26 minute read
How to Avoid Group Think: Why
Value Analysis Teams
How To Avoid “Group Think”!
You need to diversify your VA team’s membership to energize your team
When selecting or replacing your value analysis team membership, you need to consider the diversity of your team’s mem
bers. Do they look alike, dress alike, and think alike (i.e., homogeneous) or are they edgy, rebels, and free thinkers (i.e. heterogeneous)? The reason I ask this question is because there have been numerous studies conducted which show that if you have a homogenous group, you are in danger of “group think” or the practice of thinking or making decisions as a group in a way that discourages creativity, individual responsibility, and territoriality.
I know you have seen this “group think” behavior with your own value analysis teams over and over again. Team members don’t want to hurt someone's feelings, step on their toes, or seem to be unreasona
ble, so you “go along to get along”. Not a good busi
ness practice, if you want to make the best decisions possible at your value analysis team meetings.
Another big turnoff is a team member who is obviously protecting their turf when a decision is put on the floor for discussion. They will find every reason possible (logical or illogical) to keep their products or services from being changed. Yet,
Value Analysis Teams
no team member will challenge their positions, opinions or intransience. This is the danger of “group think”, when the desire for harmony and conformity trumps good management practices. To avoid this counterproductive, dysfunctional, and limiting group dynamics we recommend the following three new rules:
2.
3. To ensure the unbiased nature of your value analysis team composition, up to 50% of your membership should be non-clinical. For instance, if you have ten members on your value analysis team, five would be clinical and five would be
non-clinical. The non-clinical members could be recruited from finance, maintenance, food service, public relations, telecommunications, etc.
All value analysis members should be selected for their core competencies instead of by their title. We call this recruiting the usual suspects (OR and ER director, infection control manager, clinic manager, etc.) to be
members of your value analysis team instead of selecting them for their unique attitudes, talents, and traits that complement your value analysis
process.
To avoid “group think”, territorial constrains, and to lower resistance to change, value analysis project managers should have no ownership over the products, services or technologies they are investigating. Meaning, if they specify, use or have budget control over any commodity group they would be disqualified as a project manager on a project in their spear of influence.
4. Rule #3 goes for team leaders too; they shouldn’t be permitted to lead a value analysis team that is organized by product line if they have owner ship over the product line they are evaluating or investigating. For example, a director of nursing shouldn’t be a team leader for a clinical VA team.
Value Analysis Teams
The purpose for these three new rules is to structure and encourage your value analysis team members to be cooperative, have an open mind, and to look at the big picture, rather than just their department, division or subsidiary's particular selfinterest. This goal can only be achieved if there is diversity in your value analysis team membership that leads to creativity, individual responsibility, and respect.
Guide to Selecting Team Leaders and Team Members Based on Their Core Competencies
All winning teams are a combination of attitudes, talents, and traits matched with tight leadership to give them the needed vision, goals, objectives, and can-do attitude. We need team members and leaders who will take responsibility for their ac
Team Leaders
tions, and pride in their accomplishments. Over
the last two decades, SVAH has documented and observed ideal team core competencies, or what outstanding value analysis team leaders and
Motivator
Organized
Team Builder
Enthusiastic
team members do more often, in more situations, with better results, than the average performers in highly successful value analysis teams. To identify the individuals in your healthcare organization who also exhibit these same core competencies, we would suggest that you employ a 360-degree
Results Oriented
Communicator
Welcomes Challenges
Anticipates problems and resolves them
Acts as Role Model
feedback mechanism in assessing your value team leasers and team members candidates’ qualifications, prior to membership on your value analysis teams. This means that you have the candidates,
Team Members
their direct report, customers, and col
Analytical Thinker
Organized
Reliable and Dependable
Enthusiastic
leagues rate their competencies on a
scale of 1-10 prior to final selection as a value analysis leader or team member. The reason for doing so is that you only see one
Takes Initiative
Computer Literate
Welcomes Challenges
Looks for Growth and Recognition
Acts as Role Model
face of this individual, but by having them assessed by numerous individuals with whom they interact, in many different venues, you can truly identify who is the right candidate to be involved in your value analysis program.
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Value Analysis 101
Value Analysis Steering Committee:
A Value Analysis Prerequisite
In each issue of HVAM we will provide our readers with the one basic proven and time tested tenet of value analysis to assist you to refine, enhance, and advance your value analysis processes. If you have any questions on this lesson, please contact us at bobpres@strategicva.com.
We have worked with hundreds of value analysis teams over the last two decades and have discovered that the most successful high performance value analysis teams have had their CEO establish a value analysis steering committee to monitor, guide, and arbitrate disputes related to their healthcare organizationwide value analysis program. We see it as a value analysis prerequisite!
