Over the last few years we have seen an explosion of the want and need for “Big Data”.
As some of the world’s largest corporations, organizations and governments begin to grapple with how to use their data better, they are beginning to integrate big data into their strategic planning, policy decisions, and resource allocation. Today, big data is changing the rules of business operations, creating opportunities for small businesses and challenging the way we look at pharmacy.
Big data for the small pharmacy
Big data is no longer just for big business. With the steep costs and large technical hurdles, it can feel as if this is an area where small businesses will never be able to compete. The inability to buy large data or hire in-house analysts appears to hold back many independent pharmacy owners from unlocking the potential in their data. This perception could not be further from the truth. The reality is that small pharmacy owners sit on a goldmine of data full of potential. Big data analytics can help ensure small businesses are harnessing their data to inform decisions, improve performance to achieve greater efficiency, grow their business and improve patient care. This insight can also be valuable in valuations and assessing risk in buying and selling businesses.
How can data analytics help?
Data analytics and business intelligence can help pharmacy owners in four major ways:
1. Understand your patients better
How would you describe your patient population? How large is your patient population? Your perception of what your pharmacy population is can be heavily skewed by who takes up most of your time or needs the greatest attention, a sort of observation bias. Using data analytics, you can objectively describe everything from the age and sex of your patients to the most common disease and how far they live from you. You can begin to explore patient loyalty, use of pharmacy services, and how you compare to the population around you. More importantly, by knowing what your population is, you also gain insights into who is not in your patient population.
2. Know your risk and benefit
Understanding the risks and benefits of business decisions is often challenging. You might know what threatens your business or what efficiencies may help you, but quantifying them is another challenge. This makes it extremely challenging to plan for the future, such as staff requirement or investing in equipment and programs. This becomes even more important as sudden changes occur, such as policy changes in reimbursement or changes in business relationships.
3. Make sense of the numbers
As the captain of your own ship seeing trends is often very easy for owners to do. You may see shifts in prescription volume or changes in their bottom line – but the underlying cause is often difficult to pinpoint. In many cases the best we can do is speculate based on our own observations. Analytics allows us to explore the interconnected relationships of our patient population, prescribers, and historical trends to find true answers and quantify them. This insight can help us explore solutions or better plan for the new future.
4. Know what your business isn’t!
Knowing what your business isn’t is an important strength of data analytics. Much of the insight and observations we have tell us what the pharmacy is and who the patients are. However, by leveraging external data sources, a pharmacy owner can understand what they are not and patients they do not see. This insight can help in strategic planning that is important for expansion and pharmacy acquisition, targeted advertising campaigns and community involvement.
Data analytics is here to stay and has become the new normal. Independent pharmacies have a great opportunity to make use of data that is right at their fingertips.