5 Quick Tactics for Results-Oriented Savings
In preparation for our August 28th “Offset Price Increases in Tough Times” Webinar I started thinking about five quick techniques for results-oriented savings that I could share with the attendees of this session. Now that I have these five quick techniques formulated, I thought I would list them here in my blog to give you a preview of some of the things we will be talking about in this month’s Supply Chain Best Practices series:
- Join a Regional GPO
What goes around comes around, sometimes in a big way! That’s how I feel about the hundreds of regional GPOs that are either popping up or being re-energized around the country.
If you don’t belong to a regional GPO, you are missing the opportunity to drive another 3% to 5% off your bottom line.
- Sign Multi-Year Contracts
This tactic of signing multi-year contracts (3 to 5 years vs. one year) is a little like being a broker in the futures market! That is, you are betting that the future prices you will be paying for the commodities and services that you buy will be higher than today’s prices in the future. I believe this is a “no-brainer” tactic you should implement tomorrow with the next contract that comes across you desk nothing goes down – just up!
- Perform Contract Value Analysis
The amount of fat in our purchase services contracts from my experience is enormous. Meaning, we are paying for things in our purchase service contracts that our customer’s don’t need, want or will never use. That’s why you need to perform contract value analysis on every purchase service contract that is up for renewal.
- Re-invent Your Value Analysis Teams
If you have read my August 17, 2008 Savings Beyond Price™ column on how different levels of value analysis processes create different results, then you know that 98% of healthcare organizations can greatly improve their value analysis process. In doing so, you can quickly save 4%, 7% or even 12% of your annual supply spend.
- Incentivize to Save
Very few healthcare organizations have incentivized their value analysis teams to save money, but the ones who have done so have demonstrated a ROI of 27.5x based on their original investment. Isn’t that a good enough reason for you to incentivize your value analysis teams to save too?
As I said, this is just a preview of the information we will be talking about at our August 28th webinar. If you have missed any of these 60-minute Supply Chain Best Practices webinars, you missed hearing million dollar savings ideas that we share each month with our attendees. Why not invest 60-minutes this month to save hundreds of thousands, or maybe millions of dollars with just one idea you get from this series? It will cost you nothing to do so, but the information you will receive I promise you will be priceless!
