Copy to clipboard 
In the ever-evolving landscape of healthcare, achieving financial resilience has transcended being a mere objective to become an indispensable survival strategy. The healthcare sector, perennially subjected to market fluctuations, regulatory transformations and global health crises, demands of its constituents a level of service delivery that focuses on quality, patient care and staff safety.
In navigating this terrain, healthcare organizations must master the art of supply chain spend optimization, adept pricing strategies and shrewd contract negotiations that encompass a broad spectrum of products, capital equipment and purchased services. This mastery not only promises enhanced financial performance but also equips them with the resilience needed to thrive amidst inevitable disruptions.
For orthopedic companies, understanding the nuanced shifts in how hospital customers adapt to these dynamic conditions is not just beneficial — it’s critical. This article unveils a groundbreaking “360-degree” value analysis model, which serves as a beacon for forward-thinking healthcare organizations, hospitals and non-acute facilities that aim to redefine their approach to supply chain management and elevate their financial well-being. This innovative model opens a new competitive battleground for orthopedic device companies and offers fresh avenues to strengthen partnerships with their customers.
By aligning with the holistic objectives of financial health, clinical excellence, operational efficiency, resilience, sustainability and diversity, orthopedic companies can unlock their full potential for collaboration and organizational impact.
Evolving Toward Comprehensive Value Analysis
A “360-degree” value analysis program goes beyond traditional evaluation metrics. It offers an interdisciplinary view that encompasses the entirety of an organization’s purchasing decisions — from the smallest products to the most significant capital equipment and purchased services. The weaving together of multiple objectives ensures that every decision is not merely a transaction but a step toward achieving overarching strategic ambitions and values.
This paradigm shift is a clarion call for orthopedic companies to align product offerings with the multifaceted criteria now at the heart of healthcare procurement — where cost efficiency melds with quality patient care, operational excellence and a steadfast commitment to diversity and sustainable practices. This 360-degree scrutiny raises the bar for the products that make it into the healthcare ecosystem and champions social responsibility by elevating an organization’s standing in the community it serves.
While navigating this evolved value analysis landscape may seem daunting for orthopedic companies, it also opens a doorway to unparalleled growth and partnership opportunities.
360-degree Value Analysis Questions and Comprehensive Approach
Orthopedic companies must be prepared to answer the following questions about their products and operations.
Financial Impact
Healthcare organization resources: Purchasing, supply chain, strategic planning, revenue cycle management, GPO(s), supplier/vendor
- What is the annual impact on the cost of supplies or services?
- What is the impact on enterprise net revenue?
- Is the new product or service part of the patient’s insurance benefits?
- Is the new product or service codable?
- Will payers cover the new product or service?
- Is the new product or service available on GPO contract?
- Will other supplier contracts be negatively impacted?
- Is a rebate or other value-added structure available with the supplier or vendor?
Clinical Impact
Healthcare organization resources: Physician and clinician end users, supply chain, medical library, suppliers, GPO(s), supplier/vendor
- Are the new products certified by FDA or Centers for Disease Control and Prevention?
- How will the new product or service affect current clinical outcomes?
- Will the new product or service reduce variation in the delivery of care?
- Will the new product or service improve efficiency?
- What is the highest level of research supporting the product or service?
- Does the new product or service have reported adverse events?
- What potential clinical impacts or safety risks to the patient should be considered?
- Is there shared responsibility of risk with the supplier on the new product or service?
Operational Impact
Healthcare organization resources: Supply chain, physician/clinician end users, suppliers /distributors, GPO(s), supplier/vendor
- What departments and end users will be impacted?
- Will biomed, sterile processing or IT be involved?
- What regulatory concerns will be addressed?
- Will a trial of the new product or service be needed?
- Will staff education be needed?
- Will the new product involve on-site or off-site distribution?
- Will the new product help reduce inventory?
- If a product conversion is involved, how much current remaining stock will need to be used?
- Will changes be needed in other platforms, such as enterprise resource planning (ERP), materials management information system (MMIS) or electronic health record (EHR)?
Resilience Impact
Healthcare organization resources: Purchasing, supply chain, suppliers/distributors, GPO(s), supplier/vendor
- What is the supplier or vendor risk score?
- What is the supplier or vendor outage history compared to peers?
- What is the supplier or vendor incident history compared to peers?
- What is the supplier or vendor response rate to customer concerns and/or outages?
- What is the supplier or vendor backorder rate?
- What is the supplier or vendor fill rate?
