BEST PRACTICES RESEARCH

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1 Frost & Sullivan We Accelerate Growth

2 Contents Background and Company Performance... 3 Industry Challenges... 3 Product Family Attributes and Business Impact... 3 Conclusion... 7 Significance of Product Leadership... 7 Understanding Product Leadership... 7 Key Benchmarking Criteria... 8 Best Practice Award Analysis for hc1.com... 8 Decision Support Scorecard... 8 Product Family Attributes... 9 Business Impact... 9 Decision Support Matrix The Intersection between 360-Degree Research and Best Practices Awards Research Methodology Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices About Frost & Sullivan Frost & Sullivan We Accelerate Growth

3 Background and Company Performance Industry Challenges In today s diagnostic laboratory environment, competition among independent practices is growing and laboratories are struggling to cope with slashed reimbursements. It is important for laboratories to both retain and attract more clients in order to keep their revenue flow intact; therefore, they must become customer centric. Diagnostic laboratories are rich in data that must be presented in a way in which laboratory staff can provide outstanding service to clients. It can take weeks or months from the time a lab manager requests a report for the IT department of a lab or hospital to produce the information required to spot client issues or resolve a case. The lag time involved is often associated with manual client reporting that makes it difficult for the lab to take proactive, timely action upon the occurrence of client issues. Healthcare-specific Customer Relationship Management (CRM) meets the specific needs of laboratories by replacing loose data capture and issue resolution practices that may include s, excel documents, and even Post-It notes with up-to-the-moment intelligence available to all key stakeholders. An interesting survey from Harvard University points out that an average healthcare corporation loses almost 50% of its clients every 5 years. The cost to acquire a new client is almost 10 times as much as to retain an existing client. The reason behind this loss is that most clients never complain and the effort required to tap the source the problem lies deep within endless silos making it impossible to track the root cause of the problem. Several vendors offer industry agnostic CRM solutions to healthcare organizations. Their generic CRMs include a variety of challenges; for instance, a database that is shared with other clients, creating high security risks because of multiple users. Generic CRMs also consist of rigid standard objects, and it becomes expensive to customize them to fit a healthcare organization s specific needs. Often with a generic CRM, many-to-many relationships require expensive customizations to map relationships between objects. As a result, a physician having relationships with multiple healthcare locations or a lab having relationships with many hospitals becomes a difficult aspect to track. Further, ensuring HIPAA compliance by encrypting all data sets becomes costly. These challenges can become larger problems for a laboratory or a healthcare organization. For instance, in an acquisition or a merger, several laboratory information systems (LIS) and billing systems must be consolidated, and the CRM system will need to capture the critical information to set action items. Also, when physicians order tests with little attention to best practices, laboratories run the risk of losing money by ordering tests that are not covered by Centers for Medicare and Medicaid (CMS). A generic CRM does not provide insight into detailed test ordering practices, and as a result a physician s visibility is limited. Frost & Sullivan We Accelerate Growth