Some healthcare organizations have so-called value analysis steering committees, but they really function as value analysis teams. That’s not what we are talking about here! This committee consists of representatives from your senior management whose role is not to review and evaluate your product, service, and technology requests or GPO offerings, but to provide your value analysis team(s) with overall direction and guidance.
A typical monthly meeting agenda of a value analysis steering committee would consist of : (i) review of monthly savings report (new savings this month, savings fiscal year to date, cost avoidance, and rejected savings initiatives,
Value Analysis 101
(ii) report from team leaders on progress from last month and the challenges and opportunities they have identified, and (iii) issues that are impeding their progress.
We see the most important responsibility of this committee is to arbitrate disputes between department heads and managers and the value analysis team leadership, since this is what holds back most value analysis teams from being successful. For example, we helped a client to identify $725, 989 in telecommunications savings, but the telecommunications director at this hospital wouldn’t seriously discuss
this project with the value analysis team’s project manager assigned to this study. When this topic was brought up by the chairperson of the steering committee after being informed of this issue, she confronted the telecommunications director at the committee meeting, who didn’t have an excuse for his intransience. Fast forward one month and this savings was imple
mented and booked by the team.
This is the power of the value analysis steering committee; it can make decisions quickly that can move your value analysis projects forward, or at least put issues to bed if the committee agrees with the department head or manager position on an issue. Either way, this committee can keep the ball moving forward for you, as opposed to having roadblocks that never are removed from your value analysis team’s way.
The value analysis steering committee should be chaired by your president, executive vice president, vice president of finance or senior vice president. The reason you want the highest level of management to chair your committee is that it gives it status, decision making power, and clout. The membership of your committee should include, but not be limited to, the following members: supply chain manager, value analysis coordinator, value analysis team leaders, director of quality
Value Analysis 101
improvement, vice president of finance (if not selected as chairperson), vice president of nursing, vice president of support services, vice president of medical affairs, and a recorder. The goal here is to have the right stakeholders on your committee that can make decisions for their divisions, which can differ from facility to facility.
I can speak from experience that not having a value analysis steering committee in place to monitor, guide, and arbitrate disputes can often cover up serious deficiencies in your healthcare organization’s value analysis program. I’ve seen team
leaders avoid their responsibilities, ignore chronic problems and miss most of their team meetings. Then senior management, after many months, wonders why their value analysis team isn’t saving money. It’s all about accountability!
In the final analysis, that’s what your value analysis steering committee can do for you; hold all team leaders and team members accountable for your value analysis program’s success. Don’t miss this critical structure in your value analysis program!
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Leadership Interview
Value Analysis Leadership Interview
Alan Weintraub, Chief Procurement Officer/Director of Support Services
Enloe Medical Center, Chico, CA
The following interview was conducted by Robert W. Yokl, Managing Editor, Healthcare Value Analysis Magazine
Allan Weintraub is a 30-year supply chain veteran who is Chief Procurement officer and Director of Support Services for a multi-facility system serving a six-county region in Northern California. Allan is past-president and board member of the California Association of Healthcare Purchasing and Materials Management.
(HVAM) How did you get into value analysis?
(AW) I think it was an evolution born out of my passion for decision
making models, but certainly influenced by the works of Miles, Deming and Yokl. I was interested in better ways to make capital and consumable technology decisions than old product standardization committees could offer. I saw technology purchases merely as an input that needed to be evaluated by its effect on quality and outcomes. I felt value analysis offered a more suitable method to consider technology purchase decisions. From there, it became about crafting a model for a program that fit within the organizations’ culture.
(HVAM) When you first started
planning your value analysis program, what was your vision of how value analysis should operate at Enloe Medical Center? Was it a steep learning curve for you and your organization?
(AW) Those who were around at that time will likely tell you that I was passionately committed to certain characteristics that I felt the program must possess to be effective, evidence-based, collaborative decision
making, an emphasis on determining what technology is functionally necessary to achieve a desired quality outcome, a focus on cost of care, and the inclusion of both new technology requests and retrospective review of existing technologies; however, I wanted the program to have a certain degree of flexibility, that is, to withstand being moved to different settings (both physical and electronic). I didn’t want our program restricted to “only these individual decision-makers and only in this specific meeting”.
In addition, I wouldn’t say the learning curve was steep, but the adoption curve sure was. Our program caused us to change the way we make decisions and that didn’t happen overnight, nor did it happen without some resistance.
(HVAM) A number of years ago, you hired a value analysis coordinator to manage your value analysis program. Back then it might have been a bit forward thinking, but today
Leadership Interview
hiring a value analysis coordinator is a ”best practice” for hospitals and systems. Why do you think this is such an important position for your hospital, and why should other hospitals consider this position mission critical for their organization?
