Medical Device Link.

Originally Published MX May/June 2003

INFORMATION TECHNOLOGIES

The process and technology principles of customer relationship management underlie an effective complaints management program.

Jonathan Horn and Jennifer Radin

A woman with diabetes is measuring her insulin level with a glucose monitor and realizes that the device is displaying an unfamiliar reading. After consulting the device instructions, she still cannot interpret the reading, so she calls the manufacturer's customer service number for assistance. Elsewhere, while reviewing the data printout from a blood analyzer, a lab technician notices that the test halted before it was complete. He runs the test again and gets the same results. He, too, calls the manufacturer's customer service help line for assistance.

Receiving, analyzing, and acting on complaints like these is a critical area of medical device company management. The U.S. healthcare industry, in response to consumer concerns and litigation, is focusing increasingly on the prevention of medical mistakes. Many medical device manufacturers, for their part, are seeking better methods for managing complaints about their products and for reporting serious problems to FDA as required by federal law.¹

Technology is the key. Medtech organizations with a software-based complaints management infrastructure can effectively apply the important information provided by their customers. A customer relationship management (CRM) solution enables a company's customer service representatives to capture data, easily and systematically, in such a way that trends can be identified. What might otherwise have been treated as an isolated incident can, with CRM technology, be seen as part of a pattern of complaints about the product.

Key Issues

A recent survey of healthcare industry chief information officers revealed that technology to minimize medical mistakes and improve patient safety is their top spending priority for the next two years.² Nearly 60% said that such a technology-enabled solution would head their do list, up from 46% the previous year. Most survey respondents named computer-based applications as their most important technology need.

This is certainly understandable. Complaint monitoring in and of itself can be daunting. Device manufacturers' customer service call centers can receive 150,000 calls or more every month. Also, the high turnover rate among customer-service representatives creates challenges relating to training and consistency.

Medical device companies have tended to find complaints management difficult because of the way they have commonly tackled the issue—with a disjointed approach encumbered by separate data stores and processes and closed complaint-handling systems for each functional department. True complaints management is much more than simply complaint handling. It is intrinsically complex because it cuts across corporate functions, systems, and organizations. When management is inadequate, data can be lost and systems may be fragmented, outdated, or nonexistent. An operations problem arises when call centers have undefined or disparate processes, leading to information loss or task repetition.

A Pain Point Diagnostic

Because medtech firms commonly manage complaints and customer relations with nonintegrated processes, computer applications, and databases, it can be difficult for them to access necessary information, maintain compliance with FDA regulations, and properly service customer needs in a cost-effective manner. In such a model, a complaint is received and it goes "somewhere." The response to it may not be adequate. It may not be reported in a timely manner. These consequences of haphazard complaint handling expose the company to regulatory risks of noncompliance and business risks due to customer dissatisfaction.

Such a problematic situation cries out for a solution. To determine if a company has deficiency in this area, its executives should perform a diagnostic analysis that can serve to locate their firm on the spectrum of complaints management best practices. One formal diagnostic tool for conducting this analysis addresses 12 specific challenges, termed pain points, that confront any company trying to manage a decentralized complaint-handling process that cuts across several functions.

• Lack of traceability.
• Inconsistent practices among several call centers, such as defining complaint variously and using different methods of information capture.
• Open-loop processes that lack feedback.
• Inability to trend complaints by multiple categories.
• Lack of adequate security.
• Paper-based processes.
• Difficulty meeting FDA requirements.
• Fragmented efforts resulting from lack of integration and reliance on multiple handoffs.
• Inefficiency and excessive cost.
• Inability to meet time requirements.
• Lack of visibility.
• Lost data.

Medical device companies using this diagnostic tend to score fairly low—that is, have an inadequate or barely adequate complaints management system—because they are constrained in their ability to provide an effective CRM service approach. Scattered data storage, nonintegrated functional departments and processes, and closed systems make managing a customer-focused service function properly extremely difficult. Employees performing one function, say, customer service, don't necessarily share information with those in another function, for example, the legal department, unless a policy requires them to.

That is the essential difference between complaint handling and complaints management. The former is characterized by an isolated approach to logging and reporting complaints, and by a lack of integration between information relating to customer complaints and all other customer interactions. Complaints management, on the other hand, integrates complaint handling with the larger customer service function.

Some medical device companies now interact with their customers via numerous nonintegrated call centers. This decentralized arrangement limits a company's ability to control complaint-handling processes globally, and thus exposes it to regulatory compliance risk in the geographies in which it operates. Complaint-case information gathered from different sources is batch-fed into a call center system. Data become incomplete because of record duplication and because complaint, product category, and other codes are not standardized among all administrative regions. Significant rework thus is needed to repair errors. Ultimately, call center applications that vary from region to region cannot sustain the needs of a company with a growing customer base and with products being used within a strict regulatory environment.

