Insight

Reduce Launch Mortality Risk


Who will hear the next swoosh in health tech from the mighty swish? Does Amazon’s acquisition of PillPack drive convergence with Smart Adherence?

Several of our #startup CEOs and #medication #adherence #pharmacy clients asked us about the impact of the latest Amazon acquisition on their own business models, funding, and go-to-market plans so we thought we’d share our view. This acquisition can only accelerate the convergence trend we’re already seeing between door-to-door medication delivery companies like PillPack and smart adherence. PillPack offers frictionless fulfillment, delivery convenience, Pharmacy OS, #retailhealth, and text reminders. We see that this need for convenience and supply chain fulfillment will merge with #healthcare companies offering smart blister packs, pill bottles, and pill boxes. Smart adherence solutions don’t have to rely on data entry to text questions on mobile phones (when did you take your meds?). Also, Smart Adherence collects data continuously and passively (without data entry) and allows for #Precisionprescribing interval dosing data for improved adherence. Reimbursement that pays prescribers and pharmacists to review smart packaging data insights for follow-up helps drive convergence further. Here’s the snapshot of the landscape in delivery and smart adherence. #specialtypharma


Reducing Post-Acute Care Costs With Wearable Technology—Part 1

SUMMARY

In Q4, 2016, VenAdvisory®, a digital health commercialization firm, evaluated the product-market fit for an innovative, first-to-market wearable mobile solution for patients recovering from total-knee and total-hip replacement surgeries.

The solution called Breg Flex is designed to accelerate patient recovery anywhere, anytime for total joint replacements. Flex supports conservative therapy before surgery and recovery from sports injuries. Unique to Flex is the use of visual coaching and gamification. The visual coaching relies on a real-time avatar; a likeness of the patient performing exercises that are displayed on a mobile tablet. Under watchful observation, patients are motivated to perform their daily exercises. Outcome results are captured automatically and reported to a patient panel progress dashboard for care team review. 

VenAdvisory interviewed over 50 organizations, key opinion leaders, physicians, physical therapists, and patients to determine the proof points for this innovative, wearable recovery solution. We reviewed over 100 peer-reviewed publications for strategies to reduce Total Joint Replacements (“TJR”) costs while improving outcomes. We identified that Flex can reduce post-acute care costs. These costs account for approximately 40 percent of all total knee (TKA) and hip replacement (THA) spending during the 90-day episode period.1

The VenAdvisory study found that approximately $1,500 to $2,000 can be saved on average, with Flex for each $20,000 THA and TKA Medicare patient (i.e., Comprehensive Care for Joint Replacement (“CJR”).2,3 The interview results also identified that Flex addresses remote patient monitoring needs, particularly patient adherence to prescribed home therapy treatments, management of pain and avoidance of potential complications that leads to emergency department (ED) visits and readmissions. The study was sponsored by Breg.

 


POST-ACUTE CARE SAVINGS OPPORTUNITIES

Medicare’s Bundled Payments for Care Improvement (“BPCI”) and CJR programs have made significant progress in reducing implant costs and the average length of stay. Similarly, commercial payer payment models for TJR have incentivized providers to shift patients (under age 65) away from inpatient surgeries to 24-hour ambulatory surgeries and discharge.4

Still in 2017, significant opportunities remain to save further cost and optimize outcomes in post-acute care (“PAC”) discharge services. How then, can these PAC costs be further reduced? How can patients benefit from accelerated patient recovery in the comfort of their home while provider confidence in patient adherence is addressed in near real-time?

As episode of care reimbursement and incentive models evolve and clinical pathways change quickly in response, what emerges is a delicate balance that must weigh patient risk factors.5 How to safely balance - reductions in length of stay, steerage to ambulatory surgery, shifts in discharges away from skilled nursing facilities to home and reductions in home health and physical therapy visit costs without spikes in ED visits and readmissions.

