United we stand? (Musings on competition for blood donors)

This blog examines a recent news item on the effects of a poor economy and increased competition for donors among blood suppliers in the USA and muses on economic basics, as applied to blood suppliers. The blog ends with a silly skit suggesting what competition for donors might look like in Canada, where Héma-Québec reigns supreme in La Belle Province and CBS has a monopoly in the Rest of Canada. The title derives from an old hit song by the British pop group, Brotherhood of Man.

BLOG'S GENESIS
Unlike fractionated blood products, where commercial drug companies "duke it out" across the globe, competition in providing blood and blood components is something foreign to Canada and many other countries. Hence, this item from the USA recently caught my eye:

• Erie Community Blood Bank battles economy and competition

Apparently, in Pennsylvania competition for donors has become fierce: the Pittsburgh-based Central Blood Bank (a division of the Institute for Transfusion Medicine) has increased the number of blood drives in Erie County, although it doesn't supply blood to hospitals there.

"The turf battle came to a head July 1 when Community Blood Bank held an impromptu blood drive outside the Sheraton Erie Bayfront Hotel, while the Central Blood Bank was holding an indoor one. Employees from each blood bank exchanged heated words, but the two organizations haven't talked since then...."

A Community Blood Bank spokesperson is reported as saying,

• "It's a shame. We used to work together on projects. Not anymore."
• The Central Blood Bank declined to return the reporter's phone calls requesting comment.

So, competition for blood donors seems to have taken a nasty turn in the USA. The news item goes on to report that, with the current struggling US economy, the Community Blood Bank will lose money in 2009-10. It has not laid off employees but has increased its blood prices.
Pointedly, Community Blood Bank's website specifies that it "only draws from the areas in which it supplies."Writing a blog on the blood system as a business in which blood suppliers compete was further promoted when the latest Journal of Blood Services Management issue came out, prefaced by a letter explaining that it cannot meet its planned quarterly schedule. In reviewing the types of articles wanted, competition was listed as a suitable topic. For more on JBSM, see last July's blog, "Transfusion lite" - Back in the USSR?

For interest, you can now read the first JBSM issue free online.
ECONOMICS PRIMER
What follows is a simplistic take on complex economic issues. I'm totally unqualified on the subject, being a mere, somewhat cynical observer of private sector machinations to generate profits. But, hey, why let ignorance stop one from voicing opinions.
Canadian Blood Services (CBS) and America's Blood Centers (Héma-Québec, but not CBS, belongs) are non-profit organizations (NPOs). By definition, NPOs use profits, if there are any, to pursue goals, rather than distributing them to owners or shareholders.
To survive, NPOs and other businesses must be profitable in most years or at least break even. That means that revenues must exceed expenses. Successful companies increase revenues or decrease expenses or do both.

DECREASE EXPENSES
Decreasing expenses involves strategies such as
1. Decreasing overall staff (a significant cost) via automation, centralization, regionalization, e.g., CBS's move to only 3 blood testing centres for all of Canada and one National Contact Centre for booking donor appointments

2. Decreasing staffing costs, achieved by hiring less qualified staff who can be paid less, e.g., CBS's move to use "donor care associates" in donor screening (as opposed to RNs)
3. Hiring more part-time and casual staff whose health care, pension, and other benefits do not need to be contributed to by the employer (statistics are hard to obtain and are not usually publicly accessible)
4. Forming consortia (or merging with others) to facilitate volume purchases by the group, e.g., Group Services for America's Blood Centers
INCREASE REVENUES
Companies can increase revenues via increased sales volume or increased prices. In Canada (and other countries with mainly government-funded national blood suppliers), increasing revenues is not an option except by negotiating with relevant governments and who knows what goes on in those dark and dirty meetings, certainly not I.
In general, strategies used by companies to increase revenues may include the following. Some of these may apply to US blood suppliers.

• Create a demand for products, if none exists, or an increase demand (e.g., commercial umbilical cord blood banks such as Alpha Cord and Pacific Cord .The latter offers 'concierge service'!)

Get ahead of the curve by moving into emerging, 'latest/greatest' in-demand products, and charging more for them (so called value-based pricing) e.g.,human cells, tissues, and cellular- and tissue-based products

Produce a better product than competitors, preferably at a competitive price, or argue for your product's value-added benefits (e.g., leukoreduced red cells, double red cell collections, improved customer service)

Increase distribution area so that the number of potential clients increases (rapid, reliable long distance transportation)

Increase clients with loss leaders ("Like our cheap RBC? Now have we got a deal for you...."), and later promote products with high profit margins (e.g., inexpensive or free instrumentation with costly, ongoing reagents)

Entice more clients with a positive corporate image, e.g., promote impressions of quality products and services via public relations campaigns and community involvement

Develop an effective and easily recognizable brand identity for the organization, e.g., CBS's logo and tag line, It's in you to give

From the website: "Canadian Blood Services has updated all key brand positioning elements and personality traits. The result is a focus on positioning Canadian Blood Services as the trusted place where Canadians can share their health and vitality to help others regain theirs."

