2012 north american enterprise imaging informatics growth leadership award

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  • 1. 2011 South African Data Centre Green Excellence Award in Technology Innovation Cybernest 2012 2012 North American Enterprise Imaging Informatics Growth Leadership Award© 2011 Frost & Sullivan 1 “We Accelerate Growth”
  • 2. BEST PRACTICES RESEARCHGrowth Leadership AwardEnterprise Imaging InformaticsNorth America, 2012Frost & Sullivan’s Global Research PlatformFrost & Sullivan is in its 50th year in business with a global research organization of 1,800analysts and consultants who monitor more than 300 industries and 250,000 companies.The company’s research philosophy originates with the CEO’s 360 Degree Perspective™,which serves as the foundation of its TEAM Research™ methodology. This unique approachenables us to determine how best-in-class companies worldwide manage growth,innovation and leadership. Based on the findings of this Best Practices research, Frost &Sullivan is proud to present the 2012 North American Growth Leadership Award inEnterprise Imaging Informatics to McKesson Provider Technologies.Key Industry ChallengesThe North American radiology PACS and RIS markets have reached such high levels ofmarket penetration and maturity, that the historical double-digit revenue growth rateshave given way to a much slower growth pattern. In this context of slow growth, thefinancial stability and operational performance of PACS vendors have moved to theforefront of vendor selection criteria in the mind of customers. In fact, the vendors thathave demonstrated unwavering reliability in their customer support and sustainability intheir business model are being favored by customers in the PACS replacement market.During the last three years, healthcare IT enterprises and CIOs have been widelyabsorbed by the HITECH legislation, dedicating most of their efforts and budgets toevaluating and implementing EMR-related projects in order to best align their enterprisewith the first-stage requirements of Meaningful Use. During this period, much attentionhas been driven away from radiology and imaging informatics purchasing decisions tofocus on more pressing needs. This prioritization scheme is one of the factors that iscontributing to further lengthening PACS replacement cycles. In this low-key environmentfor imaging over the last few years, the only PACS vendors that were able to continuallystrengthen their foothold in the market and tighten their ties with their existing customersare those that were able to deliver effectively on workflow optimization, enterprisecommunication and IT integration solutions.Like their radiology counterparts, cardiology providers are being targeted by severereimbursement pressures particularly for cardiovascular imaging procedures. Similar toradiology, historically sustained procedure volumes growth rates have declined to the low-single-digit range, and have even reversed to negative growth rates for certain modalities.This additional economic strain has made the business case for cardiovascular image andinformation management systems (CIIMS) even more difficult to make for providers.However at the same time, cardiology providers are in dire need for effective solutions© 2011 Frost & Sullivan 1 “We Accelerate Growth”
  • 3. BEST PRACTICES RESEARCHthat ensure best-of-breed functionality for each cardiovascular modality, enableconsolidation of growing amounts of patient data, allows integration of an increasinglycomplex enterprise, and provides thorough reporting on more clinical and businessmetrics. In such challenging market conditions, only select CIIMS vendors have succeededin maintaining their business organization upon a healthy growth path.Impact of Grow th Leadership Aw ard on Key StakeholdersThe Growth Leadership Award is a prestigious recognition of McKesson ProviderTechnologies’ accomplishments in the medical imaging informatics industry. An unbiased,third-party recognition can provide a profound impact in enhancing the brand value andaccelerating McKesson Provider Technologies’ growth. As captured in Chart 1 below, byresearching, ranking, and recognizing those who deliver excellence and best practices intheir respective endeavors, Frost & Sullivan hopes to inspire, influence, and impact threespecific constituencies: • Investors Investors and shareholders always welcome unbiased and impartial third-party recognition. Similarly, prospective investors and shareholders are drawn to companies with a well-established reputation for excellence. Unbiased validation is the best and most credible way to showcase an organization worthy of investment. • Customers Third-party industry recognition has been proven to be the most effective way to assure customers that they are partnering with an organization that is leading in its field. • Employees This Award represents the creativity and dedication of McKesson Provider Technologies’ executive team and employees. Such public recognition can boost morale and inspire your team to continue its best-in-class pursuit of a strong competitive position for McKesson Provider Technologies.© 2011 Frost & Sullivan 2 “We Accelerate Growth”
