Why Does Value Analysis Fail at Some Hospitals, Systems or IDNs?
Value analysis is a best practice in 93% of hospitals, systems and IDNs in the country today, but why do so many VA programs fail to reach their full potential and reap the complete benefits of this supply chain discipline? To answer this question, I have prepared a FIVE point check list that you can use to measure your own VA program against to see if it is meets, exceeds or is missing the grade:
Steering Committee
If you don’t have a value analysis steering committee, chaired by the highest level of management you can recruit for this position, who will guide, monitor and arbitrate disputes in your VA program, then you are missing a key ingredient to your VA program’s success.
Balanced Scorecard
What is visualized and measured happens should be the mantra for your VA program. This is best achieved with a balanced scorecard that measures in real-time your savings vs. goals, milestones, meeting attendance, team and project status, etc.
Executive Champion
No real progress can be made with your VA Team(s) without an executive champion being assigned as an administrative representative to your VA team(s). This individual’s job is to represent senior management, guide VA process, arbitrate disputes, remove road blocks and smooth the road when political impasses arise.
Extensive Training
Team leaders and team members need extensive training in value analysis (it is a real discipline like LEAN Six Sigma that has a defined process, practices, tactics and techniques), or your VA team leaders and members will just WING IT, resulting in poor or unrealized savings and quality improvements.
Project Management
All team members need to be accountable for their results. This can only be accomplished by assigning VA studies to individual project managers who then are responsible for defining, planning, investigating and implementing VA savings opportunities.
As you can see by this checklist, value analysis isn’t a group of individuals meeting monthly to discuss new product introductions, GPO contracts, or product failures. It’s a formal and disciplined process that requires executive management leadership, continuous measurement, monitoring and control, extensive training and stringent project management to be successful.
If you are missing any of these ingredients, you are forfeiting the opportunity to be the “best” of the best in value analysis. Don’t leave these success elements to chance, but instead incorporate them into your current VA program so you can be assured of success – not failure!