SILLY SUMMER SKIT
Since it's summer, and the city where I reside had its "silly summer parade" on Canada Day (July1), here's a skit that I hope makes you laugh. It's totally tongue in cheek and written with affection for the characters involved. My apologies to all concerned for taking such liberties.
Just as the Pittsburgh's Central Blood Bank made an apparent raid into the territory of the Community Blood Bank, I could not help but wonder, WHAT IF Héma-Québec made a similar raid from Hull, Quebec across the river into Ottawa, Ontario, the site of CBS's head office? (Rough translation follows the skit.)
START OF SILLY SKIT

• Graham (shocked): "Francine, quelle surprise! Mais, que fais-tu ici?
• Francine (playful): "Bonjour, Graham. Ça Va?"
• ===================================
• Graham (puzzled but now more formal): "Mais, pourquoi, Francine? Vous êtes sur 'my turf'!"
• Francine (smiling): "Oui, mais nous sommes toutes les canadiennes, n'est-ce pas?"
• ===================================
• Graham (ashen-faced): "Merde, Francine! J'accuse! N'avez vous aucune pitié?"
• Francine (chuckling with a wicked gleam in her eyes): "Graham, c'est un signe des temps. Vive le Héma-Québec! ...(long pause...) Vive le Héma-Québec libre!"
• ===================================
• Graham (sweating profusely): Mindy, aidez-moi, s'il vous plait! Notre amie, elle est....'bonkers'! Il doit être son expérience avec ces Européens fou au ISBT!"
• Mindy (ruefully shaking her head and with a mischievous glint in her eyes): "Désolé, mais vous êtes vous-même, mon ami! Voulez-vous le numéro de téléphone de Heather?"

SILLY SKIT (ROUGH TRANSLATION)

• Graham (shocked): "Francine, what a surprise! But what are you doing here?
• Francine (playful): "Good day, Graham. How goes it?"
• ===================================
• Graham (puzzled): "But why, Francine? You are on my turf!"
• Francine (smiling): "Yes, but we are all Canadians, no?"
• ===================================
• Graham (ashen-faced): "Sh_t, Francine! I accuse! Have you no pity?"
• Francine (chuckling with a wicked gleam in her eyes): "Graham, it's a sign of the times. Long live Héma-Québec! ...(long pause...) Long live a free Héma-Québec!" (see historical relevance in Canada)
• ===================================
• Graham (sweating profusely): "Mindy, please help me! Our friend, she is....bonkers! It must be her experience with those crazy Europeans at ISBT!"
• Mindy (casually shaking her head and with a mischievous glint in her eyes): "Sorry, but you are on your own, my friend. Do you want Heather's phone number?"

.............END OF SILLY SKIT.........
Doesn't a donor competition scenario, in Canada or anywhere, seem nuts? Everyone knows the maxim, united we stand, divided we fall, but is a Pennsylvania blood center ignoring it? Here's a sugar-sweet song version of the axiom:

• United we stand (Gotta love the 70's outfits)

MORE FUN
Another scenario comes to mind. WHAT IF the Brits made a raid across the Atlantic to poach American blood donors. As you ponder, consider lyrics for an updated version of this catchy Johnny Horton mega-hit, The Battle of New Orleans (funky version from Ed Sullivan show)
For a serious glimpse into CBS's view of its business management strategies:

1. The transformation of CBS. Strategy management to create results .....[Source: Sophie de Villers, Balanced Scorecard Forum in Dubai, UAE , March 2010]
2. Embedding a results-based management culture / Moving modern management forward (Speaking notes) ....[Source: Ian Mumford, Performance and Planning Exchange Conference, May 2003]

As always, the views are mine alone. Comments are most welcome BUT, due to excessive spam, please e-mail me personally or use the address in the newsletter notice. 

"Transfusion lite" - Back in the USSR?

This blog is a provacative sendup of a new journal affiliated with the AABB.

In the July issue of Transfusion AABB announced a new journal, The Journal of Blood Services Management, in an editorial by Paul M. Ness and Philip D. Schiff: "The Journal of Blood Services Management, a new administrative focus for TRANSFUSION":

The JBSM will include a broad spectrum of organization and management issues facing blood service managers. Topics will include financial management, supply chain management, LEAN/6 Sigma, regulatory matters, manufacturing management, donor recruitment, public relations and communications, information technology management, hospital and customer relations, governance matters, international issues, services within hospital-based blood services, tissue program management, risk management, competition, leadership, and general medical and technical service management.

I have not read the first issue because it is not available on the web and I have not yet received my paper copy of Transfusion. It's always late for some reason, maybe due to residing in Canada?
The new journal (JBSM - sorry, I could not resist the emphasis) is a collaboration between AABB and Group Services for America’s Blood Centers (GSABC).
The GSABC mission statement:

• "To create a stakeholder-driven group purchasing enterprise that more effectively serves the members of America's Blood Centers"

From JBSM overview (on the GSABC website)

• The Journal of Blood Services Management will be the premier journal for thoughtful leaders in blood center and transfusion service management.

