Charleston Area Medical Center 'Smart-Sizes' Using Kronos^® for Healthcare

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Charleston Area Medical Center is the largest hospital in West Virginia, serving more than 31,000 inpatients and 500,000 outpatients per year. With substantial patient volume and a staff of 5,500 employees, controlling labor costs had become a primary concern for CAMC's management.

"Our annual payroll including benefits eclipses $200 million per year and consumes 60 percent of our operating expenses," explains George Farris, director of management engineering. "It was becoming quite evident that a medical center of our size could not continue to manage labor resources the way we had been accustomed."

Driven by a number of factors, including operational process changes, an infusion of new technology, and constricting reimbursement, CAMC made the decision to institute a system for workforce management. “We needed a system that could provide the information needed to support labor decisions and assist in smart-sizing our organization.” The answer? Kronos’ workforce intelligence solution, which helped CAMC dramatically reduce its labor costs and increase workforce productivity.

‘Smart-sizing’: Utilizing staff effectively

Farris describes smart-sizing as the ability to have the right staffing at the right time and to make the best use of the hospital's most valuable and expensive resource: its employees.

"Kronos' workforce intelligence solution has been instrumental in achieving our labor cost-controlling objectives," says Farris. "This year we were able to use it to smart-size our organization in response to declining patient volumes. We identified and eliminated 154 positions from the staff budgeting process.

And that’s not all. Kronos also gave CAMC better visibility into agency utilization. This led to the most important benefit, in Farris’ opinion: “We succeeded in reducing agency costs from a monthly high of $208,880 to a three-year monthly low of $23,590.”

High-quality information = Better visibility and control

Kronos’ workforce intelligence solution enables managers at CAMC to accomplish a host of important goals: drill down information. Isolate workforce performance variables. And understand what factors are affecting productivity at any given time.

Another big benefit is managers’ new visibility into labor variances. With the software’s management exception desktop feature, managers can identify potential trouble spots and make proactive, timely decisions. And they are able to accomplish all this while meeting their productivity goals.

“We wanted our system to emphasize productivity and be hardwired into the day-to-day operations of the medical center,” explains Farris. Now with its high-quality information and credible data feeds, the medical center is in a much better position to track its volume of agency utilization and develop labor standards.

Crucial to the success of rolling out CAMC’s workforce intelligence solution: instilling ownership at the department level. Through manager workshops, Farris’ team validated a comprehensive list of core data elements required by its workforce management strategy. Managers were educated on 11,000 labor standards that were identified, what the specific data criteria meant, and how to interpret reports.

Explains Farris, “The workshops were key because, on top of educating managers and executives on the process, they helped reiterate the benefits of the program and keep everyone on board.”

Workforce intelligence: A way of life at CAMC

CAMC recognized that a focused effort in three areas was key to effectively managing its labor resources.

First: CAMC needed a mechanism by which it could capture changes to data elements in a timely manner. A process was developed to ensure that any department or manager responsible for a data element could post changes to a website. People who rely on that data element are automatically emailed about the change. As a result, the hospital remains confident that all reporting systems are synchronized.

Second: CAMC needed confidence that once the program was completed, it would be able to maintain its momentum. Productivity measures were added to managers’ annual goals and performance reviews. This helped ensure that productivity and performance would remain linked to the budgeting process. And the measures made certain that managers would make use of the workforce management resources provided to facilitate their own success.

And third: CAMC established an ongoing educational process. Kronos’ professional services team helped to train key individuals within the medical center. Their mission: Assist department managers with such issues as effective scheduling and controlling overtime. Farris’ team wanted to ensure the workforce management system’s ability to add value.

“It’s not enough to provide the departments with data,” says Farris. “You need to make sure they understand how to use it and incorporate it into their everyday operational processes.”

Timely, accurate data yields real results

Despite a sophisticated workforce management strategy, Farris says success would not have been possible without CAMC’s Kronos solution. “We didn’t want to just provide our managers with productivity statistics. We wanted to be able to provide them with detailed, enhanced reports that would help them make better and more timely workforce management decisions. We got that and more with Kronos.”

As a result, says Farris, Kronos’ workforce intelligence has become a way of life at CAMC. “Since we introduced it to the organization, we have seen dramatic results,” he comments.

“What’s most refreshing is that we no longer find ourselves conducting arbitrary, reactionary, across-the-board workforce reductions,” Farris explains. “Rather, we are using timely, accurate data to guide our decisions. And this is especially important in an industry like ours that is fraught with financial challenges.”