 
 


DISRUPTIVE INNOVATION

Reducing Post-Acute Care Blind Spots With Smart Wearables For Total Joint Replacement Surgeries

Clayton Christensen talks about disruptive innovation in healthcare when technology shifts care outward; when care is decentralized, scalable, evidence-based and personalized. VenAdvisory evaluated one such disruptive innovation for orthopedic episodes of care. The firm found that while a variety of wearable sensors, such as watches, devices, patches, and monitors, have been adopted by individuals, their use to support personalized rehabilitation treatments by providers has been much more limited. The firm sought to validate the product-market fit potential for Flex, a new wearable sensor technology for orthopedic episodes that combines a mobile application, gamification, behavior change, telehealth, care coordination and augmented reality with current orthopedic episode pathways. VenAdvisory sought to validate proof points and test go-to-market assumptions. These assumptions included whether Flex and its business and clinical process models could:

  1. Simplify patient transitions to the home

  2. Work within existing provider workflows, including EMR usage

  3. Accelerate patient recoveries while also improving outcomes and avoiding readmissions and ED visits

“Sensor technology is the wave of the future"
—SVP, Academic Medical Center


OUR FINDINGS

Equally important is the patient perspective. Can the patient experience be improved by reducing the out of pocket expense, time and commute to outpatient therapy? 

At three independent sites, orthopedic surgery practices prescribed a prototype (wearable device and mobile application) to 25 patients undergoing either a hip or knee replacement surgery. Detailed patient interview feedback was collected in 2016 and early 2017 regarding their recovery experience using Breg Flex.

 
 

Higher high functional improvement

Number in percentage (%)
 

Patients had 20% higher high functional improvement scores at discharge compared to the national average 6


Physical therapy visits

Number in percentage (%)
 

Wearable device wearing patients resulted in 25% fewer physical therapy visits 6


Patients compliant with home exercise

Number of percentage (%)
 

75% vs. 30%

75% of wearable patients were compliant with home exercise programs, compared to 30% for non-wearable patients 6

 

To better understand patient motivations and preferences, we also uncovered the following findings for patients from survey, interview and published data:

 

TOP BENEFITS:

  1. Instructional Videos

  2. Guided Home Exercise

  3. Flexibility in Exercise Programs (e.g., pause, restart, skip)

 
 

KEY FEEDBACK:

Would suggest wearable to a friend

Number in percentage (%)
 

100% of patients with wearable devices would suggest the solution to a friend

 

Motivation

Number in percentage (%)
 

95% of wearable users found the solution increased their motivation

 

Top priority

Number in percentage (%)
 

75% of wearable patients identified speed of recovery as their top priority

 


REFERENCES:

  1. Keswani, A., et al. Discharge Destination After Total Joint Arthroplasty: An Analysis of Postdischarge Outcomes, Placement Risk Factors, and Recent Trends. Journal of Arthroplasty. June 2016. Volume 31, Issue 6, Pages 1155–1162.

  2. Centers for Medicare & Medicaid Services. Comprehensive Care for Joint Replacement Model. Web. Accessed 1 February 2017.

  3. Alliance for Home Health Quality Innovation, “Distribution of Post-Acute Care under CJR Mode of Lower Extremity Joint Replacements for MS-DRG 470”. 2011-2014 Standard Analytical Files (SAF) Limited Data Set (LDS); 5% and 100% sample of Medicare beneficiaries, All Part A and Part B Care Settings.

  4. Harris Meyer, Replacing joints faster, cheaper and better? Modern Healthcare, June 4, 2016

  5. Yao, Dong-han, et al. Home Discharge After Primary Elective Total Joint Arthroplasty: Post discharge Complication Timing and Risk Factor Analysis. Journal of Arthroplasty. February 2017 Volume 32, Issue 2, Pages 375–380.

  6. Breg. Breg Flex: Mobile Patient Therapy Monitoring for Value Based Care. Results of observational studies of patients. Carlsbad: Breg, 2017. Print.

  7. Wang, Li., et al. Does preoperative rehabilitation for patients planning to undergo joint replacement surgery improve outcomes? A systematic review and meta-analysis of randomized controlled trials. BMJ Open. 2016 Feb 2;6(2): e00985.

  8. D. Santa Mina, et al. analysis. Physiotherapy 100 (2014) 196–207.

  9. Brown K., et al. Prehabilitation and quality of life three months after total knee arthroplasty: a pilot study. Perceptual & Motor Skills. 2012;115(3):765-774.

  10. Snow R., et al. Associations between preoperative physical therapy and post-acute care utilization patterns and cost in total joint replacement. The Journal of Bone and Joint Surgery. 2014 Oct 1;96(19): e165. Web. Accessed 12 Feb. 2017.


To be continued: This insight is Part 1 in a series of four parts.

