bioclinica fls roi ebook 2016

A Bioclinica eBook | 2016

Overcoming

ROI INITIATIVE: A TECHNOLOGY SOLUTION for INVESTIGATOR PAYMENTS

2| ROI Initiative: A Technology Solution for Investigator Payments

Managing investigator payments faces specific,

well-known challenges. Current systems are

fragmented and manual, and in most cases are

not transactional or financial-based. The result of

continuing with current processes is the inability

to manage the complexity of the contract and

budget terms that are negotiated and paid

throughout the course of a clinical trial. Current

document management systems (e.g., CTMS

and other homegrown systems) are based on

non-financial system information that doesn’t

manage or account for the accuracy of payments

made. Additionally, routine data monitoring

activity does not always include time or cost

for re-monitoring efforts related to past payment

activity (e.g., monitors do not evaluate past

payments that would be impacted by changed

data). This effort would require an additional

burden to operational personnel to perform this

type of activity, resulting in higher costs for the

clients. Not to mention that the monitoring and

re-monitoring efforts would delay the timeliness

of completing the site monitoring process. This

further illustrates that payment automation is a

critical piece in the overall drug development

space, as it impacts all areas of the clinical trial

execution process.

ObjectivesThe process of completing a ROI evaluation for any initiative requires that all parties consider the end goal of the initiative to determine if a company should make an investment, which investment option to make and the expected fi nan-cial or strategic outcomes. It is important that stakeholders consider the scope and objectives of the initiative so the approach is clearly outlined to reach the intended outcomes.

The outcomes can be validated against the established set of initiative criteria, which may include the following:

• The options analyzed are compatible with corporate and functional strategic plans and goals

• The model itself is technically sound

• Investment costs are accurate

• Expected functional benefi ts are attainable

Measuring the expected outcomes can be complex, as they include fi nancial, non-fi nancial, operational and technical factors. Additionally, linkages to the external value can potentially be signifi cant and worth evaluating if they impact the following:

• Lost opportunities due to poor processes or perceived issue(s) of ineffi ciency, inaccuracy or both.

• Shift of resources from non-traceable and non-billable activity to another revenue-generating activity.

• Shift of time from non-traceable and non-billable work to other mission critical work.

• Shift in billable re-work that dilutes productivity and profi tability.

• Shift in allocation/workload based on the removal of non-billable activity to allow better/process improvement in other areas: better monitoring, faster site onboarding, etc.

Many companies are plagued with the challenge of trying to analyze and determine their return on investment in a complex and dynamic environment where both tangible and intangible factors need to be considered. Robust models exist for measuring the tangible benefi ts in dollars and cents; however, measurements can be diffi cult and even challenging to identify and predict. This is largely due to quantifying signifi cant business impacts such as cost avoidance, opportunity cost, potential revenue and added service revenue, which may all be important to an organization. Additionally, it is hard to put a price on intangible factors such as client or site satisfaction, loyalty and enrollment acceleration and performance on trials. These are all leading indicators of a high-quality trial with access to timely and accurate data to make real-time development or trial-related decisions.

While there are measures that can be directly related to cost reduction or cost avoidance, other strategic yet nebulous business advantages such as “competitive advantage” or “improved quality” may meet strategic goals and objectives. Diffi cult criteria such as competitive advantage may be quantifi ed in terms of measures such as the increase in sales rates directly related to improved service offerings, greater market share and/or improved client experience and perception.

Finding the BenefitsFinding the benefi ts involves consideration from the key business owners/stakeholders. It is important that the evaluation includes the quantifi able, subtle cost factors or benefi ts as well as the intangible benefi ts. The organization’s internal drivers should be considered and may include but are not limited to:

• Political risk factors

• Organizational risk factors

• Business process risk factors

• Technology risks factors

• Issues of time, scale and resource factors

• Importance of business process analysis

Data Monitoring

Paymentprocess

Contractmanagement

Time of operational personnel

Financialdata entry

Financials

ROI

Monitoring efforts

Budgeting& forecasting

Contract


Because a lot of time is spent on ROI analysis (resource cost and time) the investment should be pointed in the direction in which a company is headed to avoid unnecessary expenses. The company strategies, goals and objectives should be considered in the process to ensure the time spent on the analysis results in a decision that can be quickly and effi ciently implemented while ensuring organizational results are met.

