In order to turn the center around a comprehensive crisis management plan aimed at bringing down expenditure and increasing short-term income must be put in place. Costs can be reduced by doing away with the corporate offices and the corporate staff. Elimination of the executive offices will not affect the running of the center since most of the functions performed at these offices are usually carried out daily at both centers (Rutsohn & Forget 676). This move would eliminate the monthly cost of maintaining the offices and staff that is estimated at around $40,000 to $60,000.
Given the size of the Rosemont Company, it is sufficient to have operating officers running both facilities. The day to day administrative duties of both centers can be performed by one clinical director and one director of nursing. Provision of the necessary revenue and expenditure information to administrative and operating officers would increase the efficiency of operations (Rutsohn & Forget 676).
Revenue can be increased by implementing a mobile detox care program as well as boosting admissions by training telephone personnel so that they are capable of closing sales. Integrating the payment collection services at different locations into one system would also be helpful in revenue collection.
Strategies available to Rosemont
A short-term intervention that involves a teamwork approach towards managing the financial crisis at the Rosemont is available. The objective of this intervention would be to increase the company’s efficiency, boost staff morale, reduce expenditure, and boost revenue (Rutsohn & Forget 674). The mandate of the crisis management team would be to harmonize operations between the two facilities and implement a uniform cost-containment policy with an aim of reducing operating costs (Rutsohn & Forget 677).
Also, the Rosemont can implement a long-term intervention with marketing strategies that will ensure the future success of the company. For instance, making contractual agreements with managed care companies and government medical insurance programs would increase market penetration necessary for the future success of Rosemont (Rutsohn & Forget 683). However, care should be taken to avoid an imbalance in the patient base with the large portion of patients being covered by social programs such as Medicaid; this would have a negative effect on revenue flow. The patient load at both facilities can be increased three times in two years by reducing the admission durations and raising the number of outpatient therapy sessions (Rutsohn & Forget 680), thus, increasing revenue.
Recommendations to Cates Concerning the Board of Directors.
The Board of directors at the Rosemont is comprised of Cates, Lloyd (CEO), and his five friends who are either his golfing buddies or business partners in different business undertakings. The current board does not seem to make any notable contributions to improving the status of the company. Apparently, the appointment of the members is not based on their expertise but on their relationship with the CEO or their social status (Rutsohn & Forget 674). The judge’s membership is based on his friendship with Lloyd and his social network. There is a notable conflict of interest with three members: two of whom are partners in the firm that audits Rosemont’s accounts and the other one is the owner of several supplying companies to the Rosemont. The board of directors needs to be replaced with qualified individuals whose expert contributions will propel the Rosemont to future success.
Works Cited
Rutsohn, Phil, and Forget, Bob. Case 10 The Rosemont Behavioral health Center. Marshall University. Web. 16 Feb 2016.
