The Purchasing Paradox

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There is so much breadth and depth to today’s imaging marketplace that many radiology centers find themselves struggling to make sense of it all. As a result, growing numbers of organizations shopping for equipment end up with systems ill-suited to their needs and systems fated to fall short of meeting expectations and satisfying users, patients, and referrers.
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Sean Burke
Sean Burke, chief marketing officer of the Americas for GE Healthcare, Waukesha, Wis, says, “Imaging-system purchasers are confused about the choices available to them, which poses potentially big problems as they seek to develop their technology strategies. Without a clear technology strategy to undergird their purchase decisions, making confident strides forward becomes challenging—sometimes, unduly so.” Burke can be considered an authority on such matters, having recently directed an ambitious, 18-month research project aimed at shedding new light on how imaging providers think through their plans to bring aboard big-ticket systems, whether in replacement of older, outdated machines or as never-before-used types of equipment. “We gained considerable insights from that study," Burke says. "Some of what we learned validated things we already thought we knew about the customer decision-making process. Some of what we learned proved to be surprising.” Driven by Consensus One of those surprises was the stronger-than-anticipated role played by stakeholders who lack authority to make purchase decisions, but who nonetheless exert influence over selection. “We found that it’s not so much the modality itself or the internal politics that acts as the driver of the purchase decision; rather, it’s the organization-wide consensus that emerges about the need to acquire this or that piece of equipment,” Burke says. A related surprise was that while some purchasers may be confused about the market and the scope of the products contained therein, no such bewilderment exists when it comes to intended use of the equipment. Customers know what they want to accomplish with a new system; it’s just that they don’t know which system is the most appropriate one for the task. “One customer we surveyed gave a great illustration of this dilemma by comparing it to the thought process of how you or I might go about deciding which pair of shoes to put on in the morning,” Burke says. “You open your closet door, and there, in front of you, are the choices of dress shoes, running shoes, or hiking shoes. Each pair is different, but each will fit your feet and generally do a good job of providing protection and comfort, but only one of those pairs will be right for the specific activity you plan to engage in that day.” Burke continues, “Let’s say you’re going to be participating in a marathon race that morning. The dress shoe and the hiking shoe will clearly be the wrong choices for that activity. They’re perfectly good shoes, but not for this application. It’s much the same with imaging technology. The capabilities and features of the various systems may all be excellent, but one is almost certainly going to be better suited for a particular need than the others.” Three Types of Need The shoe analogy proves especially apt in view of GE Healthcare researchers’ observation that customer needs are divided almost universally along three lines, each of which can only be properly satisfied by an appropriate hardware–software package. “There are situations when organizations want to reach the cutting edge—or if they’re already on the cutting edge, to push themselves even further out along it,” Burke says. “This could be the case for private practices striving to differentiate themselves in a very competitive market.” Burke adds that academic centers often try to address this need because the cutting edge is what they’re all about in the first place. He says, “Then, there are occasions when customers want to boost productivity. Perhaps the reason they want productivity is to increase patient throughput and so be able to serve more patients in the span of a day. Perhaps they want productivity in order to make more time available to spend interacting with patients or for exam preparation.” In addition, he explains, “There are occasions when customers want essential functionality. They simply want to be able to provide an imaging service, usually for the very first time. We see this throughout our global markets. Domestically, we see this frequently among organizations that are investing in new technology for the first time or those that already have a primary scanner and would like additional equipment to serve more fundamental needs.” No Single Trigger Burke’s research detected no single trigger that prompts an organization to begin exploring the market in preparation for a technology acquisition. “It’s more of a confluence of multiple variables,” Burke explains, noting that these can include a sudden awareness of competitive threats or a burgeoning sense of optimism about the future. “Perhaps the reimbursement climate has changed or the composition of the local market is shifting.” Time itself can be a trigger: A piece of equipment has reached the end of its useful service life, or it is outmoded, with no possibility of an upgrade. Something else that Burke and his team observed was that customers greatly prize good communication with vendors. “They want, from the seller or supplier, information about product upgradability, about new products in development, and about ways to optimize user training,” he says. “They want to know as much as possible about how the vendor is going to help them.” Moreover, customers expect vendors to tailor their help to suit the customer’s unique situation. “They don’t want their vendors to take a one-size-fits-all approach,” Burke says, “and they want to be supported throughout the entirety of the ownership experience, not just during the purchase process.” Of course, customers’ decision making now takes place within the context of a global recession, which means that many organizations are taking a much more cautious approach involving greater internal deliberation before acting. Others find that they must avoid letting panic stampede them toward a particular equipment choice. What the recession has not done, however, is push thinking about equipment purchases to the back burner. “The economic situation is certainly top of mind for everyone,” Burke says, “and there are certainly a number of sites looking at this downturn as an opportunity to solidify their positions in the market.” Robust Research Burke believes that his company’s research into customers’ decision making processes is the most detailed and robust that GE Healthcare has amassed to date. “We went to these great lengths to compile this research because of the importance we place on understanding our customers and the problems they are attempting to solve,” he says. Those lengths included use of both quantitative and qualitative measurements of a broad-based cohort across the spectrum of modalities in every corner of the globe. “Some of what we did involved focus groups, some of it involved site visits, and some of it relied on mailed surveys and direct polling of attendees at major events, including RSNA,” Burke says. “We also relied, to a substantial degree, on customer observation by our design teams. We had in place a number of advisory boards and feedback sessions with customers to validate what we were learning.” The bulk of the research was complete in early 2008. The company then promptly translated the gathered knowledge into action. “We’re applying what we’ve learned so that we can help better support customer strategies in the purchasing process,” Burke says. “One way is by working more closely with the customers’ administrators to identify their strategies and key purchase criteria. For example, we might have a discussion in which we first ask the administrator what he or she and the purchase-decision stakeholders of the organization are trying to achieve. By the way, we recognize that the stakeholders can include not just the radiologists, but also the technologists and the referring physicians.” Burke adds, “Another way we’re applying what we’ve learned has involved a redesign of our go-to-market approach. Our objective here is to make it easier for customers to arrive at their purchase decisions. Specifically, we’ve introduced three new sub-brands that correlate with the three primary wants of customers. The sub-brands are Discovery, for those customers who want the cutting edge, and want to push the capabilities of what’s possible; Optima, for those customers who want versatility and productivity for a wide range of patients; and Brivo, for those customers who want a practical package of straightforward functionality.” Future Innovation Burke stresses that these three sub-brands are not simply naming conventions of a different stripe: They are self-contained value propositions. “Going forward, new products will be developed, announced, and launched according to this framework and around these three value propositions,” he says. “Over time, we’ll continue to launch more and more products across the three sub-brands in a way that has consistent clarity around the capabilities of each product.” Existing GE Healthcare products, such as Lightspeed, will maintain their own names, Burke says. “They won’t be renamed or folded into these three value propositions. The new sub-brands represent an entirely new way of looking at how we develop products and technologies in our R&D roadmap to support customer needs.” He continues, “We’re not only simplifying things for customers, but also providing great clarity internally for our own organization, to help us be truly focused on the different needs that customers have. We’ll continue to be an innovative technology player, but we’ll also be acutely aware of the need to solve customers’ problems. Rather than merely rolling out a stream of new technologies and new specs, our approach, from here forward, is to work with our customers to ensure that we’re coming up with solutions that are meeting their needs.” Burke concludes, “We can now say, with greater confidence, that we understand the process of how customers make purchase decisions, and we believe this understanding will benefit them and the entire industry.”