4 Today s healthcare landscape requires diagnostic labs to deliver on the promise of truly customer-centric service. A healthcare-specific CRM bridges the gap between big-picture service initiatives and day-to-day client interactions, enabling the lab to create and maintain profitable relationships with its clients (such as physicians). The healthcare-specific CRM invented by hc1.com, the hc1 Healthcare Relationship Cloud, automatically translates clinical and business data into insight that drives action, accountability, and targeted communications, which are critical aspects of delivering superior service levels. Product Family Attributes and Business Impact Matched to Needs hc1.com is a healthcare cloud company that offers unprecedented visibility across the healthcare spectrum from health systems and laboratories to physicians and patients. Its sole business focus is on making healthcare organizations more effective by personalizing the healthcare experience for customers and driving measurable accountability improvements across the continuum of care. In addition to creating holistic provider and patient profiles that include all relevant business and clinical information, its solution provides insight into key metrics such as lab orders by physician, specialty, and diagnosis code. Armed with this powerful intelligence, labs are able to deliver proactive, highly targeted service to that ultimately translates into stronger client retention and growth. Product and Service Value Solving Critical Issues in Workflow The hc1 solution has been successfully activated across hundreds of client locations. At Alere, a global toxicology laboratory with nine core lab locations, the hc1 platform eliminated data silos while improving the communication across the entire organization. With multiple lab information management systems, billing systems, and customer service centers, aggregating client data in order to deliver a unified experience proved to be a considerable challenge requiring extensive manual data tabulation for Alere. Without having to replace existing systems or place a burden on its IT staff, the organization used the hc1 platform to unify data into a holistic, client-centric view that enables a consistent client experience across all locations. Client service and business development are automatically notified of volume changes so they can immediately respond to issues and promptly handle the problem, or, if necessary, assign action items to another department and track their resolution. This global view has eliminated any grey area related to Alere s service levels and aligned the organization with its testing clients, leading to long term, successful relationships and reduced client churn. With robust communications and alerts embedded within the hc1 platform, labs and physicians are able to receive notifications straight to their computer or mobile phone, ensuring that essential intelligence that drives action and accountability is immediately available to those who need it. Frost & Sullivan We Accelerate Growth

5 Test Coverage and Ordering Best Practices Another critical aspect for most labs functions is gaining insight into test coverage patterns. Laboratories and health systems run the risk of losing money when tests are ordered that are not covered by the Centers for Medicare and Medicaid Services. hc1 s utilization capabilities are synced with the National Coverage Determination (NCD) database within the dynamic platform. The NCD shows which tests are covered by CMS so that labs and physicians can make informed decision when ordering them. Users have insight into the count of tests declined under NCD by diagnoses, specialty, and CPT code. Identifying New Clients and Business Opportunities Investing in the hc1 solution can also help laboratories with outreach activities. By tracking their total test volume and number of tests run per patient, laboratories can set up campaigns for specific tests by specialty, which helps them identify new practices or groups and widens their footprint of referring providers. hc1 tracks changes in order volume by physician, ordering location, and specialty, so a laboratory can proactively identify at-risk clients. A lab can also set up custom alerts on a variety of factors, for instance, if a physician places an order for a test that is inconsistent with the diagnosis standard set by the utilization committee an alert can be triggered. hc1.com distinguishes itself because its solution combines the capabilities of both healthcare-specific CRM and business intelligence in a single platform to provide insight and action. Growth Potential Founded in 2011, hc1.com is rapidly expanding its customer base, which grew by 215% in 2014 to more than 600 healthcare client sites in five countries. Several partners, such as IBM Watson, Beckman Coulter, BigTinCan, and Laboratory Billing Solutions are helping the organization become the world s most widely connected Healthcare Relationship Management platform in the diagnostic laboratory market. For instance, through its hc1apps platform, hc1 offers a comprehensive database that covers all types of healthcare providers from physicians to Accountable Care Organizations (ACOs) and payers. Through hc1 s extensible platform, the hc1app is able to securely access client contacts, industryleading market insights, and claims data. Beckman Coulter, a global lab instrument and automation company, provides solutions powered by hc1 that enable their clients to derive strategic value from data that was historically trapped in silos. With hc1, Beckman Coulter s clients see real-time information on the provider clients who are depending on the lab to service their patient populations. The adoption of hc1 is spreading from the data-rich lab area into health systems, specialty hospitals, ambulatory service providers, and post acute care organizations seeking to compete and win in the new, value-based healthcare environment. In addition to delivering Frost & Sullivan We Accelerate Growth

6 best practices through its cloud-based platform, hc1 s client success team is composed of healthcare industry experts who quickly activate the solution to deliver an immediate positive impact and return on investment for the company s healthcare clients. Conclusion The hc1 Healthcare Relationship Cloud helps diagnostic labs and health systems to personalize the healthcare experience for patients and providers. By combining healthcare CRM, real-time analytics, and secure collaboration capabilities in a HIPAA-compliant environment, the company is able to meet the unique needs of healthcare organizations. With its strong overall performance, hc1.com has earned Frost & Sullivan s 2015 Product Leadership Award for the diagnostic laboratory CRM industry. Frost & Sullivan We Accelerate Growth

