The Cost Savings Factor

The Cost Savings Factor

This is the fourth post in a 4-post series reporting on an interview I did with Greg Johnson from Medtronic. Over the years, Medtronic has increased their investment in their dynamic information delivery system. They have continued to develop it and they have seen their ROI returned again and again.

The Cost Savings Factor

Even after proving to management that he would increase quality, address the audit issue, and reduce cycle time, management said, ‘yeah, but how much money can you save me in this project.’

So he told them about the benefits of reuse, automating composition, and source control.

Greg and one of the MBAs at Medtronic did formal business case model together to show how much money would be saved. The results they predicted were unbelievable. They were too stellar.  So they put in two lines:

  1. the numbers they believed in were labeled “optimistic” and
  2. numbers they made up and labeled “conservative”

The 2nd line were numbers they thought that management would believe. For example, although they believed the could get 90% reuse, they scaled it down to 50%.

And, for the record, they did reach 90% reuse. They reached every single one of the “optimistic” goals. In 2005, they had exceeded optimistic line and met or exceeded all other commitments. Greg’s team received the Star of Excellence for their business unit as well as the Medtronic Star of Excellence. A executive told Greg that they got a higher ROI than if they had put the money into another product and that his project was the “most successful project ever seen at Medtronic”.

All thanks to a dynamic information delivery system that solved the audit problem, the cycle time problem, and saved money.

And it all started when Arbortext took them to see what Caterpillar had done (starting 10 years earlier still). Greg said when they came away, he didn’t know whether they were more exhilarated or exausted at the proposition and how far they had to go.

Now they’re the inspiration for others.

Greg says, “You don’t want to do how/what we did. It’s 10 yrs later. But I want to encourage you. There are vast savings and vast reductions in cycle time and vast improvements to do in this field, if you do it smart, build your vision, and go be passionate about it.”

Previous: The Time to Market Driver and The Quality Driver

First in the series: Benefits of dynamic information delivery for life sciences

 

Series Articles:

  1. Benefits of dynamic information delivery for life sciences
  2. The Quality Driver
  3. The Time to Market Driver
  4. The Cost Savings Factor

Related Articles:

  1. Dynamic information delivery systems reduce translation costs
  2. The Benefit Content Reuse Brings to Business