Quest Diagnostics Incorporated · NYSE:DGX
Quest Diagnostics — Investor Day (November 2014)
15 slides from Quest Diagnostics's investor day presentation, Nov 5, 2014
Slide 1: Driving Operational Excellence
Driving Operational Excellence Jim Davis Senior Vice President, Operations November 5th, 2014
Slide 2: Safe Harbor Disclosure
| 2 Safe Harbor Disclosure The statements in this presentation which are not historical facts may be forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date that they are made and which reflect management’s current
Slide 3: Cost Excellence Driving Operational Excellence
| 3 Cost Excellence Driving Operational Excellence Organization Information Technology Billing Laboratory Procurement Service Delivery Superior Customer Experience Analytic Transparent Seamless Convenient
Slide 4: Flagship Programs and Targeted Run Rate Savings
| 4 6 Flagship Programs Opportunity Targeted Run Rate Organization Excellence Simplify organization structure & reduce management layers $80M IT Excellence Standardize & simplify systems & reduce fixed costs $65M Procurement Excellence Reduce unit cost & improve total cost of ownership $150M Service
Slide 5: Track Record of Cost Excellence
| 5 $200 $500 $700 2012 2013 2014F Delivering Run-Rate Savings $’s in Millions Track Record of Cost Excellence 6 Flagship Programs Organization Excellence IT Excellence Procurement Excellence Service Excellence Lab Excellence Billing Excellence
Slide 6: Building the Lab of the Future to Serve New England
| 6 Converge 22,000 sqft Cambridge 130,000 sqft Athena 32,000 sqft UMass 50,000 sqft Wallingford 87,000 sqft TOTAL 321,000 SQ FT Building the Lab of the Future to Serve New England
Slide 7: Building the Lab of the Future to Serve New England
| 7 Building the Lab of the Future to Serve New England Cost Per Test Converge 22,000 sqft Cambridge 130,000 sqft Athena 32,000 sqft UMass 50,000 sqft Wallingford 87,000 sqft Quality TOTAL 204,000 SQ FT REDUCTION 36% MARLBOROUGH LAB
Slide 8: Consolidated Contact Centers Improve Quality and Efficiency
| 8 61 CENTERS 41 SYSTEMS 4,272 FTEs 16 38 3,112 74% 7% 27% 2011 2014 Centralized into National Centers in Kansas, Florida and Pennsylvania Standardizing and enhancing tools and technology Benefitting from increased self-service tools Consolidated Contact Centers Improve Quality and Efficiency
Slide 9: Supply Chain Management
| 9 Supply Chain Management $25M Platform Standardization Women’s Health HIV Auto-Chemistry $60M Pre-Analytic Consumables Standard Specification SKU Reduction Global Sourcing Supplier Engagement Design Feedback Reliability and Uptime Reagent Utilization 20 Suppliers 6 Summits 2 Development Programs
Slide 10: Identifying Key Opportunities to Meet our New $600M Goal
| 10 Identifying Key Opportunities to Meet our New $600M Goal $600M • Process • Data • Systems Standardizing the Model • eOrder • eBill • ePickup • eCare • eResult eEnabling Services • ezPay • Notification • Open Balance • Upfront Payment • Convenient Options Getting Paid for What We Do Changing How
Slide 11: Standardization of Process, Information Technology and Equipment
| 11 Standardization of Process, Information Technology and Equipment Seamless Flow From Patient Draw To Final Result Enabled by Standard Systems, Technology and Process Information & Data Multiple Lab Systems Limits ability to move specimens Disconnected client, test and patient data Standardize En
Slide 12: eEnablement Brings Convenience, Quality and Efficiency
| 12 eEnablement Brings Convenience, Quality and Efficiency Too Many! Paper Orders >15k Pickup Calls >15k Results Calls >5M Pages Printed/Faxed Too High! Invoicing Costs
Slide 13: Getting Paid for What We Do
| 13 Getting Paid for What We Do Today Test Ordering Payment for Service New Test Introduction Tomorrow Uncertain medical coverage Uncertainty on patient payment Known medical coverage Patient acknowledgment to pay Voluntary upfront payments Estimated charges Real-time adjudication Payment at time o
Slide 14: Building a Superior Customer Experience & Lowering Cost
| 14 Building a Superior Customer Experience & Lowering Cost Organization Information Technology Billing Laboratory Procurement Service Delivery Cost Excellence $600M Over Three Years Superior Customer Experience Analytic Transparent Seamless Convenient
Slide 15: Key Takeaways
| 15 Key Takeaways Track record of cost excellence Prior focus was on consolidating footprint and supply chain management Future focus on standardization and e-enablement Building a superior customer experience and lowering cost