Process changes in service delivery

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Process changes in service delivery

Impact of healthcare cost reductions

Master Thesis in Technology and Operations Management

University of Groningen

Supervisor: Prof. dr. ir. J.C. (Hans) Wortmann

Co-Assessor: Anne Bonvanie-Lenferink, MSc

Company: OIM Orthopedie

Date: 20th_{July 2017}

Student: João P. G. Carvalho

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Acknowledgements

This master research thesis has been written as the final chapter of my Masters of Science program in Technology and Operations Management at the University of Groningen.

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Abstract

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List of Tables

Table 2.1. ServQual dimensions ... 9

Table 2.2. Summary of the 5 Gaps Model ... 10

Table 4.1. Summary of the Stakeholders, Activities and Goals ... 19

Table 4.2. Summary of the Quality Attributes and Critical Success Factors ... 21

Table 4.3. Concept and Process Changes Selection ... 33

Table 5.1. Forecast Revenue Model ... 37

List of Figures

Figure 2.1. Service Quality Framework to Gaps 2 and 3 ... 11

Figure 3.1. The Regulative Cycle phases of design science research ... 14

Figure 3.2. Problem-Based Ideation techniques ... 15

Figure 4.1. Relationships between the main stakeholders... 20

Figure 4.2. OIM Orthopedie General Service Protocol... 23

Figure 4.3. OIM Orthopedie Detailed Service Protocol ... 25

Figure 4.4. OIM Orthopedie Service Blueprint... 26

Figure 4.5. Possible General Service Protocol for Concept A ... 29

Figure 4.6. Possible General Service Protocol for Concept B ... 31

Figure 4.7. Possible General Service Protocol for Concept C ... 32

Figure 5.1. Final Design Solution of the General Service Protocol... 34

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1. Introduction

Modern healthcare is experiencing renewed challenges with an ever-growing aged population and a growing demand for quality of life. To combat this trend, national governments reforms are made to restructure their healthcare policies. These policy changes come in many ways, for instance within the European healthcare sector, increasing demand for care creates pressure on the government to reduce costs in mandatory insurance (Schäfer, Kroneman, Boerma, Van den Berg, Westert, Devillé and Van Ginneken 2010). In particular, such pressures are felt in the Dutch health care system, where insurance companies offer an equal and mandatory basic insurance policy regardless of age or state of health. If any treatment is deemed not crucial it will ultimately fall from that policy. In that case, an additional private insurance policy is necessary for the patient to avoid paying from their own pocket. Unlike the basic insurance policy, insurance companies are not obligated to accept the patient for private insurance (Schäfer et al. 2010). As a result of this legislation, some health services that were deemed fundamental to a debilitated patient and therefore fully backed financially will reverse to be dispensable. This will mean that services that depend on this type of finance will partially or fully stop being supported. Against these concerns, the most affected by this impact will be the businesses and most significantly the patient itself.

A central point and one of the major influences of this lack of financial support is that service providers will unbalance their perspective of patient and customer. This is not necessarily malicious as service providers will be prepared to introduce value and quality to the new service to make it optimally attractive to purchase. They seek to give them what they need before they know they want it and that leads to the challenge to transform how patients receive their treatment. Currently most service providers seem to be unprepared (Glowik, Smyczek 2015) in face of healthcare cost reductions as it leads to a high uncertainty of which processes should be changed to accommodate it.

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7 however OIM Orthopedie still retains more than half of the market share. Previous to acquiring this product the patient requires a diagnosis, thus a medical prescription from a general practitioner that recommends an elastic-nature equipment to help with their medical problem. These compression stockings currently fall under the basic insurance policy in the Netherlands therefore the product and the service necessary to measure the stockings according to the patient legs are fully financed by the insurance company.

Due to unforeseen changes, there is concern that the government will try to minimize the finance needed for the mandatory basic policy, and take the stockings out. If so it becomes a problem for the OIM Orthopedie business model. If they can no longer rely on the insurance companies to provide financial support for the compression stockings they must seek ways to still get revenue for their business to continue to offer the service. One of OIM Orthopedie main activities is the presence of advisers that are taken by appointment for the fit, adjustment or pick up of their compression stockings. In the act of purchase, the company does not only offer a product but also a responsibility to the patient to supply assistance in treating their need. It is important to research if practical problems rise within the organisation on their current way of delivering the service.

An unwillingness to adaptcan lead to the loss of customers due to attachment to their traditional practices. In general, service providers like OIM Orthopedie seek to increase customer loyalty and therefore patient satisfaction in order to ensure sustainable competitive advantage (Glowik, Smyczek 2015). Promotion of advanced and clear practice will remain vital to continue to deliver quality access to care while maintaining cost-effectiveness. It is also important to see how process changes can affect the subsequent role and tasks of these healthcare providers and how change is done within a new service delivery system. Therefore there is a need for a master student assignment to assist healthcare service professionals responsible for the management of their health services, in enabling them to comprehend how a customer views a value of a service. This will also assist the business in offering a more attractive business model to sell their compression stockings to people who need it.

1.1. Research Questions

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8 studying the current delivery system and identify what changes can be made to sustain or improve the processes assisted in formulating following research question and sub-questions:

Research Question: How to design a successful delivery system for healthcare services that will soon

lack financial support?

a) Who are the main stakeholders in the service delivery?

b) What are the most relevant attributes and critical success factors (CSFs)?

c) How to develop concepts and process changes for a new service delivery system?

To assist in answering these questions, the next chapter furthers the theoretical research in the evaluation of the quality of health services and the use of business process modelling language. The third section covers the methodology that will be utilized; while later chapters cover the results and subsequent discussion and conclusion.

