The case challenges

Molecular technology has been used in microbiology laboratory diagnostic already since early 2000. However, despite its ability to provide test results quickly, it has gained the fame of a costly solution the use of which needs to be justified. Therefore, the case company tries to prove that the use of the molecular diagnostic may be affordable and that access to earlier results may bring significant efficiencies not only in terms of costs but also the quality of patients’ treatment. Furthermore, the case company wants to show that its solution can help to fight against the further evolution of antimicrobial resistance.

Interestingly, even though the case company provides solutions for laboratories, labora-tory decision-makers, while deciding upon methods used in their laboralabora-tory, must con-sider their customers’ needs, requirements, and abilities. Hence, laboratory

decision-makers often consult their decisions with hospital management and heads of relevant hospital units. As stated by a laboratory chief physician:

“We [laboratory] make investment decisions ourselves. But of course, we have to consider what our customers need and how much they are willing to pay for in-vestigations. When we make investments into new investigation methods and if those imply changes in the screening protocol and the price of an investigation goes up or turnaround time changes, then we have to discuss with the hospital and other customers whether it is ok and if they are willing to pay this extra amount of money to get for example more comprehensive or faster results.”

The statement clearly shows that the case company has to convince the laboratory de-cision-makers that the solution brings efficiencies not only within the laboratory settings but also enables the laboratory to provide value to the hospital. Hence, the case com-pany must gain knowledge of the changes that take place in a laboratory while their solution is implemented. Moreover, as also stated by the company’s marketing manager, the case company must be able to provide the laboratory with a set of benefits the hos-pitals may gain so that laboratory representatives can easily understand and convey the value of the case company’s solution also to the hospital’s decision-makers. That, in turn, means that the case company has to understand the impact of its solution in hospital settings and how this impact is reflected in terms of customer value a screening result might provide to the hospital and other relevant stakeholders. Based on these state-ments, it is clear that there are certain dependencies between various stakeholders that make the sales process of the case company’s solution challenging. Figure 41 shows these dependencies between different stakeholders.

Dependencies between stakeholders and the case company.

Figure 41 presents relations between stakeholders and which stakeholders are likely to interact with each other. The case company interacts mainly with the laboratory decision-makers with whom the case company’s representative negotiate the deals and close the sales. However, laboratories being suppliers of tests results to hospitals negotiate some purchase decisions with hospitals. In case the hospital owns the laboratory, the case company may also directly negotiate with the hospital management responsible for the laboratory operations. While laboratories are the case company’s main customers, they are also a source of information regarding current hospital needs, and labs also test many solutions available on the market. Thanks to laboratories, hospitals can make bet-ter-informed decisions and hence provide better quality care to patients.

Government and healthcare agencies affect hospitals and laboratories decisions as these organizations set standards that must be followed by hospitals and labs. Also, public hospitals and laboratories run on public money, hence investments in new solu-tions must also be justified to fit the public budget. Public funding also brings certain obstacles to the case company as bigger investments made by public organizations have to go through a tender process. Tender offers do not only have to fulfill special require-ments but also follow a designed schedule, which often means that the negotiations and sales process are lengthy and resource intensive.

Moreover, Figure 41 places the case company and all the stakeholders in the context of society as CRE indirectly also affects the society at large, at least health- and cost-wise.

While the societal impact and regulatory influence are here acknowledged, the case fo-cuses mainly on the impact of the case company’s solution on the laboratories and hos-pitals, and hence indirectly also on the patients.

Furthermore, as the case company provides innovative molecular solutions for screening of common infectious diseases and antimicrobial resistances, there are already many different solutions being used by laboratories to guide physicians in their decision mak-ing. However, according to Morel et al. (2016), in the field of infectious diseases, a par-ticular challenge to the adoption of more innovative solutions, like molecular diagnostics offered by the case company, is the well-established use of traditional diagnostic meth-ods such as culture and drug susceptibility testing. Many laboratories nowadays still use traditional methods to screen for antimicrobial resistances as those methods are rela-tively reliable and cheap. Nevertheless, traditional methods may require several days to produce results while the case company’s solution requires a bit over an hour to report results as Figure 42 illustrates.

