Value Analysis Non-Salary Expense Reduction Supply Chain Management Savings

Strategic Value Analysis In Healthcare
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SPANNING THREE DECADES OF VALUE MANAGEMENT LEADERSHIP

March 20, 2003

When You Are Sure You’ve Saved Everything You Can, Then You Haven’t Looked Hard Enough!

Robert T. Yokl - President - The HCP Group, Ltd.

“Things Change And People Change In Healthcare Organizations Every Day, Every Week and Every Year, Thus, Giving Supply Chain Managers Unlimited And Endless Opportunities For Continuous Savings”

One of the top three challenges I hear when I speak to supply chain managers is that they don’t know where their next BIG savings are coming from since they have picked all of the ripe fruit in their vineyard. What I tell these colleagues is that just like a vineyard that has been harvested every year, the vineyard blooms bountifully and ripens again next year. It is the same with healthcare organizations, “things change and people change” every day, every week and every year, thus, giving supply chain managers unlimited and endless opportunities for continuous savings.

Where Can These Unlimited And Endless Opportunities Be Found?

I have listed below 13 Strategic Value Analysis™ candidates, so you can get started looking for the ripe fruit in your health care organization that will give you unlimited and endless savings year in and year out without fail.

STRATEGIC VALUE ANALYSIS CANDIDATES	WHAT TO LOOK FOR...
Large Dollar Expenditures	Products, Services or Technologies with an annual value of $25,000 or more.
Vendor Recommendations	Review brochures, catalogs, samples from vendors to cull new savings ideas.
Magazine Articles On Savings Opportunities	Call article authors to find out exactly how they did it. They will be happy to help you out without a fee.
New or Changes in Regulations	Most new or proposed changes in regulations costs can be reduced through Strategic Value Analysis.
Benchmarking	What are other healthcare organizations doing to save money?
Any Disposable Product	Can you return to reusable products or use reposables, or recycle?
Any Type of Custom Kit or Tray	Contents of kits and trays should be fully investigated for their value!
New Technology	In addition to the cost of the new technology there is always the add-on cost of labor and supplies that must be value justified.
High Utilization	Any Product, Service or Technology that has a high utilization cost is a candidate for study.
Product Recalls	Value Team should be empowered to investigate why the product was recalled and the corrective action required to bring into conformity.
Bundled Products	Products like IV Starter Kits, Admission Kits, etc., need to be value justified.
New Clinical and Administrative Employees	Interview new employees for great savings ideas they have been exposed to at other healthcare organizations.
Old Technology	Old technologies tend to be wasteful and costly and should be evaluated for appropriateness.

One Last BIG Savings Idea To Keep Your Savings Flowing

If you are looking for only one BIG IDEA to keep your healthcare organization’s savings flowing, I would recommend establishing quarterly and annual vendor awards for the best savings idea submitted to you quarterly. Then give a BIG AWARD annually for the best savings idea overall. The award could be a plaque inscribed, “ Robert T. Jones, Sales Representative, Chicago Business Forms, Valued Partner Of The Year Award, Presented in Recognition of Your Innovative and Collaborative Efforts With the XYX Hospital’s Value-Added Partner Program”.

Now here is the KEY TO SUCCESS with this vendor reward and recognition program. The award MUST be given at an awards luncheon or dinner attended by your executive management team and all of your vendors and their bosses. I guarantee you that this type of vendor rewards and recognition program, which will only cost you the cost of a plaque and a luncheon, will light a FIRE under your vendors to save money for your healthcare organization. Why? Because sales representatives are the most competitive breed in business today. They strive to beat their competition not once but all the time, so why not use this most basic element of motivational psychology to keep your savings flowing in your direction continuously.

Robert T. Yokl, President, The HCP Group, Ltd., has over 35 years of experience as a consultant and manager in the field of Supply/Value Chain Management and is one of the country's leading healthcare experts in value analysis, value engineering and materials management. He is the developer and program leader of the award winning Certified Value Analysis Practitioner Training Program™. Mr. Yokl is also the developer of the healthcare industry's leading ValueNetCentral™ Value Analysis Software. Over the past two decades he has trained thousands of healthcare managers in his patented Strategic Value Analysis™ and Team-Based Project Management™ processes and has assisted scores of organizations in developing their own value management programs. He has published six books, videos and audios on supply/value chain management. His latest book being, “ Strategic Value Analysis™: The #1 Smart Strategy for Taking Cost Out of a Healthcare Organizations’ Supply/Value Chain”.

Advancing Healthcare Organizations to the Next Level of Supply Chain Savings^TM