A full download of the article will be available at the end of the series. 

 

Reducing Post-Acute Care Costs With Wearable Technology—Part 2

MAKING FAST RECOVERY A GAME PATIENTS WANT TO WIN

Providers need to be confident that patients will follow their treatment plans. Once patients leave their practice site, providers have no automated way to monitor the patient’s levels of pain relative to exercises completed, complications, functional status and compliance to recommended exercises. If patients do not follow their treatment plans, providers may be challenged with unsatisfactory patient outcomes. 

We interviewed several Physical Therapists (PT) and identified that the hardest part of physical therapy is often that patients simply do not understand the exercises or how to perform them in a nuanced way. Also, many factors are at play in patient adherence to exercise regimens:6

  • Patient motivation

  • The exercise’s role in overall rehabilitation

  • The physiotherapist’s “verbal” and “visual” explanation

  • The quality of physiotherapist’s explanation and patient interaction

  • The physiotherapist’s reassessment of home exercises and patient satisfaction.

With the wearable device and app, not only were patients able to view their data, but patients received real-time visual coaching via an avatar or likeness of themselves. 

Many interviewees spoke to the “Hawthorne Effect.” When we told the story of how the solution brings the know-how and the watchful eyes of the PT and doctor into the patient’s home, patients responded that they felt encouraged, supported and held accountable, particularly when pain levels (VAS) were high. Furthermore, PTs also commented that sensors could save data entry time by automating the capture of vital functional outcomes data used in Hoos, Koos, WOMAC surveys that were required for quality reporting purposes. Also, PTs felt that mobile communications, including telehealth chats could help patients stay motivated and compliant. PT’s felt this form of communication would be effective for patients requiring multiple visits when annual therapy caps were reached. Reactions to the “avatar” likeness of the patient on tablets and real-time visual coaching was favorable; viewed by patients as a way to guide them to correctly perform exercises in their homes without the need for special equipment or large TV screens. The transparency of the data and patient status dashboard meant that patient recoveries could be monitored by the entire health team, including updates to the Orthopedist before a post-operative visit. As star players with coaches watching over them at any moment, patients were held accountable. The gamified experience coupled with motivational check-ins and encouragement led patients and PT’s alike to respond with “who wouldn’t want to play to impress?”. The most significant motivation was for patients to see and experience tangible progress, reinforced by a wearable application, in getting their activities of daily living back in order.

SECTIONS

Making Recovery a Game

Preparing for Success

References

 
 Breg Flex wearable

Breg Flex wearable

 


PREPARING FOR SUCCESS: PRE-REHABILITATION AND PATIENT EDUCATION

Benjamin Franklin famously said, "by failing to prepare, you are preparing to fail.” Providers are finding this statement holds true for CJR episodes, particularly when pre-rehabilitation (“Prehab”), can be performed before surgery. Prehab involves patient education, pre-operative PT and home exercise services. 

VenAdvisory spoke with organizations that used inter-disciplinary care teams and clinical pathways for TJR. Several organizations also require patient enrollment in education classes before surgery. The classes level set patient expectations effectively and lay out a plan of preparatory activities leading up to and following surgery. The classes also create opportunities to assess patient risk factors before surgery. Several of these organizations were using Prehab, some were not. 

Published, peer-reviewed studies show varied results for Prehab.7,8,9 In these instances, it was helpful to review meta-analyses that consider account sample sizes, risk of bias and study quality to weigh the net result of an intervention. A meta-analysis of 21 studies published in Physiotherapy in 2014 concluded that Prehab not only reduced length of stay, pain, complications and improved function, but it reduced cost.8

 

Resulting post-acute care use

Numbers in percentage (%)
 

A 2014 study published in the Journal of Bone & Joint Surgery (JBJS)10 found that “the use of preoperative physical therapy was associated with a significant 29 percent reduction in post-acute care use,” including the use of skilled nursing facilities, home health agencies and inpatient rehabilitation. This shows that prehab can and should be a valuable part of a CJR services package. While prehab services can increase costs (they are outside the CJR index event period), they can generate a positive return by reducing post-acute services and create a foundation for successful patient recoveries.

