Re-Examine Your Business Model Before Your Competitor Does

Filed under: barcode equipment maintenance, Barcode Scanner Repair, business model, flat rate repair, HHP, intermec, symbol, Announcements

Noah Berger for The New York Times

There was a great article in yesterday's New York Times business section about business model innovation in the delivery of health care services.  The author, Janet Rae-Dupree, did a solid job of pointing out how tired, inefficient business models employed by most physicians and general hospitals actually limit improvements in "care-quality" for patients and keep costs high.  She quotes Harvard b-school professor and author of "The Innovator's Prescription", Clayton M. Christensen, who argues that "health care hasn't become affordable because it hasn't yet gone through disruptive decentralization".

Briefly, the article explains that important point thusly:  "by putting the financial interests of hospitals and doctors at the center, the current system gives routine illnesses with proven therapies the same intensive and costly specialized care that more complicated cases require".  So in a phrase, it's "one-size-fits-all" treatment -- and it's an expensive size!  For a fuller explanation, please read the complete article here.

The other business model problem the article addresses is the lack of focus on a "continuum of care" for the patient, in favor of a system which treats patients only during periods of acute crisis.  Again, the result is high costs -- at least partially driven by wrong incentives in place for doctors and hospitals. 

Several organizations including Kaiser Permanente and the Mayo Clinic really seem to be getting it right, though, "with fixed-fee integrated systems" that are delivering better results for less money.  Hey they're focused on the patient (aka "the customer"), not the doctor or hospital.

Many similar strategies are employed by Lexicon in our barcode equipment repair and maintenance business.  RepairEngine® helps us and our customers keep track of the "health history" of Symbol, Intermec, and HHP equipment, and on many products we've incorporated special SIP (single-item-pricing) options instead of higher "one-size-fits-all" flat rates that frankly, are often not needed, and are not economical.

It's a reminder to not fall in love with your business model so much that you miss a big innovation opportunity . . . you can bet that at least some of your competitors won't.