Strategic Value Analysis® Healthcare
Dramatically Improve Quality While Reducing Supply Costs
FREE Weekly Tips And Ideas
SIGN UP TODAY
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 5, 2006
Robert T.
Yokl
President & Chief Value Strategist
Greetings!
Follow The Rules, Or Don’t Call It Value Analysis!
We have a practice in healthcare of calling almost anything and everything that has to do with saving money value analysis. This is exactly the same as calling the sport of football – baseball, because there are completely different rules and objectives for each of these games!
Most healthcare organizations will say they are doing value analysis, but what they are really doing is GPO contract evaluations, price shopping, standardization or product evaluations. This is not value analysis!
If you want to call what you doing value analysis, then you need to follow the specific rules of this 61 year old savings and quality methodology or don’t call it value analysis.
If you do decide to follow the rules of value analysis you will find that your savings yield will increase 10-fold and you will have much better quality outcomes than ever before.
Your Partner in Supply Chain Savings,
Robert T. Yokl
President & Chief Value Strategist
P.S. If you want to get it right with value analysis then I would suggest that you read my White Paper, “Strategic Value Analysis: Savings Beyond Price."
Building A Culture Of Accountability With Supply Six Sigma™: The Next Generation Value Analysis Model
“Nothing Important or Long Lasting Happens Without A Culture Of Accountability”
If I see one major flaw in the traditional value analysis model it is the lack of accountability by healthcare organizations’ executive management, team leaders and team members to be mutually responsible for the success of their supply value analysis program. By this I mean that everything is measured and people are held accountable for results.
From my experience, nothing important or long lasting happens without a culture of accountability. It all begins and ends with measurement!
You can’t hold people accountable if they don’t know what they are being held responsible for, answerable for, or expected to accomplish. This is why you need to measure results utilizing the tools of benchmarking. Then you will know how much supply savings is achievable at your healthcare organization not only globally, but by commodity group, service line and SKU (stock keeping unit). This way your project managers will know with certainty how much savings they are responsible for squeezing out of any project that they are working on, e.g., orthopedics, pacemakers, dressing, kits, trays, etc.
Measurement will also enable you to determine if your project managers have met their savings goals, because you will be able to audit their projects. For instance, in our Supply Six Sigma™ System if the goal of a pacemaker value study is measured and confirmed to save $22,832 going in and only $12,296 was achieved we can then audit the project to see why it came up $10,536 short of the stated measured goal. In most cases the initial measurement or benchmark was right, but the project manager missed steps in our Supply Six Sigma™ methodology that left this money on the table – untouched.
This isn’t the end of the measurement on the pacemaker project! The project manager also is responsible for developing a control chart for the project to make sure, through on going monitoring, that the pacemaker cost and variation continues to be within acceptable limits -- going forward.
This is just one way to build a culture of accountability for your supply value analysis program, but not the only one. It also requires discipline, inspired leadership and tracking systems to keep your project managers on budget, on time and on target to achieve your stated goals and objectives. This re-channeling of your efforts is well worth your the time and energy because when you build a culture of accountability you will find that it takes less time and effort to sustain it, nurture it and maintain it.
DID YOU KNOW…
DMAIC (Duh-May-Ick) refers to a data-driven quality strategy for improving processes, and is an integral part of the company's Six Sigma Quality Initiative. DMAIC is an acronym for five interconnected phases: Define, Measure, Analyze, Improve, and Control.
© 2006 - The Strategic Value Analysis in Healthcare, P.O. Box 939, 3887 Skippack, Pike, Skippack, PA 1-800-220-4271
About SVAH - Blog - Press Releases - Events & Speaking Engagements - Case Studies and Success Stories - General Hospital Consulting and Supply Chain Management - Value Analysis University - Best Price Analysis - Supply Chain Scorecard and Dashboard - Supply Six Sigma - Strategic Planning - Value Analysis Software - Value Analysis Services - Healthcare Supply Expense Reduction and Analysis - Value Analysis Team Training Programs - Supply Chain Best Practice Series TeleSeminars Savings Beyond Price Newsletter - Strategic Value Analysis in Healthcare White Papers - FREE Savings Beyond Price Weekly Newsletter - Archived Weekly Value Analysis Articles - Contact Us