So first, we dug into dental formularies, what they are and why you should build one, and then we walked you through the steps of building a dental formulary. So by now, you’ve analyzed your data and have narrowed down the list.However, in order to drive formulary compliance, keep your staff happy, and mitigate your risks, before you finalize your final formulary, you’ll want to assemble a team to trial, evaluate and help select the final products.
This will allow you the opportunity to bring everyone on board and help finalize a formulary that will help drive compliance. Why is driving formulary compliance so important?Because implementing cost-saving procurement strategies and negotiating contract pricing requires gaining control over how your business spends its dollars. Suppliers need to know that you will be able to execute on an agreement once you’ve negotiated. And in order to capture the cost savings you’ve negotiated, as well as maintain your word, so suppliers keep coming back to you with their best pricing, you’ll want this to.Secondly, allowing staff members to order supplies without policy or supplier and product approval processes introduces a myriad of risks to your organization (supplier solvency, poor quality, missed deliveries, and lack of compliance to regulatory requirements, to name just a few.)Lastly, as long as you do the work to ensure the right items are on your formulary, taking the decision-making out of your employees’ hands should ultimately be a relief and allow for a quicker, more systematic purchasing process (something you may want to point out to them.)
The size and makeup of your trial team will vary depending on the size of your organization and could be as few as one or two or may run up as large as 20 or 30 for larger DSOs. You know your staff the best, but consider involving those who will be willing and active participants as well as those whose opinions should be heavily weighed.The team should also include those who do the buying and receiving of the products along with those who actually use them. This could consist of doctors, dental hygienists, assistants, or the chief dental or clinical officer if there is one. This will allow for varying areas of experience and knowledge to be ‘brought to the table.’ For instance, the person who most often does the buying likely has a better grip on which suppliers have better service, pricing, and lead times while those who use the product know what items they prefer to use, and which they don’t and why.You’ll also want to ensure to include someone who will act as the ringleader. This does not need to be the person with the loudest voice or biggest opinion. But if at all possible, someone who is diplomatic, organized, and gets along with all would be best suited for the job. This person should help to keep the trials on track and ultimately ensure that a final decision is made.
Clinical trials and evaluations allow you to ensure you’re making not only the best possible decision for your practice but also for your clinical staff. It’s a critical step in gaining formulary compliance and mitigating your risks of purchasing poor quality or non-compliant products.To improve the likelihood of compliance, ensure to communicate that trials are the time for people to voice their opinions, and do your best to include those who will have them so those tough conversations can be had during the trial process. It should be made clear that once the formulary is made clear, people will be expected to abide by it.Although the aim is to gain buy-in and ensure your staff has the items that allow them to serve your clients best, it’s important to remember that you’re not always going to get a unanimous decision. We suggest you broach this subject from the beginning and explain to all team members that although everyone will be listened to and all opinions will be taken into account, it is simply not likely everyone will agree with every decision.Compromises may need to be made, and some frank and perhaps uncomfortable conversations may need to be had. However, with or without consensus, a final decision must be reached, and all must get on board.
Procurement decisions or strategies should never be allowed to become stale, and suppliers should never be allowed to become passive in their efforts to earn your business. Therefore, conducting trials should be an iterative process where new product options or new suppliers are vetted on a somewhat consistent basis.Once you’ve assembled your team, you’ll want to set up a formal process to evaluate and document outcomes. There are many options on how you go about this, and the final format depends greatly on the size of your team, as well as your organizational structure (who does and decides what.) However, here are a few things to consider:In the end, you want to ensure all factors are weighted in the final decision making, but give thought to your organization’s structure and who should analyze and consider what into their decision-making process.You’ll want to create a trial form that is to be completed upon execution of the trial. Consider if you want to provide a price, lead time, and any other pertinent information that should be weighted into team members’ evaluation and decision making. If procurement data is analyzed by management, then you may want team members to evaluate the product only.Below is a list of items you may want to include on your trial form:
You’ll also want to provide a simple but structured rating system. For example,
Lastly, you may want to give thought to asking specific questions. Such as:
Once you are ready to start your trial process, obtain samples. Note that samples are often provided at no charge by the manufacturer, so it’s at least worth the ask. It also provides you an opportunity to let them know that you are implementing a trial procedure and are maturing your procurement practices. This may motivate them to step up their game and ensure they sharpen their pencils and provide you their best possible service.Lastly, the trial procedure should be a valued one, not a rushed one. Keep in mind that some items may require a second lengthier trial. At the end of the day, you want to make sure you’re selecting the right items for your practice, your patients, and your bottom line.
Alright, now it’s time to review your results and decide on steps forward. Firstly, you’ll need to gather your trial information in an easy to review/ access format, and hopefully, one you can easily refer back to later. This could be as simple and dropping all the data into a spreadsheet and averaging out the scores.However, when reviewing the results, don’t just rely on the average, take your time to review them individually, look for “outliers,” scores that vary greatly from the rest, as well as any comments noted. You may find something very well worth considering.You’ll also want to set your “pass” and “fail” scores. If you’ve used the 1-5 scale, then likely a 3 would be considered a pass. If you use a 1- 10 score, anything over a 5 would be a pass, you get the idea. Also, beyond assigning a pass/ fail, you’ll want to compare this trial to other trials for like items, if there are any. And at some point, there should be.Approving more than one supplier for your critical goods mitigates your risk of shortages, but also sets you up for creating a more competitive landscape so you can start to leverage your volumes and drive some serious cost savings. For these reasons, you may want to give consideration to setting a secondary formulary to act as your plan b items.This way, if an item is out of stock, lead times get significantly extended, or the price skyrockets, you have a second option already approved. This limits your reliance on a particular vendor, but it also has the added benefit of showing suppliers that price increases or decreases in service levels will have an immediate impact on their sales, making them more likely to keep them in line.
Although at first, you may want to focus on qualifying only the most aggressively priced suppliers, in order to actualize cost savings as quickly as possible, in the long run, this may not be your best strategy.At all times, you’ll want to ensure alignment of values in your decision-making. For more clarity on that, pop on over to Value Setting- Price. Quality. Service.However, focusing on quality first may put you in a better position to get it all. Here us out.In the end, your goal is to purchase the most preferred products, receive optimum service, and get it all at the best possible price. So, one could say, that a good strategy may be to start by qualifying what you consider to be the “best” items.Even with the most robust supplier relationship management efforts, it’s not likely you’ll have much influence on a manufacturer’s level of quality. If you’re lucky, with some work, you may be able to improve service levels at best. Price, however, is always negotiable.
It’s important to remember that salespeople are often hesitant to reduce pricing if it’s not likely to get them a sale. And of course, people often have good intentions, but fail to follow through, negotiating better pricing but then not shifting over the volumes, which leaves the salesperson having to explain what happened to management.Once a supplier knows they are qualified, and that you have control over your procurement practices and can execute on agreements, you can make it clear to them that the remaining barrier to awarding them more business, pricing, is theirs to remove, and they should be more likely to do so.When it comes to pinching your pennies, it can be tempting to get carried away, piecemealing your orders out to the lowest price bidder for every item. In order to improve the profitability of your dental practice it’s important you factor in more than just cost per item. If you haven’t already, find out more about the pitfalls that may be taking a bit out of your profits in When Every Penny Counts: The Pitfalls of Dental Procurement That May be Biting Your Bottom Line.Supplier selection and strategies go a long way in ensuring a process that affords you long-term cost savings so you can continue to leverage your trial results and your volumes.
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