Simulation and modeling efforts to support decision making in healthcare supply chain management.

Recently, most healthcare organizations focus their attention on reducing the cost of their supply chain management (SCM) by improving the decision making pertaining processes' efficiencies. The availability of products through healthcare SCM is often a matter of life or death to the patient; therefore, trial and error approaches are not an option in this environment. Simulation and modeling (SM) has been presented as an alternative approach for supply chain managers in healthcare organizations to test solutions and to support decision making processes associated with various SCM problems. This paper presents and analyzes past SM efforts to support decision making in healthcare SCM and identifies the key challenges associated with healthcare SCM modeling. We also present and discuss emerging technologies to meet these challenges.

Needed: a strategic approach to supply chain management.

When devising a supply chain strategic plan, consider these points: Frame the supply chain broadly to include all possible components and expenses. Recognize how each part of the supply chain affects other parts. Engage all parties and customers in strategic discussions. Educate all involved. Objectively assess the current state. Visualize an unencumbered future state. Quantify quality, productivity, and financial goals.

What's in a brand?

Strategic Planning: When your hospital's name is synonymous with your highest goals, you may have achieved "branding" success.

Strengthening implant provision and acceptance in South Africa with the 'Any woman, any place, any time' approach: An essential step towards reducing unintended pregnancies

Progress in reducing unintended pregnancies in South Africa is slow. The implant, introduced in 2014, expanded the range of available longacting reversible contraceptives (LARCs) and held much promise. Uptake, however, has declined precipitously, in spite of its 'unmatched effectiveness' and high levels of satisfaction for most users. We propose policy and provider interventions to raise implant use, underscored by a 'LARC-first' approach. Contraceptive counselling should focus on the particular benefits of LARCs and methods be presented in order of effectiveness. Moreover, implants hold particular advantages for certain groups, especially adolescents and young women, in whom it is considered first-line contraception. Provision of immediate postpartum and post-abortion implants is safe and highly acceptable, yet remains under-utilised. Implant services at HIV and tuberculosis clinics are a key priority, as is inclusion of LARC provision within school health services. Implants could also be delivered by existing mobile outreach services, for example in sex worker programmes. Services could be built around nurses dedicated solely to providing implants, with other health workers receiving brief refresher training. Women who experience side-effects, especially abnormal bleeding, require timely interventions, following a standardised protocol, including use of medications. Encouraging return for side-effects, follow-up phone calls and home visits would raise continuation rates. Removal services require doctor support or designated nurses at specific centres. Limited access to removal services, health workers' resistance or botched procedures will further undermine implant provision. Rapid implant demonstration projects in postpartum wards, schools, outreach services and by dedicated providers may rapidly advance the field. Together, the actions outlined here will ensure that the implant fulfils its potential and reinvigorates family planning services.

The half-truth of first-mover advantage.

Many executives take for granted that the first company in a new product category gets an unbeatable head start and reaps long-lasting benefits. But that doesn't always happen. The authors of this article discovered that much depends on the pace at which the category's technology is changing and the speed at which the market is evolving. By analyzing these two factors, companies can improve their odds of succeeding as first movers with the resources they possess. Gradual evolution in both the technology and the market provides a first mover with the best conditions for creating a dominant position that is long lasting (Hoover in the vacuum cleaner industry is a good example). In such calm waters, a company can defend its advantages even without exceptional skills or extensive financial resources. When the market is changing rapidly and the product isn't, a first entrant with extensive resources can obtain a long-lasting advantage (as Sony did with its Walkman personal stereo); a company with only limited resources probably must settle for a short-term benefit. When the market is static but the product is changing constantly, first-mover advantages of either kind--durable or short-lived--are unlikely. Only companies with very deep pockets can survive (think of Sony and the digital cameras it pioneered). Rapid churn in both the technology and the market creates the worst conditions. But if companies have an acute sense of when to exit-as Netscape demonstrated when it agreed to be acquired by AOL-a worthwhile short-term gain is possible. Before venturing into a newly forming market, you need to analyze the environment, assess your resources, then determine which type offirst-mover advantage is most achievable. Once you've gone into the water, you have no choice but to swim.