  • 4. BEST PRACTICES RESEARCH C ha r t 1 : B es t P ra c t i c es L ev e ra g e f o r Gr ow t h Ac c e l era t i onBest Practice Award Analysis for McKesson Provider TechnologiesThe Frost & Sullivan Award for Growth Leadership is presented to the company that hasdemonstrated excellence in capturing the highest annual compound growth rate for thelast 3 years.McKesson Provider Technologies’ Performance in Medical Imaging InformaticsBased on the independent research findings from two recent Frost & Sullivan studies ofthe North American radiology and cardiology informatics markets, McKesson ProviderTechnologies is the vendor that has achieved the highest market share gains in themedical imaging informatics market during the last three years.Frost & Sullivan’s competitive benchmarking shows that in radiology informatics,McKesson has continued to consolidate its position in the North American market,narrowing down the gap with its only larger competitor and gaining more market sharepoints than any other vendor. McKesson captured 17.9 percent of total market revenuesincluding service in 2011, the second highest share in the North American market. In thishighly competitive space, this share represents a significant gain over the company’sestimated share of 15.6 percent back in 2008, while the trend forward is also on theincrease. McKesson continues to succeed in the replacement market by winning new largecustomers and thereby moving up-market. At the same time, McKesson is alsoexperiencing success in the mid- and the small-scale market, currently two very dynamiccustomer segments.© 2011 Frost & Sullivan 3 “We Accelerate Growth”
  • 5. BEST PRACTICES RESEARCHIn cardiology informatics, McKesson has witnessed an unprecedented success story overthe last few years. The company has grown its share of the North American market rapidlyand constantly since its acquisition of Medcon Inc. in 2005. McKesson captured 14.1percent of market revenues in 2011, making it the third largest vendor in the NorthAmerican market. In effect, McKesson has evolved from a minor market presence only afew years ago, to become a top-three contender in the cardiovascular image andinformation management systems (CIIMS) arena in the span of six years, surpassing inthe process many long-standing competitors in the field.Key Performance Drivers for McKesson Provider TechnologiesFactor 1: Maximizing Medical Imaging Customer ValueThe growing number of facilities utilizing its radiology and cardiology informatics productsand services has validated an extremely robust value proposition for McKesson in theNorth American imaging informatics marketplace. The brand name has becomesynonymous with industry-leading reliability and performance of vendor service andtechnology. McKesson’s flexibility and commitment as a true partner to its customersallow it to meet varying customer needs by leveraging leading-edge technology from itsown portfolio as well as from its industry partners’. Its track record demonstrates thatMcKesson’s foremost goal is to provide best-of-breed solutions that optimize workflowproductivity and generate immediate as well as long-term operational efficiencies atcustomer facilities.Frost & Sullivan’s competitive benchmarking shows that the company’s outstandingoperational performance makes it easier for McKesson than for many other PACS vendorsto deploy and support its IT solutions over the long-term. In addition, while many othervendors had to constrain their research and development budgets during the phase ofmarket slowdown between 2008 and 2010, McKesson was able to pursue its continualproduct development tracks during these challenging years. The recently launched PACS-independent Enterprise Image Repository exemplifies McKesson’s alignment with theneeds of the marketplace. The company’s high financial stability also allow it to maintainthe highest degrees of price performance and customer service excellence, which explainsthe fact that McKesson is the most often considered vendor in radiology and cardiologyimaging IT replacements.Factor 2: Demonstrating Leadership in Enterprise IntegrationPerhaps the most impactful success factor in McKesson’s imaging informaticsimplementations is the tighter enterprise integration these deployments yield withincustomer organizations. McKesson has demonstrated leadership in the delivery ofproducts and services that enhance communication between the various stakeholdersscattered across the medical imaging and healthcare enterprise. The vendor’s proactive© 2011 Frost & Sullivan 4 “We Accelerate Growth”