“The ability to see patient functional status before surgery would be key. It would inform the risk assessment with greater confidence in functional status than the patient interview.”
—Orthopedic Service Line Manager, Health System

 
 


REFERENCES:

  1. Keswani, A., et al. Discharge Destination After Total Joint Arthroplasty: An Analysis of Postdischarge Outcomes, Placement Risk Factors, and Recent Trends. Journal of Arthroplasty. June 2016. Volume 31, Issue 6, Pages 1155–1162.

  2. Centers for Medicare & Medicaid Services. Comprehensive Care for Joint Replacement Model. Web. Accessed 1 February 2017.

  3. Alliance for Home Health Quality Innovation, “Distribution of Post-Acute Care under CJR Mode of Lower Extremity Joint Replacements for MS-DRG 470”. 2011-2014 Standard Analytical Files (SAF) Limited Data Set (LDS); 5% and 100% sample of Medicare beneficiaries, All Part A and Part B Care Settings.

  4. Harris Meyer, Replacing joints faster, cheaper and better? Modern Healthcare, June 4, 2016

  5. Yao, Dong-han, et al. Home Discharge After Primary Elective Total Joint Arthroplasty: Post discharge Complication Timing and Risk Factor Analysis. Journal of Arthroplasty. February 2017 Volume 32, Issue 2, Pages 375–380.

  6. Breg. Breg Flex: Mobile Patient Therapy Monitoring for Value Based Care. Results of observational studies of patients. Carlsbad: Breg, 2017. Print.

  7. Wang, Li., et al. Does preoperative rehabilitation for patients planning to undergo joint replacement surgery improve outcomes? A systematic review and meta-analysis of randomized controlled trials. BMJ Open. 2016 Feb 2;6(2): e00985.

  8. D. Santa Mina, et al. analysis. Physiotherapy 100 (2014) 196–207.

  9. Brown K., et al. Prehabilitation and quality of life three months after total knee arthroplasty: a pilot study. Perceptual & Motor Skills. 2012;115(3):765-774.

  10. Snow R., et al. Associations between preoperative physical therapy and post-acute care utilization patterns and cost in total joint replacement. The Journal of Bone and Joint Surgery. 2014 Oct 1;96(19): e165. Web. Accessed 12 Feb. 2017.


To be continued: This insight is Part 2 in a series of four parts.

A full download of the article will be available at the end of the series. 

 

Reducing Post-Acute Care Costs With Wearable Technology—Part 3

PROVIDER MOTIVATIONS 

In our interviews with executives from 20 different top-tier provider organizations, we asked how wearable technology might support their patient care models and businesses. Below are highlights from these interviews. 

 

Key Provider Motivations:

  • Optimize Outcomes

  • Gain Visibility into Patient Recovery

  • Provide Excellent Patient Experience

 

During our product-market fit interviews and research, we identified several key benefits for a wearable mobile solution among various stakeholder groups involved in TJR surgeries.


TOP BENEFITS FOR PHYSICIANS:

  1. Outcomes Reporting/Dashboard (based on objective data)

  2. Remote Care Monitoring

  3. Patient Reported Outcome Measures


TOP BENEFITS FOR PHYSICAL THERAPISTS:

  1. Patient Compliance/Accountability

  2. Care Coordination

  3. Consistent Patient Education


TOP BENEFITS FOR ORTHOPEDIC SERVICE LINE ADMINISTRATORS:

  1. Outcomes Reporting/Dashboard (based on objective data captured from sensors)

  2. Patient Reported Outcome Measures

  3. Syncing of patient outcomes results and patient clinical data with the EMR to provide a more complete picture


TOP BENEFITS FOR PATIENTS:

  1. Instructional Videos, Visually Guided Home Exercise, Telehealth Connection to Provider

  2. Convenience—Can be used anywhere, anytime

  3. Flexibility in Exercise Programs (e.g., pause, restart, skip)


TECHNOLOGY SOLUTIONS MUST SOLVE IMPORTANT PROBLEMS

During the interviews, we consistently heard the need for proof points to demonstrate new technologies and processes. We heard that sales teams approach healthcare organizations and orthopedic practices with new technologies every day. Yet, providers are reluctant to adopt new technology unless it can solve a critical problem, integrate with clinical workflows, save time and money and has a pre-existing business model (i.e., reimbursement). And rightly so, since new solutions involve changing how some clinicians are doing their jobs today. Providers do not favor treating patients differently or practicing differently due to different reimbursement models. The investment in changing protocols or caring for patients outside the hospital and practice site must save time and be worthwhile. Integrated solutions, via wearable sensors and smart mobile devices, that aid patient recovery while automating the reporting of results and events (complications, pain scores) can pay off when scaled across multiple orthopedists and broadly adopted by patients. This applies to both episodes of care and traditional fee-for-service reimbursement models.