Break free from the product life cycle.

Most firms build their marketing strategies around the concept of the product life cycle--the idea that after introduction, products inevitably follow a course of growth, maturity, and decline. It doesn't have to be that way, says HBS marketing professor Youngme Moon. By positioning their products in unexpected ways, companies can change how customers mentally categorize them. In doing so, they can shift products lodged in the maturity phase back--and catapult new products forward--into the growth phase. The author describes three positioning strategies that marketers use to shift consumers' thinking. Reverse positioning strips away"sacred" product attributes while adding new ones (JetBlue, for example, withheld the expected first-class seating and in-flight meals on its planes while offering surprising perks like leather seats and extra legroom). Breakaway positioning associates the product with a radically different category (Swatch chose not to associate itself with fine jewelry and instead entered the fashion accessory category). And stealth positioning acclimates leery consumers to a new offering by cloaking the product's true nature (Sony positioned its less-than-perfect household robot as a quirky pet). Clayton Christensen described how new, simple technologies can upend a market. In an analogous way, these positioning strategies can exploit the vulnerability of established categories to new positioning. A company can use these techniques to go on the offensive and transform a category by demolishing its traditional boundaries. Companies that disrupt a category through positioning create a lucrative place to ply their wares--and can leave category incumbents scrambling.

Product definition for healthcare contracting: an overview of approaches to measuring hospital output with reference to the UK internal market.

OBJECTIVE: In many industrialised countries, health care third party payers are moving towards contracted provision arrangements with suppliers of hospital care. Essential to such a process is a standard approach to quantifying the care provided. This paper aims to outline the possible approaches to hospital product definition for the UK National Health Service, and recommends appropriate further research. METHODS: All published and unpublished studies on hospital output measurement in the NHS since 1980 were sought for the purposes of the review. This included both discursive and empirical work, and no exclusion criteria were applied. Most empirical reports on this topic, however, come from the United States. Consequently, the published reports since 1980 from the USA, accessed from the Medline and Healthplan CD-ROM databases, have also been included in the overview. CONCLUSIONS: Where data are sufficient, the true casemix approach offers advantages over other methods of output measurement. In the UK NHS, two systems--diagnosis-related groups (DRGs) and healthcare resource groups (HRGs)--are the only casemix measures that have achieved any significant degree of attention. DRGs have been extensively evaluated internationally, and explain variations in resource use in the UK slightly better than do HRGs. As a local product, HRGs can be more easily adapted to the specific needs of the NHS internal market, however, and will thus probably emerge as a better measure for the UK in the long term. In both cases, locally derived cost weights are unavailable, and their development constitutes a major requirement for use in contracting. Adaptations for long stay and outpatient hospital episodes would enhance the usefulness of hospital casemix systems in the NHS. Existing approaches, such as specialty based classifications, are neither standardised nor predictive of resource use, and would be better replaced by casemix systems. Other countries facing similar choices between casemix measurement approaches will need to consider the "trade off" between the adaptability of locally derived systems on the one hand and the low cost, rapidly accessible results, and availability of international comparative data of an imported approach on the other.

Knowing your costs: the key to financial success of ambulatory surgery centers under prospective payment.

The need for ambulatory surgery centers to have accurate cost accounting systems will only continue to grow in the years to come and such systems can only improve the quality of decisions made for these facilities. With the advent of prospective payment for ambulatory services and continued escalating health care expenditures by government and commercial payors, continued rate cutting can be expected. Therefore, ASCs must know their costs, be able to compare costs to payments, and be able to respond to this information accordingly. Consequently, a strong cost accounting system is an essential vehicle for ambulatory surgery centers that wish to successfully venture into the mid-1990s and beyond.

Ambulatory encounter systems: implications for payment and quality.

Many key decision makers are looking to AESs solely for purposes of payment. This approach is unfortunate because many systems could be utilized for both payment and quality management purposes. It is important that the professional quality of care community be aggressive and document, through research and practical demonstration projects, how AESs can be used for both purposes. It is only in this manner that resource consumption can be both accurately analyzed and related to quality improvement.

Action steps for effectively managing ambulatory surgery under outpatient prospective payment.

