AVpresentation.pptx
Televets
A telemedicine branch of ethos veterinary health
Giselle Healy
MBA 705
October 25, 2020
What is Veterinary Telehealth?
Why is it important to talk about in the veterinary industry now?
Will it be successful and profitable as an intrapreneurial investment?
What is the value of this service to the pet owner?
Let’s start with Bella’s story to explain
Imagine you’re the proud new owner of this puppy
Lets go through a few scenarios to show the value of veterinary telehealth
Bella Doesn’t Feel well Today – Scenario one
She won’t eat, doesn’t want her walk, you’re worried
Your vet can’t see her today but it could be an emergency situation
The ER clinic tells you it will be at least a 3 hour wait?!
You have a busy day, that won’t work
Now what?
Bella Doesn’t Feel well Today – Scenario Two
She won’t eat, doesn’t want her walk, you’re worried
Your vet tells you they know the ER clinic will be a long wait if you go there physically
But they have a telehealth slot for the radiologist!
Or you can have a telehealth visit with an ER doctor
Now you can help Bella and get back to your busy day
What about ongoing care?
That Bella, she’s trouble, and she keeps having off and on bouts of this not eating, vomiting, and now maybe some diarrhea. It’s such a hassle.
You call your vet and they think from the ultrasound results she might have Irritable Bowel Disease or IBD and she needs a consult with an internal medicine specialist. But that ER/Specialty hospital nearby doesn’t have a consult for a month. You can’t do this for a month!
But your vet calls and says, next week we’re going to do a visit with the Internist video calling in while I do my exam with you and Bella and they can tell us what we should do in the meantime to treat Bella so she stops making a mess of your house.
And after that initial visit you have in a month the internist can video call you from home for the follow ups so you don’t have to drive in each time. How convenient!
Which Scenario is better to you as a pet owner?
Is the first scenario or one of the second two options more appealing to you as a pet owner?
Would you remember that service and go back to it again if you needed further care for Bella in the future?
Would you tell your friends and family about this experience in a positive or negative way?
Would it help alleviate your stress over your pet’s care along with balancing your home life?
This is the value of veterinary telehealth
Opportunity for Telehealth
Veterinary industry consolidation
Retirees and new generation of veterinarians’ viewpoints
Veterinary schooling debt
Supply and demand of qualified support
Changes in workflows from pandemic adaptations
Debt to Income Ratio 1996-2010
https://www.whitecoatinvestor.com/veterinarian-student-loan-debt/
Market and Competition
Well positioned with network of hospitals
Some standalone services, none with distinction of their own network
Industry ripe for disruption
Necessity from current pandemic changes and allowances from AVMA
Innovative service offering
Strategic differentiator for both consumers and staff
Required Resources
People the largest resource
IT next largest portion
Physical and Inventory minimal
Online service allows for less of each
Resource Type People IT Physical Inventories 8.200000000000001 3.2 1.4 1.2
Implementation Schedule
Collaboration of functional areas of corporate and hospital leadership
Six key sections
National & Local Leadership
Overall Structure
Medical Leadership
SOPs & Compliance
Finance consulted
Cost structure
Salaries
Forecasting and all other budgeting requirements
Recruitment by HR
Both internal and external for veterinarians assisted by the appropriate functional area for the staff adds
IT operations
Development of the software, integrations, and implementations
Marketing
Internal and external communication plans and marketing campaigns
collect and report data from feedback loops and relay to operational and IT teams
| Task | Project Timeframe | Group Performing | Sponsor |
| Overall Structure | Months 0-6 | Ops - National | Ops - National |
| Cost Structure | Months 0-6 | Finance | Ops - National |
| Medical Operations | Months 2-8 | Ops - Medical | Ops - National |
| IT Operations | Months 2-8 | IT | Ops - National |
| Recruit IT Team | Months 3-6 | HR & IT | Ops - National |
| Develop App & Integrations | Months 6-18 | IT | Ops - National |
| Recruit Medical | Months 6-10 | HR & Ops – Medical | Ops - National |
| Communication & Change Management Plan Development | Months 6-10 | Marketing & Ops - Local | Ops - National |
| Internal Marketing & Change Management Plan Development | Months 7-10 | Marketing & Ops - Local | Ops - National |
| External Marketing Plan Development | Months 7-10 | Marketing & Ops - Local | Ops - National |
