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Developing a Business Case for Healthcare Solutions - Telemedicine Ajay Asthana (asthanaajayk@gmail.com)

Objectives Making Solution Selling Easier

Challenges in selling technology solutions
Decision making is moving to front office Customers have to do-more-for-less Use a consultative approach to selling Improve outcomes from the use of technology Industry, solution, customer and sale specific value propositions Agile and Flexible easy to modify Focused on value and not function, feature and price Calculates important financial measures ROI, NPV, TCO, PP, and IRR Can be used by both value marketing and value selling Easy to enable the sales team Support the development of solution on value, customization & integration Reduces the solution selling time status quo elimination (30%)* Increases the deal size by bundling complementary offerings (30%)* Improves the win-rates in competitive situations (60%)* Reduces the risk of technology implementation
* Source: American Marketing Association 2

The tool helps in developing credible business cases

Benefits to the solutions development group

Business Case Framework for Value of Defensible Disposition

Structured Storage Unstructured Storage e_Discovery Review Application Decomm Business Transformation Operations Costs Solution Value

Total Model

Total Model

Total Model

Total Model

Process Streamlining

Hardware

P&L

Application Production

eMail & Sharepoint

Predictive Coding

Large Applications

People Effectiveness

Software

ROI / PP

+
Application Test etc. Tapes

+
Collection

+
Medium & Small App

Technology Automation

Consulting

=
Increase NPV, IRR

Backup

Backup

Review

Backup

Risk Reduction

Change Management

Reduce TCO

Benefits

Costs

Value

Diseases in Scope: Diabetics, High Blood Pressure, Congestive Heart Failure (CHF), Chronic Obstructive Pulmonary Disease (COPD) , and Depression 3

Execution Results and Demonstrating the Value of the Solution

Payback Period PP 1.48 Net Present Value NPV $415,699.526 Return on Investment ROI 1135.25% Internal Rate of Return IRR 242.66% Total cost of Ownership TCO $53,458,900

Year 1
Total In-Flows
0

Year 2

Year 3

Year 4

Year 5
203,185,118 1,200,000 201,985,118

Total
600,351,634 53,458,900 606,892,734

101,249,959 152,957,073 203,185,118 1,200,000 1,200,000 1,200,000

Total Out-flow
48,658,900

Net Cash Flow

(48,658,900) 100,392,599 151,188,839 201,985,118

Incremental cumulative inflow

0 101,592,559 253,981,396 457,166,516
49,858,900 51,733,659 82,969,057 51,068,900 52,528,900

660,351,634
53,458,900 606, 892,734 125,416,867

660,51,634
53,458,900 606,892,734 415,699,526

Incremental cumulative outflow

48,658,900

Net incremental cumulative cash flow

(48,658,900) 202,922,496 404,907,616 113,590,412 137,958,554

Discounted cash flow stream

(44,235,364)

Solution offerings for developing the value proposition

1
Solution Development Business Value Identification Sales Team Customization Why Change? Pre Sales Activity Business Value Workshop

2
Detailed Business Case Solution Sale

3
Business Value workstream Why IBM? Engagement Support ISSW Entry Point

Demonstrate Value ISSW

Why Now? Why Our Solution? Sales Acceleration ISSW Entry Point

Entry Point

1.

Business Value Identification Emerging Solutions

- Goal: Quantify value of change and prove the superior value, customized white papers, - Examples Analytics, Mobility, Healthcare Fraud and Abuse, workforce optimization etc.

2.

Business Value Workshop - Solutions with Existing Value Proposition

Goal: Diagnose the attention worthy issues, assumptions, benefits among competing alternatives Examples BPM, Telemedicine; RTLS, Digital Hospital, EMR, eReferral etc.

3.

Business Value Work steam - Customer Engagements

Goal: Engage with large implementation projects to demonstrate the value of technology transformation Examples Legacy transformation, BPM, SOA, & Mobility, Gating process support, Manulife etc.

Benefits of the Approach

1. Connect higher in customer organization (economic buyers / CFOs) value 2. Optimal solution pricing through what-if analysis improved margins 3. Improves trust by engaging the customer - consultative process and approach 4. Enables IBMs global sales force to move towards value-based selling ease of use 5. Reduces solution sales cycle time ease of customization 6. Present a One IBM view (GBS, GTS, SWG, BP) to the customer outcomes 7. Promotes complementary products and offerings based on value - holistic 8. Allows IBM to develop reusable assets using customer funding leverage 9. Provide customer value feedback to solution developers continuous improvement

Solution Architecture Connected to Framework

Business Process
Streamlining Patient Flows Streamlining Provider Flow

Lombardi

Disease Management

Care Coordination

Application Layer
Labs and Pharmacies Enterprise Resource Planning - ERP

SAP, Cerner

Electronic Medical Records - EMR

Patient Scheduling

Event Management
Event Management Event Filtering & Routing

iLog, WBE, Polycom

Rule Engine

Alerts and Triggers

Integration Layer
Intranet and Internet Connectivity

Juniper, WPS, Polycom

Process Automation and Workflow

Network Layer
Wired Network Wireless Network

Juniper,

Network Security

Network Administration

Data collection
Patient devices

iPhone, iPad, Polycom

Provider Devices

Appendix Tool Screenshots

Tool Assumptions Customizing the Value Proposition

Tool Benefits Enhancing Credibility of the Solution

10

Tool Calculations Incorporating Customer Performance Measures

11

Tool Overall Benefits Connecting Roadmap to Implementation

12

Tool Overall costs of the solution Connects to the Proposal

13

Tool ROI Calculation

14

Tool All the Financial Measures

15