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HIT Leader 3.0 Cornerstone: Setting Vision and Strategy in

Dynamic Times

Russ Branzell, CHCIO, FCHIME CEO/President

We’ve come a long way!

What’s Important to the C-Suite?

American College of Healthcare Executives

Top Issues Confronting Hospitals: 2013

Issue 2013 2012 2011

Financial challenges 2.4 2.5 2.5

Patient safety and quality2 4.9 4.4 4.6

Healthcare reform implementation1 4.3 4.7 4.7

Governmental mandates 4.9 5.0 4.6

Care for the uninsured 5.6 5.6 5.2

Patient satisfaction 5.9 5.6 5.6

Physician-hospital relations 6.0 5.8 5.3

Technology 7.9 7.6 7.2

Population Health Mgt 7.6 7.9

Personnel shortages 8.0 8.0 7.4

Creating ACO 8.6 8.6 8.4

How to Be a CEO for the Information Age Michael Earl and David Feeny

Sloan Management Review, Winter 2000, Volume 41 Number 2

“The implications for existing and aspiring CEOs are equally clear.

Information technology is now a survival issue…more and more frequently IT issues are now wrapped inside wider

questions of business strategy.”

The Black Hole of IT Value

“While [the system] has helped [us] boost patient safety and medication administration processes, [we have] put quality of care and improving safety ahead of ROI and time savings.”

- VP of Quality and Care Management

“I estimate that about half of our IT investment generates value . . . I just can’t figure out which half.”

- Healthcare CEO

“Some healthcare CEOs refer to IT as that black hole you pour money into… never seeing results.”

- Healthcare CEO

The Healthcare CIO: From Crawling to Walking Upright, to Carrying the Organization

Knowledge

Purveyor

Technology

Interpreter

Process Visionary

Process

Consultant

Financial Analyst

Change Agent

Educator

Lobbyist

Service Broker

Project Advisor

Venture Capitalist

Customer Service

Innovator

Economist

Risk Manager

Political

Visionary

Application

Purveyor

Vendor Manager

Project Manager

Asset Manager

Problem Manager

Skill Manager

Process Navigator

An Advisor role

A Driver role

Tech Manager

A Supportive role

CIO 1.0 CIO 2.0 CIO 1.5

An Enabler role

IT Operations

+ +

Building Blocks of HIT 2.0

• Healthcare Information Exchange

• Certified Electronic Health Record

• Patient Portals

• Data Warehouse

• Business Intelligence

• Complete Data Integration

• Data Analytics

• World-class IT Team

• Unified Communications

• ACO System

• Population Health System

• Document Management

Business Value in Healthcare

Healthcare Value ˭ Dollars

Spent

Patient Outcomes &

Revenue Enhancement

Adapted from Value Measurement for Healthcare, Harvard Business School Executive Education

˭ IT/Informatics

Value

Future IT Trends • Security

• Cloud

• Telemedicine

• Predictive Modeling

• Patient Empowerment

• Big Data

• Consumerism

• Consolidation

• mHealth

• BYOD/T

versus

Evolution: gradual development of

something, especially

from a single to a more

complex form.

Revolution: fundamental change

in a way of thinking

about or visualizing

something.

EVOLUTION REVOLUTION vs

.

Care Improvement Process

Status Quo – Fee for Service

Wellness Care

Quality Care

Managed Care

Value Care

1) Integration

2) Value (Cost & Quality)

3) Transparency

U.S. Healthcare - Three Process Trends

“The job of the leader isn’t

just to make decisions, it’s

to make sense.”

The Big MOO, The Group of 33, Edited by Seth Godin. Quote by John Seely Brown

Before Vision and Strategy …

Values

Vision

Mission

Strategy

What we are talking about

• Values: the identity of the organization

• Mission: the reason for being

• Vision: a mental picture of what you want to accomplish or achieve.

• Strategy: how to get there

How do they work together? Values Mission Vision Strategy

• Determines distinctiveness

• Prescribes participation

• Expresses essentials • Affects action • Inspires investment • Leverages leadership • Supplies success

• Dictates direction • Formulates function • Focuses future • Directs decisions • Causes congruence • Enhances

effectiveness • Ensures endurance • Facilitates feedback

• Endows energy • Creates cause • Fosters failure

(positive) • Legitimizes

leadership • Sustains structure • Commands

commitment

• Accomplishes mission and vision

• Improves insight • Maximizes

momentum • Retains resources • Accentuates

achievements

Adapted from “Advanced Strategic Planning” by Malphurs

Determines Mission and Vision

“ The people in the high-

performance IT organization

don’t feel different from other

corporate citizens…They

operate according to the same

corporate values as everyone

else and are measured by the

same tough performance

standards.”