| Internal Marketing Campaign Launch | Months 12-18 | Ops - Local | Ops - National |
| Checkpoint Team Response | Month 18 | Marketing & Ops - Local | Ops - National |
36-month Project Task Assignment, Sponsor, and Timeframe
| Task | Project Timeframe | Group Performing | Sponsor |
| Recruit Support Staff | Months 18-22 | HR & Ops –Local | Ops - National |
| Train Internal Users on Application | Months 20-24 | IT & Ops –Local | Ops - National |
| Gain User Feedback Internal | Months 20-24 | IT & Ops –Local | Ops - National |
| External Marketing Campaign | Months 22-26 | Marketing & Ops - Local | Ops - National |
| Soft Launch | Months 26-30 | IT & Ops - Local | Ops - National |
| Gain User Feedback External | Months 26-30 | Marketing & IT | Ops - National |
| Adjust Application Based on User Feedback | Months 26-32 | IT | Ops - National |
| Final Checkpoint & Reinforcement of Change | Months 32-34 | All Functional Areas | Ops - National |
| Final Adjustments | Months 32-34 | All Functional Areas | Ops - National |
| Final Launch | Month 34-36 | All Functional Areas | Ops - National |
Key Roles and Responsibilities
The national operations team will define the overall structure of the project plan and business goals for the new service.
This will include setting KPIs, budget targets, and delegating tasks to the appropriate team leads.
This will require individuals with historical business and industry knowledge, an understanding of the competitive market, and understanding how to identify the best team members for delegation of tasks.
Finance (CFO) all budget targets
Will consult on current status of cash flows, available funding, and financing options to execute this project.
Key Roles and Responsibilities
Local team leadership will collaborate with the regional leadership to help select the best departments and team members to help champion this service.
The Hospital Director will collaborate with Service Managers
Staffing, day to day operations, service profile, and equipment needs
Primary hiring conversations and decision for clinicians that will begin this service
They will need to have skills in understanding their unique department workflows, the personalities of their key staff members to select the best options for champions, and strong people management skills to properly manage the added challenge of a remote employee.
Upon successful completion of the service roll out the author will be the lead in managing the service
Defining and overseeing the roles of the clinical staff and non-clinical support staff throughout the life of the service
Key Roles and Responsibilities
Medical
Local Medical Director and Associate Medical Directors will collaborate with Regional Medical Director to develop standard operating procedures for the medical team members who will be working in this service.
All compliance standards for AVMA, FDA, DEA and local state regulations
IT
The CIO large part of the initial phase of planning with the operations teams on the national level.
Branch off to working with their own team and HR
Identify the right internal team members and recruit the right external candidates for the development and integration of the new platform
New team members will report to the CIO during the initial phases of development
Teach local IT team members program features, troubleshooting, future support
Company Profile and Core Competencies
Mission and Vision
Innovation
Advancing medical standards
Built upon Collaboration
Level 1 Emergency and Critical Care Hospital Standards
Continuous Learning and Development
Learning and Development
Ethos Discovery
Care for employees and community
Budget and Finances
| Startup Costs | Cost | Notes |
| Research and Development | $30,000 | Client and staff surveys, adaptation of current application or development of a new program to fit needs |
| Application Engineering/integration | $50,000 | |
| Software | $50,000 | |
| Programing | $50,000 | |
| Salary for veterinarians | $96,200 | 3 veterinarians to start average salary of $150,000 or $85,000/y prorated for 3 months (2 specialty, 1 wellness) |
| Veterinary Support Staff | $25,000 | 3 support staff members at $16/h 7 days a week |
| Technical Support & staff training | $20,000 | 2 dedicated team members at $20/h for 3 months for 5 day/week internal IT support |
| Marketing | $10,000 | Generally, in house marketing campaigns and online ad presence |
| Legal/licensure | $5,000 | |
| Startup Assets | Cost | Notes |
| Hardware | $7,000 | dedicated workstations and headsets for veterinarians |
| $343,2000 | Total Costs |
Sourced: Healy (2020)
Proforma
Budget
The budget is done in a top-down approach and built around anticipated doctor production revenue, or top line, as the main basis for goal planning.
