Analytics and the Data Warehouse.

Effective CRM requires comprehensive data and applications to support analysis, data mining and communications management.

As more healthcare organizations adopt customer relationship management (CRM) solutions, the key to functionality and maximum return on investment is a comprehensive database supported by relevant analytical tools and strategy. These elements will make or break the effort in advancing the goals CRM is designed to achieve.

CRM solutions are not one-size-fits-all. Most have been built for product-driven industries and revolve around brand, price and quality. They deal with tangible products and have the ability to create demand. Healthcare, on the other hand, is uniquely service-driven and has the opportunity to create long-term, loyal relationships in an industry that has minimal product differentiation.

While healthcare can't cultivate demand for services such as heart surgery or diabetic services, it can promote disease education, prevention and wellness services. The goal is that when individuals need care, they will select providers with whom they have a wellness-based connection.

Healthcare databases have become increasingly sophisticated and voluminous, but users may still lack information. To strategically utilize the data available in healthcare today, a combination of data and application programs designed to work together seamlessly is essential.

The basis for a CRM healthcare program is the same as for any other business problem. It requires an integrated combination of data and application programs to support analysis, opportunity identification, data mining and communications management. However, the difference in healthcare is the specific information needed to build the database--technical jargon filled with complex patient, payor and provider codes, including procedural and diagnostic acronyms such as MDC, ICD-9, CPT-4 and DRG.

Experts assembling the database and working with the highly specialized and technical applications to support CRM functions must have healthcare industry background and expertise.

Components of the CPM Database

While much of the information needed to understand customers and prospects exists internally, the data is typically fragmented, incomplete and unsuitable for CRM purposes. Data quality continues to be a risk in database building efforts. It is critical that data sources are "cleaned," standardized and integrated by those who can assure the data will function the way it is intended to work with the proper analytics.

A comprehensive CRM data warehouse will provide a near complete view of individual patient and prospect activities, attributes and behavior at the household level, including:

* Internal information--captured from an organization's accounting and medical records.

* External information--captured from outside data sources.

* Computed information--software functions to analyze data such as market place projections and health risk and utilization assessment data.

An open relational database is best for scalability, security and expandability. Transforming the sheer volume and variety of data formats into an integrated healthcare database requires complex hardware and software knowledge and talent. Although these resources may exist internally, it may be more cost-effective and efficient to outsource the database build.

Analytical tools can search the comprehensive CRM database to answer questions that were previously unknown or could not be answered quickly. Which customers in our database have called the call center, come to a seminar, visited our website, did or did not have a service performed? How many females ages-35-45, with two children and no primary care physician live within a five-mile radius of our new women's center?

CRM analytics are essential for building the customer snapshots upon which CRM depends. There are three types of CRM analytics, with varying degrees of sophistication as shown in the chart. These tools, based on algorithms and statistics, can be grouped into three categories: information delivery and data analysis, data mining, and campaign management/ interactive questionnaire. Though they have varying degrees of sophistication, they all work together to form an integrated CRM information delivery platform.

Garnering Results

The healthcare database and CRM analytics are most effective when used as part of a strategic CRM plan that supports the organization's goals and objectives. The plan should analyze the organization's market position and focus on utilization of specific services. Components are:

* Gap Analysis: Market analysis of patient utilization patterns, programs, services, and competitors.

* Executive Interview: Survey of top executives to determine targeted growth areas, strengths, weaknesses and objectives.

* Goal Setting: Set goals based on market/gap analysis and organization status for each service.

* Best Prospect Identification: Use predictive data mining CRM analytic to select a ranked list to determine which individuals to contact for each program.

* Communications Strategy and Creative Offer: Develop a one year, multichannel (direct mail, Internet, call center) campaign to reach target audience (of those who have opted-in to receive such communications) with carefully crafted messages.

* Tracking and Analyzing Results: Compile active and passive responses monthly throughout the campaign. Review annually to determine shifts in market share, reassess gap size and success.

When used with an integrated CRM healthcare database and strategy, CRM analytics can provide the answers that organizations require to reduce costs, and increase market share, patient retention and loyalty.

CRM Analytics

                                                  Interactive
            Information                           Questionnaire/
            Delivery/Data                         Campaign
            Analysis           Data Mining        Management

Features    Standard query     Statistical and    Logic and
            based data         artificial         collection
            access and OLAP.   intelligence.      of specialized
                                                  information.

Required    Offers many        Predictive         Scores answers to
Knowledge   options for        scoring and        survey questions
            information        automated          with statistical
            extraction and     individual data    algorithms.
            manipulation,      analyzer,          Knowledge of how
            Knowledge of       Knowledge of how   to interpret data
            database           to apply program   and how to
            construction and   to database and    maximize
            query ability,     to interpret       interactivity.
                               data.

John N. Hallick is the CEO of Customer Potential Management (CPM) Corporation, headquartered in East Peoria, IL. Contact him at hallick@ cpm.com.