Savings Beyond Price™
Innovative Supply Savings and Quality Solutions That Work
Strategic Value Analysis® in Healthcare
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 eNewsletter- May 17, 2007
Robert T. Yokl
President & Chief Value Strategist
Greetings!
The Worst Number is One!
A business management guru named Dan Kennedy has
preached for years that the “worst number is one of anything”, which took me by surprise when I first heard this truism. Then after thinking about the implications and repercussion of the number one I totally agree with Dan Kennedy’s very big idea!
Here is the big idea! If you only buy from one distributor, are a member of only one group purchasing organization, have only one savings stream or only one source for any of the products, services and technologies that you buy, then you have significantly limited your options, alternatives and choices to maximize your savings opportunities.
Case in point! If you are only attacking your price savings and not simultaneously attacking your utilization misalignments (wasteful and inefficient consumption, misuse and misapplication of your products, services and technologies) you are missing a gigantic opportunity to save 3%, 6% or even 9% on your supply expenses.
So remember, don’t ever get caught with one of anything and you will never be trapped or pigeon holed into making an ill-fated decision.
Your Partner in Supply Chain Savings,
Robert T. Yokl
President & Chief Value Strategist
P.S. If you would like to add more quality savings baskets to your supply chain management systems and make your job easier and more strategic in the process. Why not fill out our Supply Savings Analysis Scorecard (IT'S FREE TOO!) so you can finally put the savings questions to bed once and for all?
Click here to view the scorecard
The Value Analysis Imperative
“The Low Hanging Fruit Has Been Picked, Now The Hard Work Begins”
Recent changes in your hospital’s DRG reimbursement (now with relative weights factored in for each procedure) will produce a few winners, but many losers, especially if your hospital is heavy into cardiovascular services. Consequently, your executive management will be looking to your supply chain to generate even more savings then ever before!
But don’t panic yet! Relief is on the way if your have a vibrant, energetic and productive supply value analysis program! I call this period in our industry “The Value Analysis Imperative”: When supply chain professionals will be called upon to become leaders in the battle to contain your healthcare organizations cost and quality by utilizing value analysis as their weapon of choice to win this on going war.
Time To Crank Up Your Value Analysis Teams
I recently had a phone conversation with a senior director for a hospital who told me that his boss was demanding more price savings from his supply chain department -- even though the low hanging fruit had been picked. We discussed a number of alternatives to meet his boss’s mandate and the one that stood out from all other options was that it was time for this director to crank up his value analysis teams to get the hard work done.
Just like this director, you too will be asked by your executive management (if you haven’t been asked already) to generated even more savings than ever before to help improve your hospital’s bottom line.
Price savings isn’t the answer, since the well is running dry in this area of your supply chain operations. Only with value analysis can you obtain double digit savings – almost overnight -- that your executive management is looking for you to make happen for them.
Need To Do More Than Just Have Good Intentions
If you want big savings to be produced by your supply value analysis program -- just having good intentions won’t do it. You will need a money-saving system to drive all of the waste and inefficiency out of your value chain. A system that is repeatable, measurable and auditable!
Otherwise, you will be reinventing the wheel on every value study that you conduct. As a result, squandering your limited time and resources because your value analysis teams will be “winging it” as opposed to turning out big ambitious and substantial results!
Are new strategies, tactics, tools, and techniques required to dig deeper and broader for supply chain savings?
Supply
Six
Sigma
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