Direct materials expense forecast at 10% of overall revenue
Costs savings can be appreciated with remote clinicians allowing for more aggressive target at just below 9%.
Direct labor and benefits will remain the highest budgeted category of expense at 39.8%
Remote support positions budget target is set at under 12% of revenue
Doctor wages will be the highest area of monitoring as the increase in salaries for the remote doctors increase to over 28% of revenue
Preference to maintain at 27% or below
Increased revenues and costs savings in other labor and expense categories will offset the additional percentage
Capital Funding
Current Assets
Private service based business so lower current assets
Most assets on hand are fixed assets
Similar to current assets liabilities are less substantial to Ethos
Funding Sources
The primary source of funding for this project will come from current hospital revenue streams
Investment partnership with BBH
Key Assumptions
3 main assumptions
Current economic climate in the United States is favorable for business expansion within the veterinary industry
The new normal that the COVID-19 pandemic has brought on
Social, generational, and cultural viewpoints on pets as part of the family will remain
Factors impacting Success of Business Model
Pet owner’s willingness to adopt telemedicine as viable alternative to a classic visit
Internal and external marketing success on the client’s perception of value of service
Cultural views of pet care differ widely among various groups of individuals throughout the world
AVMA regulations
Economic factors impact both the veterinary community as well as the clients they serve
As a whole, the veterinary industry is dependent upon disposable income
Resurgences of the pandemic in Europe are causing concerns for further economic impacts in the United States which may lead to more unemployment
Vaccine timing
Contingency Plans
Backup staff to all key personnel
Increased focus on internal support for the hospitals within network or within the referring veterinarian community network
This can solve a few of the potential factors that may impact the success of the business model
Shift focus to rural areas where care is limited
Corporate Social Responsibility
Development of Ethos Discovery initiatives
Larger demographic of patients for trials
Care for the veterinary community
Support for one another
Campaigns against bullying and recognition of mental health issues
Even as a small business it is important to incorporate CSR practices into a business plan
Companies that successfully do so often appreciate “increased revenue gains, higher rates of recruitment success and retention, and greater lifetime value of clients” (Weiss, 2014).
In Conclusion
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Ethos has both the market power and financial resources to invest in intrapreneurial efforts to be an industry leader in telehealth
An overall strong proforma and forecast for the hospital show that targeting three key departments for expansion with telehealth services has potential to be highly profitable with minimal expense impact.
As the current model is facing its own set of roadblocks the only way to move forward is to continue to innovate to find ways to meet consumer and patient demand.
References
AVMA (2020) Telemedicine. Retrieved from https://www.avma.org/policies/telemedicine
AVMA (2020) Guidelines for Veterinary Prescription Drugs. Retrieved from https://www.avma.org/resources-tools/avma-policies/guidelines-veterinary-prescription-drugs
BBH (2019) Brown Brothers Harriman Completes Investment in Ethos Veterinary Health LLC. Retrieved from https://www.bbh.com/en-us/our-firm/news-room/news/brown-brothers-harriman-completes-investment-in-ethos-veterinary-health-llc-33684
DePietro, A. (2019) Here's How Much Veterinarians Earn In Every State. Retrieved from https://www.forbes.com/sites/andrewdepietro/2019/03/31/veterinarian-salary-state/#19edab2c1ecc
Ethos (2020) About Us. Retrieved from https://www.ethosvet.com/about-us/
Ethos (2020) Our Team. Retrieved from https://www.ethosvet.com/about-us/leadership-team/?position=executive-team
Firenze, A. (2016) 14 Skills Your App Development Team Must Have. Retrieved from https://www.ascendle.com/insight/blog/14-skills-your-app-development-team-must-have/
Glassdoor (2020) IT Support Specialist Salary. Retrieved from https://www.glassdoor.com/Salaries/it-support-specialist-salary-SRCH_KO0,21.htm
Healy, G. (2020). MBA 690 Final Project Submission. Unpublished paper, Southern New Hampshire University.
