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KLAS Analyst: Vendor Selection Consulting Market Shifts

March 11, 2017
by David Raths
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As clients seek advice on broader array of systems, methodology and objectivity trump knowledge of specific EHR platforms

As the electronic health record software marketplace has matured, the requirements health systems place on consultants in the vendor selection process have changed, too. “Vendor selections have moved upstream and turned into more of a strategic assessment of whether a client should even go to a vendor selection,” said Warren Whitford, a KLAS research director in the healthcare consulting and value-based care space.

Orem, Utah-based KLAS Research has just published a report authored by Whitford, “Vendor Selection: Crucial Factors to Consider When Choosing a Consulting Firm.”

Healthcare Informatics spoke with Whitford about some of the report’s findings and changes in the marketplace. He noted that four or five years ago, when a vendor selection happened, it was very straightforward. “There might have been 10 vendor solutions involved, and the key skill expected from a consulting firm was to understand all the nuances, features and functionalities of the solutions, he explained. That was highly differentiating, he added. If you had a team of consultants who knew everything about Epic, Cerner, Allscripts, McKesson, NextGen and athena, then you were a successful, highly-sought-after firm. That knowledge was the key. “Now what we see is that half of these selections are more assessment/strategy type engagements, where they are coming in earlier in the process and assessing whether the health system should even go to a system selection.” The client might have a Siemens system or Meditech 5.1. Should they even think about switching? “That is where the selection work has started — at a higher level," he explained.

Conversely, he said, if you are a midsized or larger organization, you are much more likely today to skip hiring a vendor selection firm if the choice is just between Epic and Cerner. But firms are being consulted for a wider range of ancillary systems. “Three years ago, we didn’t see a lot of variability in the type of selection work,” Whitford said, “but now we are seeing firms doing selections outside the acute or ambulatory EMR. You have population health, business intelligence, revenue cycle, ERP and even some telehealth vendor selections.”

Because of that broadening out, the factors that clients weigh when considering different firms has shifted. “The No. 1 factor used to be expertise or knowledge,” Whitford said. “Now it is leaning heavily toward methodology. The other big factor is objectivity. If you show any sign as a consultant of bias or lack of objectivity in the engagement, that is seen as a highly negative attribute.”

Consulting firms that start pushing their implementation services during the vendor selection phase risk turning off their clients, he added. “Clients start to feel like they are being pushed toward a specific vendor because of that desire to get the implementation work. It is critical for these firms to separate the two engagements and not proactively attempt to position their implementation services during the vendor selection process.”

The market for EHR vendor selection consulting hasn’t changed much recently. Aspen Advisors was purchased by Chartis Group. Whitford called that a fairly successful acquisition from a customer experience standpoint. “Sometimes these acquisitions can be fairly disruptive and lead to a decrease in client satisfaction,” he said, ‘but it feels like the Chartis/Aspen deal was an outlier from that. It was a good cultural fit, and both organizations have remained high performers.”

In fact, most of the firms rated in this segment score very high this year as they have in the past. “Typically consulting firms in IT advisory work tend to be the highest performing segments we measure overall,” Whitford said. “In fact, within the IT advisory segment, the market average is roughly 91. If you can’t be a high-performing firm in this kind of work you cease to exist. There is a very high bar.”




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