“Getting IT Right” by Charlie S. Feld and Donna B. Stoddard

Harvard Business Review, February 2004

Strategy Example

“Making IT work demands the same things that other parts of the business

do - inspired leadership, superb execution, motivated people, and the thoughtful attention and high

expectations of senior management.”

“Getting IT Right” by Charlie S. Feld and Donna B. Stoddard Harvard Business Review, February 2004

Be a Strategic IT Leader • Understand the business

• Build bridges with clinicians

• Anchor your thinking in process improvement and measurement

• Use simple and straight forward communication

• Establish trust by achieving results

• Look for direction and new approaches

• Contribute ideas and options

Engage Your Senior Team

• Explain and educate on the value of IT; encourage CEO’s visible commitment

• Build relationships with key IT vendors and suppliers

• Partner with the CMO, CMIO and CNO to build a strong clinical informatics function

• Work with the CFO to build effective financial processes and systems

Create a Framework for Strategic Alignment

• Establish an IT executive strategic planning group (IT governance)

• Guide the executive team to set priorities, standards and guidelines

• Contribute to decision-making methods and criteria

• Include regulatory, security and infrastructure requirements

Approaches to Strategy

Strategy creation follows a three-stage process:

1. Analyze the context in which you're operating

2. Identify strategic options

3. Evaluate and select the best options

Approaches to Strategy Stage 1: Analyze Your Context and Environment

• Analyze Your Organization

– Resources, liabilities, capabilities, strengths, and weaknesses. (SWOT Analysis).

– Core Competencies. Unique strengths--differentiators—gaps

• Analyze Your Environment

– Opportunities you should pursue?

– Future scenarios that are likely in healthcare

– How will these impact the work that you do?

• Analyze Your Customers and Stakeholders

• Analyze Your Competitors

Approaches to Strategy Stage 2: Identify Strategic Options

• To create a clear advantage and meet your objectives.

1. Brainstorm Options

2. Examine Opportunities and Threats

3. Solve Problems and Fill Gaps

Approaches to Strategy Stage 3: Evaluate and Select Strategic

Options

• Evaluate each option in the light of the contextual factors you identified in Stage 1. What do these tell you about each option?

• Techniques like Risk Analysis and Impact Analysis to spot the possible positive and negative consequences of each option.

• Financial techniques like Cost-Benefit Analysis, Break-Even Analysis, use of Net Present Values (NPVs) and Internal Rates of Return (IRRs), and Decision Trees are helpful.

• Grid Analysis is particularly helpful for bringing together financial and non-financial decision criteria

Develop the IT Strategic Plan • Start with executive sponsorship

• Match technology options to your organization’s strategies, initiatives and timelines

• Identify key initiatives and due dates

• Develop the high level financial requirements – capital and operating

• Include strategic commitment for infrastructure and life cycle investments

• Include staffing requirements

Cultivate Sponsorship

• Seed formal Executive Sponsor for all IT enabled strategies

• Use IT as an accelerator of strategy

• Build clinician driven structures to design and validate applications and to prioritize demand for optimization and continuous enhancement of systems

Create a Multi-Year Roadmap

• Identify the key IT initiatives

• Identify project schedules and duration

• Include interdependencies

• Use as a basis for developing the business case and Total Cost of Ownership models for projects

The Big Shift in IT Leadership Strategy -- 7 Action Steps for CIOs

• Architect the digital blueprint

• Become an information steward

• Get the basics right

• Eliminate cyber threats

• Collaborate around the clock

• Strengthen relationships across the C-suite

• Look above the operational parapet Linda Ban, "Moving from the Back Office to the Front Lines"

34

Leadership

35

Practical

Aligned

Aligned Top Five or So

• Thoroughly Understand System Plan

• Determine Enterprise Architecture Requirements

• Build IT Plan to Enable System Plan Success

• Ensure Direct Correlations Between Plans

• External Reviews with Partners & Advisors

• Bounce Concepts & Plan with Steering Cmte

Radical?

Strategic Advantage Comes via Differentiated Capabilities, not Position

If we don’t develop differentiated capabilities, the competition will eventually catch up and pass us

Start Finish Position

Capability

2 mile / hr.

8 mile / hr.

Differentiated Capability

18 mile / hr.

Radical • Initiate New Business

• New Executive Orientation

• Embed in Governance and PMO Processes

• Engage Rank and File

• Allow Margin for Innovation

• Review & Adjust Quarterly

• Plans Should Reflect Simplicity and Beauty

• Signatures

• Execution > Pontification

Care Improvement Process

Status Quo – Fee for Service

Wellness Care

Quality Care

Managed Care

Value Care

1. Don’t accept the status quo

2. Semper Gumby: “Always Flexible”

3. Plagiarism is skill, not a crime

4. Don’t evolve, REVOLVE!!!!

5. Make somebody mad today!!!!

Rules of the Revolutionary CIO

Thank you!