2. Theoretical Framework

Finding appropriate literature regarding the case was difficult as not so many academic articles or case studies go deeply into the general impacts of healthcare cost reductions into processes or service. Therefore this section aims to cover relevant theory on service quality, design science and business process modelling in the context of healthcare providers which will be utilized throughout the thesis and are relevant to answer the research questions.

2.1. Service Quality

Service has always been hard to define as many scholars propose different definitions to it. Kotler and Keller (2007) defined service as “any activity or benefit that one party can offer to another

which is essentially intangible”. Even so, services often come with product. Services are mainly

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9 context. Parasuraman et al. further refined SERVQUAL in later years (1988, 1991, 2005) offering an advanced model for measuring service quality which involves five main dimensions as seen in Table 2.1.

Table 2.1 ServQual dimensions of Parasuraman et al. (Adapted from Marshal G, Murdoch L., 2001)

Original Model (1985)

Refined Model (1988)

Description

Tangibility Tangibles Physical aspects of what is provided to users.

Reliability Reliability The ability to accurately accomplish what was promised Responsiveness Responsiveness

Ability to help users and promptly provide the service, capturing the notion of flexibility and the ability to adjust the service to the users’ needs.

Competence Courtesy Credibility

Safety

Assurance Competence and courtesy extended to users and safety provided through operations.

Access Communication

Understanding

Empathy Individual attention provided to users.

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Table 2.2 Summary of the 5 Gaps Model of Parasuraman et al. (1985)

Gaps Problem Description

Gap 1 Difference between customers’ expectations and management perceptions

The management or service provider does not know the customer needs. A lack of knowledge and unclear perception about customer expectations.

Gap 2 Difference between

management perceptions and service specifications

The management or service provider might perceive the customer needs, but does not have a defined performance standard.

Gap 3 Difference between service specifications and service delivery

The service personnel fails to efficiently meet the specified service quality thus not delivering to performance standards.

Gap 4 Difference between service delivery and external communication

The service personnel have the right skills to deliver the specified service quality but customer is left unsatisfied due to external factors.

Gap 5 Discrepancy between customer expectations and their

perceptions of the service delivery

Relates to the gap between what the customers expect from the service and what they think they have received, thus misinterpreting the service quality.

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11 figure 2.1 summarizes the relevant service quality gaps, their contributing factors and dimensions.

Figure 2.1 Service Quality Framework to Gaps 2 and 3 (Adapted from Parasuraman et al., 1985, Zeithaml et al., 1990 and Frost & Kumar, 2000)

There is a shortage of necessary resources to satisfy the customer to narrow down those gaps. Frost and Kumar (2000) reinforce the willingness of management to better define their quality specifications in order to meet an optimal service delivery. Grönroos (1990) adds that the gap between perceptions and service quality is mainly due to insufficient planning, lack of procedures, no set goals and insufficient support by management. For a successful service transition, organizations require sufficient knowledge to successfully implement changes in their business strategies (Kindström and Kowalkowski, 2009). This master’s assignment aims to reinforce awareness to these critical problems and to add an example to that pool of knowledge. The use of a case study at OIM Orthopedie will convey an in-depth understanding of managerial problems that reveal which relevant processes lie underneath and discern which changes are needed to solve them. If management lacks to perceive the customer needs, service quality will not be met and therefore the organization will be unable to sustain a competitive advantage. Therefore, adding to the practical research question formulated beforehand of how to design a successful service delivery system, there is also a theoretical importance of how to translate management perceptions into service quality specifications and how to efficiently meet customer expectations in a service delivery system that lacks financial support in the context of delivering compression stockings and similar services.

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2.2. Business process modelling in Design Science

To further assist in redefining this service delivery system, design science research is often seen as a natural approach of analysing the problem at hand, designing a solution and developing it further through testing (Van Aken, Chandrasekaran and Halman 2016). It is also considered a human-centered and systematic problem-solving approach than emphasizes the deeply understanding of customers in order to better satisfy their requirements and the business goals as it aims to translate observation in insights and insights into innovation (Scherer, Kloeckner, Ribeiro, Pezzotta and Pirola 2016). This problem-solving approach by modelling was first started by the Object Management Group (OMG) in the 90’s with the “Model Driven Approach” (MDA). They derived some starting models which failed to its bad applicability. It was learned that the data being used is dependant of the context, as the most important part of the model is to create a satisfactory solution for the relevant stakeholders. For that three principles were devised. First, for the models to be precise they used Unified Modelling Language (UML) to model the processes with BPMN (Business Process Modelling Notation). A visual summary of the five basic BPMN elements can be found in Appendix A. Second, these models needed to be validated with the end-users so they were correct. Third, the models needed to be refined by using a systematic circle, also referred as the Regulative Cycle.

These researches fit this assignment as they were made in processes that already existed but needed optimization. As Drucker (1990) points out, major productivity breakthroughs in services, often come from redefining the process rather than finding faster or automatic ways to do it. With process optimization, new or significantly improved production or delivery methods can be implemented (Varkey et al. 2008). The customer does not usually pay directly for process, but the process is required to deliver a service and to manage the relationship with the various stakeholders (Varkey et al. 2008). The establishment of these new processes will define the new system to continue to provide excellent customer outcomes. Therefore there is an academic relevance of how to model the service delivery of compression stockings using a standard business process

modelling language and apply it to similar services. This will enable managers to have more

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3. Methodology

This section covers the methodology applied. First the research strategy is explained, with a focus on Design Science and the Regulative Cycle of van Strien (1997). Methods of case study are also explained to extract information from OIM Orthopedie and assist in mapping the protocols in BPMN Language. Additional methods of Problem-Ideation techniques, Concept Generation and Launch Conceptualization of Crawford and DeBenedetto (2010) are used to reinforce the practical robustness of the research in the real world and fit with the company’s overall business strategy.

