Leveraging Consultants to Improve Automation Outcomes

June 2013 - Vol.10 No. 6 - Page #34
Category: IT/Automation Consulting

When pharmacy pursues new methods to increase efficiency through the greater use of automation, choosing the most applicable automation systems to suit specific needs can be a daunting task. Implementing the right systems for your pharmacy can improve both efficiency and patient safety, while selecting inappropriate or unnecessary technologies may lead to frustration and a waste of resources in trying to adapt a system ill-suited to your workflow. Seeking the advice of an independent automation management expert before choosing such systems may help increase the likelihood of a successfully implemented automation project.

Partnering with a consulting specialist can offer many advantages. Seeking advice solely from automation systems suppliers may limit your range of possible choices to their products, while working with a neutral outside consultancy brings a broader perspective of available options for the various automated systems to be considered. Even before a formal request for proposal, or RFP, is generated, a consultant can assist your team in identifying, defining, and quantifying the scope of work your project requires, ensuring that the RFP will accurately reflect your institution’s current and future needs. 

A top consultant will be directly familiar with the best (and worst) practices in hospital pharmacy, and as such, can assist in crafting a strong RFP that will help you to avoid costly mistakes down the road. An outside expert should be able to provide the analysis necessary to avoid the mistake of planning only for current needs, resulting in underbuying. Conversely, a thorough analysis of future needs can suppress the desire for overbuying in anticipation of capacity demand that may have little chance of occurring. 

Likewise, system interoperability requirements and assuring a good fit within defined informatics/automation architecture are often underappreciated factors that can benefit from the guidance of an independent expert. A consultant should also have the ability to suggest options that expand a client’s thinking to encompass any system-wide issues that may require innovation beyond standard operating procedures. 

Challenges from Administration
When hospital administration selects the pharmacy consultants, this presents a unique set of challenges for pharmacy. Oftentimes administration may be familiar with a particular firm from a previous project unrelated to pharmacy, or they may want to appeal to the board of directors by using an easily recognized big-name firm. The firms familiar to administration may not have the specific expertise needed for guiding pharmacy automation, whereas specialized knowledge and experience are critical to the success of such a project. Unfortunately, it is not uncommon for hospital leadership to utilize large, nonspecialized firms throughout the hospital to reduce overall costs, often with poor results. Generalists may have a limited understanding of the business of pharmacy and be unfamiliar with what is required to deliver a high-performance pharmacy service from clinical, operational, and business perspectives. The result is that they often utilize a formulaic approach with metrics and benchmarks that fail to recognize the unique nature of each operation and are not meaningful for the programs under evaluation. Beware the generalist firm offering a single solution­—formerly used for a previous client— that they are now trying to fit to your institution.

A real-world example of this one size fits all approach is the use of order actions per hour as a staffing and productivity metric. Use of this statistic fails to recognize the divergent distribution systems employed within various operations and the specific requirements and activities generated through these systems that translate to patient care actions. Consider, as an example, one hospital that was recently acquired by another health care system. The newly acquired, 500-bed facility’s pharmacy was operating with an informatics system and a robot to support central unit dose dispensing. It had a standard one-hour turnaround time for routine medication orders and was operating at 41 order actions per hour. 

The acquiring health care system used a different informatics platform and a unit-based cabinet model for distribution with an average of 26 order actions per hour. When the hospital was converted to the system’s informatics platform, order actions per hour dropped from 41 to 19 and turnaround time ballooned to 4 hours, essentially bringing the hospital to its knees. It was necessary to assign nine additional FTEs to restore the turnaround time to one hour. In this scenario, the staff at the newly acquired hospital did not suddenly become less productive; rather, the acquiring system’s informatics model in terms of how orders were processed, reviewed, and acted upon was not adapted to the hospital’s existing processes. Clearly a simple one size fits all metric is not a viable way to determine productivity or pharmacy staffing relative to informatics and automation.

Pharmacy at the Table
It is imperative that pharmacy has a place at the table throughout the consultant selection process. This may be difficult to attain, as pharmacy is not traditionally represented at the senior administration level. Because of this, pharmacy leaders need to present a strong rationale that convincingly explains how pharmacy’s participation in both selecting the consultant and establishing the scope of the project may help to avoid mistakes later in the process. Given that medications are the primary treatment modality for the majority of patients, represent one of the fastest growing expense elements, and are a major revenue contributor, it makes sense to include the people most knowledgeable about medication management in any key decision impacting this area. We all know the deleterious effects that can result from hiring the wrong employee; bringing the wrong consultant on board is no different. Because no one in the organization has a better understanding of pharmacy operations than pharmacy leadership, it makes perfect sense to include pharmacy in the decision-making process.