7 Significance of Product Leadership Ultimately, growth in any organization depends upon customers purchasing from your company, and then making the decision to return time and again. A comprehensive product line, filled with high-quality, value-driven options, is the key to building an engaged customer base. To achieve and maintain product excellence, an organization must strive to be best-in-class in three key areas: understanding demand, nurturing the brand, and differentiating from the competition. Understanding Product Leadership Demand forecasting, branding, and differentiation all play a critical role in finding growth opportunities for your product line. This three-fold focus, however, must be complemented by an equally rigorous focus on pursuing those opportunities to a best-in-class standard. Customer communications, customer feedback, pricing, and competitor actions must all be managed and monitored for ongoing success. If an organization can successfully parlay product excellence into positive business impact, increased market share will inevitably follow over time. Frost & Sullivan We Accelerate Growth

8 Key Benchmarking Criteria For the Product Leadership Award, Frost & Sullivan analysts independently evaluated two key factors Product Family Attributes and Business Impact according to the criteria identified below. Product Family Attributes Criterion 1: Match to Needs Criterion 2: Reliability and Quality Criterion 3: Product/Service Value Criterion 4: Positioning Criterion 5: Design Business Impact Criterion 1: Financial Performance Criterion 2: Customer Acquisition Criterion 3: Operational Efficiency Criterion 4: Growth Potential Criterion 5: Human Capital Best Practice Award Analysis for hc1.com Decision Support Scorecard To support its evaluation of best practices across multiple business performance categories, Frost & Sullivan employs a customized Decision Support Scorecard. This tool allows our research and consulting teams to objectively analyze performance, according to the key benchmarking criteria listed in the previous section, and to assign ratings on that basis. The tool follows a 10-point scale that allows for nuances in performance evaluation; ratings guidelines are illustrated below. RATINGS GUIDELINES The Decision Support Scorecard is organized by Product Family Attributes and Business Impact (i.e., the overarching categories for all 10 benchmarking criteria; the definitions for each criteria are provided beneath the scorecard). The research team confirms the veracity of this weighted scorecard through sensitivity analysis, which confirms that small changes to the ratings for a specific criterion do not lead to a significant change in the overall relative rankings of the companies. Frost & Sullivan We Accelerate Growth

9 The results of this analysis are shown below. To remain unbiased and to protect the interests of all organizations reviewed, we have chosen to refer to the other key players as Competitor 2 and Competitor 3. DECISION SUPPORT SCORECARD FOR PRODUCT LEADERSHIP AWARD Measurement of 1 10 (1 = poor; 10 = excellent) Product Leadership Product Family Attributes Business Impact Average Rating hc1.com Competitor Competitor Product Family Attributes Criterion 1: Match to Needs Requirement: Customer needs directly influence and inspire the design and positioning of the product family Criterion 2: Reliability and Quality Requirement: Products consistently meet or exceed customer expectations for performance and length of service Criterion 3: Product/Service Value Requirement: Products or services offer the best value for the price, compared to similar offerings in the market Criterion 4: Positioning Requirement: Products or services unique, unmet need that competitors cannot easily replicate or replace Criterion 5: Design Requirement: The product features an innovative design, enhancing both visual appeal and ease of use Business Impact Criterion 1: Financial Performance Requirement: Strong overall financial performance in terms of revenues, revenue growth, operating margin and other key financial metrics Criterion 2: Customer Acquisition Requirement: Product strength enables acquisition of new customers, even as it enhances retention of current customers Criterion 3: Operational Efficiency Requirement: Staff is able to perform assigned tasks productively, quickly, and to a high quality standard Frost & Sullivan We Accelerate Growth