 
 


REFERENCES:

  1. Keswani, A., et al. Discharge Destination After Total Joint Arthroplasty: An Analysis of Postdischarge Outcomes, Placement Risk Factors, and Recent Trends. Journal of Arthroplasty. June 2016. Volume 31, Issue 6, Pages 1155–1162.

  2. Centers for Medicare & Medicaid Services. Comprehensive Care for Joint Replacement Model. Web. Accessed 1 February 2017.

  3. Alliance for Home Health Quality Innovation, “Distribution of Post-Acute Care under CJR Mode of Lower Extremity Joint Replacements for MS-DRG 470”. 2011-2014 Standard Analytical Files (SAF) Limited Data Set (LDS); 5% and 100% sample of Medicare beneficiaries, All Part A and Part B Care Settings.

  4. Harris Meyer, Replacing joints faster, cheaper and better? Modern Healthcare, June 4, 2016

  5. Yao, Dong-han, et al. Home Discharge After Primary Elective Total Joint Arthroplasty: Post discharge Complication Timing and Risk Factor Analysis. Journal of Arthroplasty. February 2017 Volume 32, Issue 2, Pages 375–380.

  6. Breg. Breg Flex: Mobile Patient Therapy Monitoring for Value Based Care. Results of observational studies of patients. Carlsbad: Breg, 2017. Print.

  7. Wang, Li., et al. Does preoperative rehabilitation for patients planning to undergo joint replacement surgery improve outcomes? A systematic review and meta-analysis of randomized controlled trials. BMJ Open. 2016 Feb 2;6(2): e00985.

  8. D. Santa Mina, et al. analysis. Physiotherapy 100 (2014) 196–207.

  9. Brown K., et al. Prehabilitation and quality of life three months after total knee arthroplasty: a pilot study. Perceptual & Motor Skills. 2012;115(3):765-774.

  10. Snow R., et al. Associations between preoperative physical therapy and post-acute care utilization patterns and cost in total joint replacement. The Journal of Bone and Joint Surgery. 2014 Oct 1;96(19): e165. Web. Accessed 12 Feb. 2017.


To be continued: This insight is Part 3 in a series of four parts.

A full download of the article will be available at the end of the series. 


Reducing Post-Acute Care Costs With Wearable Technology—Part 4

ORTHOPEDIC EPISODE TAKEAWAYS: REMOVE THE BLIND SPOT

“It’s nice to know in real-time which patients are the outliers.”
—Physician Orthopedic Surgeon

“The ability to monitor patient progress, post-surgery is compelling
—Chief Medical Officer, Health System

“Pain very key. Today it is captured through EMR by nurses during patient encounters, because there is a care team member to record it. If the patient is at home, there is no way to document.”
—Executive, Leading Health System

“SMART wearables in the Home remove our blind spot.”
—Executive, Leading Health System

  • Optimize Outcomes

    Support prehab, motivate and involve patients, transition more recovery to in-home settings, speed recovery times, and avoid re-admissions.
 
  • Gain Visibility into Patient Recovery

    Make patient progress visible to providers and patient caregivers at any time, and enable appropriate interventions whenever necessary.
 
  • Deliver Excellent Patient Experience

    Involve patients as a key partner in their recovery, give them tools that will help them succeed, and instill confidence that patients will be monitored every step of the way.
 

SECTIONS

Takeaways

Conclusion

References

 
 Breg Flex Wearable

Breg Flex Wearable


CONCLUSION

Orthopedic, Sports Medicine, Rehab and Physical Therapy providers want TJR patients to get their lives back. Yet under episodes of care models, readmissions, ED visits and complications, and the cost of health are borne by providers; putting their profit margins are at risk. It does not have to be that way. With the addition of wearable technology coupled with telehealth, mobile and patient event dashboards, providers can now better care for their patients without losing their bottom line, particularly in the post-acute care blind spot. 