This article reviewed common problems faced by managers in effectively using resources in ambulatory surgery. The article also recommended action steps for programs to consider to gain better control over the resources used in surgery. As reimbursement for outpatient surgery shifts to more resource use-based approaches, the importance of examining patterns of surgery and identifying opportunities for more efficient use of resources will grow in order to maintain financial and clinical performance.

Ten-year experience in managing a capitated ophthalmology carve-out by an academic eye center.

A 10-year experience of managing a capitated opthalmology carve-out by an academic health unit is presented. Lessons learned regarding pricing, utilization, and managing this contract are discussed. Handling the cost of education and remaining competitive is presented as a not-insurmountable hurdle. Academic health units can compete in today's environment; however, the learning curve is steep and the problems many.

Successful business planning for new programs in health care organizations.

Health care organizations implement business strategies through programs and services, and success depends on careful program design and execution. A conscientious design requires thorough efforts in organizing the planning process, conducting the decision analysis, and obtaining approval for a program. Weak methods and processes in the management of these efforts can result in faulty assumptions and costly errors in the development of new health care ventures, thus preventing the achievement of financial and operating goals. This article reviews the stages of business planning, and the points at which success may be impaired.

A derivation of the underlying constructs of just-in-time management systems.

Researchers have recommended that the theoretical constructs underlying just-in-time (JIT) management systems be identified and developed if JIT is to be fully understood and its full capabilities realized. In this study, we advanced this conceptual development through an instrument based on the relevant literature and empirically deriving three underlying constructs: (1) operating structure and control, (2) product scheduling, and (3) quality implementation. We report a content analysis of these constructs and develop propositions regarding their relationships, predecessors, and outcomes.

Discovering new points of differentiation.

Most profitable strategies are built on differentiation: offering customers something they value that competitors don't have. But most companies concentrate only on their products or services. In fact, a company can differentiate itself every point where it comes in contact with its customers--from the moment customers realize they need a product or service to the time when they dispose of it. The authors believe that if companies open up their thinking to their customer's entire experience with a product or service--the consumption chain--they can uncover opportunities to position their offerings in ways that neither they nor their competitors though possible. The authors show how even a mundane product such as candles can be successfully differentiated. By analyzing its customers' experiences and exploring various options, Blyth Industries, for example, has grown from a $2 million U.S. candle manufacturer into a global candle and accessory business with nearly $500 million in sales and a market value of $1.2 billion. Finding ways to differentiate one's company is a skill that can be nurtured, the authors contend. In this Manager's Tool Kit, they have designed a two-part approach that can help companies continually identify new points of differentiation and develop the ability to generate successful differentiation strategies. "Mapping the Consumption Chain" captures the customer's total experience with a product or service. "Analyzing Your Customer's Experience" shows managers how directed brainstorming about each step in the consumption chain can elicit numerous ways to differentiate any offering.

Growth outside the core.

Growth in an adjacent market is tougher than it looks; three-quarters of the time, the effort fails. But companies can change those odds dramatically. Results from a five-year study of corporate growth conducted by Bain & Company reveal that adjacency expansion succeeds only when built around strong core businesses that have the potential to become market leaders. And the best place to look for adjacency opportunities is inside a company's strongest customers. The study also found that the most successful companies were able to consistently, profitably outgrow their rivals by developing a formula for pushing out the boundaries of their core businesses in predictable, repeatable ways. Companies use their repeatability formulas to expand into any number of adjacencies. Some companies make repeated geographic moves, as Vodafone has done in expanding from one geographic market to another over the past 13 years, building revenues from $1 billion in 1990 to $48 billion in 2003. Others apply a superior business model to new segments. Dell, for example, has repeatedly adapted its direct-to-customer model to new customer segments and new product categories. In other cases, companies develop hybrid approaches. Nike executed a series of different types of adjacency moves: it expanded into adjacent customer segments, introduced new products, developed new distribution channels, and then moved into adjacent geographic markets. The successful repeaters in the study had two common characteristics. First, they were extraordinarily disciplined, applying rigorous screens before they made an adjacency move. This discipline paid off in the form of learning curve benefits, increased speed, and lower complexity. And second, in almost all cases, they developed their repeatable formulas by studying their customers and their customers' economics very, very carefully.