Environmental Sustainability Impact
Healthcare organization resources: Purchasing, supply chain, suppliers/distributors, GPO(s), supplier/vendor
- What is the chemical transparency of the product or service being considered?
- Does the new product or service reduce patient and staff exposure to unsafe chemicals?
- Does the new product or service contribute to waste reduction efforts?
- Does the supplier or vendor have a record of environmental responsibility?
Diversity Impact
Healthcare organization resources: Purchasing, supply chain, suppliers/distributors, GPO(s), supplier/vendor
- Is the supplier or vendor a diverse business?
- Is the supplier or vendor transparent with their Tier 2 diversity data?
- Does the supplier or vendor have a record of social responsibility?
Implementing a 360-degree value analysis model does not necessarily require additional resources, but rather a realignment of existing ones. By leveraging cross-functional teams and integrating data analytics into decision-making processes, organizations can enhance their supply chain operations without significant increases in expenditure or personnel. Numerous healthcare organizations have successfully implemented similar approaches. Tailored support and phased integration strategies enable a smooth transition and ensure that the model’s breadth enhances rather than complicates decision-making processes.
How to Compete in 360-degree Value Analysis
Let’s break down what this looks like in practice.
Financial Impact
Cost-Effectiveness. Emphasize the economic value of your products, not just in terms of purchase price but also through their contribution to reducing overall treatment costs. This includes showcasing the longevity and durability of devices, which can lead to decreased frequency of repeat surgeries and lower healthcare costs over time.
Partnerships and Pricing. Engage with GPOs to secure competitive pricing and ensure that your products are accessible through insurance benefits. This broadens your market reach and patient accessibility.
Value-Added Services. Differentiate your offerings by providing rebates, training and support services. These can enhance the perceived value of your products and foster loyalty among healthcare providers.
Clinical Impact
Regulatory Approval and Safety. Ensure all products meet FDA standards. This underscores your commitment to clinical efficacy and patient safety.
Evidence-Based Effectiveness. Back your claims with solid evidence, such as peer-reviewed studies and case studies that illustrate improved patient outcomes and recovery times. This solidifies your products’ reputation in the market.
Risk Management. Address potential safety concerns proactively and provide clear protocols for managing risks in partnership with healthcare providers. These actions reinforce trust in your brand.
Patient-Centered Product Development. Aligning product development and offerings with patient-centered outcomes and satisfaction is crucial. This entails focusing on how products can enhance the patient experience, reduce recovery times and improve quality of life. Incorporating patient feedback into product design and value analysis can provide a more comprehensive understanding of clinical effectiveness and ensure that the patient’s voice is represented in healthcare decisions.
Operational Impact
Integration and Compatibility. Design products that easily integrate into existing healthcare IT systems and workflows, minimizing the need for extensive training or system modifications. In the digital age, ensuring the privacy and security of patient data is paramount. As orthopedic devices become increasingly integrated with healthcare IT systems, companies must demonstrate rigorous data protection measures. This includes compliance with healthcare data regulations and robust cybersecurity measures to protect sensitive information and build trust with healthcare providers and patients.
Supply Chain Efficiency. Optimize your supply chain to reduce inventory needs and facilitate easy product transitions, ensuring that your products are readily available when needed without overburdening healthcare providers with excessive stock. The integration of the 360-degree value analysis into existing operational frameworks can be streamlined with the right tools and procedures. Advanced ERP and supply chain management systems are designed to accommodate such comprehensive analysis, ensuring that the operational impact is not only manageable but also beneficial in enhancing efficiency and reducing waste.
Product Trials. Offer trial periods for your products by giving providers the opportunity to assess their impact and suitability before committing to a purchase.
Innovation. Emphasize the role of innovation in your products. This includes leveraging cutting-edge technologies such as artificial intelligence, robotics and telehealth capabilities. These innovations can not only enhance surgical precision and patient outcomes but also streamline operational efficiencies and support remote monitoring, contributing to the overall resilience and sustainability of healthcare practices.
Resilience Impact
Supply Chain Transparency. Be open about the robustness of your supply chain, including providing risk assessments and historical data on past disruptions. Transparency builds confidence among healthcare providers in your ability to deliver products consistently.
Customer Service. Maintain a reputation for responsive and reliable customer service by emphasizing your commitment to supporting healthcare providers, even in challenging circumstances.
Sustainability Impact
Sustainable Practices. Implement and highlight sustainable manufacturing processes, such as reducing hazardous materials and increasing the recyclability of your products. This not only minimizes environmental impact but also aligns with the sustainability goals of many healthcare organizations.