3.1. Research strategy

Design Science research is utilized as the main research strategy, aimed at knowledge that can be used in an instrumental way to design and implement actions, processes or systems to achieve desired outcomes in practise (Van Aken et al. 2016). In OIM Orthopedie there is absence of tools and plans that can assist processes in better satisfying customer expectations facing lack of financial support (Grönroos, 1990). As stated by Van Aken et ak, (2016), the main goal of Design Science is to have utility therefore the objective of the design solution and ultimately the assignment is to support OIM Orthopedie in improving their processes and apply them to similar situations. Design is many-faceted so we also keep in mind, in all the phases, the type of design which is defined as Design-Driven Innovation to meet customer’s needs. Design-driven innovations push new meanings as the role of design turns to modify the service so it can accommodate the service characteristics (Verganti 2011).

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3.2. Design Science

To accomplish the objectives set, the Regulative Cycle of van Strien (1997) is utilized which consists of five phases, the identification of the design problem, the diagnosis and analysis, the design solution, the actual implementation and the validation as seen Figure 3.1. Actual implementation is not conducted however guidelines are given to management.

Figure 3.1 The Regulative Cycle phases of design science research (Adapted from van Strien, 1997)

3.2.1. Design Problem

In the Design Problem the context of the problem is studied. This research will employ a single case study design within OIM Orthopedie to empirically gain a better understanding of the complexities inherent in a healthcare delivery system. To identify the design problem an analysis of the current system is conducted to identify the main problems faced by the customer. To specify, Problem-Based ideation techniques are utilized, where the situation is studied with the use of several sources of information to identify the relevant problems (Crawford et al. 2010). The stakeholders need to be familiar enough with the service to provide meaningful data and that OIM Orthopedie. Information was drawn from internal records, direct inputs, problem analysis and scenario analysis as seen in Figure 3.2. These sources will enable to develop a general overview of the service to become possible to understand which processes should be looked into and will lead to a more robust identification of goals and problems.

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Figure 3.2. Problem-Based Ideation techniques (Adapted from Crawford et al. 2010).

3.2.2. Problem Analysis

After conducting a thorough research of finding stakeholders goals and problems, there will be a formulation of quality attributes to define a list of critical success factors of the service delivery system. This was carried out additionally with literature review and in the means of open interviews. Protocols for the current service will also be modelled using BPMN (Business Process Modelling Language). The choice of this language is motivated by the fact that it eases communication between the modeller and the business to help bridge the understanding gap (Balsters, 2016). Essentially these will be flowcharts where all tasks in the service delivery system will be considered and the sequence in which the tasks are executed as seen in Appendix A. Afterwards concepts will be generated from these critical success factors and quality attributes using methodology of Crawford et al. (2010).

3.2.3. Design Solution

The Design Solution phase involves designing a final utility-driven artefact. The focal point of the protocol will be done by observing the logic structure relating to the current service delivery system. A BPMN final model will be used as the output for the design phase of the system to design, control and manage processes in a new service. It will be derived from the current process at OIM Orthopedie and from each proposed concept and process change. Performance requirements define what the design artefact should do and how it should be done (Balsters, 2016). Therefore, the design solution can be checked whether the design meets all critical success factors of the stakeholders and quality attributes. The solution will be designed to meet as many critical success factors as possible.

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3.2.4. Implementation of the Design Solution

So far we have addressed three phase expansions for design problem, problem analysis, and design solution. Actual implementation of the design solution will need to be tested against the proposed subjective solution, which means it still needs to go through a number of iterations in order to become fully objective and functional. In order to do that, feedback from managers at OIM Orthopedie is required. Greater integration with end users will lead to better information about which design changes are required. As we cannot implement the solution due to heavy costs and time, this will only serve as guidance for a future restructure of the business therefore a financial forecast is conducted as a benchmark, a launch is conceptualized and scenario analysis is utilized to see the different situations it can be implemented on.

3.2.5. Validation of the Design Solution

Further validation of the design solution means confirming stakeholder goals and checking whether they were met. The design solution will be presented to the stakeholders to get critical feedback from the following discussion where other new factors can arise and be implemented in the design. The stakeholders have played a crucial part on the concept so they are supportive of it which could imply a challenge to improve the now-strong proposal (Crawford et al. 2010). Since our design solution is subjective, it can be expected that it would need to go through several iterations until it will satisfy all the requirements of the problem and provide value to all stakeholders. The design solution will be assessed continuously through the research. It will require evaluation through the whole research process at many different times and in different ways, by different people for different reasons.

3.3. Case Study Methods

The case study conducted at OIM Orthopedie permitted to gather all information about the business process flow and model it, with several techniques mentioned in problem ideation utilized to robust the modelling of the service processes. Open interviews and questionnaires were also conducted with the managers and professionals at OIM Orthopedie.

3.3.1. Problem-Ideation Techniques

Internal Records: Different sources of information were used to identify the problem. The

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17 understand which processes are and are not working. The system gathers large amounts of data and therefore the generated reports were reviewed for the most relevant data. From their website, strategic values were extracted, clear information about the whole process of delivery to delivery and afterwards, and delivery planning and responsibility to arrange the full administrative settlement with the health insurer.

Direct Inputs: The actual information can also be conveyed by the people who make decisions.

