One powerful example you can foresee eventually would be a world where the healthcare institution has standard, internally developed contract terms they propose to their vendor for services rather than the other way around. Today, in a given service category each vendor has unique terms that they craft to protect and benefit themselves that require their customer (the health system) to review and ultimately agree. Flipping the script and giving the customers the leverage to dictate terms that are advantageous to them can remove a significant amount of friction internally for legal reviews, increase consistency in obtained services and reduce variability in vendor offerings, and many other benefits.

HCB News: What are some of the key advantages for health systems when they implement an effective VRM program?


EM: A lot of times the success or failure of a vendor relationship is determined less by the features and quality of the product, but by the fit within the current environment. We saw this a lot as healthcare consultants—the technology would be the same, but would produce varied results depending on how much preparation the organization did ahead of implementation and how well-aligned the contract’s incentives were going into the business relationship.

Life cycles are such within healthcare IT that a poor implementation takes about 18 to 24 months to recover from. With a typical software/service contract at 24 to 36 months, organizations find themselves in a constant state of vendor churn rather than optimizing for current toolsets. A VRM simplifies vendor searches and proposals so that the hospital can take back control over the process. A platform like Venddy’s enables more effective diligence to be performed before a selection is made, but it works even earlier than that to help organizations develop the key parameters that are right for them. Rather than procrastinating a change in vendors due to the pain of the traditional RFP approach, instead health systems can jump right into the process know it will be efficient and successful.

HCB News: What are some of the key differences between your vision for a VRM-enabled healthcare world and the current approaches being taken by provider organizations?

PR: With VRM, as we said, providers own their buyer's journey. They proactively identify a need, clarify their expectations, and find the vendor that can meet that need under those terms.

This increased leverage for health systems comes from reducing the information gap between buyers and sellers. With the benefit of honest, transparent, peer-driven knowledge-sharing, health systems are empowered to make a decision and confidently commit to the vendor relationship that’s right for them—even if that decision is sometimes not to go with a vendor at all, and to rely instead on in-house capacity.

More Voices