14 August 2014
Top Tips for managing the impacts of reform: Activity Driver Improvements
Identifying and measuring the activity drivers in your service is only part of the priority. Understanding how to manage these activities in order to improve returns is where true value is realised...
Identifying and monitoring key activity drivers of your organisation is critical to managing the impact LLLB reforms have on your service provision. Understanding activity drivers provides richness to your financial data, particularly where your organisation operates with a particular level of income or staffing profile.
Read further for tips on how to manage and understand activity drivers that have a major impact on the performance of your organisation.
Figures for last year and last month provide hard facts and established patterns for your organisation, and identify potential problems and opportunities. These findings are critical to recognising key activity drivers.
In addition to your internal benchmarking, comparing your service provision with other similar organisations, especially competitors will aid in identifying key activity drivers.
An experienced employee is three times more productive than a new recruit. The recruitment and training process is also a major burden on aged care organisations – particularly following new staffing requirements from 1 July 2014. To reduce staff turnover, introduce a long-term incentive element into remuneration packages.
With the new LLLB reforms, residents can default and leave you out of pocket, forcing your organisation to chase third parties. An effective way to control debtors is to produce an aged list of debtors on a weekly basis, showing which bills are overdue, and by how many days. Any payments that are overdue, or noticeably large should be tracked to ensure prompt action is taken.
Concentrate on the key variable costs (the cost to service residents, for example), and what causes them to increase or decrease.