Most of them have spent plenty of time with their end users and are familiar to how their work processes work. Constant and direct contact with OIM staff and the patients lead to a more active search for their problems and needs. Due to the busy working nature of the stakeholders it was important to take continuous initiative, as several visits and emails exchanges lead to more refined protocols and blueprints. Suggestions and criticisms were always welcome as they are taken as important requests for new changes.

Observation Analysis: According to the service delivery system a set of problems associated

with it was gathered by observing the situation at hand, instead of asking directly. A full visit of an OIM local office permitted to study the entire system of delivery of the compression stockings. A shadowing of an adviser conducting the measurement service was taken place which can be found in Appendix C. This lead to the creation of the process models with BPMN language. Open conversations also took place in order to ask the end-users about the benefits they currently are getting and the benefits they want from a new service delivery system.

Scenario Analysis: The scenario analysis procedure involved painting a future state scenario of

what the business will look like in the future. For that we need to have a thorough knowledge of the current situation in order to envision a realistic future scenario. It is necessary to anticipate their problems in order to stay one step ahead, thus it is not viewed as a solution as it is only a source of future problems which need to be considered. This is used on the recommendation to management in order to account for future problems and therefore frame a strategic fit.

3.3.2. Open interviews

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18 conducted after shadowing the consultation process to ask questions about the modelling of the current services in OIM Orthopedie business protocol. The third interview was used to evaluate the process protocol, service blueprint to see if they have been correctly captured. The fourth interview presented new concepts and process changes with a discussion on the proposed design solution with the field experts’ personal opinion.

3.3.3. Questionnaire

In order to select the criteria for a new solution, a questionnaire has been devised based on the manager perceptions of the current process at OIM Orthopedie taken partially from the SERVQUAL instrument (Parasuraman, 1985). The actual questionnaire can be found in Appendix D. These statements were classified using a 7-point Likert-scale where a 7 meant that the individual strongly agreed OIM Orthopedie currently had that feature while a 1 meant they strongly disagreed. The unit of analysis on this questionnaire were individuals with knowledge of how the service works with a total of 5 professionals interviewed. A boundary of the study and a sample frame were also defined for the selection of these individuals. The boundary was established as the process of delivering compression stockings by OIM Orthopedie. With the sample frame, individuals were selected by following replication logic, based on professionals with experience in managing the service and experts who administer or have insight of the service, that match our sources of unit of analysis.

4. Results

Results have been drawn from the data collected from OIM Orthopedie in order to identify stakeholders, goals, quality attributes and critical success factors. Afterwards, information related to business processes was captured with two service protocols, one general and one detailed, and a service blueprint. The research process consisted in design and case study methods which this section goes into more detail. Finally, relevant concepts and processes changes are generated from this data and selected to derive the design solution.

4.1. Stakeholders and Goals

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19 with the patient during the delivery of the compression stockings. Next, the goals of each stakeholder were specified in order to formulate a wished state of the current situation. All the different perspectives of the stakeholders were considered and it was assessed that their common goal was a satisfied customer between all parties.

Table 4.1. Summary of the Stakeholders, Activities and Goals

Stakeholders Activities Goals

Patient Has a debilitating disease or another medical cause

that will make them customers to purchase the compression stocking.

A need for treatment.

General Practitioner

Diagnoses the problem which will be treated by the compression stocking. Can be found at a hospital, clinic or private office.

To diagnose the patient on the best treatment solution.

OIM Adviser A specialist that represents OIM Orthopedie in

administering the service, requiring certification by a recognized body.

Successfully assist the Patient with the compression stockings.

OIM Local

Office

A service firm consisting of different skilled professionals that serve different patients, with the assistance of clerical staff.

Wants to provide the best support to the customer and profit-efficiency.

OIM Call Centre Provides point of contact and technical support

throughout the process and is involved in assisting customers in booking their appointments.

Wants to provide the best support to the customer and local offices.

OIM Control

Centre

Deals with order-to-delivery of the compression stockings, generating orders with the data provided from the patients. Provides logistics supports to all OIM Local Offices.

Efficient frequency of service delivery and to resolve other complex technical and logistic issues.

BSN Factory Supplier of the compression stockings. Takes care

of the manufacturing and shipping of the compression stockings.

To supply the stockings as cost-efficient as possible.

Insurer The insurance company currently finances both

the consultation and the compression stockings.

Minimum reimbursement of the service.

Common goal: Satisfied customer

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20 Therefore the interactions between OIM Orthopedie and the patient were deemed to be the most crucial part of the patient receiving the compression stockings. Furthermore, an important part of producing the service comes from interactions not seen by customers in the operating core and back-office. The back-office consists of activities performed in direct support of the servers while the operating core is a set of central activities that provide indirect support of the services as well as harmonized management of all tasks. Thus OIM Orthopedie is split in four different stakeholders, represented by four different departments, to better understand the compression stockings process flow. Therefore this answers the first sub-research question of who are the main stakeholders where figure 4.1 summarizes the relationships and the interactions between the main stakeholders, the patient, the OIM Adviser, the OIM Local Office, OIM Call Centre and the OIM Control Centre .

Figure 4.1. The relationships between the main stakeholders of the service delivery

4.2. Quality Attributes and Critical Success Factors

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Table 4.2. Summary of the Critical Success Factors and Quality Attributes

Quality Attributes

Definition of Quality Attributes Critical Success

Factors

Main CSF

Reliability Trust and transparent communication of

the service. Improved Personal Quality Maximize Efficiency Modern Flexibility Produce superior value

Responsiveness Willingness to help and respond to

customer needs.

Assurance Handling of customer problems with

professionalism and respect for ethics.

Empathy Understanding and knowing of patients.

Tangibility Physical manifestations of the service.

