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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.
Savings Beyond Price -Weekly E-Zine- October 19, 2006
Robert T. Yokl
President & Chief Value Strategist
Greetings!
Are Your Focusing On Profitability Or Is It Just All About Savings?
It was once said that if you want to obtain more raises, promotions and recognition you need to be on the profit side of your business. This statement is so logical, intuitive and subtle that I think most of us could misunderstand its meaning.
That’s why your CFO’s salary is $250,000, $350,000, $450,000 or $650,000 a year and you make $50,000, $75,000, $120,000 or $180,000. When you are on the profit side of your business there is no limit on what you are paid.
You can always start your campaign for more raises, promotions and recognition by never, ever talking about savings again. A much better way would be to search out and implement the best profit improvement opportunities that you can uncover and then show your management team how this improvement has enhanced your hospital, system or IDN’s bottom line.
This change in focus from just being all about savings to being all about profitability will change the way you do business -- almost overnight. No longer will you be satisfied with small incremental improvements (hitting singles), but you will now center your attention on hitting doubles, triples and home runs. You will also start to look at the profitability of the procedures and tests that your healthcare organization is performing, so you can target them for profit improvement.
This is a new way for you to look at how you do business, but it is the only way that I know that will quickly get you on track for bigger raises, faster promotions and more recognition.
Your Partner in Supply Chain Savings,
Robert T. Yokl
President & Chief Value Strategist
P.S. If you are looking for assistance to uncovering the most profitable opportunities at your hospital, system or IDN send me an e-mail at Robert_T_Yokl@strategcvalueanalysis.com so that I can help you get a larger pay check, promotions and more recognition than you ever thought possible.
What Side Of The Profit Triangle Are You Focusing On Today?
“There Are Three Sides To The Profit Triangle: Value Creation, Internal Operations And Competitive Advantage”
Business is all about profits! It doesn’t matter if you are in show business or the healthcare business your goal must be to be increase your profits every year. Or else, you can’t possibly provide your patients with top notch – defect free -- quality care!
The best way for your hospital, system or IDN to be profitable is for supply chain professionals (and all other department heads and managers) to focus their efforts on increasing their Profit Triangle: competition, value creation and internal operations. This can be accomplished by leveraging the three sides of the Profit Triangle by:
1. Eliminating Your Competition
Every healthcare organization has competition (e.g. one hospital we work with has a for-profit clinic right next to their hospital) that you need to outperform in quality, service and price. Supply chain professionals can greatly contribute to this ongoing challenge by always having the right product, at the right place, at the right time and at their right price.
2. Creating Value Where None Existed Before
Value is created through continuous, relentless and obsessive value analysis studies to determine your customer’s exact requirements through functional analysis, and then provide them at the lowest possible cost. On the flip side, value isn’t created by having 10 or 15 department heads and managers sitting around once a month discussing new product requests or new GPO offerings.
3. Driving Out All Waste & Inefficiencies In Your Operations
Waste and inefficiency is present in all healthcare organizations that are bloating their budgets and reducing their profitability. It’s every supply chain manager’s job and responsibility to make sure your internal operations aren’t contributing to this universal problem by rooting out all of your waste and inefficiencies in your products, services and technologies value chain.
Most healthcare organizations that we work with or visit are focusing most of their energies on the competitive side of the Profit Triangle which is commendable. Yet, these efforts are only affecting one side of your healthcare organization’s Profit Triangle. If your organization is serious about striving for operational excellence and double digit profits (most hospital profits are at 4.5% today), you need to also center your attention on the other two sides of the Profit Triangle (value creation and internal operations) if you want to continue to provide top notch -- defects free -- quality care to your patients.
DID YOU KNOW…
That P.T. Barnum never said “There’s a sucker born every minute”. Actually his real philosophy was that “There’s a customer born every minute”, because Barnum always gave more value than the customer every expected when they came to any of his events, museum or circus.
© 2006 - The Strategic Value Analysis in Healthcare, P.O. Box 939, 3887 Skippack, Pike, Skippack, PA 1-800-220-4271
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