We just re-wrapped up our business building block sprint on Intermediaries. This is one we previously started and put away until examining Key Influencers. In summary, we completed 2 objectives:
- Questions to ask on the canvas for the Intermediaries
- Identification and activation of healthcare Intermediaries
1st – Questions to Ask on the Canvas for the Intermediaries Block
We defined the questions that should be added to our business model canvas for helping practitioners define their Intermediaries.
- How does an Intermediary influence the Buyer?
- Does the Intermediary act on behalf of the Buyer, the Value Proposition owner, or themselves?
- What Costs does the Intermediary add to the business model?
- What Costs does the Intermediary add to the Customer Relationship?
- What impact does the Intermediary add to the Experience?
- Can the Intermediary be disintermediated?
- Is your business model an Intermediary within another business model?
- If so, can you be disintermediated?
2nd – How to Identify and Use Healthcare Intermediaries
We also built assistance for practitioners regarding the identification and use of the Intermediaries that exist in their healthcare business model. We asked how do you identify and activate/disintermediate the Intermediaries you defined in the canvas questions for the Key Influencers block?
Not all intermediaries are bad. In fact, they would not exist if there was not some flaw inherent in the business model already. No one wants to pay more or spend more time than they have to, yet many healthcare business models leave the Buyer and User utterly confused, the Value Proposition unrealized, and the JTBD incomplete.
Most successful business models started as some form of intermediary. Those that are successful now dispute their intermediary origins. The problem lies when the Intermediary becomes locked into a static model and actually works to prevent better models from surfacing. In healthcare, this has lead to run away costs close to 18% of the GDP.
But healthcare is complex, and most Buyers and Users have poor situational fluency. In this way, many great healthcare business models require a helping hand from an Intermediary to make sure a Value Proposition is understood. In these markets, Intermediaries bridge that gap and assist and improve the Customer Relationship, and as such are essential.
Furthermore, healthcare is large, containing distinct markets where only giant players can survive. This creates a natural resistance to change and usually yields profits for the company and a poor Experience for the Customer Segment. In these markets, Intermediaries force the legacy players to act on behalf of the Customer Segment, and as such are essential.
So given all of this, how do you identify and activate Intermediaries when they are needed and good, and disintermediate them when they are not?
We suggest you try to first isolate the Intermediaries by defining a canvas specific to their business model and then re-insert them back into yours based on their Key Activities, Value Proposition and Customer Relationship. We believe that this is a valid approach and can actually lead legacy businesses to rethink how they approach their own intermediaries – and possibly even seek to disrupt themselves.
In conclusion, we know that Intermediaries are an embedded part of the healthcare system. But not all intermediaries are bad. Case in point lets look at the evolution of the retail clinic, sometimes called convenient care clinics. In 2004, these clinics were seen by the American Medical Association as an unnecessary intermediary to the structure of the existing primary care doctor. Many complaints were leveled against them ranging from their lack of qualified medical practitioners to their creating a gap between the patient and their primary care physician. Ten years later, we have seen almost every general practice office staffed with NPs and PAs to create what seems to be fewer and shorter visits with the doctor. Furthermore, the retail clinics were the first practices to adopt the electric medical record en masse. This is now seen as a standard requirement for any practice. Finally, many regional hospitals have begun experimenting with opening their own retail clinics to augment their coverage and provide a smarter triage for their patients.
As part of your business model you should work to identify and activate Intermediaries when they are needed and good, and disintermediate them when they are not!
Take time to incorporate these approaches into the Intermediaries block in your business model canvas. Regardless if your business model is aimed at Patients, Providers, Payers, and or Purveyors, defining the Intermediaries between your Customer Segment and your Value Proposition is important to creating your best business model.
What is Next?
Next up we are going to look at defining Channels in healthcare business models.
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To your health,
The Team at imagine.GO