The difficulties faced by companies in maintaining service quality are well known, as they seek to sustain their competitive advantage by offering superior value to the customer in face of service transition (Damali, Miller, Fredendall, Moore and Dye, 2016). Therefore this will lead the main success factor of producing superior value by constructing an attractive service to purchase. This is also defined by the ability that the clients will encounter what they need on the service. Additionally, the split into three critical success factors benefits in generating different protocols that ensure the main success factor is met. There is an order-dependency between the three main critical success factors in a way that personal quality, maximized efficiency and modern flexibility depend on each other before coming with an optimal solution. These will be used as the main drivers to derive concepts in order to achieve superior value and the common goal of a satisfied patient.

4.3. Service Protocol

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Procedure: The service can only start if there a willing of the patient to reach out and search for

help. This activates a personal need inside the patient to solve his or her problem. The patients who need the compression stockings suffer from a range of medical conditions. It is identified by the general practitioner whether in hospital, private office or clinic and is the first stakeholder to interact with the patient. The GP writes a prescription for the medical condition, which then refers the patient to a specialist or product, and in this case study to the requirement of an elastic product to pressure the blood flow in their legs. It is usually in this process that the Patient becomes aware of the service provided by OIM Orthopedie, however it can be known through interpersonal communications such as word-of-mouth, past experiences or marketing. For Patients who are already aware of the service and already have a medical prescription they can already call the service provider, through OIM Call Centre, to schedule an appointment.

After identifying the need for the Compression stockings, the customer makes the first call to OIM Call Centre to create an appointment for an adviser consultation. This will be the first service interaction with OIM Orthopedie. If the customer is mobile the appointment is booked in the most accessible office nearest to their location, however exceptions can be made for the adviser to travel to a personal home. Independent of location, the consultation is done the same way, since it does not require any special equipment however can have an impact on the patient’s perception on service quality. Patient profile and appointment information are shared through the same database by OIM departments/stakeholders.

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Whether the appointment is done at a personal home or at a local office, the consultation starts when both adviser and patient are prepared and present since it does not require any special measures or equipment. More information on the consultation procedure can also be found in Appendix C. The patient has to present his medical prescription and their problem situation to the adviser. A quick brief and rundown is also conducted by the Adviser if necessary. With new patients additional information is required and full measuring of the legs will occur. In the case of a repeat patient, it is assessed if the patient requires additional measuring for new stockings. The measuring process requires the patient to sit and uncover their legs. Conversation is done throughout to assess and ease the patient. Averagely six measures are taken but up to twelve measures can be done, if a longer or wider stocking is needed. After the measuring is conducted some final remarks are presented to the patient and the patient is then escorted out of the room. If the adviser has time between available sessions they need to input the patient data unto a tablet that connects directly to OIM’s database to process the data and generate the order for the required compression stockings. If the next patient is already waiting for them they need to proceed to that next appointment and input patient data whenever there is available time. That patient data is then analysed and processed in the same location by back office professionals and sent digitally to OIM’s Control Centre for Orders.

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4.4. Service Blueprint

To have a basis for the current and new process protocols a service blueprint has been created. This blueprint specifies the physical evidence, customer and staff actions, and support systems needed to deliver the service (Bitner, Ostrom & Morgan, 2008). It takes into account the relationship between the main stakeholders of the problem as seen in figure 4.1 and supports the protocols in accordance to the changes that occur on their service. While a business is viewed as a complex system of interconnected processes, the service blueprint is a high-level representation of these processes (Bitner et al., 2008).

Own Figure 4.4. OIM Orthopedie Service Blueprint

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27 visible to the patient. Receiving the call, scheduling an appointment, preparing sessions, input of information, analysis of the client data and consequent order generation. Supporting these are the business management software utilized by the service provider, manual sheets of information where the adviser writes patient information and measurements, the business tablet that is afterwards used to introduce that information to the database and general accounting and analysis software utilized by the back office.

4.5. Diagnosis/Analysis

In order to assist in generating concepts for a new design solution, a questionnaire has been derived with 24 statements regarding the current status at OIM Orthopedie, which can be found in Appendix D where more detailed information can also be found in the previous section 3.3. Due to limitations of the questionnaire output it has been deemed as a trial. The lack of respondents, a number of five, did not permit to draw relevant statistics. For the actual quantitative research the number of respondents should be at least a couple of dozens. For instance, the results could be analysed if a sample of e.g. 50 respondents would have been collected, as it could show if Tangibles fared more importantly than the Responsiveness attribute in order to generate more relevant process changes.

Therefore for the analysis, critical success factors were deconstructed into concepts, where process changes were derived from the trial information taken from the questionnaire, the open interviews and observing inefficiencies on the current process. This does not accurately reflect the actual perceptions of which processes need to be changed however it is utilized to meet the most critical success factors possible to ensure it offers superior value and have a more robust design solution. Three different main concepts and eleven process changes were generated which were tested and evaluated afterwards by managers for the most relevant process changes.

4.5.1. Concept A – Revamp Processes for Personal Quality

Number of process changes: 4

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28 personal quality, taking into account a better understanding of the customers to be able to offer more individual attention.

Process change 1: Improve the design of facilities, equipment and others

Appearance of physical facilities, staff uniforms and equipment plays a crucial part on how the customer perceives the service (Edvardsson 1998). The physical facilities and equipment were found to be in the most need of improvement through observation analysis, direct inputs, the questionnaire and open interviews. Flyers, pamphlets can be designed to the customer and made more attractive. These interactions with the physical evidence may determine whether the customer comes or not again. As the client receives the order, the design of the box and the information contained on it can also be considered which will make a lasting impact on the usage of the compression stockings.

