Clinical Laboratory Partners: James E. Fantus, Laboratory CEO

by HCE Exchange on August 19, 2010

A focus on quality proved profitable for Clinical Laboratory Partners (CLP) as this Connecticut provider of testing and research services for area hospitals and physicians doubled in size in just less than three years. Laboratory CEO James E. Fantus called on his three previous experiences with laboratory-related organizations, each in need of redirecting, to lead the quality turnaround that this laboratory needed to compete in the industry, particularly with number-one contender Quest Diagnostics.

“That’s a key accomplishment,” Fantus said.  “The lab has always had quality test results, but customer service wasn’t always viewed as up to par.  We had a big focus on improving the quality of everything that we did, created an aggressive sales and marketing campaign, and focused on our largest competitor, to do things better than they did.  It worked out for us.”

Established in 1998, CLP boasts more than 700 employees, spread among approximately 70 locations throughout the state.  In addition to individual sites, CLP manages laboratories at Hartford Hospital and MidState Medical Center in Meriden, Conn.  All three entities fall under the umbrella of Hartford HealthCare Corp, one of the largest health systems in the Northeast.  Overall, Fantus said CLP sees more than 1 million patients a year.

Fantus came to CLP in January 2006 from S.E.D. Medical Laboratories in Albuquerque, NM, where he also served as CEO.  He said that from the beginning he could see the Connecticut laboratory’s potential for success.

“It was obvious to me that this company suffered from a leadership issue,” he said.  “They weren’t going down the right path.  They weren’t focused on the right things.”

Areas for Improvement

Fantus focused facility efforts on eliminating waste in all areas of the business and shortening processes for smoother work flow.  Along those lines, he created a verification system to reduce clerical errors in reports.  He also had personnel focus on how quickly they answer phones.  In addition, CLP improved logistics processes so that specimens would arrive from doctors’ offices and other CLP locations in a more timely manner.

“As a result of all that, we received unsolicited feedback from customers that they saw dramatic improvement in our response time and in the accuracy of the clerical information that we were reporting,” he said.  “They were finding that we were more focused on meeting their individual needs.”

Laboratory Upgrade

Clinical Laboratory Partners has undergone significant expansion of tests performed in-house across a variety of disciplines including autoimmune disease, endocrinology, toxicology, microbiology and infectious diseases.  Cutting edge technology has also been introduced in the fields of molecular diagnostics and cytogenetics.  All these changes improve test turnaround time, provide a local testing alternative, facilitate patient care and promote physician satisfaction.  Mr. Fantus also points out that implementation of these cutting-edge technologies and instrument platforms stimulate learning, research/academic development and positively impacts employee morale and job satisfaction.

By improving employee training, Fantus believes CLP improved its image in the industry, leading to the repatriation of lost customers.  Erasing its poor reputation also resulted in increased employee retention, helping CLP work closer to its goal of becoming a “best employer” in Connecticut.  Employee pride has returned to the laboratory.

“Our turnover rate has dropped from greater than 30% to less than 15%,” he said.  “That’s a key measure on creating a better workplace.  We have gone from begging people to work here to being able to select the best of the people who are out there.”

Improved Quality for Improved Status

Communication with employees throughout the multiple CLP sites is important, as Fantus wants everyone working toward the same goals.  He uses newsletters and town hall meetings for sharing company information with employees, but relies on his senior management team to push customer service and quality to the entire organization.

“We changed the outlook and the future of this company by improving quality,” he said.  “It was a focus on making the company competitive, so that customers wanted to use us by choice.”

Increased quality throughout the organization has lead to more business, offsetting CLP’s fixed costs.  Since Fantus’ tenure with CLP began, the margin has improved 20%.  He clarified by saying that doesn’t represent a 20% improvement, but a shift of 20 points in the actual percent of profits.

Capital Investments

Along with quality improvements, CLP invested in two capital projects – information technology upgrades and infrastructure growth, both completed with internally generated funds, Fantus said.  The decision was made several years ago to deliver laboratory results more efficiently and in as many ways as customers needed their information delivered.  To meet that goal, the organization improved its Laboratory Information System (LIS), the main computer system used by laboratories in their daily operations.  Improvements were made to make the system more user-friendly for internal and external use.

Infrastructure improvements are evidenced in CLP’s increase laboratory locations from 25 when Fantus joined the organization to 70 locations now.

“That’s a pretty big investment for a company that was losing money for the first eight years of its existence,” he said.

IT Industry Partners

The CLP information technology team maintains a constant pipeline of enhancements necessary to improve the organization’s primarily proprietary system.  Fantus said there is always a system upgrade in the queue, which is important for CLP to gain a competitive advantage in the marketplace.

As for outside vendors, CLP uses Seacoast Laboratory Data Systems to handle its accounts receivable system and its main management system.  In addition, CLP recently implemented a computer tracking system for STAT tests that has staff monitoring where a specimen is located throughout the process.  CLP commits to a four-hour window from the time a doctor requests specimen test results as soon as possible to when the results are delivered to the doctor; competitors allow six hours for the same process.  At CLP, the first hour allows for the specimen to be picked up and delivered to the lab for testing.  Another hour is allotted for testing.  A call should go out to the customer reporting results in the third hour.  If it’s not called back within the three-hour window then they start looking for the report, with one hour to rectify any delay.

“We meet that four-hour turnaround time 97% of the time,” Fantus said.  “Before, we were lucky to make it in half that time.  That’s the kind of thing we’re doing to put ourselves ahead of our competition.”

Lean Transformation

With a goal of doubling size within its current location, CLP launched a Lean Transformation business plan of working smarter to complete more with less, and improve quality through the application of this scientific method.  Fantus is leading this transformation, vowing to “become a black belt in Lean management.”  He has named the lean initiative the CLP Quality Management System.

“We’re going to train everybody in the company, but it doesn’t work when leadership doesn’t promote it and get involved with it,” he said.  “We’re going to focus more on Lean versus Six Sigma, but we’re going to also train people in Six Sigma and apply it where it will make a difference, where removing variation is the key versus weeding out processes to make us more efficient.”

Fantus expects more improvements to come from within, with a program he is currently calling “The Stupid Things My Company Makes Me Do” campaign.  This program would incentivize employees to submit real-world examples of workplace tasks they are required to do that no one can explain but that waste time and resources.

The CEO also relies on metrics to measure whether or not the organization is achieving certain goals.  In the area of proficiency testing, where blind samples go through the laboratory testing and reporting process with results sent to an accrediting agency, CLP previously had a goal of being 98% accurate.  When Fantus asked about the logic behind that goal, he was told that being right 98% of the time is “pretty good.”

“We’re a healthcare company.  Being right 100% of the time is the only thing acceptable,” he said.  “We know we’ll never get there but we’re a healthcare company.  We can’t tolerate a single error and not address why that error occurred, or put a fix in place so that you never see that error again.”

Challenges

The biggest challenge Fantus sees at CLP is managing growth.  With improvements in quality and successful sales and marketing efforts, growth is a problem this CEO likes to have.

“If we didn’t have growth that would keep me up at night,” he said.

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{ 1 comment… read it below or add one }

Katherine Wider March 21, 2012 at 4:27 pm

This article is astronomically inspiring. Thank you.

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