. Proper application of waste reduction methods can remove the need for staff adjustments and one such method is using predictive analytics help prevent hosptial layoffs. Let’s take a closer look at predictive analytics as a concept and a strategy.
In both the medical field and business fields data is essential. Predictive analytics takes data from past events and uses it to predict future outcomes. This is a very important piece of information to have as it can allow you to prepare future needs and baseline levels of performance needs. For the medical industry this can allow you to know how much staff you need, equipment needs, medicinal needs, beds needed on average, and more. With such a streamlined and efficient process you cut waste without having to lay off staff. Plus you make better use of the time and effort of the staff you currently have.
Why Layoffs Are a Bad Idea
Layoffs are a common budget control method, and often they are used in place of better methods that require more time and effort to implement. Simply put layoffs are a short-term solution and one that has many negative drawbacks.
- Negative Morale: in any workplace layoffs have a negative impact on the morale of the remaining staff. It sends the message they are expendable and when that happens many workers will start looking for a new employer which they feel offers more stability.
- Loss of Top Performers: when employees start looking for a new job en masse some of the first workers to receive new opportunities are your most experienced and essential staff. This is because your top performers have the expertise, training, and education that many hospitals want in their employees making them ideal hiring targets.
- Long Term Financial Issues: paradoxically while layoffs are often done to save money they often have a long-term negative impact on expenses. This is because laid-off staff still has to be paid severance and other associated benefits. Also, with fewer workers, overtime can become a need that further increases employee costs over the long term,
- Lessened Reputation: when a hospital has layoffs it will not escape the attention of local news channels and print media. This can damage your reputation in the community. Potential patients will question how healthy the hospital is and the quality of care provided when they hear about reported layoffs. Local businesses and potential hires will also hear this news and look elsewhere for hospitals with a healthier reputation.
When your hospital’s budget needs adjusting there are several methods you can use. The important thing is to not overreact and make sudden choices that can prove damaging in the long term. By taking a long-term approach you can focus on your methods and procedures to see where waste can be eliminated and by using predictive analytics removing the need for employee layoffs.