Wednesday, March 28, 2007

Well-Seasoned Consultants: Caveat Emptor – Buyer Beware


Picking a “Well Seasoned Consultant” May be More Dangerous than “Eating Beef Jerky”

This month our firm celebrates its third anniversary. We have had a lot of fun, grown rapidly, made a few mistakes and have enjoyed remarkable success.

It is always risky commenting on the consulting skill of other firms. So, at the outset I should disclose that we have several dozen consulting partner firms from whom we have benefited greatly from their instructiveness, sound leadership and commanding knowledge. They are often in a position to offer expertise that is not within the spectrum of services offered by American Healthcare Solutions. Further, we have enormous respect for many of our competitors with whom we have no relationship. There probably has never been a deeper and richer pool of consulting talent in the healthcare industry.

We do, however, still bump into consulting firms that bill themselves as “well-seasoned.” This term of art is often a euphemism for tired and old approaches to solving new problems in healthcare. “Well-seasoned” is, however, a nicer term than “old goat.” “Old” today is less related to the age of the consultant than is the freshness of thought within their minds and hearts.

Originally used to describe food, “well-seasoned” draws my attention to “beef jerky” and “Virginia ham.” Both are rather expensive, loaded with more chemicals than a waste disposal system and heavily laden with fat and salt. The routine consumption of these food items is not generally considered good for your health; directly related to hypertension, as a minimum.

One should look carefully at the ingredients of a “well-seasoned” consultant; the following characteristics are bad signs:

• If your consultant thinks advanced computer skill is in some way related to e-mail . . . you may have a “well seasoned” consultant.

• If your consultant gets glassy eyes when you request a multi-variant predictive algorithm utilized in productivity management . . . you may have a “well seasoned” consultant.

• If your consultant thinks supply chain management is picking the right GPO . . . you may have a “well-seasoned” consultant.

• If your consultant cannot tell you every link in the revenue cycle from the doctor scheduling the operating room from his office to the investment of cash receipts from net patient care . . . . you may have a “well-seasoned” consultant.

• If the pictures of the consultants on their website (if they have one) looks like the bulletin board introduction photos of clients in a local nursing home . . . you may have “well-seasoned” consultants.

• Seriously, while there are endless lists of indicators, if you open the invoice from your consultant and the dollars charged take your breath away . . . you may have a “well-seasoned” consultant. Stated somewhat alternatively, if the invoice challenges your “gut” regarding the value received for the dollars charged . . . you may have a “well-seasoned” consultant.

As a practical matter, a consultant should only be retained against the same criteria generally utilized for hiring a new member of an executive team:

1. They can do something you do not have time to do.

2. They offer expertise that is needed and otherwise unavailable within the organization.

It is this latter category of consulting where “well-seasoned” consultants tend to struggle. The “well-seasoned” consultant that has skills garnered in the 1970’s or 1980’s is frequently missing an entire body of knowledge that has emerged in healthcare administration in the last generation. Certainly experience is an important factor in selecting a consulting firm but is the firm at the cutting edge of quantitative and qualitative analytical technologies and knowledge?

The best “well-seasoned” consultant I know is a fellow in his mid 70’s by the name of Paul Long. He is semi-retired, was a senior leader in the former Hunter Group and has an extraordinary pedigree of finance related accomplishments in some of the best hospitals in the United States. He stays current with the latest developments in healthcare administration and healthcare finance, in particular, and has penetrating judgment and integrity. His conclusions are based on deep data analysis, a balance of competing forces within an organization, and a commitment to deliver value to the client. We wish we could secure his services on a full-time basis. I do not have his permission to use his name in this missive . . . so I am likely to take a finger-wagging for telling the truth about him.

We also see young people coming into the field with remarkable skills and abilities typically over the pay grade of the generally available “well-seasoned” consultant. These young people own the future of healthcare consulting. Integrating their knowledge and analytical skill with more senior, but competent, talent is the trick for obtaining best value in healthcare consulting.

So, there you have it. When you retain a healthcare consultant, be careful. These dollars should be spent judicially. If your consultant cannot exceed your expectations and raise the performance bar for your organization, you may have purchased the “beef jerky” and “Virginia ham” of healthcare consulting . . . well-seasoned. On the one hand your feet should not swell, but your blood pressure may rise.

Jan Jennings

Republished with permission from the Hospital News Group