Hidden Costs in Healthcare RFPs Ice Burg

Shackled to Spreadsheets: The Growing Costs of Healthcare RFPs

Healthcare is notorious for long, crawling purchase cycles, and no process better demonstrates that than an “RFP.” Used to compare and evaluate vendor products and services, this approach was once the gold standard for vendor diligence, but it has come at a price, specifically limiting organizations’ ability to innovate and see faster returns on their purchases.

Speed Up Your RFP Process to Deliver a Solution More Rapidly

Most organizations use a Request for Proposal (RFP) as part of a selection process to solicit vendors for products or services. Historically, this questionnaire format helped organizations manage the complexity of the products evaluated, ensure that a vendor can fulfill its promises, and document the diligence necessary to purchase goods and services. To assemble an RFP the needs from various departments are included as requirements, usually compiled in a spreadsheet, and are sent to vendors to respond. Vendors document their capability to meet those requirements, from which a project owner or selection committee selects the best vendor for their needs.

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Stop Dreading Team Purchasing Decisions

I heard a story last week that instantly took me back to my consulting days. Picture this: a fully staffed Command Center. Upwards of 2,000 support tickets logged; over 1,200 closed. Training support onsite for 300 ambulatory locations. A big bang Go Live that was meticulously built and planned for over a year. All 8,000 providers launched into the black hole of a new electronic medical record system.

It’s a big deal and comes with a big price tag. And it should, right? Digitizing the entire medical record for all of an organization’s patients is a necessary evil in today’s world that has far reaching tendrils that impact all integrations, medical devices, third party vendors, providers (internally and externally), and most importantly – patients. You need to be confident you partnered with the right vendor long before Go Live.

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Top 5 Mistakes Made During Vendor Selection and RFPs

The pressure is on. You better make sure your selected vendor is top-notch, has incredible onboarding, works with you to ensure a timely implementation, and is priced competitively. In this post, we share the biggest pitfalls of the vendor selection process and how to avoid them.

1. Assuming you know all the players

Of course you know most of the big players in the market for your project or initiative – but what about those smaller, regional companies with products and services better suited for the future, or those partners you already work with who have another product line or service (that you don’t already know about)?

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How Do You Distinguish a Vendor from a Partner?

Finding a Partner, Not Just a Vendor


Aligning a vendor with your organization is critical for forming a successful partnership that will ensure your business objectives are met. Depending on your organizational needs, qualifying questions can help you get your list down to better vendor partners earlier, before heading into the full “requirements gathering” phase of your project. This will dramatically reduce the amount of time communicating, evaluating, and showcasing vendors – making your whole process more efficient.

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3 Simple Ways to Accelerate Your Sourcing Process with Better Results


From standard purchased services categories like laundry and linen or HVAC services to seasonal/geographic driven categories such as snow plow services, there are hundreds of categories and thousands of vendors that hospitals and health systems utilize daily. Every hospital and health system is different and has unique needs based on their location and the patients they serve. Aligning these particular needs with the unique factors that pertain to each purchased services category is challenging, and most of the work that is done during the RFP process can be daunting as well.

Depending on the complexity of the category, an RFP cycle can take four to six months from start to finish and require a time commitment of 5-20% from each sourcing professional during the bidding event (Robert J. Engel. Strategic Sourcing: A Step-By-Step Practical Model, The Procurement Centre). Insight from Valify’s database shows, a typical health system’s purchased services spend is spread out, on average, across 383 individual categories (some have spend across as many has 734 categories). These figures directly correlate to the number of vendors a health care provider has on contract.

It’s fair to say that sourcing professionals spend a significant amount of time working on RFPs – including conducting research specific to each category, defining award criteria, managing vendor communications, evaluating responses, analyzing impacts, and negotiating final terms. While each of these aspects could benefit from process improvement measures, our purchased services experts have put together a list of the top three tips for accelerating the RFP process while achieving better results.

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Decision Making: The Constant Struggle (part 2 of 3)

Last week we wrote about accelerating decision making by improving consensus, knowing your exit criteria, and avoiding analysis paralysis. This week, we’re getting down to the nitty-gritty on how simplicity can drive decision making everywhere.

Hick’s Law

(About the Hick-Hyman Law, 1952)

A scientific concept exists that will make complete sense to you: response time goes up with the number of options. In other words: more options = more time it takes to make a decision. No brainer, right?

Wrong! In our collective effort to give users the best web experience, highlight our cooking talent, or a sales guy that ‘has everything for everyone,’ this concept of minimizing options is often completely neglected.

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