by Juliya Semenova and Mike Edwin

In a previous article, “Who’s Your Competition?.”, we discussed the importance of performing a market assessment in order to keep abreast of changes and ensure organizational success. In this article, we will focus on how to carry out this endeavor successfully.

The underlying premise of any competitor analysis is the ability to collect and to interpret data.  An organization has several options for obtaining market information.

Primary Research

Primary research utilizes tried-and-true approaches to gain information about your competitors.

There are multiple approaches you can take.

• Phone surveys – highly effective approach; expensive; statistically reliable
• Written mail surveys – moderately effective approach; self-selected sampling which is not statistically reliable
• Web-based surveys – moderately effective approach; self-elected sampling still applies
• Focus groups – effective approach once the idea or plan is solidified; good for getting direct customer feedback on ideas, plans, projects, etc.
• Field tests and observation – first-hand human observations on clients, customers, competitors, others

The effectiveness of your competitor assessment is going to depend on how successful you are in obtaining the information that you need, while overcoming the barriers to data collection. For example, very few organizations would jump at the opportunity to conduct expensive and time-consuming phone interviews and focus groups. However, getting real-time and reliable data can be done relatively easily utilizing what is already available in most health care organizations.

Human Network

One of the easier strategies to obtain the feedback is to utilize your human intelligence network. The reality is that the health care workforce in most markets contains individuals who frequently work and interact with multiple organizations (and likely your competitors).  Think of all the agency staff, moonlighters, physicians with multiple privileges, newly hired employees, peer networks of managers, and their acquaintances as untapped sources of inside information on your competitors’ plans.

So, how do you capitalize on this network? Simple strategies such as adding a couple of questions to the already available surveys, talking to interview/focus groups, and developing personal rapport with your employees may potentially tip you off to critical information on competitor plans.  Imagine adding just a couple open-ended, probing questions to patient satisfaction surveys or to conversations with your physicians and employees, such as “Which facility locally do you feel makes it easier for you to do your job?” or “Are there any improvements and facility projects that are underway at local health care organizations that you feel are especially beneficial or important to you?”. In return, you may get invaluable details regarding your competitors’ staffing skills, staffing ratios, clinical technologies, and efficiency initiatives. 

What about utilizing your internal sales/recruitment workforce and human resources? Oftentimes internal and external health care recruitment is focused on unidirectional flow of information, simply advertising the benefits of working at your organization. Obtaining feedback from perspective employees on what they value in an organization—and more importantly, what things they appreciated while working at other health care organizations—maybe critical to your planning efforts.

Most importantly, depending on your organization’s capital availability and internal resources, you may not be able to conduct extensive and statistically significant research studies in order to obtain definitive market trends, but using the aforementioned inexpensive and creative ways will still put you ahead of the curve in terms of strategic planning.

Secondary Research

A second method of data collection is the utilization of secondary research: gathering information through literature, publications, broadcast media, etc.

Secondary research methods tend to be pretty common and inexpensive ways for health care organizations to obtain data.

There are a multitude of sources that are readily available to your organization:

• State data (where available) is often a very easy way to assess your competitor volumes and physician/patient/procedure information
• Medicare data may also be a supplementary resource to your competitor analysis (Medicare Provider Analysis and Review Data Set, Hospital Outpatient Prospective Payment System Data Set, and Medicare and Medicaid cost reports, American Hospital Directory)
• Data obtained from vendors
• Sources of incidence data (American Heart Association, Dartmouth Atlas of Health Care, National Program of Cancer Registries, etc.)
• Certificate of Need fillings – description of proposed services, volume and demand forecasts, facility characteristics, project finances, and project timelines
• Bond rating agency reports –applications include performance on key financial and operational metrics, strength of the management team, noteworthy strategic initiatives, and likely impact on market conditions
• State health department data and reports
• Planning commissions – information on major renovations, extensions, and new buildings (square footage, number of beds planned, staffing requirements, proposed use of space, and floor plans)
• Hiring data from postings in clinical journals, Web postings, and physician recruitment/placement firms
• Media – articles in the local newspapers, the Internet, and televised stories on major competitor developments/strategies
• Quality reporting institutions (Leap Frog reports, state reports/scorecards, etc.)
• State price reporting information (for example, the Minnesota Hospital Price Check)
• Trade magazines, publications
• Census Bureau, Workforce Development, Housing Authorities, Commission on Aging, Department of Health, Health and Family Services, other agencies
• Web pages, publications, manuals, text books, etc.

This breadth of resources is invaluable for data collection; however, one must also be careful not to fall into some common traps of incomplete or inaccurate information. It’s important to be critical in your data analysis and interpret trends within the larger context of your market.

Of course, of most benefit is the ability to critically interpret the data and to successfully integrate the findings into a strategic planning process. Now that you are armed with “a point of reference” and have a better idea of your organizational strengths and shortcomings, you are better equipped to make decisions about pricing, existing and future services, staffing, and future strategic initiatives.

Juliya Semonova is a senior consultant in Wipfli’s health care practice. Juliya assists health care clients in the areas of business service and program planning, performance management, and business process design and analysis, among others. Juliya can be reached at 414.431.9387 or jsemenova@wipfli.com.

Mike Edwin is a senior consultant in Wipfli’s health care practice.  He specializes in community and facility assessments, market research data collection and analysis, and strategic planning for long-term care services and providers. Mike can be reached at 608.274.1980 or medwin@wipfli.com.