Process change 2: Facilitate understanding with courtesy

Greeting and conversing with the patient is done with sympathy and courtesy, thus an opportunity for planned greetings and questions would make the staff more prepared for customer interactions. From internal records there has been a survey where the customer satisfaction was ranked 8.1 from 10 which implies the company is in good track. Additional training and education will permit the staff to handle patient problems with increased professionalism and knowledge. It was also found through observation analysis that communication flows only through Dutch. It is also important to communicate in an understandable language in order to reach speech-impaired, blind and even foreign patients. Treating him or her as a fully-fledged client is the key to his or her empowerment, and thus, ultimately, to customer satisfaction.

Process change 3: Allow online scheduling and delivery

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29 payment process and directly store the data in their system for future visits. Advisers can now process more of the customer’s information directly into the system.

Process change 4: Improve availability and spreading of information

Availability of information will be crucial in the new process as this correlates with the previous process change as with increasingly shared databases between all stakeholders it will permit better availability of patient data for better understanding and knowing of patients. Patients will also need to be correctly informed of changes. Increasing the access to information can be done through marketing, bigger online presence, informational flyers, word-of-mouth or other interpersonal communications. Finally, by developing community partnerships the company can also increase their reputation and image awareness.

Own Figure 4.5. Possible General Service Protocol for Concept A

4.5.2. Concept B – Maximize the Efficiency of Processes

In a business process change, management often looks for time and cost savings over any other consideration to make a process more efficient (Harvey et al. 2011). However this type of trade-off can lead to an incorrect selection of new processes to modify based on profit. What is needed is a better perspective of balancing productivity gains against the more important way of delivering value to the customer.

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30 To have a reliable service makes the patient feel comfortable and avoid any stigma. In order to solve the need for treatment, the patient will seek relief of their pain so it is important to assist the patient in maintaining a natural state of health. It should be efficient in responsiveness to act fast and accurately in face of patient problems. The patient also seeks to avoid any feelings of embarrassment referring to their condition. This relies on trusting the service, thus the adviser on making him feel comfortable and even produce some feelings of empowerment and motivation. It was found that trust already possesses a high level of trust through observation analysis and open interviews.

Process change 6: Reduce waiting times for appointment and delivery

This process change is defined by the waiting time between when the patient first calls OIM Orthopedie and the appointment date, the waiting time during the local office before they are attended by an adviser, and the waiting time for the compression stockings to be delivered. It was found through observation analysis that it is not necessary to reduce further the consultation time. Some tasks such as filtering the data, data analysis and order generation that are handled by different staff can be combined that directly affect the waiting time for delivery. Relaying the responsibility of shipping to another third party can also be considered.

Process change 7: Streamline and optimize customer service

A big offering of any service is their customer service operations. Consolidating customer service measures will enable to provide a more tailored service to the patient. In order to further optimize there is the ability to offer more customer service options such as 24/7, live chat and personal contact with adviser. Another possibility would be to let the patient schedule their appointment directly in the local office or again through online.

Process change 8: Have a clear returns and exchange policy

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Own Figure 4.6. Possible General Service Protocol for Concept B

4.5.3. Concept C – Offer Modern Flexible Changes

As the customer pays for the service, the value that comes from the service is expected to increase. With the implementation of modern and flexible processes it also gives the choice to the patient of what certain areas of the service he or she can choose to enjoy. To offer choice to the patient will inevitably lead to a decision that he or she is most comfortable with.

Process change 9: Next-day and flexible dates for appointment or delivery

Similarly related to process change 6, the offering of flexible dates will permit the patient to tailor their time to when is most accessible to the patient. Next-day appointments or delivery can be established with a premium in case of any urgency by the patient to get the process done as quickly as possible. Tracking of the order of the compression stockings can also be included.

Process change 10: Offer a bigger variety of add-on products and services

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32 while waiting for their own. Additional communication services for home assistance can be offered facilitating the correct usage of the compression stockings.

Process change 11: Emphasis on home visits and consultations

A big turn point of the service is no longer relying on tangibles to offer quality to the patient. The advisers are board certified practitioners which are not dependant of any sophisticated diagnostic technology relying mostly on their training and experience to conduct their measurements. By visiting the patient at home he or she no longer boasts the experience of having their consultation on OIM’s local office. Through direct inputs it was found that there already competitors who exclusively compete with home consultations. It also found through internal records that home visitations currently play a small part on their business and it takes a higher cost to pay the adviser to travel to the customer’s home. Even so, one must consider that there would be no longer any costs associated with additional staff and tangibles.

Own Figure 4.7. Possible General Service Protocol for Concept C

4.6. Concept Selection

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Table 4.3. Concept and Process Changes Selection

Process Changes Selection or

Rejection

Reason

PC1: Improve the design of facilities, equipment and others

Selected Value improvement on tangibles and assurance

PC2: Facilitate understanding with courtesy Rejected Already high level on current process

PC3: Allow online scheduling and delivery Selected Value improvement on reliability and

responsiveness

PC4: Improve availability and spreading of information

Selected Key change for service transition

PC5: Make the process reliable Rejected Already high level on current process

PC6: Reduce waiting times for appointment and delivery

Rejected Already high level on current process

PC7: Streamline and optimize customer service Selected Value improvement on assurance,

reliability and responsiveness

PC8: Have a clear returns and exchange policy Selected Value improvement on assurance,

reliability and responsiveness

PC9: Next-day and flexible dates for appointment or delivery

Rejected High level on current process

PC10: Offer a bigger variety of add-on products and services

Selected Value improvement on tangibles and empathy

PC11: Emphasis on home visits and consultations Rejected Not in line with strategic fit