From pre-screening all the way through to complete recovery, wearable mobile technology keeps both the patient and the provider in the know. No longer are doctors and PTs uninformed of a patient’s progress outside the practice walls and no longer are patients uninvolved in their own health. With wearable technology, patient recovery is a team effort where motivated patients, personalized recovery plans, live visual coaching can pay off. With pre-rehabilitation and post-acute care monitoring throughout the 90-day event, wearable mobile technology helps to conquer the most important factors in provider profitability in post-acute care services: avoiding readmissions, ED visits, shifting care away from SNFs to the home, and reducing outpatient PT and home health visits. 

With increasing adoption of value-based reimbursement programs on the horizon, we anticipate provider organizations will be looking for more innovative solutions such as the wearable mobile technologies that come to market.

 
 


REFERENCES:

  1. Keswani, A., et al. Discharge Destination After Total Joint Arthroplasty: An Analysis of Postdischarge Outcomes, Placement Risk Factors, and Recent Trends. Journal of Arthroplasty. June 2016. Volume 31, Issue 6, Pages 1155–1162.

  2. Centers for Medicare & Medicaid Services. Comprehensive Care for Joint Replacement Model. Web. Accessed 1 February 2017.

  3. Alliance for Home Health Quality Innovation, “Distribution of Post-Acute Care under CJR Mode of Lower Extremity Joint Replacements for MS-DRG 470”. 2011-2014 Standard Analytical Files (SAF) Limited Data Set (LDS); 5% and 100% sample of Medicare beneficiaries, All Part A and Part B Care Settings.

  4. Harris Meyer, Replacing joints faster, cheaper and better? Modern Healthcare, June 4, 2016

  5. Yao, Dong-han, et al. Home Discharge After Primary Elective Total Joint Arthroplasty: Post discharge Complication Timing and Risk Factor Analysis. Journal of Arthroplasty. February 2017 Volume 32, Issue 2, Pages 375–380.

  6. Breg. Breg Flex: Mobile Patient Therapy Monitoring for Value Based Care. Results of observational studies of patients. Carlsbad: Breg, 2017. Print.

  7. Wang, Li., et al. Does preoperative rehabilitation for patients planning to undergo joint replacement surgery improve outcomes? A systematic review and meta-analysis of randomized controlled trials. BMJ Open. 2016 Feb 2;6(2): e00985.

  8. D. Santa Mina, et al. analysis. Physiotherapy 100 (2014) 196–207.

  9. Brown K., et al. Prehabilitation and quality of life three months after total knee arthroplasty: a pilot study. Perceptual & Motor Skills. 2012;115(3):765-774.

  10. Snow R., et al. Associations between preoperative physical therapy and post-acute care utilization patterns and cost in total joint replacement. The Journal of Bone and Joint Surgery. 2014 Oct 1;96(19): e165. Web. Accessed 12 Feb. 2017.


This post is the last in a series of four parts.

To download the complete PDF of this article, please click here to complete a quick form. 

 Complete article download (362 KB)

Complete article download (362 KB)


What questions should your GTM efforts answer?

q.jpg

HOW will you stay relevant? Do you have a defined growth strategy?

WHAT opportunities exist in the near, intermediate and long-term for your solution(s) given healthcare and IT trends by customer market segment (provider, payer, life sciences, consumer)?

WHAT is the addressable market size, degree of competition, adoption, investment and level of execution required to pursue these opportunities?

WHAT is your proposed solution for targeting customers and how does it solve major customer problems (i.e., business value and outcomes)? WHO should you actively target (buyer/decision-maker personas, channels)? 
WHAT are the priority opportunities? 

WHY are you excited about these opportunities (game changer)?

WHAT is your POV for each proposed market segment? WHY are they unique?

WHAT will it take (resources, investment, IP, capabilities, CSFs, GTM strategies) to execute on these opportunities and acquire customers? WHAT are the risks? HOW will your competitors respond? 

WHAT market and financial scenarios (entry, exit, customer segment, geography, sales targets, timing, channels, business case, key assumptions) are anticipated?

WHAT proof points (customer insights) validate the GTM strategies before commitments are made? Have you validated key hypotheses and assumptions with at least 10 representative customers?

WHAT are the 60/90/180 day plans for GTM execution (priorities, objectives, activities and KPIs)?


Accelerating New Product Development with Customer Lean Validation

New Product Development (NPD) is a systematic framework for guiding processes from ideation to solution launch. The process can be represented by a funnel with many new ideas entering the discovery stage, narrowing to the most viable few for development and ultimate launch and go-to-market (GTM).

