Strategic Value Analysis In Healthcare

The era of STANDARDIZATION is ending!

I have been preaching for seven years now that there is a quiet revolution in all industries based on the concept of customization vs. standardization. Or, one size won’t fit all customer’s requirements.

I now see that this customization concept is being adopted by retailers like WalMart, Best Buy, and J.C. Penny and manufacturers like Levis, Procter and Gamble and Kraft -- BIG TIME.

Why? Although standardization has been a powerful strategy in reducing any and all for-profit or non-profit organization’s costs, it has reached the point of diminishing returns. Customers (internal and external) have become much more diverse and varied in their requirements, therefore if you don’t target in, like an archer, on their exact functional requirements you are just throwing your money down the drain with your standardization strategies and tactics.

We have been teaching this customization model to our clients for almost a decade now with outstanding results for their customers and their bottom line. On average, our clients have saved 12% to 16% on their products, services and technology purchases (beyond price) once they embrace this powerful idea.

If you would like to learn more about this concept I would suggest that you download my White Paper “Strategic Value Analysis®: Savings Beyond Price”. This White Paper will give you specific examples of how you can apply this customization model at your own hospital, system or IDN and join this quiet, but powerful revolution too.

Your Partner in Supply Chain Savings,

P.S. We are half way through the year, is it time to reenergize your team/committee with in-house value analysis training and strategic planning? SVAH has trained over 5,316 healthcare professionals in the art and science of Value Analysis.

Change Management Is A Holistic Process, Not A One Time Event!

“For Change To Be Anything But Superficial And Temporary, It Must Be Systemic...And Holistic”

Thomas A. Steward, Harvard Business Review

The more I study change management strategies and techniques the more I’m convinced that “Change Management is a Holistic process, not a one time event”. That’s why when you approach your physicians or clinicians with a new cost reduction proposal they, more often than not, reject it out of hand.

Our own experience with our clients over the last 19 years reinforces this theorem. When we are hired by a client to identify and implement supply savings for them or what I call a one time event, yes they save millions of dollars, but it’s only a superficial and temporary change. As opposed to systemic and holistic change. We know that our client will go back to their old habits in no time at all and their supply cost will revert back to where it was in just a few short years.

On the other hand, when a client retains us to install our Strategic Value Analysis® System and we train and coach their staff on how to deploy this money-savings best practice, they not only save at minimum a million dollars in less than 12 months, but they continue to save hundreds of thousands of dollars over the next 3, 5 or even 7 years. This is because the change wasn’t superficial or temporary, but a holistic change in the way their hospital, system or IDN thinks, acts and performs their value analysis studies.

If you are looking for deeper, broader, and more enduring change in your supply chain savings yields you need to adopt a systemic and holistic approach for your supply chain savings model that isn’t a one time event.

As a colleague of mine once said to me, “I’m sick and tired of making cost reduction proposals that are rarely ever accepted. I need to find a new way to make supply savings happen that my clinicians will see as natural and normal as breathing”. This should be your goal as well.