Business Process and Stakeholder AnalysisPart of the ROI evaluation process should include a review of business objectives for each of the relevant stakeholders. For example, an operations department head may be concerned with a bloated headcount, but a technology department may focus on integrating technology solutions that provide effi ciency and cost savings in business processes.

Analyzing the current business process is an important exercise that will highlight the needs, challenges and risk factors for each respective business owner or stakeholder as well as outline their roles in the initiative. In the case of investigator payments, each stakeholder should evaluate their needs in relation to the following:

Activities and pain points in the business process(es).

All possible solutions that may alleviate manual steps and pain points for evaluation to ensure robust comparison of options.

Possible risks in changing the business processes.

The fi nancial measures for each business owner. This may include hidden or harder-to-fi nd costs imbedded in other units or not tracked against the work activities.

Areas in which stakeholders can achieve cost avoidance (e.g., not adding headcount to scale).

Where opportunity costs, including additional revenue opportunities, may exist.

Future planning for system integration and interoperability to meet corporate business goals.

Each functional business owner should evaluate the strategic, operational goals and benefi t with thoughtful considerations and value in the following ways:

Business Owner Site Setup (Contracts/Payments/Activations)

Stated Issue/Ineffi cienciesIndividual and manual spreadsheets used/human interpretation of payment terms and setup parameters.

Desired Improvement Consistency and standardization of payment tool (removal of individual Excel tracking sheets).

Business Signifi cance Manual maintenance of Excel sheets. Transcribing data/information into multiple systems.

Action Items Identifi ed

Evaluate the human interventions/touchpoints and risks around selecting or interpreting how setup processes can be inconsistent or where errors may be introduced at the manual touchpoints.

Estimated ImpactElimination of time spent on re-work and managing multiple data entry points (e.g., Excel tracking, CTMS, monitor visit report, EDC, etc.).

Business Owner Project Management

Stated Issue/Ineffi cienciesRoutine site phone calls regarding payments and/or payment-related details. PM time lost on chasing down information within the organization.

Desired Improvement Minimizing site phone calls related to payment information.

Business Signifi canceLess PM overburn on project management unit. More focused time on site performance and enrollment metrics for the client.

Action Items Identifi edEvaluate current average of site-related communications that are related to payments and the volume of calls after solution implementation.

Estimated Impact Improved margin on project management administration activities.


Business Owner Clinical Operations

Stated Issue/Ineffi cienciesOperations staff are on the front line of site relationship management. Poor or ineffi cient payments can put a strain on site relationships.

Desired Improvement Operations staff are able to focus on monitoring and fostering site loyalty.

Business Signifi cance Loyal sites can be the edge needed for business to enroll challenging trials.

Action Items Identifi edComplete site survey specifi cally on payment-relat-ed feedback and their effects on site relationships and choices sites make when participating in trials.

Estimated Impact Improved overall site satisfaction and loyalty.

Business Owner Financial Operations

Stated Issue/Ineffi cienciesVolume of payment-status-related inquiries from sites for non-billable personnel across the cumulative clinical trials.

Desired Improvement SG&A time to research payment items and provide status update as needed.

Business Signifi cance Revenue/margin leakage decrease over time and stopping point.

Action Items Identifi edEvaluate time to research each payment question X total number of calls per month and by total number of trials.

Estimated Impact Time focused on project fi nancials/margin oversight and change order management.

Business OwnerAP/AR (Accounts Payable/Accounts Receivable)

Stated Issue/Ineffi ciencies Volume of trial-site-related follow-up on payments manually entered into AP system for processing.

Desired Improvement Import or effi ciency to the AP process.

