If you are a healthcare provider, or you are connected to purchasing for a large healthcare organization like a hospital, the B2B revolution is coming to you soon. Services and responsiveness similar to those seen on Amazon are the target for online sellers with many benefits to you and your organization. These benefits will be particularly important as we move into the new Affordable Care Act’s value-based purchasing world.
eCommerce is overtaking the marketplace, a trend you may notice based on a growing disappearance of printed catalogs. As much as 69% of supplier organizations have set goals to eliminate what is becoming an antiquated form of communication, according to a recent study. Instead, these businesses are positioning themselves to sell online, providing self service options that are available 24 hours a day so as to accommodate any customer’s schedule. Beyond that, many are even exploring smart phone apps that will extend their reach even further.
“B2B eCommerce enables customers to have complete control of their shopping experience and customers demand technologies that support research, buying and customer service on their own time and terms,” said Brian Walker, senior vice president, strategy, at Hybris in relation to the study. “B2B companies must offer a world-class experience akin to B2C throughout the customer lifecycle to stay ahead of the competition in both revenue and customer loyalty.” Hybris is the global leader in eCommerce solutions and also who commissioned the study.
This increased level of convenience promises to reduce time spent searching, while creating efficiencies that reduce procurement costs. Purpose made software systems and websites are poised to allow comparison shopping between multiple suppliers. Instead of a purchasing agent seeking quotes and spending considerable time on the phone, many products could be placed side by side in cyberspace, allowing purchase in one or two clicks.
According to lean principles, waste is any activity performed that doesn’t add value to the final product your organization delivers. B2B eCommerce as described above eliminates many other aspects of waste beside reduced search time.
Another example is the provision of accurate and timely business information, which could take the form of real time order tracking that can be viewed on the supplier’s website. Purchase orders can be entered electronically and become part of the record, eliminating lost or misplaced POs, which in turn can lead to order delays. In most cases, administrative activities like these may constitute 60%-80% of all costs related to purchasing. Online payment processing can also benefit from similar efficiencies. Streamlining processes in any way possible goes straight to the bottom-line.
In the ever more challenging health care space, where margins are always being challenged by reimbursement, an even more substantial way for B2B eCommerce to benefit health care providers is in the inventory management space. Efficiencies developed by B2B eCommerce communications and transactions can help with some of the most common issues with respect to inventory. Some of the most cited examples of inventory waste include expired supplies, like medications and sterile disposables with a shelf life. Additionally, costs due to excessive storage can occur when lead times are relatively long. B2B eCommerce takes this into account and with the tools available can facilitate reduced lead times, striving for an optimal customer-supplier relationship, through increased communication.
Value-based purchasing, words that resonate through the health care industry, will require finding efficiencies as the transition occurs from more traditional business models.
“What we have now is a payment system that says, ‘Do as much as you can,’ but also ‘We’re going to review what you do.’ ” says Stuart Guterman, vice president for the Commonwealth Fund’s Program on Payment and System Reform in a recent report from Curaspan. Things have now changed to a method that provides more favorable reimbursement for cost-effective, high quality care. “Value-based purchasing aims to achieve this by paying for the right things,” Guterman says.
Evaluation of quality becomes more important as this incentive program developed as part of the Affordable Care Act comes on line. This promises to give purchasers a greater work load as they evaluate and spend time finding options that will help their organization meet these goals.
B2B eCommerce will be there to provide a helping hand.