A Roadmap To Welcoming Health Care Innovation

Health care systems are being flooded with a slew of digital innovations, both internally and externally sourced. The promise of remote sensors, machine learning, artificial intelligence, and personal health records, together with investment from the National Institutes of Health and private investors, has resulted in a tsunami of interest in these solutions. Yet, health care systems across the country are struggling with their approach to innovation, which has resulted in a tremendous proliferation of pilot studies but little adoption of solutions at scale. The mismatch between the promise of the technology and current organizational strategy requires further examination. 

Why Is This So Hard? 
The first challenge is that executing on innovation that impacts value (cost and quality) requires both technology and business model transformation. While we have had significant focus on the technology aspects of the digital revolution, the business model transformation aspect has received much less attention. Business transformation requires significant investment of time by senior leadership, resources, the development of new business models, and the retirement of legacy business models. Most organizations will not undertake this level of investment in a novel concept without significant justification. 

Another dilemma stems in part from leadership’s inability to evaluate novel technologies and pilot studies appropriately from an investment perspective. Rather than being seen as a point solution, digital innovations should be viewed as a starting point for investment in novel business processes, novel business designs, and potentially, novel organizational structures. Senior leadership, which must assess whether the digital innovation has reached a level of maturation appropriate to this level of investment, is often the bottleneck in these decision-making processes. Leaders at lower levels of decision making are often not empowered to make decisions regarding business transformation, and few health systems have an alternative “strategic” decision-making pathway that includes alternative perspectives, leaders, and metrics. 

Leaders of organizations are rewarded for predictable performance, achieving revenue targets with little room for deviation. Innovation inherently involves uncertainty: time frames slip, enrollment lags projections, and unanticipated conflicts arise with other aspects of the organization. Given the clear prioritization of predictable performance, innovation stands in conflict with organizational objectives unless expectations are adjusted to balance predictable performance with a more strategic innovation agenda. 

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