Keeping ahead of changing customer expectations, shifts in the market, and competitors going in new directions are among the essential steps to stay relevant.
Australia’s aged care system is in a period of significant reform; impacting all parts of the sector from large and small providers, to not-for-profits and for-profits alike. Changes will continue to affect the sector and challenge current ways that services are funded and delivered. At the core of these changes is the fundamental shift in the role of the customer and their increasing expectations of service.
In these turbulent times, the critical question for providers is ‘what do I need to do to stay competitive?’ Here we explore six essentials steps.
Customers are more important than ever to an aged care provider, and providers need strategies, resources and support to attract and retain them. We have written a number of articles addressing this topic (see Customer Experience in Aged Care and Understanding Customers in Aged Care).
To assess how well you know your current and potential customers, ask:
Knowing the answers and responding means that you can shape and support quality customer-centred services, ultimately helping you to attract and retain customers and remain competitive.
Changes in the aged care market include the emergence of greater numbers of for-profit organisations, and new partnerships – for example property developers and aged care providers working together to provide retirement living and residential aged care offerings. There has also been significant activity with mergers and acquisitions, publically listed providers and private equity funds investing in residential and home care.
In addition, many providers have expanded interstate and new entrants have entered from adjacent sectors such as disability, nursing, and allied health labour hire organisations. Franchise business models have emerged – with some well-established internationally.
These shifts away from ‘traditional’ aged care business models has seen rapid growth for many organisations that would not have been possible otherwise. Providers are also looking for new ways to gain efficiencies through working collaboratively or developing new business models. In particular, providers are exploring how they can work together from a back office point of view, creating efficiencies which allow them to focus on service delivery.
New trends and service offerings are continually emerging; so a key question to ask is, do you know what your competitors are doing? Moving with trends and being innovative is a must to be competitive. For example:
As customer expectations in aged care services change, your competitors are responding and so must you to stay competitive. Understanding the market offerings will help you differentiate your service and communicate to customers why they should choose you.
Aged care has traditionally focused on what is happening within the industry, and hasn’t been quick to adopt practices from other industries. However, it is important to look outside the sector, as many of the key issues facing aged care are also significant to other industries.
Ask yourself, how do other industries attract and retain customers; what new technology is emerging; what are the innovative business models?
For example, the airline industry has never been more competitive; Air New Zealand is just one airline that is constantly innovating (think of the ‘sky couch’), trialling new business models (such as allowing customers to purchase seats, meals and luggage separately) and using creative marketing.
Research doesn’t need to be overwhelming – but should be enough to help inform the strategy of your organisation and then the implementation of that strategy.
A large part of the customer experience depends on staff, as they are the face of your organisation, and generally make up 80 percent or more of the costs within aged care. Therefore a skilled and flexible workforce is necessary. The key factors are investing in empowering and enabling staff, building a desirable culture and identity, and celebrating your staff.
Your chosen workforce model needs to be sustainable whilst supporting your services and how you deliver them. With home care customers able to leave the service at any time, a consideration will be on what basis you employ staff, including the mix of permanent and casual staff, and/or the use of brokerage to fill service gaps or use as top-up staff.
As you change the way you respond to customer needs, the types of workforce you employ may also change, for example, you may consider employing staff with fitness backgrounds to work as personal trainers, or counsellors for mental wellbeing services.
Being able to effectively manage your performance as an organisation is critical to ensuring you are competitive. This covers a broad range of functions and includes at a minimum monthly monitoring of performance indicators, including:
To enable this, you need to have the right supporting infrastructure and systems in place. This includes well developed performance indicators, good governance and financial management, fit-for-purpose IT systems, finance systems, and procurement.
Additionally, understanding the cost drivers and what a service costs to deliver are vital to ongoing financial sustainability. Given funding constraints in residential care and the variability of revenue from home care packages, understanding costs will allow you to deliver services both efficiently and effectively, as well as to decide on your approach to innovation.
Being competitive is essential in the current aged care environment. Remain competitive by:
With the next wave of aged care sector reforms still unclear and the impact unknown, these six steps need to be continually revisited. Staying competitive is not a ‘set and forget exercise’. The expectations of customers will keep evolving, as will the nature of the market, and any competitive provider will always be ahead.
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