In the second of our three-part series of lessons from the NDIS trial sites, we focus on systems level issues. Click here to read Part 1.
Attracting clients requires a completely different approach in the new NDIS world. You need to develop consumer attraction and retention skills and have market research capability (even just a little). There are three key channels of referrals emerging the NDIS:
- Word of mouth
- Word of mouth
- Online word of mouth
Lesson: your staff customer service skills need to be awesome and your marketing focus needs to be upstream (read more on this in our article on Upstream Marketing).
Engage for Success
Engaging with consumers is the new smart business decision. Go on the NDIS learning journey with them, support them to become ‘demanding customers’ and your business will benefit big time. It’s all about relationships.
Lesson: Get started and spend a little time and hospitality engaging current and potential clients in discussion about what they fear and what they most need. Group information sessions can work great.
This is not the bad old days of disability where it is very difficult to get changes made in decisions that negatively affect consumers. The NDIA have acknowledged the NDIS will continue to be a work in progress and things will change when the need is evidenced. So, if you know the consumer is disadvantaged by an NDIA decision, then escalate. The key message is consumers need to be at the centre of any review process, not the service provider.
Lesson: Don’t take no for an answer if you think they’ve got it wrong. Work your way up the NDIA hierarchy, but work with consumers in the escalation process.
Educate Decision Makers and Staff
Many board members, senior managers and most staff still don’t see or understand the extent of the NDIS change that is coming. Everyone in your organisation needs to get informed as quickly as you possibly can if you are going to avoid a serious gap between where you are and where you need to be.
Lesson: Invest in NDIS education processes now.
Lower Prices Everyday
Yep, NDIA payments are generally less than the payments received in block funding. Margins are tighter and life is harder. Some providers are facing the challenge by saying they are paying hands-on staff too much. This is before they have analysed their back of house and corporate overheads. Unit costing means looking at all your service costs and seeing where savings can be made across the organisation, not just in wages.
Lesson: Pricing is mission critical and unit costing involves an examination of all costs of service. Wages are one of the last areas to cut when customer service is critical.
Time is Money
The NDIA have turned out to be good bill payers with quick turnaround times from when you invoice them to when they pay. It’s the service providers who are struggling to capture the hour of service delivered and turn that quickly into an invoice sent to the NDIA. Small business knows all about the importance of cash flow. Too long a lag between service and invoice can kill your business.
Lesson: Software and hardware for capturing service hours and turning it into invoices is vital to success. A staff culture of accountability for time is also essential.
Despite what people think, the NDIS is not a pure ‘market forces’ approach. Nor is disability a ‘mature market’ in any sense. There are many examples of market failure already at play. From rural and remote to CALD and Indigenous NDIS services, individualised funding is simply not working. The recent NDIA workforce strategy acknowledged the problem by identifying some need for ‘bulk purchasing arrangements’ in these areas.
Lesson: block funding is back on the agenda in some parts of the scheme (yay!)
Lost in Transition
Transitioning existing services to the NDIS is much messier than the anyone would have liked. There is a lot of double handling and there are significant costs involved for providers that are straddling the old and the new systems. Funding accountability and reporting across two service systems can be a nightmare.
Lesson: Expect extra work in transition and cross your fingers that the transition is better managed in full scheme roll out.
As we have seen with block funding, the NDIA will continue to change the business drivers of the NDIS. This has been helpful at times, with organisations able to lobby for changing the payment rates for some activities that the NDIA under-priced. Other changes have been more difficult such as the NDIA’s changing expectations in areas such as transport. The NDIA is working the scheme out as they go and this level of change can be expected throughout the next five years as the NDIA is fully rolled out.
Lesson: Flexibility and agility are going to be very important in an NDIS world of uncertainty. And once again: beware your fixed costs.
This is the second article of a three part series. Click here to read Part 3.