Business Signifi cance More time to focus on AR and DSO metrics.

Action Items Identifi edIdentify what parameters would be necessary for an automated AP import to process payments on daily basis.

Estimated Impact Focus and improvement on AR and DSO.

Tangible Benefits and MeasuresEach of the key stakeholders should identify their goals and objectives

for the functional business area for which they are responsible. Once

goals and objectives are outlined, the benefi ts and measures can be

applied. The goals and objectives may include but are not limited to the

following:

Cutting costs by reduced headcount or minimizing

a department

Avoiding new hires and training expenses as payment volume

increases

Creating more revenue from the existing business process

Working within the same process

Fixing the current process with people, technology or both

Business owners should identify and document their benefi ts and

measure with the internal department and corporate goals in mind. The

consolidated list of benefi ts and measures can be mapped back to the

internal short- and long-term objectives to illustrate value.

Tangible Benefi t and Measure Table

Benefi t MeasureDepartment

ObjectiveCorporate Objective

Improved revenue/margin Revenue leakage/margin reduction

Headcount Static headcount with increasing volume

Productivity Increased ability to focus time on billable activity

Repeat business

Client survey results on reasons for selection of preferred provider, VOC, etc.

Estimated Impact

Focus and improvement on AR and DSO.


Intangible Benefits and MeasuresThe intangible benefi ts are harder to quantify. They are value

propositions that can have a fi nancial impact, but it is often hard to

measure fi nancial value against competitive advantage. Often the

intangibles address market pain points and ways to give the business an

edge. The intangible considerations should drive the means in which to

measure intangible success(es).

Intangible Benefi t and Measure Table

Benefi t MeasureDepartment

ObjectiveCorporate Objective

Increased site satisfaction related to payments Site survey evaluation

Improvement in site loyalty Site performance

Improvement in data entry quality/site performance

Timely data entry/data query rate

Improved payment accuracy and quality Data-driven payments

Client confi dence; full service award Repeat business

Competitive advantage New business

Evaluating the Cost-Savings SolutionsThere are several solutions that span the range of adding people to

incorporating technology. Each view or lens should be applied to the

evaluation based on the business owners and should build upon the

benefi ts, risks, cost factors and challenges deemed most critical to the

organization’s success. The value the solution brings to the organization

should be easily mapped back to the corporate strategies.

A quantitative improvement in total cost savings or increased revenue

may be a part of the overall benefi t picture; however, identifi ed

qualitative improvements can have a signifi cant impact on business

differentiation and strategic goals.

Cost AnalysisCost analysis is based on tangible and intangible benefi ts. Below is a

framework for quantifying benefi ts for both:

Cost Analysis: Solution

Expected Improvement

/ Benefi t Risk(s) Cost

Driver(s)

Oppor-tunity Cost

Avoid-ance Cost

Est. Time to Return

Corporate Objective

Functional Objective: Site Startup

Functional Objective: Project Management

Functional Objective: Clinical Operations

Functional Objective: Financial Operations

Functional Objective: AP/AR

Functional Objective: Technology/Innovation

Measuring Outcomes and ObjectivesIt is important that the solution selected for implementation and the

evaluation and measurement of the outcomes are distributed to all key

stakeholders along with updates. The feedback loop mechanism can

be the ROI document, which can be a living evaluation document that

captures key inputs throughout the process. These measures can be

utilized by other groups to ensure ongoing process improvement along

the way or to leverage them for other initiatives.


SummaryThe dynamic nature of clinical trials has resulted in groundbreaking

innovations over recent decades. In looking at the innovation land-

scape, EDC, IVR, ePRO, CTMS, etc. all share a common thread: system-

based solutions using automation to increase effi ciency, productivity

and scalability. Payment management is no exception. The amount of

development dollars spent each year on investigator payments should

be accurate, timely and transparent to ensure the development dollars

spent are correct. Automating this process will remove the inaccuracies

that have signifi cant impact across the entire development cycle.


bioclinica fls roi ebook 2016

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