Fusion Newsletter Article: You Have a Choice: Considerations When Going Contract Managed

You Have a Choice: Considerations When Going Contract Managed

You Have a Choice: Considerations When Going Contract Managed

In today’s healthcare landscape, which is currently being shaped and slimmed by mergers and acquisitions, organizations must be more budget conscious than ever before. According to the Harvard Business Review, major health systems are losing significant amounts of money in operations at an alarming rate, with one organization even experiencing a 71% decline in operating income within one fiscal year. In addition, because budgets are continually getting tighter, but still expected to cover the needs of all departments, the competition for proper funding is fierce. Foodservice especially is often forced to look at creative ways to optimize efficiency and reduce costs, without impacting employee and patient satisfaction from executing newer, cost-saving initiatives.

Within the last decade, more and more hospitals have remedied this by seeking outside assistance from contract foodservice management companies, and with good reason too. By outsourcing the complexities of a dining operation, and utilizing their purchasing power and access to highly-skilled staff, hospitals can certainly improve foodservice operations amidst a trying time in the industry. With that being said though, part of the issue foodservice departments face with contract managed companies is the loss of operational control. More specifically, hospitals typically experience a loss of autonomy and ownership of data when contract management companies implement their own foodservice software solutions. Meaning valuable information, which is necessary for assessing costs, reallocating funds and benchmarking performance achievements, can all be gone if a hospital decides to stop using their services. Not to mention the fact that these companies usually only offer 90 days for departments to transition to a new system upon canceling, which can strain staff time (IT especially!), increase the possibility of patient errors, and add additional costs from installing new hardware/licenses - especially if implementation is needed across multiple sites.

What can be done to ensure foodservice departments maintain control and have the ability to leverage data when making decisions, regardless of which contract managed company they use or if they decide to go self-operated, is employ contract management agnostic software. Or better put, software that isn’t restricted to specific vendors and can integrate with any contract managed company - without impeding on a foodservice department’s ability to control and compile past and/or present data. Moreover, having software separate from a contract management company gives foodservice more flexibility to change companies, if ever desired. Thereby allowing them to make decisions based on patient needs and what’s in their best interest, as opposed to whether or not they want to deal with the headache of a large software transition project.

So Remember, You Have a Choice!

We all know the contract management debate often leads to polarized viewpoints - either you operate on your own (utilizing your preferred software) or larger companies operate for you (utilizing their preferred software). However, there is a third option. Hospitals CAN use the buying power large contract management companies provide and they CAN also have the freedom to evolve and make data-driven decisions by incorporating a foodservice software solution that isn’t tied to one company. Particularly, one that can fit the unique needs of the foodservice department to help them continue to be a vital part of the patient experience. Because while the healthcare industry is certainly changing, the ultimate goal of foodservice never will - to provide patients with nourishment and care in their time of need.


Article by: Jennifer Higgins, Marketing Specialist II; Fusion, 1st Quarter, 2019