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         Clinical intelligence for supply chain leadership

INSIDE THE CURRENT ISSUE

June 2007

Up Close
Why closing GPO career to move boxes
was worth the wait

New Suture Express CEO Ed Kuklenski strives to ‘defeat an army of thousands with a handful of zealots’

by Rick Dana Barlow

For Ed Kuklenski, it simply was time. After a 17-year career in group purchasing it was time to do something else.

So he ended his run last year as senior vice president of shareholder services at Shawnee Mission, KS-based Child Health Corporation of America, a long-time Premier Inc. shareholder organization, with virtually nothing professional or work-related to fill his time, save for figuring out what to do next.

Kuklenski didn’t have to wait long. Last fall he was contacted by a well-known recruiter. By November, he was installed as the new president and CEO of Suture Express, the Lenexa, KS-based specialty distributor of suture and wound closure products.

In addition to his nearly two decades of experience in healthcare group purchasing, Kuklenski co-founded FoodBuy, a national group-buying company focused on the food service industry, where he serves on the board of directors. His background also includes various sales, marketing and general management positions at Baxter International Inc. and American Hospital Supply Corp. (now part of Cardinal Health Inc.)

Kuklenski recently took time out of his busy schedule to field a number of questions from Healthcare Purchasing News Senior Editor Rick Dana Barlow about his plans for Suture Express, how he fits into the company’s future and what his group purchasing expertise contributes to the process.

HPN: You’re a long-time group purchasing guy with about two decades of experience behind you, as well as nearly a decade in sales. What attracted you about running a distributor – and one with such a specialized product line?

KUKLENSKI: I know this will sound cliché but it was the people and the opportunity to lead an organization that is truly making a difference. When I first walked into Suture Express’ offices I was impressed by the enthusiasm everyone had for the company, their customers and what they were doing. It struck me that the employees at Suture Express didn’t view the company as a distributor but rather a problem solver. They shared with me numerous stories about customers calling Suture Express thanking them for relieving their pain dealing with backorders, pricing discrepancies, delivery issues, etc. It was apparent these folks had a passion for what they were doing and loved the company.

Initially, I didn’t have an appreciation for just how broken the supply chain is for wound closure – suture and endo – products and how well positioned Suture Express is to capitalize on the opportunity. I’ve learned that focusing on a specialized product line is what differentiates Suture Express from all of the other players. Our mantra is, ‘Complete Orders Tomorrow!’

When you joined Suture Express last fall you said you received a call about the position, intimating you didn’t actively pursue it. Why do you think they called you?

That is correct. When I received the call from the recruiter at Heidrick & Struggles regarding the CEO position at Suture Express I wasn’t actively pursuing job opportunities. I had recently concluded a seventeen year career with Child Health Corporation of America (CHCA). My plans were to take a year or so off to determine what I wanted to do with the second half of my life.

Dennis Jordan, one of the founders of Suture Express, contacted me and indicated that an equity acquisition group was taking a majority interest in the company. He informed me that two of the founding partners, Joe Robinson and Hank Miller, were retiring and asked if he could submit my name as a potential candidate for the position. Based on my background and industry experience the team at Suture Express expressed their support for me to be the CEO. The opportunity to join something as special and unique as Suture Express was just too tempting to remain on the sidelines.

You work with guys like Jim Vaughn [vice president of sales] and Dennis Jordan [vice president of operations], former hospital materials management directors, both of whom you characterize as helped to revolutionize healthcare distribution. How did they do that? And what do you expect to contribute to that?

I believe Jim Vaughn and Dennis Jordan have revolutionized healthcare distribution in a similar fashion to how Herb Kelleher, founder, Southwest Airlines, revolutionized the airline industry. Herb saw an industry that charged irrational prices, provided poor service, had lost touch with the customer, overcomplicated simple functions, underutilized its resources and was controlled by a handful of big players. In a nutshell, no pun intended, he saw an industry that was broken and was determined to fix it.

As hospital-based supply chain mangers, Jim and Dennis saw the same issues with the distribution of wound closure products. They experienced first-hand the frustration and pain associated with chasing down backorders, carrying costly inventory, reconciling price discrepancies, identifying product codes, dealing with returns and trying to understand all of the different distributor markups/fees/delivery charges, etc. They also saw a system that was broken and were equally determined to fix it.

Against high odds for success, Herb launched Southwest Airlines with a few simple goals: Be the ‘Fun Airline’ and deliver the highest On Time Arrivals at the lowest possible airfares. He had a passion for simplifying, standardizing and automating every aspect of the operation. Herb was relentless about eliminating or reducing unnecessary costs and providing a fun work environment and passenger experience. All of this was done while instilling a very human and personal approach to an industry that had lost touch with its customers.

Jim and Dennis, along with Joe Robinson and Hank Miller, also launched Suture Express against high odds and with a simple mission: Eliminate all of the hassles and be ‘Complete, Fast and Cheap.’ This meant a complete order delivered tomorrow morning at the lowest prices in the industry, period! As Jim likes to say, ‘What don’t you understand about what we do?’ Like Herb, they were relentless about challenging the status quo, eliminating costs and simplifying processes. Their commitment to excellence, attention to detail and focus on wound closure products are the key to our success. It doesn’t hurt that they exude enthusiasm and passion for our mission which is contagious.

As you can see, I’ve been dealt a great hand. Dennis, Jim, Hank, Joe and the rest of the team at Suture Express have done the heavy lifting and built a tremendous company. The core is solid and positioned for growth. I expect to prod and poke around the edges to continue to move the needle regarding quality improvement and new business opportunities. I’m also focused on institutionalizing the founder’s knowledge throughout the organization so that we will continue to operate in a manner consistent with the high standards they set.

