Full Plate

Edition: October 2004 - Vol 12 Number 10
Article#: 1950
Author: Russ Lane

The sales bug bit Miles Theeman early.

Growing up in a small town off the coast of Maine, Theeman spent most of his early years in a small clothing mercantile store learning the art of the sale. The lure of it stayed with him through school – MBA-level schooling crossing the country, no less – and back to Maine. Today, he is in his 28th year with Eastern Maine Healthcare System (EMHS), a regional healthcare system serving central, northern and southern Maine. He serves as executive vice president and COO for Affiliated Healthcare Systems, a $74 million for-profit subsidiary of EMHS and provider of a variety of services, including medical products distribution.

In many ways, Theeman is the quintessential salesman. He thrives on meeting people, excels at schmoozing and displays the healthy arrogance required of any independent dealer. “I have this huge character flaw,” he says. “I’ve never figured out why anybody wouldn’t want to buy something I have to sell.”

Is it any wonder Affiliated Healthcare Systems reflects the same confidence?

One Finger, Many Pies

Affiliated Healthcare Systems was established in 1982 to become not only one of New England’s leading independents, but also the region’s largest healthcare support system.

Medical distribution aside, the company provides reference lab services, drug testing, clinical counseling services, debt collection (both hospital-based and commercial), medical record transcription, ambulances for both critical care and inter-facility transport, three retail pharmacies, and a program that allows disadvantaged residents to buy prescription drugs from Canada, where drugs costs are much lower. Last year, the company closed its staffing division and transferred co-ownership of a Lifeflight helicopter company to another business under Eastern Maine Healthcare’s umbrella. In its place, AHS purchased a courier/small package delivery business it had used regularly.

Affiliated’s 600 employees provide services to its parent company’s hospital system and non-EMHS hospitals and alternate care practices throughout Maine, New Hampshire, Vermont, upstate New York and northeastern Massachusetts.

Multi-Tasking Sales Reps

Beyond the breadth of services AHS offers, and the depth of customer service that characterizes all of them, Theeman chalks up his company’s success to a simple sales philosophy: People not business logistics and complicated healthcare systems make decisions. Reach people on a personal level, and sales happen.

It’s up to Affiliated Healthcare Systems’ six sales reps to do much of the reaching. And they have their hands full, because each of them represents all of the company’s healthcare divisions not just medical products sales.

“Our reps…need to be acutely aware that the customer may not only be a [medical supply] client, but also a lab client, a collections client or a pharmaceutical client,” says Theeman. “A lot of times, that requires them to talk to four different people.”

The fact that Affiliated Healthcare Systems’ reps represent all its divisions is the company’s biggest strength, says Theeman. No competitor can assure a customer that he or she will have the same contact for seven or eight of its services.

On the other hand, the multi-tasking also poses the company’s biggest challenge. “Think about it,” he says. “They kind of report to each of the division heads, each of whom are constantly looking for leads and service qualification from those folks.”

Some of Affiliate’s divisions call for the sales reps to master highly detailed information, while other divisions require only basic knowledge. All divisions have a support staff to supplement the reps’ knowledge base should a customer need more information. Moreover, reps are trained in basic installation and repairs on equipment, often sidestepping the need for a separate repair staff or the need to wait for the manufacturer to make a repair.

Still, training reps to think about a menu of services and not merely medical supply sales, requires a careful balancing act. “Part of our job is to constantly provide opportunities for them to motivate themselves around the other lines, because I don’t want my collections division head walking in here and saying, ‘I didn’t get any new leads this month,’” says Theeman.

Cost vs. Value

With more healthcare providers surfing the Internet for better prices, independents have more with which to contend than just the local competitor rolling into the parking lot before them. The response by many independents, including Affiliated Healthcare Systems, is to emphasize customer service.

In addition to addressing conventional customer service concerns – such as keeping phone calls friendly, focusing on creative problem-solving and assuring punctual deliveries Affiliated aims to save its clients money, and make sure customers know it, says Theeman.

“There’s always someone else who can sell [products] more cheaply on an invoice basis,” says Theeman. “We emphasize the idea of ‘total delivered cost.’ Were we friendly on the phone? Were we price competitive? Did we deliver the order when we said we would? Did we follow up? If there was a problem, did we take care of it? Were we a resource for the customer as opposed to being the guy selling them the [product], and then turning our back and going to the next customer?”

While the approach doesn’t guarantee a sale, Theeman says it generally pays off. One of his favorite examples involves a rep who walked into his office, worried about losing an EKG machine sale because the doctor found a Florida distributor willing to sell it for $200 less. The rep couldn’t compete with that margin.

Theeman called up the doctor to instruct him not to call Affiliated Healthcare Systems for help installing the machine. Rather, if the customer needed instruction or a repair, he should call the Florida company and be prepared to wait, or possibly pay an additional fee far more than the $200 that the customer was trying to save.

Theeman laughs when he reaches the punchline: “There’s a real long pause on the phone and [the doctor] said, ‘Have Scott send it to me.’” The doctor never mentioned the Florida distributor again.

Heading Upward, Downward

While carefully servicing Eastern Maine Healthcare’s hospital system, Affiliated Healthcare Systems is looking to expand. Considering its location, “expansion” really means penetrating geographies south of Maine.

AHS recently ventured into the Massachusetts market, and within the next year plans to further expand its recently acquired shipping company and retail pharmacies. Satisfied with the company’s client-to-customer ratio, Theeman says Affiliated’s other immediate goal is to further develop the business with its existing customer base.

For Theeman, business always returns to the relationships forged with those whom his company services. “Relationships are important to us. As long as relationships are important to the people we do business with, we’ll be successful and we’ll help them be successful, too.”

Russ Lane is a freelance writer based in North Carolina.