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VHA: connecting its members
and delivering results
VHA supports a hefty group of hospitals and other
acute-care operations; it promotes inclusion of WWT
and other M/WBEs in national or regional contracts
 Lamont Robinson is excited. “Here at VHA I have a chance to create something innovative and brand new. You’ve got to have passion for this job!”
Robinson left Cardinal Health just over a year ago to take up the newly created position of director of business development and supplier diversity at VHA, Inc (Irving, TX), the national healthcare alliance.
VHA was founded in 1977 as the Voluntary Hospitals of America. Over the years it evolved into VHA, a nationwide network of healthcare-delivery organizations.
“Connecting members; delivering results” is VHA’s watchword. “We support 1,400 not-for-profit community-based hospitals as well as 21,000 acute-care operations like clinics, nursing homes and some doctors’ offices,” Robinson explains. VHA members purchase products and services through contracted VHA agreements for anything from temporary labor to IT consulting services, HR and clinical services, capital asset services, management services and temporary staffing.
Besides its Irving, TX, headquarters, VHA has sixteen regional offices across the country. “We have both a national presence and a regional focus,” Robinson notes with pride.
Novation for group purchasing
“Our hospitals and other operations use products like masks and gloves in large quantities,” says Robinson. “For supplies of that nature we created Novation (Irving, TX), a group-purchasing organization specializing in physical products and supplies, in 1998.”
Novation has grown into a leading healthcare contracting company. VHA owns 77 percent of Novation, and University HealthSystem Consortium (UHC, Oak Brook, IL), which supports teaching hospitals and medical centers, owns the other 23 percent.
Service contracts
VHA has a master service contract its members can tap into, but it doesn’t do the actual purchasing for them. “We negotiate contracts on behalf of our members, who pay us membership fees,” says Robinson. “Of course we need to bring value to the table for them in these contracts or we wouldn’t be able to retain them as members.”
And retain they do. “We have many healthcare leaders among our members: Cedars Sinai in California, Providence Health and Services in the Pacific Northwest, Mayo Clinic in Minnesota, Integris Health in Oklahoma and others. Obviously, we have to continue to provide value-added services, and supplier diversity is a strategic part of that.”
Diverse suppliers
“The challenge with supplier diversity in healthcare is the lack of diverse suppliers that actually manufacture products and supplies,” Robinson explains. “Diverse suppliers sometimes lack the economies of scale they need to enter these markets. FDA regulations can be a challenge. So, late in 2007, we created a program to actively seek out diverse suppliers that can grow to support either a national or a regional opportunity.”
VHA’s direct contribution is in the service contract area, of course, but “if Novation is working with one of our members, I am included in the process to represent the alliance. We are involved whether it’s services or products.” Novation has had a supplier diversity program since 1999, Robinson notes.
Diversity in the contracts
VHA’s sixteen regional offices help support supplier diversity with regional contracts. “Many diverse suppliers are not geared to compete on the national level, but are very competitive regionally,” Robinson reflects.
“Part of my challenge is finding the strong, regionally-based diverse suppliers that might be able to compete nationally, or could partner with one of our national suppliers as a second-tier.
“We view tier 2 as a strategic way of growing our diverse supplier base because it makes sure our national suppliers have a commitment to supplier diversity,” Robinson adds. “And it ensures that the diverse suppliers get opportunities.”
After all, he notes, “Healthcare is an industry that’s growing 8 percent a year. President
Obama has made it clear that he wants more technology invested in healthcare. Given his focus on small businesses, we expect to see a greater emphasis on supplier diversity in the next several years.”
Certifications
VHA uses NMSDC and its local affiliate, the Dallas Fort Worth Minority Business Council, and WBENC’s local affiliate, the Women’s Business Council Southwest, to find diverse suppliers.
“It gives us more comfort to know they’ve gone through the screening process,” Robinson says with a smile.
In fact, when VHA recently considered a national contract with a likely WBE who was not certified, “We helped her connect with her local WBENC affiliate. After she’s gone through the certifying process we’ll have a new national WBE to offer our members.”
Regional councils in the works
Robinson is working on developing VHA’s own regional councils, loosely mirroring the NMSDC and WBENC models. “Eventually, each of our sixteen regions will have its own specific VHA council,” he says. “Each council will have a collection of VHA members from that particular region as well as one of our own regional employees.” Council members will have an interest
in supplier diversity and will hopefully develop or continue to enhance their own supplier diversity programs.