(AW) First off, let me just describe
the position at our hospital. An outstanding value analysis coordinator is a supremely talented individual that is able to speak multiple languages, possess x-ray vision along with a microscopic attention to detail, able to build bridges while standing on them, and display the skills of a UN ambassador while being outspoken. What I mean is that we are dealing with the second largest area of expense in a hospital. Numerous stakeholder groups have input in how the money is spent. Those stakeholders don’t all speak the same language, so I wanted someone with a clinical background who understood supply chain to translate between clinicians and non-clinicians, a clinical/financial liaison if you will, and focus on it every day to ensure that we maintain traction for our program. Someone who also gets up out of their seat and observes practice to understand what our clinicians are trying to accomplish…someone who sees the disconnects and wants to make a difference like I do.
(HVAM) How did you gain your senior management and department heads buy-in to your approach to value analysis?
(AW) I mentioned earlier, I was passionate about the characteristics of the program but open to what the organization’s culture would support. So, the short answer is that I sat down and talked to people - our senior leadership team, medical staff, key department leaders –and shared
what I saw as the impetus for change. We talked about the inconsistent use of items, excessive variation, the lack of consensus and clinician input into decision-making, fragmented process, unfavorable financial impacts of existing technologies, and the disconnect to quality. Once there was common ground on those items, I shared the characteris
tics I desired for the program and asked a lot of questions to determine what each leader would support in terms of commitment, structure, process, turnaround time, etc. Asking the questions I did allowed me to implement a program that fit within Enloe’s culture. From there we kept at it until it was grafted into the fabric of how we do business.
(HVAM) Could you give me an example of one or two of your most recent successes?
(AW) Our IV securement device initiative stands out due to the collaboration between our anesthesiologists, nursing staff, OR staff, radiology, and our value analysis program. It is a great example of how focusing on functional need first helped to facilitate solutions. Our stakeholders in this initiative were focused on meeting the patient care need (functionally) rather than being married to any particular manufacturer. Our annual savings will exceed $43,000. Another recent initiative focusing on reducing variation in both price and practice in orthopedics is expected to
save our organization in excess of $500,000 over the next year.
(HVAM) Can you share with me some key leadership attributes that make your value analysis program successful?
(AW)
Several things stand out. First, we hold quarterly meetings with our senior leadership team to discuss our value analysis program activities and initiatives
and any concerns we have relative to our initiatives. I will tell you that the opportunity to collectively discuss these issues with our CEO, CFO, and VP’s and make decisions together is amazing and key to our success. Second, we have great working relationships with quality management and Infection Control which I believe is essential. Third, we use a standardized scoring system to objectively rate each request. Fourth, each of the early decisions that I made –a flexi
ble, movable model, inclusion of new and existing technology review, and inclusion of Pharmacy—have all contributed to our success. Last, but certainly not least, we have an outstanding program coordinator, who is everything I described earlier and more.
(HVAM) How is your value analysis
program incorporating new disciplines within value analysis,
Leadership Interview
such as, utilization management and evidenced-based evaluation into your program?
(AW) Maybe here too, we were a bit ahead of the curve in that we’ve used a utilization benchmarking tool for several years now. Prior to using it, I felt we had a blind spot that its use helps resolve. We also consider studies and market data, when avail
able and reliable, to drive evidencebased decision-making (often shying away from early adoption of new consumable and capital technologies).
(HVAM) What advice would you give a fellow supply chain leader if they were looking to take the plunge into a comprehensive value analysis program?
(AW) Ensure senior leadership support, hire the right coordinator, be careful to exercise relational (rather than positional) power, understand your culture, and don’t worry about whether your structure matches what you may see in a magazine article. Value analysis is a methodology –how you apply it depends on you and your organization.
(HVAM) How do you envision the impact of value analysis moving forward in the age of the Affordable Care Act dramatically effecting hospitals’ bottom lines?
(AW) The ACA is a very complex issue which many are struggling to understand. Since I don’t possess the crystal ball that gives me the answers, my approach is simple. I believe that our ability to control expenses and reduce cost of care may be the difference between those that make it and those that don’t. Unless or until I find a methodology more effective than value analysis, I’m sticking with value analysis.
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Bill Baecker, CFO, Clinton Memorial Hospital, Wilmington, Ohio
Most healthcare organizations are “hitting the wall” on their VA saving because their value analysis teams or committees have been too informal, unstructured, and free form to get the job done. To move to the next level of savings performance, your value analysis program will need to have new rules, new systems, and a new operational model to generate new and long-lasting performance. Why not have the healthcare leader in value analysis teach, guide, and assist you to “up your value analysis game”. Just click on the box below to obtain even more information on this game changer.
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Value Analysis Techniques
Did You Know That Standardization Can Cost You Money?