A common approach is for teams to generate solutions, rank them then build them. This assumes the teams are experts, know their customers and competition. However, it’s critical not to shortcut customer validation. Particularly, the work required to 1) gain a deeper understanding of your customer’s needs, 2) customer jobs to be done and 3) testing of the hypotheses and assumptions for your solution.    

With pressures on teams to shorten time-to-market, faster realization of value occurs when teams use lean customer validation before they launch a solution. Customer validation leads to better product market fit and higher likelihood of GTM success.

NPD1.png

According to a 2011 Booz, Allen Hamilton study, sources of innovation apply to many enterprise initiatives. Under step 1, business model tools such as Lean Canvas and inputs such as market analysis help winnow these efforts.  

NPD2.png

In step 2, the teams and management can score the opportunity using several criteria. 

NPD3.png

In step 3, teams can experiment efficiently by creating a short storyboard or brief that articulates Maximum Value Propositions and Use Cases. The storyboard should demonstrate how the solution will solve the customer Jobs to be Done and pain points. The storyboard should also incorporate key assumptions and hypotheses to be tested during the lean customer validation phase.  

NPD4.png

In step 4, organizational understanding of the solution blueprint (what you can build) and go-to-market strategies should start to emerge as customer conversations provide greater clarity on the storyboard. At this stage, it’s critical to validate your proof points, market segments, customer benefits (unique value propositions), sales process, customer adoption cycles and pricing. Equally as important is an early business case. If feasible, a business case should be developed before any further investments in resources or funding are made (i.e., “what if” modeling of pro-forma sales assumptions and revenues).  

NPD5.png

In step 5 to shorten your time-to-market and time-to-value, alternatives to coding from scratch should be evaluated, including assembly and integration of third party assets. The software architect, design, product management and engineering teams are now working side-by-side in testing and making prototypes a coded reality. Throughout this process, customer validation (deep context) continues to drive what you can build rather than a team’s strongly held beliefs or assumptions that may be lacking in evidence. A strong link should exist between testing iteratively and validation of deep customer insights.

NPD6.png

Step 6 captures the remaining steps required for full deployment and general availability (GA) of your solution. If a de novo solution, this step may include customer pilots before GA to test customer acceptance, work out corrections and to build early testimonials and net promoter scores. When pilots validate your proof points, your organization is now well positioned to make further investments, raise capital and move into full GA release. Investments can be made to ramp and scale, execute go-to-market strategies, expand sales and distribution efforts, increase customer success, roll out developments and plan for future enhancements. 

NPD7.png

Getting Your Digital Health Venture Ready for Due Diligence: Checklist

y n.jpg

We’ve seen too many early stage ventures and their teams unprepared for the due diligence process, whether to be acquired or to get funded. It’s been a painful process for many of the companies we meet and it takes tons of CEO and executive time. It involves a rigorous review of your operations, products, technology stack, sales, customers, team/management and financial condition. It also takes you away from your customers, running your business and placing you at risk with your stakeholders.
 
To help you here, we went through several due diligence investigations by investors ourselves when funding our previous companies. We prepared a checklist of 15 items you might expect. There is a wide range of investor asks and focus areas. While you may not need to cover the waterfront with all the items on this list, it should help prepare you for the basics. Basics that are likely to be covered in your conversations with disciplined angel and venture funding groups.

The Due Diligence List and Questions includes these topics:

  1. Organization and Good Standing

  2. Financial Reports, Tax Returns

  3. Business Plan & Valuation

  4. Indebtedness

  5. Human Resources

  6. Professional Services

  7. Organization Information

  8. Contingent Liabilities

  9. Contracts, Agreements and Other Arrangements

  10. Proprietary Rights

  11. Plant, Property and Equipment

  12. Insurance

  13. Product Development/Management

  14. Sales/Marketing

  15. Operations


Your Stage: Preparing for Investor Discovery

Before you start your discussions with investors or business partners, consider staging. Realizing greater value for your business is like staging your real estate for sale. When you want buyer to invest in your business, a major clean-up is required before opening the doors to potential investors.

We’ve been fortunate to help many technology companies, including some of our own, prepare for investor and partner discussion. To help you, we created this actionable, stoplight dashboard tool. It sets the stage for preparing your enterprise, team, processes and technologies for more favorable terms and in more favorable light.