High-performance marketing: an interview with Nike's Phil Knight. Interview by Geraldine E. Willigan.

Nike's advertising slogans--"Bo Knows," "Just Do It," and "There Is No Finish Line"--have moved beyond advertising into popular expression. Its athletic footwear and clothing have become a piece of Americana. Its brand name is as well known around the world as IBM and Coke. Behind the slogans and the flashy TV commercials is the vision of its founder, chairman, and CEO, Phil Knight. Since forming the company in 1962, Knight has taken Nike from a small-time distributor of Japanese track shoes to the top of the athletic shoe and apparel market. But not without a stumble. Along the way, Knight discovered that technological innovation alone could not continue to drive growth. When sales stagnated in the mid-1980s, Knight and Nike learned several hard lessons on how to build brands and understand consumers, and they transformed their technology company into a marketing company whose product is its most important marketing tool. "Ultimately," says Knight, "we wanted Nike to be the world's best sports and fitness company. Once you say that, you have a focus. You don't end up making wing tips or sponsoring the next Rolling Stones world tour." To keep the company growing, Nike began splitting its brands into sub-brands. In tennis, Nike divided its shoes into Challenge Court--for younger, more active players--and Supreme Court--for older, more mature players. That approach brought the company to a broader range of consumers while preserving the customer base. And to create an emotional tie with the consumer, Nike started advertising on TV. "Sports is at the heart of American culture," Knight says. "You can't explain much in 60 seconds, but when you show Michael Jordan, you don't have to. It's that simple."

Deep change. How operational innovation can transform your company.

Breakthrough innovations--not just steady improvements--in operations can destroy competitors and shake up entire industries. Just look at Dell, Toyota, and Wal-Mart. But fewer than 10% of large companies have made serious attempts to achieve operational innovation. Why? One reason, contends the author, is that business culture undervalues operations--they're not as sexy as deals or acquisitions. In addition, many executives who rose through the ranks of finance or sales aren't familiar with operations--and they aren't interested in learning more. Finally, because no one holds the title Vice President of Operational Innovation, it doesn't have a natural home in the organization, so it's easily overlooked. Fortunately, all of these barriers can be overcome. This article offers practical advice on how to develop operational innovations, such as looking for role models outside your industry to emulate and identifying--and then defying--constraining assumptions about how work should be done. The author also discusses the best way to implement operational innovations. For instance, because they are disruptive by nature, projects should be concentrated in those activities with the greatest impact on enterprise strategic goals. Operational innovation may feel unglamorous or unfamiliar to many executives, but it is the only lasting basis for superior performance. Executives who understand how operational innovation happens--and who understand the barriers that prevent it from happening--can add to their strategic arsenal one of the most powerful competitive weapons in existence. In an economy that has overdosed on hype and in which customers rule as never before, operational innovation offers a meaningful and sustainable way to get ahead--and stay ahead--of the pack.

Strategic stories: how 3M is rewriting business planning.

Virtually all business plans are written as a list of bullet points. Despite the skill or knowledge of their authors, these plans usually aren't anything more than lists of "good things to do." For example: Increase sales by 10%. Reduce distribution costs by 5%. Develop a synergistic vision for traditional products. Rarely do these lists reflect deep thought or inspire commitment. Worse, they don't specify critical relationships between the points, and they can't demonstrate how the goals will be achieved. 3M executive Gordon Shaw began looking for a more coherent and compelling way to present business plans. He found it in the form of strategic stories. Telling stories was already a habit of mind at 3M. Stories about the advent of Post-it Notes and the invention of masking tape help define 3M's identity. They're part of the way people at 3M explain themselves to their customers and to one another. Shaw and his coauthors examine how business plans can be transformed into strategic narratives. By painting a picture of the market, the competition, and the strategy needed to beat the competition, these narratives can fill in the spaces around the bullet points for those who will approve and those who will implement the strategy. When people can locate themselves in the story, their sense of commitment and involvement is enhanced. By conveying a powerful impression of the process of winning, narrative plans can mobilize an entire organization.