Not all standardization is good for your healthcare organization’s bottom line
For over 40+ years, the healthcare supply chain industry has espoused standardization as a technique of choice for reducing and controlling their costs. I cannot argue that if implemented strategically this will definitely reduce your supply costs. Unfortunately, we have seen hundreds of supply chain organizations over-standardizing because of the scope of their standardization practices. Consequently, this practice ends up costing you more than you are saving, and you may not even realize this is occurring.
Best Practice
To give you more insight into this thinking, let’s define the true benefit of standardization as a best practice: Standardization is the consolidation of vendors and/or
manufacturers of defined product/service categories with
the goal of gaining the most economy of scale to render a better negotiable price and/or contract terms. A simple example of this practice would be consolidating your Peripherally Inserted Central Catheters (PICC Lines) to one manufacturer, which will give you the highest group purchasing contract tier to achieve “Best Price” in this category of purchase. On the surface this looks like a great price strategy,
Value Analysis Techniques
but here’s the problem that has been created by this tactic; most hospitals, systems, and IDN’s decide to go one step further and standardize on the PICC lines that the customers will use house-wide to one primary triple port PICC line on the manufacturer’s contract offering. Their thinking is that this one PICC line would cover all of your customers’ needs throughout their healthcare organization. This is what we call overstandardization. Does this thinking really benefit your bottom line?
New Tactic
First off, there is no additional economy of scale that you will receive by consolidating inside a manufacturer’s contract by doing this, since you have already consolidated your volume to the one manufacturer and gained your best price. You may think that you are keeping inventory lines to a minimum, but does that really equate to a measurable advantage? Even worse, with this PICC lines’ standardization example you now have standardized to a triple port PICC line, when the majority of the time your patients only require a single or dual port, but the only option your PICC nurses have
is an expensive triple port line. This equates to 13% to 32% of unused PICC line features being wasted 53% to 71% of the time. The question you must ask yourself is why knowingly throw away 13% to 32% of your PICC lines’ cost/value, representing tens of thousands of dollars annually, especially when it is not clinically required?
The lesson to be learned here is that your triple port PICC line will cover all of your clinical bases but you are wasting the value of this particular product. Keep in mind that the goal of value analysis is to find these gaps and close them to make sure that you are only using the exact product with the right configuration at the right time.
Customization vs. Standardization
The solution to this over-standardization problem is to look at customizing your PICC lines (and other commodities) within the manufacturer’s product mix, instead of standardizing on one PICC line.
To this end, find out through observations and interviews what your nursing floors/
departments unique PICC line requirements are, and then just buy what they absolutely need no more or less. Then, establish standards for each nursing floor/ department. (e.g., ICU –dual and triple PICC lines; ED–single and dual; 4 Tower North –single line, etc.) to build your purchasing specifications. Next, follow up with training programs in the proper use of each of these PICC catheters. The goal in doing these three steps is to eliminate the wasted and costly feature gaps to ensure that you are only using what you absolutely need, not only in PICC lines but all products and services organization wide. Further, make sure you are utilizing every penny/dollar you pay for each and every product/service you buy, since waste and inefficiency is no longer an option!
Ignoring A Customer In Your Value Analysis Process Can And Will Destroy Your Credibility
When we teach our clients’ value analysis team members in our LEAN Value Analysis Program about the “Hierarchy of Customers” (internal and external), we start out by focusing on the obvious customer who is anyone who touches the product, service or technology through its life cycle.
However, we also talk about the importance of identifying stakeholders (anyone who can block or influence your initiative) and experts (know more than any other person about the product, service or technology), because if you ignore any one of these customer classifications in your value analysis process, you can and will destroy your credibility.
I cannot tell you how many times we see value analysis project managers forget to communicate with their key customers and stakeholders in new product evaluations that their value analysis team has approved for purchase. Then, through happenstance, they find out that these customers and stakeholders were using the product improperly and wastefully, not to mention upset that they were not involved in the value analysis process of their product. These misunderstandings are quite an embarrassment for value analysis teams when the key customers and stakeholders find out (and they will find out) that they were omitted from their product’s value analysis process.
I can’t think of any one thing that can terminate a value analysis study more rapidly than missing or ignoring a key customer in your value analysis process. This mistake happens most often because at the start of their project, value analysis project managers don’t map out (on paper) who their customers, stakeholders, and experts are in their value analysis study. Don’t make this same mistake!
All it takes to avoid this fatal error is to ask these three questions: Who touches the product, service or technology through its life cy
cle, who can block or influence this initiative, and who knows more about the product, service or technology than any other person. By conducting this short exercise, you can be assured that you won’t miss a customer, stakeholder or expert in your value analysis
If you are honest, the answer is nobody!
If not now, when?
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