Environmental Documentation. Provide detailed documentation of your products’ environmental impact by sharing with healthcare providers the data needed to make informed decisions that align with their sustainability objectives.
Diversity Impact
Commitment to Diversity. Demonstrate your commitment to diversity, equity and inclusion (DEI) within your operations and supply chain. This can include partnering with diverse suppliers and being transparent about these partnerships.
Community Engagement. Show your involvement in community and social responsibility initiatives, further highlighting your company’s values and commitment to broader societal health and well-being.
Global Efforts. Embracing a global perspective on health equity represents another vital dimension. Orthopedic device companies should consider how their products and operations can reduce health disparities not just within local communities but also globally. This involves assessing the accessibility and affordability of products in low-resource settings and exploring partnerships that can expand access to essential orthopedic care in underserved regions. By doing so, companies affirm their commitment to diversity and inclusion beyond traditional market boundaries.
The emphasis on sustainability and diversity is not just a moral imperative but also a strategic one. By adopting practices that prioritize environmental stewardship and diversity, healthcare organizations and their suppliers can meet the evolving expectations of patients, regulatory bodies and the community at large and secure a competitive edge in the market.
Moving forward, orthopedic companies must adapt and adopt a more holistic approach to their operations and product development, aligning them with the comprehensive criteria set forth by healthcare organizations’ evolution toward a more data-driven, comprehensive value analysis of all products, equipment and purchased services.
A focus on financial viability, clinical efficacy, operational efficiency, resilience, environmental sustainability and diversity will position orthopedic companies as essential partners in delivering high-quality and cost-effective patient care. This alignment not only meets the current demands, mission and values of healthcare providers but also sets up companies for success in an increasingly globalized and competitive healthcare landscape.
Kevin Lewis is a proven leader and visionary executive with over three decades of leadership in healthcare, specializing in improving comprehensive organization performance — including financial, clinical, operational, resilience, environmental sustainability and diversity improvement — pioneering innovative solutions and upgrading end-to-end enterprise operations.
In the ever-evolving landscape of healthcare, achieving financial resilience has transcended being a mere objective to become an indispensable survival strategy. The healthcare sector, perennially subjected to market fluctuations, regulatory transformations and global health crises, demands of its constituents a level of service delivery that...
In the ever-evolving landscape of healthcare, achieving financial resilience has transcended being a mere objective to become an indispensable survival strategy. The healthcare sector, perennially subjected to market fluctuations, regulatory transformations and global health crises, demands of its constituents a level of service delivery that focuses on quality, patient care and staff safety.
In navigating this terrain, healthcare organizations must master the art of supply chain spend optimization, adept pricing strategies and shrewd contract negotiations that encompass a broad spectrum of products, capital equipment and purchased services. This mastery not only promises enhanced financial performance but also equips them with the resilience needed to thrive amidst inevitable disruptions.
For orthopedic companies, understanding the nuanced shifts in how hospital customers adapt to these dynamic conditions is not just beneficial — it’s critical. This article unveils a groundbreaking “360-degree” value analysis model, which serves as a beacon for forward-thinking healthcare organizations, hospitals and non-acute facilities that aim to redefine their approach to supply chain management and elevate their financial well-being. This innovative model opens a new competitive battleground for orthopedic device companies and offers fresh avenues to strengthen partnerships with their customers.
By aligning with the holistic objectives of financial health, clinical excellence, operational efficiency, resilience, sustainability and diversity, orthopedic companies can unlock their full potential for collaboration and organizational impact.
Evolving Toward Comprehensive Value Analysis
A “360-degree” value analysis program goes beyond traditional evaluation metrics. It offers an interdisciplinary view that encompasses the entirety of an organization’s purchasing decisions — from the smallest products to the most significant capital equipment and purchased services. The weaving together of multiple objectives ensures that every decision is not merely a transaction but a step toward achieving overarching strategic ambitions and values.
This paradigm shift is a clarion call for orthopedic companies to align product offerings with the multifaceted criteria now at the heart of healthcare procurement — where cost efficiency melds with quality patient care, operational excellence and a steadfast commitment to diversity and sustainable practices. This 360-degree scrutiny raises the bar for the products that make it into the healthcare ecosystem and champions social responsibility by elevating an organization’s standing in the community it serves.
While navigating this evolved value analysis landscape may seem daunting for orthopedic companies, it also opens a doorway to unparalleled growth and partnership opportunities.