Even when pharmacy manages the selection process for an automation consultant, there still may be a number of challenges to surmount. Pharmacy leaders with limited experience in this area may be unfamiliar with the best approaches to obtaining consultant services. Also, pharmacy generally has a very limited budget for these services, and there may be a lack of understanding regarding the cost versus value ratio that a good consultant can offer. While C-suite leaders routinely work with engagements in the million-dollar range, pharmacy leaders are generally unaccustomed to reviewing even six-figure consulting proposals. Despite the opportunity for a high return on investment, pharmacy leaders may still balk at authorizing this level of expense, whether it comes directly from the pharmacy budget or from another hospital account. 

The hesitation by pharmacy leadership to commit to outside assistance also may be borne of preconceived ideas about (or past experience with) consultants who did not understand the business of pharmacy and were engaged solely to cut costs. These concerns might then be subliminally applied to all consultants. There may also be concerns that a consultant could uncover problems that would reflect negatively on current pharmacy operations or leadership. And some professionals may be averse to delegating responsibilities, particularly to outside sources. However, a good consultant should be able to candidly and clearly address these concerns and assure that they are operating in the best interest of the pharmacy.

Choosing the Right Consultant
The best way for pharmacy leadership to gauge a consultant’s skills is to interview potential consultants with the same diligence you would use if you were going to hire them as full-time employees. Look for a consultant who comes to the interview with questions, not just answers, and who takes the time to listen carefully to what you have to say. A potential consultant should be able to quickly understand whether your needs are of a strategic or planning nature, or if they require operational knowledge, resources, and skills not currently available, or possibly both. Also, look for someone who will be honest with you. A good consultant needs to be able to tell you things that you may not want to hear. 

You will also want to find a consultant who will fit well with the culture of your organization. A good consultant must quickly establish competency and trust with your team and must be skilled at change management. Ask to review the methodology that the consultant employs for change management. The consultant should have a well-defined process that will work for large or small projects. The consultant also must be willing to listen and empathize with your staff yet always advocate for the goals of the project. 

Closely examine and determine each candidate’s relevant skills and request examples of their work. Take the time to determine the goals of the project related to the work sample shared. What were the outcomes of their previous projects? Were there problems with those projects or did they help to grow a pharmacy program and produce positive clinical and economic benefit? Be sure to ask the candidate for references from past projects of a similar size and scope to what you are planning, and follow up with those references. It is also important to examine a consultant’s resume. Where did they work, and at what level of responsibility, prior to becoming a consultant? What did they accomplish in those positions, and how recent is their experience? 

A good consultant should recognize that each organization presents a unique set of challenges and, although some core elements of a solution may translate to all organizations, no single solution will work for every client. Results must be tailored to the individual needs of each institution. A good consultant will be cognizant of the following issues when making recommendations:

  • Goals of the organization and how pharmacy is structured to meet those goals
  • Current systems and standards for delivery of care
  • Geographic limitations/challenges 
  • Current informatics configurations
  • Current automation configurations
  • Current staffing levels and skill mix
  • Patient care initiatives
  • Patient safety initiatives


Gauging Capability and Capacity
Consider the reputation of the consultant’s firm. Determine how long it has been in business and how long has it been active in the pharmacy setting. Ask about the experience and capacity of its pharmacy consultancy. After completing an assignment, do the firm’s consultants tend to be invited back by former clients to perform additional work? You will want to have a sense of comfort with how the firm works with its clients. 

It is also important to verify that the consulting firm has adequate personnel and resources for your project. Make certain that the firm has sufficient depth to cover unexpected demands for additional resources. In the firm’s proposal, they should provide an estimate of when they can start work and how long it will take to complete the assignment, with measurable milestones. They should also be able to name the specific individual or team members who will actually execute your job; too often pharmacy begin the conversation with a leading member of the firm only to discover that a junior level staffer has been assigned to do the actual work. This is a fairly common practice among larger firms wherein senior partners are responsible for contracting new work and less experienced members are brought in to do the research and implementation. Often the result is that the less experienced staff member reports what you already know, with the senior partner later presenting the same findings. 