Articles will generally fall into two broad categories:

1. Those grounded in theory and/or papers using scientific research methods....
2. Those focusing on innovative blood service management approaches that are based on well reasoned-extensions of existing research, experiential knowledge, or exemplary cases (e.g., thought pieces, case studies, top executive interviews).

The journal wants articles that are "engaging, lively, challenging, and stimulating." I particularly liked this tidbit:

We recognize that many potential authors may be intimidated at the thought of writing for a peer reviewed Journal. We wish to reassure these authors that the editorial staff is willing to assist in any way possible to help you write a paper for submission. For those who have never written a paper for peer review, you may wish to think of it as nothing more than writing a “term paper”.

"Nothing more than writing a term paper" is an interesting choice of words, given that the journal is targetted to "thoughtful leaders."
I am confident that most AABB members, including me, will thoroughly enjoy JBSM:

• I like thought pieces and approaches that use experiential knowledge, which are more or less the equivalent of blogs like this one. No need to use scientific research methods and worry about solid evidence.
• Papers will be more practically oriented, hence more relevant to those who work in the TM trenches beyond the research milieu of academia. Many Transfusion papers remain unread for various reasons, including content that is perceived, rightly or wrongly, as irrelevant to practice and content that is beyond the reader's knowledge base.

CONCERN
Despite being keen about a new transfusion journal with promising content, I cannot help but wonder if the appearance of JBSM is yet another baby step on the long journey to making financial concerns and cost efficiencies paramount in transfusion medicine.
Transfusion medicine as a business is also featured in the June 2009 issue of AABB News, which includes a report on an NFB Leadership Forum held in April in Florida:

• NBF leadership forum focuses on innovating for the future

According to the report, attendees at this private meeting discussed issues that would be at home on the programs and in the board rooms of any business or industry. Speakers included industry leaders from

• Ortho-Clinical Diagnostics
• GE Healthcare
• Haemonetics
• Fenwal
• Bay City Capital (venture capitalists)
• ITxM
• Florida Blood Services
• Puget Sound Blood Center
• AABB
• ARC

Advice included recommendations to

• Examine the potential for partnerships, mergers, and outsourcing
• Implement lean strategies to decrease waste
• Focus on productivity indicators
• Diversify income
• Centralize compatibility testing
• Compete against other health sectors for investment capital
• Develop technologies that reduce labor and reagent costs

Recommendations more clearly TM-related with direct clinical implications were to develop blood utilization programs and transfusion guidelines.
Oh, yes, "and we must remember the donors and patients because that is who we are trying to serve." (Jim AuBuchon, President and CEO of PSBC)
As has been noted in earlier blogs, as the economy has worsened, papers that promote cost analysis as a primary driver of TM policies such as donor testing have become more common. Patient safety always enters such cost-focused papers and presentations but almost always as an after-thought or a robotic mantra unrelated to the actual take-home messages.
QUARTERLY PRAVDA? (Pravda definition)JBSM's scope fits rather nicely with the ideas expressed at the NBF leadership forum. It could serve as a propaganda arm of the GSABC, AABB, and NFB. Thought pieces and interviews on financial management, LEAN, and competition could easily promote ideas currently favoured by 'captains of industry'.

Ah, but what about peer review, you say. Well, peer review of traditional scientific papers has been criticized for years:

• How the Internet is changing journals (New Atlantis, Summer 2006)

Particulary troubling is the long trail of evidence that demonstrates that peer reviewers are often biased toward papers that affirm their own convictions.
Where does this leave peer review of non-research based papers such as thought pieces and interviews of TM bigwigs?
As a political analogy (try to jettison your own biases on this topic), think of former US VP Dick Cheney holding forth on his favorite theories and world view:

• Who among George W. Bush's cabinet, aides and other 'true believers' is going to be the bearer of bad news that the VP's views do not stand the test of evidence?
• There is Colin Powell, but we know what happened to him.

SUMMARY
JBSM promises to be an interesting addition to the transfusion literature. I could have joined the crowd and praised its appearance instead of giving it this tongue-in-cheek critique and calling it Transfusion lite and raising the possibilty of its use as a propaganda tool. But that would not have been thought-provoking or challenging, virtues praised in the new journal's overview.
FOR FUN

• Paul singing "Back in the USSR" (Red Square, 2003), only possible after the fall of the USSR
• CD has wonderful scenes of joyous Russians reacting to the once fobidden music

Comments are most welcome BUT, due to excessive spam,  please e-mail me personally or use the address in the newsletter notice. Participate in peer review....

Addendum to last month's blog: "Plus ca change, plus c'est la meme chose (Where are the Hearts of Gold?)" (Musings on why publishers charge for celebrating the dead)

• Based on a comment by Bev, here is an example of several obituaries of TM luminaries available in the ARC journal Immunohematology 2005; 21(4): John Maxwell Bowman; Sir John V. Davies;Tibor J.Greenwalt; J.J.Van Loghem