“To customize within your standardization program, you will have to work within contracting boundaries to find lower cost alternatives that will meet your customers’ requirements exactly with equal or better reliability.”
Let’s face it, the contracting formulary that we have to work with is pretty much set by our national and regional group purchasing organizations. The goal with our contracting is to standardize volume within each of the major and minor contracting categories in order to garner the best price and/or tier level. This leaves us with only the options that our contracting formularies have given us within the standardization of vendors. But you must keep in mind that in most cases those existing vendors have many options that could offer lower cost alternatives within your standardization program. The key here is to customize your clinicians’ and non-clinicians’ unique requirements further within the available contracting product lines.
The Goal of Customization Vs. Standardization is Clear
To customize within your standardization program, you will have to work within contracting boundaries to find lower cost alternatives that will meet your customers’ requirements exactly with equal or better reliability. Fine tune the features that your customer uses 100% of the time to eliminate any waste that is costing your organization.
Value analysis is the best strategy to utilize as it is the study of function of products, services, and technologies to which everything has a function. Once you study and learn your customers’ and stakeholders’ functions then you can use their functional requirements as your specification to source lower cost alternatives. When we learn more about key product and service functions, we then can weed out waste and inefficiencies as well as the high dollar features that may only be required from time to time versus all the time.
Stay Away from the Word Quality
A word of caution: Stay away from the word quality when you go down the road for customization as it is very subjective in nature. Your vision of quality on a product may be very different than one user’s as compared to another. Don’t get caught in that trap; use function and reliability as your true guide. Does the product meet functional requirements reliably? Either the RF ablation instrument lasts the entire case, or you must use two or three for each case. I would consider using more than intended to be a waste. You may want to investigate a more reliable RF ablation instrument that still meets the required functions that the incumbent does but with the intended usage which in this case is one per case.
Savings Beyond Price is the Easy Button
Yes, we are all looking for the easy button. What I described above may seem like a lot of work, but it really isn’t as we are only recommending that you look back inside your existing contracts to find even bigger savings that were hiding from your purview. There are many ways to speed this up like utilization management and benchmarking reporting, or you can go old school and just have your VA teams do retrospective reviews on major categories. The key here is to look to customize within your standardization program. You will take your organization to the next level of major savings that you never thought was possible.
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