Value Analysis Non-Salary Expense Reduction Supply Chain Management Savings

No healthcare organization in the 21^st century can continue to do the same things and get the same “so, so” results without questioning their commitment to innovation or building an idea factory. To my thinking only through massive innovation will healthcare organizations survive and thrive in the 21^st century.

I equate healthcare organizations to the airline industry when I think of their lack of novelty, originality, and uniqueness since they are both commoditized industries which look the same and act the same no matter what hospital you visit or airline your fly in the United States. Both are holding on to their old ways and traditions which won’t bring about innovation, but only stifles it.

I had however a pleasant a surprise the other day while flying Delta airlines and I needed to change my flight. Instead of the old way of doing business -- going to the ticket counter to change my flight -- Delta has now deployed a new system of phone banks to call their ticket agents (no waiting in long lines, no dealing with overworked ticket agents and confusion along the way) to make this chore a no-brainer for Delta and me.

Couldn’t healthcare organizations employ this same concept with their admissions practices, if they had a management process to nurture, try, tweak and harness these new ideas?

Amazon, Starbucks, Proctor and Gamble, E-Bay and IBM don’t wait for new innovative products or operation breakthroughs to just happen willy nilly, they have a management process to connect and develop new ideas by design. So too would healthcare organizations if they would only follow these four basic formulas:

You must be able to think big and tackle risky goals that will set your healthcare organization light years apart from your competitors. For example, setting a financial goal, as one of our university teaching hospital systems clients has, to have a 6% margin by 2008. This will certainly stimulate your management team’s juices to start innovating, because very few healthcare organizations have ever managed to meet this goal.

When establishing teams to search for innovative ideas, Amazon’s President, Jeffery Bezon says that ,” To the degree that you can get people in teams small enough that they can be fed on two pizzas, you’ll get a lot more productivity” and ideas too!

Establishing homogeneous teams with like minded members won’t give you the diversity or heterogeneous atmosphere that is necessary to connect and develop new innovative ideas. Successful innovation teams look like a well made “salad” with a mixture of dissimilar and varied ingredients served with an appetizing dressing.

The most successful innovative organizations have engendered a “culture of discontent” or a restless desire that there is always something better than what they are doing now. They are always striving to find faster, better and smarter ways to revolutionize, reinvent, modernize, originate, transform, update, renovate, renew and remodel their work and their products, services and technologies.

As you can see by these four basic formulas, when it comes to building an idea factory having the desire to do so is only the starting point, what really works is having a management process that consistently generates new original ideas.

I have found that one of the critical tasks that healthcare executive management teams have to do as a requirement to stimulate innovations at their healthcare organizations is to tear down existing corporate and departmental pillars, walls and structures that have been holding back new ideas and original thought for decades.

A case in point: I recently ran into this problem when we installed our Strategic Value Analysis™ System for one of our clients. We found out a month or so later that a senior management executive had incorporated his old methods and practices into our new system. This happened because management was afraid to tell this executive that “the times were a changing” and he had to abandon his old ways for the new ways that were being introduced by my company to produce better results.

In summary, if healthcare executive management teams aren’t up to this challenge of breaking down corporate and departmental barriers of resistance and opposition to change, then no innovation is possible within your corporate walls. You will just keep on operating with your old ways and old traditions that you have been employing for decades and hope that no one will notice that you are operating with aging, tired and commoditized methods, practices and results. Or, maybe they will notice, and move their business to your “innovative” competitor next door or down the bock?

