Choosing Cost Reduction Strategies for 2009 - Hospital Healthcare Supply Chain

An article in the Hospital Materials Management newsletter predicts that GPO pricing will be going up in 2009 by as much 3.6%, even with the decrease in oil prices. Therefore, if you are looking to reduce your supply expenses in 2009 with your GPO contracts this isn’t a strategy you can count on to accomplish this goal.

That’s why when choosing strategies for cost reduction for 2009; you should be looking for inflation proof stratagems to keep your cost down permanently, not episodically. Here are some recommendations:

Since things change and people change, the products, services and technology that you are buying today aren’t being employed the same way that they were where when you first specified them 5, 7 or even 13 years ago. That’s why you can dramatically reduce your cost on almost everything you buy by re-specifying your customer’s exact requirements today.

We are finding there is an unclaimed gold mine in all hospitals purchase service contracts, if only hospitals would start to trend, track and benchmark these high ticket purchases. Just recently, we identified a $4 million plus (i.e., 26.4%) savings opportunities in a client’s total purchase service spend. This dramatic case study should alert your attention to focus on the supply chain operational area. Paying more mindful attention to this could equate to huge savings.

I can’t emphasis enough that your hospital’s supply utilization misalignments is another virgin area of your supply chain operations that has been overlooked, neglected, or ignored for years. This is where 79% of your new savings could be coming from in the future. Don’t wait any longer to tap into these huge unending steams of savings opportunities.

So when you are choosing your strategies for cost reduction in 2009 don’t overlook these three inflation proof Savings Beyond Price™ stratagems that will boost your savings yield by 3%, 7% or even 15% in less than 12 to 18 months.

P..S. If you want to know more about how to master your purchase service contracts why not check out my article “The Last Frontier in Supply Chain Management” in the December 2008 issue of HPN magazine.

Are You Ready to Open Up a Whole New World of Supply Chain Savings That You Never Imagined Would Be Possible Before?

Do you need to pinpoint where your supply utilization savings are hiding?

The term radar (radio detection and ranging) was coined in 1941, to describe a new technology that detected the altitude, direction and speed of fixed and movable objects, such as airplanes, ships, motor vehicles, weather and terrain.

Radar worked so well in WWII that it is credited as one of the reasons the Allies won the war.

What makes radar so powerful is that it can pinpoint the exact location of something even when other search methods have failed.

Now, take the radar analogy and apply it to your healthcare organization. The bottom line is that price is no longer king, and we’re in turbulent economic times. You NEED something to help you pinpoint where your savings are hiding if you’re to meet your benchmarks and savings goals.

That’s where our Utilizer™ Dashboard comes to the rescue!

You’ve got to attack unnecessary spending!

Just the other day, a material manager (MM) told me that she oversees 26,000 products, services and technologies, but has no way of knowing which are out of cost control at any given time. As a supply chain professional, you know what that’s like. You must hold your total supply cost to the absolute minimum—and doing this requires vigilance.

There’s no better way to be on the lookout for savings opportunities than with your own supply chain radar! The Utilizer™ Dashboard is exactly that! It will help you detect the waste, inefficiencies, misuse, misapplication and value mismatches in your supply chain before they inflict serious damage to your bottom line. Some of these misuses and mismatches are costing your healthcare organization anywhere from four to 11 percent in lost savings opportunities every month, quarter and year you continue to fly blind.

This savings computes to 1 or 2 million dollars per 100 occupied beds. So if you have 180-occupied beds, this could mean 1.8 million to 2.8 million going right to your bottom line—which isn’t small change when you consider that your price savings are disappearing every day.

Utilizer™ Dashboard is Fast, Easy, Efficient Radar—We Do the Heavy Lifting!

Because supply chain professionals have such limited time, it’s critical that when value analysis tools are employed, they provide a high ROI and require very little time and effort to be deployed by supply chain managers. To our delight, that’s exactly how our new Utilizer™ works. We do ALL the heavy lifting, and you reap all the savings.

You Get More with the Utlizer™ Dashboard, Including Training in an

Award-Winning Value Analysis Program

When you use the Utilizer™ Dashboard, you aren’t just getting a software program and a “Best of luck,” from us. We want you to succeed and see the value in this revolutionary program, so included in your purchase of the Utlizer™ Dashboard is a FREE Advisory Service that guides you through the implementation process to quickly and easily make your savings happen!

As a bonus, we will also train your value analysis team in our award-winning advanced value analysis training program to smooth the road to change for you. You’ve got nothing to lose and everything to gain, so give us a call today and start seeing immediate savings opportunities with the Utilizer™ Dashboard.

What People Are Saying about the Utilizer™ Dashboard

“I thought the Utilizer™ Dashboard would require more time—that I didn’t have—to manage it. To my surprise SVAH, as promised, did all the heavy lifting and showed me where my savings were hidden, which actually saved me time. ”

“I believe that the Utilizer™ Dashboard is the right product at the right time at the right cost to drive out all of my supply chain waste.”

Quickly Schedule Your “Test Drive” Today!

Yes, call me to schedule my “Test Drive” today so I can see for myself the UTILIZER™ Dashboard in action and find out how I can take my supply chain to the next level of savings performance.