Market Cuts and One Goal Console

This blog assignment deals with market cuts and how they may pertain to my group project, The One Goal Console.

Demand
The impetus for this project/product was two fold. The first was to make nurses' and doctors' lives easier by aggregating real time medical data on patients. The second was to improve clinical outcomes for patients by reducing response time, errors, and anxiety. Conceivably, the demand for this product would be any medical care facility that needs to monitor vitals. This would include day surgery centers (outpatient/ambulatory surgery, extended care centers (hospice, nursing homes), and inpatient medical centers and emergency rooms (hospitals). The technology could help but would probably be less useful to clinics, urgent care facilities, Minute Clinics, pharmacies, case managers, and specialist offices (e.g. dermatologists).

Using a conservative estimate, this would probably give us one-third to about half of medical care providers in a perfect world. It could conceivably be more, but given the push by plan sponsors to early intervention through office visits and other lower cost health delivery settings like Minute Clinic and urgent care centers, I think my estimate is in tune with future developments in how care is provided in America.

Addressable Market:
The addressable market is going to be very close to the maximum demand, since there is no reason to believe that any one center or hospital is dramatically different than another. In other words, there is no reason to believe that once the product successfully gains a foothold in the ambulatory surgery center market that it can not spread out across the USA and reach all ambulatory surgery centers. The only subsets of the maximal demand that would probably be considered unaddressable are markets where Kaiser Permanente has a strong presence. The reason for this assessment is Kaiser's dedication to technology and innovation. They may wish to buy this product and become a customer, but the smart money is on them competing or already having their own similar product for their own facilities. This severely limits TOGC's ability to target the California, Georgia, Maryland, and D.C. markets, for example. Kaiser only has a significant presence in about 10 or so states, but it would have to be monitored as each state it "takes over" becomes a market that the TOGC may not be able to penetrate and win.

Realistically, as a start up, the most viable addressable market to get the product launched successfully would be outpatient surgery centers in the northeast region of the USA. This would allow our team to interact in person with prospects and customers while slowly growing our foothold in the healthcare industry.

Realistic Opportunities vs Competition:
To the best of my knowledge there is no serious player with this objective. That does not mean that we are immune to competition. The following would be the biggest threats as competitors:

1.  Kaiser Permanente - This medical system could conceivably grow into more states, which makes us getting a foothold an almost insurmountable challenge, in addition to growing oraganically, Kaiser's embracing of technology and clinical outcomes could lead to it building and marketing its own version of TOGC, which could also provide formidable competitive challenges as they would be a major name in the industry with a significant clout and bankroll.
2. Medical Device Manufacturers - Assuming TOGC begins to get adopted, what would prevent device makers, especially larger ones that cover a wide range of devices, from developing their own fully integrated device data solution? This seems more strongly tied to whether or not they would want to branch out of their core competency than anything we could do but this could be a downstream threat as device makers compete with each other rendering TOGC a casualty of war.

Given the two challenges above, I think the realistic outcome would be as follows:

1. Regarding Kasier - As I stated above it given the colossal challenge that would come with selling a solution like this to Kaiser coupled with their almost uncanny ability to create new technology themselves it just does not make sense to try to engage Kaiser directly in any of their markets. We may be able to co-exist peacefully in adjacent but non-overlapping markets, but until TOGC has the clout and the resources to try to compete any attempt to compete with Kaiser would be foolish. I would fully expect Kaiser to have their own proprietary analog to TOGC, however, as far as I know they do not typically sell their proprietary solutions to other medical systems so while they most likely would not attempt to muscle us out of any markets we enter I truly believe any market they have is theirs to keep. This is not all doom and gloom as resistance to HMO models exists in many states so it is not as if Kaiser could take all 50 states into their network.
2. Medical Device Manufacturers - While a big manufacturer could attempt sell complete solutions, I do not see them attempting to leave their core competency to compete on this axis with each other. This could perhaps lead to a small handful of competitors but not a huge market where each entrant has approximately no influence on the whole market. Where I see this type of competitor being a real headache is when TOGC tries to penetrate hospitals and hospital networks (e.g. Lifespan in RI). The big device manufacturers would have working relationships with hospitals and may be slightly faster at coming to market with a comprehensive device data solution as they would have all or almost all of the necessary devices in house for R&D purposes. Considering we would be growing up from the ambulatory and hospice segments of the healthcare market prior to attempting to enter hospitals we may end up becoming the "gold standard" for these facilities but also end up being the "proof of concept" that helps huge established device manufacturers beat us into getting entrenched in the hospital market. However, hospitals are a long long term goal and emergent competition hinges upon these companies taking a step out of their comfort zone, which can be very difficult for large companies.

Winnable Market Segments
As stated above, the most "winnable" market segment is probably the ambulatory or outpatient surgical centers. These facilities have many of the same concerns that inpatient facilities face but tend to deal with, on average, far less intensive cases with far fewer devices. This market allows us to reduce the number of devices we would have to consider for compatibility issues while also being able to penetrate a growing medical care delivery market. As inpatient care continues to become more expensive and as more and more surgeries become outpatient the number of outpatient surgical centers in the USA is only going to rise. By targeting these less complex but integral settings we establish a customer base that will grow as we grow.

The smaller size of these operations also dramatically shortens the sales cycle which would allow us to get established more quickly as the longer sales pitches to hospitals and hospital systems could only create more opportunities for deals to fall through.

In terms of geography, since the team is based in the northeast region of the USA, the ideal winnable target market would thus be outpatient surgery facilities in MA, CT, RI, VT, ME, NY, NJ, and NH, with a special emphasis on MA due to its population density and ease of access for our team.