Time-to-result: traditional versus case company’s solution.

Figure 42 presents that the laboratory using the case company’s solution can deliver screening results 22-74h earlier as compared to the use of traditional methods. This time difference in the hospital setting may bring potential changes in terms of a patient’s treat-ment process. Moreover, access to earlier results may affect not only treattreat-ment-related decision making but may impact the whole process of handling antimicrobial resistance in hospitals. These changes may, in turn, be reflected in potential cost savings for the hospitals. Nevertheless, the case company offering their solution cannot just say that their solution has the potential to bring savings. The case company must showcase how this time efficiency positively affects work in both laboratories and hospitals. What also makes the situation more challenging is that the use of traditional methods is less costly.

It is estimated that the cost of performing the test using a molecular solution might be a few times higher for laboratories as compared to traditional methods. It means that the laboratories that want to implement molecular solutions will have to increase the price per test for hospitals. Such a price increase has to be well justified. Thus, the case com-pany must be able to present how the time efficiency in obtaining results, brought by their solution, is translated into monetary terms. One of the representatives of the case com-pany said:

“Budgets in hospitals are tight, and if none can see direct savings, it is difficult, none likes to rearrange budgets. We need a way to convince the hospital man-agement that we bring positive change. What would be helpful for us is to be able to showcase how the change from chrome agar [traditional method] to our solution impacts hospitals in terms of cost-efficiency. Benefits anyway come on a patient-level - shorter length of stay, lower mortality, and, on macro-patient-level, less spread and correct use of antibiotics.”

Hence, to be able to showcase the potential cost-efficiencies, the case company needs to understand how their solution affects the work in laboratories and hospitals to note the main changes and analyze what these changes mean in terms of processes, practices, and resources currently utilized by hospitals and laboratories. However, there are differ-ences in the levels of antimicrobial resistance among different countries, and hence dif-ferent countries adopt difdif-ferent protocols for handling the CRE in their hospitals. This means that the impact of the case company’s solution may vary between various hospi-tal-settings and the case company needs to be able to address these differences while discussing the value of their offering with different laboratories and hospitals. Importantly, the case company also needs to recognize the customers for whom their offering will bring the greatest value.

Along this section, there are many challenges described that show that, despite the case company’s solution’s ability to provide physicians with results even up to 74 hours earlier, the deployment of this solution is not a straightforward process. These challenges can be summarized as follows:

1. Medical laboratories widely use traditional methods of screening for CRE and all the processes and practices built on these methods.

2. There is a complex network of actors whose needs have to be satisfied.

3. The approach to investments in healthcare is still rather cost-based than value-based and immediate cost reductions are strived for.

4. There are no unified procedures related to screening for CRE.

Despite these challenges, the case company needs to find a way how to efficiently and effectively discuss the value of their molecular screening device. Most of all, the company must be able to recognize what are the most important decision-making factors for its customers while not making complex analyses for each customer from scratch. There-fore, the case company needs a tool that would help to analyze the value of the com-pany’s offering using pre-defined modules, i.e., value categories and variables to be an-alyzed, which can be filled in with an individual customer data. Such a tool could then support the creation of customized value propositions together with the customer and serve as a platform to discuss potential new options for the customer’s actions, hence stimulating the customer’s value creation process.

The topic of antimicrobial resistance and laboratory screening methods are not common knowledge within the business and management fields. Thus, the next chapter will briefly review the meaning of carbapenem resistance and the importance of early recognition of patients with CRE, and also compare the traditional screening method to the method proposed by the case company. Moreover, discussion of these topics builds the ground for analysis of hospital and laboratory processes, practices, and resources that play a key role in the recognition and handling of a patient at-risk of carbapenem resistance.

That, in turn, allows recognizing main value categories and value elements to be further analyzed.