5. Discussion

5.1. Design Solution

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Two new added processes include the online scheduling, offering as an additional option with the telephone system with consequent online payment, and also the returns/refund process when the customer receives their order. These are seamlessly inserted into the process flow without removing any previous processes but will involve staff role assignment and additional planning investment to implement. One process optimization occurred with streamlining and optimizing customer service meaning that the previous telephone system and role of OIM Call Centre will now involve a more general availability of support and can offer additional options such as 24/7 support and live chat. Two new decision gateways have been added for the online payment of the compression stockings and return procedure. Three text boxes, represented in red, have been added to offer additional information about the process without adding or changing the process, with marketing, webshop and additional services. These will supplement the processes with value, by implementing a more availability and spreading of information and offering a bigger variety of add-ons products and services. Due to uncertainty of a full or partial stop of financial support, the insurer has been removed from the design solution.

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36 facilitate the new service. The wording of the processes was as generalized as possible, instead of more effective, to also apply it to other solutions.

5.2. Design Validation

The design solution has been continuously evaluated throughout the research through direct inputs and validated according to the most relevant aspects identified for a future new service in open interviews. Unfinished models and protocols that lead to it were also shown and assessed to collect more information. If the stakeholders saw any error on the protocols, follow up questions were made to improve on the model which allowed for an easier updating. Another way of validation is that the solution aimed to meet most of the critical success factors possible which is confirmed by stakeholders in the final interview. These are improved personal quality, efficiency and flexibility in order to offer superior value. Due to lack of time no more validation was conducted. The precision of the promised process changes will only hold true after further strategic and tactical analysis.

5.3. Recommendation to management

Some relevant scenarios will be discussed which may affect the design solution. Two main scenarios were found that would relate to the development and execution of the finance of the design solution:

a) The insurers will partly finance the service and the compression stockings b) The compression stockings will no longer require medical prescription.

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37 The cost feasibility of the design solution is done through a financial analysis as seen in table 5.1. Due to lack of financial data and no access to real numbers it is difficult to project a proper sales forecast for OIM Orthopedie. An application of real numbers by the company will help clarify if they will increase their revenues or market share with or without the new design. This base case takes into account the implications of the new service and presents itself as a probable example of how to calculate expected revenue. The simple formula is given with:

Table 5.1. Forecast Revenue Model Example

Forecast Revenue Model Year 1 Year 2 Year 3

Market Size 100,000 102,200 104,448

Market Share % 60% 62% 65%

Market Share 60,000 63,364 67,891

Market Size for Stockings 15,000 15,841 16,973

Expected Value/Sales 3,900,000 4,118,660 4,412,928

Operating % 80% 78% 75%

Operating Costs 3,120,000 3,212,554 3,309,696

Gross Revenue 780,000 906,105 1,103,232

Implement website 60,000 8,200 8,200

Implement returns and refunds 42,000 16,000 16,000

Facilities makeover 1,100,000 0 0

Additional inventory 200,000 40,000 40,000

Marketing costs 60,000 40,000 40,000

Dedicated staff salaries 405,000 405,000 405,000

Training costs 80,000 50,000 40,000

Total Implementation Costs 1,947,000 559,200 549,200

Revenue -1,167,000 346,905 554,032

In this base case, values were derived from multiple sources from Crawford and DeBenedetto (2010). Unfortunately, it is highly unlikely that these values are correct and should be reapplied with more realistic current numbers. There are no constraints of investment budget, since OIM looks to sustain their business in the best cost-effective way possible. As told by direct inputs, they are a non-profit organization where any additional capital gets reinvested in further research. It is estimated that 60,000 clients are helped each year with the market size for stockings being approximately a quarter of the clients. The market size has an increase of 2.2% each year and does not account for any declines of customers due to the lack of financial support. Value is derived from each delivery of a pair of medical stocking that implies an average cost of 200 euros

Revenue = Value - Operating Costs - Total Costs of implementation

Costs

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38 for the stockings plus an average of 60 euros for the consultation. Operating costs start as 80% of the value and have a small reduction per year however the value is increased due to bigger market size. Seven main implementation costs have been determined according to the selected process changes. These are directly connected with the six selected process changes for the final design solution. Eventually these implementation costs will be absorbed with the operating costs, as they no longer need an additional effort to implement. The facilities makeover will imply a big value for the first year while the cost is offset in following years. The cost for implementation for the website, the returns policy, additional inventory and training of new staff will also require big initial investment with later reduced costs. Marketing costs and additional salaries dedicated to staff that works on compression stockings will need to be defined and continuously sustained. A focus on the first year will help conceptualize the implementation and launch of the new protocol to aid the optimal deployment of a company-wide strategy and enable an effective utilization of the available resources as seen in Figure 5.2. Throughout the development and implementation processes there will be two perspectives to be taken in consideration, the technical and marketing activities. As the technical solution is designed it is necessary to also conceptualize how the service change will be communicated to the main end-users of the delivery system. The targeting and positioning of the strategic plan will shift attention of the activities towards marketing, the commercialization of the service (Crawford et al. 2010). The development process may be close to an end with the launch however management of the launch and further evaluations and revisions will be necessary to guarantee success.

Figure 5.2. Launch of a new service delivery system (Adapted from Crawford 2010)

Strategic Plan

Technical Launch Possess business capacity and capability Initial runs Review and Resolve processes Fine tune all

operations Marketing Launch Understand service requirements Finalize launch plan Promotion materials Supply feedback

Hire and train workforce Public relations

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6. Conclusion

The practical purpose of this research examined how to design a successful delivery system that would assist healthcare services that will soon lack financial support. The theoretical importance showed how to model the service delivery of compression stockings using a standard business process modelling language. In according to that, an analysis has been made at a healthcare service to reflect the new delivery system and protocols were developed using BPMN language. This analysis assisted to give detailed insight into the processes of OIM Orthopedie service delivery and the use of the Business Process Model Notation (BPMN) language permitted to create and improve these processes.