Consulting Proposals and Agreements
The firm’s proposal should include detailed information about the consultant’s fee rates and estimated hours for the project. There should be an understanding about fees for work beyond the scope of what is stated in the proposal should additional work arise during the engagement. There should also be a clearly stated policy regarding any additional consultant expenses such as travel, lodging, meals, etc. You can ask for a cap on expenses with anything above an agreed-upon amount requiring your written approval. 

In terms of overall fees, you may consider hourly rates, a phased approach, or a flat or fixed fee for a clearly defined statement of work. It is to your advantage to carefully evaluate these options so as to select the fee structure best suited for your project and organization. Hourly rates may be appropriate for shorter jobs in which you have a clear idea of the amount of effort that will be required. For projects with several defined steps, a phased approach may be the preferred option to allow your organization to pay for each phase before proceeding. On larger jobs, a flat or fixed fee covering the entire job may be attractive in terms of project budgeting and cash management. 

It is also important to understand the payment structure described in the proposal. Are upfront deposits required? What are the payment terms, such as net 15 days or net 30 days? Are there interest penalties for late payments? When is the final payment expected and what terms must be satisfied by the consultant before final payment is made? Finally, it is wise to make certain that your agreement includes language for a resolution process should any payment disputes arise. 

A concern for all health care providers today is the assurance that the confidentiality and security of protected health information (PHI) and personally identifiable information (PII) is addressed in the body of the consulting agreement or contract as well as in a separate HIPAA-compliant Business Associates Agreement (BAA). In addition, ensure that you maintain control over anything that includes your name and that of your health care institution should the consultant want to use it in the future. You will also want to verify that all of the consultant’s work using your data will be fully encrypted in the event of equipment loss or theft. The consultant must assure in writing that its processes for the use, storage, and disposal of your institution’s data are regulatory compliant.

Specific matters concerning rights to intellectual property and ownership of the final deliverables must be clearly delineated within the contract. As the client, your goal is to preserve your rights to any intellectual property that predated the consultant engagement while maximizing the value provided to your organization. The consultant will want to make sure that they retain their own existing intellectual property rights as well as those that they develop during the engagement. Some clients will ask to have the rights, titles, and interest to all work products and intellectual property created by the consultant assigned to them, which can be problematic for the consultant. The final agreement should clearly define and delineate intellectual property and work product rights and fairly apportion them between the client and the consultant with the outcome benefitting both parties. 

Automating the Right Work Processes
Once an automation decision has been made, a specialized consultant can help to extend and magnify the client’s implementation skill sets. It is quite possible that by providing expertise not currently present on your staff, the consultant can also assist with a more rapid system implementation with fewer conversion issues and other related problems. It should be noted that an experienced consultant would understand that his or her function is not just to automate current pharmacy processes. Rather, the consultant should provide guidance regarding best practices for pharmacy processes and assist in identifying the optimal automation that will provide the ability to effectively re-engineer these processes. This is not an easy process and involves several critical steps, including:

  1. A complete review and analysis of existing work processes 
  2. The identification of optimal work processes 
  3. Identifying the optimal use of automation to achieve work process improvement goals 
  4. Providing assistance during the transition to new systems and workflow processes

The goal throughout this exercise is to avoid automating poor work processes in which the new system simply speeds up these processes, as this may result in institutional leadership questioning the lack of improvement. By first identifying optimal workflow patterns, and then automating processes to reflect that archetype, the project has its best chance of achieving real savings through greater efficiency. This type of work may best be done by individuals with a global perspective as to what approaches drive success in various environments, from the standpoint of both workflow process and automation.

Used judiciously, a good consultant can be a tremendous resource to help pharmacy leaders extend the capabilities of their existing team and to implement new programs and services effectively. A qualified pharmacy automation consultant can help pharmacy leadership ensure proper project scope (addressing both current and future needs) and reduce the implementation timeline and associated problems. A good consultant can also provide an improved time value of money by helping an organization put a project that generates a positive return on investment into operation more quickly than could be accomplished using internal resources alone. With increasing cost and quality pressures, pharmacy leaders should not hesitate to consider using consultants as a cost-effective means to help advance initiatives.


James A. Jorgenson, RPh, MS, FASHP, is the chief operating officer at Visante, Inc. He has served on the ASHP Commission on Credentialing as well as the Councils for Legal and Public Affairs and Administrative Affairs and in numerous state-affiliated chapter affiliations. Jim has authored more than 30 publications and has made more than 100 invited presentations, both nationally and internationally. 

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