The councils, he hopes, “will give me a great platform from which to promote the diverse suppliers we currently have on board, and solicit feedback on diverse suppliers our members already use. This will be a great way for us to introduce new M/WBEs to our supply chain.”
A preliminary meeting has already taken place via a Web-based seminar conducted by VHA’s central region. This year Robinson and his people expect to work on the program with at least six regional offices.
The Novation approach
Another approach is through Novation’s Supplier Diversity Advisory Group, which includes members from both VHA and UHC. “We get together quarterly,” Robinson says. “When large members are on board, their success helps influence the smaller members to adopt a diversity program.
“At our annual leadership conference this year, presentations from Mayo and Spectrum Health will show other members how to create a supplier diversity program or enhance what they already have.”
Robinson also intends to initiate two awards: for diverse supplier of the year and for member of the year. “That will boost the competitive spirit and hopefully increase the number of members who have active supplier diversity programs.”
Connecting with WWT
World Wide Technology (WWT, St. Louis, MO, www.wwt.com) is a leading systems integrator and
major MBE supplier to members of the VHA alliance.
“Our contract with them is for IT solutions: networking, storage, servers, PCs, peripherals and Quicken,”
Robinson reports. “Of course we also look at the many other services they offer.”
WWT, a value-added reseller for Cisco, Sun, HP, EMC, Dell and other brands, is probably the largest African American-owned business in the U.S. “It was one of the first to grow organically from zero to a billion dollars in annual revenue,” says Dave Steward, its president and CEO. Currently revenue is approaching $3 billion, he adds.
VHA’s relationship with WWT started in 2006. “In the beginning it was slow because this was WWT’s first foray into healthcare at this level,” Robinson says.
“We knew about them”
Even before the relationship began, “We knew about VHA,” Steward says. “They are pretty aggressive about looking for and working with diverse companies. We also knew about them through the great work they’re doing in the healthcare field here in St. Louis.
“We wanted to expand our healthcare business and showcase our value-added technology, and we knew the healthcare industry needed better access to technology. It was kind of a match made in heaven,” Steward reflects.
WWT has been doing business with the U.S. Department of Defense Military Health System, the Department of Health and Human Services and the Veterans Administration for a number of years, but VHA is one of the first commercial healthcare organizations the MBE has been involved with.
“The best of the best”
“Our NMSDC certification was very helpful,” Steward says, “and our endorsement by NMSDC’s Corporate Plus program is the best of the best! Those credentials on our resume certainly helped facilitate VHA’s interest. We have certifications or reciprocal certifications with NMSDC affiliates in just about every state, and all of that showed that we could handle the size and scale of the opportunity.
“Since we made the connection we’ve expanded into different parts of the network, like Mayo Clinic, Ohio Health, Baylor Healthcare and Memorial Herman in Texas and BJC HealthCare in our own backyard. It’s been tremendous in scope! We would not have had that access and credibility if we had not secured the contract.”
Working together
“Education is going on between our two organizations all the time,” Steward discloses. “I
spoke before 3,000 members at the VHA leadership conference last year. I showcased WWT
to that audience: our capabilities and the scale and size of technology we are able to supply
for the future.”
WWT has an active supplier diversity program of its own. “We put a lot of effort into that,” Steward says. “Many people sacrificed so that we could benefit from affirmative action and this is an opportunity for us to give forward.
“We are always looking to guide and support companies that are the emerging WWTs of the world. We get great pleasure and delight out of coaching and advising.”
In peak years, Steward notes, “We probably do $15 to $20 million with our own diverse suppliers.”
Improving the quality of life
“I am so blessed to be in this position,” Steward reflects. “We are very active in the community. We think that improving the quality of life in the community where we live and work is extremely important as a resource for the future of the business.”
Steward chairs St. Louis’ United Way campaign in WWT’s HQ city. “In 2008 we raised $69 million. I am the first person of color to chair the UW here and I’ve done it for the last three years, through Katrina and Rita and the mudslides and the tsunamis.
“We put a lot of our time into investing in the community and diversity and things that we care passionately about. It’s the real joy of giving back.”
The greatest time
“This can be the greatest time in the history of this country for diverse entrepreneurs,” Steward believes. “Who can be more creative, more innovative, more nimble and flexible at thinking outside the box, than diverse companies that have had to do it!
“You have to think differently than you have before, bring more value than you have before, and you have to be able to turn on a dime. The big companies are going to be much more open to the value you bring, because they have to drive down cost and raise efficiency. And
a diverse supplier, who has had to be flexible and innovative just to survive, can help them
do that.”
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