Call Me If You Need Me…WRONG!
The most common advice a VA facilitator (I hope you have one) usually gives to his or her VA team members is “Call me if you need me”. The end result is that your VA facilitator never hears from your team members for various reasons (time constraints, embarrassment, or awkwardness in asking for help) and consequently your team members never become proficient in the art and science of value analysis. This then leaves hundreds of thousands of dollars in savings on the table at your healthcare organization — untouched.
On the other hand, if you have a structured, proactive coaching approach, where a coaching schedule is followed by your VA facilitator, team leader and team members, you will improve your overall team performance by 90%. Just as important, your savings performance will improve by 2, 4 or even 6-fold over your current savings performance.
There’s a lot more to effectively coaching your value analysis team members (qualities of an effective coach, duration and content of sessions, sponsor and team leader involvement, accessibility, documentation, etc.), but we will leave these topics for other blog articles.
What the lesson learned from this blog article should be for you is that telling your team members to “Call me if you need me” is the worst advice you can give your team members. Only with a structured, proactive coaching approach can you dramatically improve your value analysis teams and team member’s performance.
Boost Your Value Teams Productivity by 87% or More!!
Are you ready to build high-performance teams that keep your project managers on track, on budget, and on target to achieve even better and faster results?
If your answer to this question is a NO, you can stop reading this column…now. However, if your answer is YES, keep reading since I’m going to share with you one little known secret of high performance value teams. A secret that will enable you to virtually guarantee successful savings implementation every time, minimize communication gaps, and optimize your team’s time, money and resources.
The secret is for you to invest in project management software that will: (i) expand your ability to manage and control all of your value analysis projects in real-time, (ii) give a tangible structure to your value analysis studies vs. winging it, (iii) expertly apply value analysis concepts to your projects, and (iv) document all projects and savings.
Just the other day I was talking to one of our IDN clients about what’s new in his supply chain world. He told me that he is now is employing project management software to manage all of his savings projects and this has boosted his project manager’s productivity by double digits.
More importantly, this supply chain professional now has piece of mind that his projects are on track, on budget and on target. Before buying the project management software he wasn’t really sure what the factual status of his projects were at any given time. All he had to base his decisions on were verbal project updates along the way.
That’s all changed now he says with just one click of his mouse he can see for himself all of his projects status reports without any filters, miscommunications or misunderstandings that have often crept into his status reports in bygone days. He now believes that only with project management software can healthcare organizations meet their strategic savings objectives each and every year. It just makes sense to do so!
Your Partner In Savings Beyond Price™,
Robert T Yokl
Chief Value Strategist
Strategic Value Analysis® In Healthcare
800-220-4274
P..S. Discover the power our Supply Chain Pilot™ can give you in the management and control of ALL of your supply chain and value analysis projects. It just makes sense to do so!
P.P.S. Don’t forget to check out my new blog article, “Stepping Up to the Supply Chain Leadership Challenge”. This blog is all about the supply chain heroes who are making a difference at their healthcare organizations every day.
Stop the Madness with Your GPO Contracts
I have been told by value analysis managers throughout the country that they spend 96% of their time evaluating new or renewal GPO contracts, which isn’t value analysis at all. When I tell them that there is only 1%, 2% or 3% savings to be achieved with their GPO contracts and, on average, 26% to be saved on any value analysis project they conduct, they soon understand that they are spending their time on the wrong side of the supply chain equation – price!
The next question I’m always asked by value analysis managers is, “How do I STOP THE MADNESS with my GPO contracts, so that I can spend the required time on my value analysis projects?” Here’s three strategies that I tell them to employ to get organized, prioritize and optimize their time to save even more:
- Start a campaign with your peers to insist that their GPOs write contracts with 3, 5 and 10 year lifecycles – not one year terms. Not only will this tactic reduce the number of GPO contract renewals, but will enable GPOs to lock in their prices over the long-term, since inflation is the real threat to price stability in the healthcare marketplace. For example, Southwest Airlines has not been affected by the current energy crisis since they locked in their fuel prices over the long-term. Your GPO can provide this same price protection for you!
- Don’t change your manufacturers just because there is a new GPO contract being offered by your GPO, because the cost of change will usually cost your more than the contract savings being offered. You can do this by searching out comparable contracts with other GPOs (yes, you might need to join more GPOs to do so), so that you can continue to purchase from your preferred manufacturer at competitive prices. Your justification: Contract churn isn’t and will never be a cost effective way to do business.
- If you are a large enough healthcare organization to do so, write long-term custom contracts with your GPOs assistance, so that you can lock in your prices for the foreseeable future.
I’m sure you can think of a few more and even better strategies to organize, prioritize and optimize the time you are now expending evaluating your GPO contracts now that I have opened Pandora’s Box. It’s my opinion, that if we don’t STOP THIS MADNESS it will have a stifling effect on your supply chain effectiveness in the sort and long-term.
If you agree or don’t agree with my take on this topic, I would love to hear your comments on this pressing problem.
Your Partner in Innovative savings,
Bob Yokl
President & Chief Value Strategist
Strategic Value Analysis® In Healthcare
800-220-4274
P.S. If you would like more powerful savings and quality ideas like this one I would recommend that you sign-up for our “no cost” weekly Savings Beyond Price™ e-Newsletter at www.Strategicva.com. You will also get a copy of my e-book “Your Target Blueprint for Supply Chain Management Success”, as a bonus.
Are You Really Practicing Value Analysis or Are You Doing Something Else? (Revisited)
I have written often about healthcare organizations’ value teams not practicing value analysis, but are instead doing something else. But what I didn’t know, until we started conducting our Certified Value Analysis Leadership Program (CVAL) in 2007, is that value analysis coordinators, managers and directors aren’t practicing value analysis either.
What I have found from my interaction with these coordinators, managers and directors, at our three-day CVAL program, is that these individuals spend most of their time evaluating new and renewal GPO contracts! That’s not value analysis at all, that’s contract management in its purest sense.
After these very intense three days of training I’m happy to report that most of the attendees at our CVAL program finally realize that they aren’t practicing value analysis and have decided that going beyond price is where they want to go in the future with their value analysis programs.
As I mentioned last week at the North Carolina Materials Management Association annual conference, hospitals should have an annual audit of their pricing, then fill in the gaps of their contract portfolio where needed. It doesn’t make sense for these individuals to spin their wheels and waste their time trying to eke out a few more percentages savings with their GPO contracts, when there is about 26% savings on just about any commodity these individuals would investigate using the techniques of value analysis.
I went on to tell the NCMMA members that they should petition their GPOs to have more 3, 5 and 10 year contracts, with annual renewals, so their members could stop the madness of trying to keep up with their new and renewal GPO contracts that are e-mailed to them daily.
Bottom Line! Value analysis coordinators, managers and directors need to get back to basics by actually practicing the tenets of value analysis and then move away from being contract managers. Contract management isn’t your job (it’s your purchasing department’s job) and it’s not what you were hired for.
It’s your job to study the functions of the products, services and technologies your hospital is buying, and then search for lower cost alternatives to meet those functions. That’s what’s missing from your value analysis program and is holding back huge savings for your hospital.
P.S. If you would like more powerful savings ideas like this one I would recommend that you sign-up for our “no cost” weekly Savings Beyond Price™ e-Newsletter at www.Strategicva.com. You will also get a copy of my e-book “Your Target Blueprint for Supply Chain Management Success”, as a bonus.
