How Analytics Can Disrupt Work Comp

Analytics can be positioned as a profit center, transforming its visibility and perceived value to a workers' comp organization.

That the workers’ comp industry is uniquely slow in adopting analytics and applying the resulting intelligence to the operational process is generally known. The reasons vary, including natural resistance to new ways of working, fear of additional workload and cost-avoidance. Analytics may be misunderstood and is definitely undervalued. Notwithstanding amazing success with analytics by other industries, the workers’ comp industry remains disinclined to embrace it. Maybe the approach should be changed. To their credit, many payer organizations have created a position identifying analytics as a role in the organization. Titles include director of analytics, consultative analytics, claims analytics, VP of consultative analytics and analytics manager. Yet none of the titles suggest positions with authority. What will finally move industry leaders to value analytics as a legitimate and effective business initiative? Stated differently, how can analytics be made a disrupter in a workers’ comp organization, pushing though the resistance to create superior performance? See also: 10 Trends on Big Data, Advanced Analytics   Analytics as a disrupter One approach is to make it a profit center where analytics leadership is responsible and accountable for demonstrated savings and profitability in partnership with specific business units in the organization. Now the focus is on how the organization’s analytics-informed intelligence drives operational excellence and profitability! Senior management attention and support is quickly engaged. Analytics positioned as a profit center significantly transforms its visibility and perceived value to the organization. Of course, several factors must also come into play to achieve this level of analytic empowerment. First, the analytics leadership is made responsible for executing the analytics. It is also responsible for connecting the resulting intelligence to operations where appropriate actions are taken, mobilizing superior performance. This is best accomplished by means of establishing partnerships between analytics and specific operational business units. Analytics partnership Analytics value is actualized at the business unit level where daily decisions are made and action is taken affecting the operational process, clients, the service product and the organization. Analytic leadership partners with select business units where intelligence is transferred to action. That means systems are designed for easy access, easy use and decision support at the operational level. Initiatives are smart, digital and engaging for all participants. Design Connecting analytic intelligence to action depends on creative system design. The design for each business unit is unique, depending on the unit’s activity, requirements and goals. First, predictive analytics methods are used to analyze historic data related to the unit and the organization, thereby acquiring the intelligence that will be transferred in the form of decision support and guiding action. A major benefit of this approach is structuring and standardizing superior decision support and guidance for specific conditions and situations that occur. Organizational protocol is established and enforced while front-line professionals gain a personal knowledge assistant. See also: 3 Key Steps for Predictive Analytics   Measure As with any business initiative, measuring its effect on the organization is crucial. Moreover, the analytics-business unit partnership must be made accountable through performance measurement. Measure the value gained by repositioning analytics leadership to ensure that accountability is accurately allocated. The bottom line goal of positioning analytics as a disrupter is streamlining operational flow and increasing profitability, which can be measured in multiple ways. Measuring overall profitability related to the initiative is the first imperative. Moreover, profitability can be further apportioned in terms of increased revenue, productivity, accuracy, efficiency, timeliness, quality, return on investment, improved claim outcomes and strategic competitive advantage. The value is sustained by continually repeating the plan and measuring outcomes, always remembering the best outcomes are optimized by connecting analytic intelligence to action.

Karen Wolfe

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Karen Wolfe

Karen Wolfe is founder, president and CEO of MedMetrics. She has been working in software design, development, data management and analysis specifically for the workers' compensation industry for nearly 25 years. Wolfe's background in healthcare, combined with her business and technology acumen, has resulted in unique expertise.


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