Horch, AJ (2019) Most Americans Own a Pet, But Not the Insurance 1 in 3 Faithful Companions Will Need. Retrieved from https://www.cnbc.com/2019/06/20/most-americans-own-a-pet-but-cant-afford-to-pay-their-medical-bills.html
References COntinued
Mullins, J., Walker, O. (2013). Marketing Management: A Strategic Decision-Making Approach (8th ed.). New York, NY: McGraw-Hill.
Nolen, R. S. (2018) The Corporatization of Veterinary Medicine. Retrieved from https://www.avma.org/News/JAVMANews/Pages/181201a.aspx
Parece, L. (2017) Mass Vet Recertified as Level I Emergency & Critical Care Facility. Retrieved from https://www.ethosvet.com/blog-post/mass-vet-recertified-as-level-i-emergency-critical-care-facility/
Simon, S., Balaban, S., & Doubek, J. (2019) Veterinarians are Killing Themselves. An Online Group is there to Listen and Help. Retrieved from https://www.npr.org/2019/09/07/757822004/veterinarians-are-killing-themselves-an-online-group-is-there-to-listen-and-help
Tremayne, J. (2009) Economic Euthanasia on The Rise. Retrieved from https://www.veterinarypracticenews.com/economic-euthanasia-on-the-rise/
VPN (2016) New Hospital Network Known as Ethos Veterinary Health. Retrieved from https://www.veterinarypracticenews.com/new-hospital-network-known-as-ethos-veterinary-health/
Wells, K. (2020). Vets are Using Telemedicine to Help Care for Your Pets (and Keep You Safe Too). Retrieved from https://www.nytimes.com/wirecutter/blog/online-vet-coronavirus/
Wogan, L. (2018) Support Staff Unionize at Two Veterinary Hospitals. Retrieved from https://news.vin.com/default.aspx?pid=210&Id=8607867&useobjecttypeid=10&fromVINNEWSASPX=1
Current and 5 year plan
Expanded - Separate (revenue/cost) Department with doctor production
Revenue202020212022202320242025Assumptions
Current Services1,935,0201,935,0201,935,0201,935,0201,935,0201,935,020Traditional Services
New Services787,200787,2001,027,2001,027,2001,300,800Add 2nd wellness at year 3 and third specialist at year 5
Total Revenue1,935,0202,722,2202,722,2202,962,2202,962,2203,235,820
Direct Materials270,000 193,502 193,502 193,502 193,502 193,502 10% of traditional revenue
Labor
Doctor (3-5)385,000385,000470,000470,000620,000
Support Staff (5-10)180,000180,000180,000180,000180,000Tiered support staff structure
benefits84,75084,75097,50097,500120,00015% of total labor
Total Additional Labor565,000565,000650,000650,000800,000
Gross Profit1,665,020 1,963,718 1,963,718 2,118,718 2,118,718 2,242,318
Expenses406,354 571,666 571,666 622,066 622,066 679,522 21% of revenue
Net Income1,258,666 1,392,052 1,392,052 1,496,652 1,496,652 1,562,796
Key Assumptions
New services growth trajectory will be influenced by business development/marketing resources commitment
Direct materials will not be impacted as not a traditional service profile
Administrative support staff will start as a 1:1 admin to doctor and progress to a 1:3
IT support staff with start as a 1:3 ratio and progress to 1:5
Proforma for proposed trial departments