You’ve been in place for six months now. Has it been all you expected? What did you expect to find when you started and how has that changed now that the honeymoon period is over?

It’s been everything I expected, plus some. I knew I was joining a great team with a proven game plan but I didn’t know I was going to the Super Bowl. These guys play for keeps and are always raising the bar. This company is like the ‘Little Engine that Could,’ which may sound corny but is true. Everyone at Suture Express believes we should have all of the suture and endo product distribution business, and Suture Express won’t slow down until we do.

I’m not sure there was a honeymoon period. The presses didn’t stop or slow down when I arrived. We have to perform at an exceptionally high level everyday if we’re to stay in business. There is really nothing fancy about what we do. We put stuff in a box and deliver it tomorrow. From day one it has been about execution and attention to detail. The key is to keep it simple and stay focused on eliminating the hassles. Service, service and more service!

What are some of your first-year goals and how are you progressing to accomplish them?

As the recruiter said, ‘Ed, your first goal is to not screw this up.’ Since there wasn’t anything broken at Suture Express I’m trying hard to stay out of the way of the folks who really know what they’re doing. I’ve been focused on ensuring that they have the tools and resources they need to support our growth. My first year goals center on learning as much as possible about the nuances of this business and continuing to recruit high quality players to the team.

How did your experience in group purchasing prepare you to run Suture Express?

During my career with CHCA, I was responsible for a number of different activities, including: Accountability for the ‘P&L’ of CHCA’s GPO business unit, recruiting new members, co-managing an investment portfolio, negotiating purchasing agreements, managing CHCA’s insurance company, recruiting/hiring/training staff, developing new business opportunities and representing CHCA on various industry boards. All of these activities have prepared me to lead Suture Express.

What did you bring to Suture Express from the group purchasing business?

I brought a very good understanding of how GPOs operate and access to a number of contacts within the GPO industry. Suture Express currently has three national GPO contracts and will entertain additional contracts as opportunities arise. We recognize the important role that GPOs play in the industry. We’re proud that the largest IDN members of all of the major GPOs in the country are current customers, including: Ascension Healthcare, Providence Healthcare, Peace Health, St. Joseph’s – Orange, Banner Health, Yankee Alliance and HealthSouth. These existing customers are a real testament to our value proposition.

What are some of the key goals you’d like to achieve at Suture Express within the next three years and why?

I want Suture Express to be the most admired company in the industry. I want to further distance Suture Express from our competition by incrementally improving on our 100 percent customer satisfaction guarantee. I also want to ensure that our employees continue to grow and assume additional responsibilities as opportunities present themselves.

Suture Express portrays itself as a down-to-earth, simple, no-frills, customer-centric specialty distributor of a select group of wound closure products. How does a company like Suture Express succeed in a distribution world dominated by the glitz and sizzle of the big box corporations with the flashy Web sites and phalanx of sales and marketing experts?

Suture Express is everything you just described with one exception; we don’t just have a select group of wound closure products but rather the largest assortment and variety of suture, endo, mesh, drains, bone wax and surgical adhesives in the country. If it’s a wound closure product and a customer needs it, we’ve got it and can deliver it tomorrow at the lowest prices in the industry.

We feel very fortunate to have grown as much as we have over the past eight years. I believe this growth validates the need for a distributor focused on wound closure products. For us, it’s all about focus. We believe a handful of zealots can defeat an army of thousands. Don’t get me wrong, I think the big box movers serve a vital role in the supply chain but we are the best option for the wound closure market segment. Let me ask your readers a question. Where do you rent your videos? Your grocery store – Safeway, Kroger, Albertson’s – or Blockbuster? Most folks would say Blockbuster based on selection, convenience and price. My point is we are Blockbuster and our competition is the grocery store. Both serve a need.

Where does Suture Express go from here, in terms of expanding service options, product diversity, etc.?

Suture Express will remain focused on being the best at servicing the wound closure product market. In order to deliver on our promise of ‘Complete, Fast and Cheap,’ we have been selective in our product offering and manufacturers. Currently, Ethicon, Ethicon Endo-surgery and U.S. Surgical represent the majority of the products we sell. They are outstanding business partners and work closely with us to identify and implement solutions for improving the supply chain. Based on requests from our customers we are currently reviewing several other national brand manufacturers with complementary products to add to our offering.

Until recently, we have been primarily focused on the acute care hospital and surgery center market. We plan to aggressively pursue the alternate site market in the coming months and will be launching a new e-commerce site to assist in this effort. We have also positioned Suture Express as a re-distributor to the smaller regional and local medical products dealers.

What’s the biggest challenge you’re facing in your new role and how are you dealing with it?

The biggest challenge is the temptation to jump right in and change something before I fully understand the landscape or consequences. Like every successful organization, Suture Express has a ‘special chemistry’ and ‘magic’ that can easily be lost if I lose sight of how we got here. I need to be respectful of what has enabled Suture Express to be so successful while being mindful of the need to do some things differently to remain the best. A good analogy would be Tiger Woods recognizing that he needed to revamp his golf swing even though he was the No. 1-ranked player in the world. I also need to challenge the team and myself to ask what it will take to be the leader tomorrow. It’s easy to become complacent when you have grown as quickly and as much as Suture Express in such a short period of time.

As someone who spent a large part of his career in healthcare group purchasing, what will you miss the most and the least about group purchasing?

I miss the people the most. I developed a number of friendships at CHCA and throughout the GPO industry. I have found it difficult to stay in touch as often as I would like due to the focus on Suture Express. Some of my friends and colleagues won’t even talk to me now that I’m a vendor – just kidding.

I don’t miss the ongoing dialogue regarding the value of GPOs or the countless meetings focused on justifying the business practices of GPOs. In many ways it is time for all of us to move on to more productive activities. I’m thankful for where I am.