Revamp­ing Finan­cial Oper­a­tions: A Case Study of a Lead­ing Health­care Provider

INTRODUCTION

The Client is a lead­ing health­care provider South­east Asia with hun­dreds of branch­es. Estab­lished in the 1970s, its ser­vices cov­er lab­o­ra­to­ry, spe­cial­ty and pan­el test­ing and oth­er diag­nos­tic support.

THE CHALLENGE

The client’s Con­tin­u­ous Improve­ment func­tion had iden­ti­fied oppor­tu­ni­ties with­in the Finance func­tion to improve pro­duc­tiv­i­ty, man­age con­tracts bet­ter and improve pay­ment col­lec­tions. This would help to improve cash flow, sup­pli­er rela­tion­ships and cost reductions.

Renoir had already part­nered with the client for a pre­vi­ous suc­cess­ful assign­ment and were select­ed to pro­vide sup­port in real­is­ing these opportunities.

PROJECT APPROACH

An ini­tial 1‑week analy­sis of the Finance Depart­ment (Head Office, Region­al Offices and Branch­es) val­i­dat­ed and quan­ti­fied the oppor­tu­ni­ties and pro­vid­ed bet­ter def­i­n­i­tion on how to imple­ment the improve­ments. This result­ed in a 14-week engage­ment with the client with the objec­tives of improv­ing the entire con­tract creation-to-collections process, as well as improv­ing the pro­duc­tiv­i­ty of Finance staff.

The project kicked off with Renoir’s Focus Process® and was struc­tured into 2 focus areas:

1. Resource Opti­mi­sa­tion: Focused on Pro­duc­tiv­i­ty cal­cu­la­tions for Head Office, Region­al, and Branch­es, Span of Con­trol Analy­sis, as well as Relo­ca­tion Analy­sis for the Finance Depart­ment. This also includ­ed installing a Pro­duc­tiv­i­ty Man­age­ment Con­trol Sys­tem to be used by Human Capital.
2. Con­tract Man­age­ment and Pay­ment Col­lec­tion: Focused on improv­ing cre­ation of con­tracts, on time invoic­ing, active col­lec­tions, and prac­tice stan­dard­i­s­a­tion across the loca­tions. Imple­men­ta­tion start­ed with the selec­tion and train­ing of a Task­force, com­pris­ing six client staff, and sup­port­ed by a full-time team of Renoir consultants.

Renoir trained and coached the Task­force in its method­olo­gies, includ­ing behav­iour­al change tech­niques and strate­gies. In addi­tion, Renoir over­saw the project to ensure the com­mit­ted deliv­er­ables were achieved.

To achieve max­i­mum impact and buy-in, a joint Client-Renoir team reviewed results of the indi­vid­ual work­streams dur­ing the week­ly Man­age­ment Action Team (MAT) meet­ings. Steer­ing Com­mit­tee meet­ings with senior client and Renoir man­age­ment were also held on a fort­night­ly basis to pro­vide direc­tion, make key deci­sions, and ensure the project was on-track to deliv­er results. This approach allowed for a direct engage­ment with stake­hold­ers, which in turn improved own­er­ship and buy in from the wider client team.

IMPLEMENTATION

Renoir, togeth­er with each Man­age­ment Action Team (MAT) and with the strong sup­port of the Steer­ing Com­mit­tee, intro­duced sev­er­al improve­ment ini­tia­tives for the two work­streams. These focused on assess­ing pro­duc­tiv­i­ty and improv­ing con­tract man­age­ment, invoic­ing and pay­ment collections.

Key activ­i­ties for each of the work­streams were as follows:

1. Pro­duc­tiv­i­ty and Resource Opti­mi­sa­tion
   - Intro­duc­tion of an Atten­dance Con­trol Sys­tem to sys­tem­at­i­cal­ly mon­i­tor effec­tive hours worked
   - Span-of-control analy­sis for the Finance Depart­ment Head Office and devel­op­ment of a new organ­i­sa­tion­al struc­ture pro­pos­al
   - Pro­duc­tiv­i­ty cal­cu­la­tions for the Finance Department’s Head Office, sev­en region­al offices, and eighty-two branch­es, along with the intro­duc­tion of dai­ly activ­i­ty eval­u­a­tions to assist man­agers in iden­ti­fy­ing fur­ther oppor­tu­ni­ties
   - Relo­ca­tion analy­sis of Finance Depart­ment Head Office
   - Intro­duc­tion of skills flex­i­bil­i­ty charts to iden­ti­fy and close skill gaps for man­agers and their employees
2. Con­tract Man­age­ment and Pay­ment Col­lec­tion (AR Improve­ment)
   - Cre­ation of a Top 20 debtors work­ing group to focus atten­tion on 40% of out­stand­ing debt and enforc­ing cred­it freez­ing for bad debtors
   - Setting-up a con­tract review work­ing group to iden­ti­fy improve­ment oppor­tu­ni­ties with respect to the word­ing of claus­es and con­di­tions
   - Cre­at­ing cus­tomers cred­it rat­ing to iden­ti­fy good pay­ers and bad pay­ers. Joint ini­tia­tives from Mar­ket­ing and Finance Depart­ment were encour­aged to edu­cate bad pay­ers and turn them into be good pay­ers.
   - Imple­men­ta­tion of Account Receiv­able Man­age­ment Con­trol Sys­tems, cov­er­ing dai­ly and week­ly oper­a­tional KPIs, enforc­ing active col­lec­tion calls, mon­i­tor­ing per­for­mance via a dash­board and installing review meet­ings in the Head Office, Region­al Offices and Branches

I am very sat­is­fied with this project, it has exceed­ed our expectations.”

Pres­i­dent Director

KEY RESULTS