360-degree Value Analysis Questions and Comprehensive Approach
Orthopedic companies must be prepared to answer the following questions about their products and operations.
Financial Impact
Healthcare organization resources: Purchasing, supply chain, strategic planning, revenue cycle management, GPO(s), supplier/vendor
- What is the annual impact on the cost of supplies or services?
- What is the impact on enterprise net revenue?
- Is the new product or service part of the patient’s insurance benefits?
- Is the new product or service codable?
- Will payers cover the new product or service?
- Is the new product or service available on GPO contract?
- Will other supplier contracts be negatively impacted?
- Is a rebate or other value-added structure available with the supplier or vendor?
Clinical Impact
Healthcare organization resources: Physician and clinician end users, supply chain, medical library, suppliers, GPO(s), supplier/vendor
- Are the new products certified by FDA or Centers for Disease Control and Prevention?
- How will the new product or service affect current clinical outcomes?
- Will the new product or service reduce variation in the delivery of care?
- Will the new product or service improve efficiency?
- What is the highest level of research supporting the product or service?
- Does the new product or service have reported adverse events?
- What potential clinical impacts or safety risks to the patient should be considered?
- Is there shared responsibility of risk with the supplier on the new product or service?
Operational Impact
Healthcare organization resources: Supply chain, physician/clinician end users, suppliers /distributors, GPO(s), supplier/vendor
- What departments and end users will be impacted?
- Will biomed, sterile processing or IT be involved?
- What regulatory concerns will be addressed?
- Will a trial of the new product or service be needed?
- Will staff education be needed?
- Will the new product involve on-site or off-site distribution?
- Will the new product help reduce inventory?
- If a product conversion is involved, how much current remaining stock will need to be used?
- Will changes be needed in other platforms, such as enterprise resource planning (ERP), materials management information system (MMIS) or electronic health record (EHR)?
Resilience Impact
Healthcare organization resources: Purchasing, supply chain, suppliers/distributors, GPO(s), supplier/vendor
- What is the supplier or vendor risk score?
- What is the supplier or vendor outage history compared to peers?
- What is the supplier or vendor incident history compared to peers?
- What is the supplier or vendor response rate to customer concerns and/or outages?
- What is the supplier or vendor backorder rate?
- What is the supplier or vendor fill rate?
Environmental Sustainability Impact
Healthcare organization resources: Purchasing, supply chain, suppliers/distributors, GPO(s), supplier/vendor
- What is the chemical transparency of the product or service being considered?
- Does the new product or service reduce patient and staff exposure to unsafe chemicals?
- Does the new product or service contribute to waste reduction efforts?
- Does the supplier or vendor have a record of environmental responsibility?
Diversity Impact
Healthcare organization resources: Purchasing, supply chain, suppliers/distributors, GPO(s), supplier/vendor
- Is the supplier or vendor a diverse business?
- Is the supplier or vendor transparent with their Tier 2 diversity data?
- Does the supplier or vendor have a record of social responsibility?
Implementing a 360-degree value analysis model does not necessarily require additional resources, but rather a realignment of existing ones. By leveraging cross-functional teams and integrating data analytics into decision-making processes, organizations can enhance their supply chain operations without significant increases in expenditure or personnel. Numerous healthcare organizations have successfully implemented similar approaches. Tailored support and phased integration strategies enable a smooth transition and ensure that the model’s breadth enhances rather than complicates decision-making processes.
How to Compete in 360-degree Value Analysis
Let’s break down what this looks like in practice.
Financial Impact
Cost-Effectiveness. Emphasize the economic value of your products, not just in terms of purchase price but also through their contribution to reducing overall treatment costs. This includes showcasing the longevity and durability of devices, which can lead to decreased frequency of repeat surgeries and lower healthcare costs over time.
Partnerships and Pricing. Engage with GPOs to secure competitive pricing and ensure that your products are accessible through insurance benefits. This broadens your market reach and patient accessibility.
Value-Added Services. Differentiate your offerings by providing rebates, training and support services. These can enhance the perceived value of your products and foster loyalty among healthcare providers.
Clinical Impact
Regulatory Approval and Safety. Ensure all products meet FDA standards. This underscores your commitment to clinical efficacy and patient safety.
Evidence-Based Effectiveness. Back your claims with solid evidence, such as peer-reviewed studies and case studies that illustrate improved patient outcomes and recovery times. This solidifies your products’ reputation in the market.
Risk Management. Address potential safety concerns proactively and provide clear protocols for managing risks in partnership with healthcare providers. These actions reinforce trust in your brand.