Based on that, two protocols were modelled for the current service; a current general service protocol and a more detailed service protocol. To assist the new service delivery system, four protocols were modelled from the current; three protocols for the three generated concepts and a protocol for the final design solution. Additionally, one service blueprint referring to the current process was also created in order to support these protocols in accordance to the main stakeholders and the changes that occur on their service. It is the hope that these service protocols and blueprint paint an interesting experiment on the behaviour of process changes within a healthcare service that could help its understanding.

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40 responsibilities, benefits and expected results will help sustain the future of OIM Orthopedie and similar healthcare service providers.

The use of BPMN language with the regulative cycle of Van Strien (1997) enabled a method which is novel in the industry in designing this type of service system. The testing of this model will help raise awareness for the use of Business Modelling in this type of service delivery and contribute to Design Science research. The proposed design is considered a satisfactory solution for the compression stockings however it is a simplified version of the reality and is not restricted to only the compression stockings. The service provider possesses other products that this research can be applied to. Eventually, this protocol can be used for other similar type of businesses where a desire for the change of their service delivery system exists. Some adjustments of the design will be required to adapt the solution to different situations, however the core of the solution will not be affected. If we add more stakeholders or different stakeholders, the solution would be good enough to implement in a bigger and different scale if it is tested and revised prior to implementation. The goal is to implement it into service delivery models across the healthcare continuum. If OIM Orthopedie also decides to scale, expand or increase the volume of customers the design solution will still held viable. If the end-users are not satisfied with any aspect of the solution it may require additional validation to help identify the errors and correct them.

Limitations

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41 service of delivering compression stockings and not the product itself. Technological advantages, regulations of health and safety were not considered, as different sizes, colours and expiration dates of the compression stocking may have an impact of how attractive the service is and how much they will purchase. The adoption of higher technology by staff can be pointed out as another barrier for implementation. It may be hindered by its complexity in adopting and using the right applications and due to the age of the end-users that may also possess aversion to technology.

Future Research

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Appendix A. Business Process Modelling and Notation Elements

(Balsters, 2016)

 Flow Objects: Main graphical elements that define the behaviour of business processes.

They include Tasks(or Activities), Events and Gateways.

Tasks: represents an action that is performed by someone at a stage of the process.

Events: represents the start, intermediate or stop of a process.

Gateways: represents a process decision, that divides into different decision paths.

 Data: represented by a paper icon, serves as input or output data of a task.

 Connections: Represented by arrows, they offer ways of connecting objects between them.

 Pools and lanes: Represented by rectangles, used for organizing and categorizing tasks.

 Artifacts: Represented by text boxes, used for additional information.

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Appendix B. Initial Interview Questions for OIM Orthopedie

1. What is your name and function?

2. What can you tell me about OIM Orthopedie?

3. Could you tell more about the medical compression stockings? 4. What are all the processes involved in the service?

5. What are the details of the service?

6. What service activities are included in the full procedure?

7. What is the level of expected quality and expected lifetime for the products? 8. How long does it take to manufacture them?

9. How many different departments are in a single office? 10. How many people work here?

11. Which skills are needed by the employers?

12. Which are the front office activities and the back office activities?

13. How is the coordination between the activities from all the different departments? 14. What is the communication level between insurance

companies/doctors/GP’s/hospitals?

15. How many service customer interactions? 16. What is the average contact time per customer?

17. Which standards, tools, techniques, interactions are being used? 18. What is the strategic goal? Is it cost-Driven or quality-driven? 19. What would be the limitations and budget for this new project? 20. What could be unexpected situations?

21. Do you have further questions or anything to add?

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Appendix C. Observation Analysis - Consultation Procedure

The consultation procedure has been captured with a shadowing of the process referring to a visitation conducted on the 20th_{April 2017. This data has been gathered from four} patient consultations:

1. Advisor draws the patient data from the main computer in the office and prints it out., with the most relevant sections being the patient profile and previously conducted measures if he has been a previous patient.

2. Advisor prepares the room that the appointments will take place

3. Advisor refers to the waiting area to check if the patient is currently available. 4. Advisor greets the patient and accompanies him to the consultation room

5. Advisor rechecks initial patient data. In case of any problem, the advisor will need to check with the receptionist desk and reprint.

6. The consultations start with an initial talk about the patient’s problems.

7. If a new patient a medical prescription is presented with the cause or disease. In case of of repeat buyer the prescription is skipped to the identification of problems with the current stockings.

8. The advisor knowledge assists in confirming the best solution with continuous conversation, in order to reach agreement with customer.

8. a) If it’s not possible to measure the leg due to swollenness, the patient needs to go back to doctor and come back for another appointment.

9. The patient undresses their legs, sometimes requiring assistance.

10. Measures are taken place for both legs. Continuous conversation is carried out during. A manual info sheet is utilized for assistance to write down information.

11. After the measurement is done the patient dresses their legs again with or without assistance. Optionally the patient can dress the current stockings if already owned. 11. a) The usage of an additional product, called an easy peeler is utilised for free to assist the client in putting the stockings. This product can also be bought separately.

12. A final conversation is done for any rechecks, how the compression stockings will be delivered and if the patient has further questions.

13. A farewell is shared and the patient is escorted out of office.

14. The adviser rechecks their time and the schedule for the next patient.

Process changes in service delivery