The Competitive Edge
Attention AIM North America Members and Customers
The Competitive Edge is the new monthly, quick-read e-newsletter of AIM North America. As the title suggests, our purpose is to provide you access to information that will help you maintain your competitive edge and grow your business. This communiqué will highlight current reseller, integrator, and distributor issues and market trends—a feature titled Headline AIM —along with member-specific news and information. Comments and suggestions are welcome. Please forward them to info@aim-na.org or call +1 724 934 5688.
Just another way AIM NA is working for YOU!
Season Greetings from AIM North America
May this season be the start of a new year filled with prosperity and peace.
Our offices will be closed December 22, 2006 – January 1, 2007
AIM NA Now Located in Warrendale, PA
With the hire of a new executive also comes change. The AIM NA office is now located within AIM Global headquarters. Our e-mail and web address remain the same. Please make note of the following address, phone, and fax changes:
AIM North America
125 Warrendale-Bayne Road ,
Suite 100
Warrendale , PA 15086
Phone: +1 724 934 5688
Fax: +1 724 934 4495
Headline AIM—Healthcare: A Market for Specialists
By John Burnell, Principal, Burnell Reports
It’s been more than four years since former U.S. Secretary of Health and Human Services Tommy Thompson famously said in a speech “Some grocery stores have better technology than our hospitals and clinics,” and nearly 10 years since the Institute of Medicine released its landmark “To Error is Human: Building a Safer Health System” report that claimed preventable medical errors kill up to 98,000 Americans each year. Yet it is still very difficult for Automatic Identification and Mobility resellers to sell into hospitals, even though the technology is well proven to prevent errors and save lives.
The penetration rate for bar code medication administration is estimated between 10 and 15 percent, and there is similarly low adoption for many other patient safety applications. Healthcare has long been considered a high-potential market, and recent requirements by the FDA and the Joint Commission for the Accreditation of Healthcare Organizations (JCAHO) have spurred interest and adoption of bar code and RFID systems for medication administration, wristbanding, specimen collection and a variety of patient safety and materials management operations. It will still be difficult for VARs to take advantage of the next wave of adoption.
“If you’re an experienced healthcare reseller, it’s not very hard at all to sell into the market right now,” says Dave Stewart, president of AMTSystems (www.amtsystems.com), which 
has focused on healthcare for many years. “But it may be harder to get established than ever before. You run up against all the big healthcare information systems (HIS) providers like Meditech, Cerner, McKesson and others, who provide the complete solution. If you’re not affiliated with one of those companies, you’re going to find it very hard to make any headway.”
“The large medical centers and health systems are served by the large HIS providers and independent software vendors (ISV),” says Howard Finch, director of channel development at Hand Held Products (www.handheld.com). “VARs need to focus on tier two facilities, like regional and community hospitals. The first thing VARs look at is hospitals, but there are other large segments, such as extended care facilities or emergency care centers, that have a lot of the same needs but don’t require the same large infrastructure investment that a 200-bed hospital would have.”
Long sales cycles and proprietary IT infrastructures are two of the biggest barriers to VARs succeeding in the healthcare market. Many hospitals don’t have wireless LANs, electronic medical records (EMR) and other infrastructure building blocks needed to support bar code applications. By the time these systems are implemented, there’s little if any budget left, and spending priorities may shift back to medical equipment.
“In just the last three years there has been a huge change in bar code awareness among medical professionals,” says Debbie Murphy, global practice leader for life sciences at Zebra Technologies (www.zebra.com). “We are getting very detailed questions now, when before for many people you had to explain what you could do with a bar code. But legacy IT systems are still a huge barrier to adoption for hospitals, and most VARs simply can’t afford to invest the time that the sales cycles require.”
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One of the reasons awareness is up is the FDA's requirement that all medications intended to be dispensed in hospitals be marked with a bar code at the unit-of-use level by April, 2007. The rule mandates pharmaceutical providers to mark drugs with bar codes – but makes no requirement for hospitals to read them. Thus the rule will not be the same catalyst for adoption as compliance requirements in other industries.
Other bar code applications may represent better short-term sales opportunities. These include pharmacy labeling, specimen identification, wristbanding, plus a host of applications not related to patient care, such as traditional and RFID-based asset and materials management.
“Fixed asset tracking is a very big market, and it's probably an easier push for a VAR,” says Stewart. “Those systems are purchased by different channels within a healthcare facility, and VARs probably also have more of an opportunity to establish relationships with the technology providers.”