10 Business Impact BEST PRACTICES RESEARCH Criterion 4: Growth Potential Requirements: Product quality strengthens brand, reinforces customer loyalty and enhances growth potential Criterion 5: Human Capital Requirement: Company culture is characterized by a strong commitment to product quality and customer impact, which in turn enhances employee morale and retention Decision Support Matrix Once all companies have been evaluated according to the Decision Support Scorecard, analysts can then position the candidates on the matrix shown below, enabling them to visualize which companies are truly breakthrough and which ones are not yet operating at best-in-class levels. DECISION SUPPORT MATRIX FOR PRODUCT LEADERSHIP AWARD High hc1.com Competitor 3 Competitor 2 Low Low Product Family Attributes High Frost & Sullivan We Accelerate Growth

11 The Intersection between 360-Degree Research and Best Practices Awards Research Methodology Frost & Sullivan s 360-degree research methodology represents the analytical rigor of our research process. It offers a 360-degree-view of industry challenges, trends, and issues by integrating all 7 of Frost & Sullivan's research methodologies. Too often, companies make important growth decisions based on a narrow understanding of their environment, leading to errors of both omission and commission. Successful growth strategies are founded on a thorough understanding of market, technical, economic, financial, customer, best practices, and demographic analyses. The integration of these research disciplines into the 360-degree research methodology provides an evaluation platform for benchmarking industry players and for identifying those performing at best-in-class levels. 360-DEGREE RESEARCH: SEEING ORDER IN THE CHAOS Frost & Sullivan We Accelerate Growth

12 Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best Practices Frost & Sullivan Awards follow a 10-step process to evaluate award candidates and assess their fit with select best practice criteria. The reputation and integrity of the Awards are based on close adherence to this process. STEP OBJECTIVE KEY ACTIVITIES OUTPUT 1 Monitor, target, and screen Identify award recipient candidates from around the globe Conduct in-depth industry research Identify emerging sectors Scan multiple geographies Pipeline of candidates who potentially meet all bestpractice criteria 2 Perform 360-degree research Perform comprehensive, 360-degree research on all candidates in the pipeline Interview thought leaders and industry practitioners Assess candidates fit with best-practice criteria Rank all candidates Matrix positioning all candidates performance relative to one another 3 Invite thought leadership in best practices Perform in-depth examination of all candidates Confirm best-practice criteria Examine eligibility of all candidates Identify any information gaps Detailed profiles of all ranked candidates 4 Initiate research director review Conduct an unbiased evaluation of all candidate profiles Brainstorm ranking options Invite multiple perspectives on candidates performance Update candidate profiles Final prioritization of all eligible candidates and companion best-practice positioning paper 5 Assemble panel of industry experts Present findings to an expert panel of industry thought leaders Share findings Strengthen cases for candidate eligibility Prioritize candidates Refined list of prioritized award candidates 6 Conduct global industry review Build consensus on award candidates eligibility Hold global team meeting to review all candidates Pressure-test fit with criteria Confirm inclusion of all eligible candidates Final list of eligible award candidates, representing success stories worldwide 7 Perform quality check Develop official award consideration materials Perform final performance benchmarking activities Write nominations Perform quality review High-quality, accurate, and creative presentation of nominees successes 8 Reconnect with panel of industry experts Finalize the selection of the best-practice award recipient Review analysis with panel Build consensus Select winner Decision on which company performs best against all best-practice criteria 9 Communicate recognition Inform award recipient of award recognition Present award to the CEO Inspire the organization for continued success Celebrate the recipient s performance Announcement of award and plan for how recipient can use the award to enhance the brand 10 Take strategic action Upon licensing, company may share award news with stakeholders and customers Coordinate media outreach Design a marketing plan Assess award s role in future strategic planning Widespread awareness of recipient s award status among investors, media personnel, and employees Frost & Sullivan We Accelerate Growth

13 About Frost & Sullivan Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best in class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best practice models to drive the generation, evaluation and implementation of powerful growth strategies. Frost & Sullivan leverages almost 50 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from 31 offices on six continents. To join our Growth Partnership, please visit Frost & Sullivan We Accelerate Growth

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