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That Value Analysis Was Developed Back In the 1940's After World War II as a Way to Find Lower Cost but Higher Quality Alternative products and methods. This was Due to the Lack of Material Resources At The End of The War.
Savings Beyond Price -Weekly E-Zine- August 2, 2006
Robert T. Yokl
President & Chief Value Strategist
Greetings!
Is it time to re-invent and re-tool what you’re doing?
Material management (or supply chain management as it is now called) has been red hot for 27 years now in healthcare, yet very few healthcare organizations have taken the time to develop a Strategic Supply Chain Operations Plan (SSCOP) to fine tune their multi-million dollar business operations. It is rare if ever that healthcare organization’s take the time to refresh their SSCOP’s to compensate for the winds of change that take place yearly AND will have a dramatic effect on your bottom line and quality outcomes as well.
Winds Of Change: One big change that is right around the corner is the new Medicare reimbursement regulations that go into effect in October and that will surely cost your hospital, system or IDN hundreds of thousands of dollars, or in many cases millions of dollars in lost revenues and will also drastically affect your bottom line.
Master Change: We in supply chain management always seem to be preoccupied when it comes to strategic operational planning. HOWEVER, planning is the best kept secret for you to be able to stay on top of your game. By looking at where you have been, where you are now and where you want (or need) to be in 1, 2, 3 or 5 years with your supply chain management program, you can manage these unpredictable winds of change more effectively.
Anticipate Change: This is the case with one of our clients whose management is telling him he needs to do more with less for which he has responded to this challenge by developing a Supply Chain Operations Plan (with our assistance). The plan includes re-inventing and re-tooling his purchasing operations and supply value analysis program to be leaner, meaner and more productive. At the same time our client is proactively increasing his supply saving yield by 11.4 times over the next few years.
If you want to be left standing when the winds of change hit your healthcare organization you need to anticipate and strategically plan for change with your own Strategic Supply Chain Operations Plan that will keep you afloat in good times and bad.
Your partner in savings,
Robert T. Yokl
President & Chief Value Strategist
P.S. We Are Making the Planning Easy for You (and no cost too) If you haven't already signed up for our No Cost Tele-Seminar for this month (August), we will help you plan your next generation of supply savings strategies, tools and methods. Learn more here!
How To Motivate Your Complacent Management To Save Money While You're Still Making Money!
"Sometimes People Won't Jump, So You Need to Push Them"
To paraphrase Jack Welch “without an impending crisis, most management teams just love the status quo”. In fact, he says that most management teams find it to be like a warm bath. They never want to get out and they certainly have no desire to jump into the icy water of change. So, how do you motivate a complacent management to save money?
As Welch says, “Sometimes people won’t jump, so you need to push them”. You push them by showing them with hard data what your organization will look like if it doesn’t change and what it will look like if it does change.
Illustration: With few exceptions all hospitals, systems and IDN’s are going to lose significant reimbursement (one hospital system I just talked to calculated their loss to be $6 million dollars annually) in October when the new weighted Medicare rules are to be implemented. On the positive side, you can show your management team that by retooling your supply value analysis program you can save $1, $2 or even $3 million dollars (you add your own numbers here) in supply savings to cushion this blow.
You then need to start a campaign to get your message across to your management team. My tactic, when I was sitting in your chair, was to write a White Paper (and request a presentation to my management team) outlining the good, the bad, and the ugly things that could happen to my healthcare organization over the next few years if we didn’t change. Then I would give my management team the good news of how my supply value analysis program, or whatever money-saving program I was utilizing at the time, could dramatically improve their bottom line by 1%, 2% or even 3% almost overnight.
My batting average, utilizing this tactic was about .800 in getting my management team to agree to my savings proposals, but it would have been about .150 if I didn’t push them to make needed changes.
You too can have the same or better batting average by motivating your complacent management team to save money when your hospital, system or IDN is making money and just loving the status quo.
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