VARs can also be successful providing traditional patient safety and patient care systems, but everyone interviewed said success requires a significant investment of time and dedication to the healthcare market.
“We believe healthcare is one of the largest growth opportunities, but it is not a market where traditional VARs can jump in and use the knowledge they already have to be successful,” says Hand Held Products Director of Healthcare Dave Stewart (no relation to Stewart of AMTSystems).
“Because there is such a low level of penetration, it is certain the market will change,” says Murphy. “VARs really need a high-level understanding of what’s happening in healthcare and what’s driving change, and they have to invest a lot of time to stay on top if it.” |
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Healthcare Resources
To serve the healthcare market it is essential to know what drives and requires technology implementations. The following resources provide background on some of the most important regulations and issues in the industry.
For complete details about the FDA unit-of-use bar code marking requirement, visit here .
Review the Joint Commission on Accreditation of Healthcare Organizations (JCAHO) National Patient Safety Goals for patient identification, medication administration and specimen labeling at www.jcaho.org .
The American Society of Health-Systems Pharmacists (ASHP) has a policy statement on machine-readable coding technology. Learn more about the organization and all its patient safety efforts at www.ashp.org . The organization's Pharmacy 2015 Initiative challenges hospitals to automatically verify 75 percent of medications administered by 2015.
The Healthcare Distribution Management Association is very active in RFID initiatives for e-pedigrees, item tracking, anti-counterfeiting and other security applications. Its Web site, www.healthcaredistribution.org , has information about the recent RFID Health Care Industry Adoption Summit and other resources.
The Healthcare Information and Management Systems Society (HIMSS, www.himss.org ) is a good source for information about bar code, RFID and other IT issues in the industry. |
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John Burnell has been covering the automatic identification and mobility industry for more than 16 years. He is the principal of Burnell Reports (www.burnellreports.com) a communications and consulting firm serving the industry. Contact him at john@burnell.com or 216.571.2319.
Industry Events
January 29 – 31 Total Asset Visibility Arlington , VA
February 13 – 15 WESTPACK Anaheim , CA
February 21 – 22 Asset Management Conference San Diego , CA
February 25 – 27 AIM Channel Forum at the AIM Showcase Tampa FL
April 30 – May 2 RFID Journal Live Orlando , FL
AIM NA Welcomes
Cut-Rate Battery
Join Date: 9/1/2006
CutRateBatteries.com is the fastest growing manufacturer and distributor of battery technology products. We manufacture the highest quality replacement batteries and accessories for a complete range of barcode scanners and printers.
Trace Automation
Join Date:12/1/2006
Trace Automation works with its customers to replace paper-based batch processes with real-time, automated identification and data collection systems based on mobile computing, barcoding and RFID.
Members in the News
Stratix Corporation Goes “Above and Beyond” Learn how Stratix’s “. . customer centric approach quenched a Coca Cola Bottling Company’s enterprise mobility needs” (Source: VSR, Nov. 2006, pg. 17). Read more in the November issue of Vertical Systems Reseller magazine.
AMTSystems Gives Campus Police a Ticket to Ride See how a campus police unit saves time and money with AMTSystem’s mobile ticketing solution. Read more in the November issue of Vertical Systems Reseller magazine.
If you’re a member company and have been highlighted in an industry publication or have a case study you would like to share, submit your items to info@aim-na.org.
The AIM NA Advantage
AIM North America Announces Educational Opportunity for VARs, Integrators, and Distributors—The Channel Forum kicks off the AIM Showcase on Monday, February 26, 2007 by featuring the most up-to-date channel education program for resellers, integrators, and distributors of bar code, RFID, POS, and mobile computing technology solutions. For complete details visit the showcase
website.
Have a Night on Us—If you are looking for another good reason to attend the upcoming AIM Showcase and Channel Forum look no further. Participants who register in the month of December will be entered into a drawing to win a free one-night hotel stay. For complete details, click here . This offer expires December 31, 2006.
Not a member? For the cost of a mere cup of coffee per day, your company can take advantage of these and other leading-edge benefits geared to keeping you on the forefront of the AIM industry. Learn more on the AIM NA website.
THE FINE PRINT
This e-newsletter is brought to you by the
AIM North America
125 Warrendale-Bayne Road, Suite 100, Warrendale, PA 15086 USA
Phone: +1 724 934 5688 | http://www.aim-na.org
If you do not want to receive The Competitive Edge by e-mail,
please e-mail info@aim-na.org .
