When Bob Funari and his executive team acquired majority ownership of Crescent Healthcare Inc. in 2004, the company was facing severe economic challenges.
But by moving away from commodity-based transactional relationships and toward value-added partnerships, Funari soon changed the outlook.
His team has forged a new culture that values teamwork, accountability and innovation. Along with it, they’ve more than doubled sales, eliminated significant operating losses and achieved profitability goals.
Because of this, Smart Business, ThinkASG, IBM and Union Bank named Funari to the class of 2011 Smart Leader honorees. He shared how he innovatively transitions his company’s strategic direction to overcome challenges.
Give an example of a business challenge you and/or your organization faced, as well as how you overcame it.
Crescent Healthcare was a company facing severe economic challenges when our executive team, backed by two private equity investors, acquired the majority ownership in 2004. Over the past six years we have created a culture that values integrity, professionalism, teamwork, personal accountability, innovation and a bias towards action.
As a result, we have more than doubled sales, eliminated the significant operating losses, and achieved our profitability goals. We have financed all of our growth and investments from internally generated cash flow while reducing our bank debt by 80 percent.
In what ways are you an innovative leader, and how does your organization employ innovation to be on the leading edge?
Our mission is providing high-quality care that is both appropriate and cost-effective to patients with complex disease problems in alternate settings.
For the past three years, we have been focused on transforming our business relationships with health plans, hospitals and physician groups. We are rapidly moving away from transactional relationships where the services we provide are perceived as commodities and where competition is based on price, to partnerships where there is an opportunity to create significant value for our customers, resulting in benefits for both of our organizations.
Two specific examples illustrate this change in our strategic direction:
- We reduced the cost of IVIG infusion therapy for a major health plan in California by over $4 million per year by medically managing their members to insure that they received appropriate and cost-effective care with excellent clinical outcomes and positive patient experiences.
- We reduced the cost of unfunded care for a major health system by over $1.5 million per year by redirecting the delivery of care to more cost effective alternate site locations. The quality of care we provided resulted in no readmissions and high levels of patient satisfaction.
How do you make a significant impact on the community and regional economy?
The services we provide improve the quality of life for people throughout California. Every year, the care we deliver saves or sustains the lives of over 30,000 people.
We have increased the number of people working for Crescent Healthcare from 436 in 2004 to 535 today. At the time we acquired the majority ownership position in the company, we made significant improvements in the health care and retirement benefits we provide to our employees.
Our family foundation contributes over $150,000 each year to organizations that address the health care and educational needs of children who have significant unmet needs.
How to reach: Crescent Healthcare Inc., (800) 722-8085 or www.crescenthealthcare.com