A real option theoretic fuzzy evaluation model for enterprise resource planning investment

The high failure rate of ERP implementation is due to a common pitfall that ERP projects are often enacted as merely investment into installation of IT infrastructure, rather than systematic planning of operation changes, business process re-engineering and a paradigm shift for the operation and management. To manage ERP investment in a changing environment for high payoff, this paper adopts a real option theoretic method. Fuzzy payoff valuation is introduced to deal with uncertainties in order to minimize the risk of failure. The proposed ERP evaluation model is geared towards small and medium enterprises. A case study is presented to validate the proposed fuzzy real options. The results indicate the potential of modeling ERP investment as “Expand”, “Contain” and “Abandon” options in different scenarios. The fuzzy real option model bestows a novel ex-ante cost analysis for justifying ERP investment in the implementation cycle.     

Personal trainer, personal coach

The increasing number of fresh faces in the management ranks, many of them with highly polished credentials but little in the way of practical experience in the work-a-day management world, has increased the need for a new consulting professional--the personal coach. There simply aren't enough volunteer mentors to accommodate the growing medical management profession. Whatever the conditions under which this new professional's services are sought, both the individual to be coached and the organization for which the individual works should approach the arrangement with care and planning. The author offers some guidance for making the arrangement pay off.     

Getting the most for your consulting dollars

Major changes in the health care financing and delivery system have usually been accompanied by an increase in demand within the health care field for consulting services. The passage of Medicare/Medicaid in 1965 is one example. The passage of the DRG-based prospective pricing system in 1983 is another. Both spawned a substantial amount of work, and income, for consulting firms. Now the health care field is engaged in nearly total transformation as the forces of health care reform at the national level are met with myriad adjustments at the local and regional levels. Managed care, already a byword, is being strengthened by a multitude of so-called integrated system initiatives. It is not easy to survive, and the call is out to consultants to save the day, or at least stave off disaster. In the following four articles, Marilyn Kennedy, a member of the ACPE faculty and a consultant herself, gives some advice on how to make the consulting arrangement successful; three physician executives provide a glimpse at consults that have worked, and some that did not work.     

Capitation and informatics

When physicians, hospitals, and allied health professionals bill for services they render, their information processing requirements are relatively simple, at least compared to those of capitated organizations. When payers (insurers or employers) accept financial risk for the health care services of beneficiaries, they have usually invested in claims processing, membership tracking, and, under managed care, utilization review and provider profiling systems. But payers, for the most part, have not invested in electronic collection of clinical information about beneficiaries, nor have they tended to keep all claims they have processed in electronic form for study after accounts are settled and payments disbursed. In this article, we will explore why informatics is so important to capitated organizations and why payers that have traditionally taken financial risk for insuring the health care costs of populations are also learning about the importance of informatics.     

A comparison of quality and utilization problems in large and small group practices

Physicians practicing in large, multispecialty medical groups share an organizational culture that differs from that of physicians in small or independent practices. Since 1980, there has been a sharp increase in the size of multispecialty group practice organizations, in part because of increased efficiencies of large group practices. The greater number of physicians and support personnel in a large group practice also requires a relatively more sophisticated management structure. The efficiencies, conveniences, and management structure of a large group practice provide an optimal environment to practice medicine. However, a search of the literature found no data linking a large group practice environment to practice outcomes. The purpose of the study reported in this article was to determine if physicians in large practices have fewer quality and utilization problems than physicians in small or independent practices.     

Keeping the "care" in managed care: the importance of the therapeutic relationship and psychosocial factors in the managed care setting

There is much truth in the adage that "the more things change, the more they stay the same." Nowhere does this seem more apparent than in health care where, amidst monumental reconfiguration, basic foundations of physician-patient relationships and attention to the impact of psychosocial factors on health and health care delivery remain as critical influences. While the importance of the therapeutic relationship and the influence of psychosocial factors in medical care has been clear in traditional systems of delivery, these factors may be even more critical in managed care systems. These emphases must be incorporated by design, however, and not left to default.     

What lies ahead for medical management?

The consensus is that, in spite of a reluctance in Washington to undertake any drastic reform of the health care financing and delivery system, the changes that are already in place in individual organizations and that are in place or being contemplated at the state level are certain to make the health care system of tomorrow very different from that of today. Physician executives can play an important role in the transition that will be required, but they will have to use a flexible, especially nondogmatic approach if they wish to cope successfully in this increasingly whirling environment. For such physicians, the author says, the opportunities, though unknown, are enormous.     

Managed care information needs: a summary perspective

The key to survival in managed care is management of financial risk. You need to know what is in your contract and what you are obligated to do for which population during which period. Information systems can be an enormous help in managing managed care contracts and the financial risks they entail, but poorly selected and configured information systems will do little good for the organization that licenses them. The most important activity of a physician executive who is moving his or her organization into managed care contracting is to lead the process to define the functional requirements for information the organization will need to manage managed care contracts successfully.     

The effects of self-efficacy on computer usage

This paper examines the effect of self-efficacy, belief in one's capabilities of using a computer in the accomplishment of specific tasks, on computer usage. It introduces an extended technology acceptance model (TAM) that explicitly incorporates self-efficacy and its determinants (experience and organizational support) as factors affecting computer anxiety, perceived ease of use, perceived usefulness and the use of computer technology. A survey of 450 microcomputer users in Finland found strong support for the conceptual model. In accordance with TAM, perceived usefulness had a strong direct effect on usage, while perceived ease of use had indirect effect on usage through perceived usefulness. Self-efficacy had both direct and indirect effects on usage, demonstrating its importance in the decision to use computer technology. It also had a strong direct effect on perceived ease of use, but only an indirect effect on perceived usefulness through perceived ease of use. Computer experience was found to have a strong positive direct effect on self-efficacy, perceived ease of use, perceived usefulness and usage. Organizational support and computer anxiety had only indirect effects on usage, mainly through perceived usefulness. Implications of these findings are discussed for researchers and practitioners.