  • 6. BEST PRACTICES RESEARCHinvolvement with its customer organizations manifestly leads to increased adoption of itsimaging informatics solutions by the physician referral base, as well as by enterprisestakeholders acting in various IT, clinical and business roles.The recent acquisition of PeerVue in February 2012 is a good illustration of McKesson’scommitment to enterprise value generation within customer sites. According to Frost &Sullivan’s research, this strategic acquisition provides McKesson a leading edge in clinicalworkflow and emergency department communication around imaging. Indeed, the solutionhas a proven track record of optimizing the use of diagnostic imaging in the emergencydepartment by improving workflow efficiency, communication, quality of care and patientsafety.Factor 3: Aligning with the Future of Enterprise Imaging InformaticsA few years ago, McKesson started to build on a business strategy that consists ofpromoting the adoption of add-on solutions and services by clinical and IT departmentswithin its large customer base, in a way that would increase key performance indicatorssuch as customer penetration, customer retention and customer satisfaction rates. Indoing so, McKesson has aligned its business operations well with the trends affectingimaging providers’ technology adoption and financing models. This strategy has started topay-off for the company in the last two years, as McKesson is now driving more significantrecurring revenue streams from its customer base while securing long-term customerretention and achieving industry-leading customer satisfaction rates.In Frost & Sullivan’s opinion, with its recent successes in cardiology informaticscomplementing its exemplary performance in radiology informatics, McKesson is ideallypositioned today to deliver effectively on the promise of integrated, enterprisewideimaging informatics solutions. McKesson’s deep entrenchment in the North Americanhealthcare IT arena further strengthens the company’s ability to partner with customerson comprehensive IT solutions, and to assist them proactively in their meaningful usestrategies within and around the medical imaging specialty.ConclusionMcKesson has been highly successful during the last five years in achieving multi-facetedand sustainable growth in all of the saturated radiology informatics market, the complexcardiology informatics market and the fragmented enterprise imaging market. Thisachievement further demarcates McKesson from the competition and consolidates itsposition within the top-tier enterprise imaging informatics vendor group. Frost & Sullivan’sanalysis for the Enterprise Imaging Informatics Market clearly shows that McKesson is areliable PACS vendor whose solution enhances productivity and enterprise integration.Based on these market share advances and the success factors underlying this growth,McKesson is the well-deserving recipient of the 2012 North American Growth Leadershipaward in Enterprise Imaging Informatics.© 2011 Frost & Sullivan 5 “We Accelerate Growth”
  • 7. BEST PRACTICES RESEARCHThe CEO 360 Degree Perspective T M - Visionary Platform for GrowthStrategiesThe CEO 360 Degree Perspective™ model provides a clear illustration of the complexbusiness universe in which CEOs and their management teams live today. It representsthe foundation of Frost & Sullivans global research organization and provides the basis onwhich companies can gain a visionary and strategic understanding of the market. The CEO360 Degree Perspective™ is also a “must-have” requirement for the identification andanalysis of best-practice performance by industry leaders.The CEO 360 Degree Perspective™ model enables our clients to gain a comprehensive,action-oriented understanding of market evolution and its implications for their companies’growth strategies. As illustrated in Chart 5 below, the following six-step process outlineshow our researchers and consultants embed the CEO 360 Degree Perspective™ into theiranalyses and recommendations. Chart 2: The CEOs 360 Degree Perspective™ Model© 2011 Frost & Sullivan 6 “We Accelerate Growth”
  • 8. BEST PRACTICES RESEARCHCritical Importance of TEAM ResearchFrost & Sullivan’s TEAM Research methodology represents the analytical rigor of ourresearch process. It offers a 360 degree view of industry challenges, trends, and issues byintegrating all seven of Frost & Sullivans research methodologies. Our experience hasshown over the years that companies too often make important growth decisions based ona narrow understanding of their environment, leading to errors of both omission andcommission. Frost & Sullivan contends that successful growth strategies are founded on athorough understanding of market, technical, economic, financial, customer, bestpractices, and demographic analyses. In that vein, the letters T, E, A and M reflect ourcore technical, economic, applied (financial and best practices) and market analyses. Theintegration of these research disciplines into the TEAM Research methodology provides anevaluation platform for benchmarking industry players and for creating high-potentialgrowth strategies for our clients. C ha r t 3 : B e nc h ma r ki ng P e rf or ma nc e w i t h TE A M R es ea rc hAbout Frost & SullivanFrost & Sullivan, the Growth Partnership Company, enables clients to accelerate growthand achieve best-in-class positions in growth, innovation and leadership. The companysGrowth Partnership Service provides the CEO and the CEOs Growth Team with disciplinedresearch and best-practice models to drive the generation, evaluation and implementationof powerful growth strategies. Frost & Sullivan leverages 50 years of experience inpartnering with Global 1000 companies, emerging businesses and the investmentcommunity from more than 40 offices on six continents. To join our Growth Partnership,please visit http://www.frost.com.© 2011 Frost & Sullivan 7 “We Accelerate Growth”