CRM Is Complaints Management

Forward-looking medtech companies will recognize that complaints management, field service, and call center operations support are interrelated core elements of a CRM approach that offers benefits beyond mere regulatory compliance. Such an approach actually treats all customer interactions—even complaints—as revenue-generating or revenue-protecting opportunities. Leveraging customer feedback, it enables a manufacturer to show its customers how much the company knows and cares about them and how well it can marshal its products and services in support of their needs.

Astute firms, driven by return on investment (ROI), will use their CRM capability to manage, not just handle, complaints. CRM also streamlines other service department functions, including field service, returns and exchanges, patient education, and user surveys. A pragmatic CRM environment focuses on reducing costs and customer erosion and increasing customer satisfaction, regulatory compliance, and, ultimately, revenues.

CRM service strategies will vary by company, but, successfully chosen and implemented, they will provide effective and measurable means for avoiding regulatory fines and reducing warranty costs, call times, and the rate of abandoned calls. Having more-accurate customer information should also minimize the problem of returns and refunds.

Complaints management lies at the heart of customer management. Nothing is more critical in avoiding problems with current contracts, obtaining repeat business, building word-of-mouth sales, and achieving market eminence than properly taking care of customer concerns. Managing problems they are having with products gives a company a relatively rare opportunity to interact directly with its customers.

The goal, of course, is to leave the customer satisfied at the end of the interaction. That involves speeding problem resolution by routing calls and complaints appropriately within the company, securing useful responses, and closing the loop with the customer, the call center representative, the field salesperson, field service personnel, regulatory affairs staff, and the regulators in a timely manner. This is true complaints management, which in fact is true ROI-based customer relationship management.

Finding the Best System

In a regulated environment, complaints management poses a complex challenge. Medical device manufacturers face mounting regulatory and market pressures. Unless company leaders can develop an effective customer-focused complaints management solution that works, they risk suffering the various high costs of failed technology execution, FDA censure, and weak customer relationships.

As medtech executives quickly discover, many questions emerge in determining which available CRM solution will best handle their complaints management requirements. These executives must begin by clearly identifying the present system's pain points that need to be addressed. The focus should be on business issues rather than the challenge of a new technology. In this regard, the first step is to explore the potential value that a complaints management and CRM solution will have for the organization.

Gone are the days of installing large enterprise applications without tying them to specific and measurable business benefits. Medical device company managers are under intense pressure to justify the cost of project-based initiatives. The complaints management component of CRM is no exception.

Companies should expect from their service-related departments value-added outcomes that reduce costs, ensure regulatory compliance, improve customer relationships, and increase revenues. In addition, immediate responsiveness to urgent customer requests and returns is critical, because product failure can be a life-or-death situation for customers as well as a legal exposure for suppliers.

Device- and customer-history visibility is necessary for identifying all potentially affected patients and product placements, and to track the source of the product failure or defect. These types of specific criteria, as well as the benefits derived from their proper management, should be quantified with a business case before selection and implementation of a complaints management solution.

A CRM-based complaints management solution should include cross-departmental processes and procedures enabled by underlying, preferably Web-based, technology. It should entail an integrated approach to tracking complaints enterprisewide by product, problem, symptom, outcome, geographical area, lot number, and customer type. And whether a company is global in scope or consists of several business units in a single country, a key system feature is the ability to maintain standards among departments that are geographically dispersed.

The right solution will facilitate reporting of complaint details and complaint resolutions to FDA and other regulatory agencies, and will automate follow-up actions and communications between the complaints management and product development departments of the company. It will establish a foundation upon which to build an open, integrated environment for other functions within the service and sales areas, and will make data available to the marketing department to support customer targeting, profitability enhancement, and other customer-management-related activities. A critical element of the best solution will be its ability to adapt to changing FDA regulations.

After establishing the capabilities expected of any complaints management system that might be implemented, the next step for the decision makers is to consider which of various available solutions might meet the needs of the organization. Executives should investigate the operational adequacy of candidate systems in several key functional areas.

Information Gathering and Availability. Complaint information will come into the system from patients, doctors, nurses, and lab technicians—potentially anyone using the device. Every call should be logged so that each becomes a data point for the system to tag and trend.

The system should be based on a single data repository from which can be produced a single complaint file for any product. Each file should be able to access and incorporate data from other systems in order to maximize the accuracy of the information collected. Because it consolidates data, systems, and computer applications, the solution will minimize the number of necessary interfaces. In addition, it should make access to data easy, minimizing the time necessary to handle each case or any group of cases.

