Historically, risk management has been a cost center in the healthcare industry; an insurance function that focuses on reducing the expenses associated with medical error and protecting institutional value rather than driving it. But as healthcare evolves and budgets continue to tighten, its time to look at these programs as harbingers of possibility.
When The Risk Authority Stanford (TRA Stanford) realized that our risk management services and products were outperforming national industry benchmarks, we decided to expand into other financial risk initiatives and analyze national best practices. Our study revealed that we were developing and implementing cutting edge tools and breakthrough methodologies that we hadn’t yet encountered in the market. Based on Decision Analysis, these processes and tools have the potential to dramatically impact patient safety and quality care, analyze risk-decisions through empirical data, and reach for value creation in lieu of traditional value protection.
Decision Analysis enabled TRA Stanford to quantify the benefits of our programs and evaluate them for continuation. The process provides a tested means of making high-quality decisions under uncertainty by identifying, structuring, and quantifying the cost and benefit variables of a given decision. This level of detailed risk analysis engenders opportunities for value creation and produces a robust, transparent, and defensible overview of program value.
Decision Analysis provides the tools for communicating clearly and directly with decision-makers without relying on analytical details, becoming, over the last 40 years, the standard method of making investment and program decisions in the medical industry and public policy.
Value-Driven Enterprise Risk Management
Through the process of Decision Analysis, we dedicated ourselves to establishing a risk consulting firm that breaks the barriers of traditional risk practices, implementing innovative solutions and educating ourselves on the nation’s most pressing healthcare needs. By expanding our product lines and focusing on how to maximize return on investment by combining Decision Analysis and enterprise risk management, we were lead to Value-Driven Enterprise Risk Management (VDERM), completing our transformation from cost center to profit center for Stanford and beyond.
VDERM is the next generation in enterprise risk management, using evidence-based insight to quantify uncertainty and identify alternatives that simultaneously decrease risk and increase upside risk opportunity. VDERM informs strategic risk decision-making and provides tools for quantifying value creation, helping our company and clients capitalize on upside risk opportunities and maximize return on investment.
Cost Center to Profit Center
This paradigm shift has been the catalyst in launching us from cost center to profit center, constantly striving for value creation through disruptive innovation. Our capacity as a profit center has allowed us to holistically assess institutional risk, increasing value in many areas that are typically beyond the purview of risk management.
Our time spent in consultation with clients around the world keeps the TRA Stanford team energized and introduces us to fresh ideas and approaches, informing and inspiring new services that optimize value creation. This diversification lends credibility to our brand reputation, and leverages our internal expertise to influence healthcare on an international platform.
Above all, TRA Stanford’s transformation into a profit center has afforded us the opportunity to reach farther than risk management ever has before. Through creative thinking, breakthrough technology, and cutting-edge solutions, we strive to create value in every possible way, to eradicate medical error, and to keep patients safe from harm.