Strategic Value Analysis In Healthcare
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Home Weekly Strategic Value Analysis Newsletter View Archived Strategic Value Analysis Newsletters Fast Target Savings Strategic^TM Value Analysis ValueNet Central^TM Value Analysis Software Training About HCP Client List Articles and White Papers Contact HCP FREE Weekly Email How To Tips Click Here to Access the NO Obligation Free Non-Salary Survey to find out what your savings opportunities are for your organization. Free Web poll for your Web site - freepolls.com		December 17, 2004 by Robert T. Yokl, President Are You Looking For Breakthrough Innovations At Your Healthcare Organization? NEWSFLASH: They Won’t Happen Without A Management Process To Nurture, Try, Tweak and Harness Them Holding On To Old Ways And Traditions At Your Healthcare Organization Won’t Bring About Innovation, But Only Stifles It! No healthcare organization in the 21^st century can continue to do the same things and get the same “so, so” results without questioning their commitment to innovation or building an idea factory. To my thinking only through massive innovation will healthcare organizations survive and thrive in the 21^st century. I equate healthcare organizations to the airline industry when I think of their lack of novelty, originality, and uniqueness since they are both commoditized industries which look the same and act the same no matter what hospital you visit or airline your fly in the United States. Both are holding on to their old ways and traditions which won’t bring about innovation, but only stifles it. I had however a pleasant a surprise the other day while flying Delta airlines and I needed to change my flight. Instead of the old way of doing business -- going to the ticket counter to change my flight -- Delta has now deployed a new system of phone banks to call their ticket agents (no waiting in long lines, no dealing with overworked ticket agents and confusion along the way) to make this chore a no-brainer for Delta and me. Couldn’t healthcare organizations employ this same concept with their admissions practices, if they had a management process to nurture, try, tweak and harness these new ideas? Breakthrough Innovation Is All About Process Amazon, Starbucks, Proctor and Gamble, E-Bay and IBM don’t wait for new innovative products or operation breakthroughs to just happen willy nilly, they have a management process to connect and develop new ideas by design. So too would healthcare organizations if they would only follow these four basic formulas: 1. Risky Goals Matter You must be able to think big and tackle risky goals that will set your healthcare organization light years apart from your competitors. For example, setting a financial goal, as one of our university teaching hospital systems clients has, to have a 6% margin by 2008. This will certainly stimulate your management team’s juices to start innovating, because very few healthcare organizations have ever managed to meet this goal. 2. Size Matters When establishing teams to search for innovative ideas, Amazon’s President, Jeffery Bezon says that ,” To the degree that you can get people in teams small enough that they can be fed on two pizzas, you’ll get a lot more productivity” and ideas too! 3. Diversity Matters Establishing homogeneous teams with like minded members won’t give you the diversity or heterogeneous atmosphere that is necessary to connect and develop new innovative ideas. Successful innovation teams look like a well made “salad” with a mixture of dissimilar and varied ingredients served with an appetizing dressing. 4. Discontent Matters The most successful innovative organizations have engendered a “culture of discontent” or a restless desire that there is always something better than what they are doing now. They are always striving to find faster, better and smarter ways to revolutionize, reinvent, modernize, originate, transform, update, renovate, renew and remodel their work and their products, services and technologies. As you can see by these four basic formulas, when it comes to building an idea factory having the desire to do so is only the starting point, what really works is having a management process that consistently generates new original ideas. Tearing Down Corporate Walls, Pillars And Structures I have found that one of the critical tasks that healthcare executive management teams have to do as a requirement to stimulate innovations at their healthcare organizations is to tear down existing corporate and departmental pillars, walls and structures that have been holding back new ideas and original thought for decades. A case in point: I recently ran into this problem when we installed our Strategic Value Analysis™ System for one of our clients. We found out a month or so later that a senior management executive had incorporated his old methods and practices into our new system. This happened because management was afraid to tell this executive that “the times were a changing” and he had to abandon his old ways for the new ways that were being introduced by my company to produce better results. In summary, if healthcare executive management teams aren’t up to this challenge of breaking down corporate and departmental barriers of resistance and opposition to change, then no innovation is possible within your corporate walls. You will just keep on operating with your old ways and old traditions that you have been employing for decades and hope that no one will notice that you are operating with aging, tired and commoditized methods, practices and results. Or, maybe they will notice, and move their business to your “innovative” competitor next door or down the bock? About the Author 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, Non Salary Expense Reduction 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’ Healthcare Supply Value Chain”. _____________________________________________________________ COPYRIGHT 2004 - THE HCP GROUP, LTD. - ALL RIGHTS RESERVED
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