Enterprisewide Integration. How the solution distributes its complaints management processes across the departments involved—quality assurance, customer service, sales, regulatory affairs, and others—so that the system provides standardized data and enables communication across departmental silos is an important consideration. The process must clearly define what constitutes a complaint, allowing data entry to be standardized and coordinated throughout the organization. This makes possible rapid identification of a disturbing trend that could presage an adverse event.

Such an integrated environment generates concerns of its own. The solution should clearly define roles and responsibilities, including associated security levels, to ensure that information is shared on a strict need-to-know basis. Another factor that matters is compatibility of the complaints management system with enterprise resource planning (ERP) and call center technology.

Ready-Made Functionality. The system chosen must be able to support the needs of the business. The capabilities it provides are therefore an important consideration. For example, customer service representatives could benefit from a system that displayed the decision tree to follow when a call was received at the manufacturer's call center. Of particular importance is the ability to generate a MedWatch report on Form 3500A to be sent to FDA in the event of a death, serious injury, or device malfunction. And corrective and preventive actions (CAPA) functionality is a necessary support for product investigations.

Coordination with Other Departments and Functions. Customer service, field service and repair, sales, marketing, management, engineering, quality assurance, and supply chain functions have to be aligned with complaints management processes and systems. The latter should support call center and replacement-order-entry functions for all customers, products, and locations.

The solution should take a CRM approach to gathering, classifying, and preserving information pertinent to the anticipation, diagnosis, and resolution of product-related problems. The decision makers must determine whether it offers direct access to warranty information, to specific product details that could speed problem resolution, and to a Web-based entry and status-reporting system that provides customer service, all of which will enhance the utility of the system. Customer service representatives should be able to track products easily by serial number to effect repair, replacement, and recall.

The solution must also have the ability to alert help-desk technicians and, importantly, company management to customer reports of critical or recurring problems with particular products. Such alerts are invaluable for enabling defects to be corrected quickly and customers to be notified before a problem becomes widespread.

Ultimately, representatives of the device manufacturer and the CRM solutions provider must meet to settle on a strategic approach that will comply with FDA regulations as interpreted by the parties. FDA is toughening its oversight of medical technology; the new commissioner already has signaled a sterner approach. The agency has been diligent recently in monitoring and patrolling complaints pertaining to medical devices. Within the past 18 months, the agency has sent warning letters to, fined, or recalled the products of numerous device manufacturers that failed to adequately report customer inquiries they received about certain products.^3–5

FDA requirements are relatively straightforward: medtech manufacturers must report events that severely affect the patient's health—causing a death or requiring major medical or surgical intervention—within 5 days, and other less-critical incidents or malfunctions within 30 days. What makes compliance complicated is that regulatory requirements can be executed in so many different ways. Failing to comply with FDA regulations, for whatever reason, can damage the device company's reputation, its products' market position, and its ability to profitably sell those products, or even market them at all. However, the company has the responsibility of finding a way to incorporate FDA requirements into practice in order to remain in compliance.

Conclusion

A complaints management system based on Web-enabled, open-architecture technology can relieve a medtech company's pain points by standardizing complaint-related processes and systems and allowing systems in other corporate functional areas (ERP, sales, marketing, etc.) to share data. An optimal system is one that addresses potentially serious problems in a cost-effective manner. And of course it should support compliance with FDA regulations.

Following the CRM approach, a good complaints management system will instill in customers confidence that their product performance inquiries are being registered accurately, dealt with appropriately, and, ultimately, used to develop better future devices and improve service. That's a return on investment, and that's good business.

References

1. Code of Federal Regulations, 21 CFR 803.

2. 14th Annual HIMSS Leadership Survey: Trends in Healthcare Information Technology, [on-line] (Chicago: Healthcare Information and Management Systems Society, 2003 [cited 7 April 2003]); available from Internet: http://www.himss.org/2003survey/ASP/healthcarecio_final4.asp.

3. See the home page of FDA's Center for Devices and Radiological Health, http://www.fda.gov/cdrh/index.html, for news of recent developments relating to "Recalls," "Reporting Problems," and "Safety Alerts."

4. "FDA Warns Companies on Complaint-Handling Errors," The GMP Letter 264 (January 1, 2002): 8.

5. "Complaint Handling Requires Team Effort, Says FDA," Devices & Diagnostics Letter 28, no. 22 (June 1, 2001): 7.

Jonathan Horn is a partner and life sciences CRM practice leader, and Jennifer Radin is a senior manager and life sciences medical device solutions manager, for Deloitte Consulting (New York City).

Copyright ©2003 MX