Healthcare Reimagined

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• Healthcare Re-imagined
• Stanford Presentation
• Sourcing
• Re-Imagined
• Mike Eggleston
• Diane Betti

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(No Transcript)
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Over 125 years of leading-edge technology and
performance

• 1879
• LIGHT BULB
• Edison invents the first carbon-filament
  incandescent lamp

2006 LIGHT BULBS AND SO MUCH MORE.
Only Company still on Dow Jones Index from
original 1896 list
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GE is a Family of Six Businesses
Commercial Finance
NBC Universal
Industrial
Healthcare
Infrastructure
Consumer Finance
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GE Healthcare
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GE Healthcare broad and deep
Clinical Systems
Diagnostic Imaging
Interventional Cardiology Surgery
Medical Diagnostics
Healthcare IT
Life Sciences
Healthcare Financial Services
Enterprise
1B RD portfolio
Services
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Healthcare trends

• Toward patients
• Increased patient responsibility power
• Genomic revolution toward prediction
• From post-symptomatic diagnosis To
  Pre-symptomatic detection
• Clinical convergence
• Diagnostic tests (in-vivo in-vitro)
• Diagnosis linked to therapy
• Convergence of pharma and diagnostic industries
• Productivity driven
• Payors demand rigorous cost/benefit Analysis and
  health technology Assessments
• Information driven
• Integrated, accessible, personalized actionable
  patient information

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The healthcare dilemma

• Clinician
• Pressures
• Time pressure
• Patients who cannot pay for need
• Requirement for faster, better patient
  information
• Uncertainty over service reimbursement
• Staying up-to-date on medical practice

• Provider
• Pressures
• Pay-for-performance
• Quality care/safety data transparency
• Heavy financial constraints
• Staff retention
• Academic reputation/rating
• Efficiency targets

• Payor Pressures
• Employer/customer demands
• Competition for beneficiaries
• Cost-cutting and profitability under the rising
  costs of healthcare delivery
• Safety and quality of care

Challenging the ability to deliver better
outcomes and patient care
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Only GEa unique collection of expertise
Information Technology
Imaging and Intervention
Molecular Diagnostics
Pharmaceutical Solutions
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How does Sourcing fit?
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Need a fundamental change
Heart Disease
Cancer
Brain Disorders
50 die after 1st heart attack
One person in three will have cancer
20 aged 75-84 suffer from Alzheimers disease
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GE Healthcare

• Addressing the biggest challenges in healthcare
• Creating transformationalmedical technologies
• Detecting disease beforethe onset
• Treating patients in the most effective, least
  invasivemanner possible
• Shaping a new age in medicine

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Challenging business environment

• Shrinking global reimbursements
• Ongoing op margin challenges
• Stiff competition
• Technology is changing
  at a blistering pace

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Sourcing Re-imagined
Strategic relationships
Squeezing for price
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Sourcing Re-Imagined.major culture shift
Action Needed
How To Do

• Strategic Suppliers relationship
• Clear expectations on both sides
• Meeting business needs (Q/D/P)

• Parts Classification/tech knowledge
• Industry stds/standardization
• Target costs/cBOMs

Performing Supply Base
Business Enabling Tools

• eNPI/Cadence drop down access?
• GEMSBuy lock out
• Oracle lock out

• Easy Access to strategic suppliers
• Early supplier involvement in design

Sourcing Enabling Tools

• Long term commitments to supplier
• Clear Q/D/P expectations delivered
• Target costs/should costs articulated

• Strat. Supplier Alliance Agreement
• ABA Annual Business Agreement
• RFP/RFQ template Prod knowledge

Sourcing Skill Set

• Technical vs Commercial
• Collaborative vs Aggressive
• Market product knowledge

• Engineering/Commodity Discipline
• Tenure in roles
• Sourcing Discipline rewarded

Reinforcing Metrics

• Shared Business Metrics
• Eliminate sourcing focused metrics

• Total Cost vs Cost Down
• No LCC/Supplier consol alone

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Call to arms for change
6300 partners impossible
Todays Landscape
Tomorrow
Parts 125,000
Countries gt 40 Suppliers
6300 Avg spend/supplier
240K
? 50
? 90
? 15X
4 PFs FM, PWA, Plastics, CH
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Strategic supplier alliances
GE Benefits
Supplier Benefits
Engineering capacity Support
requirements Improved Quality Grounded cost
baseline Eliminate transfer churn Knowledge
retention Stability in supply base
Business opportunities Market Trend
Knowledge Reduced internal costs Ability to
influence design Eliminate factory churn Clear
expectations Customer Stability
A marriage not a speed date
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Strategic supplier expectations

• Technology capability
• Critical technology leader
• Investment design
• Breadth of technology offering

• Capacity
• Utilization rate
• Expansion
• GE dependency

• Risk responsiveness
• Financial stability
• Ownership
• Responsiveness

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MR early supplier engagement
Next Steps
HDv MR Current Status

• Execute execute execute
• Plans beyond prototypes / clinicals
• Kick-off long-lead equipment procurement
• Initial FAI on clinicals (trial run)
• Next round of production pricing roll-ups

• Supplier presence on-site for partnership
• Supplier (PWAs / HLAs)
• Supplier (Cables Harnesses)
• Supplier (XGA/XPS HLA prototyping)
• Supplier (cabinets)
• Value to engineering mfg
• Collaborative ICV reduction initiatives
• Increased engineering capacity
• Prototype supplier production supplier

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Highlighted activities (for example)
Supplier A

• Stream line information flow into Suppliers
  systems
• Daily interface
• DFM / DFT
• ECOs and deviations, real time communications
• Lean work outs for process capability
• Daily progress / tracking
• Bi-weekly onsite for DFM / DFT / DFX

Supplier B

• Standardization to industry global requirements
• Direct Supplier Design Involvement
• Daily direct interaction with engineering team
• DFM / DFT
• Component Tooling inputs for cost designed out
• Lean work outs for process capability
• Prototyping / Clinical material requirement

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Lessons still learning

• Not just a sourcing initiative other functions
  must engage early
• Sourcing Leader role more critical requires
  earlier engagement
• Program design scope changes as program matures
  needs frequent reviews
• Suppliers flexible, but not always the best thing
• Supplier resources tools timely availability
  critical
• Target costing suppliers want this need to
  learn

 
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Were on our way!
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(No Transcript)