Patient-Centered Product Development. Aligning product development and offerings with patient-centered outcomes and satisfaction is crucial. This entails focusing on how products can enhance the patient experience, reduce recovery times and improve quality of life. Incorporating patient feedback into product design and value analysis can provide a more comprehensive understanding of clinical effectiveness and ensure that the patient’s voice is represented in healthcare decisions.
Operational Impact
Integration and Compatibility. Design products that easily integrate into existing healthcare IT systems and workflows, minimizing the need for extensive training or system modifications. In the digital age, ensuring the privacy and security of patient data is paramount. As orthopedic devices become increasingly integrated with healthcare IT systems, companies must demonstrate rigorous data protection measures. This includes compliance with healthcare data regulations and robust cybersecurity measures to protect sensitive information and build trust with healthcare providers and patients.
Supply Chain Efficiency. Optimize your supply chain to reduce inventory needs and facilitate easy product transitions, ensuring that your products are readily available when needed without overburdening healthcare providers with excessive stock. The integration of the 360-degree value analysis into existing operational frameworks can be streamlined with the right tools and procedures. Advanced ERP and supply chain management systems are designed to accommodate such comprehensive analysis, ensuring that the operational impact is not only manageable but also beneficial in enhancing efficiency and reducing waste.
Product Trials. Offer trial periods for your products by giving providers the opportunity to assess their impact and suitability before committing to a purchase.
Innovation. Emphasize the role of innovation in your products. This includes leveraging cutting-edge technologies such as artificial intelligence, robotics and telehealth capabilities. These innovations can not only enhance surgical precision and patient outcomes but also streamline operational efficiencies and support remote monitoring, contributing to the overall resilience and sustainability of healthcare practices.
Resilience Impact
Supply Chain Transparency. Be open about the robustness of your supply chain, including providing risk assessments and historical data on past disruptions. Transparency builds confidence among healthcare providers in your ability to deliver products consistently.
Customer Service. Maintain a reputation for responsive and reliable customer service by emphasizing your commitment to supporting healthcare providers, even in challenging circumstances.
Sustainability Impact
Sustainable Practices. Implement and highlight sustainable manufacturing processes, such as reducing hazardous materials and increasing the recyclability of your products. This not only minimizes environmental impact but also aligns with the sustainability goals of many healthcare organizations.
Environmental Documentation. Provide detailed documentation of your products’ environmental impact by sharing with healthcare providers the data needed to make informed decisions that align with their sustainability objectives.
Diversity Impact
Commitment to Diversity. Demonstrate your commitment to diversity, equity and inclusion (DEI) within your operations and supply chain. This can include partnering with diverse suppliers and being transparent about these partnerships.
Community Engagement. Show your involvement in community and social responsibility initiatives, further highlighting your company’s values and commitment to broader societal health and well-being.
Global Efforts. Embracing a global perspective on health equity represents another vital dimension. Orthopedic device companies should consider how their products and operations can reduce health disparities not just within local communities but also globally. This involves assessing the accessibility and affordability of products in low-resource settings and exploring partnerships that can expand access to essential orthopedic care in underserved regions. By doing so, companies affirm their commitment to diversity and inclusion beyond traditional market boundaries.
The emphasis on sustainability and diversity is not just a moral imperative but also a strategic one. By adopting practices that prioritize environmental stewardship and diversity, healthcare organizations and their suppliers can meet the evolving expectations of patients, regulatory bodies and the community at large and secure a competitive edge in the market.
Moving forward, orthopedic companies must adapt and adopt a more holistic approach to their operations and product development, aligning them with the comprehensive criteria set forth by healthcare organizations’ evolution toward a more data-driven, comprehensive value analysis of all products, equipment and purchased services.
A focus on financial viability, clinical efficacy, operational efficiency, resilience, environmental sustainability and diversity will position orthopedic companies as essential partners in delivering high-quality and cost-effective patient care. This alignment not only meets the current demands, mission and values of healthcare providers but also sets up companies for success in an increasingly globalized and competitive healthcare landscape.
Kevin Lewis is a proven leader and visionary executive with over three decades of leadership in healthcare, specializing in improving comprehensive organization performance — including financial, clinical, operational, resilience, environmental sustainability and diversity improvement — pioneering innovative solutions and upgrading end-to-end enterprise operations.
You’ve reached your limit.
We’re glad you’re finding value in our content — and we’d love for you to keep going.
Subscribe now for unlimited access to orthopedic business intelligence.
