A Proven Methodology Designed to Generate Substantial Cost Savings for the Health Care Industry

1. The Proven Path to Cost Savings
A Team-Based Process Improvement Program
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2. Where We Find Ourselves at the
Beginning of 2011
Increased Supply
Network Complexity
Missing Articulate
Customer and Supplier
Strategies
Fuzzy Vision and Way
Forward
Reactive Behavior
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3. Shared Challenges Facing Supply
Managers
How to Best Interact with
Other Business Functions
How to Define
Interactions with
Suppliers and Customers
How to Identify and Clear
Any Obstacles in Our
Way
How to Ensure Long-
Lasting Cost Savings
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4. An Enduring Question:
 How Do We Ensure Long-Term Cost Savings In
the Face of Short-Term Demands and Operational
Constraints?
PriceEscalation
Unresponsive Suppliers
Fewer Organizational Resources
We Have a Program That Will Address
and Overcome Such Challenges
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5. The Proven Path to Cost Savings
Framework for Required
Stage I Collaborative Architecture Strategic Thinking and
Behavior
Process Improvement Offers a Proven Path to Cost
Stage II Framework Savings and Process
Effectiveness
Extended Enterprise
Stage III Process Improvement Enablement
Mentored Project Teams
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6. Working Together
Stage I Collaborative Architecture
 High-Level Working Framework Framework Elements

Links Corporate Strategy to
Collaborative Innovation
Measurable Outcomes
Strategic Alliances
Process Improvement
Trusting Relationships
Capability Across Enterprise
Information and
Boundaries Communications
Technologies
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7. Enabling Behavior Change
Process Improvement
Stage II Framework
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 A “Road Map” for
4
Process Improvement
Initiatives
Systemic Focus
3
Modified Behaviors
Strategic Focus
 Reactive to Progressive 2
 Functional and Individual
Transactional Focus
Process
1
Focus
Clerical Focus
Developed By Dr. David N. Burt,
Robert Porter Lynch and James D.
Reeds. The Supply Chain
Management Institute, University
of San Diego, 2001-2009
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8. How We Help Generate Optimal Cost Savings
Stage III Process Improvement Enablement
 Continuous Process Improvement
 Self-Directed Work Teams
 Learning on the Job (Action Learning)
 Distance Learning Technologies
 Project Management
 Institutionalize Learning
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9. A Typical Program Timeline 12-16
Months
Mastery Mastery Application
Stage I Stage II Stage III
Knowledge Knowledge Learning
Intensive
Project
Workshops
Selection
Pre-Program and
and Project
Collaboration/ Team
Design Approval Execution
Formation
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10. An Example of Demonstrated Cost
Savings Using the Proven Path
 U.S. Aerospace- Project Year 1 Cost 5-Year Cost
Defense Prime Savings Savings
Contractor 1 7,077,000. 146,000,000.
(2002-2004) – Selected
Projects 2 14,100,000. 22,100,000.
 Total Cost Savings 3 2,559,000. 13,675,000.
[$MM] (Direct to the
Bottom Line) From 4 1,761,000. 18,811,000.
the Work of Four $25,497,000. $200,586,000.
Project Teams
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