Strategic Value Analysis® in Healthcare

Dramatically Improve Quality While Reducing Supply Costs


Did You Know...?

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.

Podcast Healthcare supply consulting

Savings Beyond Price -Weekly eNewsletter- March 28, 2007

Robert T Yokl - Healthcare Supply Chain Consultant Strategic Value AnalysisRobert T. Yokl

President & Chief Value Strategist




What is your definition of value analysis? 

When you orient a new value analysis team member how do you define value analysis to them? Do you tell them that it is 16 department heads meeting monthly to review and approve new GPO contracts and/or new product, service and technology requests?

Or, do you tell them value analysis is a function-oriented, systematic team approach for providing, designing or investigating the right functions (primary, secondary and aesthetic) for the millions of dollars of products, services and technologies that are required to operate your healthcare organization?

My point here is by redefining your meaning of value analysis, you can begin to create a value-based culture that does a lot more then just review and approve your GPO contracts and new product, service and technology requests. It will unleash improvements in your cost, quality and efficiency that you didn’t think were possible or doable.

When our clients realize, after they have received advanced value analysis training that they haven’t been practicing value analysis at all, but doing something else instead, in less then 90 days they increase their savings yield by 3, 4, or even 6 times what they had previous were able to accomplish.  

Isn’t this how you would like to define your value analysis team process to your new team member too?

Your Partner in Supply Chain Savings,

Robert T. Yokl

President & Chief Value Strategist

P.S.  If you are looking to redefine and improve your savings yield by 3x, 4x or even 6x, why don’t you check out our advanced value analysis programs today!  


Six Steps To Keeping Your Value Analysis Pipeline Full!


“Finding and selecting the right value analysis projects is crucial to your success”

I know from personal experience that keeping your value analysis pipeline full is almost a full time job for many supply chain professionals because their supply value analysis program is the savings engine that can make them look good or bad in their management’s eyes.

But it doesn’t need to be that way!

Keeping your value analysis pipeline full should be a systematic process that has defined steps that can be learned and applied consistently to produce never ending savings opportunities for your healthcare organization.  Here are six steps for keeping your value analysis pipeline full to get you started:


1.                Organize Data

By organizing your purchasing data I don’t mean that it needs to be pristine, but just usable. It does however need to be in a database so it can be sliced and diced into what I call “natural classifications”. Or, like items need to be lumped together (e.g. pacemakers, dressings, stents, syringes and needles, oxisensors, drapes, etc.), so they can be measured, evaluated and analyzed.


2.                Establish A Baseline

Once you have organized your purchasing data into “natural classifications”, you need to determine your cost by classification by using metrics (standard or a statistic measuring and quantifying your cost) to give you a baseline or starting point.


3.                Recognize Trends

Now that you have organized your data and established a baseline over a period of time (months, quarters and annually) you will then be able to identify unfavorable trends.  For example, your might observe that your oxisensor’s cost per patient day has jumped by 25%.  This then becomes a value analysis project for your value analysis team to determine why this is happening.


4.                Benchmark Data

The most powerful technique to save money, now that you have organized your data and measured it, is to benchmark your data against your peers. This can be accomplished by creating a peer network (hospitals in your region) to work together to perform benchmarking studies.


5.                Identify Improvements

Now that you have laid all of the ground work, you can then identify major areas for improvement based on the results of your trending and benchmarking studies that can be uncovered by analyzing your database. 


6.                Repeat On Quarterly Basis       

This six step process isn’t a one-time event, it should be repeated on a quarterly basis to find new savings opportunities that will arise because things change and people change all of the time.  This then produces new opportunities for improvement on a quarterly basis.


Based on our seven year’s experience with our UTILIZER™ Utilization Management Database, if you perform these six essential and indispensable data mining tasks you will find hundreds of new savings opportunities that will keep your value analysis pipeline full –- forevermore!

 you know these myths -- go make savings happ


Where is the utilization savings in healthcare organizations today? 

From our detailed client engagements, 77% of all remaining supply savings opportunities reside in Supply Utilization (Waste, Inefficient Use, Over-specification, Under specification, etc.).  These savings opportunities account for more than 5% to 8% of your entire supply expense budget as compared with only .5% to 1% savings in price related areas.

Hospitals and health systems have been increasingly reliant on their Peer Benchmarking Reporting which does shed some light on which department of your hospital may have savings opportunities but that is about as far as it goes!  Your C-Suite is looking at these reports and turning around and asking you to delve further into these supply categories ASAP!  But, where do you go when a benchmark tells you you can save $868,000 in your Surgical Services Suite? Or $578,998 in savings on your Med/Surg Supplies?

It's like trying to find a needle in a Haystack!

It doesn't have to be that way any longer!  SVAH has a fast an easy way to find out where all of your Utilization Savings opportunities reside without all the guess work or missed steps.  AND, these savings will literally come to you on a regular basis!

To learn more about the UtilizerTM - The Next Generation of Supply Performance Benchmarking Tool or to take a TEST DRIVE of the system call today 1-800-220-4274 or fill out the test drive form below.


Yes Please Schedule My "Test Drive" of the Utilizer TM

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